Cuts safeguard Medserv profits as revenues suffer during Misurata siege

Oil services logistics company Medserv said it is ready to restart operations in Misurata in Libya as soon as it is deemed safe to do so and when clients return.

The firm operates support bases for the oil industry in Libya, but its turnover for the six-month period ended 30 June 2011 was nearly halved to €3.9 million compared to €7.2 million in the comparative period last year.

The Group’s results for the first half of the year are lower than forecast with turnover substantially lower than that of the comparative six-month period. However, the company said profit margins on some of the its activities were higher than expected since the uncertainty in Libya saw the introduction of strict cost controls and revised accounting estimates of the useful life of plant and equipment.

This led the group to register a profit before tax of €141,137 compared to €147,753 achieved in the six month period to 30 June 2010. After providing for income tax, the net profit for the period to 30 June 2011 amounted to €125,697 when compared to €196,112 for the six months period ended on 30 June 2010.

Both the Malta base and the Libya base in Misurata have been affected by the continuing instability in Libya. On the one hand, the Malta base has benefitted by being seen as a reliable and safe haven for the relocation of oil field equipment and for facilitating the repatriation of staff employed by oil companies.

Medserv said there has been damage inflicted on its Misurata base but added that it is not serious and can be repaired. Libyan employees still report for duty when possible and have taken steps to protect the base and the company’s and clients’ property.

Medserv’s offshore oil and gas platforms are considered to the first operations to restart, being served from the Malta base.

“The Group looks forward to the restarting of the planned programme for drilling production wells in the offshore Bouri field when hostilities cease, and to the commencement of existing planned programmes of international oil companies.”

The Malta base was responsible for the evacuating of most of the workers situated on the oil platforms offshore Libya.

On the other hand the Misurata base has not operated fully for some months. There is a substantial amount of equipment owned by oil companies on the base which remains undamaged and for which storage is being charged.

The Medserv Malta base has supported the humanitarian relief job for Misurata in collaboration with SOS Malta and SOS Tunisia. The Group has warehoused 20 40-ft containers free of charge at their base.