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Wood Group (John) PLC  -  WG.   

Final Results for the year to 31 December 2017

Released 07:00 20-Mar-2018

Final Results for the year to 31 December 2017

JOHN WOOD GROUP PLC
GROUP FINANCIAL STATEMENTS
FOR THE YEAR TO 31st DECEMBER 2017

Company Registration Number SC 36219

20 March 2018

Full year results for the year ended 31 December 2017

“2017 was a year of transformational strategic development. The acquisition of Amec Foster Wheeler in October brought together two businesses and three brands to create Wood, a global leader in project, engineering and technical services delivery. We are a broader business with multi-sector, full service capability across energy and industrial markets and a stronger, more balanced offering in oil & gas. Integration is progressing ahead of schedule with initial cost synergies achieved earlier than plan. Financial performance for 2017 is in line with guidance. I am confident we have a unique platform to unlock revenue synergies and generate good longer term growth”

Robin Watson, Chief Executive

Year ended 31 December Reported 2017
$m
Reported 2016
$m
%
Movement
Proforma 2017
$m1
Proforma 2016
$m1
%
Movement
Total Revenue2 6,169 4,934 25.0% 9,882 11,235 (12.0)%
Total EBITA2 372 363 2.5% 598 673 (11.1)%
EBITA Margin 6.0% 7.4% (1.4)% 6.0% 6.0% 0.0%
Revenue from continuing operations on an equity accounting basis 5,394 4,121 30.9%
Operating Profit before exceptional items 212 244 (13.1)%
(Loss)/profit for the period (30.0) 34.4 (187)%
Basic EPS (7.4)c 7.5c (199)%
Adjusted diluted EPS3 53.3c 64.1c (16.8)%
Total Dividend 34.3c 33.3c 3.0%
Net debt (excluding JV’s) 1,646.1 322.6

·      Financial results for 2017 ahead of guidance on a reported basis and in line on a  proforma basis

·      Relatively resilient performance despite continued challenging conditions in core oil & gas markets

·      Integration progressing at pace. Annualised cost synergies delivery of greater than $40m to date, earlier than plan. Remain confident of delivering at least $170m in three years

·      Net debt of $1.65bn and 12 month proforma Net debt : EBITDA of 2.4x

·      Deleveraging plan underpinned by confidence in earnings quality, synergies delivery and planned disposal of non core assets of at least $200m

·      Progressive dividend retained. Proposed final dividend of 23.2c up 3%

·      Proforma results in 2017 establish the base for Wood going forward and benefit from a dispute settlement in legacy AFW, partially offset by cost overruns on certain fixed price, non-oil and gas contracts

·      Operating profit before exceptional items is stated after non cash amortisation charges of $141m, including $32m of amortisation of intangibles arising on the acquisition of AFW

·      Loss for the period is stated after exceptional costs of $165m, including $67m in respect of the acquisition of Amec Foster Wheeler and restructuring & integration costs of $51m

·      Anticipate modest EBITA growth in 2018 reflecting early stage recovery in certain oil & gas markets, good momentum in broader energy and industrial contract awards and delivery of cost synergies

Notes:

1    Proforma results are unaudited. They include 12 months of AFW’s results but exclude the results of businesses disposed; principally the AFW North Sea upstream business, the AFW North American nuclear operations and the disposed elements of GPG. It also excludes the results of other, less material disposed interests including the Aquenta consultancy, an interest in Incheon Bridge and interests in two Italian windfarms.

2    See detailed footnotes following the Financial Review.  Total Revenue and Total EBITA are presented based on proportionally consolidated numbers, which is the basis used by management to run the business and includes the contribution from joint ventures. A reconciliation to statutory numbers is provided in note 1 to the accounts.

3    Company compiled publicly available consensus 2017 Reported EBITA on a proportionally consolidated basis is $345mm and AEPS is 50.5c. Consensus 2017 EBITA on a Profroma basis is $597m.

(https://www.woodplc.com/investors/analyst-consensus-and-coverage)

Wood is a global leader in the delivery of project, engineering and technical services to energy and industrial markets. We operate in more than 60 countries, employing around 55,000 people, with revenues of around $10 billion.  We provide performance-driven solutions throughout the asset life-cycle, from concept to decommissioning across a broad range of industrial markets including the upstream, midstream and downstream oil & gas, power & process, environment and infrastructure, clean energy, mining, nuclear and general industrial sectors. http://www.woodplc.com/

For further information contact:

Wood

Andrew Rose – Group Head of Investor Relations                                               01224 532 716
Ellie Dixon – Investor Relations Senior Manager                                                  01224 851 369

Brunswick
Patrick Handley                                                                                                 020 7404 5959
Charles Pemberton

There will be an analyst and investor presentation at the Lincoln Centre, 18 Lincoln’s Inn Fields, WC2A 3ED at 09.00.  Early registration is advised from 08.30.

A live webcast of the presentation will be available from https://www.woodplc.com/investors/financial-events-calendar

Replay facilities will be available later in the day.

Chair’s statement

2017 was a year of significant development for Wood Group culminating in the completion of the acquisition of Amec Foster Wheeler (“AFW”) on 6 October to create Wood, a global leader in the delivery of project, engineering and technical services to energy and industrial markets.

Wood Group has a long and successful track record of acquisition-led growth. In 2016 AFW was identified as a larger potential acquisition that could accelerate the Wood Group strategy to improve its service offering in project delivery, enhance its capability across the value chain in core oil and gas markets, and broaden and deepen end market and customer exposure.

The first quarter of 2017 presented an opportunity to acquire AFW at an appropriate valuation. The Board recognised the compelling rationale for substantial cost synergies and incremental revenue synergies in a less cyclically volatile business with a similar business model and strong operational capability. The all share offer announced on 13 March represented a 15% premium to the previous day’s closing price and received the overwhelming support of both sets of shareholders on 15 June with over 99% voting in favour. Since completion on 6 October, Robin and his combined leadership team have been focussed on integration, making good use of the lessons learned from Wood Group’s successful 2016 organisational change programme and proven track record of cost reduction.

The transaction did not divert management’s attention from operational delivery, which remained very much in focus throughout the year. The flexibility of our asset light business model has been crucial during the downturn in the oil & gas market. Wood Group’s focus on cost and managing utilisation continued throughout 2017. Capital discipline remained high on the agenda for E&P operators despite some recovery in commodity prices in the second half of the year. Going forward, Wood will have a broader exposure across energy and industrial markets and the oil and gas segment will account for around half of revenue.

Post completion, three former AFW directors joined the Board.  Roy Franklin is now the Senior Independent Director and Deputy Chair and Linda Adamany and Ian McHoul serve as non-executive directors. In January, Richard Howson stepped down from the Board. These board changes ensure diversity at Board level in terms of background, experience and thought leadership.

Taking account of cashflows and earnings, the progressive Wood dividend policy is a key element of our investment case and compares favourably against peers in the global engineering and construction sector. The Board has recommended a final dividend of 23.2 cents per share, which makes a total distribution for the year of 34.3 cents, an increase of 3% on the 2016 total distribution. Former AFW shareholders will also receive the final dividend.

Looking ahead, the Board is very confident that Wood will build on the integrated growth platform of Wood Group and Amec Foster Wheeler for the long term benefit of all stakeholders.

Ian Marchant, Chair

Chief Executive Review

Creating Wood, a global leader in project, engineering and technical services delivery

The acquisition of AFW in October 2017 brought together three brands and two companies to create one leading business in project, engineering and technical services delivery. We are a business of significantly increased scale with around 55,000 people in over 60 countries providing solutions across the asset life cycle from concept to decommissioning. We have a stronger, more balanced oil & gas offering and we are a much broader business, with a multi-sector, full service capability across energy and industrial markets.

In the first few months since completion, we have completed detailed business unit reviews that have confirmed the strategic rationale for the deal, the depth of capability in AFW and the unique growth opportunities for the combined business.

The Wood operating model was in place and communicated on Day 1, greatly benefitting our stakeholders’ understanding of the combined business and enabling our integration process to begin at pace. Wood Group completed a service defined organisational change programme in 2016 that focussed on simplicity and efficiency, resulting in a structure that could accommodate future business additions. As a result, the integration of AFW requires only minor modification to our operating and reporting model. Our 2016 reorganisation was key to the delivery of cumulative overhead costs savings of over $240m by the end of 2016, during the prolonged downturn in the oil & gas sector. We are confident this experience will enable us to deliver a leaner, more competitive combined organisation and underpin the delivery of cost synergies.

Integration and the achievement of synergies has been a key objective for the whole business.  We remain very confident of delivering annualised cost synergies at least $170m by the end of the third year following completion and are currently ahead of schedule. Our actions to date have been focussed on rationalisation at the top levels of management and the initial stages of property rationalisation. Key leadership was in place on Day 1 and we have subsequently announced a further two levels of organisation. We are taking a “Best of Both” approach to ensure retention of key experience and expertise in the combined business. To date we have delivered annualised cost synergies of greater than $40m. Costs to deliver synergies of c. $30m, including redundancy, restructuring and integration costs are recognised in exceptional items and are tracking in line with expectations.

Wood is better placed to serve customers than ever before, with a more comprehensive range of capabilities and the potential to deliver efficient integrated solutions with fewer customer interfaces. Customer reaction to the deal, particularly across oil & gas, has been positive. We have had some early successes on revenue synergies, including our recently announced contract with Saudi Aramco to support their integrated crude oils to chemicals complex.  We have also made good progress on merging bidding pipelines and aligning tendering and project delivery governance. The strategy and development function is leading the revenue synergies programme with an initial focus on educating leaders about the broader range of Wood capabilities on offer and identifying opportunities where we have a combination of capability that addresses an identified customer need. Examples include extending our involvement in oil & gas projects from the start of the asset life cycle to the end, leveraging our operations services experience into new industry sectors served by the legacy AFW business and building on our sector agnostic service offerings across the broader customer base.

The restrictions on interaction with AFW imposed by the offer period prevented us from deepening our understanding of the well flagged opportunities and risks until the transaction closed.  Following completion, David Kemp and I led comprehensive reviews into the acquired business units.  These reviews are now complete. Recognising the change in risk profile in the combined business, a key element of this process was a focus on significant contracts with profit at risk. The risk profile inherited is in line with our expectations and we have identified opportunities to simplify the process around how risk is managed. We have already enhanced our governance structures, project and tender review and contracting policy as a result. We have also taken the decision not to pursue certain high risk lump sum work which was problematic in the legacy AFW business.

Deleveraging to within our preferred range of 0.5 to 1.5x net debt to EBITDA within approximately 18 months post completion is a key priority and we remain confident in the underlying quality of earnings and cash conversion in the business to achieve this target. Our target range reflects our long standing preference for a strong balance sheet foundation. The key elements of our deleveraging plan include; improved working capital management, delivering cost synergies, capital discipline and disposing of non-core businesses including the potential disposal of EthosEnergy.  We anticipate proceeds from all such non-core disposals to exceed $200m in the next 18 months.

In terms of our combined safety performance, we now have almost 200 million man-hours of annual exposure. Our initial assessment is that the businesses share common areas of focus and the impact on lagging indicators is minimal. Our ‘Stand Up for Safety’ programme continues to be implemented and will be the cornerstone of the Wood safety engagement through 2018 and beyond. Our general safety performance has encouraging improvements, with total recordable case frequency (TRCF) and lost work case frequency (LWCF) down 8% and 17% respectively compared to 2016 on a proforma basis.  Regrettably, there were two fatalities in the legacy AFW business in 2017, both vehicle related.  Our focus on safety as our top priority is undiminished.

Details of certain investigations in the UK and US and in respect of certain litigation in the US, that have previously been disclosed, are included in the contingent liabilities and provisions note to the accounts. Wood continues to cooperate with and assist the relevant authorities including the SFO in relation to their respective investigations into the historical use of agents and in relation to Unaoil.

Financial performance in 2017

Year ended 31 December Reported 2017
$m
Reported 2016
$m
%
Movement
Proforma 2017
$m1
Proforma 2016
$m1
%
Movement
Total Revenue2 6,169 4,934 25.0% 9,882 11,235 (12.0)%
Total EBITA2 372 363 2.5% 598 673 (11.1)%
EBITA Margin 6.0% 7.4% (1.4)% 6.0% 6.0% 0.0%
Revenue from continuing operations on an equity accounting basis 5,394 4,121 30.9%
Operating Profit before exceptional items 212 244 (13.1)%
(Loss)/profit for the period (30.0) 34.4 (187)%
Basic EPS (7.4)c 7.5c (199)%
Adjusted diluted EPS3 53.3c 64.1c (16.8)%
Total Dividend 34.3c 33.3c 3.0%
Net debt (excluding JV’s) 1,646.1 322.6

We outlined our approach to financial metrics and reporting in November ahead of the first Wood trading update in December.  There is no change to our proportionally consolidated approach to running and reporting the business which includes the contribution from joint ventures.  Total EBITA and Adjusted diluted EPS are retained as our principal profit measures and EBITA is stated after costs relating to asbestos litigation and claims.

Financial results for 2017 are ahead of guidance on a reported basis and in line on a proforma basis.

Reported full year actual results comprise the legacy Wood Group business and a contribution from AFW for the period from completion on 6 October 2017 to 31 December 2017.

Results are also presented on a Proforma basis to provide better insight into the continuing business and establish the base level for Wood for comparability going forward. Proforma results include 12 months of AFW’s results but exclude the results of businesses disposed; principally the AFW North Sea upstream business, the AFW North American nuclear operations and the disposed elements of GPG. They also exclude the results of other, less material disposed interests including the Aquenta consultancy, an interest in Incheon Bridge and interests in two Italian windfarms.

In the legacy Wood Group business, results reflect relatively resilient performance in a challenging oil & gas market.  In AS Americas, EBITA was down on 2016. Revenues were broadly in line with 2016, but margins fell due to the completion of onshore engineering projects in 2016, only partly offset by increased activity in offshore engineering. In AS EAAA revenue was down on 2016 but with a stronger second half as expected. We continued to make good progress on overhead reduction and saw some moderation in pricing pressure, although EBITA margin reduced in part due to the positive one off impact of commercial close out on significant and legacy projects in 2016 of around $15m. In STS we saw good growth in automation revenue and robust activity in technology related work, offset by lower activity in subsea & export systems. EBITA margin reduced, in part due to the positive one off impact of commercial close out on significant and legacy projects in 2016, and lower margins in subsea.

In terms of the underlying trading in the legacy AFW business, a number of themes highlighted in their half year results have been evident in our review of the business post completion. From a financial perspective, in the second half the receipt of a dispute settlement was partly offset by delays and cost overruns on certain fixed price non-oil and gas contracts.

Operating profit before exceptional items is stated after non cash amortisation charges of $141m (2016:$104m) which includes $32m in respect of amortisation of intangibles arising on the acquisition of AFW.

The loss for the period of $30m is stated after exceptional costs of $165m net of tax. This included $67m in respect of costs relating to the acquisition of Amec Foster Wheeler, comprising advisory fees of $59m and underwriting fees in respect of new debt facilities of $8m. Also included are restructuring, redundancy & integration costs of $51m. We also made a provision for $19m in the first half in relation to an ongoing subcontractor dispute on a legacy turbines contract which was substantially completed prior to the formation of EthosEnergy. Also included in exceptional costs is a further impairment in the carrying value of EthosEnergy of $28m and other exceptional costs relating to EthosEnergy of c. $10m, mainly related to impairment of receivables.

Net Debt at the year end was $1.65bn and net debt to 12 month proforma EBITDA was 2.4x. This compares to net debt at completion of $2.0bn, which was in line with our expectations. Since completion, the disposal of the AFW UK upstream business on 27 October reduced net debt by c. $250m, although this was partly offset by expected transaction and synergy delivery costs that sit below the EBITA line.  Cash conversion was 69% reflecting improved working capital performance offset in part by the cash impact of exceptional items including costs related to the AFW acquisition and integration.  Cash conversion before exceptional items was 90%.

Outlook

We entered 2017 as a business engaged in the design, modification, construction and operation of facilities mainly in the upstream oil & gas sector with a clear strategy to broaden into adjacent industries. We are now well positioned as a global leader in project, engineering and technical services delivery. We are a broader business with multi-sector, full service capability across energy and industrial markets and a more balanced offering in oil & gas.

Following completion of the AFW transaction, our business unit reviews confirmed the strategic rationale for the deal, the depth of capability in AFW and the unique growth opportunities for the combined business. At this early stage we currently anticipate modest EBITA growth in 2018.  This compares to 2017 proforma EBITA, which includes the one-off benefit of a dispute settlement in legacy AFW. Expected EBITA growth reflects early stage recovery in certain areas of our core oil & gas market and benefit from the delivery of cost synergies. We have also seen good momentum in contract awards more generally in broader energy and industrial markets in the second half of 2017.

Looking further ahead, we have a unique platform to unlock revenue synergies and generate good longer term growth. Our financial objectives and focus are clear; to reduce net debt to EBITDA to below 1.5x within approximately 18 months, to retain our progressive dividend policy taking into account cashflows and earnings and to deliver cost synergies by year 3 of at least $170m in line with our previous commitment.

Asset Solutions Americas

Reported Proforma
FY 2017
$m
FY 2016 $m Change (%) FY 2017 $m FY 2016 $m Change (%)
Total Revenue 2,387 2,115 12.9% 3,186 4,219 (24.5)%
Total EBITA 158 176 (10.2)% 165 225 (26.7)%
EBITA Margin 6.6% 8.3% (1.7)% 5.2% 5.3% (0.1)%
People 16,800 10,900 54.1% 16,800 16,000 5.0%

The AFW acquisition provided AS Americas with a multi-sector engineering, procurement and construction capability predominantly focused on the Power & Process industries and an enhanced capability in the Downstream & Chemicals market.  The business unit retains its leading upstream oil & gas engineering activity, offshore operations services and onshore construction & maintenance offering and now has a more balanced multi sector exposure with an enhanced EPC and project management offering.

Reported results in 2017 include revenue of c$370m from the Power & Process and Downstream & Chemicals businesses of AFW in the period from completion on 6 October to 31 December, which included activity on US solar projects.

Proforma results are included to provide insight into the underlying business and include a full year contribution from the AFW activities acquired, together with the comparative figures for 2016. Performance in downstream & chemicals improved in 2017.  Activity in power & process reduced following the step up in solar projects that arose in 2016 in response to the anticipated end of US solar investment incentives and activity in downstream and chemicals reduced.

Performance in the legacy Wood Group business was down on 2016. Revenues were broadly in line, but margins fell due to the completion of onshore engineering projects in 2016, only partly offset by increased activity in offshore engineering.

Activity on offshore greenfield capital projects including Husky White Rose, Peregrino, Leviathan and Mad Dog 2 partly offset reduced onshore engineering work following completion of a number of projects in 2016 including Flint Hills and the ETC Dakota access pipeline. In US shale, increased drilling activity has led to a modest improvement in demand for our construction and infrastructure activities and performance is up on 2016. Operations Services work remained relatively robust despite challenging conditions in the Gulf of Mexico and onshore markets. We saw increased activity in Newfoundland on the Hibernia Platform and on our Hebron hook up and commissioning scope which completed in the second half of 2017.  We remain active on downstream and non-oil and gas projects including our maintenance scope on the Sweeny refinery in Texas for Phillips 66 and our onshore civil works and infrastructure projects with Sofidel in Ohio.

Outlook

We have retained our market share in the offshore greenfield market, although visibility on projects beyond existing work remains low and pricing remains under pressure.  Activity in downstream & chemicals capital projects is expected to increase as work secured on contracts including the c$600m methanol plant YCI EPC scope ramps up from a slow start. We have good visibility on EPC projects in the power and process sectors. The improvement in shale activity is expected to continue with activity focused on the Niobrara and Permian basins where we are increasing headcount. In operations services we expect the challenging market conditions to continue into 2018. The delivery of significant cost synergies will be a key area of focus in 2018 and these are progressing ahead of plan.

Asset Solutions Europe, Africa, Asia and Australia

Reported Proforma
FY 2017 $m FY 2016 $m Change (%) FY 2017 $m FY 2016 $m Change (%)
Total Revenue 2,617 2,331 12.3% 3,723 4,016 (7.3)%
Total EBITA 140 143 (2.1)% 283 350 (19.1)%
EBITA Margin 5.3% 6.1% (0.8)% 7.6% 8.7% (1.1)%
People 25,700 15,300 68% 25,700 29,800 (13.8)%

The AFW acquisition provided AS EAAA with a leading project engineering and delivery capability in oil & gas. The business unit retains its leading upstream operations services offering and now has a more balanced exposure across upstream and downstream, a proven track record in EPC and project management and an established high value engineering centre.

Reported results in 2017 include revenue of c$500m from the oil, gas & chemicals project engineering business of AFW in the period from completion on 6 October to 31 December, which included activity on Shah Deniz for BP, the Antwerp oil refinery for Exxon Mobil and the project management consultancy contract for the Al-Zour chemicals plant with Kuwait Oil Company.

Proforma results are included to provide insight into the underlying business and include a full year contribution from the AFW activities acquired, together with the comparative figures for 2016. Proforma performance in 2017 includes the one off settlement received by AFW, related to a dispute settlement on certain oil & gas projects. In 2016 pro-forma EBITA benefitted from significant provision releases in the legacy AFW business.

In the legacy Wood Group business unit, although revenue was down on 2016, EBITA in 2016 was supported in part by the positive one off impact of commercial close out on significant and legacy projects of around $15m.   Second half performance was stronger than H1 as expected, as we continued to make good progress on overhead reduction and saw some moderation in pricing pressure,

Operations Services work was the largest contributor to revenue and earnings in 2017 and included improved performance in the Middle East and Asia Pacific. Our contract with Exxon in Iraq is progressing well and in Asia Pacific, activity levels on our Exxon contract in Papua New Guinea are increasing and we remain active on projects including our expanded scope with Melbourne Water. We also commenced work on our five year managed services scope from Hess Malaysia for their offshore facilities in the North Malay basin. In Saudi Arabia, work under the GES+ contract with Aramco was released at a slower than expected rate. In Europe, we retain a market leading position in the challenging North Sea Market where we saw a significant fall in revenue and earnings with reduced workscopes and lower volumes of minor modifications work. Our differentiated offering continues to position us well with new entrants, building on the success of our work on CATS with Antin and Ancala’s midstream assets. We also secured our first onshore downstream workscope supporting the Lindsey oil refinery for Total for 5 years. Our industrial services business performed broadly in line with the prior year.  In projects and modifications, we have seen a significant reduction in modifications and upgrade work, with the most material reductions in the North Sea and Kazakhstan.

Turbine joint ventures were up on 2016, with RWG performing robustly and improved performance in EthosEnergy.  The impairment of EthosEnergy in 2017 reflects the latest expectation of sales price less costs to sell, based on anticipated longer term prospects.

Outlook

Looking ahead, we see good underlying growth in AS EAAA in 2018.  In Operations Services we see a positive outlook from a low base in the North Sea, a relatively robust outlook for Asia, the Middle East and Australasia and see downstream opportunities in the Middle East and mainland Europe. The delivery of significant cost synergies will be a key area of focus in 2018 and these are progressing ahead of plan.  Capital projects are expected to account for c.40% of revenues. Due to the phasing of activity on secured work and the one off benefit in 2017 on certain oil and gas projects, reported performance in Capital Projects will likely be lower in 2018, although we have good visibility of work including the FEED and project management consultancy scope for Aramco on both the Marjan field and the integrated crude oils to chemicals complex.

