John Wood Group PLC (LON:WG.) reported a halving of first-half operating profits and hung fire on its dividend but cut costs and net debt.
Revenue of US$4.1bn for the first six months of the 2020 was down 15% year on year, as had previously been flagged by the energy services company, while it said like-for-like revenues were down 11.5%.
This bubbled through to a 53% plunge in operating profits to US$66mln, or a 40% fall to US$101mln excluding exceptional items.
Underlying earnings (EBITDA) were at the upper end of its prior guidance, the FTSE 250 company said, also highlighting its 31% reduction in net debt to US$1.1bn.
No interim dividend was paid, with Wood Group saying a payout is not likely while “uncertainty arising from COVID-19 and oil price volatility persists”.
After the actions to deliver US$200m overhead savings were completed, with US$70mln impact in the first half, chief executive Robin Watson said: “We are benefitting from our broader market exposure and have seen relative resilience in two-thirds of our revenue which is derived from chemicals & downstream, renewables and built environment markets.”
He said the board’s objectives are to maintain full-year margins in line with 2019 and deliver strong cash flow to further reduce debt in the second half.