Wood Group – the Aberdeen-based international energy services company – aims to cut its costs by more than $30 million over this year.
In a statement issued after its annual meeting yesterday, the company said that ‘although market conditions remain challenging’ Wood is confident that it can deliver SG&A cost-reductions. It said:
“Following our decision to reduce contractor rates in 2014, we have continued to work alongside customers on efficiency improvement initiatives.
“We are seeing the impact of reduced project work and in certain cases non-essential maintenance work, but see longer term opportunities focused on improving operating efficiency and late life asset management.
“In Upstream, activity remains subdued, continuing the trend we initially communicated in the second half of 2013. Although we still see a number of projects being deferred we remain encouraged by the high volume of early stage work as customers look to re-engineer projects with a view to improving project economics.
“We remain active on a number of detailed engineering projects – including Det Norske’s Ivar Aasen in the Norwegian North Sea and Hess Stampede in the Gulf of Mexico.
“In March we were awarded the FEED and procurement scope for Statoil’s Kollsnes gas plant in Norway leveraging our strength in automation and control engineering and our 2014 Norwegian acquisition, Agility Projects.
“Looking further ahead, we remain confident of delivering good growth as market conditions improve.”
The company said full-year profits will be ‘broadly in line’ with market expectations. The first-half trading update is due for publication on 25 June 2015.
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