Oil services company Subsea 7 reported first-quarter margins that were better than most investors had expected and upgraded its full-year profitability forecast.

The firm has been hit over the past three years by lower demand from oil companies due to falling energy prices, but a recent recovery has helped recover some ground.

Subsea 7, which provides engineering and construction services to the offshore oil industry, reported an earnings margin before depreciation and amortization of 30% for the first quarter.

Brokers Pareto Securities said analysts had on average predicted a margin for the quarter of only 20%.

Looking ahead, Subsea 7 said its adjusted earnings margin this year was expected to be lower than the record level reported in 2016. In March, however, it said the percentage margin would be “significantly lower.”

“Our early engineering activity has increased, and we expect this trend to continue as the market recovers in the future,” the company said in a statement.

In the first quarter, Subsea 7 posted adjusted operating profit before depreciation and amortization of $268 million, down from $284 million at the same time a year ago. Its backlog was unchanged quarter-on-quarter at $5.7 billion.

No Reuters poll figures were available in this quarter as Subsea 7 acquired in March the remaining 50% of Seaway Heavy Lifting, changing its earnings reporting structure.

—Reuters

Offshore