KCA Deutag - comment

KCA Deutag has confirmed the completion of another component of their Saipem onshore acquisition, with the Kuwait component completing. This is in line with expectations, and just leaves Latam plus Romania and Kazakhstan components to complete, most likely in H1 2023. But as part of the announcement, they disclosed Q4 EBITDA to be c.$75m versus $49m the prior year, and a stronger cash position at $231m, leaving net debt provisionally at $619m. All of these are subject to audit but admittedly exceed our expectations.

This is a positive announcement, confirming the trajectory KCA Deutag is on. The Saipem acquisition was relatively large versus their own business, and it is reassuring to hear the integration and acquisition process is in line with management’s plans.