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Staff briefing assists in putting some meat on the bones of the RNS

Have a great day

GK

Gilmartin, Ken

Chief Executive Officer

Team,

Today we provided an update to the market on draft findings from the Independent Review and outlined what that means in terms of the timeline for completing our full year 2024 results.

This is a difficult update, and I want to try to explain this to you as simply as I can, recognising we will provide a fuller update once the Review is finalised.

Update on the Independent Review

Initial findings from the Review are sobering and have identified specific areas of weakness that require us to make significant improvements. The initial findings centre on:

1. Issues in a limited number of contracts in Projects, namely on legacy lump sum turnkey (LSTK) scopes whereby a number of prior year accounting adjustments are expected to be required

2. Issues in how accounting standards were applied. This includes unsupported dispensations and instances where amounts were held on the Projects centre balance sheet that should have been written off

3. Gaps in financial controls. This relates specifically to the reporting of project positions in the Projects business unit

4. Material weaknesses and failures in the Group’s financial culture within the Projects business unit and engagement between Group Finance and Projects. This includes instances of inappropriate top-down management pressure, in particular to maintain previously reported financial positions, and reliable information not being shared with our auditors.

5. It’s important to note that no material issues have been identified in our other business units – Consulting, Operations and Investment Services.

The cultural findings are some of the most difficult to hear because, put simply,, this was found to be a top-down leadership issue whereby people were put in compromising positions and under pressure to maintain previously reported positions. This is unacceptable.

My commitment to you all, and to our teams in Projects and in Finance in particular, is to ensure the difficulty of this moment presents a reset.

Indeed, that is already underway. There has been significant change within Wood and steps taken so far include:

1. Changes in key roles within finance, including the appointment of Iain Torrens as interim Chief Financial Officer, the recent appointment of Grant Angus as interim Group Financial Controller and the appointment of Ranjit Paul as the new interim President of Financial Planning & Analysis. Under Iain’s leadership, we will continue to take significant and immediate steps to improve and advance.

2. Expert, external assistance to redefine the dispensation process to more closely align Wood’s policies to accounting standards.

We are resolute in our focus to take all necessary actions in response to the findings of the Review. A detailed remediation plan will be shared and implemented as a priority, led by the executive leadership team.

Accounting implications

There are some accounting implications stemming from the Review’s initial findings and we expect to make prior year adjustments as a result.

1. Any adjustments predominantly impact the reported performance of the Projects business unit in prior periods with no material impact on our historical cash flow generation

2. Material prior year P&L and balance sheet adjustments are expected for FY22, FY23 and HY24

3. Material restatements are expected for adjusted EBITDA and adjusted EBIT for FY22 and FY23

These are historical adjustments, and we do not currently expect any material impact from the Review on our ability to generate cash in the future.

Publication of full year 2024 (FY24) results

I am disappointed to tell you that given the complexity of the Review and the extensive work needed, it is now expected that we will not publish our full year 2024 audited accounts before the deadline of 30 April 2025.

This means that our shares would be suspended from trading from 1 May 2025 while we work to complete our 2024 accounts. In effect, the share price is locked from the last day of trading and once we file our full year audited accounts, trading resumes from the last price. We will maintain our obligations to update the market as normal during this period.

It’s important you know that this does not affect our ability to keep doing business, it will effectively remain business as usual as we continue to deliver for our clients.

We remain in constructive dialogue with Wood’s lenders regarding refinancing options and will engage with lenders in respect of the timing of our 2024 accounts.

We’re doing everything to assure our future position.

Next Steps

We expect to finalise the Review very soon. At that point, we plan to discuss this in more detail with you and talk through how we will strengthen and improve.

We are working with our auditors to complete our full year 2024 results. Although that is expected to exceed the 30 April 2025 deadline, work continues to ensure we can file as quickly as possible.

As I explained last week, we remain in discussions with Sidara around their possible offer to acquire the company. They have until 5.00pm on 17 April 2025 to announce their intention to make a firm offer for Wood or not.

I appreciate this update will feel concerning to you, be assured we’re working diligently to prioritise what matters most, take difficult but necessary actions and ensure a better business.

The greatest strength we have is you – your contribution, capabilities and commitment to delivering for our clients, keeping yourselves and others safe and always doing the right thing. These are my greatest asks of you.

With all my thanks,

Ken