Msg from CEO form 3/21 earnings report:
Pierre Marie Valentin, Chairman and Chief Executive Officer of the Coflexip Stena Offshore
Group, made the following comments:
``While 1999 was a challenging year, we are proud to have achieved one of the highest levels of
profitability in our industry with net income at 9% of revenues, thanks to the outstanding
performance of our teams throughout the world.
``We believe that we're in the early stages of a rebound. This is seen in the increase in the
worldwide volume of tenders pending for subsea products and services. We estimate that the
volume of tenders to be awarded during the first half of 2000 will be $1.8 billion, more than
double the $800 million awarded in the first half of 1999.
``Moreover, we have begun to rebuild our backlog in the last 2 months with EUR232 million in
new orders that include Tambar from BP AMOCO and Njord from NORSK HYDRO, both in
Norway, and Blake from BRITISH GAS in the UK. In the Gulf of Mexico a new installation
contract for the CSO Apache will include the first reeled installation of steel catenary risers
(RSCR) and pipe in pipe at 1,100 meters depth. Lastly, we will be delivering to PETROBRAS
flexible lines for the first two well heads on the Roncador field, which will establish, when they
are installed by the Sunrise 2000, a new worldwide depth record.
``We continue to hold the view that activity for our segment of the industry may be 10% weaker
in 2000 compared with 1999, and our margins could be affected by underutilization of the fleet
and the Le Trait plant.
``Our challenge is to win new tenders and continue to build-up the order book for execution in
2001 and onwards. We have therefore added more front- end engineering capabilities through
the RJ. Brown acquisition in Houston that will strengthen our Deepwater Field Development
Division in pursing deepwater tenders worldwide. Construction of the CSO Deep Blue and
active marketing of the vessel is well underway and her exceptional features are already
drawing attention from our clients.
``We are thus fully prepared to serve our clients with a renewed technological offer, increased
commercial aggressiveness and financial strength.'
World leader in the subsea oilfield service industry, Coflexip Stena Offshore provides a wide
range of services (project management, engineering design, procurement, subsea pipeline and
umbilical laying, construction and maintenance work) and products (design and manufacture of
flexible pipes, control umbilicals and remotely operated vehicles). |
