Foster Wheeler
New orders from Iraq and Egypt
US EPC giant Foster Wheeler is still living in the shadow of its 2009 results, posting first quarter earnings per share of $0.18 for the first quarter of 2011 against $0.56 at the same time in 2010.
Interim CEO Umberto della Sala expects the comany’s books for 2011 to show “marked improvement” over 2010 as revenues from recent new orders come through. New contracts won in 2010 include two major projects in Iraq.
The first is a FEED contract for the new Nassiya refining plant in Southern Iraq for an undisclosed amount, with the facility expected to process 300,000 barrels per day on completion.
The second is project management consultancy for Iraq’s South Oil Company for the construction of two onshore and offshore pipelines and a refining plant, which together are slated to increase Basra’s export capacity from its current output of 1.8 million barrels per day to 3.5 million barrels per day by 2014.
Other signs may be encouraging. New orders booked in the first quarter of 2010 were $562 million against $494 million at the same time in 2009.
In Saudi Arabia, the company will expand Gulf Farabi’s linear alkyl benzene plant (LAB) at Al-Jubail under a $350 million contract.
The new plant will have a production capacity of 100,000 tonnes per annum of LAB.
The company’s Houston operation won a project management consultancy contract from Carbon Holdings for a petrochemical complex in Ain Sokhna, Egypt which on completion will process 1.35 million tons per year of polyethylene.
First quarter 2011 results show profits of $23 million against $72 million at the same time in 2010, and new orders for the quarter down to $381 million from $418 million in Q1 2010.
This is evidence that, even for EPC giants like Foster Wheeler, large contracts are harder – and taking longer – to win. Sala expects 2011 to be a “transition year” for the company.
