Plexus shares surge after securing £5m order
Engineering services business Plexus has secured a £5.0m has secured an order for its proprietary POS-GRIP HG wellhead equipment and sealing technology for a specialised project application.
Plexus said approximately £2.5m in milestone payments will be received and accounted for as deferred revenue in the current financial year, while the full value of the contract will be recognised as sales revenues in the twelve months ending 30 June 2024.
The AIM-listed group will supply the equipment on a rental basis, with part of the equipment deployment required for the project to be the operation of POS-GRIP components in a subsea environment, including leak proof metal to metal HG seals.
Chief executive Ben van Bilderbeek said: "I am delighted that our Aberdeen team have been able to use their exceptional engineering and equipment design skills to secure this major contract, which significantly increases the visibility of our future revenue and cash flow projection.
"As the oil and gas markets emerge from eight-years of recession, during which time Plexus has had to sit out a three year non-compete period before being able to return to the previously profitable rental exploration wellhead sector, we had to adapt our remaining business to cope with the market downturn. Encouragingly, as evidenced by today's announcement we are now experiencing an increasing number of enquiries, including for our revamped Exact EX exploration rental wellhead and mudline hanger technologies, which are offered in partnership with Schlumberger on a worldwide basis. I believe Plexus is finally turning the corner and will prosper in the coming years, both organically, and with major technology licensees"
As of 0955 GMT, Plexus shares had surged 50.88% to 4.30p.
Reporting by Iain Gilbert at Sharecast.com