Specialist Technical Solutions

Reported Proforma
FY 2017 $m FY 2016 $m Change (%) FY 2017 $m FY 2016 $m Change (%)
Total Revenue 756 488 54.9% 1,320 1,240 6.4%
Total EBITA 82 79 3.8% 134 147 (8.8)%
EBITA Margin 10.8% 16.2% (5.4)% 10.1% 11.8% (1.7)%
People 7,600 2,800 171.4% 7,600 6,600 15.1%

The scale, breadth of end market exposure and technical capability within STS have been greatly enhanced by the AFW acquisition.  Reported results in 2017 include revenue of c. $180m from the Mining & Minerals, Nuclear and Process Technology activities of AFW in the period from completion on 6 October to 31 December. Proforma results are included to provide insight into the underlying business and include a full year contribution from the AFW activities acquired, together with the comparative figures for 2016.

In 2017 we saw good growth in automation revenue and robust activity in technology related work, offset by lower activity in subsea & export systems in the legacy Wood Group business. EBITA margin reduced in part due to the positive one off impact of commercial close out on significant and legacy projects in 2016 and lower margins in subsea.

Growth in automation was led by increased procurement activity on the Tengiz expansion project for TCO and the contribution of CEC in Detroit acquired in May, which enhanced our industrial process & control capabilities in the automotive sector. Technology related activity including asset integrity solutions and clean energy performed relatively robustly. Activity in subsea reduced with available workscopes in the market generally limited to small projects, brownfield or early stage work.

Outlook

Benefitting from the increase in commodity prices, our consulting and project delivery work in Mining & Minerals has a positive outlook and will be our largest contributor to STS revenue in 2018 with good visibility on projects including the c. $150m Gruyere Gold EPC work in Australia. Our nuclear business is well positioned in the UK and we expect it to continue to perform robustly. In automation we are seeing early signs of improvement in some downstream and refining markets and we have strong visibility on the TCO project beyond 2018. In the subsea market, some positive sentiment is returning but with opportunities more focussed on brownfield and operations scopes.

Environment and Infrastructure Solutions

Reported Proforma
FY 2017 $m FY 2016 $m Change (%) FY 2017 $m FY 2016 $m Change (%)
Total Revenue 321 n/a n/a 1,279 1,252 2.2%
Total EBITA 25 n/a n/a 72 40 80.0%
EBITA Margin 7.8% n/a n/a 5.6% 3.2% 2.4%
People 7,300 n/a n/a 7,300 7,100 2.8%

The AFW acquisition provided Wood with a leading environmental remediation consultancy and engineering & construction project management capability across a broad range of sectors including government, transport, water, mining and oil & gas.

Reported results in 2017 reflect results of AFW’s environment & infrastructure solutions business in the period from completion on 6 October to 31 December.  Proforma results are included to provide insight into the underlying business.

2017 revenues in the E&IS business were in line with 2016 due to growth in government and mining sectors and good execution on pharmaceutical projects.  This is offset by a reduction in oil and gas projects, particularly in North America as challenging conditions continue and the completion of a land remediation project management scope at the end of 2016. In 2016 EBITA was impacted by significant cost overruns on a fixed price, non-oil and gas, US government capital project in the Pacific.  EBITA in 2017 also includes the impact of overruns on a fixed price contract with the US government but to a lesser extent.  Undertaking contracts of this specific nature will not be part of our strategy going forward due to inherent cash flow challenges.

Outlook

We expect further growth in 2018. Government represents the largest sector for our E&IS business and we are well positioned to benefit from increased environmental and infrastructure investment, particularly in the US.  In Europe we will also benefit from EPCM work for GlaxoSmithKline in Germany secured in the second half.  Due to the multi-sector nature of our capabilities in E&IS we see strong opportunities for revenue synergies across complementary sectors in our Asset Solutions and Specialist Technical Solutions businesses.

Investment Services

A number of potentially non-core legacy activities in AFW are managed in Investment Services. This includes the activities of the Transmission and Distribution business and the Industrial Power and Machinery business in addition to interests in a number of infrastructure projects. Investment services generated proforma revenues of $374m in 2017 (2016: $508m) and EBITA of $28m (2016: $4m).


 

Financial Review

Trading performance

Reported full year trading performance comprises the heritage Wood Group business and the contribution from AFW for the period from completion on 6 October 2017 to 31 December 2017.

There is no change to our proportionally consolidated approach to running and reporting the business which includes the contribution from joint ventures.  Total EBITA and Adjusted diluted EPS are retained as our principal profit measures and EBITA is stated after costs relating to asbestos.

A reconciliation to statutory measures of revenue and operating profit from continuing operations excluding joint ventures is included in note 1 to the financial statements.

Full Year
2017
$m
Full Year
 2016
$m
4
Total Revenue 6,169.0 4,934.0
Total EBITA 371.6 363.4
EBITA margin % 6.0% 7.4%
Amortisation - software and system development (61.3) (54.4)
Amortisation - intangible assets from acquisitions (80.0) (49.9)

EBIT

230.3

259.1
Net finance expense (excluding exceptional items) (52.9) (25.8)
Profit before tax, exceptional and discontinued items 177.4 233.3
Taxation before exceptional items
 
(42.3) (59.1)
Profit before exceptional items 135.1 174.2
Exceptional items, net of tax (165.1) (139.8)
(Loss)/profit for the period (30.0) 34.4
Basic  EPS (cents) (7.4)c 7.5c
Adjusted diluted  EPS (cents) 53.3c 64.1c

The review of our trading performance is contained within the Chief Executive Review.


 

Reconciliation to operating profit

The table below sets out a reconciliation of Total EBITA to operating profit per the group income statement before exceptional items. Operating profit on a post exceptional basis by segment is included in note 1 to the financial statements.


2017
$m

2016
$m

Total EBITA

371.6

363.4
Amortisation (141.3) (104.3)
EBIT 230.3 259.1
Tax and interest charges on joint ventures included within operating profit but not in Total EBITA
(17.9)

(15.4)

Operating profit before exceptional items

212.4

243.7

Pro-forma Revenue and EBITA

The financial performance of the Group for 2017 and 2016 on a pro-foma basis is presented below. Pro-forma results are unaudited and are included to provide better insight into the underlying, continuing business performance and establish the base level for Wood for comparability going forward.

They include 12 months of AFW’s results but exclude the results of businesses disposed; principally the AFW North Sea upstream business, the AFW North American nuclear operations and the disposed elements of GPG. They also excludes the results of other, less material disposed interests including the Aquenta consultancy, an interest in Incheon Bridge and interests in two Italian windfarms.

Unaudited 2017
Total Revenue
$m
 2017
Total EBITA
$m
 2016
Total Revenue
$m
 2016
Total EBITA
$m
Asset Solutions Americas 3,186.5 164.9 4,219.0 225.0
Asset Solutions EAAA 3,722.7 283.5 4,016.0 350.0
Specialist Technical Solutions 1,320.0 133.8 1,240.0 147.0
Environment and Infrastructure Solutions 1,279.0 71.9 1,252.0 40.0
Investment Services 373.6 27.9 508.0 4.0

Centre (incl asbestos)

-

(84.3)

-

(93.0)
Pro forma 9,881.8 597.7 11,235.0 673.0
EBITA margin 6.0% 6.0%

Accounting for the acquisition of Amec Foster Wheeler

Wood Group acquired Amec Foster Wheeler (‘AFW’) by issuing 294.5m new shares. Total consideration amounted to $2,809.4m based on the closing share price and the US dollar exchange rate on that date. Goodwill of $3,514.5m and intangible assets of $1,343.6m were recognised on the transaction. The intangible assets include customer relationships, order backlog and brands and will be amortised over periods of between 2 and 20 years. Amortisation of $32.0m is included in the 2017 results with the annual charge for 2018 expected to be around $129m. Subsequent to completion of the acquisition, a detailed review of the acquired AFW balance sheet was carried out and a number of opening balance sheet and fair value adjustments were identified.   These totalled $211m and net assets at date of acquisition have been adjusted and had the effect of increasing the amount of goodwill recognised on the acquisition.

Amortisation

Total amortisation for 2017 of $141.3m (2016: $104.3m) includes $32.0m for AFW as mentioned above and $48.0m of amortisation relating to intangible assets arising from prior year acquisitions. Amortisation in respect of software and development costs was $61.3m (2016: $54.4m) and this largely relates to engineering software and ERP system development. Included in the amortisation charge for the year above is $1.9m (2016: $2.0m) in respect of joint ventures.

Net finance expense and debt

Net finance expense is analysed below.

Full year
2017
$m
Full year
 2016
$m
Interest on debt 20.8 4.8
Interest on US Private Placement debt 14.1 14.1
Finance expense relating to defined benefit pension schemes 2.6 -
Unwinding of discount relating to asbestos and deferred consideration 6.3 2.6
Other interest, fees and charges 11.9 6.5
Total finance expense pre-exceptional items 55.7 28.0
Finance income relating to defined benefit pension schemes - (0.2)
Other finance income (2.8) (2.0)
Net finance expense pre-exceptional items 52.9 25.8

Interest cover4 was 7.0 times (2016: 14.1 times).

Included in the above are net finance charges of $3.4m (2016: $2.4m) in respect of joint ventures.

Finance costs of $8.5m relating to the acquisition of AFW have been treated as ‘exceptional items’ and are excluded from the above analysis.

The Group negotiated new bank facilities in order to complete the acquisition of AFW. The facilities comprised a $1bn term loan repayable in 2020 and a 5 year Revolving Credit Facility of $1.75bn repayable in 2022. At 31 December 2017 total borrowings under these facilities amounted to $1,961.1m with $692.0m undrawn. A further $143.5m of overdraft funding is available under the Group’s other short term facilities.

Net debt to pro-forma EBITDA at 31 December was 2.4 times (2016: 0.8 times) against our covenant of 3.5 times. The Group’s target is to reduce the net debt to EBITDA ratio to below 1.5 times within 18 months.

Exceptional items

Full Year
 2017
 $m
Full year
 2016
$m
Acquisition costs 58.9 -
Redundancy, restructuring and integration costs
Arbitration settlement provision
51.4

19.2
65.9

-
EthosEnergy impairment and other write offs 38.3 89.0
Investigation support costs 8.2 -

176.0

154.9
Bank fees relating to AFW acquisition 8.5 -
184.5 154.9
Tax on exceptional items (19.4) (15.1)
Continuing exceptional items, net of tax 165.1 139.8

Acquisition costs of $58.9m have been incurred during the year in relation to the acquisition of Amec Foster Wheeler. These costs include broker and legal fees as well as other advisor and regulatory fees. In addition, $8.5m of bank fees have been expensed in respect of the new borrowing facility required to fund the acquisition.

Redundancy, restructuring and integration costs of $51.4m have been incurred during the year. The total includes $33.1m in respect of synergy delivery costs including $19.0m of redundancy and restructuring costs and $14.1m of other integration costs.  Also included is other redundancy and restructuring costs of $9.1m and costs relating to onerous property leases of $9.2m.

A charge of $19.2m has been recorded in relation to a legacy contract which was carried out by our Gas Turbine Services business prior to the formation of EthosEnergy. Arbitration hearings have been held in relation to a dispute between the Group and a former subcontractor and this amount represents our best estimate of the likely settlement including related legal costs. The outcome of the arbitration hearing is likely to be known in the first half of 2018.

Investigation support costs of $8.2m have been incurred during the period in relation to ongoing investigations into the historical use of agents and other third parties.

At 31 December 2017, the Group carried out an impairment review of its investment in the EthosEnergy joint venture. The recoverable amount of the investment, based on management’s estimate of fair value less costs of disposal, of $77.0m, is lower than the book value and an impairment charge of $28.0m has been booked in the income statement. In addition, EthosEnergy has recorded exceptional charges of $1.1m during the year relating to the closure of its power solutions business and the Group has impaired its receivables by $5.7m in relation to a balance due by EthosEnergy and booked a $3.5m charge in relation to a likely settlement of indirect taxes.

A tax credit of $19.4m has been recorded in respect of the exceptional items included in continuing operations.

Taxation

The effective tax rate on profit before tax, exceptional and discontinued items including joint ventures and discontinued operations on a proportionally consolidated basis is set out below.

Full year
2017
$m
Full year
 2016
$m
Profit from continuing operations before tax (pre-exceptional items) 177.4 233.3
Tax charge (pre-exceptional items) 42.3 59.1
Effective tax rate on continuing operations (pre-exceptional items) 23.8% 25.3%

The tax charge above includes $14.5m in relation to joint ventures (2016: $12.4m).

The Group has carried out an initial review of the US Tax and Jobs Act which came into force on 1 January 2018 and as a result has recorded a one-off non-cash credit of $8.5m to the income statement in 2017 as a result of the revaluation of net deferred tax liabilities. The cash impact of the reduction in the headline US federal rate to 21% is likely to be offset to some extent by greater restriction on the level of interest deduction allowed in the US also introduced by the Act. The rate reduction is expected to have a favourable on the Group’s effective tax rate going forward.

Earnings per share

Adjusted diluted EPS for the year was 53.3 cents per share (2016: 64.1 cents). The average number of fully diluted shares used in the EPS calculation for the period was 451.3m (2016: 382.9m).

Adjusted diluted EPS adds back all amortisation.  If only the amortisation related to intangible assets arising on acquisition is adjusted and no adjustment is made for that relating to software and development costs, the figure for 2017 would be 42.9 cents per share (2016: 53.5 cents). 

Reconciliation of number of fully diluted shares (million) Closing Weighted average
At start of year 381.0 381.0
Allocation of shares to employee share trusts 2.2 1.7
Shares issued to acquire AFW 294.5 67.0
677.7 449.7
Shares held by employee share trusts (9.1) (9.7)
Basic number of shares for EPS 668.6 440.0
Effect of dilutive shares 11.7 11.3
Fully diluted number of shares for EPS 680.3 451.3

Dividend

Taking account of cash flows and earnings, the progressive Wood dividend policy is a key element of our investment case and compares favourably against peers in the global engineering and construction sector. The Board has recommended a final dividend of 23.2 cents per share, which makes a total distribution for the year of 34.3 cents, an increase of 3%. The final dividend will be paid on 17 May 2018 to all shareholders on the register at the close of business on 20 April 2018.

Cash flow and net debt

The cash flow and net debt position below has been prepared using equity accounting for joint ventures, and as such does not proportionally consolidate the assets and liabilities of joint ventures.   The gross and net debt figures including joint ventures are given below.

Full year
 2017
$m
Full year
2016
$m
Opening net debt (excluding JV’s) (322.6) (293.9)
EBITDA 423.1 419.7
Less JV EBITDA (61.9) (60.3)
361.2 359.4
Exceptional items – cash impact (75.1) (25.1)
Decrease in provisions (75.8) (43.8)
Dividends from JV’s and other 55.7 35.0
Cash generated from operations pre-working capital 266.0 325.5
Working capital movements (16.0) (80.4)
Cash generated from operations 250.0 245.1
Acquisitions (1,469.3) (36.2)
Divestments 254.9 -
Capex and intangibles (79.1) (86.8)
Tax paid (99.6) (55.6)
Interest dividends and other (180.4) (95.2)
Increase in net debt (1,323.5) (28.7)
Closing net debt (excluding JV’s) (1,646.1) (322.6)

Cash generated from operations pre-working capital decreased by $59.5m to $266.0m and post-working capital increased by $4.9m to $250.0m as a result of improvements in working capital.

Cash conversion, calculated as cash generated from operations as a percentage of EBITDA, improved slightly to 69% (2016: 68%) due to improved working capital performance partly offset by the cash impact of exceptional costs, primarily related to the acquisition of Amec Foster Wheeler.  Excluding the impact of exceptional costs cash conversion is 90%.

The cash outflow in respect of acquisitions of $1,469.3m includes $1,385.4m in relation to the acquisition of Amec Foster Wheeler, $50.5m in respect of CEC and $33.4m in respect of companies acquired in prior periods.  The amount shown in respect of AFW relates to the net borrowings on its balance sheet at the date of acquisition.

Cash from divestments of $254.9m relates to the disposal of Amec Foster Wheeler’s UK upstream oil and gas business and the disposal of their North American nuclear and pulverised coal businesses.

Payments for capex and intangible assets were $79.1m (2016: $86.8m) and included software development and expenditure on ERP systems across the Group.

Summary Balance Sheet

The balance sheet below has been prepared using equity accounting for joint ventures, and as such does not proportionally consolidate the joint ventures assets and liabilities.

Dec
2017
$m
Dec
2016
$m
Non-current assets 8,025.5 2,450.0
Current assets 4,049.6  1,579.5
Current liabilities (3,243.5) (1,070.7)
Net current assets 806.1 508.8
Non-current liabilities (3,859.6) (750.6)
Net assets 4,972.0 2,208.2
Equity attributable to owners of the parent 4,960.3 2,195.2
Non-controlling interests 11.7 13.0
Total equity 4,972.0 2,208.2

Non-current assets include $6,870.8m (2016: $1,894.5m) of goodwill and intangible assets, $4,859.2m of which relates to the acquisition of Amec Foster Wheeler. The Group’s balance sheet has changed significantly as a result of the acquisition with significant increases in current assets, current liabilities and non-current liabilities. Long term borrowings have increased by $1.8bn as a result of the debt acquired and the shares issued to AFW shareholders to complete the transaction have resulted in an increase in equity of $2.8bn.

Asbestos related obligations

As a result of the acquisition of AFW, the Group  is subject to claims by individuals who allege that they have suffered personal injury from exposure to asbestos primarily in connection with equipment allegedly manufactured by certain subsidiaries during the 1970’s or earlier. The majority of the asbestos related liabilities arise as a result of Amec’s acquisition of Foster Wheeler in 2014. The overwhelming majority of claims that have been made and are expected to be made are in the United States. The table below shows the recent claims history for former Foster Wheeler entities.

Number of US claims 2017 2016
Open claims at start of year 81,720 110,130
New claims received 3,200 3,800
Claims resolved (14,800) (32,210)
Open claims at end of year 70,120 81,720

The following table summarises the total approximate US asbestos related net cash impact for indemnity and defence cost payments and collection of insurance proceeds:

2017 2016
$m $m
Asbestos litigation, defence and case resolution payments 50.6 46.0
Insurance proceeds (16.4) (17.2)
Net asbestos related payments 34.2 28.8

The Group expects to have net cash outflows of $35.9m as a result of asbestos liability indemnity and defence payments in excess of insurance proceeds during 2018. The estimate assumes no additional settlements with insurance companies and no elections to fund additional payments. The Group has worked with its independent asbestos valuation experts to estimate the amount of asbestos related indemnity and defence costs at each year end based on a forecast to 2050.

The Group’s EBITA is stated after deducting costs relating to asbestos including administration costs, movements in the liability as a result of changes in assumptions and changes in the discount rate.

Pensions

The Group operates a number of defined benefit pension schemes in the UK and US and a number of defined contribution plans. At 31 December 2017, the schemes had a net surplus of $167.7m (2016: deficit $7.0m). The movement in the year is largely due to the addition of a number of defined benefit schemes as a result of the AFW acquisition. In assessing the potential liabilities, judgment is required to determine the assumptions around inflation, investment returns and member longevity. The assumptions at 31 December 2017 showed a slight reduction in the discount rates (which results in higher scheme liabilities) and lower inflation rates (which results in lower scheme liabilities). Full details of pension assets and liabilities are provided in note 30 to the Group financial statements.

Acquisitions and divestments

In May 2017, the Group acquired 100% of the share capital of CEC Controls Inc (‘CEC’), a designer and builder of industrial and process control systems for the automotive manufacturing industry based in Detroit, USA.

On 6 October 2017, the Group acquired 100% of the share capital of Amec Foster Wheeler plc (‘AFW’) by issuing 0.75 Wood Group shares for each AFW share. The total value of the consideration was $2,809.4m. In addition, the Group acquired AFW net debt amounting to $1,385.4m.  The acquisition of Amec Foster Wheeler accelerates Wood Group’s strategy to improve its service offering in project delivery, enhance its capability across the value chain in core oil and gas markets, and broaden and deepen end market and customer exposure.

On 27 October 2017, the Group disposed of Amec Foster Wheeler’s UK upstream oil and gas business for a gross consideration of $299.0m. This divestment was one of the conditions agreed with the competition authorities to enable the Group to proceed with the Amec Foster Wheeler acquisition. On 6 November 2017, the Group disposed of Amec Foster Wheeler’s North American nuclear operations for a gross consideration of $8.9m and on 1 December, the disposal of its pulverised coal business was completed for a gross consideration of $5.2m.

Footnotes

1 Total EBITA represents operating profit including JVs on a proportional basis of $54.3m (2016: $104.2m) before the deduction of amortisation of $141.3m (2016: $104.2m) and continuing exceptional expense of $176.0m (2016: $154.9m) and is provided as it is a key unit of measurement used by the Group in the management of its business.

2 Adjusted diluted earnings per share (“AEPS”) is calculated by dividing earnings before exceptional items and amortisation, net of tax, by the weighted average number of ordinary shares in issue during the period, excluding shares held by the Group's employee share ownership trusts and adjusted to assume conversion of all potentially dilutive ordinary shares.

3 Number of people includes both employees and contractors at 31 December 2017 and includes joint ventures.

4 Interest cover is reported EBITA divided by the net finance expense.


Consolidated income statement
for the year to 31 December 2017

2017 2016
Pre-
Exceptional
Items
Exceptional
Items
(note 4)


Total
Pre-
Exceptional
Items
Exceptional
Items
(note 4)


Total
Note $m $m $m $m $m $m

Revenue from continuing operations

1

5,394.4

-

5,394.4

4,120.6

-

4,120.6
Cost of  sales (4,714.4) - (4,714.4) (3,498.2) - (3,498.2)
Gross profit 680.0 - 680.0 622.4 - 622.4
Administrative expenses 4 (500.0) (146.9) (646.9) (411.4) (68.3) (479.7)
Impairment of investment in joint ventures 4,10 - (28.0) (28.0) - (56.7) (56.7)
Share of post-tax profit from joint ventures 4,10 32.4 (1.1) 31.3 32.7 (29.3) 3.4
Operating profit 1 212.4 (176.0) 36.4 243.7 (154.3) 89.4
Finance income 2 2.8 - 2.8 2.2 - 2.2
Finance expense 2 (52.3) (8.5) (60.8) (25.6) - (25.6)
Profit/(loss) before taxation from continuing operations 3,4 162.9 (184.5) (21.6) 220.3 (154.3) 66.0
Taxation 4,5 (27.8) 19.4 (8.4) (46.1) 14.5 (31.6)
Profit/(loss) for the year from continuing operations 135.1 (165.1) (30.0) 174.2 (139.8) 34.4
Profit/(loss) attributable to:
Owners of the parent 132.7 (165.1) (32.4) 167.6 (139.8) 27.8
Non-controlling interests 26 2.4 - 2.4 6.6 - 6.6
135.1 (165.1) (30.0) 174.2 (139.8) 34.4
Earnings per share (expressed in cents per share)
Basic 7 (7.4) 7.5
Diluted 7 (7.4) 7.3

The notes on pages 7 to 82 are an integral part of these consolidated financial statements.


Consolidated statement of comprehensive income/expense
for the year to 31 December 2017


2017

2016
Note $m $m
(Loss)/profit for the year (30.0) 34.4

Other comprehensive (expense)/income
Items that will not be reclassified to profit or loss
Re-measurement losses on retirement benefit scheme 30 (1.2) (14.2)
Movement in deferred tax relating to retirement benefit scheme 5 0.7 2.8
Total items that will not be reclassified to profit or loss (0.5) (11.4)

Items that may be reclassified subsequently to profit or loss
Cash flow hedges 25 1.3 -
Exchange movements on retranslation of foreign currency net assets 25 119.2 (138.8)
Exchange movements on retranslation of non-controlling interests 26 - (0.3)
Total items that may be reclassified subsequently to profit or loss 120.5 (139.1)
Other comprehensive income/(expense) for the year, net of tax 120.0 (150.5)
Total comprehensive income/(expense) for the year 90.0 (116.1)

Total comprehensive income/(expense) for the year is attributable to:
Owners of the parent 87.6 (122.4)
Non-controlling interests 2.4 6.3
90.0 (116.1)

Total comprehensive income/(expense) for the year is attributable to continuing operations.

