Interim Results
3 September 2002
John Wood Group PLC
Interim results for the period until 30 June 2002
Wood Group is a market leader in the provision of selected engineering design,
production support and industrial gas turbine services to customers in the oil
& gas and power generation industries around the world. Operating in more than
30 countries, Wood Group's businesses employ over 10,000 people.
Highlights
* Revenues up 14% to $812.7 million (2001: $713.0 million)
* Earnings before interest, tax and amortisation up 19% to $61.7 million
(2001: $52.0 million)
* Profit before tax up 32% to $50.9 million (2001: $38.5 million)
* Earnings per share pre amortisation up 28% to 7.8 cents (2001: 6.1 cents)
* IPO successfully completed in June 2002
* Gearing reduced from 87% at December 2001 to 27% at June 2002
* Investment and capital spend of $59.5 million (2001: $39.4 million)
* Interim dividend of 1.0 cent per share
Sir Ian Wood, Chairman and Chief Executive, commented:
'Overall, we remain confident about the prospects for the rest of the year, and
anticipate Group trading in line with expectations.'
'Looking further ahead, the Group has the management team, strategy and market
opportunities to continue to develop a major international energy services
business capable of delivering significant growth in shareholder value.'
Contacts:
John Wood Group PLC
Sir Ian Wood Chairman and Chief 020 7404 5959
Executive
Allister Langlands Deputy Chief Executive Thereafter
Alan Semple Finance Director 01224 851 000
Carolyn Smith Corporate Communications 01224 851 099
Brunswick Group Limited
Patrick Handley/Stuart 020 7404 5959
Bruseth/
Katya Reynier
Interim statement
In the first set of interim results following our recent IPO, we are pleased to
report strong progress. In the six months to June 2002, revenues increased 14%
to $812.7 million (2001: $713.0 million), earnings before interest, taxation
and amortisation ('EBITA') increased 19% to $61.7 million (2001: $52.0 million)
and earnings per share pre amortisation increased 28% to 7.8 cents (2001: 6.1
cents).
We are continuing to develop our activities in five key growth areas in oil &
gas and power, building on our position as a market leader in deepwater and
subsea engineering, in production support and enhancement, in artificial lift
and pressure control, in the industrial gas turbines aftermarket and in
outsourcing and managed services in both the oil & gas and power markets.
Oil & gas markets are generally robust, but there has been weakness in North
American gas drilling and in Venezuela. Our global presence and broad market
spread in gas turbine services has largely offset the deferral of maintenance
by North American Power providers. Our results for the six months confirm the
relative resilience of our activities compared with the oil service sector as a
whole, particularly in North America.
The prime reason for our IPO was to enable the Group to continue to fund its
successful growth strategy, allowing us to take advantage of organic
development and acquisition opportunities following our almost doubling in size
over the last two years. Our gearing is now down to 27% and this is after
acquisition investment of $35.1 million and capital expenditure of $24.4
million in the period. The Group is actively pursuing a number of investment
opportunities in our selected growth areas.
The directors have declared an interim dividend of 1.0 cent per share which
will be payable to shareholders on the register on 20 September 2002 and will
be paid on 18 October 2002.
Engineering and Production Facilities
The Engineering and Production Facilities business delivered an excellent
performance during the period. Revenues increased by 39% to $456.4 million
(2001: $329.5 million) and EBITA increased by 36% to $39.9 million (2001: $29.4
million) reflecting broadly similar margins of 8.7%. The revenue growth
reflected strong engineering revenues in North America and the North Sea and
the benefit of the acquisition in August 2001 of the Production Services Group
in the Gulf of Mexico.
In North America, Mustang and Alliance continued to benefit from strong order
books and won a number of important upstream contracts, including Conoco
Magnolia in the Gulf of Mexico and Marathon Alba in Equatorial Guinea. We are
carrying out significant engineering on seven of the fourteen current Gulf of
Mexico Deepwater projects including the four major developments for BP
Deepwater.
