Lamprell Recovering from Shareholder Revolt

PUBLISHED: Jun 19 2014 @ 17:49 | Comments (3) | More info about Lou Gutheil

It was less than a fortnight ago, June 11th to be exact, when Lamprell (LSE:LAM) watched the bottom drop out of his share price as investors showed their displeasure with the company’s remuneration report presented at its AGM. On that day, Lamprell’s share price dropped 22 pence (12.9%) to 149.00 just two days after reaching its year-to-date high of 179.00.

After closing at 146.00 yesterday, the share price rebounded to close at 155.00, a gain of 6.16% on the day. More than likely, the re-energizing of the share price has come as a result of the board’s willingness to return, so to speak, to the remuneration drawing board AND the announcement today of having been awarded a new contract by Petrofac Emirates LLC.

Although Lamprell, did not disclose the amount of the contract, we do know that it is let for the “fabrication and delivery of 29 modules” for use in the Upper Zakum UZ750 (EPC-2) po; field in Abu Dhabi, and that the first shipment is expected to be delivered in the latter part of the first half of 2015. The order is expected to be filled sometime in the first quarter of 2016.

The contract is just the kind of good news that Lamprell has needed after suffering a 41% nay vote for the remuneration plan submitted a few days ago, just down the road a bit from Abu Dhabi in Dubai. Really, it was all a technical snafu, and it should be resolved fairly easily. Lamprell’s official statement was that, “We are committed to ensuring that our remuneration policy and, in particular, the long-term incentive plans, takes account of shareholders’ views and at the same time enables the company to implement its strategy through an appropriately incentivized management team.”

Most certainly, the company was much more enthusiastic about announcing the Petrofac contract, noting that, “We have established a strong track record in the offshore and onshore construction sector which is one of Lamprell’s core markets, and we continue to see further growth opportunities.”

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