Shares in the Aberdeen-based engineering company plummeted 34% in early trading on Friday after it warned of negative free cash flow this year, a reversal of previous guidance. The company also acknowledged the need for “significant improvement” in its financial strength.   

Chief executive Ken Gilmartin expressed his disappointment with the financial performance and warned of further impairments. He pledged to sell up to $200 million in assets to bolster free cash flow. “This is a difficult announcement amid our transformation,” he commented, as the London-listed company cancelled bonuses to offset the weaker trading.   

Mr Gilmartin added: “While the likely findings from the independent review are expected to have no material impact on the Group’s cash position and future cash generation, it clearly gives us areas to focus on and we are initiating steps now to further improve our financial culture, governance and controls.

“We have announced further actions to address the cost base of the business to right size Wood for the future, and have laid out a very clear route to positive free cash flow in 2026.

“As we look ahead, notwithstanding the challenges today, I am confident the fundamentals of this company remain strong – we are in growing markets, with considerable in-demand engineering skills, trusted client relationships, and we’re well positioned to grow the business.”

This marks another setback for Wood, which employs approximately 35,000 people globally. In August, Wood announced write-offs of nearly $1 billion (c. £800m) related to legacy acquisitions and its exit from certain work areas.

Concerns about the company’s performance intensified in November after it disclosed an independent review of its projects division following discussions with its auditor. The share price has fallen by almost 90% over the past five years, reducing its value to around £297m. Previous takeover attempts by Sidara and Apollo Global fell through, citing various concerns, including geopolitical risks and financial market uncertainty.

The review of the projects division, conducted by Deloitte, identified “weaknesses and failures” in Wood’s “financial culture, governance and controls”. The company is now taking steps to address these issues and is assessing potential prior-year adjustments.

With net debt of approximately $1.1bn (c. £880m), Wood is exploring “all potential refinancing options” as its debt facilities mature in October 2026.