Renaissance Services has declared its interim results for the nine months ended 30 September 2011. Renaissance has achieved revenues of US$ 535.6 million, an increase from $ 486.5 million, or 10%, recorded in the corresponding period last year.
Samir Fancy, Chairman of Renaissance Services, stated in the quarterly statement, “Renaissance has a strong track record of 10 consecutive years of delivering growing profits. However, in 2011 we experienced a number of setbacks. Nevertheless, continuing revenue growth underlines the enduring value of the Renaissance franchise. The company’s EBITDA and Operating Profit have remained positive despite losses in the Engineering business. The improving performance of key business areas demonstrates that the company has arrested the temporary decline of 2011 and the turnaround towards positive business growth is well underway.”
Fancy said the new management team of the engineering business is making good progress in addressing its temporary losses. “The declining trend is slowing and reversing. Losses, which peaked at $7.8 million in Q2, have been contained at $2.9 million in Q3.”
The chairman added that the company has succeeded in getting key projects back on schedule, with positive success.
“They have restored the 100% customer-focus ethos at which this company excels. The business has been restructured and streamlined with significant savings in overheads, and increased investment in process control and professional project management. These actions have already contributed to a reduction in losses compared to the prior quarter.”
“Through these changes the break-even threshold for the Oil & Gas Engineering business has been reduced to$ 121 million; although the break-even for 2012 will be $154 million due to the low gross margins on some contracts which have been carried over to early next year.”
The break-even for the Marine Engineering business has been reduced to $47 million. The 2012 backlog of business already in hand for Oil & Gas Engineering is US$70 million and for Marine Engineering is $17 million. With several contract opportunities under positive review, the backlog is likely to increase before yearend 2011, and we expect to achieve a break-even position for the Engineering business for 2012.”
Speaking of the company’s marine business, Fancy said: “The business continues to perform well, although the Q3 result has been tempered by additional expenses arising in this quarter and scheduled downturn in utilisation for dry-docking and maintenance. Independent market analysis predicts strengthening rates and utilisation in spot markets over the coming year, and the company is witnessing clear signs of the start of a more positive trend.”
