Renewable energy turned out to be the bright spot of Aqualis’ first quarter results, as the challenging market conditions in the oil and gas sector affected the company’s business.
Aqualis ASA, which operates three specialised subsidiaries – Aqualis Offshore, Offshore Wind Consultants and ADLER Solar – recorded EUR 6 million in total operating revenues in the Q1 2016, 40% down from EUR 10 million in the same period last year. Loss after taxes amounted to EUR 2.1 million, while a profit of EUR 1.2 million was reported for the same period in 2015.
The activity level in the oil and gas market, as well as the market for new large engineering and construction work, according to the company. Furthermore, the service industry as a whole is increasingly competitive, Aqualis said, and most of its service lines have experienced lower demand. However, bidding levels on smaller jobs within marine sectors have strengthened.
David Wells , CEO of Aqualis ASA said: “The O&G market started the year slower and weaker than we expected, particularly in January and February, but we have been encouraged by the recent numbers of small consultancy opportunities that we are identifying and winning in this tight market.”
On the other hand, Offshore Wind Consultants’ position has strengthened in a tightened market and it is continuing to build and expand its client base. Offshore wind market in Northern Europe has a reasonable project pipeline predicted through to 2020 and, further ahead, market potential will be explored in other areas including China, Taiwan and Thailand, Aqualis stated.
“Year 2016 is going to be challenging for the whole industry but there are some exciting opportunities. By contrast the markets for offshore renewables and solar have started the year firmly justifying our decision not to rely on a single market,” Wells said.
Demand for ADLER Solar’s services is typically weaker in the winter months, with PV market in the UK slowing down in Q1 2016 due to reduction in feed-in tariffs. However, there has been increasing interest for O&M services in Japan. “Market demand for ADLER Solar’s services has historically been strong during the spring and summer months in Germany and should continue to grow as the installed solar farms age,” Aqualis said.