Dec 20 (Reuters) – Oilfield services provider Petrofac Ltd (PFC.L) on Tuesday forecast an annual operating loss of nearly $100 million due to challenges in recovering costs at its engineering and construction (E&C) division.
The group expects its largest division E&C to post an annual operating loss of around $190 million, as the division’s performance was hit by higher costs due to contracts extended during the COVID-19 lockdown.
“The additional costs incurred on contracts due to the extended schedule have not been fully recovered from our customers, resulting in increased net costs,” Petrofac said in a statement.
Revenue from the E&C division fell 40% in the first half. The division had posted an operating loss of $14 million in 2021.
Petrofac said it was also working with partners to recover the cost of its $4 billion joint venture Thai Oil clean fuel contract.
Petrofac chief executive Sami Iskandar is set to step down at the end of March 2023 and will be replaced by Tarek Kawash, a senior executive at energy firm McDermott.
Reporting by Muhammad Hussain in Bengaluru; Editing by Dhanya Ann Thoppil and Sherry Jacob-Phillips
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