Exchange movements on the retranslation of net assets could be subsequently reclassified to profit or loss in the event of the disposal of a business.

The notes on pages 7 to 82 are an integral part of these consolidated financial statements.


Consolidated balance sheet
as at 31 December 2017




2017



2016
Note $m $m
Assets
Non-current assets
Goodwill and other intangible assets 8 6,870.8 1,894.5
Property plant and equipment 9 233.5 171.1
Investment in joint ventures 10 239.9 205.9
Long term receivables 12 241.3 87.2
Retirement benefit scheme surplus 30 331.5 -
Deferred tax assets 19 108.5 91.3
8,025.5 2,450.0
Current assets
Inventories 11 14.2 7.0
Trade and other receivables 12 2,628.7 951.7
Financial assets 12 88.2 26.6
Income tax receivable 93.0 14.7
Cash and cash equivalents 13 1,225.5 579.5
4,049.6 1,579.5
Liabilities
Current liabilities
Borrowings 15 543.2 433.6
Trade and other payables 14 2,447.6 589.0
Income tax liabilities 252.7 48.1
3,243.5 1,070.7
Net current assets 806.1 508.8
Non-current liabilities
Borrowings 15 2,336.1 495.0
Deferred tax liabilities 19 181.5 4.7
Retirement benefit scheme deficit 30 163.8 7.0
Other non-current liabilities 16 312.3 173.3
Provisions 18 865.9 70.6
3,859.6 750.6
Net assets 4,972.0 2,208.2
Equity attributable to owners of the parent
Share capital 21 40.5 23.9
Share premium 22 63.9 63.9
Retained earnings 23 1,935.2 2,098.0
Merger reserve 24 2,790.8 -
Other reserves 25 129.9 9.4
Total equity attributable to owners of the parent 4,960.3 2,195.2
Non-controlling interests 26 11.7 13.0
Total equity 4,972.0 2,208.2

The financial statements on pages 2 to 82 were approved by the board of directors on 19 March 2018 and signed

on its behalf by:

Robin Watson, Director                                                          David Kemp, Director

The notes on pages 7 to 82 are an integral part of these consolidated financial statements.


Consolidated statement of changes in equity
for the year to 31 December 2017






Note



Share
capital
$m



Share
premium
$m



Retained
earnings
$m



Merger reserve
$m



Other
reserves
$m
Equity attributable to owners of the parent
$m


Non-
controlling
interests
$m



Total
equity
$m
At 1 January 2016 23.8 63.9 2,162.4 - 148.2 2,398.3 22.7 2,421.0
Profit for the year - - 27.8 - - 27.8 6.6 34.4
Other comprehensive income/(expense):
Re-measurement losses on retirement benefit scheme 30 - - (14.2) - - (14.2) - (14.2)
Movement in deferred tax relating to retirement benefit scheme 5 - - 2.8 - - 2.8 - 2.8
Net exchange movements on retranslation of foreign currency net assets 25/26 - - - - (138.8) (138.8) (0.3) (139.1)
Total comprehensive income/(expense) for the year - - 16.4 - (138.8) (122.4) 6.3 (116.1)
Transactions with owners:
Dividends paid 6/26 - - (116.0) - - (116.0) (6.7) (122.7)
Credit relating to share based charges 20 - - 10.7 - - 10.7 - 10.7
Tax relating to share option schemes 5 - - 6.4 - - 6.4 - 6.4
Shares allocated to employee share trusts 23 0.1 - (0.1) - - - - -
Shares issued by employee share trusts to satisfy option exercises 23 - - 7.5 - - 7.5 - 7.5
Exchange movements in respect of shares held by employee share trusts 23 - - 20.9 - - 20.9 - 20.9
Transactions with non-controlling interests 23/26 - - (10.2) - - (10.2) (9.3) (19.5)
At 31 December 2016 23.9 63.9 2,098.0 - 9.4 2,195.2 13.0 2,208.2
(Loss)/profit for the year - - (32.4) - - (32.4) 2.4 (30.0)
Other comprehensive income/(expense):
Re-measurement losses on retirement benefit scheme 30 - - (1.2) - - (1.2) - (1.2)
Movement in deferred tax relating to retirement benefit scheme 5 - - 0.7 - - 0.7 - 0.7
Cash flow hedges 25 - - - - 1.3 1.3 - 1.3
Net exchange movements on retranslation of foreign currency net assets 25/26 - - - - 119.2 119.2 - 119.2
Total comprehensive income/(expense) for the year - - (32.9) - 120.5 87.6 2.4 90.0
Transactions with owners:
Dividends paid 6/26 - - (125.6) - - (125.6) (4.5) (130.1)
Issue of shares in relation to acquisition of Amec Foster Wheeler 21/24 16.5 - - 2,790.8 - 2,807.3 - 2,807.3
Share based charges attributable to purchase consideration 28 - - 2.1 - - 2.1 - 2.1
Non-controlling interests acquired on Amec Foster Wheeler acquisition 28 - - - - - - 1.2 1.2
Credit relating to share based charges 20 - - 10.2 - - 10.2 - 10.2
Tax relating to share option schemes 5 - - (4.0) - - (4.0) - (4.0)
Deferred tax impact of rate change in equity 19 - - (4.2) - - (4.2) - (4.2)
Shares allocated to employee share trusts 23 0.1 - (0.1) - - - - -
Shares issued by employee share trusts to satisfy option exercises 23 - - 2.4 - - 2.4 - 2.4
Gain on sale of shares sold by employee share trusts 23 - - 3.2 - - 3.2 - 3.2
Exchange movements in respect of shares held by employee share trusts 23 - - (9.9) - - (9.9) - (9.9)
Transactions with non-controlling interests 23/26 - - (4.0) - - (4.0) (0.4) (4.4)
At 31 December 2017 40.5 63.9 1,935.2 2,790.8 129.9 4,960.3 11.7 4,972.0

The notes on pages 7 to 82 are an integral part of these consolidated financial statements.


Consolidated cash flow statement
for the year to 31 December 2017


2017

2016
Note $m $m
Cash generated from operations 27 250.0 245.1
Tax paid (99.6) (55.6)

Net cash generated from operating activities

150.4

189.5
Cash flows from investing activities
Acquisition of subsidiaries (cash acquired less consideration paid) 28 359.8 (17.4)
Disposal of businesses (net of cash disposed) 28 254.9 -
Purchase of property plant and equipment 9 (22.1) (29.0)
Proceeds from sale of property plant and equipment 5.2 24.4
Purchase of intangible assets 8 (57.0) (57.8)
Interest received 3.1 2.4
Repayment of loans from joint ventures 20.8 24.0
Net cash from/(used in) investing activities 564.7 (53.4)
Cash flows from financing activities
Proceeds from/(repayment of) bank loans and overdrafts 27 1,939.2 (241.6)
Borrowings acquired and repaid on acquisition of subsidiaries 28 (1,809.7) -
Proceeds from finance leases 0.5 -
Settlement of derivative financial instruments 17 (21.3) -
Proceeds from disposal of shares by employee share trusts 23 5.6 7.5
Interest paid (53.3) (23.4)
Dividends paid to shareholders 6 (125.6) (116.0)
Dividends paid to non-controlling interests 26 (4.5) (6.7)
Acquisition of non-controlling interests 26 (3.9) (18.8)
Net cash used in financing activities (73.0) (399.0)
Net increase/(decrease) in cash and cash equivalents 27 642.1 (262.9)
Effect of exchange rate changes on cash and cash equivalents 27 3.9 (8.9)
Opening cash and cash equivalents 579.5 851.3
Closing cash and cash equivalents 13 1,225.5 579.5

The notes on pages 7 to 82 are an integral part of these consolidated financial statements.


Notes to the financial statements
for the year to 31 December 2017

General information

John Wood Group PLC, its subsidiaries and joint ventures, (‘the Group’) delivers comprehensive services to support its customers across the complete lifecycle of their assets, from concept to decommissioning, across a range of energy, process and utility markets. Details of the Group’s activities during the year are provided in the Strategic Report.  John Wood Group PLC is a public limited company, incorporated and domiciled in the United Kingdom and listed on the London Stock Exchange. Copies of the Group financial statements are available from the Company’s registered office at 15 Justice Mill Lane, Aberdeen AB11 6EQ.

Accounting Policies

Basis of preparation

These financial statements have been prepared in accordance with IFRS and IFRIC interpretations adopted by the European Union (‘EU’) and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS.  The financial statements are also in compliance with IFRS as issued by the International Accounting Standards Board.  The Group financial statements have been prepared on a going concern basis under the historical cost convention as modified by the revaluation of financial assets and liabilities at fair value through the income statement.

Significant accounting policies

The Group’s significant accounting policies adopted in the preparation of these financial statements are set out below.  These policies have been consistently applied to all the years presented.

Basis of consolidation

The Group financial statements are the result of the consolidation of the financial statements of the Group’s subsidiary undertakings from the date of acquisition or up until the date of divestment as appropriate.  Subsidiaries are entities over which the Group has the power to govern the financial and operating policies and generally accompanies a shareholding of more than one half of the voting rights.  All Group companies apply the Group’s accounting policies and prepare financial statements to 31 December.

Joint ventures

A joint venture is a type of joint arrangement where the parties to the arrangement share rights to its net assets. Joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require unanimous consent of the parties sharing control. The considerations made in determining joint control are similar to those necessary to determine control over subsidiaries.

The Group’s interests in joint ventures are accounted for using equity accounting.  Under the equity method, the investment in a joint venture is initially recognised at cost. The carrying amount of the investment is adjusted to recognise changes in the Group’s share of net assets of the joint venture from the acquisition date. The results of the joint ventures are included in the consolidated financial statements from the date the joint control commences until the date that it ceases. The Group includes its share of joint venture profit on the line ‘Share of post-tax profit from joint ventures’ in the Group income statement and its share of joint venture net assets in the ‘investment in joint ventures’ line in the Group balance sheet.

Critical accounting judgements and estimates

The preparation of the financial statements requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the year.  These estimates and judgements are based on management’s best knowledge of the amount, event or actions and actual results ultimately may differ from those estimates.  The estimates and assumptions that could result in a material adjustment to the carrying amounts of assets and liabilities are addressed below.

(a)           Impairment of goodwill (estimate)

The Group carries out impairment reviews whenever events or changes in circumstance indicate that the carrying value of goodwill may not be recoverable. In addition, the Group carries out an annual impairment review.  An impairment loss is recognised when the recoverable amount of goodwill is less than the carrying amount.  The impairment tests are carried out by CGU (‘Cash Generating Unit’) and reflect the latest Group budgets and forecasts as approved by the Board.  The budgets and forecasts are based on various assumptions relating to the Group’s businesses including assumptions relating to market outlook, resource utilisation, contract awards and contract margins.  The outlook for the Group is discussed in the Chief Executive Review. Pre-tax discount rates of between 10.3% and 11.4% have been used to discount the CGU cash flows and a terminal value is applied using long term growth rates of between 2% and 3%.  A sensitivity analysis has been performed allowing for possible changes to the discount rate, the long term growth rate and the short term EBITA growth rate for certain businesses. See note 8 for further details.

(b) Accounting for acquisition of Amec Foster Wheeler plc (judgement)

The Group acquired Amec Foster Wheeler on 6 October 2017 for a total consideration of $2,809.4m. The provisional acquisition accounting for the transaction is set out in note 28 to the accounts. In completing the accounting, management have been required to make judgements relating to the fair value of the assets and liabilities acquired. In particular, judgement has been used in assessing the valuation of intangible assets acquired and in valuing certain liabilities. Intangible assets of $1,343.6m have been recognised comprising customer relationships, order backlog and brands. The Group used an independent expert to assist in the valuation process. Deferred tax liabilities of $261.5m have been recognised in relation to these intangible assets. Management reviewed the Amec Foster Wheeler balance sheet at the acquisition date and recorded additional net liabilities of $211.4m. This amount comprised $104.5m of fair value adjustments relating to management’s assessment of possible claims made against Amec Foster Wheeler and other judgements made on certain contracts, $49.4m of additional tax provisions and a $57.5m adjustment required to align AFW’s revenue recognition policy on lump sum contracts with Wood Group’s policy. The accounting for the acquisition will be finalised during 2018.

 (c)          Impairment of investment in EthosEnergy joint venture (estimate)

The Group’s investment in the EthosEnergy joint venture is accounted for using equity accounting. An impairment review was carried out in December 2017. Group management’s estimate of fair value less costs of disposal of $77.0m is lower than the book value and an impairment of $28.0m has been recorded in the income statement. If fair value less costs of disposal are ultimately less than $77.0m then a further impairment will be required. See note 10 for further details.

 (d)          Income taxes (judgement and estimate)

The Group is subject to income taxes in numerous jurisdictions and judgement is required in determining the provision for income taxes.  The Group provides for uncertain tax positions based on the best estimate of the most likely outcome in respect of the relevant issue.  Where the final outcome on uncertain tax positions is different from the amounts initially recorded, the difference will have an impact on the Group’s tax charge. There is also judgement required in determining whether deferred tax assets arising on losses should be recognised. The Group recognises deferred tax assets to the extent they can be utilised against future taxable profits. See notes 5 and 19 for further details.

(e)           Retirement benefit schemes (estimate)

The Group operates a number of defined benefit pension schemes which are largely closed to future accrual. The value of the Group’s retirement benefit schemes surplus/deficit is determined on an actuarial basis using a number of assumptions.  Changes in these assumptions will impact the carrying value of the surplus/deficit.  The Group determines the appropriate discount rate to be used in the actuarial valuations at the end of each financial year following consultation with the retirement benefit schemes’ actuaries.  In determining the rate used, consideration is given to the interest rates of high quality corporate bonds in the currency in which the benefits will be paid and that have terms to maturity similar to those of the related retirement benefit obligation.  See note 30 for further details.

(f)            Provisions (judgement and estimate)

The Group records provisions where it has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation and a reliable estimate of the obligation can be made.  Where the outcome is less than probable, but more than remote, no provision is recorded but a contingent liability is disclosed in the financial statements, if material.  The recording of provisions is an area which requires the exercise of management judgement relating to the nature, timing and probability of the liability and typically the Group’s balance sheet includes provisions for doubtful debts, warranty provisions, contract provisions (including onerous contracts) and pending legal issues.

As a result of the acquisition of Amec Foster Wheeler the Group has acquired a significant asbestos related liability. Some of AFW’s legacy US and UK subsidiaries are defendants in asbestos related lawsuits and there are out of court informal claims pending in both jurisdictions. Plaintiffs claim damages for personal injury alleged to have arisen from exposure to the use of asbestos in connection with work allegedly performed by subsidiary companies in the 1970’s and earlier. The provision for asbestos liabilities is the Group’s best estimate of the obligation required to settle claims up until 2050. See note 18 for further details.

(g)           Revenue recognition on fixed price and long term contracts (estimate and judgement)

The Group has a significant number of fixed price long term contracts which are accounted for in accordance with IAS 11 and requires estimates to be made for contract costs and revenues. Contract costs and revenues are affected by a variety of uncertainties that depend on the outcome of future events. Estimates are updated regularly and significant changes are highlighted through established internal review procedures. The contract reviews focus on timing and recognition of revenue including any incentive payments and the recoverability of income from variations to the contract scope or claims. The impact of any change in accounting estimates is then reflected in the ongoing results.

Functional currency

The Group’s earnings stream is primarily US dollars and the principal functional currency is the US dollar, being the most representative currency of the Group.  The Group’s financial statements are therefore prepared in US dollars.

The following exchange rates have been used in the preparation of these financial statements:

2017 2016
Average rate £1 = $ 1.2886 1.3538
Closing rate £1 = $ 1.3528 1.2357

Foreign currencies

In each individual entity, transactions in overseas currencies are translated into the relevant functional currency at the exchange rates ruling at the date of the transaction.  Monetary assets and liabilities denominated in foreign currencies are retranslated at the exchange rates ruling at the balance sheet date.  Any exchange differences are taken to the income statement.

Income statements of entities whose functional currency is not the US dollar are translated into US dollars at average rates of exchange for the period and assets and liabilities are translated into US dollars at the rates of exchange ruling at the balance sheet date.  Exchange differences arising on translation of net assets in such

entities held at the beginning of the year, together with those differences resulting from the restatement of profits and losses from average to year end rates, are taken to the currency translation reserve.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the exchange rate ruling at the balance sheet date.

The directors consider it appropriate to record sterling denominated equity share capital in the financial statements of John Wood Group PLC at the exchange rate ruling on the date it was raised.

Revenue recognition

Revenue comprises the fair value of the consideration received or receivable for the provision of services in the ordinary course of the Group’s activities.  Revenue is recognised only when it is probable that the economic benefits associated with a transaction will flow to the Group and the amount of revenue can be measured reliably. Revenue is recognised as the services are rendered, including where they are based on contractual rates per man hour in respect of multi-year service contracts.  Incentive performance revenue is recognised upon completion of agreed objectives. Revenue is stated net of sales taxes (such as VAT) and discounts.

Revenue on fixed price or lump sum contracts for services, construction contracts and fixed price long-term service agreements is recognised according to the stage of completion reached in the contract by measuring the proportion of costs incurred for work performed to total estimated costs.  An estimate of the profit attributable to work completed is recognised, on a basis that the directors consider to be appropriate, once the outcome of the contract can be estimated reliably, which is when a contract is not less than 20% complete.  When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised immediately. Revenue from variations is only recognised when it is probable that the customer will approve the variations and the related adjustment to contract price can be measured reliably.

A claim is an amount that the contractor seeks to collect from the customer as reimbursement for costs whose inclusion in the contract price is disputed, and may arise from, for example, delays caused by the customer, errors in specification or design and disputed variations in contract work. Claims are included in contract revenue when negotiations with the customer have reached an advanced stage such that it is probable that the customer will accept the claim and the amount of the claim can be measured reliably.

Incentive payments are additional amounts payable to the contractor if specified performance standards are met or exceeded. Incentive payments are recognised when the contract is sufficiently far advanced that it is probable that the required performance standards will be met and the amount of the payment can be measured reliably.

The net amount of costs incurred to date plus recognised profits less progress billings is presented as gross amounts due from customers within trade and other receivables. Gross amounts due to customers are included in trade and other payables and represent payments on account received in excess of amounts due from customers.

Details of the services provided by the Group are provided under the ‘Segmental Reporting’ heading.

Exceptional items

Exceptional items are those significant items which are separately disclosed by virtue of their size or incidence to

enable a full understanding of the Group’s financial performance.  Material transactions which may give rise to exceptional items include gains and losses on divestment of businesses, write downs or impairments of assets

including goodwill, restructuring costs or provisions, litigation settlements, provisions for onerous contracts and acquisition and divestment costs. See note 4 for full details of exceptional items.

Finance expense/income

Interest income and expense is recorded in the income statement in the period to which it relates.  Arrangement fees and expenses in respect of the Group’s debt facilities are amortised over the period which the Group expects the facility to be in place.  Interest relating to the unwinding of discount on deferred and contingent consideration and asbestos liabilities is included in finance expense.  Interest relating to the Group’s retirement benefit schemes are also included in finance income/expense. See note 2 for further details.

Dividends

Dividends to the Group’s shareholders are recognised as a liability in the period in which the dividends are approved by shareholders.  Interim dividends are recognised when paid. See note 6 for further details.

Goodwill

The Group uses the purchase method of accounting to account for acquisitions.  Goodwill represents the excess of the cost of an acquisition over the fair value of the net assets acquired.  Goodwill is carried at cost less

accumulated impairment losses.  Goodwill is not amortised.  Acquisition costs are expensed and included in administrative expenses in the income statement.

Intangible assets

Intangible assets are carried at cost less accumulated amortisation.  Intangible assets are recognised if it is probable that there will be future economic benefits attributable to the asset, the cost of the asset can be measured reliably, the asset is separately identifiable and there is control over the use of the asset.  Where the Group acquires a business, intangible assets on acquisition are identified and evaluated to determine the carrying value on the acquisition balance sheet.  Intangible assets are amortised over their estimated useful lives on a straight line basis, as follows:

                Software                                                                                                                             3-5 years
                Development costs and licenses                                                                                        3-5 years
                Intangible assets on acquisition
                        - Customer contracts and relationships                                                                       5-13 years
                        - Order backlog                                                                                                            2-5 years
                        - Brands                                                                                                                       20 years

Property plant and equipment

Property plant and equipment (PP&E) is stated at cost less accumulated depreciation and impairment.  No depreciation is charged with respect to freehold land and assets in the course of construction.

Depreciation is calculated using the straight line method over the following estimated useful lives of the assets:

                Freehold and long leasehold buildings               25-50 years
                Short leasehold buildings                                   period of lease
                Plant and equipment                                          3-10 years

When estimating the useful life of an asset group, the principal factors the Group takes into account are the durability of the assets, the intensity at which the assets are expected to be used and the expected rate of technological developments.  Asset lives and residual values are assessed at each balance sheet date.

Impairment

The Group performs impairment reviews in respect of PP&E, investment in joint ventures and intangible assets whenever events or changes in circumstance indicate that the carrying amount may not be recoverable.  In addition, the Group carries out annual impairment reviews in respect of goodwill.  An impairment loss is recognised when the recoverable amount of an asset, which is the higher of the asset’s fair value less costs to sell and its value in use, is less than its carrying amount.

For the purposes of impairment testing, goodwill is allocated to the appropriate cash generating unit (‘CGU’).  The CGUs are aligned to the structure the Group uses to manage its business. Cash flows are discounted in determining the value in use.

See note 8 for further details of goodwill impairment testing and note 10 for details of impairment of investment in joint ventures.

Cash and cash equivalents

Cash and cash equivalents include cash in hand and other short-term bank deposits with original maturities of three months or less.  Bank overdrafts are included within borrowings in current liabilities.

Following the issue of a decision by the IFRS Interpretations Committee regarding offsetting and cash pooling arrangements, the Group presents balances that are part of a pooling arrangement on a gross basis in both cash and short term borrowings.

Trade receivables

Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment.  A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables.  The provision is determined by reference to previous experience of recoverability for receivables in each market in which the Group operates.

Trade payables

Trade payables are recognised initially at fair value and subsequently measured at amortised cost.

Borrowings

Borrowings are recognised initially at fair value, net of transaction costs incurred.   Borrowings are subsequently stated at amortised cost.

Deferred and contingent consideration

Where deferred or contingent consideration is payable on the acquisition of a business based on an earn out arrangement, an estimate of the amount payable is made at the date of acquisition and reviewed regularly thereafter, with any change in the estimated liability being reflected in the income statement.  Where deferred consideration is payable after more than one year the estimated liability is discounted using an appropriate rate of interest. Deferred and contingent consideration is recognised at fair value.

Taxation

The tax charge represents the sum of tax currently payable and deferred tax.  Tax currently payable is based on the taxable profit for the year.  Taxable profit differs from the profit reported in the income statement due to items that are not taxable or deductible in any period and also due to items that are taxable or deductible in a different period.  The Group’s liability for current tax is calculated using tax rates enacted or substantively enacted at the balance sheet date.

Deferred tax is provided, using the full liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements.  The principal temporary differences arise from depreciation on PP&E, tax losses carried forward and, in relation to acquisitions, the difference between the fair values of the net assets acquired and their tax base.  Tax rates enacted, or substantively enacted, at the balance sheet date are used to determine deferred tax.