In the North Sea, Wood Group Engineering and Mustang are carrying out the
project management and detailed engineering for BP Clair, the largest current
new field development. In April, we announced the formation of Sigma 3 (North
Sea) Limited, a new joint venture between Wood Group, Amec and Kellog Brown and
Root to support Shell Expro in the UK sector of the North Sea with an
anticipated £750 million of work over the next seven years.
In June 2002, we added to our Gulf of Mexico operations and maintenance
capabilities through the acquisition of Operators and Consulting Services, Inc.
which had revenues in 2001 of $49 million, and which provides services to more
than 70 customers. Wood Group is now a major player in the Gulf of Mexico
operations and maintenance market, and we believe we are well placed to
participate in the developing deepwater market.
In Colombia, BP and Ecopetrol have awarded a new five year extended scope
contract to Equipo. Our operations in Venezuela have felt some impact of the
reduced activity of PDVSA. In Trinidad we have opened a new office to take
advantage of the significant oil & gas opportunities occurring in that region.
There is a continued focus on growth opportunities in Asia Pacific, and during
the period an operation in Indonesia was established to provide both
engineering and operations and maintenance services.
Well Support
As expected, Well Support faced more challenging market conditions in the first
six months of 2002 as a result of the significantly lower rig count in North
America and the political and economic uncertainties in Venezuela. Revenues
were down 7% to $180.4 million (2001: $194.6 million) and EBITA was down 28% to
$10.4 million (2001: $14.4 million), reflecting a reduction in margins from
7.4% to 5.8%.
Wood Group ESP was awarded a further significant pay-for-performance contract
in the Middle East for Joint Operations in Kuwait and also received its first
major ESP system order in China for Devon Energy. ESP also continued to enhance
its technology, and new product releases during the period included improved
variable speed drives and a new generation of downhole sensors.
Wood Group Pressure Control performed well, despite the challenging market
conditions in North America. In the Eastern Hemisphere, we have invested in
expanded manufacturing capabilities in the UK, and a new facility in Algeria
was opened. Several new products have been introduced, including a new SPAR
system and a second generation multi-bowl system, providing a smaller
footprint, lighter weight and safer operation.
Wood Group Logging Services activity levels were affected by the lower gas
drilling in the Gulf of Mexico, but our wireline operation, with its production
focus, continued to perform well and saw good growth in smart services and
deepwater wireline operations.
Gas Turbines Services
Our Gas Turbine Services business made good progress during the period.
Revenues increased by 4% to $158.4 million (2001: $151.7 million) and EBITA
from continuing operations increased by 14% to $21.1 million (2001: $18.5
million) as margins increased to 13.3% (2001: 12.2%). The lower revenue growth
reflected the uncertain market conditions in the North American power market
and lower volumes from aero customers within our gas turbine accessories and
components business.
The Light Industrial Turbine business performed well and its new Aberdeen test
facility for Alstom Tornado and Typhoon engines, opened in June, will provide
good growth opportunities over the next few years.
In our aero-derivative businesses, Rolls Wood Group is developing its new
Allison industrial engine overhaul business in Oakland, California, and
TransCanada Turbines has made good progress in developing its GE LM business.
The Heavy Industrial Turbine business in the Eastern Hemisphere met
expectations in the first six months but volumes in North America have been
adversely impacted by the deferral of maintenance by many of the major power
companies. We anticipate that the North American power market uncertainty will
continue into 2003, but we are confident that our global presence and the
increasing gas turbine installed base will provide good long-term growth.
Our strategy is to continue to extend the range of services we provide to our
power generation customers. In August 2002, we acquired Industrial Repair
Services Inc ('IRS'), a generator repair company, based in New Mexico. All gas
turbines used in power generation are linked to a generator and IRS will
provide significant synergies with our existing operations.
Our Accessories and Components business has been adversely impacted by the
reduction in aero engine related activity compared to the same period last
year. However, we continued to make progress in extending the range of
industrial gas turbine accessories which we service and the second six months
should see increased profits.
