John Wood Group PLC (LSE:WG.) announced first-half earnings in line with guidance and said a strong order book gives it confidence that it will return to growth in the latter half of this year.
Adjusted EBITDA came in at US$262mln in the six months to 30 June, down 14.1% on the previous year, while operating profit before exceptional items fell 14.9% to US$86mln, the consulting and engineering group said in a statement.
Revenue was hit by the Covid-19 pandemic and the sale of businesses and slumped by almost 23% to US$3.2bn.
The company said the first half had received a boost from improving trading momentum in the second quarter, with margins increasing in all business units. The adjusted EBITDA margin rose to 8.3% from 7.5% in the first half of 2020.
The order book totalled US$7.7bn at end-June, up 18% compared with end-December 2020 following a strong order intake in the first half.
Wood said its Consulting business saw continued momentum in the first half, with the Operations division boosted by recent contract awards and the Projects arm seeing encouraging signs of market recovery.
Chief executive Robin Watson was upbeat on the future, saying trading momentum and the improving order book gives the company confidence that it will deliver a stronger second half and a return to growth.
Wood Group expects full-year revenue of US$6.6bn-US$6.8bn, underpinned by strong orders. It forecast an EBITDA margin of 8.7%-8.9%, reflecting progress towards its medium-term target of 9.6%.
Net debt excluding leases climbed by 4.9% to US$1.28bn in the first half and was US$100mln higher than expected because receipts expected in the first six months were not received until the second half. Net debt is expected to fall in the second half, the group said.
There will be no interim dividend as a result of the ongoing impact of the pandemic.