Pre-close trading update
December 14, 2015
Source: Carolyn Smith
Job Title: Wood Group Press Office
ohn Wood Group PLC ("Wood Group" or "the Group"), issues the following pre-close trading update for the year to 31 December 2015. Full year results will be announced on 23 February 2016.
Our overall outlook for 2015 remains unchanged and we anticipate full year performance in line with previous guidance for EBITA of around $465m. In what is expected to be a prolonged period of challenging market conditions we are benefitting from our flexible business model and are focussed on managing utilisation, delivering overhead cost savings in excess of estimates at the half year and working with customers to develop efficient solutions. Our balance sheet and cashflow generation remain strong, supporting the delivery of strategic acquisitions and our previously stated intention to increase the dividend by a double digit percentage in 2015.
In Wood Group Engineering, we entered 2015 with reasonable backlog and performance also benefitted from the breadth and diversity of our business. In Upstream, work continues on key projects including Det Norske's Ivar Aasen and Hess Stampede and these will both provide follow on work in 2016. Activity on the Saudi Aramco Offshore Maintain Potential contract is also progressing well. In our Subsea business, we are continuing work on larger projects including BP Shah Deniz and Gorgon. We also secured a number of FEED studies including two for Talisman in Vietnam in addition to work for Woodside on Browse. These smaller awards position us well for future detailed engineering scopes. Key customer relationships remain strong; in October we were awarded a five year contract to provide engineering services across BP's existing subsea infrastructure in the Gulf of Mexico, UK, Norway and Azerbaijan. We have seen good activity in our downstream, process and industrial businesses where work on the Flint Hills refinery modification project is continuing. In September we also added to our UK automation capabilities with the strategic acquisition of Automated Technology Group. Looking ahead, current backlog is slightly below our typical range of 6 to 9 months visibility, and has been impacted in particular by the slow pace of significant new awards in the Upstream and Subsea markets.
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