International energy services provider Hunting has made further job losses as it continues to battle the dual impact of the Covid-19 pandemic and the oil price slump.
Earlier this year the firm announced it was carrying out restructuring and had axed around 25% of its global workforce in response to the challenges facing the sector.
On Tuesday it revealed that figure had increased and, as part of efforts to “resize the group”, the workforce had been reduced by 30% since the start of this year.
However, Hunting chief executive Jim Johnson claimed that the firm’s “decisive actions” had been successful in leading to a broadly break-even EBITDA for the third quarter and a “continued strengthening” of the firm’s balance sheet.
The firm’s global headcount dropped by more than 600 to 2,332 between January 1 and the end of June.
Mr Johnson also revealed the group, which has a base in Portlethen near Aberdeen, is exploring potential “bolt on acquisition opportunities”.
In its third quarter results, Hunting posted EBITDA of $28 million (£21.5m) for the year to date.
The group also maintained its balance sheet was in a “strong position” of $69m (£52.9m), with working capital continuing improvements continuing to generate cash.
It also paid out $3.3m (£2.5m) as part of its second interim dividend, the equivalent of 2.0 cents per share.
Inventory levels at the end of the quarter were $315m (£241.9), a reduction on the end of 2019, while capital investment continued to be low, with the group reporting year-to-date expenditure totalling $13m (£9.9m).
However, Mr Johnson claimed that in certain sub-sectors of the market green shoots of recovery were beginning to emerge and that the group is reaping the benefits of its more active subsea sector.
He said: “In the most challenging environment ever faced in our industry decisive actions to resize the Group have been successful leading to a broadly break-even EBITDA result, a continued strengthening of our balance sheet, and an ongoing commitment to deliver industry leading service and technology to our customers.
“Third quarter results reflect the low levels of activity caused by the impact of COVID-19 on global energy demand. Clients have continued to curtail drilling and completion activity in the period.
“However, we believe that in certain sub-sectors of the market, including areas of the US onshore market, activity levels have now stabilised. Our recent acquisitions have increased the Group’s position within the more active subsea sector and are already yielding benefits.
“Monthly revenue has increased within the Hunting Titan and Asia Pacific segments during the quarter, however, this has been offset by declines in revenue within the US and EMEA segments. Improving sales into international markets by Hunting Titan have continued to expand Hunting’s geographic footprint which partially offsets the performance of our North American business. Given the prevailing levels of activity, management believe that the revenue run rate for Q4 may be slightly lower than Q3 due to the usual seasonal slowdown.
He added: “Our efforts to resize the Group in response to prevailing market conditions have resulted in annualised cash savings totalling c.$74m (£56.8m), with the global workforce reducing by c.30% from the 2019 year-end.
“Our strong balance sheet and improved net cash position also allows the Group optionality to explore further bolt-on acquisition opportunities. The growth of our subsea segment over the past 14 months demonstrates the success and rationale of this strategy.
“Client activity should improve during 2021, but a sustained recovery in the market will be a function of the decline in COVID 19 driving positive global economic activity. The effects of the pandemic continue to depress demand and weigh heavily on oil price sentiment.”