Wood Group (john) Share Discussion Threads

[pogue] 04/11/2024 17:03

I cannot say for certain Wood bid with no VAT but I am pretty sure they did not account for it when calculating costs of paying their contract engineers as they did not allow them to apply VAT to their invoices as they ran the internal agency that generated their invoices, another very odd practice not allowing contractors to write their own invoices.
No other UK contractor is bidding without VAT I suggest as only Wood had the legal counsel advice saying it was safe to do. I know of no other EPC that is stopping their contract engineers from putting VAT on their invoice.

[willie99] 04/11/2024 16:42

Pogue,

You have raised an interesting point re the Vat. If Wood were bidding and winning work without including the Vat charge, you would imagine all other UK based contractors would be in the same boat, as they would have presumably received the same legal advice. Or, do you think this may be something peculiar to the way Wood has chosen to bid work, to obtain a competitive advantage?

If HMRCs wording is ambiguous they should make it clear, and apply the revised wording to all future bids. HMRC should not be holding companies accountable if their guidance is ambiguous, but I guess there may have to be a legal test case to arbitrate on that point.

[pogue] 04/11/2024 16:25

hazl
WG
the worry about the plenty of work bit is as I said on Saudi projects. They have won ones there they did not even expect to win hence the mad recruitment spree. I suspect the price was what swung it with the Saudis as WG would have not included the VAT charge in their calculations so those projects maybe an issue not an asset. I dont know how they did their bids though maybe they had the VAT charge in there just in case, I dont believe so though. Whatever way things are the story has changed there.

CTL
I am not worried at the price I understand the issues there and am just waiting for the newsflow to begin. The delay to the ASX listing is the issue had everything gone as planned there would have not been an emergency fundraise which has screwed the price, it will happen though. I am waiting for more info on date of ASX listing before taking my average down.

[theoriginalwonderstuff] 04/11/2024 15:32

I'm just wondering... Have the results leaked? Are they bad??

[pogue] 04/11/2024 14:11

wrong board

[hazl] 04/11/2024 13:57

WG.


At least they have plenty of work!

Worse things happen at sea as they say.

[hazl] 04/11/2024 13:56

While you're there sorry to see the plunge in CTL hope you're ok.

[pogue] 04/11/2024 13:56

Wood are recuiting still for all the work they have and have been looking for engineers for a while. Problem is many of the big projects thay have won are for Saudi which is the contracts that they now have to pay VAT on having previously not.

[hazl] 04/11/2024 13:54

Just thought I'd point out your previous post, when I mentioned I had bought in WG.
Things change all the time of course but I think I will stay put for now.
Things never stay the same for long and I really bought these for the future, hence why I don't post here much.

We live in uncertain times but time passes.


pogue - 28 Sep 2024 - 11:14:51 - 69096 of 70297 Wanobi & AAZ - AAZ
'WG in the SE is booming just now cannot get enough engineers to do the projects which are mainly Saudi. I declined an offer there a few weeks ago rates too low plus they have a very dodgy rule that contractors cannot charge VAT on their invoices as the project is in Saudi which is a VAT free country so according to their legal counsel VAT is not chargeable. This reduces their costs when bidding so are able to win all the Saudi contracts which are a lot just now. I am pretty certain that HMRC will catch up at some point but it's the contractors that will get the pain as they did not charge VAT mind you WG run the agency that all contractors must go through. Interesting times there and I dont want involved.
Aberdeen I am assuming is quiet as the NS gets run down though they seem to be agreeing to become the engineering hub for BP world wide to allow BP to sack what's left of their engineers. Makes sense for both companies.'





IMO

[pogue] 04/11/2024 13:49

hazl
they do have lots of work but this VAT issue has been runnng for years and has now come home to roost. I had given up on HMRC investigating this.

I did not go short.

[hazl] 04/11/2024 13:43

Oh I see you are short.
pogue - 04 Nov 2024 - 13:36:10 - 70296 of 70297
'Possible short at WG. I posted the belwo message on that board. I have a copy of the letter that went out to all the contractors that have worked there for a few years.


'

[hazl] 04/11/2024 13:41

I thought you indicated, on a different board that they had a lot of work and took that as a positive before.
We shall see.
Thanks for your thoughts none the less.

[pogue] 04/11/2024 13:06

I am not a holder here currently but work in the industry.
I suspect WG are going to have a very large bill to pay they did not plan for.
For many years WG have decided with legal counsel that they did not have to pay contractors VAT on work done on projects where the country the project was for did not have VAT. I have looked into this and if you read HMRC rules at an angle you can probably agree to that. However, HMRC have decided you have to read it more straight forwardly than that and now contractors going back 4 years have been instructed to submit VAT invoices for the work they have done there. Contractors make up about 70 to 80% of the workforce typically. This is a lot of money. I cannot estimate it but all Saudi projects are affected and they have been running for years. There may even be a court case brought by contractors as they are now going to have to pay the penalties on unpaid VAT going back 4+ years but they would need to get organised to do that which maybe something that wont happen.
Going forward they will win less Saudi work which has been a large part of their work in England for a few years as they were bidding lower than others I believe to win the work as they did not charge VAT. It could affect their profitability on said contracts as well if they did bid 20% less. Lot to digest there and numbers may start to emerge in the future. Something to be mindful of.
All in my opinion not investing advice.

[theoriginalwonderstuff] 30/10/2024 14:33

I probably am...When I buy in, this will definitely tank...That's my luck with the market at the moment... Just look at GSK!

[dealy] 30/10/2024 13:42

most small caps are rising since the budget speech. communism seems to have been postponed

[theoriginalwonderstuff] 28/10/2024 12:24

lol...I'm tempted to dip my toe in today...

[hazl] 25/10/2024 18:01

Ha it's blue just to catch you out!

He who hesitates is lost.....comes to mind.


8-)

[theoriginalwonderstuff] 25/10/2024 13:28

I did think I'd dip my toe in today, but I think there are a few more red days coming with RR and her budget in the offing!

[dealy] 25/10/2024 07:21

now is your chance

[hazl] 23/10/2024 19:04

Thanks for pointing that out dealy.
I failed to notice.
Good stuff.

[dealy] 23/10/2024 16:57

Franklin now in with a 5%stake (seems to be in from zero)

[theoriginalwonderstuff] 23/10/2024 10:54

I guess it's the same as buying a used car., bulk buying household essentials, etc.,... Everyone tries to time their purchase for the moment when they think they'll achieve the biggest discount...

[warren bluff it 1] 22/10/2024 18:57

So what's the problem with buying a stock at 1.35 if you truly believe it's worth 2.00

[hazl] 22/10/2024 13:20

Tick tock!

[hazl] 22/10/2024 13:20

I think that the results will be interesting.

I notice prices can be very erratic before results, might even be nothing to do with buys or sells.
However I think they ought to work up to them!