Amec Foster Wheeler interim profit drops amid challenging market conditions

Oil and gas services company Amec Foster Wheeler reported a 12% fall in first-half pre-tax profit amid challenging market conditions, as it said it continues to expect a reduction in trading margins.

Interim pre-tax profit fell to £73m from £83m in the same period last year, although revenue rose to £2.66bn from £1.85bn and was a touch ahead of consensus expectations of £2.64bn.

Adjusted diluted earnings per share from continuing operations was 34p, which was better than consensus expectations of 32.9p and the company kept its interim dividend unchanged at 14.8p per share.

Chief executive Samir Brikho said: “In the challenging conditions we find in many of our markets our priorities are clear: to make the most of the integrated Amec Foster Wheeler platform, innovate and adapt to offer customers relevant services and continue to keep a tight control on our own costs.

“I continue to believe our low-risk, multi-market model is a strong platform from which to create long-term value for shareholders."

The company said it expects challenging market conditions to continue, particularly in upstream Oil & Gas and Mining. However, downstream Oil & Gas, particularly petrochemicals, continues to be resilient.

Amec said Clean Energy E&C scope revenue is likely to be lower than in 2014, due to delays to the start of work for significant projects in its order book.

The company said it has a strong pipeline, which it believes can grow the order book from its current level of £6.6bn.

In addition, Amec said it remains confident it can meet full-year expectations.