LONDON (ShareCast) - (ShareCast News) - Pressure Technologies issued a dire warning about the state of oil and gas services on Wednesday, signalling its struggle through the first six months of the trading year were even more difficult than previously anticipated.
The AIM-traded company had highlighted difficult trading conditions in the oil and gas market at its February AGM, and at the time indicated that no significant pick up was expected this year.

On Wednesday it said that its businesses in the sector have since experienced a further, substantial decline in orders in the second quarter, which has been complicated by unpredictable demand and very short lead times.

"Despite some recovery in oil prices, the outlook is for a slow recovery, particularly as oil inventories remain at historic highs," Pressure's board said in a statement.

"Capital expenditure for oil exploration and production remains under pressure with further cuts possible this year and we now anticipate the pick up in this market to be delayed into 2017."

The firm was continuing to align costs to trading conditions, but said there was no escaping the effect of the downturn and the difficulty in trying to call when the 'bottom' of the cycle occurs.

There was an upside in its alternative energy division where it said prospects remained strong, although the timing of contracts was still a significant factor in determining the outcome for the full-year.

"Reflecting the board's continued caution, we therefore now anticipate that the result for the year ending 1 October will be substantially below current market expectations," it warned.

"[We] remain confident in the medium to long-term prospects for the group and believe that when the oil and gas market returns it will present considerable opportunities."

In the meantime, Pressure's board said it will take "whatever measures necessary" to ensure the resilience of the business, whilst continuing to invest in the future of the company and implement the strategic objectives to broaden its customer, technology and industrial bases.

Email this article to a friend

or share it with one of these popular networks:

• DIGG
• FACEBOOK
• STUMBLEUPON
• MIXX
• YAHOO BUZZ
• DELICIOUS
• REDDIT
• NEWSVINE