Worley (ASX:WOR) share price drops on latest contract award

A new contract to maintain 6 wind farms fails to lift the engineering company out of the red today

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The Worley Ltd (ASX: WOR) share price is in the red today. The price movement comes despite the company being awarded a new contract to maintain a wind farm.

At the time of writing, shares in the global engineering company are down 2.59%, trading at $11.65. In comparison, the S&P/ASX 200 Index (ASX: XJO) is currently 0.22% lower.

Let’s take a closer look at today’s news.

What did Worley announce?

In a statement to the ASX, Worley says it has been awarded “two operations and maintenance services contracts” for 6 wind farms in Victoria owned by Pacific Hydro.

Worley will provide “full asset management, operations, and maintenance services” for nearly 200 wind turbines and other equipment. The term of the contract is 10 years for half the sites and 5 years for the remainder. Worley did not disclose the value of the contract.

The Worley share price also fell on Tuesday, when the company announced the signing of a new contract.

Management commentary

Worley CEO Chris Ashton said:

We are pleased that Pacific Hydro has chosen to continue its long-term relationship with Worley and extend our role in supporting the generation of renewable energy on these wind farms.

As a global company headquartered in Australia, we are helping our customers adapt to the world’s changing energy needs through bringing Worley’s global expertise and capability in renewable energy.

Worley share price snapshot

The Worley share price has increased 32.3% over the past 12 months but it still has not recovered since the COVID market crash of March last year.

On the first trading day of 2020, Worley shares finished that day at $15.34. The current share price of around 11.6% is some 20% lower than that level.

In fact, in the last 52 weeks, the highest point the Worley share price has reached is $14.01.

Worley Ltd has a market capitalisation of around $6.3 billion.

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The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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