Aberdeen-based Offshore Hydrocarbon Mapping, which specialises in controlled-source electromagnetic imaging surveys to find oil and gas, has warned investors over its future.
Executive chairman Dave Pratt said yesterday after OHM reported lower revenue and wider losses for the year to August 31 that the board was considering all options to ensure the company’s continued viability.
These include the sub-charter of one of its vessels for at least 12 months, spot sub-charter of vessels for shorter periods between contracts, the issue of new shares to existing shareholders, a reorganisation resulting in the sale for cash of some parts of the company, or a sale of the entire group.
It said OHM was also committed to tight management of overheads, working capital and control of capital spending, adding that it would make further cost reductions next year and was in discussions with various parties that had expressed interest in acquiring the firm.
OHM said the directors believed there were reasonable possibilities that a combination of the planned initiatives could be successfully concluded by the end of February to give it adequate financial resources to fund the planned cost-reduction measures.
It said it also aimed to have financial resources to meet working-capital needs for the near term or to sell the group as a going concern for the benefit of shareholders.
OHM added that the failure to conclude one or more of these initiatives would result in significant doubt over its ability to continue as a going concern, but its latest accounts were prepared on a going-concern basis.
Mr Pratt said: “Controlled-source electromagnetic (CSEM) surveying is a demonstrably value-adding offshore exploration technology, especially when integrated with seismic and other geophysical data. Shareholders will share our disappointment that utilisation of our CSEM acquisition crews and industry adoption of the technology slowed dramatically during 2008.”
This led to reduced revenue of £10.8million, down from £17.73million the year before, and increased pre-tax losses of £8.7million, compared with a £998,000 deficit.
Mr Pratt added: “At the end of the financial year we had cash in hand of more than £8million, however, we will during 2009 require significantly increased revenue and/or a further fundraising to get through this current difficult period.”
OHM employs 125 people, including 40 in Aberdeen. It listed on the Alternative Investment Market in 2004.
Shares closed down 42.2% at 6.5p, having been as high as 202.5p in the past 52 weeks.