Wood Group CEO Ken Gilmartin said he was disappointed with the company’s financial performance.
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John Wood Group saw a 55% stake plunged in London on Friday, and issued a trading update that revealed that the company’s cash flow would be negative this year, which was positive before He said that.
The oil and gas engineering giant also said that a review of the business conducted by Deloitte consultants discovered key weaknesses and failures in its governance.
“This is a difficult announcement in our transformation,” said Ken Gilmartin, CEO of Wood Group. Growth markets, mainly energy. ”
The Aberdeen-based company, operating in 60 countries and employing around 35,000 people, has been struggling in recent years. The company was pressured to activist investors to consider selling, and ultimately two acquisition deals were abandoned.
After Wood Group rejected several large projects, the company announced that Deloitte would run a review of the project division.
The company’s trading update said it is taking steps to strengthen “financial culture, governance and control” due to “weaknesses and failures” identified by the review. Wood Group also said Friday it does not expect the review to have a significant impact on cash position or ability to generate cash.
The company said it could potentially negative free cash flow by $200 million in 2025, but is now expected to return to positive free cash flow next year.
Wood Group accused fourth quarter transactions of one of the contributing factors, but this year the company said it would support its balance sheet and generate cash from asset sales that helps maintain debt levels. I’m aiming for it. They also pursue cost-saving programs that include canceling employee bonuses.
“Following these actions, business is on a more rigid operational foothold, but cash generation has not yet been realized and there is a need for significant improvement in financial strength,” Wood Group submitted It states.
Wood Group said its underlying revenues for 2024 are low, with EBITDA forecasting between $450 and $460 million. Biron reported revenues of around $5.7 for 2024.
Last year, Wood Group was mostly acquired in a deal valued at nearly £1.6 billion by Sidara, but the Dubai-based company has abandoned its bid and denounced its disruption and geopolitical risks in the global market.
Apollo Global has decided to end its months-long pursuit to acquire Wood Group in May 2023. The US private equity firm had signed a bid agreement of about £2.2 billion to take over the Scottish company.
Wood Group has managed a large debt pile since it acquired rival Amec Foster Wheeler in 2017 for £2.2 billion.