Outlook
Engineering and Production Facilities' strong first half performance should
continue and Well Support's weaker markets in North America and in Venezuela
are expected to improve towards the end of the year. In Gas Turbine Services,
our global presence and broad market spread should continue to largely offset
the weak North American power market. Overall, we remain confident about the
prospects for the rest of the year, and anticipate Group trading in line with
expectations.
Looking further ahead, we are building up differentiation and market leadership
in our five identified growth areas and we are increasingly benefiting from our
wide global presence. The Group has the management team, strategy and market
opportunities to continue to develop a major international energy services
business capable of delivering significant growth in shareholder value.
Financial Review
Revenues excluding discontinuing operations increased by $119.4 million or 18%
to $795.2 million for the six months to June 2002 (2001: $675.8 million)
reflecting in particular the strong performance of Engineering and Production
Facilities. Over the same period, EBITA excluding discontinuing operations
increased $8.9 million or 16% to $63.9 million (2001: $55.0 million) with
increases in Engineering & Production Facilities and Gas Turbine Services
offset by the reduction in Well Support.
The share of operating profit from ASCO, our associated company, was $2.8
million for the six months to June 2002 compared to $3.4 million for the
equivalent period in 2001, reflecting reduced activity in North America.
Cash inflows from operating activities amounted to $39.2 million in the six
months ended June 2002. Net debt decreased by $125.3 million from $256.4
million at December 2001 to $131.1 million at 30 June 2002 primarily as a
result of the IPO completed in June. Net proceeds of the IPO after expenses of
$11.5 million and redemption payments of $29.6 million amounted to $174.2
million. Capital expenditure in the first half of 2002 amounted to $24.4
million and payments relating to the acquisition of subsidiaries, joint
ventures and minority interest totalled $35.1 million. The Group's gearing
ratio has reduced from 87% at December 2001 to 27% at 30 June 2002.
Group borrowings are primarily U.S. dollar denominated. Of the total long-term
borrowings of $172.5 million at 30 June 2002, $100.0 million or 58% were at a
fixed rate of interest. The interest costs for the first six months were $7.9
million which was a reduction of almost $4.0 million from the same period in
2001, reflecting the fall in U.S. dollar interest rates in the second half of
2001. Interest cover based on EBITA, and excluding our associated company, was
10.6 times for the 6 months to June 2002.
The effective tax rate for the period based on pre-tax profit before
amortisation, is 35.1% which is similar to the effective tax rate in 2001.
Earnings per share pre amortisation increased by 28% to 7.8 cents for the six
months to 30 June 2002 compared to 6.1 cents for same period in 2001. The
interim dividend is 1.0 cent per share and will be paid on 18 October 2002.
John Wood Group PLC
Group profit and loss account
for the six month period to 30 June 2002
Unaudited Unaudited
Interim Interim Full Year
June 2002 June 2001 Dec 2001
$m $m $m
__________________________________________________
Revenues including share of
joint ventures
Continuing operations 809.1 683.9 1,445.8
Acquisitions - 4.4 36.6
__________________________________________________
809.1 688.3 1,482.4
Discontinued operations 3.6 24.7 41.4
__________________________________________________
Revenues including share of 812.7 713.0 1,523.8
joint ventures
Less share of joint ventures (136.4) (115.0) (243.9)
revenues
__________________________________________________
Group revenues 676.3 598.0 1,279.9
Cost of sales (513.6) (446.7) (958.5)
__________________________________________________
Gross profit 162.7 151.3 321.4
__________________________________________________
Administrative expenses (114.5) (111.6) (238.0)
Impairments - - (1.0)
Goodwill amortisation (4.8) (4.4) (9.2)
__________________________________________________
Net operating expenses (119.3) (116.0) (248.2)
__________________________________________________
Operating profit of Group 43.4 35.3 73.2
undertakings
Share of operating profit in 12.6 11.6 24.0
joint ventures
Share of operating profit in 2.8 3.4 6.5
associates
__________________________________________________
Total operating profit : Group
and
share of joint ventures and 58.8 50.3 103.7
associates
Total operating profit
comprises:
__________________________________________________
Continuing operations 59.0 49.6 101.3
Acquisitions - 0.3 2.2
__________________________________________________
59.0 49.9 103.5
Discontinued operations (0.2) 0.4 0.2
