Energy services company Wood Group has, during the first half of the financial year (1H 2015), slashed its workforce by 13 per cent as it feels the pressure of the challenging conditions in oil & gas markets, recording a drop in profit driven by an almost 20% revenue decline.
Profit for the six month period to June 30, 2015 was $121.2 million, compared to $149.9 million same period last year.
Adjusted diluted EPS is down approximately 10 per cent at 40.1 cents. However, Wood Group declared an interim dividend of 9.8 cents per share, an increase of 10.1 per cent, which will be paid on September 24, 2015.
Total revenue was at $3.1 billion versus $3.8 billion in the corresponding period in 2014. PSN Production Services revenue was down 21.7 per cent reflecting lower activity particularly in the Americas. Engineering revenue was down 10.9 per cent, however EBITA margin was slightly up reflecting good activity and improved margins in onshore pipeline and downstream offsetting the impact of pricing pressure and the deferral and cancellation of projects in upstream and subsea.
Bob Keiller, CEO of Wood Group, said: “Conditions in oil & gas markets remain very challenging. Performance in the first half demonstrates our commitment to cost discipline and the resilience and flexibility of Wood Group’s through cycle model. Our outlook for 2015 overall remains unchanged and we anticipate that full year performance will be in line with analyst consensus. With little prospect of short term improvement in market conditions, we will focus on remaining competitive and protecting our capability, working with clients to reduce their overall costs, increase efficiency and safely improve performance.”