Wood H1 revenue falls 21% to $3.2bn; H2 stronger

Shares of Aberdeen-based global engineering group Wood plc fell about 4% on Thursday after it published a trading update for the six months ended June 30, 2021, saying revenue on a like-for-like basis will be down 21% to $3.2 billion and adjusted EBITDA down 12% to between $255 million and $265 million.

However, Wood said it is confident of delivering a “stronger” second half and said its full year outlook is unchanged.

Wood’s order book at the end of May was $6.9 billion, up 6% on December 2020.

Wood employs about 40,000 people in around 60 countries.

Wood plc CEO Robin Watson said: “Following a steady start in Q1, we have seen improving momentum in activity in Q2 with growth in Consulting and Operations compared to Q2 2020.

“We expect to deliver strong margin improvement compared to H1 2020, with a greater weighting of high margin Consulting activity and margin improvement across all business units.

“Our full year outlook is unchanged with trading momentum and growth in our order book, which is up c6% year-to-date driven by Consulting and Operations, giving us confidence that the group will return to growth in the second half, compared to both H1 2021 and H2 2020.

“In line with our strategic objective we anticipate growth in EBITDA margin.” 

Wood gave an update on the investigations ongoing at the group.

We continue to anticipate that settlement of the investigations by the UK Serious Fraud Office (SFO) and by the authorities in the US and Brazil will be finalised, subject to court approvals, during Q2 2021,” said Wood.

“It is expected that approximately $60m of the settlement amounts will be payable in H2 2021, following payments in H1 related to the settlement of the investigation by the Scottish authorities in March of c$10m.  

“The remaining $126m payable is expected to be payable in instalments in 2022, 2023 and 2024.”