__________________________________________________
Exceptional items
Loss on the termination of - - (13.6)
discontinued operations
__________________________________________________
Profit on ordinary activities 58.8 50.3 90.1
before interest
Net interest payable
- Group (4.3) (7.8) (13.5)
- Joint Ventures (1.5) (2.1) (3.2)
- Associates (2.1) (1.9) (3.8)
__________________________________________________
Profit on ordinary activities 50.9 38.5 69.6
before taxation
Taxation on profit on ordinary (19.8) (15.2) (29.0)
activities
__________________________________________________
Profit on ordinary activities 31.1 23.3 40.6
after taxation
Equity minority interests (2.8) (2.5) (5.5)
__________________________________________________
Profit for the financial 28.3 20.8 35.1
period/year
Dividends and appropriations (6.7) (11.7) (19.1)
__________________________________________________
Retained profit for the 21.6 9.1 16.0
financial period/year
__________________________________________________
Basic earnings per ordinary 8.3 5.1 7.4
share (cents)
Diluted earnings per ordinary 6.5 4.1 6.7
share (cents)
Adjusted earnings per ordinary 7.8 6.1 13.2
share (cents)
__________________________________________________
John Wood Group PLC
Group balance sheet
as at 30 June 2002
Unaudited Unaudited
Interim Interim Full Year
June 2002 June 2001 Dec 2001
$m $m $m
__________________________________________________
Fixed assets
Intangible assets 185.2 150.0 156.2
Tangible assets 132.9 113.6 126.7
Investments in joint ventures
__________________________________________________
Share of gross assets 275.4 226.6 255.2
Share of gross liabilities (212.7) (168.4) (194.0)
Goodwill arising on 8.9 8.3 9.1
acquisition
__________________________________________________
Total investments 71.6 66.5 70.3
Investments in associates 8.3 1.1 7.2
Other investments 1.1 1.3 1.2
__________________________________________________
399.1 332.5 361.6
__________________________________________________
Current assets
Stocks 155.5 179.3 153.4
Debtors 350.9 315.7 306.0
Cash at bank and in hand 49.5 111.6 129.3
__________________________________________________
555.9 606.6 588.7
__________________________________________________
Creditors: amounts falling due
within one year
Bank loans and overdrafts (8.1) (7.9) (3.3)
Other creditors (256.7) (236.3) (232.1)
__________________________________________________
(264.8) (244.2) (235.4)
__________________________________________________
Net current assets 291.1 362.4 353.3
__________________________________________________
Total assets less current 690.2 694.9 714.9
liabilities
Creditors: amounts falling due
after one year
Bank loans (172.5) (380.5) (382.4)
Other creditors (2.8) (2.2) (2.9)
__________________________________________________
(175.3) (382.7) (385.3)
__________________________________________________
Provisions for liabilities and (11.3) (13.4) (14.3)
charges
__________________________________________________
Net assets excluding pension 503.6 298.8 315.3
(liability)/asset
Pension (liability)/asset (5.3) 1.9 (5.3)
__________________________________________________
Net assets including pension 498.3 300.7 310.0
(liability)/asset
__________________________________________________
Capital and reserves
Called up share capital 23.2 105.1 105.6
Share premium account 200.1 - -
Capital redemption reserve 88.1 - -
Profit and loss account 175.3 184.2 190.4
__________________________________________________
Total shareholders' funds 486.7 289.3 296.0
Comprising
__________________________________________________
Equity shareholders' funds 486.7 193.3 197.0
Non-equity shareholders' funds - 96.0 99.0
__________________________________________________
Equity minority interests 11.6 11.4 14.0
__________________________________________________
498.3 300.7 310.0
__________________________________________________
John Wood Group PLC
Statement of total recognised gains and losses
for the six month period to 30 June 2002
Unaudited Unaudited
Interim Interim Full Year
June 2002 June 2001 Dec 2001
$m $m $m
__________________________________________________
Profit for the financial 28.3 20.8 35.1
period/year
Actuarial loss recognised in - - (10.1)
the pension scheme
Movement in deferred tax - - 3.1
relating to pension
(liability)/asset
Exchange movement on (5.9) (14.8) (8.5)
retranslation of foreign
currency net assets
__________________________________________________
Total gains recognised in the 22.4 6.0 19.6
period/year
Prior year adjustments - 29.3 29.3
__________________________________________________
Total gains recognised since 22.4 35.3 48.9
last annual report
__________________________________________________
The prior year adjustments relate to the implementation of FRS 17 and the
reinstatement of goodwill previously written off to reserves.
