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(Alliance News) - John Wood Group PLC on Tuesday reported a slightly narrowed pretax loss in the first half of 2023, amid higher revenue and gross profit, while also saying it looking for a new finance chief.
Shares were up 3.1% to 152.75 pence in London early Tuesday.
The Aberdeen, Scotland-based engineering and consulting business reported a pretax loss from continuing operations of USD26.0 million for the six months that ended June 30, narrowed from USD30.5 million a year before.
Revenue rose by 17% to USD2.99 billion from USD2.56 billion, lifting gross profit by 22% to USD345.5 million from USD283.6 million.
Higher administrative expenses and impairments taken this year but not last left operating profit down 26% at USD22.8 million from USD30.7 million. However, higher finance income and lower finance expense resulted in the slightly narrowed pretax loss.
Of the exceptional items, USD5 million in cost related to the aborted private equity bid for John Wood. Back in May, a bidder owned by the US's Apollo Global Management Inc decided against making a firm takeover offer for John Wood, having previously made five tentative proposals.
Looking at headline results in the recent half, adjusted earnings before interest, tax, depreciation and amortisation rose by 8.5% to USD202 million from USD186 million. Adjusted Ebitda was up 12% at constant currency. The adjusted Ebitda margin narrowed slightly to 6.8% from 7.2%.
"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," said Chief Executive Officer Ken Gilmartin. "We have made a good start to the year, delivering growth in revenue, Ebitda, headcount and our pipeline,
John Wood provided guidance for 2023 revenue and adjusted Ebitda. Revenue is expected to be around USD6 billion. Adjusted Ebitda is expected to be ahead of previous expectations and within the company's medium-term target of mid to high single-digit growth. Adjusted Ebitda margin is expected be flat at about 7%.
For 2022, John Wood recorded adjusted Ebitda of USD385 million on revenue of USD5.44 billion. The adjusted Ebitda margin for all of last year was 7.1%, down from 7.7% in 2021.
The company has an order book worth USD6 billion, up 5% from December.
On Tuesday, John Wood also said that David Kemp plans to retire as chief financial officer but will stay in place until a replacement is found. Kemp joined John Wood in 2013 as CFO of the former Wood Group PSN business and became group CFO in 2015. The company said the recruitment process is underway.
John Wood declared no dividend, unchanged on a year before, citing free cash outflow in the first half. This was USD219 million, slowed from USD352 million a year before.
By Tom Waite, Alliance News editor
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