12th Jan 2005 07:00
AMEC PLC12 January 2005 PRE-CLOSE TRADING UPDATE Highlights • 2004 trading in line with market expectations• Board maintains its positive outlook and is confident that AMEC will deliver further growth in 2005 AMEC plc, the international project management and services company, isproviding this trading update for the year ended 31 December 2004, in line withits normal practice, ahead of its preliminary results announcement on 10 March2005. AMEC announced in its interim results announcement on 2 September 2004 that itexpected to make overall progress in 2004 and is pleased to confirm thatperformance was in line with market expectations. Since the interim results, AMEC has been reclassified as a Support Servicescompany and on 2 December 2004 announced a revised statutory segmental analysis,which better reflects its ongoing business portfolio. The segments areEngineering and Technical Services, Oil and Gas (AMEC's largest end market) andProject Solutions. The Engineering and Technical Services business delivered a robust performancein 2004. Activity levels in Oil and Gas remained high, with new business beingsecured from clients around the world and a significant increase in projectactivity being seen in the Canadian Oil Sands during the year. However, aspreviously reported, recognition of profit on certain Oil and Gas projects isbeing deferred until the level of capital employed declines, which is expectedduring the first half of 2005. Performance in the Project Solutions business wassteady, nothwithstanding AMEC's exit in the first half of 2004 from ConstructionManagement in the US, together with the disposal of regional French constructionbusiness Spie Batignolles. As expected, net debt declined from £389 million as at 30 June 2004 toapproximately £300 million as at 31 December 2004 (31 December 2003: £218million). The increase over the year largely reflects increased capital employedin the Oil and Gas business. This temporary increase declined prior to theyear-end, with net debt expected to return to more normal levels during thefirst half of 2005. Order intake in the Engineering and Technical Services business continues togrow, whilst the order book in AMEC's Oil and Gas and Projects Solutionsbusinesses remains solid. Outlook Continuing progress is expected in the Engineering and Technical Servicesbusiness, whilst the outlook in oil and gas markets remains good. High levels ofUK Government spending are expected to provide ongoing opportunities in theProject Solutions business, with the company's urban regeneration, PPP (whereAMEC is currently preferred bidder on three projects) and wind energy activitiesrepresenting important areas of profitable growth for the medium and long term. Overall, the board maintains its positive outlook. Taking into accountopportunities in Iraq, together with the effects of the disposal of SpieBatignolles and transfer of UK rail maintenance work in 2004, the board isconfident that AMEC will deliver further growth in 2005 in line with its earlierexpectations. Chief Executive, Sir Peter Mason, said:"I am pleased with our overall progress in 2004, having made further importantsteps in shifting the balance of our activities towards services andinvestments. "Our businesses are well positioned in their respective markets, where prospectsremain generally good and I am confident that AMEC will deliver further growthin 2005." A telephone conference call for analysts and investors will be held at 8.30amtoday. Enquiries to: AMEC plc + 44 (0)20 7634 0000 Analysts/Investors:Stuart Siddall, Finance DirectorNeil Jamieson, Director of Investor Relations Media:Juliet Sychrava, Director of Corporate CommunicationsCharles Reynolds, Head of Media Relations AMEC plc is an international project management and services company thatdesigns, delivers and supports infrastructure assets for customers worldwideacross the public and private sectors. AMEC employs 45,000 people in more than40 countries, generating annual revenues of around £5 billion. AMEC's shares aretraded on the London Stock Exchange where the company is listed in the SupportServices sector (LSE: AMEC.L). Internet users will be able to view this announcement, together with otherinformation about AMEC plc, at the company's web site www.amec.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
AMFW.L