StockMarketWire.com - Engineering services company Wood Group said its adjusted earnings had slumped in the first half after the Covid-19 crisis hurt clients in the oil and gas sector.

Adjusted earnings before, interest, tax, depreciation and amortisation for the six months through June were seen falling 19%, with like-for-like revenue down around 11%.

Wood said relatively robust trading activity in the chemicals, oil refining and built environment sectors had helped buffer the blow from upstream oil and gas weakness.

Margins over the period had contracted by 70 basis points on a like-for-like basis.

Wood said it had, during the second quarter, completed actions to deliver overhead cost savings of over $200m for the full year.

The savings measures had come with exceptional costs of around $55m.

The company's order book at the end of May was $7.0bn, down about 11% since December 2019, of which about $3.5bn was due to be delivered in 2020.

During April and May, Wood booked new orders of $1.3bn.

'The global engineering and consultancy market is facing unique and unparalleled challenges in 2020 from Covid-19 and volatility in oil prices,' chief executive Robin Watson said.

'Despite the disruption, we are continuing to successfully win and execute work, supported by our strategy of broadening the business across the global energy market & the built environment.'

'The relative strength we are seeing in chemicals & downstream, the built environment and renewables, where we will double our revenues in 2020, is helping to mitigate the impact of challenging conditions in upstream and midstream oil & gas.'



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