Shares in Wood Plc (LON: WG) climbed this morning as the Aberdeen-headquartered energy firm increased its full-year guidance.
The company said full-year revenues are expected to be around $6bn, double that of its reported half year results today of $2.98bn.
Adjusted EBITDA is to be ahead of previous expectations, within its medium-term target of “might to medium” single-digit growth.
Shares were up 4% as of 9.30am.
Wood CEO Ken Gilmartin said the firm is making progress on its strategy, set out in November, targeting specific priority markets across energy and materials that match their competitive strengths.
© Supplied by WoodHe said: “When we announced our growth strategy in November last year, we set out a plan for Wood to deliver on its significant potential, and I am delighted that our results show the clear progress we are making.
“We have made a good start to the year, delivering growth in revenue, EBITDA, headcount and our pipeline, all while furthering our inspiring culture, as evidenced by our highest-ever employee net promoter score.
“As we look ahead, we are confident that our actions, the business model we have implemented and the market growth opportunities to which we have aligned, support the momentum we are building in our business. As such, we are increasing our full year guidance for the year for revenue and EBITDA.”
Adjusted EBITDA was $202m, up 9% on last year and order book has grown 5% from December to $6bn (but down 6.7% on H1 2022).
Notable progress was made for Wood Plc on sustainable solutions which took in $600m of revenues, up 20% on last year, and representing 20% of group take.
“Excellent growth” was reported across Carbon Capture and hydrogen.
Loss for H1
Wood fell to a $27m half-year loss amid hangovers from Apollo’s takeover attempt and a legacy contract.
The loss, which compares to an $89m profit in the same period in 2022, reflects a $20m impairment on a large power and industrial EPC contract, a business area it closed in 2022.
Other exceptional items took a toll; Wood said around $5m was recorded as costs linked to the attempt by private equity firm Apollo earlier this year to take over the Aberdeen-headquartered business.
Wood Plc also said the results reflect lower profits from its Built Environment Consulting business, which it sold in 2022.
Operating profits were therefore down 25.7% on the first six months of 2022, to $23m.
Apollo – arguably a costly and distracting exercise
John Moore, senior investment manager at RBC Brewin Dolphin, said: “Despite the reorganisation and restructuring, Wood’s revenue on continuing operations is up on where it was this time last year and today’s results offer some potential for recovery and if executed, better times for shareholders.
“The well-publicised bid by Apollo was arguably a costly and ultimately distracting exercise with the outcome heightening pressure on the board to lay out a vision for the years ahead.
“Key tasks for the incoming CFO will be reducing debt further, improving cash generation and profit margins and the continued streamlining of the business. Positively Wood’s end markets remain robust, but growth will be hard to come by and as a result, self-help remains the main driver for shareholder returns.”
Departing Wood Plc CFO
© Supplied by David Kemp/ LinkedinMeanwhile, Wood today announced that its chief financial officer David Kemp intends to retire.
A process in now underway to replace him.
Mr Kemp joined the Wood board in January 2015, and was appointed CFO in May that year.
Most recently, he played an important role in the group’s response to Covid, the sale of its Built Environment Consulting business, and in setting up the Group’s new growth strategy.
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