Interim results from John Wood Group PLC (LSE:WG.) showed a larger loss than last year but overall were slightly better than the energy services engineer had previously indicated after its recent takeover interest from Dubai's Sedara ended.
The shares fell initially on Tuesday before they turned higher, up 1% at 134p, though are down 35% from a month ago after the potential takeover was called off.
The results showed revenue of US$2.84 billion, down 4.8% from a year ago but a bit better than the $2.8 billion guidance, while adjusted EBITDA rose 8.5% to US$219 million and the order book was up 3.6% at US$6.2 billion.
An adjusted profit before tax of US$34.8 million was below forecasts, while at the statutory level a loss before tax of $983 million was reported, up from a $27 million loss a year ago.
A $815 million goodwill writedown was taken in the Projects business relating to legacy acquisitions, and there was a US$140 million exceptional charge related to the exit from lump sum turnkey (LSTK) and large-scale engineering, procurement and construction (EPC) work.
Despite this, cash flow and other guidance remained unchanged, with high single-digit growth in adjusted EBITDA expected for 2024 before disposals, with a second-half weighting, and net debt at December 2024 to be similar to December 2023 after disposals.
For 2025, the company expects adjusted EBITDA growth to exceed medium-term targets, with US$60m in simplification benefits and significant free cash flow.
A $30 million disposal of its CEC Controls business has been agreed, which is set to complete in the second half, while the Ethos Energy disposal is also "progressing well".
CEO Ken Gilmartin said: "These results demonstrate continued progress on our turnaround. Our strategy continues to deliver higher EBITDA and a larger order book, and we are improving the quality of our business with better pricing and higher margins.
"Our simplification programme is progressing at pace, with nearly half of the annualised $60 million savings from next year already secured."
He added that generating "sustainable, strong free cash flow continues to be an important focus for the delivery of our turnaround".