Activity levels improved in Q2

Improving momentum from Q2, which has continued into Q3, helped to deliver a satisfactory outcome for the interim results. With the loss-making US business closed, encouraging activity in the EuAm region, a strong performance in the Middle East pipeline and rising utilisation levels, we remain increasingly confident the Group will hit FY25 expectations. The improved strategy, coupled with the healthy balance sheet, has enabled the Board to fund an attractive dividend as well as to return cash shareholders via share buybacks.

Our valuation combines peer group comparison models and the level of net cash. The latter equates to 23.7% of the Group’s market capitalisation, valuing the operating business at 7.5x FY25 EBIT, well below sector averages (source: Koyfin). We maintain our fair value/share at 35p to reflect unchanged estimates and note the high dividend yield as an added attraction for investors.