Oil mapping firm Getech reported a doubling in annual profits, but warned that uncertainty in a tough market will hit trading in its new financial year.
The Leeds-based group said that trading will be “substantially below” current market expectations following the global fall in oil prices.
The group made a pre-tax profit of £2m in the year to July 31, up from £1m the previous year after revenue jumped 32 per cent to £8.6m.
Chairman Stuart Paton said: “For the exploration and production sector, the financial year 2014-15 has proved to be even more challenging than the previous financial year.
“The reduction in exploration expenditure we had observed in 2013-14 has been followed by a very significant drop in the oil price in the last year. This oil price drop has led to significant reductions in capital expenditure across the whole exploration and production sector, and major redundancy rounds in many companies.
He said that against “this very difficult backdrop”, Getech has performed well, but the group believes this year’s trading will be substantially below current market expectations.
Analyst Eric Burns at WH Ireland said: “Getech’s operational gearing – which serves it well in favourable times – means we are now forecasting a current year PBT of £700,000, a material reduction from our previous £2.7m forecast. Arguably Getech is outperforming many of its peers in the oil and gas service sector which are reporting losses.”