Deferred tax assets are recognised to the extent that it is probable that future taxable profits will be available against which the temporary differences can be utilised.

Accounting for derivative financial instruments and hedging activities

Derivatives are initially recognised at fair value on the date the contract is entered into and are subsequently re-measured at fair value.

Where hedging is to be undertaken, the Group documents the relationship between the hedging instrument and the hedged item at the inception of the transaction, as well as the risk management objective and strategy for undertaking the hedge transaction.  The Group also documents its assessment, both at hedge inception and on an ongoing basis, of whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in fair values or cash flows of the hedged items.

Fair value estimation

The fair value of interest rate swaps is calculated as the present value of their estimated future cash flows.  The fair value of forward foreign exchange contracts is determined using forward foreign exchange market rates at the balance sheet date.  The fair values of all derivative financial instruments are obtained from valuations provided by financial institutions.

The carrying values of trade receivables and payables approximate to their fair values.

The fair value of financial liabilities is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Group for similar financial instruments.

Operating leases

As lessee

Payments made under operating leases are charged to the income statement on a straight line basis over the period of the lease.  Benefits received and receivable as an incentive to enter into an operating lease are also spread on a straight line basis over the lease period.

As lessor

Operating lease rental income arising from leased assets is recognised in the income statement on a straight line basis over the lease period.

Finance leases

A lease that transfers substantially all the risks and rewards incidental to ownership to the Group is classified as a finance lease. Finance leases are capitalised at the commencement of the lease at the present value of the minimum lease payments. Lease payments are apportioned between finance expense and a reduction of the lease liability so as to achieve a constant rate of interest on the outstanding balance. Leased assets are depreciated over their estimated useful life.

Retirement benefit scheme surplus/deficit

The Group operates a number of defined benefit and defined contribution pension schemes.  The surplus or deficit recognised in respect of the defined benefit schemes represents the difference between the present value of the defined benefit obligations and the fair value of the scheme assets.  The assets of these schemes are held in separate trustee administered funds. The schemes are largely closed to future accrual.

The defined benefit schemes assets are measured using fair values.  Pension scheme liabilities are measured annually by an independent actuary using the projected unit method and discounted at the current rate of return on a high quality corporate bond of equivalent term and currency to the liability.  The increase in the present value of the liabilities of the Group’s defined benefit schemes expected to arise from employee service in the period is charged to operating profit.  The interest income on scheme assets and the increase during the period in the present value of the schemes liabilities arising from the passage of time are netted and included in finance income/expense.  Re-measurement gains and losses are recognised in the statement of comprehensive income in full in the period in which they occur.  The defined benefit schemes surplus or deficit is recognised in full and presented on the face of the Group balance sheet.

The Group’s contributions to defined contribution schemes are charged to the income statement in the period to which the contributions relate.

The Group operates a SERP pension arrangement in the US for certain employees. Contributions are paid into a separate investment vehicle and invested in a portfolio of US funds that are recognised by the Group as a long term receivable with a corresponding liability in other non-current liabilities.   Investments are carried at fair value.  The fair value of listed equity investments and mutual funds is based on quoted market prices and so the fair value measurement can be categorised in Level 1 of the fair value hierarchy.

Provisions

Provision is made for the estimated liability on all services under warranty, including claims already received, based on past experience.  Other provisions are recognised where the Group is deemed to have a legal or constructive obligation, it is probable that a transfer of economic benefits will be required to settle the obligation, and a reliable estimate of the obligation can be made.  Where amounts provided are payable after more than one year the estimated liability is discounted using an appropriate rate of interest. See note 18 for further details.

Share based charges relating to employee share schemes

The Group has recorded share based charges in relation to a number of employee share schemes.

Charges are recorded in the income statement as an employee benefit expense for the fair value of share options (as at the grant date) expected to be exercised under the Executive Share Option Schemes (‘ESOS’) and the Long Term Retention Plan (‘LTRP’). Amounts are accrued over the vesting period with the corresponding credit recorded in retained earnings.

Options are also awarded under the Group’s Long Term Plan (‘LTP’) which is the incentive scheme in place for executive directors and certain senior executives. The charge for options awarded under the LTP is based on the fair value of those options at the grant date, spread over the vesting period.  The corresponding credit is recorded in retained earnings.  For awards that have a market related performance measure, the fair value of the market related element is calculated using a Monte Carlo simulation model.

The Group has an Employee Share Plan under which employees contribute regular monthly amounts which are used to purchase shares over a one year period. At the end of the year the participating employees are awarded one free share for every three shares purchased providing they remain in employment for a further year. A charge is calculated for the award of free shares and accrued over the vesting period with the corresponding credit taken to retained earnings.

For further details of these schemes, please see note 20 and the Directors Remuneration Report.

Share capital

John Wood Group PLC has one class of ordinary shares and these are classified as equity.  Dividends on ordinary shares are not recognised as a liability or charged to equity until they have been approved by shareholders.

The Group is deemed to have control of the assets, liabilities, income and costs of its employee share trusts, therefore they have been consolidated in the financial statements of the Group.  Shares acquired by and disposed of by the employee share trusts are recorded at cost.  The cost of shares held by the employee share trusts is deducted from equity.

Segmental reporting

The Group has determined that its operating segments are based on management reports reviewed by the Chief Operating Decision Maker (‘CODM’), the Group’s Chief Executive.  The Group’s reportable segments are Asset  Solutions  Europe, Africa, Asia, Australia (‘ASEAAA’), Assets Solutions Americas (‘ASA’), Specialist Technical Solutions (‘STS’), Environmental and Infrastructure Solutions (‘E&IS’) and Investment Services.

Asset Solutions is focused on increasing production, improving efficiency, reducing cost and extending asset life and provides initial  design, construction, operations, maintenance and decommissioning services mainly in the oil and gas sector. STS provides a range of specialist, largely technology related services focused on solving complex technological challenges across a broad range of energy and industrial sectors. E&IS provides consulting, engineering, project and construction management services to a range of sectors including government, water, transport, energy and pharmaceuticals. Investment Services manages a range of legacy or non-core businesses and investments with a view to generating value via remediation and restructuring prior to their eventual disposal.

The Chief Executive measures the operating performance of these segments using ‘EBITA’ (Earnings before interest, tax and amortisation).  Operating segments are reported in a manner consistent with the internal management reports provided to the Chief Executive who is responsible for allocating resources and assessing performance of the operating segments.

Assets and liabilities held for sale

Disposal groups are classified as assets and liabilities held for sale if it is highly probable that they will be recovered primarily through sale rather than continuing use. Assets are measured at the lower of cost and fair value less costs to sell.

Research and development government credits

The Group claims research and development government credits in the UK, US and Canada. These credits are similar in nature to grants and are offset against the related expenditure category in the income statement. The credits are recognised when there is reasonable assurance that they will be received, which in some cases can be some time after the original expense is incurred.

Disclosure of impact of new and future accounting standards

(a) Amended standards and interpretations

The following standards and interpretations apply for the first time to accounting periods commencing on or after 1 January 2017:

The introduction of these standards and interpretations does not have a material impact on the Group’s financial statements.

(b) Standards, amendments and interpretations to existing standards that are not yet effective and have not been early adopted by the Group

The following standards have been published and are mandatory for the Group’s accounting periods beginning on or after 1 January 2018, but the Group has not early adopted them:

All other amendments not yet effective and not included above are not material or applicable to the Group.
 

Notes to the financial statements
for the year ended 31 December 2017

1         Segmental reporting

The Group operates through five segments, Asset Solutions EAAA, Asset Solutions Americas, Specialist Technical Solutions, Environment & Infrastructure Solutions and Investment Services. Asset Solutions EAAA and Asset Solutions Americas have been renamed and Environment & Infrastructure Solutions and Investment Services are new reportable segments following the Amec Foster Wheeler acquisition in 2017.

Under IFRS 11 ‘Joint arrangements’, the Group is required to account for joint ventures using equity accounting, however for management reporting the Group continues to use proportional consolidation, hence the inclusion of the proportional presentation in this note.

The segment information provided to the Group’s Chief Executive for the reportable operating segments for the year ended 31 December 2017 includes the following:

Reportable Operating Segments Revenue EBITDA(1) EBITA(1) Operating profit
Year ended
31 Dec 2017
Year ended
31 Dec 2016
Year ended
31 Dec 2017
Year ended
31 Dec 2016
Year ended
31 Dec 2017
Year ended
31 Dec 2016
Year ended
31 Dec 2017
Year ended
31 Dec 2016
$m $m $m $m $m $m $m $m

Asset Solutions EAAA
2,617.0 2,331.3 162.6 166.7 139.8 143.4 57.1 (9.5)
Asset Solutions Americas 2,387.2 2,115.2 179.8 203.1 157.7 176.3 69.0 100.8
Specialist Technical Solutions 755.9 487.5 85.8 82.1 82.1 79.2 61.9 58.1
Environment & Infrastructure Solutions 321.3 - 26.0 - 24.7 - 12.1 -
Investment Services 85.4 - 5.3 - 5.3 - 1.2 -
Central costs (2) 2.2 - (36.4) (32.2) (38.0) (35.5) (147.0) (45.2)

Total
6,169.0 4,934.0 423.1 419.7 371.6 363.4 54.3 104.2
Remove share of joint ventures (774.6) (813.4) (61.9) (60.3) (52.2) (50.1) (49.2) (18.2)

Total continuing operations excluding joint ventures
5,394.4 4,120.6 361.2 359.4 319.4 313.3 5.1 86.0

Share of post-tax profit from joint ventures
31.3 3.4
Operating profit 36.4 89.4
Finance income 2.8 2.2
Finance expense (60.8) (25.6)
(Loss/)profit before taxation from continuing operations (21.6) 66.0
Taxation (8.4) (31.6)
(Loss)/profit for the year from continuing operations (30.0) 34.4

Notes

  1. A reconciliation from Operating profit (before exceptional items)  to EBITA and EBITDA is provided in the table below. EBITDA represents EBITA before depreciation of property plant and equipment of $51.5m (2016 : $56.3m).  EBITA and EBITDA are provided as they are units of measurement used by the Group in the management of its business.
  2. Central costs include the costs of certain management personnel in both the UK and the US, along with an element of Group infrastructure costs.
  3. Revenue arising from sales between segments is not material.

Reconciliation of Operating Profit to EBITA and EBITDA

2017 2016
$m $m
Operating profit 36.4 89.4
Share of joint venture interest 3.4 2.4
Share of joint venture tax 14.5 12.4
Operating profit (including share of joint ventures) 54.3 104.2
Continuing exceptional items 176.0 154.9
EBIT 230.3 259.1
Amortisation (including joint ventures) 141.3 104.3
EBITA 371.6 363.4
Depreciation (including joint ventures) 51.5 56.3
EBITDA 423.1 419.7

Segment assets and liabilities



At 31 December 2017

Asset Solutions EAAA
$m

Asset Solutions Americas
$m

Specialist Technical Solutions
$m
Environment and Infrastructure Solutions
$m


Investment
 Services
$m



Unallocated
$m



Total
 $m
Segment assets 3,177.0 3,595.7 1,541.6 1,295.9 430.9 2,034.0 12,075.1
Segment liabilities 1,063.0 997.7 380.9 241.7 324.1 4,095.7 7,103.1
At 31 December 2016
Segment assets 1,008.7 1,878.8 281.7 - - 860.3 4,029.5
Segment liabilities 386.4 323.1 96.5 - - 1,015.3 1,821.3

Unallocated assets and liabilities include income tax, deferred tax and cash and cash equivalents and borrowings where this relates to the financing of the Group’s operations.

Environment & Infrastructure Solutions and Investment Services are new reportable segments in 2017 following the Amec Foster Wheeler acquisition.

Other segment items



At 31 December 2017

Asset Solutions EAAA
$m

Asset Solutions Americas
$m

Specialist Technical Solutions
$m
Environment and Infrastructure Solutions
$m


Investment
 Services
$m



Unallocated
$m



Total
 $m
Capital expenditure
PP&E 9.1 9.1 2.6 0.4 0.1 0.8 22.1
Intangible assets 20.1 24.7 4.8 0.1 - 7.3 57.0
Non-cash expense
Depreciation 13.3 21.9 3.7 1.3 - 1.6 41.8
Amortisation 33.5 80.3 16.2 8.1 0.9 0.4 139.4
Exceptional items 42.9 3.7 2.3 3.4 2.4 45.1 99.8
At 31 December 2016
Capital expenditure
PP&E 20.4 6.2 0.8 - - 1.6 29.0
Intangible assets 26.8 18.5 5.0 - - 7.5 57.8
Non-cash expense
Depreciation 13.5 26.4 2.9 - - 3.3 46.1
Amortisation 20.0 64.8 10.0 - - 7.5 102.3
Exceptional items 86.9 6.7 5.2 - - 1.1 99.9

The figures in the tables above are prepared on an equity accounting basis and therefore exclude the share of joint ventures.

Depreciation in respect of joint ventures totals $9.7m (2016: $10.2m) and joint venture amortisation amounts to $1.9m (2016: $2.0m).

Environment & Infrastructure Solutions and Investment Services are new reportable segments in 2017 following the Amec Foster Wheeler acquisition.

Geographical segments

Segment assets Continuing revenue
2017 2016 2017 2016
$m $m $m $m
UK 2,665.2 842.3 900.5 866.7
US 4,939.9 1,852.8 2,253.0 1,848.0
Rest of the world 4,470.0 1,334.4 2,240.9 1,405.9
12,075.1 4,029.5 5,394.4 4,120.6

Revenue by geographical segment is based on the location of the ultimate project. Revenue is attributable to the provision of services.


2  Finance expense/(income)

2017 2016
$m $m
Interest payable on senior loan notes 14.1 14.1
Interest payable on borrowings 20.8 4.8
Amortisation of bank facility fees 1.6 0.7
Interest expense – retirement benefit obligations (note 30) 2.6 -
Unwinding of discount on deferred and contingent consideration liabilities 2.3 2.6
Unwinding of discount on asbestos provision (note 18) 4.0 -
Other interest expense 6.9 3.4

Finance expense – pre-exceptional items

52.3

25.6

Bank fees relating to Amec Foster Wheeler acquisition

8.5

-
Finance expense – continuing operations 60.8 25.6
Interest receivable (2.8) (2.0)
Interest income – retirement benefit obligations (note 30) - (0.2)
Finance income (2.8) (2.2)
Finance expense – continuing operations – net 58.0 23.4

$15.5m of participation fees were paid in relation to the new bank facilities and this amount is being amortised over the facility term.

Bank fees of $8.5m relating to the acquisition of Amec Foster Wheeler have been treated as exceptional items and include $6.4m of one-off underwriting and ticking fees and $2.1m relating to the write off of capitalised fees in respect of the previous bank facilities.

Net interest expense of $3.4m (2016: $2.4m) has been deducted in arriving at the share of post-tax profit from joint ventures.


3  Profit before taxation

2017 2016
$m $m
The following items have been charged/(credited) in arriving at profit before taxation  :
Employee benefits expense (note 29) 2,741.6 2,210.1
Depreciation of property plant and equipment (note 9) 41.8 46.1
Amortisation of intangible assets (note 8) 139.4 102.3
Gain on disposal of property plant and equipment (1.3) (4.7)
Other operating lease rentals payable:
- Plant and machinery 22.9 26.3
- Property 110.7 77.0
Foreign exchange losses/(gains) 0.7 (3.0)

Depreciation of property plant and equipment is included in cost of sales or administrative expenses in the income statement.  Amortisation of intangible assets is included in administrative expenses in the income statement.

Services provided by the Group’s auditors and associate firms

During the year the Group obtained the following services from its auditors, PwC and associate firms at costs as detailed below:

2017 2016
$m $m
Fees payable to the Group’s auditors and its associate firms for -
Audit of parent company and consolidated financial statements

1.0

1.0
Audit of Group companies pursuant to legislation
Reporting accountant and due diligence services in relation to AFW acquisition
2.9
2.5
1.9
-
Tax and other services 0.2 0.1
6.6 3.0

In addition to the above, fees totalling $5.8m are payable to Ernst & Young LLP for work done in relation to the audit of Amec Foster Wheeler and its subsidiaries.


4  Exceptional items

2017  2016
$m $m
Exceptional items included in continuing operations
Acquisition costs in respect of the acquisition of Amec Foster Wheeler
Redundancy, restructuring and integration costs
58.9
51.4
-
65.9
Arbitration settlement provision 19.2 -
Investigation support costs 8.2 -
Impairment of investment in EthosEnergy 28.0 56.7
Impairments recorded by EthosEnergy 1.1 29.9
Other write offs relating to EthosEnergy 9.2 2.4
176.0 154.9
Bank fees relating to Amec Foster Wheeler acquisition 8.5 -
184.5 154.9
Tax credit (19.4) (15.1)
Continuing operations exceptional items, net of tax 165.1 139.8

Acquisition costs of $58.9m have been incurred during the year in relation to the acquisition of Amec Foster Wheeler. These costs include broker and legal fees as well as other advisor and regulatory fees. In addition, $8.5m of bank fees have been expensed in respect of the new borrowing facility required to fund the acquisition (see note 2).

Redundancy, restructuring and integration costs of $51.4m have been incurred during the year. The total includes $28.1m of redundancy and restructuring costs, $14.1m of integration costs in relation to the acquisition of Amec Foster Wheeler and $9.2m of costs relating to onerous property leases.

A charge of $19.2m has been recorded in relation to a legacy contract carried out by our Gas Turbine Services business prior to the formation of EthosEnergy. Arbitration hearings have been held in relation to a dispute between the Group and a former subcontractor and this amount represents our best estimate of the likely settlement including related legal costs. The outcome of the arbitration hearing is likely to be known in the first half of 2018.

Investigation support costs of $8.2m have been incurred during the period in relation to ongoing investigations by the US Securities and Exchange Commission, the US Department of Justice and UK Serious Fraud Office. See note 32 for full details.

At 31 December 2017, the Group carried out an impairment review of its investment in the EthosEnergy joint venture. The recoverable amount of the investment, based on management’s estimate of fair value less costs of disposal of $77.0m, is lower than the book value and an impairment charge of $28.0m has been booked in the income statement (see note 10). In addition, EthosEnergy has recorded exceptional charges of $1.1m during the year relating to the closure of its power solutions business. The Group has also written off receivables of $5.7m in relation to a balance due by EthosEnergy and booked a $3.5m charge in relation to a likely settlement of indirect taxes.

The allocation of continuing exceptionals (excluding bank fees) of $176.0m by segment is as follows – EAAA $47.3m, Americas $8.4m, STS $4.0m, E&IS $4.5m, Investment Services $3.2m and Central $108.6m.

A tax credit of $19.4m has been recorded against exceptional items.

For further details of the 2016 exceptional items please refer to the 2016 Annual Report and Accounts.


5  Taxation

2017 2016
$m $m
Current tax
Current year 87.8 49.6
Adjustment in respect of prior years (21.3) (9.5)
66.5 40.1
Deferred tax
Current year (55.3) (11.8)
Adjustment in respect of prior years (2.8) 3.3
(58.1) (8.5)

Total tax charge

8.4

31.6
Comprising -
Tax on continuing operations before exceptional items 27.8 46.7
Tax on exceptional items in continuing operations (19.4) (15.1)
Total tax charge 8.4 31.6

   

2017 2016
Tax charged/(credited) to equity $m $m
Deferred tax movement on retirement benefit liabilities (0.7) (2.8)
Deferred tax relating to share option schemes 5.8 (4.9)
Current tax relating to share option schemes (1.8) (1.5)
Deferred tax impact of rate change 4.2 -
Total charged/(credited) to equity 7.5 (9.2)

Tax is calculated at the rates prevailing in the respective jurisdictions in which the Group operates.  The expected rate is the weighted average rate taking into account the Group’s profits in these jurisdictions.  The expected rate has increased in 2017 due to the change in mix of the tax jurisdictions in which the Group operates. The tax charge for the year is higher (2016: higher) than the expected tax (credit)/charge due to the following factors:

2017 2016
$m $m
(Loss)/profit before taxation from continuing operations (excluding profits from and impairment of joint ventures) (24.9) 119.3
(Loss)/profit before tax at expected rate of 27.5% (2016: 24.7%) (6.8) 29.5
Effects of:
Adjustments in respect of prior years (24.1) (6.2)
Non-recognition of losses and other attributes (9.4) 10.0
Effect of foreign taxes 19.3 8.0
One-off impact of tax reform (13.0) -
Other permanent differences 42.4 (9.7)
Total tax charge 8.4 31.6

The adjustment in respect of prior years is largely due to the release of uncertain tax provisions as the final outcome on certain issues was agreed during the year.

The one-off impact of tax reform is as a result of a reduction in the US tax rate from 1 January 2018 reducing the Group’s deferred tax liability as well as changes in loss utilisation rules in the UK allowing losses that would not otherwise have been accessible to be utilised against future profits.

Other permanent differences include adjustments for share based charges, research and development allowances, changes in unrecognised tax attributes and expenditure which is not tax deductible. Tax losses are recognised where there is reasonable certainty that they can be utilised in future years. Other permanent differences in 2017 have been impacted by a restructure of Amec Foster Wheeler’s US business and the resulting tax charge on the related intercompany transactions although this has been partly offset by the utilisation of the businesses unrecognised tax losses.

Net income tax liabilities in the Group balance sheet include $265.2m relating to uncertain tax positions where management has had to exercise judgement in determining the most likely outcome in respect of the relevant issue. The larger amounts relate to tax payable in relation to divestments ($13.0m), recoverability of withholding taxes ($81.6m), and group financing ($51.4m). Where the final outcome on these issues differs to the amounts provided, the Group’s tax charge will be impacted.

Amounts are netted in the Group balance sheet where corporate tax assets and liabilities are in the same jurisdictions and to the extent there is a legal right of offset.


6  Dividends

2017 2016
$m $m
Dividends on ordinary shares

Final 2016 dividend paid: 22.5 cents per share (Final 2015: 20.5 cents)

83.9

75.9
Interim 2017 dividend paid: 11.1 cents per share (Interim 2016: 10.8 cents) 41.7 40.1
125.6 116.0

The directors are proposing a final dividend in respect of the financial year ended 31 December 2017 of 23.2 cents per share.  The final dividend will be paid on 17 May 2018 to shareholders who are on the register of members on 20 April 2018.  The financial statements do not reflect the final dividend, the payment of which will result in an estimated $155.1m reduction in equity attributable to owners of the parent.


7  Earnings per share

2017 2016
Earnings/(losses) attributable to owners of the parent


Number of shares



Earnings per share

Earnings attributable to owners of the parent



Number of shares



Earnings per share
$m m cents $m m cents
Basic pre-exceptional 132.7 440.0 30.1 167.6 370.9 45.2
Exceptional items, net of tax (165.1) - (37.5) (139.8) - (37.7)
Basic (32.4) 440.0 (7.4) 27.8 370.9 7.5
Effect of dilutive ordinary shares - - - - 12.0 (0.2)
Diluted (32.4) 440.0 (7.4) 27.8 382.9 7.3
Adjusted diluted earnings per share calculation
Basic (32.4) 440.0 (7.4) 27.8 370.9 7.5
Effect of dilutive ordinary shares    - 11.3 0.2 - 12.0 (0.2)
(32.4) 451.3 (7.2) 27.8 382.9 7.3
Exceptional items, net of tax 165.1 - 36.6 139.8 - 36.5
Amortisation, net of tax 107.7 - 23.9 77.9 - 20.3
Adjusted diluted 240.4 451.3 53.3 245.5 382.9 64.1
Adjusted basic 240.4 440.0 54.6 245.5 370.9 66.2

As the Group has reported a basic loss per ordinary share, any potential ordinary shares are anti-dilutive and are excluded from the calculation of diluted loss per share. These options could potentially dilute earnings per share in future periods. As adjusted diluted earnings per share is a non-GAAP measure, the potential ordinary shares have not been excluded from this calculation.

