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UPDATE: John Wood Chair Marchant And Two Non-Executives To Resign

19th Mar 2019 11:53

LONDON (Alliance News) - Energy services firm John Wood Group PLC on Tuesday said Chair Ian Marchant, and Non-Executive Directors Jann Brown and Linda Adamany will resign.

Merchant will remain as a director & chair of the board until his successor is appointed, the company said. A process to identify a successor is underway.

John Wood said the UK Corporate Governance Code published by the Financial Reporting Council

in July 2018 requires that the chair should not remain in post beyond nine years from the date of first appointment to the board. Merchant was first appointed to the board in 2006.

"I have thoroughly enjoyed my time on the Wood board and feel I will be able to step down with the business in good shape with a sound platform for sustainable growth in the coming years," said Merchant.

Meanwhile, Brown, who also chaired the Audit Committee, is resigning due to commitments to

other executive responsibilities, John Wood said. The company said it intends to appoint an additional non-executive director to replace Jann and has started a process to identify a suitable candidate.

Adamany intends to resign in May for personal reasons, John Wood said, having been on the board since October 2017. The company said it does not intend to appoint a replacement for Linda.

"I would like to thank both Jann and Linda for their dedication to Wood. They have provided invaluable support to Wood at a time of significant development and we wish them the very best for the future," said Marchant.

Also on Tuesday John Wood said that it swung to an annual profit, with its acquisition of Amec Foster Wheeler driving significant growth.

Aberdeen-based John Wood bought peer Amec Foster Wheeler in October 2017 for GBP2.20 billion, so 2018 was the first year reported on as a combined group.

For 2018, revenue on a statutory basis rose 86% to USD10.01 billion, and including joint ventures by 79% to USD11.04 billion. Pro forma, revenue including joint ventures climbed 12% to USD9.88 billion.

Pretax profit for John Wood in 2018 was USD53.5 million, from continuing operations, after a loss of USD21.6 million in 2017. Before exceptional items, pretax profit rose 50% to USD244.8 million from USD162.9 million.

It is paying a final dividend of 23.7 US cents, taking the total for 2018 to 35.0 cents, 2.0% higher on the prior year.

Net debt declined 5.9% as of the end of 2018 to USD1.55 billion, while the order book at the same time stood at USD10.26 billion. Some 60% of forecast revenue for 2019 has been secured, John Wood said.

"John Wood returned to growth in 2018 with good momentum in trading and a significant impact from cost synergy delivery," said Chair Ian Marchant.

"Results benefited from relatively favourable conditions in the wide range of energy and industrial end markets Wood now operates in, despite a slower sector recovery in oil & gas."

All business divisions saw "high" activity, John Wood said, across various industries and geographies.

Looking to 2019, revenue growth is guided at around 5%. Combined with further cost savings, earnings are thus guided to grow in line with market expectations.

The market, John Wood said, sees adjusted earnings before interest, tax, and amortisation in 2019 of USD716 million, after USD630 million in 2018, up 69% year-on-year.

"Looking ahead, there is a very positive medium term outlook for Wood's broader end markets. The board is confident Wood is well placed to deliver good longer term growth both organically and by a return to acquisition led growth that aligns with our long term preferred capital structure," Marchant added.

Shares in London were 8.5% lower on Tuesday at a price of 547.60 pence each.


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