The Worley Ltd (ASX: WOR) share price is trading higher this afternoon, up 3.7% at $10.93 a share at the time of writing.
This follows 2 ASX announcements from the professional services company today. They include news on a front-end engineering design (FEED) contract and the release of Worley's half-year results for FY21.
Let's hone in on the company's results during the period it described as "challenging" ending 31 December 2020.
Worley delivers results in a challenging business environment
Worley reported an aggregated revenue of $4.5 billion, down on the $6 billion revenue reported for the same period in FY20.
Statutory net profit after tax and amortisation (NPATA) was down 61% to $60 million, compared to $154 million in the prior corresponding period (pcp).
The service firm's underlying earnings before interest, tax, depreciation and amortisation (EBITDA) fell from $366 million in the first half of FY20 to $207 million for HY21.
Underlying operating cash flow also dropped to a net inflow of $281 million, compared to $361 million in the pcp.
Worley reported underlying basic earnings per share (EPS) of 22.3 cents, a much lower result than the first half FY20 EPS of 41.5 cents.
The Worley board of directors declared an unfranked interim dividend of 25 cents per share.
CEO insight and group outlook
Commenting on the results, Worley CEO Chris Ashton said:
The actions we have taken during the period have set the business up for the future. We have continued to deliver on our operational savings program, with a total of $286 million savings delivered as at 31 December 2020, exceeding the original target of $275 million. Today we announce the target is increased to $350 million to be delivered by 30 June 2022…
Although the coronavirus pandemic has resulted in several project delays, the company expects the projects to return as the global economy continues to recover. Worley also noted that there had been minimal project cancellations throughout the pandemic.
The business will maintain a diversified client portfolio to accommodate the fact that different industries will recover at different rates as the world returns to pre-COVID-19 conditions.
Worley expects an improved EBITA in the second half of FY21 compared to H1 FY21. This follows the award of new projects and the future benefits from cost reductions implemented during the first half.
Worley share price snapshot
Worley is a global provider of professional project and asset services in the energy, chemicals and resources sectors. The company has a current market capitalisation of $5.4 billion, with 522.1 million shares outstanding.
The Worley share price has dropped 25.14% over the past 12 months.
