Petrofac says demand still strong as net profit jumps

By Hsu Chuang Khoo

LONDON (Reuters) - Long-term demand at Petrofac remains "very strong", with full-year financial results seen at the top end of market expectations, the oil and gas services firm announced on Wednesday.

Petrofac (PFC.L) earlier reported better-than-expected net profit for the first half to end-June that jumped 57 percent to $121.2 million (65.6 million pounds) from a year ago, helped by strong demand at its main engineering and construction unit.

Petrofac, whose shares have gained 43 percent in 12 months, is expected to make a net profit of between $228 million and $262 million in its full year, according to a range of forecasts by 13 analysts given by the company.

On Wednesday, its shares rose 1.5 percent to 602 pence following the results announcement, to value the entire firm at about 2.08 billion pounds.

Analysts say Petrofac is more susceptible than its peers to weak oil price sentiment given its direct industry exposure, but stands to benefit on any turn in that sentiment as its projects begin delivering cashflow.

"Notwithstanding recent reductions in forecast short-term global economic growth prospects, the broad environment in which the group operates remains underpinned by long-term factors and demand for our services continues to be very strong," Petrofac Chief Executive Ayman Asfari said in a statement.

"We expect to see significant investment in new and replacement production capacity by our customers, particularly in our core markets."

Petrofac added that order intake in the period to June was $1.7 billion, and it had an order backlog of $4.8 billion. Additionally, it is currently bidding for projects valued at over $10 billion.