The calculation of basic earnings per share is based on the earnings attributable to owners of the parent divided by the weighted average number of ordinary shares in issue during the year excluding shares held by the Group’s employee share trusts.  For the calculation of diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion of dilutive potential ordinary shares.  The Group’s dilutive ordinary shares comprise share options granted to employees under Executive Share Option Schemes and the Long Term Retention Plan, shares and share options awarded under the Group’s Long Term Plan and shares awarded under the Group’s Employee Share Plan.  Adjusted basic and adjusted diluted earnings per share are disclosed to show the results excluding the impact of exceptional items and amortisation, net of tax.


8  Goodwill and other intangible assets




Goodwill

Software and development costs

Customer contracts and relationships


Order backlog



Brands



Total
$m $m $m $m $m $m
Cost
At 1 January 2017 1,706.0 256.8 432.6 - - 2,395.4
Exchange movements 99.4 16.3 17.4 0.5 3.5 137.1
Additions - 57.0 - - - 57.0
Acquisitions (note 28) 3,554.6 35.1 444.6 184.2 727.1 4,945.6
Disposals - (7.0) - - - (7.0)
At 31 December 2017 5,360.0 358.2 894.6 184.7 730.6 7,528.1
Amortisation and impairment
At 1 January 2017 0.8 182.1 318.0 - - 500.9
Exchange movements - 11.2 12.6 0.1 0.1 24.0
Amortisation charge - 59.3 58.5 12.6 9.0 139.4
Disposals - (7.0) - - - (7.0)
At 31 December 2017 0.8 245.6 389.1 12.7 9.1 657.3
Net book value at 31 December 2017
5,359.2

112.6

505.5

172.0

721.5

6,870.8
Cost
At 1 January 2016 1,766.1 233.5 433.5 - - 2,433.1
Exchange movements (78.4) (14.2) (7.3) - - (99.9)
Additions - 57.8 - - - 57.8
Acquisitions (note 28) 18.3 0.1 6.4 - - 24.8
Disposals - (20.4) - - - (20.4)
At 31 December 2016 1,706.0 256.8 432.6 - - 2,395.4
Amortisation and impairment
At 1 January 2016 0.8 155.4 272.4 - - 428.6
Exchange movements - (6.7) (4.3) - - (11.0)
Amortisation charge - 52.4 49.9 - - 102.3
Disposals - (19.0) - - - (19.0)
At 31 December 2016 0.8 182.1 318.0 - - 500.9
Net book value at 31 December 2016
1,705.2

74.7

114.6

-

-

1,894.5

As per note 28, goodwill acquired during the year comprises $3,514.5m in relation to the Amec Foster Wheeler acquisition, $38.8m in relation to CEC and $1.3m in relation to acquisitions in prior periods.

In accordance with IAS 36 ‘Impairment of assets’, goodwill was tested for impairment during the year.  The impairment tests were carried out by Cash Generating Unit (‘CGU’). The Group has five reportable segments. Goodwill is monitored by management at the level of these segments. Goodwill is allocated to CGU’s as indicated in the table below.

Value-in-use calculations have been prepared for each CGU using the cash flow projections included in the financial budgets and forecasts prepared by management and approved by the Board for 2018 and 2019.  The budgets and forecasts are based on various assumptions including market outlook, resource utilisation, contract backlog, contract margins and assumed contract awards. Growth rates of between 5% and 9% per annum have been assumed for 2020 and for 2021 and 2022 cash flows have been extrapolated using a growth rate of 3% for Asset Solutions EAAA, Specialist Technical Solutions and Investment Services and 2% for Asset Solutions Americas and Environmental and Infrastructure Solutions.  A terminal value is applied thereafter in order to calculate long term estimated cash flows using the same anticipated growth rates.  The growth rates used do not exceed the long-term average growth rates for the regions in which the CGUs operate.  The cash flows have been discounted using discount rates appropriate for each CGU, and these are reviewed annually. The pre-tax rates used for the 2017 review are as follows - 10.8% for Asset Solutions EAAA, 10.6% for Asset Solutions Americas, 11.4% for Specialist Technical Solutions 10.3% for Environmental and Infrastructure Solutions and 10.7% for Investment Services (the equivalent post-tax rates are 9.5%, 9.25%, 10.0%, 9.25% and 9.5% respectively).

The carrying value of the goodwill for each CGU is shown in the table below. No goodwill has been written off during the current or prior year.

Cash Generating Unit Goodwill carrying value ($m)
Asset Solutions EAAA 2,033.6
Asset Solutions Americas 1,754.7
Specialist Technical Solutions 921.8
Environmental and Infrastructure Solutions 489.0
Investment Services 160.1

A sensitivity analysis has been performed on the basis of a 1% reduction in the long term growth rate and a 1% increase in the discount rate in order to assess the impact of reasonable possible changes to the assumptions used in the impairment review.  A 1% reduction in the long term growth rate would result in an impairment of $166.9m in Assets Solutions EAAA. A 1% increase in the discount rate would result in an impairment of $242.7m in Asset Solutions EAAA. In addition, if the short term EBITA growth rates assumed by management for Asset Solutions EAAA in 2018 and 2019 were 3% lower than projected then an impairment would result. The lower headroom in Asset Solutions EAAA is primarily due to challenging market conditions in the North Sea. The sensitivity analysis did not identify any potential impairments other than those mentioned above for Asset Solutions EAAA.

Intangible assets arising on acquisition include the valuation of customer contracts and relationships, order backlog and brands recognised on business combinations. As part of the annual impairment review, Group management has assessed whether there were any impairment triggers and none were identified.


9  Property plant and equipment

Land and Buildings Plant and equipment
Total
$m $m $m
Cost
At 1 January 2017 80.7 208.3 289.0
Exchange movements 5.6 13.1 18.7
Additions 1.2 20.9 22.1
Acquisitions (note 28) 41.9 41.9 83.8
Disposals (5.8) (23.6) (29.4)
Reclassifications - 5.8 5.8
At 31 December 2017 123.6 266.4 390.0
Accumulated depreciation and impairment
At 1 January 2017               33.2 84.7 117.9
Exchange movements 1.2 14.0 15.2
Charge for the year 7.9 33.9 41.8
Disposals (5.6) (19.9) (25.5)
Impairment 0.4 2.3 2.7
Reclassifications - 4.4 4.4
At 31 December 2017 37.1 119.4 156.5
Net book value at 31 December 2017 86.5 147.0 233.5
Cost
At 1 January 2016 73.0 242.8 315.8
Exchange movements (4.6) (11.8) (16.4)
Additions 9.8 19.2 29.0
Acquisitions 0.4 0.7 1.1
Disposals (5.0) (47.6) (52.6)
Reclassifications 7.1 5.0 12.1

At 31 December 2016

80.7

208.3

289.0
Accumulated depreciation and impairment
At 1 January 2016 30.7 80.9 111.6
Exchange movements (2.4) (7.5) (9.9)
Charge for the year 6.9 39.2 46.1
Disposals (2.0) (30.8) (32.8)
Impairment - 2.9 2.9
At 31 December 2016 33.2 84.7 117.9

Net book value at 31 December 2016

47.5

123.6

171.1

The net book value of Land and Buildings includes $53.6m (2016: $24.8m) of Long Leasehold and Freehold property and $32.9m (2016:$22.7m) of Short Leasehold property.

There were no material amounts in assets under construction at 31 December 2017.


10  Investment in joint ventures

The Group operates a number of joint ventures companies, the most significant of which are its turbine JV’s, EthosEnergy Group Limited and RWG (Repair & Overhauls) Limited. The Group has a 51% shareholding in EthosEnergy, a provider of rotating equipment services and solutions to the power, oil and gas and industrial markets. EthosEnergy is based in Aberdeen, Scotland. The Group has a 50% shareholding in RWG, a provider of repair and overhaul services to the oil and gas, power generation and marine propulsion industries. RWG is based in Aberdeen, Scotland.

The assets, liabilities, income and expenses of the EthosEnergy and RWG are shown below. The financial information below has been extracted from the management accounts for these entities.

EthosEnergy (100%) RWG (100%)
2017 2016 2017 2016
$m $m $m $m
Non-current assets 162.1 151.2 37.9 34.6
Current assets 723.9 683.4 126.0 121.6
Current liabilities (310.2) (300.8) (40.9) (36.6)
Non-current liabilities (114.8) (99.8) (2.9) (0.8)
Net assets 461.0 434.0 120.1 118.8
Wood Group share

Impairments and other adjustments
235.1

(158.1)
221.3

(121.3)
60.1

-
59.4

-
Wood Group investment 77.0 100.0 60.1 59.4
Revenue 842.2 815.1 206.0 231.8
Cost of sales (722.5) (703.1) (147.7) (165.0)
Administrative expenses (93.6) (101.9) (29.7) (33.4)
Exceptional items (2.2) (58.7) - -
Operating profit/(loss) 23.9 (48.6) 28.6 33.4
Net finance (expense)/income (5.5) (4.4) - 0.1
Profit/(loss) before tax 18.4 (53.0) 28.6 33.5
Tax (8.6) (4.8) (6.9) (7.6)
Post-tax profit/(loss) from joint ventures 9.8 (57.8) 21.7 25.9
Wood Group share            5.0 (29.5) 10.9 13.0

The Group has carried out an impairment review on the valuation of its EthosEnergy joint venture at 31 December 2017.  Management’s estimate of fair value less costs of disposal is $77.0m which is lower than the book value and an impairment charge of $28.0m has been recorded in the income statement. The fair value is supported by third party market data. If fair value less costs of disposal are ultimately less than $77.0m then a further impairment will be required.

EthosEnergy has also recorded impairment losses of $1.1m (Wood Group share) relating to the closure of its power solutions business. This charge is reflected in the exceptional expense line in the table below.  

EthosEnergy’s net borrowings, including parent company loans, at 31 December 2017 amounted to $92.6m.

RWG had net cash at 31 December 2017 of $9.2m.

The Group’s share of its joint venture income and expenses is shown below.

2017 2016
$m $m
Revenue 774.6 813.4
Cost of sales (650.7) (687.5)
Administrative expenses (73.6) (77.8)
Exceptional expense (1.1) (29.9)
Operating profit 49.2 18.2
Net finance expense/(income) (3.4) (2.4)
Profit before tax 45.8 15.8
Tax (14.5) (12.4)
Share of post-tax profit from joint ventures 31.3 3.4

The movement in investment in joint ventures is shown below.

$m
At 1 January 2017 205.9
Exchange movements on retranslation of net assets 7.2
Acquired 55.5
Share of profit after tax 31.3
Impairment of investments (28.0)
Dividends (32.0)

At 31 December 2017

239.9

The joint ventures have no significant contingent liabilities to which the Group is exposed, nor has the Group any significant contingent liabilities in relation to its interest in the joint ventures.

A full list of subsidiary and joint venture entities is included in note 35.


11  Inventories

2017 2016
$m $m
Materials 7.8 2.7
Work in progress 2.1 0.5
Finished goods and goods for resale 4.3 3.8
14.2 7.0


12  Trade and other receivables

2017 2016
$m $m
Trade receivables 1,798.1 785.8
Less: provision for impairment of trade receivables (93.0) (24.7)
Trade receivables – net 1,705.1 761.1
Gross amounts due from customers 571.0 3.9
Prepayments and accrued income 131.6 33.4
Loans due from joint ventures 59.9 80.7
Other receivables 161.1 72.6
Trade and other receivables – current 2,628.7 951.7
Long term receivables 241.3 87.2
Total receivables 2,870.0 1,038.9

The net amount of costs incurred to date plus recognised profits less progress billings on long term contracts is presented as gross amounts due from customers above.

The aggregate amount of costs incurred plus recognised profits (less recognised losses) for all long-term contracts in progress at the balance sheet date amounted to $12,403.1m.

Long term receivables include $83.8m relating to the US SERP pension arrangement referred to in note 30.

Financial assets

2017 2016
$m $m
Bank deposits (more than three months) 31.2 -
Restricted cash 26.5 26.5
Derivative financial instruments 30.5 0.1
88.2 26.6

The restricted cash of $26.5m (2016: $26.5m) is cash that is subject to an attachment order. The Group cannot access this cash until it receives a release letter from the Courts and as a result the cash balance is presented in financial assets. Management believe it is appropriate to include the restricted cash balance in the Group’s net debt figure (see note 27).

Bank deposits of more than three months of $31.2m are short term instruments held by Amec Foster Wheeler’s insurance captive.

The Group’s trade receivables balance is shown in the table below.

Trade receivables  - Gross
Provision for impairment
Trade receivables – Net
Receivable days
31 December 2017 $m $m $m
Asset Solutions EAAA 625.1 (48.7) 576.4 78
Asset Solutions Americas 651.3 (24.7) 626.6 75
Specialist Technical Solutions 209.1 (12.5) 196.6 99
Environment and Infrastructure Solutions 242.8 (4.5) 238.3 124
Investment Services 69.8 (2.6) 67.2 127
Total Group 1,798.1 (93.0) 1,705.1 86



31 December 2016
Asset Solutions EAAA 334.9 (12.1) 322.8 86
Asset Solutions Americas 387.0 (11.9) 375.1 69
Specialist Technical Solutions 63.9 (0.7) 63.2 85
Total Group 785.8 (24.7) 761.1 77

Receivable days are calculated by allocating the closing trade receivables balance to current and prior period revenue.  A receivable days calculation of 86 indicates that closing trade receivables represent the most recent 86 days of revenue.

A provision for the impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the terms of the original receivables.

The ageing of the provision for impairment of trade receivables is as follows:

2017 2016
$m $m
Up to 3 months 1.1 1.9
Over 3 months 91.9 22.8
93.0 24.7

The movement on the provision for impairment of trade receivables is as follows:

2017 Asset Solutions EAAA
$m
Asset Solutions Americas
$m
Specialist
Technical
Solutions
 $m
Environment & Infrastructure Solutions
$m

Investment Services
 $m


Total
$m
At 1 January 12.1 11.9 0.7 - - 24.7
Exchange movements 1.4 - 0.1 - - 1.5
Acquisitions 39.0 19.5 15.7 4.3 2.5 81.0
Provided during year 0.7 0.1 0.9 0.6 0.2 2.5
Released during year (4.5) (6.8) (4.9) (0.4) (0.1) (16.7)
At 31 December 48.7 24.7 12.5 4.5 2.6 93.0

   

2016
At 1 January 8.7 27.0 3.9 - - 39.6
Exchange movements (1.5) - (0.1) - - (1.6)
Provided during year 5.3 0.4 - - - 5.7
Released during year (0.4) (15.5) (3.1) - - (19.0)
At 31 December 12.1 11.9 0.7 - - 24.7

   

The other classes within trade and other receivables do not contain impaired assets.

Included within gross trade receivables of $1,798.1m above (2016: $785.8m) are receivables of $581.0m (2016: $160.4m) which were past due but not impaired.  These relate to customers for whom there is no recent history or expectation of default.  The ageing analysis of these trade receivables is as follows:

2017 2016
$m $m
Up to 3 months overdue 365.3 82.8
Over 3 months overdue 215.7 77.6
581.0 160.4

The above analysis excludes retentions relating to contracts in progress of $118.5m (2016: nil).


13  Cash and cash equivalents

2017 2016
$m $m
Cash at bank and in hand 1,205.5 579.5
Short-term bank deposits 20.0 -
1,225.5 579.5

Cash at bank and in hand at 31 December 2017 includes $533.4m (2016: $420.3m) that is part of the Group’s cash pooling arrangements. For internal reporting this amount is netted with short-term overdrafts and presented as a net figure on the Group’s balance sheet. However, in preparing these financial statements, the Group has grossed up both its cash and borrowings figures by this amount.

The effective interest rate on short-term deposits at 31 December 2017 was 1.62% and these deposits have an average maturity of 13 days.

At 31 December 2017, the Group held $20.6m of cash in Angolan kwanza.  Due to the lack of US dollars in country the Group has experienced challenges in converting its kwanza cash balances and repatriating funds. During January 2018, the value of the kwanza was devalued by around 30% against the US dollar and further devaluation of the currency is forecast during 2018. The Group will continue to explore opportunities to repatriate this cash however the devaluation of the cash balance will have an impact on the Group’s 2018 profits.


14  Trade and other payables

2017 2016
$m $m
Trade payables 792.6 187.3
Gross amounts due to customers
Other tax and social security payable
465.7
74.5
-
21.7
Accruals and deferred income 612.1 341.8
Deferred and contingent consideration  (see note 17) 36.8 26.4
Finance leases 18.6 -
Derivative financial instruments 11.8 2.1
Other payables 435.5 9.7
2,447.6 589.0

Gross amounts due to customers included above represent payments on account received in excess of amounts due from customers on long term contracts.

Accruals and deferred income includes amounts due to suppliers and sub-contractors that have not yet been invoiced, unpaid wages, salaries and bonuses.

Other payables includes contract provisions, payroll related liabilities and asbestos related payables (see note 18).

Deferred and contingent consideration represents amounts payable on acquisitions made by the Group. The amount included in the table above is expected to be paid within one year from the balance sheet date.


15  Borrowings

2017 2016
$m $m
Bank loans and overdrafts due within one year or on demand
Unsecured 543.2 433.6
Non-current bank loans
Unsecured 1,961.1 120.0
Senior loan notes
Unsecured 375.0 375.0
Total non-current borrowings 2,336.1 495.0
Borrowings of $533.4m (2016: $420.3m) that are part of the Group’s cash pooling arrangements and are netted against cash for internal reporting purposes are grossed up in the short term borrowings figure above.

Bank overdrafts are denominated in a number of currencies and bear interest based on LIBOR or the relevant foreign currency equivalent.

The Group entered into new banking facilities on the acquisition of Amec Foster Wheeler. Total facilities of $2.75bn comprise a 5 year $1.75bn revolving credit facility and a $1bn 3 year term loan.

The Group has $375.0m of unsecured senior loan notes issued in the US private placement market. The notes mature in 2021, 2024 and 2026 and interest is payable at an average fixed rate of 3.74%. Of the total non-current borrowings of $2,336.1m, $213.5m is denominated in sterling with the balance in US dollars.

The effective interest rates on the Group’s bank loans and overdrafts at the balance sheet date were as follows:
2017 2016
% %
US dollar 2.58 1.55
Sterling 1.80 0.85
Euro 1.15 0.60
Canadian dollar - 2.70
Australian dollar 2.38 2.45
Norwegian kroner 1.08 1.53
Saudi Riyals - 4.83
The carrying amounts of the Group’s borrowings are denominated in the following currencies:
2017 2016
$m $m
US Dollar 2,284.9 649.1
Sterling 478.1 162.8
Euro 8.1 4.1
Canadian dollar - 20.0
Australian dollar 88.2 69.0
Norwegian kroner 14.6 19.3
Other 5.4 4.3
2,879.3 928.6

The Group is required to issue trade finance instruments to certain customers.  These include tender bonds, performance bonds, retention bonds, advance payment bonds and standby letters of credit.  At 31 December 2017, the Group’s bank facilities relating to the issue of bonds, guarantees and letters of credit amounted to $1,831.3m (2016:  $546.7m).  At 31 December 2017, these facilities were 54% utilised (2016: 33%).

Borrowing facilities

The Group has the following undrawn borrowing facilities available at 31 December:

2017 2016
$m $m
Expiring within one year 143.5 100.0
Expiring between two and five years 692.0 830.0
835.5 930.0

All undrawn borrowing facilities are floating rate facilities.  The facilities expiring within one year are annual facilities subject to review at various dates during 2018.  The Group entered into new banking facilities on the acquisition of Amec Foster Wheeler. Total facilities of $2.75bn comprise a 5 year $1.75bn revolving credit facility and a $1bn 3 year term loan. The Group was in compliance with its bank covenants throughout the year.


16  Other non-current liabilities

2017 2016
$m $m
Deferred and contingent consideration  (see note 17) 24.4 66.3
Finance leases 31.4 -
Other payables 256.5 107.0
312.3 173.3

Deferred and contingent consideration represents amounts payable on acquisitions made by the Group. The amount included in the table above is expected to be paid between one and three years from the balance sheet date.

Other payables include $83.8m relating to the US SERP pension arrangement referred to in note 30 and unfavourable leases of $115.0m.


17  Financial instruments

The Group’s activities give rise to a variety of financial risks: market risk (including foreign exchange risk and cash flow interest rate risk), credit risk and liquidity risk.  The Group’s overall risk management strategy is to hedge exposures wherever practicable in order to minimise any potential adverse impact on the Group’s financial performance.

Risk management is carried out by the Group Treasury department in line with the Group’s Treasury policies. Group Treasury, together with the Group’s business units identify, evaluate and where appropriate, hedge financial risks.  The Group’s Treasury policies cover specific areas, such as foreign exchange risk, interest rate risk, use of derivative financial instruments and investment of excess cash.

Where the Board considers that a material element of the Group’s profits and net assets are exposed to a country in which there is significant geo-political uncertainty a strategy is agreed to ensure that the risk is minimised.

 (a)          Market risk

(i)            Foreign exchange risk

The Group is exposed to foreign exchange risk arising from various currencies.  The Group has subsidiary companies whose revenue and expenses are denominated in currencies other than the US dollar.  Where possible, the Group's policy is to eliminate all significant currency exposures at the time of the transaction by using financial instruments such as forward currency contracts.  Changes in the forward contract fair values are booked through the income statement, except where hedge accounting is used in which case the change in fair value is recorded in equity.

Hedging of foreign currency exchange risk – cash flow hedges

The notional contract amount, carrying amount and fair values of forward contracts and currency swaps designated as cash flow hedges at the balance sheet date are shown in the table below.




 

2017
Notional
contract
amount
$m

2016
Notional
contract
amount
$m
2017
Carrying
amount and
fair value
$m
2016
Carrying
amount and
fair value
$m
Current assets 157.9 - 5.4 -
Current liabilities (36.4) - (0.9) -

A net foreign exchange gain of $0.7m (2016: nil) was recognised in the hedging reserve as a result of fair value movements on forward contract and currency swaps designated as cash flow hedges.

Hedging of foreign currency exchange risk – fair value through income statement

The notional contract amount, carrying amount and fair value of all other forward contracts and currency swaps at the balance sheet date are shown in the table below.




 

2017
Notional
contract
amount
$m

2016
Notional
contract
amount
$m
2017
Carrying
amount and
fair value
$m
2016
Carrying
amount and
fair value
$m
Current assets 973.8 5.4 24.5 0.1
Current liabilities (651.7) (238.7) (10.9) (1.5)

The Group’s largest foreign exchange risk relates to movements in the sterling/US dollar exchange rate.  Movements in the sterling/US dollar rate impact the translation of sterling profit earned in the UK and the translation of sterling denominated net assets. The potential impact of changes in the sterling/US dollar exchange rate is summarised in the table below. As the Group reports in US dollars a weakening of the pound has a negative impact on translation of its sterling companies’ profits and net assets.

2017 2016
$m $m
Impact of 10% increase to average £/$ exchange rate on profit after tax (4.0) 2.4
Impact of 10% increase to closing £/$ exchange rate on equity 178.1 67.1

10% has been used in these calculations as it represents a reasonable possible change in the sterling/US dollar exchange rate. The Group also has foreign exchange risk in relation a number of other currencies, such as the Australian dollar, the Canadian dollar and the Euro.

