Petrofac are on track for investors

As oil and gas facilities services provider Petrofac reports performance in line with expectations, Graham Spooner, investment adviser at The Share Centre, explains why the company is attractive for investors.

"This morning Petrofac reported it was on target to deliver 15% like-for-like net profit growth in 2011, following a successful first half of the year.

"The company's track record at winning new contracts has always been favourable for investors seeking growth and they should be pleased to see this continuing in 2011. The group's order intake for the first half of the year to 30 June stood at $2.1bn with new contracts in Algeria, Malaysia and Iraq.

"The group's offshore and engineering operations have performed well during the first half of the year and they expect substantial growth in revenues and profits in this area going forward. Investors will be encouraged by the company's expansion in to new regions as oil prices and the demand for energy increases.

"As a result of strong performance, investors should be aware that the share price is on a high rating, however we feel it still has long term attractions, rather than being a short term play. It is worth noting that due to these highs, if the company faces any problems in the future and shows signs of slowing, the share price could suffer.

"The company remains a ‘buy' for us and is well positioned to pick up its share of new contracts, which continues to attract investors making it a play in the sector."