TSC Offshore Group, an equipment and parts supplier to the oil and gas industry, expects 'tough market conditions' to persist for the rest of the year, as the recent oil price rebound has yet to result in more orders. The company, which has applied to regulators to move its listing from the Growth Enterprise Market to the main board, is cutting costs by shifting operations from Europe and the United States to the mainland and streamlining operations. 'This year is a relatively tough year for us, so we will adopt a more conservative stance on our sales effort,' said chairman Jiang Binghua, referring to the fact that customers have slowed their order placements. 'The oil price has recovered somewhat, but orders from oil companies are lagging.' The company had US$115 million worth of uncompleted orders at the end of last year and received an undisclosed amount in this year's first four months. TSC posted turnover of US$160.11 million last year, up from US$34.32 million in 2007. Net profit surged to US$10.33 million, but profit margins were dragged down by overseas operations it acquired last year, mostly involving Britain-based Global Marine Energy, which posted losses in the two years to March 2007. In this year's first quarter, TSC reported a net loss of US$2.8 million, compared with a year-earlier profit of US$292,000, even as sales climbed 37 per cent to US$26.52 million. Mr Jiang said, without giving figures, that the company had cut overhead expenses and would reap savings by moving production and low-end engineering work to the mainland. To capitalise on international equipment producers' desire to tap the mainland's lower costs, TSC has struck marketing alliances with major oil rig designer Friede & Goldman and several mainland shipyards that also produce rigs. After the acquisition of Global Marine, Mr Jiang said, TSC had been able to provide a wider range of products.