West Texas Intermediate (WTI) decreased by 40% over Q4-2018 and wiped out the entire gains of the year, ending with a loss of 24%. This negatively impacted the entire oil and gas sector (down 18.3%) over the year, especially affecting diversified Oilfield Services (OFS) (down 54.4%), drilling (down 41.9%), and offshore drilling (down 36.6%). Over the same period, the best performing sectors were equipment-focused OFS (up 20.1%) and diversified pipelines (up 3.2%). The average LTM revenue and LTM EBITDA multiples in 2018, for the oil and gas sector overall were 1.6x and 7.3x, respectively.

During Q1-2019, WTI rallied by 31.8%, returning to the same price level as January 2018. The oil and gas sector (up 19.1%) saw overall recovery over the past quarter. Except for refined products pipelines, every subsector performed positively. Best performers were diversified midstream (up 51.8%) and service-focused OFS (up 32.0%), while the worst performing sectors were refined products pipelines (down 14.6%) and offshore transportation (up 7.4%).

The M&A environment stayed positive, resulting in 12 M&A deals over the past quarter, where the average EV/Revenues and EV/EBITDA multiples were 5.5x and 11.2x, respectively.

Download: Oil and Gas Sector Update - Americas – 1st Quarter 2019.pdf (2.1) MB

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