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Authoritative Independent Monthly Share Selections Using Technical & Fundamental Analysis

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Petrofac - Backlog twice covers revenues

October 2011

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • PFC
  • Price:
  • 1413p
Although the shares have pulled back due to political unrest in the Middle East and North Africa, Petrofac's interims were slightly ahead of expectations. In the six months to 30 June revenues rose 25% to US$2.7bn while profit after tax increased 6.6% to US$246m, ahead of consensus forecasts for US$236m. Net cash increased to US$1.77bn, up from US$0.6bn in June 2010 while its order backlog of US$11.4bn represents almost two times expected full year revenues. Crucially management have reiterated they expect net profit to increase 15% for the full year. In the engineering & construction business, which provides process, mechanical and structural engineering for infrastructure projects such as construction of gas plants an ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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