(ii)           Interest rate risk

The Group finances its operations through a mixture of retained profits and debt.  The Group borrows in the desired currencies at a mixture of fixed and floating rates of interest and then uses interest rate swaps to generate the desired interest profile and to manage the Group's exposure to interest rate fluctuations.  At 31 December 2017, 15% (2016: 53%) of the Group's borrowings were at fixed rates after taking account of interest rate swaps. The Group is also exposed to interest rate risk on cash held on deposit.  The Group’s policy is to maximise the return on cash deposits and where possible, deposit cash with a financial institution with a credit rating of ‘A’ or better.

Hedging of interest rate risk – cash flow hedges

The notional contract amount, carrying amount and fair value of interest rate swaps designated as cash flow hedges at the balance sheet date are shown in the table below.




 


2017
Hedged
amount
$m


2016
Hedged
amount
$m
2017
Carrying
amount and
fair value
$m
2016
Carrying
amount and
fair value
$m

Interest rate swaps

60.0

120.0

0.6

(0.6)

A net foreign exchange gain of $0.6m (2016: nil) was recognised in the hedging reserve as a result of fair value movements on interest rate swaps designated as cash flow hedges.

If average interest rates had been 1% higher or lower during 2017 (2016: 1%), post-tax profit for the year would have been $4.5m lower or higher respectively (2016: $0.7m).  1% has been used in this calculation as it represents a reasonable possible change in interest rates.

Immediately following the acquisition of Amec Foster Wheeler, the Group repaid AFW’s existing bank borrowings. As part of that transaction, a net payment of $21.3m was made to close out debt related derivative financial instruments.

(iii)          Price risk

The Group is not exposed to any significant price risk in relation to its financial instruments.

(b)           Credit risk

The Group’s credit risk primarily relates to its trade receivables.  Responsibility for managing credit risk lies within the businesses with support being provided by Group and divisional management where appropriate.

The credit risk associated with customers is considered as part of each tender review process and is addressed initially through contract payment terms. Trade finance instruments such as letters of credit, bonds, guarantees and credit insurance are used to manage credit risk where appropriate. Credit control practices are applied thereafter during the project execution phase. A right to interest and suspension is normally sought in all contracts. There is significant management focus on customers that are classified as high risk in the current challenging market although the Group had no material write offs in the year.

The Group’s major customers are typically large companies which have strong credit ratings assigned by international credit rating agencies.  Where a customer does not have sufficiently strong credit ratings, alternative forms of security such as the trade finance instruments referred to above may be obtained.

The Group has a broad customer base and management believe that no further credit risk provision is required in excess of the provision for impairment of trade receivables.

Management review trade receivables across the Group based on receivable days calculations to assess performance.    A table showing trade receivables and receivable days is provided in note 12.  Receivable days calculations are not provided on non-trade receivables as management do not believe that this information is a relevant metric.

The maximum credit risk exposure on cash and cash equivalents and bank deposits (more than three months) at 31 December 2017 was $1,283.2m. The Group treasury department monitors counterparty exposure on a global basis to avoid any over exposure to any one counterparty.

The Group’s policy is to deposit cash at institutions with a credit rating of ‘A’ or better where possible.  52% of cash held on deposit at 31 December 2017 was held with such institutions.

 (c)          Liquidity risk

The Group’s policy is to ensure the availability of an appropriate amount of funding to meet both current and future forecast requirements consistent with the Group’s budget and strategic plans. The Group will finance operations and growth from its existing cash resources and the $835.5m undrawn portion of the Group’s

committed banking facilities. At 31 December 2017, 100% (2016: 100%) of the Group’s principal borrowing facilities (including senior loan notes) were due to mature in more than one year.  Based on the Group’s latest forecasts the Group has sufficient funding in place to meet its future obligations.

The Group entered into new banking facilities on the acquisition of Amec Foster Wheeler. Total facilities of $2.75bn comprise a 5 year $1.75bn revolving credit facility and a $1bn 3 year term loan.

The Group has $375m of unsecured senior loan notes issued in the US private placement market. The notes mature in 2021, 2024 and 2026.

(d)           Capital risk

The Group seeks to maintain an optimal capital structure.  The Group monitors its capital structure on the basis of its gearing ratio, interest cover and when applicable, the ratio of net debt to EBITDA.

Gearing is calculated by dividing net debt by equity attributable to owners of the parent.  Gearing at 31 December 2017 was 33.2% (2016: 15.1%).

Interest cover is calculated by dividing total EBITA by net finance expense.  Interest cover for the year to 31 December 2017 was 7.0 times (2016: 14.1 times).

The ratio of net debt to pro-forma EBITDA at 31 December 2017 was 2.4 (2016: 0.8). The calculation of pro-forma EBITDA is prepared as if Amec Foster Wheeeler and CEC were acquired on 1 January 2017.

Deferred and contingent consideration

Deferred and contingent consideration is payable on the acquisition of businesses based on earn out arrangements and is initially recognised at fair value. The amount payable is dependent on the post-acquisition profits of the acquired entities and the provision made is based on the Group’s estimate of the likely profits of those entities based on the relevant Acquisition Approval Paper submitted to the Group Board. Where actual profits are higher or lower than the Group’s estimate and the amount of contingent consideration payable is consequently different to the amount estimated then the variance is charged or credited to the income statement. Where deferred and contingent consideration is payable after more than one year the estimated liability is discounted using an appropriate rate of interest. The fair value of contingent consideration is not based on observable market data and as such the valuation method is classified as level 3 as per above. The process for valuation is consistently applied to all acquisitions.

The table below presents the changes in level 3 financial instruments during the year:

Contingent consideration arising from business combinations $m
At 1 January 92.7
Exchange movements 1.8
Amounts provided in relation to new acquisitions 14.0
Interest relating to discounting of contingent consideration 2.3
Payments during the year (32.1)
Amounts released to the income statement (17.5)
At 31 December 61.2

Financial liabilities

The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period from the balance sheet date to the contractual maturity date.  The amounts disclosed in the table are the contractual undiscounted cash flows.  Drawdowns under the bilateral bank facilities are for periods of three months or less and therefore loan interest payable is excluded from the amounts below.



At 31 December 2017
Less than 1 year
$m
Between 1 and 2 years
$m
Between 2 and 5 years $m Over
5 years

$m
Borrowings 557.2 14.0 2,077.2 327.6
Trade and other payables 2,373.1 - - -
Other non-current liabilities - 224.5 88.8 -
At 31 December 2016
             
Borrowings 447.6 14.0 238.6 339.1
Trade and other payables 567.3 - - -
Other non-current liabilities - 76.6 100.4 -

Fair value of non-derivative financial assets and financial liabilities

The fair value of short-term borrowings, trade and other payables, trade and other receivables, financial assets, short-term deposits and cash at bank and in hand approximates to the carrying amount because of the short maturity of interest rates in respect of these instruments.  Drawdowns under long-term bank facilities are for periods of three months or less and as a result, book value and fair value are considered to be the same.

Fair values (excluding the fair value of assets and liabilities classified as held for sale) are determined using observable market prices (level 2 as defined by IFRS 13 ‘Fair Value Measurement’) as follows:

The Group determines whether transfers have occurred between levels in the hierarchy by reassessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. During the year ended 31 December 2017 and 31 December 2016, there were no transfers into or out of level 2 fair value measurements.


18  Provisions


Asbestos related litigation

Project and environmental litigation
Obligations relating to disposed businesses

Other provisions



Total
$m $m $m $m $m
At 1 January 2017 - - 8.1 62.5 70.6
Acquired 514.9 146.5 88.2 72.8 822.4
Exchange movements 17.1 3.5 3.5 5.1 29.2
Utilised (15.0) (1.1) (1.9) (27.2) (45.2)
Charge to income statement 0.2 - 0.6 5.3 6.1
Released to income statement (0.2) (5.9) - - (6.1)
Change in discount rate (2.3) - - - (2.3)
Unwinding of discount 4.0 - - - 4.0
Reclassifications (7.1) 5.7 2.6 (14.0) (12.8)
At 31 December 2017 511.6 148.7 101.1 104.5 865.9

Asbestos related litigation

Certain of the Group’s US and UK subsidiaries are defendants in a number of asbestos related lawsuits and out of court informal claims pending in both countries. Plaintiffs claim damages for personal injury alleged to have arisen from exposure to asbestos primarily in connection with equipment allegedly manufactured by certain Group companies in the 1970’s or earlier. It is expected that these subsidiaries will be named as defendants in additional and/or similar suits and that new claims will be filed in the future. Whilst some of these claims have been and are expected to be made in the UK, the overwhelming majority have been and are expected to be made in the US.

The Group’s asbestos related liabilities were assumed on the acquisition of Amec Foster Wheeler. Management has worked with independent asbestos valuation experts to measure the asbestos related liabilities assumed. Asbestos related liabilities recognised by the Group include estimates of indemnity amounts and defence costs expected to be incurred in each year in the period to 2050, beyond which time management expects that there will no longer be a significant number of open claims. Management’s estimates are based on the following information and assumptions - the number of open claims, the forecasted number of future claims, the estimated average cost per claim by disease type (mesothelioma, lung cancer and non-malignancies), claim filings which result in no monetary payments (the ‘zero pay rate’) as well as other factors.

In recent years, certain of the Group’s subsidiaries have entered into settlement agreements calling for insurers to make lump sum payments, as well as payments over time, for use by our subsidiaries to fund asbestos-related indemnity and defence costs, and, in certain cases, for reimbursement for portions of out of pocket costs incurred. Asbestos related insurance recoveries under executed settlement agreements are recognised in trade and other receivables together with management’s best estimate of actual and probable insurance recoveries relating to the Group’s liability for pending and estimated future asbestos claims in the period to 2050. The Group’s actual insurance recoveries may be limited by future insolvencies among its insurers. The Group does not recognise insurance recoveries due from currently insolvent insurers unless they are subject to court approved settlement in liquidation proceedings.

The Group has discounted the expected future cash flows with respect to the asbestos related liabilities and the expected insurance recoveries using discount rates determined by reference to appropriate risk free market interest rates.

Asbestos related liabilities and assets recognised on the Group’s balance sheet were as follows:

2017 2016
US
$m
UK
$m
Total
$m
US
$m
UK
$m
Total
$m
Asbestos related provision
Gross provision 589.0 73.2 662.2 - - -
Effect of discounting (99.8) - (99.8) - - -
Net provision 489.2 73.2 562.4 - - -

Insurance recoveries
Gross recoveries (66.8) (68.5) (135.3) - - -
Effect of discounting 2.9 - 2.9 - - -

Net recoveries

(63.9)

(68.5)

(132.4)

-

-

-

Net asbestos related liabilities

425.3

4.7

430.0

-

-

-

The net asbestos provision of $562.4m (2016: nil) is made up of $511.6m included in provisions (2016: nil) and $50.8m (2016: nil) in respect of asbestos liabilities included in trade and other payables.

Estimation of asbestos related liabilities and insurance recoveries is subject to a number of uncertainties that may result in significant changes to the current estimates. Among these are uncertainties as to the ultimate number and type of claims filed, the amounts of claim costs, the impact of bankruptcies of other companies with asbestos claims, uncertainties surrounding the litigation process from jurisdiction to jurisdiction and from case to case, as well as potential legislative changes. Fluctuations in market interest rates and the uncertainties noted above could cause significant changes in the discounted amount of the asbestos related liabilities and insurance recoveries.

Project and environmental litigation

The Group is party to litigation involving clients and sub-contractors arising out of project contracts. Management has taken internal and external legal advice in considering known or reasonably likely legal claims and actions by and against the Group. Where a known or likely claim or action is identified, management carefully assesses the likelihood of success of the claim or action. Generally, a provision is recognised only in respect of those claims or actions where management consider it is probable that a settlement will be required. Additionally, however, the Group recognises provisions for known or likely claims against an acquired business if, at the acquisition date, it is possible that the claim or action will be successful and its amount can be reliably estimated.

Provision is made for management’s best estimate of the likely settlement costs and/or damages to be awarded for those claims and actions that management considers are likely to be successful. Due to the inherent commercial, legal and technical uncertainties in estimating project claims, the amounts ultimately paid or realised by the Group could differ materially from the amounts that are recognised in the financial statements. An estimate of future legal costs is included only in the litigation provision acquired from Amec Foster Wheeler as on a fair value basis it is reasonable to include this as it reflects what would be paid by a third party to assume the liability.

Chemical Plant Litigation in the United States

In 2013, one of Amec Foster Wheeler plc’s subsidiaries contracted to engineer, procure and construct a chemical plant for a client in Texas. In December 2015 the client partially terminated the contract and in September 2016, terminated the remainder of the contract and commenced a lawsuit in Texas against the subsidiary and also Amec Foster Wheeler plc, seeking damages for breach of contract and warranty, gross negligence, and fraud. The claim amount is unspecified but the client alleges that the projected cost for the assigned scope of work is approximately $700 million above the alleged estimate and that the subsidiary’s delays have caused it to suffer continuing monthly damages of $25 million due to the fact that the facility is not complete and it is not able to sell the expected products from the facility. The client seeks recovery of actual and punitive damages, as well as the disgorgement of the full project fixed fee paid to the subsidiary (approximately $66.5 million).

The Group believes that the claims lack legal and factual merit. The estimate that the subsidiary provided was in connection with the client’s initial request for a lump sum bid and highly conditioned. The contract that was ultimately signed, and which governs the dispute, is a reimbursable cost plus fixed fee contract, with no guaranteed price or schedule, wherein the client assumed joint responsibility for management of the work and development of the project schedule. Liability for consequential damages is barred, except in the case of wilful misconduct. Except for gross negligence, wilful misconduct, and warranty claims, overall liability is capped at 10 percent of the contract price (or approximately $100 million). Amec Foster Wheeler has denied the claims and intend to vigorously defend the lawsuit. The lawsuit is in the early stages of proceedings and it would be premature to predict the ultimate outcome of the matter. The Group has a provision of $73.5m as at 31 December 2017 on this project against disallowed costs and warranties, which includes $35.5m of estimated legal fees included as a fair value adjustment on the acquisition of Amec Foster Wheeler.

Environmental litigation

Certain of the jurisdictions in which the Group operates, in particular the US and the EU, have environmental laws under which current and past owners or operators of property may be jointly and severally liable for the costs of removal or remediation of toxic or hazardous substances on or under their property, regardless of whether such materials were released in violation of law and whether the operator or owner knew of, or was responsible for, the presence of such substances. Largely as a consequence of the acquisition of Amec Foster Wheeler, the Group currently owns and operates, or owned and operated, industrial facilities. It is likely that, as a result of the Group’s current or former operations, hazardous substances have affected the property on which those facilities are or were situated. The Group has also received and may continue to receive claims pursuant to indemnity obligations from the present owners of facilities we have transferred, which may require us to incur costs for investigation and/or remediation. As at 31 December 2017, the Group held provisions totalling $35.9m for the estimated future environmental clean-up costs in relation to industrial facilities that it no longer operates. Whilst the timing of the related cash flows is typically uncertain, the Group expects that certain of its remediation obligations may continue for up to 60 years.

Obligations related to disposed businesses

As described in note 32, the Group agreed to indemnify certain third parties relating to businesses and/or assets that were previously owned by the Group and were sold to them. As at 31 December 2017, the Group recognised indemnity provisions totalling $101.1m. Indemnity provisions principally relate to businesses that were sold by Amec Foster Wheeler prior to its acquisition by the Group.

Other provisions

At 31 December 2017, other provisions of $104.5m (2016: $62.5m) have been recognised.  This amount includes warranty provisions in respect of guarantees provided in the normal course of business relating to contract performance. It is expected that any payment required in respect of these provisions would be made within two years.

Included within the reclassifications line is $13.4m of unfavourable leases which the Group had previously included within other provisions but are now shown in other non-current liabilities.


19  Deferred tax

Deferred tax is calculated in full on temporary differences under the liability method using the tax rate applicable to the territory in which the asset or liability has arisen. The UK rate of corporation tax, currently 19%, will reduce to 17% in April 2020.  The Group has provided deferred tax in relation to UK companies at 18% (2016: 19.5%).  The movement on the deferred tax account is shown below:

2017 2016
$m $m
At 1 January (86.6) (56.5)
Exchange movements 1.7 (2.7)
Credit to income statement (note 5) (58.1) (8.5)
Acquisitions (note 28) 219.7 -
Deferred tax relating to R&D credits (13.0) (11.2)
Deferred tax relating to retirement benefit liabilities (0.7) (2.8)
Deferred tax relating to share option schemes 5.8 (4.9)
Impact of rate change in equity 4.2 -
At 31 December 73.0 (86.6)
Deferred tax is presented in the financial statements as follows:
Deferred tax assets (108.5) (91.3)
Deferred tax liabilities 181.5 4.7
Net deferred tax liability/(asset) 73.0 (86.6)

$48.1m (2016: $9.8m) of deferred tax is recognised on the unremitted earnings of overseas subsidiaries and joint ventures as it is anticipated that distributions will be made in the foreseeable future. We expect all other earnings to be continually reinvested by the Group. There is no tax expected to be payable on them in the foreseeable future and as a result no deferred tax is provided.

Recognition of $85.9m of deferred tax assets in relation to the US tax group is based on forecast profits of the US businesses.

The Group has unrecognised tax losses of $5,824.6m (2016: $164.3m) to carry forward against future taxable income. Tax losses are recognised where there is reasonable certainty that they can be utilised in future years.

Deferred tax assets and liabilities are only offset where there is a legally enforceable right of offset and there is an intention to settle the balances net.

At 31 December 2017, the expiry dates of unrecognised deferred tax assets carried forward are as follows:


Tax losses
Deductible temporary differences

Total
$m $m $m
Expiring within 5 years 1,907.0 62.8 1,969.8
Expiring within 6-10 years - 271.1 271.1
Unlimited 2,962.0 621.7 3,583.7
4,869.0 955.6 5,824.6

The deferred tax balances are analysed below:-

2017 Accelerated capital allowances

Pension
Share based charges Other temporary differences

Losses


Total
$m $m $m $m $m $m

Deferred tax assets

(184.6)

(6.7)

(13.6)

217.6

(121.2)

(108.5)

Deferred tax liabilities

493.2

60.1

-

(371.8)

-

181.5
Net deferred tax (asset)/liability
308.6

53.4

(13.6)

(154.2)

(121.2)

73.0
2016

Deferred tax assets

42.3

(1.4)

(19.7)

(76.6)

(35.9)

(91.3)

Deferred tax liabilities

-

-

-

4.7

-

4.7
Net deferred tax (asset)/liability
42.3

(1.4)

(19.7)

(71.9)

(35.9)

(86.6)


20  Share based charges

The Group currently has a number of share schemes that give rise to share based charges.  These are the Executive Share Option Scheme (‘ESOS’), the Long Term Retention Plan (‘LTRP’), the Long Term Plan (‘LTP’) and the Employee Share Plan. The charge to operating profit for these schemes for the year amounted to $10.2m (2016: $10.7m). This included $0.6m relating to the roll-over of Amec Foster Wheeler awards under their Long Term Incentive Plan into Wood Group awards. In addition, an amount of $2.1m has been allocated to the acquisition consideration (see note 28).

The assumptions made in arriving at the charge for each scheme are detailed below.

ESOS and LTRP

For the purposes of calculating the fair value of the share options, a Black-Scholes option pricing model has been used.  Based on past experience, it has been assumed that options will be exercised, on average, six months after the earliest exercise date, which is four years after grant date, and there will be a lapse rate of 25% for ESOS and 20% for LTRP. The share price volatility used in the calculation of 40% is based on the actual volatility of the Group’s shares as well as that of comparable companies.  The risk free rate of return is based on the implied yield available on zero coupon gilts with a term remaining equal to the expected lifetime of the options at the date of grant.

Long Term Plan

The Group’s Long Term Plan (‘LTP’) was introduced during 2013.  There are two distinct awards made under the LTP.  Nil value share options will be awarded on the same basis as awards under the LTRP (see above).  In addition, awards to senior management are made based on achievement of performance measures, these being total shareholder return and adjusted diluted earnings per share.  Participants may be granted conditional share awards or nil cost options at the start of the cycle. Performance is measured over a three year period and up to 80% of an award may vest based on the performance over that period. The vesting of at least 20% of any award is normally deferred for a further period of at least two years.

Performance based awards

Details of the LTP awards are set out in the table below. The charge for market related performance targets has been calculated using a Monte Carlo simulation model taking account of share price volatility against peer group companies, risk free rate of return, dividend yield and the expected lifetime of the award.  Further details of the LTP are provided in the Directors’ Remuneration Report.

Cycle  5  6 7 8 9 10
Performance period 2012-14 2013-15 2014-16 2015-17 2016-18 2017-19
Fair value of awards £6.18 £7.53 £7.26 £5.95 £5.82 £8.54
Type of award Shares/options Options Options Options Options Options
Outstanding at 31/12/17 10,502 55,946 150,334 2,705,123 2,610,838 2,172,954

In addition to the awards above, 960,633 options are outstanding at 31 December 2017 in respect of awards made under the Amec Foster Wheeler Long Term Incentive Plan. These awards were converted to Wood Group awards following the acquisition of Amec Foster Wheeler on 6 October 2017. The fair value of these awards is £7.00.

The awards outstanding under cycles 5, 6 and 7 represent 20% of the award at vesting which is deferred for two years.

Further details on the LTP are provided in the Directors’ Remuneration Report.

Share options

A summary of the basis for the charge for ESOS, LTRP and LTP options is set out below together with the number of options granted, exercised and lapsed during the year.           

ESOS LTRP LTP
2017 2016 2017 2016 2017 2016
Number of participants 493 605 23 135 247 262
Lapse rate 25% 25% 20% 20% 10-20% 10-20%
Risk free rate of return on grants during year N/A N/A N/A N/A 0.07%-0.34% 0.15%-0.58%
Share price volatility 40% 40% 40% 40% 40% 40%
Dividend yield on grants during year N/A N/A N/A N/A 3.60% 3.50%
Fair value of options granted during year N/A N/A N/A N/A £4.73-£6.81 £5.79-£5.96
Weighted average remaining contractual life  4.7 years 5.5 years 0.3  years 1.2 years 2.5 years 2.3 years
Options outstanding 1 January 3,850,154 5,308,594 482,062 1,106,986 1,800,364 1,421,864
Options granted during the year - - - - 728,736 530,228

Options exercised during the year

(487,873)

(1,013,892)

(395,739)

(548,278)

(355,906)

(42,575)
Options lapsed during the year (336,008) (444,548) (12,376) (76,646) (159,621) (109,153)
Dividends accrued on options - - - - 22,480 -
Options outstanding 31 December 3,026,273 3,850,154 73,947 482,062 2,036,053 1,800,364
No. of options exercisable at 31 December
2,189,367

1,835,482

73,947

48,875

7,500

-
Weighted average share price of options exercised during year
£8.14

£7.21

£7.52

£6.52

£7.30

£6.92

Executive Share Option Schemes

The following options to subscribe for new or existing shares were outstanding at 31 December:


Year of Grant
Number of ordinary shares under option Exercise price
 
2017 2016    (per share) Exercise period
2007 - 15,000 268½p 2011-2017
2008 25,000 37,000 381¾p 2012-2018
2009 178,750 239,200 222p 2013-2019
2010 247,114 352,114 377½p 2014-2020
2011 325,440 484,340 529½p 2015-2021
2012 508,446 707,828 680½p 2016-2022
2013 904,617 1,077,481 845?p 2017-2023
2013 - 4,000 812p 2017-2023
2014 836,906 933,191 767?p 2018-2024
3,026,273 3,850,154

Share options are granted at an exercise price equal to the average mid-market price of the shares on the three days prior to the date of grant.

Long Term Retention Plan

The following options granted under the Group’s LTRP were outstanding at 31 December:

Year of Grant Number of ordinary shares under option Exercise price
2017 2016 (per share) Exercise period
2012 - 48,875 42/7p 2016-2017
2013 73,947 433,187 42/7p 2017-2018
73,947 482,062

Options are granted under the Group’s LTRP at par value. There are no performance criteria attached to the exercise of options under the LTRP.