Reconciliation of movement in shareholders' funds
for the six month period to 30 June 2002
Unaudited Unaudited
Interim Interim Full Year
June 2002 June 2001 Dec 2001
$m $m $m
__________________________________________________
Profit for the financial 28.3 20.8 35.1
period/year
Dividends and appropriations (6.7) (11.7) (19.1)
__________________________________________________
21.6 9.1 16.0
Issue of new shares 216.1 - 0.1
Redemption of convertible (29.6) - -
redeemable preference shares
Expenses of share issue (11.5) - -
Non-equity shares - - 8.5 8.5
appropriation adjustments
Actuarial loss recognised in - - (7.0)
the pension scheme net of
deferred tax
Exchange movement on (5.9) (14.8) (8.5)
retranslation of foreign
currency net assets
Exchange movement on - (1.1) (0.7)
retranslation of share capital
__________________________________________________
Net increase in shareholders' 190.7 1.7 8.4
funds
Opening shareholders' funds 296.0 287.6 287.6
__________________________________________________
Closing shareholders' funds 486.7 289.3 296.0
__________________________________________________
John Wood Group PLC
Group cash flow statement
for the six month period to 30 June 2002
Unaudited Unaudited
Interim Interim Full Year
June 2002 June 2001 Dec 2001
$m $m $m
__________________________________________________
Operating activities
Net cash inflow from operating 39.2 5.7 90.1
activities
Dividends from joint ventures 1.8 3.4 6.6
__________________________________________________
41.0 9.1 96.7
__________________________________________________
Returns on investments and
servicing of finance
Interest received 4.4 2.3 8.6
Interest paid (8.2) (13.7) (23.7)
Non-equity dividends paid (6.5) (3.4) (6.6)
Expenses of share issue (11.5) - -
__________________________________________________
(21.8) (14.8) (21.7)
__________________________________________________
Taxation
UK corporation tax paid (1.0) (0.9) (5.5)
Overseas tax paid (14.1) (8.7) (23.9)
__________________________________________________
(15.1) (9.6) (29.4)
__________________________________________________
Capital expenditure and
financial investment
Purchase of tangible fixed (24.4) (22.3) (51.1)
assets
Sale of tangible fixed assets 0.8 0.1 0.2
Disposal of investments 0.1 - 0.2
(Loans to)/repayment of loans (3.8) - 2.5
from joint ventures
__________________________________________________
(27.3) (22.2) (48.2)
__________________________________________________
Acquisitions and disposals
Acquisition of minority (16.4) (5.4) (5.4)
interests
Purchase of subsidiary (18.7) (10.6) (27.0)
undertakings, net of cash
acquired
Investment in joint ventures - (0.1) (0.3)
Deferred consideration - (1.0) (2.8)
__________________________________________________
(35.1) (17.1) (35.5)
__________________________________________________
Equity dividends paid (2.8) (1.5) (1.5)
__________________________________________________
Net cash outflow before
management of liquid resources
and financing (61.1) (56.1) (39.6)
__________________________________________________
Management of liquid resources
Decrease/(increase) in cash 7.2 (14.4) 36.0
placed on deposit
Financing
(Decrease)/increase in bank (206.5) 25.7 23.8
loans
Issue of ordinary shares 216.1 - 0.1
Redemption of convertible (29.6) - -
redeemable preference shares
__________________________________________________
Net cash (outflow)/inflow from (20.0) 25.7 23.9
financing
__________________________________________________
(Decrease)/increase in cash (73.9) (44.8) 20.3
__________________________________________________
John Wood Group PLC
Notes to the interim accounts
for the six month period to 30 June 2002
1. Preparation of interim accounts
The interim report and accounts have been prepared on the basis of the
accounting policies set out in the group's 2001 Annual Report and Accounts. The
interim accounts were approved by the Board of Directors on 2 September 2002.
