Wood Group Scores Gabon Deal after Tough First Half
Wood Group announced Tuesday that it has received a multi-million dollar contract with Shell for work in Gabon as the UK-based oilfield engineer announced reduced revenues and profits for the first half of 2015.
The deal with Shell will see Wood Group PSN supply engineering, construction and industrial services to Gabon's onshore Rabi, Gamba, Toucan and Koula fields. The award represents Wood Group PSN's first major contract in Gabon and will provide employment opportunities for around 200 Gabonese nationals, the firm said.
In its second-quarter results statement, Wood Group announced that its first-half revenue was down 19.3 percent at $3.1 billion (1H 2014: $3.8 billion), while its profit at the EBITDA level fell 7.4 percent to $225.9 million. (1H 2014: $244 million).
Wood Group said that conditions in the oil and gas market "remain very challenging". This has resulted in headcount reductions so that group headcount is down 13 percent on December and down 17 percent on June 2014. A spokesperson for the firm told Rigzone that worldwide headcount, including group services and joint ventures, was approximately 36,000 at the end of June this year.
As a consequence of these cuts Wood Group achieved $40 million of cost savings during the first half, ahead of expectations.
As well as the Gabon deal announced Tuesday, Wood Group noted that it has recently secured new long-term awards in the North Sea as well as in Saudi Arabia and Mexico.
CEO Bob Keiller commented that the firm's performance in the first half "demonstrates our commitment to cost discipline and resilience and flexibility" of its business model.
He added: "With little prospect of short term improvement in market conditions, we will focus on remaining competitive and protecting our capability, working with clients to reduce their overall costs, increase efficiency and safely improve performance."
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