KCA Deutag - comment

KCA Deutag continues to build on its recent contract wins, and coupled with the integration process of the Saipem Onshore Drilling business, move into FY24 with a backlog of $5.6bn, or 3.6x LTM Revenue ($3.5bn firm or 2.2x revenue). This backlog and improved EBITDA results in KCA exploring options for its balance sheet, including refinancing of the Group’s debt and a potential public listing in the Middle East.  Leverage has reduced to 1.7x, which further emphasises that KCA Deutag have the wrong balance sheet.  We would expect a holistic refinancing with a potential public offering during FY24, and likely to be in the next couple of months.