WYG optimistic it can improve operating margins from ‘unacceptably low levels’
Listed project management consultancy WYG expects to report a full year results in line with expectations as it this morning announced the implementation of a “business-wide efficiency review” to improve operating margins.
The Leeds-based group this morning issued a trading update ahead of its AGM, which take place later this morning.
Douglas McCormick, Chief Executive Officer of WYG, said: “Our performance for the year to date is broadly in line with market expectations for the full year and, while we have seen some softness particularly in our international operations, we continue to work hard to deliver a significant and sustained improvement in operating margins from current unacceptably low levels, together with a more consistent cash conversion profile.
“We are making progress in developing a simpler, more robust business platform and implementing the recommendations identified in our business-wide efficiency review. Our outlook for the full financial year remains unchanged.”
At the AGM the Chairman will make the following statement: “The Board expects revenue and operating profit (before separately disclosed items and share-based payments) for the half year to be broadly in line with the comparative period for the prior year. The benefits of actions taken to improve the efficiency and profitability of the business have offset some softness in trading in particular in our International Development business where we have seen some delays in opportunities coming to market and a slower ramp up of activities on certain existing projects, alongside a high level of bidding costs falling within the period. Our expectations for the full year are unchanged, namely that revenues will be at a similar level to last year and that the Group will record a modest improvement in operating profit for the year as a whole.”
Current net debt is approximately £15m including a £3m receivable from one of its International Development Business’s clients, where anticipates receipt of the outstanding balance “very shortly”.
The Group’s order book of secured contracts at 31 August stood at £161.3m.