John Wood PLC (LON:WG) today announced in its trading update for the six months to June 2016 that it expects earnings to remain 20% lower in 2016 compared to 2015.
The company said:
“We expect financial performance in the first half of 2016 to demonstrate the benefits of: our asset light, predominantly reimbursable business model; our attention to management of utilisation; and significant overhead cost savings from reorganisation, delayering and back office rationalisation.
Overall the outlook for the full year has not changed and there is no change to earnings before interest, tax and amortisation guidance of around 20% down on 2015 as given in May,”
Wood said that the current environment remains challenging for both volume and pricing but remains firm on its leading positions in brownfield operations having renewed contracts with Chevron, Enquest, Nexen, Shell, Talisman, Taqaand co.
Furthermore the company said it continues to see areas of future growth in its engineering sector despite saying its ability to forecast future projects remained difficult due to the lack of large-capax projects coming into the market.
Wood stated that plans to increase its dividend per share by a double-digit percentage for 2016 remain in place.
Following its trading announcement, Shares in Wood Group dropped 19p (2.8%) to 651.5p at EMT
30/06/2016