WorleyParsons downgrades guidance
WorleyParsons Limited (WOR) opened 11.4% lower after the oilfield-engineering firm downgraded its FY10 profit guidance due to weakness in its US operations. The company advised that its current NPAT expectations for the year are in a range of $280 million to $320 million.
In October WorleyParsons advised an expected NPAT in the order of $320 million to $335 million.
The company said that since the October update, several of its regions have performed above expectations, while some have underperformed them.
“Power operations, particularly in the US, have been adversely affected by decreased demand and increased legislative uncertainty concerning the treatment of carbon,” WorleyParsons said.
“The market for our services in the US domestic refining and petrochemicals industries has weakened significantly.”
The company added that the recently announced acquisitions of Australian infrastructure services company Evans & Peck and Brazilian services group CNEC Engenharia would not contribute significantly to the company’s second half result.
”The contribution from both acquisitions was anticipated in the previous outlook provided,” WorleyParsons said.
The company said it is encouraged by increasing activity in a number of regions and customer sector groups supporting its view of a more significant weighting of earnings to the second half of the financial year.
At the open Wednesday, WorleyParsons shares were trading down $3.35, or 11.4% at $26.00.
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