New profits warning at John Wood

OIL services group John Wood issued its second profits warning in six months today, sending its shares down 9p to 119p.

The Aberdeen-based company, which floated in mid-2002, said delays with deepwater contracts, lower productivity in its engineering division and rising costs related to international expansion, meant it would miss its financial targets. Pre-tax profits of £60m were expected.

The firm, which operates and supports oil production and services power-generating equipment, said earnings before interest, tax and amortisation (EBITA) for 2004 would be 'somewhat lower' than last year.

Wood said it saw higher revenues this year and that business trends were broadly as it had anticipated. It saw good profit growth in well support, but not in its two other divisions.

In May, Wood said it would take a charge in 2004 for its underperforming gas turbine servicing business - on the same day rival Abbot Group said trading was satisfactory and the outlook for international operations 'extremely buoyant'.

Across the group, Wood was more upbeat about the prospects for next year and said it was increasingly confident it would return to 'acceptable growth' in 2005.