November 30, 2017 / 7:46 AM / a year ago

Oil rig builder Lamprell cuts earnings forecast as East Anglia project bites

Nov 30 (Reuters) - Oil rig builder Lamprell Plc said it expected 2017 earnings to be materially below market expectations, hurt by losses stemming from a contract for an East Anglia offshore windfarm project.

The company received a contract in 2016 from ScottishPower Renewables for making parts for the East Anglia One windfarm in the North Sea.

“There were start-up costs and inefficiencies in relation to the project and the learning curve has proven to be steeper than anticipated,” the United Arab Emirates-based company said in a statement.

Lamprell, which said it was working with its client and the supply chain to mitigate the additional costs, expects 2017 revenue to be in line with current guidance.

The company in September lowered its full-year revenue forecast to $370 million to $390 million, citing low levels of walk-in work. It had previously forecast revenue to be in the lower half of a range of $400 million to $500 million.

Like its peers, Lamprell has been cutting costs as oil explorers have slashed spending and cancelled contracts to counter weak oil prices. The company is also expanding into the renewable energy business to bolster its portfolio. (Reporting by Noor Zainab Hussain in Bengaluru; Editing by Saumyadeb Chakrabarty)

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