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Africa Oilfield Logistics Ltd, the AIM listed African focussed support services and logistics company, has issued a trading update from the company’s primary investment, Ardan Risk & Support Services.
Highlights:
· Revenue (unaudited) of approximately $9.5 million for the four month period ended April 2014 representing an annualised run rate of $38 million and a 65% increase on the unaudited 2013 revenue of $23 million.
· Operational restructuring of Ardan (as overseen by Africa Oilfield) completed, resulting in significantly enhanced key performance indicators and financial performance.
· The focus on operational professionalism and maximising efficiencies for clients has resulted in:
o an expansion in the scope of current contracts with existing clients, including international oil and gas companies.
o numerous new business opportunities becoming available.
· Strong trading environment in the East African region provides Ardan with opportunities to significantly increase its position in Kenya and Ethiopia as well as contemplate future expansion into Madagascar and Djibouti.
Carl Esprey, Chief Executive Officer of Africa Oilfield, said: “Increasing year on year revenue run rate by 65% is a tremendous achievement, which can be attributed to the important structural changes made within Ardan and the key management appointments at Africa Oilfield in recent months. We are now ideally positioned to capitalise on the rapidly expanding energy and natural resource industry in East Africa. Ardan offers a highly professional, international standard and end-to-end solution to clients, which differentiates it from its competitors. I look forward to providing further updates regarding Ardan and our growth strategy in due course and remain confident that the strong structural foundations which have now been implemented at Ardan will continue to translate into strong financial performance.”
Further Details:
Ardan, Africa Oilfield’s primary investment, continues to operate in a highly attractive environment with a well-established and highly regarded reputation in Kenya and Ethiopia as a pre-eminent supplier of natural resource focussed support services in East Africa.
The restructuring of Ardan is now yielding positive results with improved efficiencies, professionalism and controls, increased visibility of the end-to-end offering for clients and elevated cross-selling opportunities within Ardan. These factors have increased Ardan’s annualised revenue to $38 million (unaudited 2013: $23 million) with improved efficiencies benefiting margins and facilitating expansion initiatives. The Company is now in a position to consider extending its geographic reach to include countries such as Djibouti and Madagascar and will provide further news in this regard in due course.
Trading conditions in Kenya and Ethiopia remain very strong, and Ardan’s customers have been receptive to the newly restructured business which provides international standard support services to energy and natural resource companies through three divisions:
· Technical (encompassing civil engineering, workforce accommodation and construction);
· Services (covering medical and facilities management); and
· Logistics (which includes fuel solutions, storage and transportation).
Client feedback has underpinned the Board’s confidence that it is positioned to become a leading professional and efficient turn-key development and support services group in Africa.
The Company and Ardan have an enormous platform to build upon: the natural resources sector continues to expand and investment in this field continues to flow into the East African region. As a premier support services business to these companies, the Board is confident that Ardan can deliver continued meaningful revenue growth moving forward as it continues to elevate its reputation in the industry and deliver further major contracts.
