The last 12 months have been a time of great change for Xodus Group’s boss – both in the office and at home.
In July, Stephen Swindell and his wife took in two foster children. Their three adult sons had flown the nest a few years earlier.
At the start of this year, he was appointed managing director of Xodus, the engineering and advisory consultancy he helped set up in 2005.
More change was to follow in February, when oilfield service firm Subsea 7 became majority owner of Xodus.
Subsea 7 bought 60% of Xodus, while Japan’s Chiyoda Corporation kept a 40% stake.
Xodus said the stake sale would open doors for the company without compromising its independence.
Mr Swindell said taking on the managing director role after so many years at Xodus was “a nice thing”, and a chance to give the business “fresh impetus”.
“Xodus is on a new path with new shareholders. In many ways, it’s the same at home,” said Mr Swindell, who joked that being responsible for young children again was “like being run over by a bus”.
He said: “It has been a busy last six months. Our sons have been out of the house for the last two or three years, so we ended up with a lot of space.
“My wife is from a childcare background and was interested in fostering. We took in siblings – a five year-old and an eight year-old. We’re adapting to that as a family.”
Mr Swindell is used to adapting by now.
The South African came to the UK on holiday in his 20s, and ended up making the Granite City his home.
He said: “I ran out of money and was looking for a job when I was in London. I was told there was lots of work in Aberdeen, but didn’t know where it was.
“That was in 1990. I got a job as a 27-year-old. My mum is still waiting for me to come home.”
Since then, Mr Swindell has lived through several downturns, but thinks the current downcycle has cut deepest.
He said: “This downturn has been the worst in terms of how long it has lasted. The ones in 1999 and 2008 were bad, but they were short. Everyone suffered for six months and had to cut costs, then the price came back and everyone carried on as normal.
“With this one, we have had three years of readjustment and adapting to new ways of business. We’ve been trying to change the way we offer consultancy services to make money in this environment.
“We’ve gone some way to achieving that, but are still looking for more innovative ways of doing things.
“I’ve been part of Xodus from day one and have been through a lot of restructuring during the downturn.
“We’re now in very good shape and have adapted the size of the business to match what we’re seeing from the market.”
The deal with Subsea 7 should give Xodus a shot in the arm.
Mr Swindell said Xodus would gain access to bigger clients in Subsea 7’s network. The connection should also help it secure more front end engineering design (Feed) and renewables work.
So far, it has been business as usual for Xodus.
“The new shareholders treat us like an independent company,” Mr Swindell said.
“We are making our own commercial decisions. They are letting us get on with business.
“We are having more discussions at management level about different opportunities, but they have not come in and said things are going to be done differently.”
He said Subsea 7 would have been attracted to Xodus by its environmental and advisory capabilities, as well as its subsea offering.
Mr Swindell also said Xodus provided services relating to due diligence around mergers and acquisitions for investors, including banks.
He said the company was busy, but still had plenty of room to grow.
Xodus employs 300 people globally, including more than 100 in Aberdeen.
Mr Swindell said recruitment would be driven by contract wins, but that Xodus was “hoping for a 10% increase in numbers, overall”.
Its plans include a “conscious move to recruit graduates”.
He said business was “picking up” and that more companies were looking at new field developments.
“I am positive about the outlook for the first time in a while,” Mr Swindell said. “We are turning a corner. More oil companies are back in investment mode.
“The oil price is still not very high, so we have to be careful about investing. But investment decisions are being made, at last. Two years ago, no decisions were being made.”
He is excited by a number of projects Xodus is working on, including environmental impact assessments for Woodside and Cairn Energy in West Africa.
Xodus is also engaged with Scottish Enterprise on an assessment of Scotland’s subsea market, is supporting SSE with a number of projects, including cable laying, and is carrying out integrity management work with CNR and Premier Oil.
Xodus is also keeping up its strong links with Japan. The company conducted extensive research used to help Japanese oil and gas companies gain a better understanding of decommissioning.
Mr Swindell said Xodus was a good bellwether for the sector: “We’re seeing more front end work this year than last, which is a good indicator that construction work on installations will be under way in two to three years.
“Xodus is a good indicator. If we feel things are getting busier, it means everyone else will be busy in two years. At the same time, when the downturn hit we ran out of work in two to three months.”
Holding company accounts released by Companies House in September showed Xodus made pre-tax losses of £14.04million in 2016, after losses of £16.3million in 2015, with turnover down nearly £20million at £34.8million.
Mr Swindell said Xodus continued to turn over £30-£34million per year.
He expects maintenance work to hold up, while decommissioning should gather pace.
Mr Swindell added: “My main concern is the lack of exploration drilling. In two or three years, where are the developments going to come from?”
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