Wood chief executive Robin Watson insisted yesterday the Aberdeen-based energy service giant was getting its debt under control.
He was speaking after Wood announced the sale of its nuclear business, which employs about 2,000 people, mainly in north-west England, for £250 million.
Mr Watson said the group was on track with asset disposal plans aimed at slashing its debt pile following the acquisition of Amec Foster Wheeler two years ago.
But net debt of £1.46 billion at the end of June missed guidance that it would be closer to £1.32bn. The company said this was due to a delay in two cash receipts that were expected in June but not received until July.
Investors seemed unimpressed by Wood’s latest interim results, despite pre-tax profits of £50.8m during the first six months of 2019, compared with losses of £20.7m a year ago.
This was despite a 2.6% decline in revenue during the period to £3.96bn, slightly undershooting guidance that it would be in line with the previous year.
Mr Watson said: “We’ve had a good first half in terms of profitability and margin improvement. We are confident about our outlook, which will deliver growth and jobs.
“Selling our nuclear business has got our leverage plan on track and in line with the net debt position we want to get to.”
Shares fell more than 4.5% to 430.4p after investors digested news of Wood selling part of its business to US group Jacobs in a deal expected to complete before the end of March.
The nuclear arm provides engineering design and maintenance for a few sites, almost all of them in the UK.
Its projects include a 20-year contract – potentially worth £770m – to provide engineering design services to support Sellafield’s nuclear decommissioning programme.
The £233m-a-year nuclear division owns and operate the UK’s largest independent nuclear research and testing facilities, including more than 129,000sq ft of labs and test rigs, plus remote handling and inspection technology.