Aberdeen-based oil and gas services giant Wood Group said on Wednesday that it expects its earnings before interest, taxes and amortization (EBITA) to December 31, 2016 to be 20% lower than 2015 amid “challenging” market conditions.

Wood said the anticipated drop in EBITA is in line with analysts’ expectations — which are about $377 million.

The company reported EBITA of $470 million last year, according to Reuters data.

In a trading update for its annual general meeting, the company said in a statement: “Market conditions remain challenging in 2016 and we have seen further margin pressure in an environment of expected lower activity by operators.

“Year to date financial performance, although down on 2015, continues to benefit from the breadth of our offering, our focus on management of utilisation in response to demand, and structural overhead cost savings.

“We anticipate that full year EBITA to 31 December 2016 will be around 20% lower than 2015, in line with current analyst consensus expectations.“

Wood Group said it recently extended its $950 million bank facilities until 2021 “at the same competitive rates.”

It said its balance sheet strength, cashflow generation and longer term confidence supported its intention to increase its dividend per share by a double digit percentage in 2016.

Wood Group added: “Our continued focus on reducing costs, improving efficiency and broadening our service offering through organic initiatives and strategic acquisitions, positions us as a strong and balanced business in both the current environment and for  when market conditions recover.

“A trading update for the first half of the year will be provided on 30 June 2016.”

Read the full Wood Group AGM statement here: http://www.woodgroup.com/investors/financial-regulatory-news/Pages/2167298.aspx