Wood Group expects first half figures to be worse than last year

Oil and gas company John Wood Group reported an expected decline in performance for the six months to 30 June, 2015.

The company said first half figures for 2015 would be down compared with 2014 due to challenging conditions in the oil and gas markets.

However it said cost reduction initiatives meant it was delivering significantly savings in excess of original targets.

In a statement on Thursday the FTSE 250 firm said there is no change to overall guidance and it expects full year earnings before tax and interest to be broadly in line with analyst consensus.

While upstream activity levels remain subdued, the company said it had seen a good contribution from larger engineering projects. John Wood Group said its subsea business had been active on several projects, but fewer large subsea capex projects were coming onto the market.

Meanwhile, the company has entered a $250m agreement for operating services on the Central Area Transmission System, or the pipe which moves natural gas from the North Sea to Teesside in England.

The ten year deal is subject to regulatory clearances.

Shares in John Wood Group closed at 679.50 on Wednesday.