The results for the six months to 30 June 2002 and the comparative results for
the six months to 30 June 2001 are unaudited. The comparative figures for the
year ended 31 December 2001 do not constitute statutory accounts for the
purpose of section 240 of the Companies Act 1985 and have been extracted from
the company's published accounts, a copy of which has been delivered to the
Registrar of Companies and on which an unqualified audit report has been given
by the auditors under section 235 of the Companies Act 1985.
2. Segmental reporting
Business segments
Revenues EBITDA
Interim Interim Full Interim Interim Full Year
Year
June June Dec June June Dec
2002 2001 2001 2002 2001 2001
$m $m $m $m $m $m
Engineering &
Production Facilitiies
Group 382.1 272.3 612.3 37.0 28.0 61.5
Joint Ventures 74.3 57.2 134.4 7.8 4.8 11.5
______________________________________________________
456.4 329.5 746.7 44.8 32.8 73.0
______________________________________________________
Well Support
Group 178.3 190.6 405.3 15.9 18.2 39.5
Joint Ventures 2.1 4.0 6.8 (0.5) 0.2 -
______________________________________________________
180.4 194.6 412.1 15.4 18.4 39.5
______________________________________________________
Gas Turbine Services
Group 98.4 97.9 198.0 16.3 13.3 26.9
Joint Ventures 60.0 53.8 102.7 9.3 9.8 18.7
______________________________________________________
158.4 151.7 300.7 25.6 23.1 45.6
______________________________________________________
Total excluding 795.2 675.8 1,459.5 85.8 74.3 158.1
discontinuing
operations
Gas Turbine Services - 17.5 37.2 64.3 (1.6) (2.8) (7.7)
discontinuing
operations
______________________________________________________
Total 812.7 713.0 1,523.8 84.2 71.5 150.4
==================================================
Comprising
______________________________________________________
- Group 676.3 598.0 1,279.9 67.6 56.7 120.2
- Joint Ventures 136.4 115.0 243.9 16.6 14.8 30.2
______________________________________________________
Central costs (7.2) (7.0) (14.3)
(including central
depreciation)
Share of operating
profit in associates
______________________________________________________
Total 812.7 713.0 1,523.8 77.0 64.5 136.1
==================================================
Exceptional items
Net interest payable
Profit before taxation
Note - the discontinuing operations of the Gas Turbine Services business relate
to Aero engine overhaul companies which the group has decided to divest/close.
The discontinuing revenues and operating loss above includes the discontinued
revenues and operating profit/(loss) respectively, as shown on the face of the
profit and loss account.
