Petrofac Sees Modest Free Cash Outflow, Net Debt Drop

June 28, 2022

Credit: Petrofac
Credit: Petrofac

Oilfield services provider Petrofac Ltd said on Tuesday it expects modest free cash outflow during 2022 due to delays in cash collections from clients, although it projects net debt to be reduced in the second half of 2022.

Shares of the company jumped nearly 5% in early trading.

Petrofac also said its net debt had doubled to $345 million, as of June 23, following the payment of a penalty to Britain's Serious Fraud Office (SFO) and slower payments from clients.

The company was fined $104 million last year after pleading guilty to bribes related to contracts in Iraq, Saudi Arabia and the United Arab Emirates between 2011 and 2017. 

In the second half of the year, Petrofac expects revenue for its Asset Solutions unit to be higher, supported by strong order intake in the year to date.

"We have a healthy 18-month Group bidding pipeline and we expect to secure significant new orders in 2023, underpinned by opportunities in the UAE and offshore wind," Chief Executive Officer Sami Iskander said in a statement.

The company, which has drawn a line under the SFO investigations, said its half-year trading was in line with expectations, as an upswing in oil prices raised demand.

(Reuters - Reporting by Amna Karimi in Bengaluru; Editing by Sherry Jacob-Phillips and Uttaresh.V)



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