Wood Group (John) PLC reported a drop in revenue and profit for 2021, hit by a “significant decline” in its Projects division, and also announced that chief executive Robin Watson has decided to step down.
The provider of services to the oil and gas and power generation industries said business momentum is now improving and reported good progress on its plans to sell its Built Environment operation.
Revenue for the year to end December 2021 came in at US$6.4bn, down 15.4% on 2020, while underlying profit, (adjusted EBITDA) dropped 10% on a like-for-like basis to US$554mln.
Like-for-like revenue in the Consulting (up 1.6%) and Operations (up 3.9%) businesses was more than offset by a 34% slump in Projects. In addition, Wood Group recorded an exceptional write down of US$99mln on its Aegis Poland contract.
The publication of the FTSE 250 group’s results had been delayed to carry out an external review of the Aegis Poland charge.
"2021 was a challenging year for the group, with the ongoing pressures of the pandemic, mixed market conditions across our businesses and continued challenges in Projects impacting our performance,” commented Watson.
But he noted that the company ended 2021 “with positive momentum and a growing order book, which gives us confidence that activity levels will be higher in 2022”.
The order book stood at US$7.75bn at the year-end, 19% higher than 12 months earlier.
Watson said Wood Group expects to announce the sale of the Built Environment business in the second quarter of 2022.
“A sale will deliver significant value for our shareholders and help move the group onto its next chapter,” he said.
Excluding the impact of any sale, Wood Group expects higher revenue in 2022 across the business, supported by the growth in the order book, with revenue in the order book for 2022 of US$4.65bn, up 6% on the equivalent figure last year.
Watson said he will remain in his role as CEO until a successor has been appointed.
“I look forward to continuing to serve on the board until my successor is in place and I remain fully committed to our business delivery and enabling a smooth transition."
The company had net debt of US$1.4bn at 31 December 2021, 37.4% larger than the year before, reflecting the negative free cash flow in the year.
Given the current level of debt, the board has decided not to declare dividends in relation to the 2021 financial year, it said.