EBITA Operating profit
Interim Interim Full Interim Interim Full Year
Year
June June Dec June June Dec
2002 2001 2001 2002 2001 2001
$m $m $m $m $m $m
Engineering & Production
Facilities
Group 33.8 26.1 56.8 30.9 23.5 51.4
Joint Ventures 6.1 3.3 8.5 5.8 3.1 8.1
______________________________________________________
39.9 29.4 65.3 36.7 26.6 59.5
______________________________________________________
Well Support
Group 11.0 14.3 30.5 10.0 13.1 28.2
Joint Ventures (0.6) 0.1 (0.3) (0.6) 0.1 (0.3)
______________________________________________________
10.4 14.4 30.2 9.4 13.2 27.9
______________________________________________________
Gas Turbine Services
Group 13.1 9.6 20.6 12.2 9.0 19.1
Joint Ventures 8.0 8.9 17.2 7.4 8.4 16.2
______________________________________________________
21.1 18.5 37.8 19.6 17.4 35.3
______________________________________________________
Total excluding 71.4 62.3 133.3 65.7 57.2 122.7
discontinuing operations
Gas Turbine Services - (2.2) (3.0) (9.0) (2.2) (3.0) (10.0)
discontinuing operations
______________________________________________________
Total 69.2 59.3 124.3 63.5 54.2 112.7
==========================
Comprising
______________________________________________________
- Group 55.7 47.0 98.9 50.9 42.6 88.7
- Joint Ventures 13.5 12.3 25.4 12.6 11.6 24.0
______________________________________________________
Central costs (including (7.5) (7.3) (15.5) (7.5) (7.3) (15.5)
central depreciation)
Share of operating 2.8 3.4 6.5
profit in associates
______________________________________________________
Total 61.7 52.0 108.8 58.8 50.3 103.7
==========================
Exceptional items - - (13.6)
Net interest payable (7.9) (11.8) (20.5)
___________________________
Profit before taxation 50.9 38.5 69.6
========================
John Wood Group PLC
Notes to the interim accounts (continued)
for the six month period to 30 June 2002
2. Segmental reporting (continued)
Unaudited Unaudited
Interim Interim Full Year
June 2002 June 2001 Dec 2001
Net operating assets $m $m $m
Engineering & Production
Facilities
- Group 182.0 154.5 147.4
- Joint Ventures 36.0 38.1 40.0
________________________________________________________
218.0 192.6 187.4
________________________________________________________
Well Support
- Group 210.1 190.4 205.1
- Joint Ventures 2.1 4.0 2.9
________________________________________________________
212.2 194.4 208.0
________________________________________________________
Gas Turbine Services
- Group 130.8 103.2 117.1
- Joint Ventures 75.5 59.8 76.9
________________________________________________________
206.3 163.0 194.0
________________________________________________________
Total allocated excluding 636.5 550.0 589.4
discontinuing operations
Gas Turbine Services - 27.2 49.0 29.1
discontinuing operations
Unallocated 7.7 13.9 (2.6)
________________________________________________________
Net operating assets 671.4 612.9 615.9
Net debt - Group (131.1) (276.8) (256.4)
Net debt - Joint Ventures (42.0) (35.4) (49.5)
________________________________________________________
Net assets 498.3 300.7 310.0
________________________________________________________
3. Dividends
Unaudited Unaudited
Interim Interim Full Year
June 2002 June 2001 Dec 2001
Net operating assets $m $m $m
Dividends on non-equity
shares
First convertible 0.2 0.2 1.4
preference shares
Second convertible 0.4 0.4 1.8
preference shares
First convertible 0.6 0.7 1.4
redeemable preference
shares
Second convertible 0.7 1.9 3.2
redeemable preference
shares
Dividends on equity shares
Interim 4.8 - 2.8
Appropriations - 8.5 8.5
________________________________________________________
Total dividends and 6.7 11.7 19.1
appropriations
________________________________________________________
The interim dividend is one cent per share and will be paid on 18 October 2002.
4. Earnings per share
Unaudited Unaudited
Interim Interim Full Year
June 2002 June 2001 Dec 2001
Net operating assets $m $m $m
Basic EPS
Earnings 26.4 14.6 21.4
Weighted average number of 316.9 287.9 288.1
shares
EPS (cents) 8.3 5.1 7.4
Diluted EPS
Earnings 28.3 15.4 25.1
Weighted average number of 437.4 375.6 376.1
shares
EPS (cents) 6.5 4.1 6.7
Adjusted EPS
Earnings 34.0 26.1 56.7
Weighted average number of 437.4 428.4 429.0
shares
EPS (cents) 7.8 6.1 13.2
The calculation of earnings per share for the six months ended 30 June 2002 is
based on the profit for the period, after preference dividends of $1.9m and
316,908,000 ordinary shares being the weighted average number of ordinary
shares in issue during the period excluding shares held by the Group's employee
share ownership trusts. The diluted number of shares takes account of the
conversion of preference shares and share options where the effect of these is
dilutive. In the periods to June 2001 and December 2001 the convertible
redeemable preference shares are anti-dilutive and have not been taken into
account in the calculation of diluted EPS. Adjusted EPS is disclosed to show
the results excluding the impact of exceptional items and goodwill amortisation
and reflects the conversion of all preference shares to ordinary shares
throughout the period.
