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Wood Group reveals first half slightly ahead of guidance

"Performance in the first half is at the upper end of our guidance range, reflecting continued momentum in trading and delivery of cost and revenue synergies,” said Robin Watson, Wood chief executive.
oil and gas operations
The interim dividend increased to 11.3 cents per share

John Wood Group PLC (LON:WG.) revealed positive first half results with revenues up 13.4% at US$5.38bn.

It boasted strong organic growth for the six months to June 30, and, the company said it is confident of a stronger second half due to its visibility and the continued oil market recovery.

Earnings (EBITDA) totalled US$260mln, down 1.5% from US$264mln, but, ahead of guidance which was pitched at US$250mln to US$260mln with margin reported at 4.8% representing a 0.8% reduction in the comparative period of 2017.

READ: John Wood Group secures services contract with Shell in the Philippines

The oil services group increased its interim dividend to 11.3 cents per share, from 11.1 cents.

It ended the six month period with a US$10.6bn order book and US$1.6bn of net debt.

"Performance in the first half is at the upper end of our guidance range, reflecting continued momentum in trading and delivery of cost and revenue synergies,” said Robin Watson, Wood chief executive.

“Integration is ahead of schedule and we are increasing our three-year cost synergy target from at least $170m to at least $210m.

“Wood is delivering strong operational cash flows which underpin our deleveraging plan.”

Visibility for a stronger second half

Watson: “We have good revenue visibility and remain confident of delivering a stronger second half.

“Our full year outlook is unchanged; we are seeing recovery in our core oil & gas market and good contract awards in broader industrial sectors.

“We remain on track to deliver growth in 2018 in line with previous guidance and market expectations."   

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