The Chairman, Nerolie Withnall said the result represented a solid outcome in current market conditions and demonstrates that the Group’s focus on its cost base, maximizing market share, and continuing to execute its long-term strategies of market sector and geographical diversification is working.
Overview of FY2015 Result
“Markets for our services remain challenging in an environment of falling commodity prices and a strong cost focus from most clients.
Commenting on the full year result, Managing Director, Greg Kilmister said that the operating profit in both the Life Sciences and Industrial Divisions showed some improvement over last year, whilst the more cyclical, resource exposed Minerals and Energy Divisions saw EBIT deteriorate in line with market movements.
“Geochemical and Metallurgy sample volumes in ALS Minerals declined during the year with North and South America the most affected.
While ALS Life Sciences and ALS Industrial achieved small organic revenue gains during the year ALS Energy’s revenue growth reflected the first full 12 months’ contribution from the Oil and Gas business.”
Contribution margins remained under pressure from competition across all business streams but the impact of this was buffered by the Group’s focus on managing costs to suit market conditions.
“Market conditions are unlikely to change in the short-term and management remains focused on ensuring our operating model and strategies are aligned to market conditions.”
Outlook for FY2016
The Group is committed to maintaining the strong and sustainable growth strategies which have made it a successful global company.
Despite the impairment to the Company’s oil and gas investments taken in FY2015, the upstream oil and gas markets remain very attractive to ALS and we are confident of achieving our long-term goals in the sector. The Group will continue to implement its oil and gas strategies including the opening of a large new laboratory in Houston, Texas in the second half of FY2016.
The Life Sciences division has plans to acquire small food testing businesses in Europe and North America to complement the acquisitions made during FY2015.
The Industrial division is engaged in several significant tenders to secure increased market share, while the Minerals division expects to gain ongoing market share through technology leadership, quality and innovative service delivery.