Engineering firm Wood Group has since its revenues slide 20% to US$3 billion as it suffers from the reduction in activity in the oil and gas sector caused by operators tightening their belts amid low oil prices.
The firm, which has reduced its headcount 13% since December, and made overheads savings of $40 million in the first half, also saw profits drop 14.3% to US$156 million.
Wood Group CEO Bob Keiller said: “Conditions in oil and gas markets remain very challenging. With little prospect of short term improvement in market conditions, we will focus on remaining competitive and protecting our capability, working with clients to reduce their overall costs, increase efficiency and safely improve performance.”
Despite the gloom, the firm is still winning contracts. Today it announced a letter of award for a new five-year, multi-million dollar contract with Shell, to provide services to four onshore oil fields in Gabon.
It has also secured new long-term awards in the North Sea for Antin and in Saudi Arabia and Mexico. But, the firm said it would continue to “focus on actions to offset the impact of lower activity and pricing pressure.” It is working with customers to reduce project costs, increase operating efficiency and safely improve performance, the firm said.
Keiller said: “Performance in the first half demonstrates our commitment to cost discipline and the resilience and flexibility of Wood Group’s through cycle model. Our outlook for 2015 overall remains unchanged and we anticipate that full year performance will be in line with analyst consensus.”
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