Shares soar in Kentz on back of €2bn orders backlog
SHARES in the Clonmel-based global engineering group Kentz soared as much as 12pc yesterday after the company said that it continued to trade strongly and that its order backlog now stood at $2.5bn (€2bn).
The company, which is listed in London, saw its share price rise about 7pc soon after the open but it later jumped, valuing the group at €422m.
However, despite the rise, the shares were still trading down over 17pc compared to their highest level in the past year.
Kentz provides engineering services to firms such as Shell and Rio Tinto in the oil and mining sectors. Much of its current work is undertaken in Australia and the Middle East.
"We have experienced very little in the way of delays or cancellations to any of the prospects in our current pipeline of opportunities and certainly none that have had a material effect on the group or our outlook for 2012 and 2013," said its chief executive Christian Brown.
He added that despite current volatility in world markets Kentz continued to see strong demand for its services and that the group's "broad base of clients, diversity of operations and significant global footprint" would work in its favour.
Kentz said that despite the recent fluctuations in the price of oil, many of its clients took a long-term view and made a strategic evaluation of oil prices over time in order to be able to to grow their reserves and production.
Last month, following the company's release of its interim management statement, broker Investec upgraded its 2012 earnings per share forecast for Kentz by 5pc.
Investec noted at the time that Kentz's shares had suffered from a derating as oil stocks declined.
It reckoned that Kentz shares had a fair value of £6 (€7.44). Yesterday afternoon they were trading at £3.62 (€4.49).