Medserv returns to the black
Medserv plc published its interim results for the six months ending June 30 following a board meeting held on Monday. The key highlights are• turnover amounts to €5.9 million (June 07: €1.2 million);• EBITDA climbs to €0.9 million; and• pre-tax profit...
Medserv plc published its interim results for the six months ending June 30 following a board meeting held on Monday.
The key highlights are
• turnover amounts to €5.9 million (June 07: €1.2 million);
• EBITDA climbs to €0.9 million; and
• pre-tax profit of €0.68 million.
Medserv's turnover during the first half of this year amounted to €5.9 million, substantially higher than the revenue generated in the first six months of 2007. The directors explained that this surge in turnover results from the commencement of the long-awaited activity in the Mediterranean region. Last year Medserv had reported that the delays in the commencement of oil and exploration activities offshore Libya resulted from the shortage of available exploration rigs as well as a scarcity of steel and other equipment. During the first half of the year the Medserv Group, through its Malta base, provided services to operators in Egypt, Tunisia and Congo apart from the traditional source of business in Libya. The strong increase in revenue from the Malta base is partly attributable to the new business generated in Egypt and Tunisia. The segmental results reveal that the Misurata base, in which Medserv holds a 60 per cent shareholding, accounted for 23 per cent of total group revenue in the first half of the year with the balance generated from the base located in the Malta Freeport. At the Misurata base four major oil companies are being serviced. It was also revealed that apart from warehousing and storage services, mud tanks were installed while bulk plants are being constructed and scheduled for completion at the end of September 2008.
The gross profit climbed to €1.8 million during the period under review, up from only €0.2 million in the first half of 2007, leading to an improved gross profit margin of 30.4 per cent (June 2007: 20.1 per cent). In the first six months of 2006, Medserv had generated a gross profit of €1.1 million with a margin of 33.9 per cent. Administrative and distribution expenses increased by 44 per cent to €1.05 million, resulting in an operating profit of €0.75 million.
The charge for depreciation during the first half of the year amounted to €177,429. Medserv generated total earnings before interest, tax, depreciation and amortisation of €0.9 million with an EBITDA margin of 15.7 per cent. In the first half of 2007 Medserv had generated a loss but in 2006, EBITDA had amounted to €0.66 million with a margin of 19.8 per cent.
After accounting for net interest expenses of €0.07 million, the Medserv Group's pre-tax profit during the first half of 2008 amounted to €0.68 million compared to a loss of €0.53 million in the comparative period last year. Medserv's income statement was also positively impacted by deferred tax income of €0.2 million and after deducting the profit attributable to minority interests (representing the 40 per cent shareholding in Misurata), Medserv generated a profit of €0.78 million during the six months to June.
The 2008 interim results are encouraging following the very disappointing performance in 2007, and vindicate the directors' claims that the slowdown in 2007 did not represent "lost business" but "delayed business". These financial statements also highlight the wise decision taken to replicate the company's services in Libya through the base in Misurata and the directors reported that a further 30,000 square metres of land has been rented for a 30-year period to cater for the envisaged and continuing growth in business. The business pipeline is also strong with works currently being undertaken to a rig from its Malta base while two other rigs are expected to be serviced before starting drilling operations offshore Libya next year.
The key highlights are
• turnover amounts to €5.9 million (June 07: €1.2 million);
• EBITDA climbs to €0.9 million; and
• pre-tax profit of €0.68 million.
Medserv's turnover during the first half of this year amounted to €5.9 million, substantially higher than the revenue generated in the first six months of 2007. The directors explained that this surge in turnover results from the commencement of the long-awaited activity in the Mediterranean region. Last year Medserv had reported that the delays in the commencement of oil and exploration activities offshore Libya resulted from the shortage of available exploration rigs as well as a scarcity of steel and other equipment. During the first half of the year the Medserv Group, through its Malta base, provided services to operators in Egypt, Tunisia and Congo apart from the traditional source of business in Libya. The strong increase in revenue from the Malta base is partly attributable to the new business generated in Egypt and Tunisia. The segmental results reveal that the Misurata base, in which Medserv holds a 60 per cent shareholding, accounted for 23 per cent of total group revenue in the first half of the year with the balance generated from the base located in the Malta Freeport. At the Misurata base four major oil companies are being serviced. It was also revealed that apart from warehousing and storage services, mud tanks were installed while bulk plants are being constructed and scheduled for completion at the end of September 2008.
The gross profit climbed to €1.8 million during the period under review, up from only €0.2 million in the first half of 2007, leading to an improved gross profit margin of 30.4 per cent (June 2007: 20.1 per cent). In the first six months of 2006, Medserv had generated a gross profit of €1.1 million with a margin of 33.9 per cent. Administrative and distribution expenses increased by 44 per cent to €1.05 million, resulting in an operating profit of €0.75 million.
The charge for depreciation during the first half of the year amounted to €177,429. Medserv generated total earnings before interest, tax, depreciation and amortisation of €0.9 million with an EBITDA margin of 15.7 per cent. In the first half of 2007 Medserv had generated a loss but in 2006, EBITDA had amounted to €0.66 million with a margin of 19.8 per cent.
After accounting for net interest expenses of €0.07 million, the Medserv Group's pre-tax profit during the first half of 2008 amounted to €0.68 million compared to a loss of €0.53 million in the comparative period last year. Medserv's income statement was also positively impacted by deferred tax income of €0.2 million and after deducting the profit attributable to minority interests (representing the 40 per cent shareholding in Misurata), Medserv generated a profit of €0.78 million during the six months to June.
The 2008 interim results are encouraging following the very disappointing performance in 2007, and vindicate the directors' claims that the slowdown in 2007 did not represent "lost business" but "delayed business". These financial statements also highlight the wise decision taken to replicate the company's services in Libya through the base in Misurata and the directors reported that a further 30,000 square metres of land has been rented for a 30-year period to cater for the envisaged and continuing growth in business. The business pipeline is also strong with works currently being undertaken to a rig from its Malta base while two other rigs are expected to be serviced before starting drilling operations offshore Libya next year.