Wood shares soar as H1 revenue hits $5.4bn

Shares of Aberdeen-based oil services and engineering giant Wood plc rose more than 8% on Tuesday after it said its revenue for the six months to June 30 rose more than 13% to $5.38 billion and operating profit before exceptional items rose to $125 million from $72 million at the same stage of 2017.

Wood, which employs 60,000 people and operates in more than 60 countries, said the integration work on its recent acquisition of rival Amec Foster Wheeler is ahead of schedule.

An overall loss for the period of $52 million was “impacted by non cash amortisation charges of $125m and exceptional costs of $101m including anticipated costs to deliver synergies and a non cash impairment charge relating to EthosEnergy.”

Wood said it is confident of a stronger second half “due to visibility on revenues, cost synergies and phasing of projects and market recovery.”

Wood shares rose 8% to about 715p to give the company a current stock market value of almost £4.8 billion, according to Bloomberg data.

The firm’s strong order book currently stands at about $10.6 billion and its full-year outlook is unchanged.

Wood said it remains “on track to deliver growth in 2018 in line with previous guidance and market expectations.”

Wood CEO Robin Watson said: “Performance in the first half is at the upper end of our guidance range, reflecting continued momentum in trading and delivery of cost and revenue synergies.

“Integration is ahead of schedule and we are increasing our three year cost synergy target from at least $170m to at least $210m.

“Wood is delivering strong operational cashflows which underpin our deleveraging plan.

“We have good revenue visibility and remain confident of delivering a stronger second half.

“Our full year outlook is unchanged; we are seeing recovery in our core oil & gas market and good contract awards in broader industrial sectors.

“We remain on track to deliver growth in 2018 in line with previous guidance and market expectations.”