Sparrows Offshore Group toasted success in new markets and celebrated further overseas expansion as it reported growth in underlying profits yesterday.
The Aberdeen firm said it was doing more work with renewable energy and onshore industrial clients, beside its more traditional offshore oil and gas
Sparrows, which supplies cranes and other specialist engineering equipment and integrated services globally, also highlighted a new joint venture in Ghana.
Underlying profits grew to nearly £6.2million last year, from £5.8million in 2015, although turnover was down by almost 25% due to the “challenging” trading climate in oil and gas markets.
Sparrows employs 1,600 people around the world, including 900 in Aberdeen, and is now hiring again after shedding jobs amid the oil and gas downturn last year.
The Bridge of Don-based company said it was “cautiously optimistic” about the year ahead due to the number of long-term global contracts it has secured over the past 12 months.
These include support for the East Anglia ONE offshore windfarm and new projects in west Africa, Australia and the Middle East.
The firm also won a 10-year contract renewal with BP in the North Sea and secured work on major projects in the area for Maersk Oil and Statoil.
Revenue in 2016 was split 53.9% for the UK and 46.1% for the rest of the world, which Sparrows said highlighted “continued successes both domestically and internationally”.
Chief executive Stewart Mitchell added: “We have strengthened our business model through a well-considered restructuring programme which has secured the company’s position in the marketplace and safeguarded jobs for the future.
“Our improved cost control and recent operational performance, combined with a robust portfolio of ongoing campaigns and contract wins, has put us in a favourable position to capitalise on new regions and areas the company is moving into, such as the renewables sector.”
Sparrows said statutory pre-tax losses of £46.9million last year – after a deficit of £30.9million in 2015 – were mainly due to non-cash goodwill amortisation and finance charges.
The firm reported a “healthy” cash balance of £21million, up from £18million previously.
Its new joint venture in Ghana, with local firm Hydra Group, represents maiden business for the group in the west African country.