Gulf Marine Services (LSE:GMS) has been awarded a variation order by a major national oil company in the Middle East, extending an existing contract covering two vessels by up to a further six years, including option periods. The agreement lifts the group’s contracted backlog to approximately US$700 million, materially improving revenue visibility over the medium to long term.
The contract extension highlights continued strong demand in the region for GMS’s fleet of self-propelled, self-elevating support vessels, which are used in a range of offshore energy operations. Management said the increased backlog strengthens the company’s ability to plan fleet utilisation, supports cash flow generation in the coming years and enhances its platform for pursuing additional contract wins. The deal also reinforces GMS’s strategic positioning within the offshore energy support market as it looks to drive further growth and deliver shareholder returns.
From an investment perspective, the company’s outlook is underpinned by solid operating performance, including strong revenue growth, high operating margins and robust free cash flow generation. Valuation metrics remain relatively attractive, with the shares trading on a comparatively low earnings multiple. Share price technicals are supportive, reflecting a clear upward trend, although elevated momentum indicators suggest the stock may be vulnerable to short-term consolidation following its recent strength.
More about Gulf Marine Services
Gulf Marine Services is a London Stock Exchange-listed provider of advanced self-propelled, self-elevating support vessels to the offshore energy industry. Founded in Abu Dhabi in 1977, the company operates a modern fleet of 15 vessels from bases in the UAE, Saudi Arabia and Qatar. Its assets support a wide range of offshore activities, including platform maintenance and refurbishment, well intervention, offshore wind turbine operations, installation and decommissioning, across markets such as the Middle East, South East Asia, West Africa, North America, the Gulf of Mexico and Europe.
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