Wood Group (john) Share Discussion Threads

[badtime] 03/10/2008 21:49

300p nxt stop?...ouch

[wjccghcc] 16/9/2008 22:52

Their exposure to the Canadian oil sands is through IMV projects which they bought last year. IMV's PBT for 2007 was $23mm vs group PBT of $260mm. They paid $140mm upfront with an earnout to 2014.

[badtime] 16/9/2008 21:25

hmmm...thinking

[silverfern] 16/9/2008 20:21

"Shares in John Wood Group and AMEC down 6.7 and 5.5 percent respectively in tandem with a weaker crude price and after RBS highlights worries that at current levels key Canadian oil sands projects could be uneconomic. " A big fall today but I remain out til I can decipher canadian oil sands from the price of crude

[dancing piranha] 16/9/2008 17:05

At this rate 300p is on the cards, what a bargain that would be!

[badtime] 16/9/2008 09:41

hmm...hits 350 and i might pik up a few more

[jibba_jabba] 14/9/2008 20:27

Bought some on Friday @415, this arrived in my mail box today..

Wood Group, a Buy at 414.25p

Says Robert Sutherland Smith
of UK350.com

Today on UK-Analyst.com we bring you a recent tip from cautious, long term, blue-chip investor Robert Sutherland-Smith of UK350.com...

The John Wood Group (WG.) has some solid looking attractions for sterling based equity investors living beneath the grey skies of a sunless English August. To judge from the results from the six months to 30 June 2008, the Aberdeen based oil services and Gas Turbine business, represents a splendid exit from gloomy UK expectations of general industrial stagnation, possible receding economic growth and the falling exchange value of the pound. Who says that nothing joyful can come from the granite city of old Aberdeen? In fact, although the oil services in Aberdeen were born to exclusively serve the North Sea oil sector, they are no longer dependent on North Sea production, which is estimated to be declining at an estimated 8% a year. Instead, Aberdeen now serves the needs and demands of the global oil industry and the Wood Group are a growing exampler of that change in market orientation, with its own growing international customer base.



In the first six months of the current year to 30 June last, good news was appropriately gushing. Revenue increased by 19% to 2.5 million US dollars (this is a company that understandably accounts in Greenbacks). Profits before charging taxation and amortisation (what some people call EBITA and I prefer sensibly, to think of as trading profit) actually jumped 44% just under 145 million dollars in line with profits before taxation (up 45%), basic earnings per share (up 45%) and adjusted diluted earnings per share up 47% to 24.7 cents. The interim dividend payout to shareholders was raised 40% to 2.8 cents where it is covered nearly nine times by adjusted diluted earnings. All this meant operating cash flow 88 million dollars (in a growing business lower than last year's 112 million dollars) and balance sheet cash and near cash figure of 129 million dollars – significantly up on the opening cash balance of 117 million dollars. Net current assets of just fewer than 1.8 billion dollars handsomely took care of current liabilities of about 1 billion dollars and generating extra net working capital of 772 million dollars.


So can it go on? Well, judging from the comments of the company's management, it can and will; for several years is the probable expectation. Operating margins were up significantly to 8.2% from just under 6.9% in the six months to June 2007. Moreover, the company explicitly thinks that there is potential for more margin improvement. The statement was bullish. Markets were described as robust and demand expected remains high, translating into strong growth with this year's results ahead of expectations. In anticipation, the company invested just under 93 million dollars into acquisitions and capital expansion – 43% up on the previous year's figure of 65 million dollars. Apart from growth in demand for engineering services for the oil industry from up stream refining, to down stream oil production there was also a strong increase for Wood's gas turbines which provide convenient solutions for rapidly rising world electricity requirements, particularly in the emerging economies and bringing a new meaning to the words of the song 'The Northern Lights of Old Aberdeen', normally sung after dram or two.

