Wood eyes North Sea uplift in second half

Wood, the Aberdeen-based energy services group, yesterday said activity in the North Sea is showing “moderate growth” and is expected to strengthen in the second half of the year.

In a trading update ahead of its half-year results, the company said it is continuing to see early signs of recovery in its core oil & gas market with the strongest growth being seen in Asia Pacific, where a contract with Exxon Mobil in Papua New Guinea continues to perform well and also in the Middle East where work with Iraq’s Basra Gas is increasing.

Woodsaidithadseengrowth in overall revenues in the first half of 2018 and was making good progress on cost savings and synergies related to the Amec merger. So far this year it has achieved $20 million (£15.3m) of cost synergies against an expected total of around $50m for the full year. The firm said it remains confident of delivering annualised cost savings of at least $170m by the end of the third year following completion of the deal.

The group expects to deliver first-half revenue of around $5.1-$5.2 billion and earnings of $250-$260m and the fullyear outlook is unchanged. Net debt at the end of June is expected to be approximately $1.7bn.

Chief executive Robin Watson said: “We are continuing to see early signs of recovery in our core oil & gas market and good contract awards in broader industrial sectors. We remain on track to deliver growth in 2018.”

The group said it expects to deliver a stronger second half due to factors including continued recovery in its markets. 0 ‘Stronger second half’ – Wood CEO Robin Watson