WYG set to return to profit growth this year
GLOBAL PROJECT management consultancy WYG said it is taking the right steps to return to profit growth after reporting a loss of over £5m in the year to March 31.
The Leeds-based group was hit by £2.5m in provisions for legacy contract claims and the £3.2m cost of closing its North Associates operation. The firm said it has taken steps to stabilise the business position in case of a Brexit impact.
CEO Douglas McCormick said: “These results reflect an improved second half despite the continued delays experienced by our Turkish business.
Having posted a disappointing set of results at the half year, the team has taken action to start to offset the issues we highlighted in August and November, and there have since been several positive developments ensuring that we met the market’s revised expectations of our profit and cash performance.”
The group said it has completed a significant step to stabilise WYG’s position in light of the potential impact of Brexit.
“Many of the major projects in both of our principal business streams that were delayed in 2017 are now being delivered and our strong order book underpins a significant proportion of 2019’s projected earnings,” he added.
“We have a clear strategy in place, a reshaped leadership team and a strong wider group with deep expertise in our chosen markets.”
Analysts at N+1 Singer said in a note: “Second half operating profit of £2.5m was more than double the first-half result, reflecting seasonal factors as well as the actions taken to address recent under-performance.
“The order book is growing in both business streams and WYG is now showing encouraging signs of stability.”
Analyst Nick Spoliar at WH Ireland said: “After a positive second half, results from WYG are fully in line with expectations, notwithstanding earlier challenges.
Consultancy Services has seen a solid seven per cent increase in the order book, while international orders are up 27 per cent, supported by a favourable climate in the company’s typical socio-economic and infrastructure projects, which are supported by governments and international agencies.”