A glance at ShareCrazy quote page shows that these shares at 414.25p, on a reported historic price to earnings ratio of 19; a high rating given the general malnourished expectations for markets now. But is it too high to justify a purchase? There are good reasons for suggesting they are not (although the shares may come back a little on the basis of profit taking after good results and trading statement). First, I estimate earnings per share of 27p for the year as a whole bringing the estimated forward multiple down to 15.3 times. Given momentum of growth apparent in the company now, I think that will look good value in light of further estimated earnings growth next year. Remember also that the John Wood Group is a scarce, contra-cyclical, US dollar accounting growth prospect driven by the lagging surge in spending by the world oil industry at a time of shortage in capacity. According to informed observers, capital spending by oil producers and refiners will wonderfully economic and profitable at crude prices significantly below the current 101 dollars for a barrel of West Texas Intermediate. Some believe that it would still be true at 80 dollars; a figure believed to be the working assumption figure of many oil production projects. As icing on the cake, the dollar has become attractive again as Sterling and the Euro lose luster on the back of declining economic expectations this side of the Atlantic. Buy.

[dextroisomerism] 06/9/2008 17:12

At these prices, I think there is going to be a lot of merger/takeover activity in this sector in the next 6 months.

[dasv] 05/9/2008 11:15

Good write-up in Fat Prophets UK equities today. In short, well capitalised, well diversified, fortunes not correlated with oil price, good technicals, got cash. Buy at around 410p

[juju43] 29/8/2008 23:28

yep , i smell new highs

[badtime] 29/8/2008 18:21

bought a few of these last week ...perhaps i shud hav bought a few more..lol

[dasv] 29/8/2008 17:35

meaning new highs...

[miguel] 29/8/2008 14:38

juju43 - 29 Aug'08 - 14:00 - 108 of 108


this could get interesting from here

Meaning??

[juju43] 29/8/2008 14:00

this could get interesting from here

[slim9] 28/8/2008 12:57

WSM resuts out also............

[silverfern] 28/8/2008 12:46

looks like an earlier poster was right- shorters having to close. PFC results yesterday hsow the health of this industry. If the market does decide to settle this is a great ge=-in price imho

[slim9] 28/8/2008 09:54

2.8c = 1.4p interim * 1000 shares = £14

Full yr approx £35 per 1000 shares

[l2e] 26/8/2008 21:03

Mercier et Camier
do you know the dividend amount in sterling?
quality company here of course, looking for entry sub £4 if v very lucky.
thanks in advance and all the best all

[slim9] 26/8/2008 10:05

Introduction

The first half of 2008 has seen continued strong growth and we are pleased to
report another excellent performance. Overall, our markets are robust and the
demand for our services remains high. We expect the strong growth to continue
and believe results for the year will be ahead of expectations.

Results

Trading performance Interim Interim Change
June 2008 June 2007
$m $m

Revenue 2,526.9 2,117.3 +19%

EBITA1 207.9 144.6 +44%

EBITA margin % 8.2% 6.8% +1.4% points

Profit before tax 181.3 124.0 +46%

Profit for the period 120.6 82.5 +46%

Basic EPS (cents) 23.7 16.3 +45%

Adjusted diluted EPS2 24.7 16.8 +47%
(cents)

In the first half revenue increased by 19% to $2,526.9m and EBITA increased by
44% to $207.9m. The strongest revenue growth arose in Engineering & Production
Facilities, particularly from our engineering activities. EBITA margins
increased in all areas, notably in Engineering & Production Facilities and Gas
Turbine Services, where they increased from 8.1% to 9.5%, and from 6.1% to 7.4%
respectively. We believe there is potential for further margin improvement in
all divisions. We maintained our focus on developing our market leading
positions and extending our range of services, and invested $92.9m in
acquisitions and capex (2007: $64.7m)

[slim9] 26/8/2008 10:00

Oil services group John Wood posted a 46% rise in first-half profit to $181.3m and added it would to beat full-year expectations with all major business areas showing good growth with upstream very active and strong demand for subsea engineering activities. Revenue rose by 19% to $2.53bn.

[mercier et camier] 26/8/2008 08:56

The results are excellent. The fall is people opening shorts. The dividend date is the 05/09/08. There will be buyers and shorts will close before then. This company is going from strength to strength.

[silverfern] 26/8/2008 08:45

great results - really good - bad market. Still holding on the basis of these results

[silverfern] 21/8/2008 15:21

downtrend broken alright - results due on Tuesday