Doha: Gulf International Services (GIS), one of the largest services groups in Qatar, is well-placed to improve its performance in terms of revenue and profitability in 2020 on the back of public-sector initiatives such as Qatar’s North Field Expansion (NFE) project, the 2022 FIFA World Cup and Qatar’s 2030 National Vision plan, all of which are supporting the positive outlook for Group, noted the Chairman of GIS, Sheikh Khalid bin Khalifa Al Thani, yesterday.
Sheikh Khalid, in his address to the Group’s shareholders also noted that GIS as a key service supplier to the oil and gas sector, the demand for its services will improve its market share across all the segments despite the outbreak of COVID-19 disease which caused worldwide lockdown.
“As we enter the year 2020, despite of the current pandemic situation due to the spread of coronavirus (COVID-19), where currently work is in progress to assess its business impacts, but what I can assure you is that the Group will continue to pursue its core objectives of reducing operating and financing costs, better utilisation of assets, increase our market share in Qatar and enter new international markets,” said the Chairman addressing the Company’s Ordinary General Assembly Meeting, yesterday.
He added: “Our top priority would be to reposition the Group’s core oil and gas services business, by minimising costs and maximizing asset utilisation, in order to become more efficient and better able to leverage our domestic and international strengths to increase market share and shareholder value.” The AGM, which was conducted electronically through a conference call, approved all the items on the agenda of the meeting, including the Board’s recommendation for no dividend payment for the financial year ended December 31, 2019.
The Chairman said that GIS, despite facing the macro-economic headwinds and other challenges, is on the repositioning drive and its performance is on the right track as a result of initiatives taken over the past years as part of key pillars of strategy and improving efficiency.“2019 was a strong year for GIS, a year of growth, improved efficiency, our return to profitability from losses in previous year, and our strategic expansion into new markets.
GIS improved set of financial and operational result was led by the Group’s focus on high utilisation of assets and continuous efforts to rationalise operational costs. Overall, the Group saw net income surge 144 percent during the year from 2018 levels, allowing GIS to return to a full-year net profit in 2019 of QR44m”, Sheikh Khalid said.
Mohammed Jaber Al Sulaiti, Manager Privatised Companies Affair, at Qatar Petroleum (QP), a major shareholder of GIS, delivered the Board of Directors speech, highlighting key performances of the Group in 2019.
“Revenues in our aviation segment rose 8 percent during 2019 compared to last year to reach QR586m, and net profit rose 2 percent to QR143m. Some of the key performance highlights of 2019 for the aviation segment included the winning of a short-term contracts in Africa, Europe and Middle East; improved performance of Turkish subsidiary; the domestic aviation business, continued its positive business trajectory; and acquired 49 percent stake in Air Ocean Maroc, which is currently looking at opportunities in Morocco, Western Africa and South of Europe,” said Al Sulaiti.
“Specifically speaking in terms of our segment wise future strategy, the Group would continue to concentrate on its core oil and gas services segments i.e. drilling and aviation services, where efforts will continue to unlock future growth opportunities, especially in terms of increased demand envisaged due to the NFE project, in order to enhance our market share domestically, as well as, look into international opportunities. In specific, the aviation segment will continue to focus on key international markets, which provides opportunities in oil and gas aviation service sector,” he added.
“Our priorities will remain resolute in repositioning the segments and enhance the overall utilisation of assets, along with continued rationalization programs which could provide avenues of cost savings and making sure our organizational structures remained at the optimum levels.” He said that GIS is currently in the process of restructuring and refinancing the debt of its wholly owned subsidiary – Gulf Drilling International (GDI), which would allow an opportunity to the Group in terms of optimum sustainable debt and capital level, along with streamlining the overall maturity profile.
The total debt subject to restructuring and refinancing will amount up to $1.3bn. Under the new terms, the Group will be optimising its finance cost. The refinancing exercise will allow the Group to re-adjust its maturity profile for sustainable future.
Underpinned by management business plan, this new debt structure would allow for gradual deleveraging of the Group’s financial position, he informed to the shareholders.
