Wood cuts more costs as profits forecast to fall

Energy services giant Wood Group today predicted a fall in first-half profits and said it was cutting more costs in response to “challenging” conditions in the oil and gas sector.

Although the Aberdeen-based group said that figures for the six months to 30 June will demonstrate its “resilience”, they will be down on the same period last year.

However, it insisted its full-year underlying earnings would be broadly in line with City forecasts of about $469 million (£299m).

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“To help offset the impact of lower activity and pricing pressure, we are delivering savings significantly in excess of original targets from our cost reduction initiatives,” Wood said.

The trading update came as the firm won a $250m ten-year deal to provide operating services for the North Sea’s Central Area Transmission System, which carries 13 per cent of the gas used for UK domestic consumption.

Wood’s first-half results will be released on 18 August.