For our 3rd consecutive financial year, our customer base in the Oil & Gas sector has had to endure challenging operating conditions as the oil price has remained under pressure, with many now accepting that the oil price is likely to be “lower forever”. This pressure has impacted the wider economies in two of our major operating locations, Aberdeen & Houston and prosource has not been immune to that wider impact. However, we continue to benefit from high customer retention and the predicted modest Group growth that we forecast has been achieved.
Pent-up demand translated into increased project activity at several of our customers and that combined with a slew of M&A activity and some new customers all contributed to Group growth of just over 10% on a constant currency basis. As a result of our overseas operations and the exchange rate benefits as a result of BREXIT, our accounts show a slightly higher annual growth of just over 14%.
Once again, Group pre-tax profits were maintained at just over 10% as we continued to keep close control on our cost base to ensure we remain competitive during this period of prolonged challenge.
During fiscally testing times, it can be easy to focus on the company’s commercial aspects at the expense of other activities. So, we would like to thank our staff for another year of safe performance with no harm to people or the environment. Working safely is fundamental to our Operating Procedures and requires constant vigilance and effort.
We are privileged to maintain our our ongoing sponsorship of the Gathimba Edwards Foundation, a fantastic charity that is literally changing the lives and life chances of the neediest children in Africa. For more information, see www.prosource.it/gathimba-edwards-foundation.
More than a year on from the BREXIT vote, we have not experienced and nor do we expect to experience any material impact on the company, other than the general uncertainty that clouds the business world and economy in the UK. Being UK based with a cost base denominated in Pounds, prosource is in a competitive position to deliver into Europe as and when project activity demands and the ongoing devaluation of the Pound against the US Dollar has delivered improved Group revenues and profits as the US contribution is converted to Pounds
Looking forward over the next 12 months, our current project delivery orderbook continues through financial year 2017/18 and we are witnessing increased demand from some key new customers. As such, we enter the year with a degree of confidence and an expectation of further revenue growth of magnitude 10%, despite the ongoing Oil & Gas sector difficulties and the impact that has had on our customers and the wider local economies.