UK's Wood Group hit by $8m loss in 2018 after UAE unit's impairment
Restructuring and impairment of Abu Dhabi's Ethos Energy dent Scottish engineering company's 2018 financial results
UK-headquartered construction and engineering business Wood Group has narrowed its 2018 loss by 74%, reporting a loss of $7.6m in 2018 compared to $30m in 2017.
The 2018 loss comes after Wood Group faced $30m in costs related to restructuring and “onerous leases”; an impairment of Abu Dhabi-based oil and gas equipment supplier Ethos Energy; and $10m-worth of write-offs related to the Abu Dhabi subsidiary.
Wood Group was also hit by a $10m arbitration settlement during the year, but the company did not provide details on the case in an update on its financial results.
Despite a number of unforeseen costs, Wood Group has seen its revenue for 2018 rise by 78% to $11bn, compared with $6.1bn in 2017.
The company was also able to shave off some of its debt, bringing it down to $1.5bn in line with its prior commitments to find ways to free up liquidity.
While Wood Group posted a loss, its revenue growth and debt reduction success suggest that the company, which works with Abu Dhabi National Oil Company and Saudi Aramco, is on track to reverse its fortunes.
Growth at the company – which employs close to 60,000 people in countries including Saudi Arabia, Kuwait, and Oman – was also praised by Wood Group’s chief executive, Robin Watson.
He said the company had noted “organic growth” after unlocking “opportunities across our broader range of capabilities and sectors to secure revenue synergies”.
While Watson did not predict a return to profitability in 2019, he did express his confidence in “achieving further growth” in the near future.