Offshore engineering firm Aker Solutions expects revenues to decline thanks to “considerably” reduced activity from operations due to the Covid-19 pandemic fallout.
The Norwegian company, which has a number of facilities in Aberdeenshire, said it anticipates its 2020 revenues to decline by a minimum of 20% compared to its outlook at the end of 2019.
But the firm added that it was doing its “utmost” to secure jobs and to mitigate the effects for customers, shareholders and other stakeholders worldwide.
It said it had temporarily laid off 250 staff in the UK and 400 in Norway.
Aker Solutions said it had the resources, assets and ability to maintain current and new activity levels initiated by clients.
The firm’s chief executive, Luis Araujo, said: “The first months of 2020 have been unlike anything we have previously experienced.
“The COVID-19 pandemic, coupled with the sharp drop in demand for oil and gas, has caused significant disruption to the global economy and left societies around the world grappling with new ways of working and living.
“The global energy sector has been hit particularly hard, and at Aker Solutions we are doing our utmost to mitigate the effects for employees, customers, shareholders and other stakeholders worldwide.”
Aker Solutions said it had introduced measures to reduce the company’s cost and investment level.
It added that it will now accelerate and deepen cost saving measures as it looks to reduce the company’s fixed cost level by £58 million.
The firm also said it investment level would also be reduced from around £60m to £40m in 2020.
Mr Araujo added: “While it is too early to predict the long-term impact on financial markets and industrial activity level, the current market situation is expected to have an adverse impact on both activity, financial performance and structure of Aker Solutions in 2020.
“A large part of the planned project sanctioning activity in the oil industry will most likely be postponed or cancelled in 2020 unless governments are introducing significant fiscal stimulation to aid in the recovery.”
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