Nil value share options

The following options granted under the Group’s LTP were outstanding at 31 December:

Year of Grant Number of ordinary shares under option Exercise price
2017 2016 (per share) Exercise period
2013 7,500 11,500 0.00p 2017-2018
2014 639,292 705,575 0.00p 2018-2019
2015 43,002 330,769 0.00p 2017-2018
2015 163,645 222,292 0.00p 2019-2020
2016 235,228 235,228 0.00p 2018-2019
2016 237,083 295,000 0.00p 2020-2021
2017 190,303 - 0.00p 2019-2020
2017 520,000 - 0.00p 2021-2022

2,036,053

1,800,364

Options are granted under the Group’s LTP at nil value.  There are performance criteria relating to the creation of the pool available but none relating to the exercise of the options.  Further details on the LTP are provided in the Directors’ Remuneration Report.

Employee share plan

The Group introduced an Employee Share Plan during 2016. Under the plan employees contribute regular monthly amounts which are used to purchase shares over a one year period. At the end of the year, the participating employees are awarded one free share for every three shares purchased, providing they remain in employment for a further year. It is estimated that 183,999 shares will be awarded at the end of the first year of the scheme.

Amec Foster Wheeler also has an Employee Share Plan. Awards under this scheme were converted to Wood Group awards following the acquisition on 6 October 2017. At 31 December 2017, 1,099,016 options were outstanding under this scheme.


21  Share capital

Ordinary shares of 42/7 pence each (2016: 42/7 pence) 2017 2016
Issued and fully paid shares $m shares $m
At 1 January 381,025,384 23.9 378,875,384 23.8
Allocation of new shares to employee share trusts 2,150,000 0.1 2,150,000 0.1
Shares issued in relation to acquisition of Amec Foster Wheeler
294,510,217

16.5

-

-
Shares issued to satisfy option exercises 6,695 - - -
At 31 December 677,692,296 40.5 381,025,384 23.9

On 6 October 2017, 294,510,217 new shares were issued in relation to the acquisition of Amec Foster Wheeler. The value of the consideration for these shares was $2,807.3m with $16.5m being credited to share capital and the balance to the merger reserve (see note 24). The total consideration for Amec Foster Wheeler was $2,809.4m.


22  Share premium

2017 2016
$m $m

At 1 January

63.9

63.9
Allocation of new shares to employee share trusts - -
At 31 December 63.9 63.9

The shares allocated to the trust during the year were issued at 42/7 pence (2016: 42/7 pence).


23  Retained earnings

2017 2016
$m $m
At 1 January 2,098.0 2,162.4
(Loss)/profit for the year attributable to owners of the parent (32.4) 27.8
Dividends paid (note 6) (125.6) (116.0)
Credit relating to share based charges (note 20) 10.2 10.7
Share based charges allocated to AFW purchase consideration 2.1 -
Re-measurement loss on retirement benefit liabilities (note 30) (1.2) (14.2)
Movement in deferred tax relating to retirement benefit liabilities 0.7 2.8
Shares allocated to employee share trusts (0.1) (0.1)
Shares disposed of by employee share trusts 2.4 7.5
Gain on sale of shares sold by employee share trusts 3.2 -
Tax relating to share option schemes (4.2) 6.4
Deferred tax impact of rate change in equity (4.0) -
Exchange movements in respect of shares held by employee share trusts (9.9) 20.9
Transactions with non-controlling interests (4.0) (10.2)

At 31 December

1,935.2

2,098.0

Retained earnings are stated after deducting the investment in own shares held by employee share trusts.  No options have been granted over shares held by the employee share trusts (2016: nil).

Shares held by employee share trusts

2017 2016
Shares $m Shares $m
Balance 1 January 9,097,352 105.5 8,985,323 133.8
New shares allocated 2,150,000 0.1 2,150,000 0.1
Shares issued to satisfy option exercises (1,239,518) (2.3) (1,604,745) (7.5)
Shares issued to satisfy awards under Long Term Incentive Plan
(478,611)

-

(430,818)

-
Shares issued to satisfy awards under Employee Share Plan
(436)

-

(2,408)

-
Sale of shares by JWG Trustees Ltd (421,000) (0.1) - -
Exchange movement - 9.9 - (20.9)
Balance 31 December 9,107,787 113.1 9,097,352 105.5

Shares acquired by the employee share trusts are purchased in the open market using funds provided by John Wood Group PLC to meet obligations under the Employee Share Option Schemes, LTRP and LTP. Shares are allocated to the employee share trusts in order to satisfy future option exercises at various prices.

The costs of funding and administering the trusts are charged to the income statement in the period to which they relate.  The market value of the shares at 31 December 2017 was $80.1m (2016: $98.5m) based on the closing share price of £6.50 (2016: £8.76).  The employee share trusts have waived their rights to receipt of dividends on ordinary shares.     

In December 2017, 421,000 shares held by JWG Trustees Ltd were sold for a total consideration of $3.3m. The cost of these shares was $0.1m and the gain on disposal of $3.2m has been credited to retained earnings in the period.

The amount of John Wood Group PLC’s reserves that are considered distributable is disclosed in note 12 to the Company Financial Statements.


24  Merger reserve

2017 2016
$m $m

At 1 January

-

-
Shares issued in relation to acquisition of Amec Foster Wheeler 2,790.8 -
At 31 December 2,790.8 -

On 6 October 2017, 294,510,217 new shares were issued in relation to the acquisition of Amec Foster Wheeler. As the acquisition resulted in the Group securing 90% of Amec Foster Wheeler’s share capital, the acquisition qualifies for merger relief under section 612 of the Companies Act 2006 and the premium arising on the issue of the shares is credited to a merger reserve rather than the share premium account. The total value of the consideration for Amec Foster Wheeler was $2,809.4m with $16.5m being credited to share capital, $2,790.8m to the merger reserve and $2.1m to retained earnings.


25  Other reserves    

Capital reduction reserve Capital redemption reserve Currency translation reserve
Hedging reserve


Total
$m $m $m $m $m
At 1 January 2016 88.1 439.7 (378.6) (1.0) 148.2
Exchange movement on retranslation of foreign currency net assets
-

-

(138.8)

-

(138.8)
At 31 December 2016 88.1 439.7 (517.4) (1.0) 9.4
Cash flow hedges - - - 1.3 1.3
Exchange movement on retranslation of foreign currency net assets
-

-

119.2

-

119.2
At 31 December 2017 88.1 439.7 (398.2) 0.3 129.9

The capital reduction reserve was created subsequent to the Group’s IPO in 2002 and is a distributable reserve.

The capital redemption reserve was created following a share issue that formed part of the return of cash to shareholders in 2011. This is not a distributable reserve.

The currency translation reserve relates to the retranslation of foreign currency net assets on consolidation.  This was reset to zero on transition to IFRS at 1 January 2004.  The movement during the year relates to the retranslation of foreign currency net assets, including goodwill and intangible assets recognised on acquisition.

The hedging reserve relates to the accounting for derivative financial instruments under IAS 39.  Fair value gains and losses in respect of effective cash flow hedges are recognised in the hedging reserve.


26  Non-controlling interests

2017 2016
$m $m

At 1 January

13.0

22.7
Exchange movements - (0.3)
Acquired 1.2 -
Share of profit for the year 2.4 6.6
Dividends paid to non-controlling interests (4.5) (6.7)
Transactions with non-controlling interests (0.4) (9.3)

At 31 December

11.7

13.0

The Group paid $3.9m to acquire minority shareholdings during the year. The $0.4m in the above table represents the share of net assets acquired and the excess has been recorded against retained earnings.


27  Cash generated from operations

2017 2016
Note $m $m
Reconciliation of operating profit to cash generated from operations:
Operating profit from continuing operations 36.4 89.4
Less share of post-tax profit from joint ventures (31.3) (3.4)
5.1 86.0
Adjustments for:
Depreciation 9 41.8 46.1
Gain on disposal of property plant and equipment 3 (1.3) (4.7)
Impairment of property plant and equipment 9 2.7 -
Amortisation of intangible assets 8 139.4 102.3
Share based charges 20 10.2 10.7
Decrease in provisions 18 (75.8) (43.8)
Dividends from joint ventures 10 32.0 25.4
Exceptional items - non cash impact 1,4 99.8 99.9
Changes in working capital (excluding effect of acquisition and divestment of subsidiaries)
(Increase)/decrease in inventories (0.4) 0.9
Decrease in receivables 287.3 98.3
Decrease in payables (302.9) (179.6)
Exchange movements 12.1 3.6
Cash generated from operations 250.0 245.1

Analysis of net debt

At 1 January 2017
$m


Acquired
$m


Cash flow
$m

Exchange movements
$m
At 31 December 2017
$m
Short-term borrowings (note 15) (433.6) - (108.2) (1.4) (543.2)
Finance leases (notes 14 and 16)
Long-term borrowings (note 15)
-
(495.0)
(49.5)
-
(0.5)
(1,831.0)
-
(10.1)
(50.0)
(2,336.1)

 

(928.6)

(49.5)

(1,939.7)

(11.5)

(2.929.3)
Cash and cash equivalents (note 13) 579.5 - 642.1 3.9 1,225.5
Restricted cash (note 12) 26.5 - - - 26.5
Bank deposits (more than three months) (note 12)
-

30.1

-

1.1

31.2
Net debt (322.6) (19.4) (1,297.6) (6.5) (1,646.1)

The cash flow column in the table above includes cash and borrowings of $447.5m and $1,809.7m respectively acquired on the acquisitions of Amec Foster Wheeler and CEC (see note 28).


28  Acquisitions and divestments

On 6 October 2017, the Group acquired 100% of the share capital of Amec Foster Wheeler plc. The acquisition was completed through the issue of 294,510,217 new Wood Group shares for a value of $2,807.3m. In addition, $2.1m relating to share awards to Amec Foster Wheeler employees was allocated to the purchase consideration.

The assets and liabilities acquired in respect of the Amec Foster Wheeler acquisition were as follows:


 

Provisional
Acquired balance sheet
$m
Property, plant and equipment 83.4
Intangible assets recognised on acquisition 1,343.6
Other intangible assets 35.1
Investment in joint ventures
Retirement benefit schemes surplus
Long term receivables
Inventories
55.5
147.3
167.3
6.7
Trade and other receivables
Assets held for sale
1,861.4
582.6
Bank deposits (more than 3 months) 30.1
Cash and cash equivalents 443.7
Borrowings (1,809.7)
Finance leases (49.5)
Trade and other payables (1,902.8)
Liabilities held for sale
Current tax
(326.2)
(149.1)
Deferred tax (219.7)
Provisions (822.4)
Non-current liabilities (181.2)
Total identifiable net liabilities acquired (703.9)

Non-controlling interests

(1.2)

(705.1)
Goodwill 3,514.5

Consideration

2,809.4
Consideration satisfied by:
Issue of shares 2,807.3
Share based charges allocated to consideration 2.1
2,809.4

The acquisition of Amec Foster Wheeler accelerates the Group’s strategy, increases the range of customer relationships, facilitates development of technology enabled solutions and broadens end market, geographic and customer exposure. It will provide enhanced capability and diversification across oil and gas, chemicals, renewables, environmental and infrastructure and mining segments. These factors contribute to the goodwill recognised on acquisition. Amec Foster Wheeler’s skilled workforce did not meet the criteria for recognition as an intangible asset at the date of acquisition and thus also contributed to the goodwill recognised.

The accounting for the acquisition is provisional and will be finalised in the next accounting period.

Intangible assets of $1,343.6m, representing the fair value of customer relationships, order backlog and brands have been recorded in relation to the acquisition. Deferred tax liabilities of $261.5m have been recognised in relation to intangible assets.

Fair value adjustments of $104.5m have been made to the acquisition balance sheet. This amount includes $37.1m of additional contract liabilities, $42.6m of anticipated legal fees to defend claims against the Group, $19.1m of additional insurance captive liabilities in order to align with Wood Group policy and $5.7m of other adjustments. In addition, an adjustment of $57.5m has been recorded to align Amec Foster Wheeler’s revenue recognition policy on lump sum contracts with Wood Group’s policy and $49.4m of additional tax provisions have also been recorded.

The Group has used acquisition accounting for the purchase of Amec Foster Wheeler and, in accordance with the Group’s accounting policies, the goodwill arising on consolidation of $3,514.5m has been capitalised.

The adjusted trade and other receivables acquired of $1,861.4m, net of provisions, are expected to be recovered in full. Gross trade and other receivables acquired, before provisions and fair value adjustments amounted to $1,974.2m. Long term receivables acquired amounted to $167.3m.

In May 2017, the Group acquired 100% of the share capital of CEC Controls Inc (‘CEC’), a designer and builder of industrial and process control systems for the automotive manufacturing industry based in Detroit, USA.

The assets and liabilities acquired in respect of the CEC acquisition were as follows:

$m
Property, plant and equipment 0.4
Intangible assets recognised on acquisition 12.3
Trade and other receivables 19.6
Cash and cash equivalents 3.8
Trade and other payables (6.6)
Total identifiable net assets acquired 29.5
Goodwill 38.8

Consideration

68.3
Consideration satisfied by:
Cash 54.3
Deferred and contingent consideration 14.0

68.3

Contingent consideration has been provided in relation to the CEC acquisition and is payable over the next 3 years. The amount payable is dependent on post-acquisition profits and the provision made is based on the Group’s estimate of the likely profits of the entity. Where deferred consideration is payable after more than one year the estimated liability is discounted using an appropriate rate of interest.

The acquisition of CEC gives that company access to the Group’s wider client base and use of the Group’s resources to further grow and develop its businesses contributing to the goodwill recognised on the acquisition.

The Group has used acquisition accounting for the purchase of CEC and, in accordance with the Group’s accounting policies, the goodwill arising on consolidation of $38.8m has been capitalised.

Intangible assets of $12.3m, representing the fair value of customer contracts and relationships, have been recorded in relation to the acquisition of CEC. Trade and other receivables acquired of $19.6m are expected to be recovered in full. The accounting for the acquisition will be finalised in the next accounting period.

Acquisition costs incurred during the year are included in administrative expenses in the income statement (see note 4).

The inflow of cash and cash equivalents in respect of acquisitions is analysed as follows:

$m
Cash consideration for acquisitions in year (54.3)
Cash consideration relating to acquisitions in prior periods (33.4)
Cash acquired 447.5
Net cash inflow 359.8

Borrowings of $1,809.7m were acquired on the acquisition of Amec Foster Wheeler.

Contingent consideration payments of $32.1m and a top-up payment of $1.3m were made during the year in respect of acquisitions made in prior periods. Total deferred and contingent consideration outstanding at 31 December amounted to $61.2m (2016: $92.7m). See note 17 for further details.

The pro-forma results of the Group, on the basis that Amec Foster Wheeler was acquired on 1 January 2017 are presented in the Financial Review in the Group’s Annual Report. The figures for the pre-acquisition period have been extracted from the management accounts of Amec Foster Wheeler, are unaudited and show Group revenue of $9,884.8m and EBITA of $597.7m for the year ended 31 December 2017.

From the date of acquisition to 31 December 2017, Amec Foster Wheeler contributed $1,435.5m to revenue and $96.1m to EBITA and CEC contributed $42.7m to revenue and $7.2m to EBITA.

Divestments

On 27 October 2017, the Group disposed of Amec Foster Wheeler’s UK upstream oil and gas business for a gross consideration of $299.0m. This divestment was one of the conditions agreed with the UK competition authorities to enable the Group to proceed with the Amec Foster Wheeler acquisition. In November 2017, the Group disposed of Amec Foster Wheeler’s North American nuclear operations for a gross consideration of $8.9m and in December 2017 the Group disposed of a small boiler business for a gross consideration of $5.2m.

On the acquisition balance sheet of Amec Foster Wheeler the assets and liabilities of these businesses were classified as held for sale.

The accounting for the disposals is shown below -:

$m
Assets held for sale 550.1
Liabilities held for sale (238.5)
Net assets divested 311.6
Gross proceeds received 313.1
Gross gain 1.5
Disposal costs (1.5)
Net gain -

The cash inflow in respect of these disposals is analysed below.

$m
Gross proceeds received 313.1
Disposal costs paid (1.5)
Cash divested (56.7)
Cash inflow 254.9


29  Employees and directors           

Employee benefits expense   2017 2016
$m $m
Wages and salaries 2,458.0 1,964.6
Social security costs 197.1 166.5
Pension costs – defined benefit schemes (note 30) 0.2 -
Pension costs – defined contribution schemes (note 30) 76.1 68.3
Share based charges (note 20) 10.2 10.7
2,741.6 2,210.1

   


Average monthly number of employees (including executive directors)

2017

2016
No. No.
By geographical area:
UK 6,972 7,169
US 11,350 10,736
Rest of the World 10,709 7,626
29,031 25,531

The average number of employees excludes contractors and employees of joint venture companies. Employees of Amec Foster Wheeler have been included for the last three months of the year.

2017 2016
Key management compensation $m $m
Salaries and short-term employee benefits 7.5 5.6
Amounts receivable under long-term incentive schemes 1.3 0.8
Social security costs 1.0 0.8
Post-employment benefits 0.2 0.3
Share based charges 1.7 1.3
11.7 8.8

Key management compensation represents the charge to the income statement in respect of the remuneration of the Group board and Group Executive Leadership Team (‘ELT’) members. Both the Group board and the ELT have been extended following the Amec Foster Wheeler acquisition. At 31 December 2017, key management held 0.2% of the voting rights of the company.

2017 2016
Directors $m $m
Aggregate emoluments 2.9 2.6
Aggregate amounts receivable under long-term incentive schemes 0.6 0.4
Aggregate gains made on the exercise of share options 0.7 0.2
Share based charges 0.6 0.6
4.8 3.8

At 31 December 2017 , two directors (2016: two) had retirement benefits accruing under a defined contribution pension plan and no directors (2016: none) had benefits accruing under a defined benefit pension scheme. Further details of directors’ emoluments are provided in the Directors’ Remuneration Report.


30  Retirement benefit schemes

The Group operates a number of defined benefit pension schemes.  The assets of the defined benefits schemes are held separately from those of the Group, being invested with independent investment companies in trustee administered funds. These schemes are largely closed to future accrual.

As well as the John Wood Group PLC Retirement Benefit Scheme, the acquisition of Amec Foster Wheeler added a number of further defined benefit schemes, the most significant of which are the Amec Foster Wheeler Pension Plan and the Foster Wheeler Inc Salaried Employees Pension Plan.

The valuations used have been based on the final valuation of the John Wood Group PLC Retirement Benefit Scheme as at 5 April 2016, the preliminary valuation of Amec Foster Wheeler Pension Plan as at 31 March 2017 and the valuation of the Foster Wheeler Inc Pension Plan as at 1 January 2017. The scheme valuations have been updated by the schemes’ actuaries for the requirement to assess the present value of the liabilities of the schemes as at 31 December 2017. The assets of the schemes are stated at their aggregate market value as at 31 December 2017.

Scheme membership at the balance sheet date was as follows –

2017 2017 2017 2016
JWG
PLC
RBS
AFW Pension Plan FW Inc Pension Plan JWG
 PLC
 RBS
Deferred members 689 9,766 1,570 724
Pensioner members 419 9,546 3,234 397

The principal assumptions made by the actuaries at the balance sheet date were:

2017 2017 2017 2016
JWG
PLC
RBS
AFW Pension
Plan
FW Inc Pension Plan JWG
PLC
RBS
% % % %
Discount rate 2.5 2.5 3.4 2.6
Rate of increase in pensions in payment and deferred pensions 3.2 2.7 N/A 3.5
Rate of retail price index inflation 3.3 3.1 N/A 3.6
Rate of consumer price index inflation 2.3 N/A N/A 2.6

The mortality assumptions used to determine pension liabilities in the three schemes at 31 December 2017 were as follows –

Scheme Mortality assumption
JWG PLC RBS S2NA mortality tables with CMI 2015 projections and a long-term rate of improvement of 1.25% pa
AFW Pension Plan Scheme specific table with CMI 2016 projections and a long-term rate of improvement of 1.25% pa
FW Inc Pension Plan RP-2014 Employee and Annuitant tables for males and females with generational projection using scale MMP-2016 with no collar adjustments

The mortality tables use data appropriate to each of the Group’s schemes adjusted to allow for expected future improvements in mortality using the latest projections. For the three schemes referred to above the assumed life expectancies are shown in the following table:

2017 2017 2017 2016
JWG
PLC
RBS
AFW Pension Plan FW Inc Pension Plan JWG
 PLC
 RBS
Life expectancy at age 65 of male aged 45 24.3 24.4 21.9 24.2
Life expectancy at age 65 of male aged 65 22.5 22.6 20.5 22.4
Life expectancy at age 65 of female aged 45 26.6 26.3 23.7 26.5
Life expectancy at age 65 of female aged 65 24.7 24.3 22.4 24.6

The amounts recognised in the income statement are as follows:

2017 2016
$m $m
Current service cost 0.2 -

Interest cost

36.2

8.8
Interest income on scheme assets (33.6) (9.0)

Total included within finance expense/(income)

2.6

(0.2)

The amounts recognised in the balance sheet are determined as follows:

2017 2016
$m $m

Present value of funded obligations

4,354.9

246.3
Fair value of scheme assets (4,522.6) (239.3)

Net (surplus)/deficit

(167.7)

7.0

Changes in the present value of the defined benefit liability are as follows:

2017 2016
$m $m

Present value of funded obligations at 1 January

246.3

249.7
Acquired
Current service cost
Interest cost
3,882.3
0.2
36.2
-
-
8.8
Re-measurements:
- actuarial losses arising from changes in financial assumptions 90.3 72.7
- actuarial losses/(gains) arising from changes in demographic assumptions 15.3 (10.9)
- actuarial losses/(gains) arising from changes in experience 15.4 (15.3)
Benefits paid (83.1) (14.8)
Settlement of unfunded liability (8.5) -
Exchange movements 160.5 (43.9)

Present value of funded obligations at 31 December

4,354.9

246.3

Changes in the fair value of scheme assets are as follows:

2017 2016
$m $m

Fair value of scheme assets at 1 January

239.3

254.2
Acquired
Interest income on scheme assets
4,029.6
33.6
-
9.0
Contributions 14.9 2.3
Benefits paid (80.9) (14.8)
Re-measurement gain on scheme assets
Actuarial movement arising from changes in financial assumptions
115.8
4.0
32.3
-
Expenses paid (2.4) -
Exchange movements 168.7 (43.7)

Fair value of scheme assets at 31 December

4,522.6

239.3

Analysis of the movement in the balance sheet (surplus)/deficit:

2017 2016
$m $m

Deficit/(surplus) at 1 January

7.0

(4.5)
Acquired
Current service cost
Finance expense/(income)
(147.3)
0.2
2.6
-
-
(0.2)
Contributions (14.9) (2.3)
Re-measurement losses recognised in the year 1.2 14.2
Benefits paid (2.2) -
Expenses paid 2.4 -
Settlement of unfunded liability (8.5) -
Exchange movements (8.2) (0.2)

(Surplus)/deficit at 31 December

(167.7)

7.0

The net (surplus)/deficit at 31 December is presented in the Group balance sheet as follows –

2017 2016
$m $m
JWG PLC Retirement Benefit Scheme (22.9) -
AFW Pension Plan (308.6) -
Retirement benefit scheme surplus (331.5) -
Foster Wheeler Inc Pension Plan 80.6 -
JWG PLC Retirement Benefit Scheme - 7.0
All other schemes 83.2 -
Retirement benefit scheme deficit 163.8 7.0
Net (surplus)/deficit (167.7) 7.0

For the three principal schemes the defined benefit obligation can be allocated to the plan participants as follows:

2017 2017 2017 2016
JWG
PLC
RBS
AFW Pension Plan FW Inc Pension Plan JWG
 PLC
 RBS
% % % %
Deferred members of the scheme 75.1 48.0 24.7 72.2
Pensioner members of the scheme 24.7 52.0 75.3 23.8
Unfunded liabilities 0.2 - - 4.0

The major categories of scheme assets as a percentage of total scheme assets are as follows:

2017 2017 2017 2016
JWG
PLC
RBS
AFW Pension Plan FW Inc Pension Plan JWG
PLC
RBS
% % % %
Equities 66.9 34.3 60.0 78.9
Property
Bonds (including gilts)
7.1
10.9
7.9
52.7
-
40.0
-
16.6
Liability driven investments
Cash
11.3
1.5
-
4.1
-
-
-
2.0
Other 2.3 1.0 - 2.5
100.0 100.0 100.0 100.0

The contributions expected to be paid during the financial year ending 31 December 2018 amount to $23.7m.


