Amec Sees More Acquisitions, Higher Dividends on Earnings

Amec Plc (AMEC), the U.K.-based oil and gas engineer, said it will continue to make acquisitions and increase payouts to shareholders as earnings rise.

Adjusted profit before tax in the first half rose 9 percent to 126 million pounds ($206 million) from 116 million pounds a year earlier, the company said in a statement in London today. Amec increased the dividend 40 percent after making 261 million pounds of acquisitions in this year.

Amec said its order backlog is similar to a year ago at about 3.4 billion pounds and it will be able to maintain margins at about 9 percent for the year. Shares have declined about 17 percent since July on concern that a slowdown in global economic growth may curb oil prices.

“We see demand for our services remaining strong,” Chief Executive Officer Samir Brikho told journalists on a conference call. “We still see a lot of opportunities out there.”

Chief Financial Officer Ian McHoul said Amec plans to increase the dividend in line or “a little ahead” of earnings growth. The company “sees opportunities” to maintain the pace of investment and acquisitions, he said.

Amec plans to return to Libya “as soon as the dust settles,” Brikho said. The company evacuated most of its 230 employees in Libya earlier this year after civil war broke out. The North African country is a “great opportunity,” he said.

Total profit fell to 79 million pounds from 89 million pounds in the first half of last year after a 22 million-pound tax charge, Amec reported.

Shares fell 4.3 percent to 876 pence as of the 4:30 p.m. market close in London.

To contact the reporter on this story: Brian Swint in London at bswint@bloomberg.net

To contact the editor responsible for this story: Will Kennedy at wkennedy3@bloomberg.net

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