International energy service company Wood Group revealed yesterday that pre-tax profits for last year surged by 48% to £274.3million.
Chief executive Allister Langlands said, however, that 2009 would be a more challenging year for the industry as a result of the weakness in oil and gas prices and global economies.
He also said that Aberdeen-based Wood was well positioned to take advantage of opportunities for acquisitions and organic investment which were likely to emerge.
Mr Langlands told the Press and Journal that the group typically made three or four “bolt-on” buys of other firms each year, which took Wood into new geographic or service areas.
The chief executive said the company was looking at two or three opportunities, which were each in the under-£36million range.
Wood operates in 46 countries and employs some 28,800 people.
Last year’s turnover was up 18% to nearly £3.75billion, while earnings before interest, tax and amortisation (Ebita) were ahead 39% to £315million.
Chairman Sir Ian Wood said: “2008 was a very successful year for Wood Group, with record revenue and Ebita. Looking into 2009, Wood Group’s strong order book, focus on production support, our good international spread and our high-quality customer base all stand us in good stead in these more challenging markets.
“The current market provides opportunities as well as challenges and we are focused on delivering innovative and creative solutions to achieve cost reduction and efficiency improvements for our customers.
“Longer term, we believe the fundamentals for oil and gas services remain strong and we are well positioned to capitalise on our high differentiation and market-leading positions to deliver good growth.”
Wood Group Engineering (North Sea) said in January that more than 1,000 contractors would see their pay cut by an average of 10% as oil companies felt the impact of lower crude prices.
The dramatic fall in oil prices from last summer’s highs has had a negative impact on share prices across the energy industry.
Wood shares hit a high of 503.5p in the past 52 weeks and a low of just under 152p in that period.
They closed 1.25p lower last night at 184p.
Mr Langlands also said there was nothing new to report on the stalled plans for Wood to move its HQ to a new site in Aberdeen.
Plans to shift from Greenwell Road, East Tullos, to £60million offices in the city centre were originally announced in 2007 but Wood said in January that the developer was unable to proceed and the energy service company was reassessing its options.
Mr Langlands added that Wood was quite happy to remain in Greenwell Road at the moment.