John Wood Group PLC
Notes to the interim accounts
for the six month period to 30 June 2002
5. Tax
The tax charge for the six months ended 30 June 2002 reflects the anticipated
effective tax rate of 35.1% on profit before tax and amortisation for the year
ending 31 December 2002 (June 2001 : 35.0%).
6. Acquisitions and developments
In May 2002, the Group acquired a further 6.63% of Mustang Engineering Holdings
Inc for a consideration of $16.1m. In late June 2002, the Group acquired
Operators and Consulting Services Inc, an oilfield services company providing
operations and maintenance support services to oil and gas producers in the
Gulf of Mexico. In August 2002, the Group acquired Industrial Repair Services
Inc a generator repair company based in New Mexico.
7. Net cash inflow from operating activities
Unaudited Unaudited
Interim Interim Full Year
June 2002 June 2001 Dec 2001
$m $m $m
________________________________________________
Operating profit from group 43.4 35.3 73.2
undertakings
Depreciation of tangible 12.2 10.0 22.5
fixed assets
Impairments - - 1.0
Amortisation of goodwill 4.8 4.4 9.2
Decrease/(increase) in 3.8 (30.8) (13.6)
stocks
Increase in debtors (15.3) (43.0) (26.7)
(Increase)/decrease in (11.5) (1.9) 0.1
amounts due from joint
ventures
Increase in creditors 5.6 39.8 30.9
Decrease in provisions (3.1) (1.4) (0.9)
Exchange adjustments (0.7) (6.7) (5.6)
________________________________________________
39.2 5.7 90.1
________________________________________________
8. Analysis of net debt
1 Jan 2002 Cash flow Exchange 30 June 2002
$m $m $m $m
____________________________________________________________
Cash 107.5 (73.9) 0.7 34.3
Deposits 21.8 (7.2) 0.6 15.2
Bank loans and (3.3) (4.8) - (8.1)
overdrafts
Bank loans due after (382.4) 211.3 (1.4) (172.5)
one year
____________________________________________________________
Net debt (256.4) 125.4 (0.1) (131.1)
____________________________________________________________
9. Pension commitments
In 2001 the Group adopted FRS 17 'Retirement Benefits' in full. The pension
liability at 30 June 2002 is as calculated at 31 December 2001 as adjusted for
current service cost, interest cost and expected return on assets. No interim
revaluation has been carried out and accordingly there is no actuarial gain/
loss in the statement of total recognised gains and losses. The figures for
gains and losses for the full year together with the surplus/deficit at the
year end will be presented in the 2002 Annual Report.
John Wood Group PLC
John Wood Group PLC
Shareholder information
Officers and advisers
Secretary and Registrars
Registered Office
C E M Watson Lloyds TSB
Registrars Scotland
John Wood Group PLC 117 Dundas Street
John Wood House EDINBURGH
Greenwell Road EH3 5ED
ABERDEEN
AB12 3AX Tel: 0870 601 5366
Tel: 01224 851000
Stockbrokers Auditors
Cazenove & Co Limited PricewaterhouseCoopers
Credit Suisse First Chartered Accountants
Boston
Financial calendar
6 months ended Year ending
30 June 2002 31 December 2002
Results announced 3 September 2002 Late February/
Early March 2003
Annual General Late April 2003
Meeting
Ex-dividend date 18 September 2002 Late April 2003
Dividend record date 20 September 2002 Late April 2003
Dividend payment 18 October 2002 Late May 2003
date
Wood Group has an Investor Relations website which can be accessed at
www.woodgroup.com
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