First Time Profit Fall for WorleyParsons after Listing

WorleyParsons (WOR), the engineering group had recorded its first full-year profit drop since it was listed in 2002 as the company continues to experience downfall in its minerals and metals business amid global recession. The company yesterday stated that the net profit climbed to 390.5 million which was lower than the expectation of the market analysts who expected the figures to be somewhere around $410 million. The news had immediate impact over the WorleyParsons shares as it went 4 percent lower yesterday despite a surge in the share market. Shares dropped to $25.83 yesterday (-$1.01) for the group despite a 3 percent rise in the rest of the share market.

However, John Grill, the chief executive and founder of the group claimed that good days are coming as the company chased work from various projects (primarily oil and gas) valuing $1 trillion. Mr. Grill also claimed that the financial performance of the company was satisfactory in the difficult economic environment. However, the volatile market condition along with pressure on margin and the possible negative impact of a higher Aussie dollar might have motivated a relatively modest earnings for 2009-10, he added.

Out of its four business sectors, the minerals and metals was the only one that saw its earnings to go down this year. According to WorleyParsons, the rate of expansion of new mines was likely to be subdued. However, a recent increase in commodity price referred to a possibility that some idled projects might gain interest. Revenue was up for the full year as much as 27 percent to $6.225 billion, while earnings before interest, tax, depreciation and amortisation increased 18 percent to $693.2 million.

EBITDA was enhanced by the hydrocarbon unit as much as 26 percent that brought in three-quarters of total revenue. Power unit posted an increase of 2 percent in EBITDA to $66.5 million. WorleyParsons announced a final dividend of 55c, improving the figures from previous 47.5c.