Operating losses have widened at North East offshore engineering group Tekmar, amid lower than expected orders.
The cable protection specialist's CEO, Richard Turner, said the business has significant free capacity. Tekmar has offset the slower trading with about £1m of cost savings including headcount management and IT.
First half results for the listed County Durham firm show a £2.3m group operating loss in the six months to the end of March, compared with a £14,000 operating loss in the same period of 2024. That came as revenue fell to £12.3m from £16.2m.
READ MORE: {}
About £8m of revenue came from the offshore wind market, which was lower than the comparable period in 2024, and said to be down to timing of contract awards as the sector recovers from well-publicised challenges. Meanwhile £4m of revenue came from the oil and gas market.
Tekmar told investors it is hopeful of a stronger second half with offshore energy markets said to have "hit an inflection point" with demand starting to increase into the latter part of the year and expected to continue into 2026. Bosses pointed to a £400m potential pipeline, of which more than £50m of projects are scheduled for award in the second half.
Around £18m of funding, via US energy investors SCF, is earmarked for acquisitions with talks said to be under way with potential targets. Since year end, Tekmar has renewed a £4m loan facility with Barclays and secured a £2m loan from the British Business Bank with those funds supporting working capital and going towards the repayment of a CBILs loan due for repayment in October.
Richard Turner, CEO, said: "We remain confident in the strength of our bidding pipeline and expect H2 order intake to be strong, however the build of order book has been slower than we anticipated. Whilst this impacted H1 activity levels it strengthens our visible pipeline for the remainder of the calendar year.
"We have performed very well operationally in the first half of this year with excellent quality, health, safety and environment (QHSE) performance and on time delivery. We have also made solid progress on our strategic plan - strengthening the business and building the platform for sustained growth for 2026 and beyond - alongside maintaining a tight control of cash and cost. However, we still have significant free capacity, and our results reflect this underutilisation.
"Our priorities for the second half of the year are to drive the business to meet our financial commitments for FY25 and win good quality orders that lead to a strong starting backlog for FY26. We continue to engage with potential acquisition targets and will remain disciplined in our approach as we execute on our strategy to deliver true scale and diversification for Tekmar and value for shareholders."