John Wood Lifts FY25 Earnings View, Sees Negative Cash Flow; Stock Plunges

(RTTNews) - John Wood Group PLC. (WG.L,WDGJF), a British engineering and consulting business, Friday updated its fiscal 2025 adjusted earnings outlook.

Meanwhile, John Wood shares were plunging by 32% on the London Stock Exchange after the company projected negative free cash flow of up to $200 million for 2025.

For the year, the company projects adjusted EBIT between c.$205 million to c.$215 million and adjusted EBITDA between around $450 million to $460 million.

The company now expects double-digit adjusted EBITDA and adjusted EBIT growth in the year, before the impact of disposals, supported by cost actions. The outlook remains in line with market expectations. In the previous guidance, the company expected high single-digit growth in adjusted EBITDA, before the impact of disposals, helped by an expected strong performance in the fourth quarter.

The Order book increased to c.$6.2 billion sequentially from c.$5.4 billion as of September 30, 2024.

Further, the company said it now expects negative free cash flow in 2025 of around $150 million to $200 million.

John Wood plans to generate up to $200 million from asset sales in 2025 to counteract negative cash flow and keep debt levels the same as in 2024.

Positive free cash flow is expected in 2026, before disposals.

Ken Gilmartin, CEO, said: "While we have made progress, I am disappointed in our financial performance. Consequently, we are taking decisive actions to ensure we can meet the opportunities we have in growing markets, principally energy. ..... As we look ahead, notwithstanding the challenges today, I am confident the fundamentals of this company remain strong". John Wood is currently trading 31.41% lesser at 45% pence on the London Stock Exchange. On Thursday, John Wood had closed 2.38% higher at $0.86 on the OTC Market.