Subsea 7 Racks Up Big Backlog, Announces Surprise Dividend

16 March 2012

Norwegian oilfield engineering group Subsea 7 announced a bright outlook and record backlog and said it would both buy back shares and hand out a bigger-than-expected dividend after fourth-quarter earnings lagged expectations.

Adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) came in at $227 million for the quarter, including extraordinary write-downs, compared to a mean forecast for $260 million in a Reuters poll of analysts.

But the firm said it saw increased demand in its key North Sea and U.S. Gulf of Mexico markets and said its backlog of projects had reached a record $8.5 billion, compared with an average forecast of $8 billion.

It proposed a special dividend of 0.60 Norwegian crowns per share, while the mean forecast had been for 0.09 crowns and the median for zero. It also said the board had authorised a share buyback programme of up to $200 million over the next year.