Hunting plc - Solid start, momentum expected to build from Q2
The AGM update commentary is reassuring. Based on order book development, increased activity levels and improved mix, EBITDA progress for the year is anticipated consistent with previous guidance. Hunting appears to be on track for delivery of its 2030 targets and gathering momentum over the remainder of 2026 would serve to support this view.Management noted that trading was in line with expectations in Q1 26 with all product groups performing as anticipated. Reflecting order book development and business mix, Q1 26 EBITDA came in at U$23.2m, with a 10% EBITDA margin.
Orders on hand have rebounded to U$429m (from U$358m at the end of December) including c. U$68m new Subsea business announced on 7 April. Related inventory build, together with an estimated U$27m share buybacks, resulted in a c. U$54m net cash outflow in Q1.
Our Hunting estimates and fair value / share of 502p are unchanged. We see sustained order book growth and further positive Subsea business development as possible triggers for upside in valuation calculations.
Hunting is a holding company. Co.'s segments are: Hunting Titan, which provides perforating products; U.S, which supplies connections, oil country tubular goods (OCTG), drilling tools, subsea equipment, and intervention tools, among others, for the U.S. and overseas markets; Canada, which manufactures connections and accessories for operators in Canada; Europe, which supplies OCTG and well intervention equipment to operators in the North Sea; Asia Pacific, which manufactures connections and OCTG supply; Middle East, Africa and Other, which sells intervention tools in the Middle East and Africa; and Exploration and Production, which comprises its exploration and production activities.
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