The market for oil and gas research will remain weak in the short term; any improvements in this market will come with increasing oil prices. This affects our opportunities for obtaining sufficient industry support, especially for our innovation projects. The activities of Ullrigg Drilling and Well Centre in the development and testing of new equipment may also be further affected by negative market developments. For IRISForskningsinvest AS, this situation may make it more difficult to attract funding for the commercialisation of research results.
Credit risk connected with customers’ ability to fulfil their obligations has been low historically, and at the end of 2015 it is still assessed as moderate, even though many of the company’s customers are also affected by the downturn in the oil industry in the region.
The company is exposed to interest rate risk to a moderate extent, since debt to credit institutions is relatively low, while the company’s active pension plan has been changed from defined benefit to defined contribution. Rental costs for buildings will to some extent be dependent on interest rate developments, but the rent is expected to be unaffected in the short and medium term.
Working capital has shown a positive trend in recent years, but is practically unchanged for last year.
The board will continue work on increasing capital from the company’s operations as a basis for investment in laboratories and plant and to further strengthen the company’s solvency.