TIDMWG.
RNS Number : 4625Z
Wood Group (John) PLC
12 January 2024
FY23 trading update
12 January 2024
Full year trading in line with expectations
John Wood Group PLC ('Wood' or 'the Group') announces a trading
update for the year ended
31 December 2023 ('FY23').
Ken Gilmartin, CEO, said:
"We are now one year into our strategic growth journey and our
results continue to show clear progress. We have delivered strong
revenue and EBITDA growth, improved our underlying cash generation,
grown our order book, and continue to see an acceleration in the
proportion of sustainable solutions within our pipeline.
"We are confident that our actions, business model and strategy
are delivering and look forward to giving a further update in
March."
Highlights
-- Trading in line with expectations
o FY23 revenue around $6 billion, up 9% with good growth across
all business units
o FY23 adjusted EBITDA slightly ahead of guidance at $420
million to $425 million, up 9%
o Adjusted EBITDA margin slightly above 7% including opex
investments in the year
-- Further momentum in strategic delivery
o Significant contract wins across energy and materials
o Order book of around $6.1 billion was up 4% on a comparable
basis(1) and supports our growth expectations for 2024
o Over 40% of bidding pipeline now from sustainable
solutions(2)
o Started the sales process for our stake in the EthosEnergy
joint venture(3)
-- Continued improvement in underlying cash flows
o Operating cash flow of c.$210 million, a significant
improvement on FY22 ($66 million outflow), with around $175 million
operating cash flow generated in the second half
o Net debt excluding leases at 31 December 2023 was c.$680
million, including exceptional cash outflows in line with our
guidance of c.$140 million and an FX impact of c.$15 million
o Net debt was slightly above our expectations due to FX and the
timing of customer receipts in December, as flagged in our Q3
trading update
o On track to deliver positive free cash flow in 2024, as
previously guided
FY23 trading across businesses
Consulting saw strong revenue growth of c.13% to c.$0.7 billion
with continued growth in our solutions across energy security,
energy transition and digital consulting.
Adjusted EBITDA was c.4% higher at c.$80 million, with revenue
growth partly offset by a lower margin of c.11% compared to 11.7%
last year, reflecting opex investments to support future
growth.
Projects saw strong revenue growth of c.10% to c.$2.5 billion,
with very strong growth across oil, gas and chemicals.
Adjusted EBITDA was c.8% higher at c.$185 million with a margin
around 7.5% (FY22: 7.6%), partly reflecting the impact of
pass-through revenue.
Operations saw like-for-like revenue growth(4) of around 7% to
c.$2.5 billion. This growth reflects higher activity levels across
the business, particularly in Europe and the Middle East.
Adjusted EBITDA was around 11% higher at c.$165 million, with an
improved margin of around 6.5% (FY22: 6.1%) helped by good
operational performance.
Investment Services revenue was up around 35% to c.$0.3 billion,
reflecting higher activity in our heavy civils business, and the
facilities business transferred from Projects at the start of the
year.
Adjusted EBITDA was c.$70 million (FY22: $69 million), including
a contribution of around $65 million from the two Turbines joint
ventures (FY22: $48 million).
Central costs were around $75 million (FY22: $74 million) with
cost savings mitigating inflationary pressures.
Significant contract wins
Significant contract wins in the fourth quarter included:
-- Detailed engineering design for Woodside's Trion project, the
deepest semi-submersible facility in the Gulf of Mexico
-- Brownfield engineering contract in Europe, helping to produce
active pharmaceutical ingredients for medicines
-- Supporting one of the world's largest offshore clean power projects in Germany
-- Appointed owners' engineer for world-leading green hydrogen project in Spain
-- Delivering engineering, procurement, construction and
commissioning services on a cost reimbursable basis for brownfield
modifications for bp's Murlach development in the North Sea
-- Two-year operations contract extension with Equinor in the Mariner field in the North Sea
FURTHER DETAILS
Conference call
A webcast and conference call will be held today at 8:00am (UK
time) with Ken Gilmartin (CEO) and David Kemp (CFO). The webcast
will be live at https://edge.media-server.com/mmc/p/xv29crc6 .
To join the conference call, and ask any questions, please
register via:
https://register.vevent.com/register/BIe00865c7243640928f313b3a839cdb9e
.
The webcast and transcript will be available after the event at
www.woodplc.com/investors .
Full year results
We will publish our full year results in full on 26 March
2024.
For further information:
Simon McGough, President, Investor
Relations +44 (0)7850 978 741
Vikas Gujadhur, Senior Manager,
Investor Relations +44 (0)7855 987 399
Alex Le May / Ariadna Peretz,
FTI Consulting +44 (0)20 3727 1340
Notes
1. Excluding the Gulf of Mexico labour operations business that
was sold in March 2023. It had an order book of $117 million at
December 2022.
2. Estimated share of pipeline related to sustainable solutions:
renewable energy, hydrogen, carbon capture & storage,
electrification and electricity transmission & distribution,
LNG, waste to energy, sustainable fuels & feedstocks and
recycling, processing of energy transition minerals, life sciences,
and decarbonisation in oil & gas, refining & chemicals,
minerals processing and other industrial processes. In the case of
mixed scopes that include a sustainable solutions element, we
include the proportion of the contract that is related to those
sustainable elements.
3. Wood owns a 51% share in EthosEnergy, a turbines services
business that serves gas turbines, steam turbines, generators,
compressors and transformers. In FY23, our share of adjusted EBITDA
was around $30 million.
4. Excluding the Gulf of Mexico labour operations business that
was sold in March 2023. It contributed $21 million of revenue and
$1 million of adjusted EBITDA in FY23 up to its disposal. It
contributed $99 million of revenue and $5 million of adjusted
EBITDA in FY22.
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END
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