Wood Group reports EBITA of $470m in 2015; 14.5% lower than 2014

Performance demonstrates resilience and flexibility in challenging markets

ABERDEEN, 26-Feb-2016 — /EuropaWire/ — “Against a backdrop of significantly reduced customer activity, the Group delivered EBITA of $470m in line with expectations and 14.5% lower than 2014. Our continued actions to reduce costs, improve efficiency and broaden our service offering through organic initiatives and strategic acquisitions, position us as a strong and balanced business in both the current environment and for when market conditions recover.” – Robin Watson, Chief Executive

Financial Summary

2015
$m

2014
$m

%
Change

Total Revenue1

5,852.4

7,616.4

(23.2)%

Total EBITA1

469.7

549.6

(14.5)%

EBITA Margin

8.0%

7.2%

0.8pts

Revenue from continuing operations
on an equity accounting basis

5,000.6

6,574.1

(23.9)%

Profit from continuing operations
before tax and exceptional items
(after tax on JV profits) on an
equity accounting basis

320.2

414.5

(22.8)%

Profit from continuing operations
before tax after exceptional items
(after tax on JV profits) on an
equity accounting basis

138.6

475.1

(70.8)%

Adjusted diluted EPS

84.0c

99.6c

(15.7)%

Total Dividend

30.3c

27.5c

10.2%

Headlines

  • Relatively resilient performance. EBITA of $470m in line with expectations; 14.5% lower than 2014
  • Management focus on operational utilisation
  • Delivered overhead cost savings of $148m which will sustain into 2016
  • Underlying headcount reduced by over 8,000 people (c. 20%)
  • Continued progress on strategic acquisitions including expansion into the US brownfield petrochemical market. Total cash expenditure on new acquisitions of $234m
  • Engineering – Impact of Upstream and Subsea project deferrals and cancellation partly offset by growth in Downstream and robust performance in Onshore Pipelines
  • PSN Production Services – North Sea impacted by reduction in project and non-essential maintenance work and operator efficiency initiatives. US onshore impacted by significant pressure on volumes and pricing following strong 2014
  • PSN Turbine Activities – Previously indicated exceptional non-cash impairment of EthosEnergy of $159m
  • Strong balance sheet and cash generation. Net debt of $290m (0.5x 2015 EBITDA) and cash conversion of 119%
  • Dividend up 10%. Dividend cover of 2.8 times. Intention remains to increase the dividend for 2016 by a double digit percentage.

 

Notes:

1 Total Revenue and Total EBITA include the contribution from joint ventures and, in 2014, activities classified as discontinued. Total EBITA represents operating profit including JVs on a proportional basis before the deduction of amortization and net exceptional expense and is provided as it is a key unit of measurement used by the Group in the management of its business. See further detailed footnotes following the Financial Review.

 

Enquiries:

Wood Group

Andrew Rose – Group Head of Investor Relations
Laura McCracken – Investor Relations Manager
Carolyn Smith – Group Head of Communications +44 1224 851 000

Brunswick

Patrick Handley +44 20 7404 5959
Charles Pemberton

 

There will be an analyst and investor presentation at 60 Victoria Embankment, London, EC4Y 0JP at 09.00. Early registration is advised from 08.30.

A live webcast of the presentation will be available from www.woodgroup.com/investors. Replay facilities will be available later in the day.

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