Wood Group’s solidity is the key to delivering on market forecasts

By GARETH MACKIE
Published on 29/06/2012 09:59

ENERGY services firm Wood Group today said it was confident of delivering annual results in line with market expectations after reporting a solid start to the year across its three main divisions.

In a trading update ahead of its first-half results, the Aberdeen-based group, headed by chief executive Allister Langlands, said its engineering division was performing well and expects to see a 30 per cent increase in earnings before tax and other items.

In the six months to June 2011, earnings at the engineering business rose 25 per cent to $72.5 million (£46.4m), on revenues 16 per cent higher at $688.5m.

Its PSN oil and gas services division, formed last year following the acquisition of Production Services Network, is expected to show “improved performance” over 2011, and it sees opportunities for further growth in the Americas.

While market conditions in the power sector remained “relatively challenging”, the group said GTS, its turbine maintenance business, should see good earnings growth, weighted towards the second half.

The company, which last week won a contract to provide oil giant Shell with engineering and management services for its US operations, is due to post its half-year results on 21 August.

First-half figures a year ago showed a 25 per cent rise in earnings before tax, interest and amortisation to $192m. Revenues of $2.8 billion were up 17 per cent on the previous year.

Wood said yesterday: “Our balance sheet remains strong and provides a robust platform for growth.”