Wood Group: Conditions in Energy Markets Remain Favourable (UK)

A leading international energy services company, Wood Group comprised of three businesses—Engineering, Wood Group PSN and Wood Group GTS, has issued the Interim Management Statement.

According to Wood Group conditions in energy markets remain favourable. The Group continues to deliver good growth and is confident of achieving full year performance in line with expectations.

The Engineering division is performing well, driven by high activity in upstream and subsea & pipelines, and the order book and future prospects remain strong. In Upstream, the company is working on a number of major offshore developments in the Gulf of Mexico and are active in international markets on projects including Ichthys in Australia and Mafumeira Sul in Angola.

In subsea and pipelines, the Group is particularly active in the North Sea and the North West shelf of Australia. In downstream, activity levels have been impacted by more subdued US refining expenditure although, as anticipated, the Group expect some improvement in the second half.

In Wood Group PSN, strong performance in the North Sea and North America is continuing. In North America Wood Group further strengthens the presence in the shale regions through the recently announced agreement to acquire Mitchell’s, a provider of maintenance, installation and fabrication services in the oil-rich Bakken region of North Dakota. In Oman, they are anticipating a full year loss of around $15m – $20m. Elsewhere, the Group remains active in Africa, the Caspian and Australia, where they have recently been awarded a significant maintenance contract with Melbourne Water.

In Wood Group GTS, the company expects good growth in EBITA for the year in Maintenance and Power Solutions. Power Solutions has recently been awarded contracts with NRG Energy and Pasadena Water & Power in the US which  will contribute in 2013. The company continues to see the potential for further awards.

Wood Group anticipates strong operating cash flow in the second half, and the strong balance sheet provides a robust platform for growth.

The Group continues to be confident of achieving full year performance in line with expectations.

Press Release, October 05, 2012

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