Scheme risks
The retirement benefit schemes are exposed to a number of risks, the most significant of which are –

Volatility

The defined benefit obligation is measured with reference to corporate bond yields and if scheme assets underperform relative to this yield, this will create a deficit, all other things being equal.  The scheme investments are well diversified such that the failure of a single investment would not have a material impact on the overall level of assets.

Changes in bond yields

A decrease in corporate bond yields will increase the defined benefit obligation.  This would however be offset to some extent by a corresponding increase in the value of the scheme’s bond asset holdings.

Inflation risk

The majority of benefits in deferment and in payment are linked to price inflation so higher actual inflation and higher assumed inflation will increase the defined benefit obligation.

Life expectancy

The defined benefit obligation is generally made up of benefits payable for life and so increases to members’ life expectancies will increase the defined benefit obligation, all other things being equal.

Sensitivity of the retirement benefit obligation

The impact of changes to the key assumptions on the retirement benefit obligation is shown below.  The sensitivity is based on a change in an assumption whilst holding all other assumptions constant.  In practice, this is unlikely to occur, and changes in some of the assumptions may be correlated.  When calculating the sensitivity of the defined benefit obligation to significant actuarial assumptions the same method has been applied as when calculating the pension obligation recognised in the Group balance sheet.

Approximate impact on scheme liabilities JWG
 PLC
RBS
AFW
Pension
Plan
FW Inc
Pension
Plan
$m $m $m
Discount rate
Plus 0.1% (5.0) (63.3) (3.2)
Minus 0.1% 5.1 65.0 3.2
Inflation
Plus 0.1% 3.7 54.7 N/A
Minus 0.1% (3.6) (54.5) N/A
Life expectancy
Plus 1 year 6.7 130.8 12.5
Minus 1 year (6.3) (129.9) (12.5)

Defined contribution plans

Pension costs for defined contribution plans were as follows:

2017 2016
$m $m

Defined contribution plans

76.1

68.3

There were no material contributions outstanding at 31 December 2017 in respect of defined contribution plans.

The Group operates a SERP pension arrangement in the US for certain employees. During the year, the Group made contributions of $0.6m (2016: $0.6m) to the arrangement. Contributions are invested in a portfolio of US funds and the fair value of the funds at the balance sheet date are recognised by the Group as a long term receivable. Investments held by the Group at 31 December amounted to $83.8m (2016: $77.4m) and will be used to pay benefits when employees retire.  The corresponding liability is recorded in other non-current liabilities.
 

31  Operating lease commitments – minimum lease payments





Property

2017 Vehicles, plant and equipment




Property

2016 Vehicles, plant and equipment
$m $m $m $m
Amounts payable under non-cancellable operating leases due:
Within one year 171.0 5.4 79.0 9.2
Later than one year and less than five years 457.4 3.7 225.2 5.5
After five years 225.8 - 208.0 -
854.2 9.1 512.2 14.7

The Group leases various offices and facilities under non-cancellable operating lease agreements.  The leases have various terms, escalation clauses and renewal rights.  The Group also leases vehicles, plant and equipment under non-cancellable operating lease agreements.


32  Contingent liabilities

Cross guarantees

At the balance sheet date, the Group had cross guarantees without limit extended to its principal bankers in respect of sums advanced to subsidiaries.

Legal Claims

From time to time, the Group is notified of claims in respect of work carried out. Where management believes we are in a strong position to defend these claims no provision is made.

Employment claims

The Group is aware of challenges to historic employment practices which may have an impact on the Group, including the application of National Insurance Contributions to workers in the UK Continental Shelf. In addition, previous court cases have challenged the UK’s historic interpretation of EU legislation relating to holiday pay and this may have an impact on all companies who have employees in the UK, including the Group. At this point, we do not believe that it is probable that a liability, if any, will arise from any of these claims and therefore no provision has been made.

Indemnities and retained obligations

The Group has agreed to indemnify certain third parties relating to businesses and/or assets that were previously owned by the Group and were sold to them. Such indemnifications relate primarily to breach of covenants, breach of representations and warranties, as well as potential exposure for retained liabilities, environmental matters and third party claims for activities conducted by the Group prior to the sale of such businesses and/or assets. We have established provisions for those indemnities in respect of which we consider it probable that there will be a successful claim. We do not expect indemnities or retained obligations for which a provision has not been established to have a material impact on the Group’s financial position, results of operations or cash flows.

Guarantees

In 2016, one of the Group’s subsidiaries disposed of a refinery/electricity generation plant located in Chile. A condition of the disposal was that the subsidiary was required to sign an operation and maintenance contract with the purchaser.  This has resulted in a number of performance obligations with respect to refinery output and electricity generation by the plant.

Mount Polley

The Mount Polley mine is owned and operated by Mount Polley Mining Corporation, a subsidiary of Imperial Metals Corporation, and is located near the town of Likely, British Columbia, Canada. On 4 August 2014, a tailings pond facility at the mine failed releasing large quantities of water and mine tailings into the local environment. The dam was in the process of being raised (as part of its annual raise) at the time of the failure. One of Amec Foster Wheeler’s subsidiaries, along with other parties, had various design and quality assurance responsibilities associated with the development of this facility. Amec Foster Wheeler’s subsidiary was providing engineering services at the time of the breach, but did not perform the original design.

An independent review panel, appointed by the government of British Columbia, issued a report on 30 January 2015 concluding that the cause of failure was shearing along a zone of weak soil along with other contributory factors. On 17 December 2015, the chief inspector of mines for British Columbia issued a report that for the most part agreed with the conclusions of the independent review panel. Whilst the chief inspector concluded that there were failings in the required standard of care of all of the engineers, he concluded that the responsibility for the breach lies primarily with the mine owner, Mount Polley Mining Corporation. He also concluded that there was no evidence of any significant contravention of regulatory requirements.

On 4 July 2016, Mount Polley Mining Corporation and Imperial Metals Corporation filed a suit against Amec Foster Wheeler’s subsidiary and others. The claim seeks C$3 million in costs payable to government agencies and unspecified damages for loss of profit, reconstruction costs and environmental remediation. Subsequent to this filing, several tourist operators and First Nations also filed suit alleging that they suffered damages as a result of the tailings facility failure. It is Amec Foster Wheeler management’s opinion that its employees performed in a professional manner consistent with the standard of care for a competent engineer on a project of this nature in British Columbia. In addition, the contracts between Amec Foster Wheeler’s subsidiary and Mount Polley Mining Corporation contain limitation of liability provisions that exclude claims for consequential damages and limit the subsidiary’s liability to Mount Polley Mining Corporation to the amount of professional fees charged, which were less than C$1 million.

The Group has retained outside counsel and filed a response to Mount Polley Mining Corporation’s civil claim on 23 September 2016. Given the early stage of this matter, it is difficult to predict the likely outcome of this proceeding. Mindful of the foregoing caveat, it is management’s opinion that it is probable that there will be an outflow in respect of this issue (with liability shared with the other parties), but it is probable that if there is an outflow to Mount Polley Mining Corporation, it will be limited to the prescribed contractual limitation of liability referenced above.

Investigations

Amec Foster Wheeler has received voluntary requests for information from, and continues to cooperate with, the US Securities and Exchange Commission (“SEC”) and the US Department of Justice (“DOJ”) in connection with their ongoing investigations into Amec Foster Wheeler in relation to Unaoil and in relation to historical use of agents and certain other business counterparties by Amec Foster Wheeler and its legacy companies primarily in the Middle East. In addition, Amec Foster Wheeler has provided information relating to the historical use of third parties by legacy Amec Foster Wheeler companies in certain other regions to the SEC and DOJ.

Amec Foster Wheeler made a disclosure to the UK Serious Fraud Office (“SFO”) about these matters and, in April 2017, in connection with the SFO’s investigation into Unaoil, the SFO required Amec Foster Wheeler to produce information relating to any relationship of Amec Foster Wheeler with Unaoil or certain other third parties.  In July 2017, the SFO opened an investigation into Amec Foster Wheeler, predecessor companies and associated persons.  The investigation focuses on the past use of third parties and possible bribery and corruption and related offences and relates to various jurisdictions.  The Group is co-operating with and assisting the SFO in relation to this investigation.

Notifications of certain matters within the above investigations have also been made to the relevant authority in Brazil (namely, the Federal Prosecution Service).

Independently, the Group has conducted an internal investigation into the historical engagement of Unaoil by legacy Wood Group companies, reviewing information available to the Group in this context.  This internal investigation confirmed that a legacy Wood Group joint venture engaged Unaoil and that the joint venture made payments to Unaoil under agency agreements.  The Group has informed the Crown Office and Procurator Fiscal Service (“COPFS”), the relevant authority in Scotland, of the findings of the internal investigation.  The Group understands that COPFS and the SFO are, in line with the memorandum of understanding between them, liaising to consider which authority will be responsible for the matter going forward.  The Group is co-operating with and assisting the authorities in connection with this matter.

At this time it is not possible to make a reliable estimate of the liability, if any, that may arise in relation to any of the above matters and therefore no provision has been made for them in the financial statements.

Tax planning

The Group undertakes tax planning which is compliant with current legislation and accepted practice. Recent changes to the tax environment, including the OECDs project around Base Erosion and Profit Shifting have brought into question tax planning previously undertaken by multinational entities. There have been several recent high profile tax cases against tax authorities and large groups. The European Commission continues formal investigations to examine whether decisions by the tax authorities in certain European countries comply with European Union rules, and has issued judgements in some cases which are being contested by the groups and the countries effected. The Group is monitoring the outcome of these cases in order to understand whether there is any risk to the Group. Specifically the EC has challenged the UK Controlled Foreign Companies (CFC) rules in relation to an exemption for certain financing income.  Based on the Group’s current assessment of such issues, it is too early to speculate on the likelihood of liabilities arising, and as a result, it is not currently considered probable that there will be an outflow in respect of these issues.


33  Capital and other financial commitments

2017 2016
$m $m

Contracts placed for future capital expenditure not provided in the financial statements

18.5

8.1

The capital expenditure above relates to property plant and equipment.  In addition, joint venture companies have commitments amounting to $2.2m.


34  Related party transactions

The following transactions were carried out with the Group’s joint ventures.  These transactions comprise sales and purchases of goods and services and funding provided in the ordinary course of business.  The receivables include loans to joint venture companies.

2017 2016
$m $m
Sale of goods and services to joint ventures 9.5 29.6
Purchase of goods and services from joint ventures 8.1 8.5
Receivables from joint ventures 131.2 119.5
Payables to joint ventures 14.3 13.3

Key management compensation is disclosed in note 29.

The Group currently pays an annual fee of £15,000 (2016: £15,000) to Dunelm Energy, a company in which Ian Marchant, the Group Chairman, has an interest, for secretarial and administration services and the provision of office space.


35  Subsidiaries and joint ventures

The Group’s subsidiary and joint venture undertakings at 31 December 2017 are listed below.  All subsidiaries are fully consolidated in the financial statements. Ownership interests noted in the table reflect holdings of ordinary shares.

Subsidiaries
Company name Registered Address Ownership Interest
%
Algeria
SARL Wood Group Algeria Cite Zone Industrielle BP 504, Hassi Messaoud 100
Wood Group Somias SPA PO Box 67, Elmalaha Road (Route des Salines), Elbouni, Annaba 55
Angola
Production Services Network Angola Limitada RuaKima Kienda, Edificio SGEP, 2nd Floor, Apartment 16, Boavista District, Ingombota, Luanda 49*
Wood Group Kianda Limitada No 201, Rua Engenheiro Armindo de Andrade, Bairro Miramar, Simbizanga, Luanda 41*
Argentina
AGRA Argentina S.A. 25 de Mayo 596, piso 8º, C1002ABL, Buenos Aires, Argentina 100
Foster Wheeler E&C Argentina S.A. Paraguay 1866, Buenos Aires, Argentina 100
ISI Mustang (Argentina) S.A. Pedro Molina 714, Ciudad de Mendoza, Provincia de Mendoza 100
Australia
Altablue Australia Pty Ltd Wood Group House, Level 1, 432 Murray Street, Perth WA 6000 100
AMEC Australia Finance Company Pty Ltd Wood Group House, Level 1, 432 Murray Street, Perth WA 6000 100
Amec Foster Wheeler Australia Holding Company Pty Ltd Wood Group House, Level 1, 432 Murray Street, Perth WA 6000 100
Amec Foster Wheeler Australia Pty Ltd Wood Group House, Level 1, 432 Murray Street, Perth WA 6000 100
Amec Foster Wheeler BG Holdings Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Amec Foster Wheeler BG Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Amec Foster Wheeler Engineering Holdings Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Amec Foster Wheeler Engineering Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Amec Foster Wheeler Environment & Infrastructure Pty Ltd Level 4, 144 Edward Street, Brisbane, QLD, 4000, Australia 100
Amec Foster Wheeler Zektin Architecture Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Amec Foster Wheeler Zektin Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
AMEC Minproc Projects (New Zealand) Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
AMEC Zektin Group Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Aus-Ops Pty Ltd Wood Group House, Level 1, 432 Murray Street, Perth WA 6000 100
Foster Wheeler (QLD) Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Foster Wheeler (WA) Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Geosafe Australia Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Global Carbon Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRA Technology Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD Asia Holdings Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD Asia Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD Developments Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD ESAP Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD Investments Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD New Zealand Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD Normet Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD Oil & Gas Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD Pty Limited Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD Renewables Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
GRD Waste Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Innofield Services Pty Ltd Level 6, 54-58 Mounts Bay Road, Perth WA 6000 100
KEC International Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Kirfield Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
M & O Global Pty Ltd Wood Group House, Level 6, 432 Murray Street, Perth WA 6000 100
Macraes New Zealand Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Marine & Offshore Group Pty Limited Wood Group House, Level 6, 432 Murray Street, Perth WA 6000 100
Minproc Engineers Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Minproc Group Superannuation Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Minproc Overseas Projects Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Minproc Projects (Ghana) Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Minproc Technology Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Mustang Engineering Pty. Ltd. Wood Group House, Level 6, 432 Murray Street, Perth WA 6000 100
Octagon International Properties Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
ODL PTY LTD Wood Group House, Level 6, 432 Murray Street, Perth WA 6000 100
Qedi Completions & Commissioning Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
Rider Hunt International (WA) Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
S2V Consulting Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
South Shore Nominees Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
SVT Holdings Pty Ltd Wood Group House, Level 6, 432 Murray Street, Perth WA 6000 100
Terra Nova Technologies Australia Pty Ltd Level 7, 197 St Georges Terrace, Perth, WA, 6000, Australia 100
WGPSN Queensland Pty Ltd Santos Place, Level 9, 32 Turbot Street, Brisbane QLD 4000 100
Wood Group Australia PTY Ltd Wood Group House, Level 6, 432 Murray Street, Perth WA 6000 100
Wood Group Engineering and Production Facilities Australia Pty Ltd Wood Group House, Level 6, 432 Murray Street, Perth WA 6000 100
Wood Group Integrity Management Pty Ltd Wood Group House, Level 6, 432 Murray Street, Perth WA 6000 100
Wood Group Kenny Australia Pty Ltd Wood Group House, Level 6, 432 Murray Street, Perth WA 6000 100
Wood Group PSN Australia Pty Ltd Level 3, 171 Collins Street, Melbourne,  VIC 3000 100
Azerbaijan
AMEC Limited Liability Company AZ1010, Baku City Sabail District, Nizami 90A, Azerbaijan 100
Wood Group PSN Azerbaijan LLC 96E Nizami Street, Sabail, Baku, AZ 1010 100
Bahamas
Montreal Engineering (Overseas) Limited  c/o 2020 Winston Park Drive, Suite 7000, Oakville Ontario 100
Bermuda
AMEC (Bermuda) Limited Canon's Court, 22 Victoria Street, (PO Box HM 1179), Hamilton, HM EX, Bermuda 100
Atlantic Services Limited Canon's Court, 22 Victoria Street, (PO Box HM 1179), Hamilton, HM EX, Bermuda 100
Foster Wheeler Holdings Ltd. Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda 100
Foster Wheeler Ltd. Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda 100
FW European E & C Ltd. Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda 100
FW Management Operations, Ltd. Clarendon House, 2 Church Street, P.O. Box HM 1022, Hamilton HM CX, Bermuda 100
Production Services Network International Limited Canon's Court, 22 Victoria Street, Hamilton, Bermuda HM12 100
Bolivia
ISI Mustang Bolivia S.R.L. Avenida San Martin Calle 6 Este, Equipetrol No. 5, Barrio, Santa Cruz 100
Brazil
AMEC do Brasil Participações Ltda Rua Quitanda 50, 15th floor, Centro, Rio de Janeiro, CEP 20011-030, Brazil 100
Amec Foster Wheeler America Latina, Ltda. Centro Empresarial Ribeirao Office Tower, Av. Braz Olaia Acosta, 727 - 18 andar - Sl. 1810, Cep. 14026-404 - Jd. California, Ribeirao Preto, Sao Paulo, Brazil 100
Amec Foster Wheeler Brasil S.A. Rua Quitanda 50, 15th floor, Centro, Rio de Janeiro, CEP 20011-030, Brazil 100
AMEC Petroleo e Gas Limitada Rua Quitanda 50, 15th floor, Centro, Rio de Janeiro, CEP 20011-030, Brazil 100
AMEC Projetos e Consultoria Ltda Rua Professor Moraes No. 476, Loja 5, Sobreloja, Bairro Funcionarios, Belo Horizonte, Minas Gerais, 30150-370, Brazil 100
Santos Barbosa Tecnica Comercio e Servicios Ltda Estrada Sao Jose do Mutum, 301 - Imboassica, Cidade de Macae, Rio de Janeiro, CEP 27973-030 100
Wood Group Engineering and Production Facilities Brasil Ltda Rua Ministro Salgado Filho, 119, Cavaleiros, Cidade de Macae, Estado do Rio de Janeiro, CEP 27920-210 100
Wood Group Kenny do Brasil Servicos de Engenharia Ltda Rua Sete de Setembro, 54 - 4 andares, Centro, Rio de Janeiro - RJ, CEP 20050-009 100
British Virgin Islands
MDM Engineering Group Limited Commerce House, Wickhams Cay 1, P.O. Box 3140, Road Town, Tortola, British Virgin Islands 100
Brunei Darussalam
Amec Foster Wheeler (B) SDN BHD Unit No.s 406A-410A, Wisma Jaya, Jalan Pemancha, Bandar Seri Begawan BS8811, Brunei Darussalam 99
Bulgaria
AMEC Minproc Bulgaria EOOD 7th Floor, 9-11 Maria Louisa Blvd, Vazrazhdane District, Sofia 1301, Bulgaria 100
Cameroon
Amec Foster Wheeler Cameroun SARL Cap Limboh, Limbe, BP1280, Cameroon 100
Canada
418750 Alberta Inc. 900 AMEC Place, 801-6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 100
AMEC BDR Limited 900 AMEC Place, 801-6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 100
Amec Foster Wheeler Canada Ltd. 1925-18th Avenue NE, Suite 401, Calgary, AB, T2E 7T8, Canada 100
CK Temple Holdings Ltd. 900 AMEC Place, 801-6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 100
Rider Hunt International (Alberta) Inc. 900 AMEC Place, 801-6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 100
AFW Canada Investments Limited Suite 2400, 745 Thurlow Street, Vancouver, BC, V6E 0C5 100
AFW Canadian Holdco Inc. Suite 2400, 745 Thurlow Street, Vancouver, BC, V6E 0C5 100
AMEC Canada Finance ULC 111, Dunsmuir St., Vancouver, BC, V6B 5W3, Canada 100
AMEC Canada Holdings Inc. Suite 2400, 745 Thurlow Street, Vancouver, BC, V6E 0C5 100
QEDI Commissioning and Completions (Canada) Limited Suite 2400, 745 Thurlow Street, Vancouver, BC, V6E 0C5 100
AMEC Earth & Environmental Limited 801, 900, 6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 100
Amec Foster Wheeler Americas Limited 2020 Winston Park Drive, Suite 700, Oakville, ON, L6H 6X7, Canada 100
Amec Foster Wheeler Inc. 2020 Winston Park Drive, Suite 700, Oakville, ON, L6H 6X7, Canada 100
AMEC Infrastructure Limited 900 AMEC Place, 801-6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 100
AMEC South America Limited 2020 Winston Park Drive, Suite 700, Oakville, ON, L6H 6X7, Canada 100
Campro AGRA Limited 900 AMEC Place, 801-6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 100
Howe AGRA Limited 900 AMEC Place, 801-6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 100
MASA Ventures Limited 900 AMEC Place, 801-6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 100
Wood Group Asset Integrity Solutions, Inc. Centennial Place, East Tower, 1900, 520 - 3rd Ave. S.W., Calgary, Alberta,  T2P 0R3 100
Wood Group Canada, Inc. Centennial Place, East Tower, 1900, 520 - 3rd Ave. S.W., Calgary, Alberta,  T2P 0R3 100
Wood Group E&PF (Canada) Limited Centennial Place, East Tower, 1900, 520 - 3rd Ave. S.W., Calgary, Alberta,  T2P 0R3 100
Wood Group Kenny Canada Ltd. Centennial Place, East Tower, 1900, 520 - 3rd Ave. S.W., Calgary, Alberta,  T2P 0R3 100
Wood Group Mustang (Canada) Construction Management Inc. Centennial Place, East Tower, 1900, 520 - 3rd Ave. S.W., Calgary, Alberta,  T2P 0R3 100
AMEC Geomatics Limited 900 AMEC Place, 801-6th Avenue S.W., Calgary, AB, T2P 3W3, Canada 75
Cayman Islands
FW Chile Holdings Ltd. Codan Trust Company (Cayman) Limited, Cricket Square, Hutchins Drive, PO Box 2681, George Town, KY1-1111 100
Wood Group O&M International, Ltd. Whitehall House, 238 North Church Street, George Town, Grand Cayman KY1-1102 100
Wood Group OTS International Inc. Whitehall House, 238 North Church Street, George Town, Grand Cayman KY1-1102 100
Chile
AMEC CADE Ingeniería y Desarrollo De Proyectos Limitada Av. Jose Domingo, Canas No 2640, Nunoa, Santiago, 7750164, Chile 100
AMEC Chile Ingeniería y Construcción Limitada Av. Jose Domingo, Canas No 2640, Nunoa, Santiago, 7750164, Chile 100
Amec Foster Wheeler International Ingenieria y Construcción Limitada Av. Apoquindo 3846, piso 15, Las Condes, Santiago, 7550123, Chile 100
Amec Foster Wheeler Talcahuano, Operaciónes y Mantenciones Limitada Camino A Ramuntcho 3230, Sector 4 Esquinas, Talcahuano, Chile 100
ISI Mustang Chile SpA Calle Providencia 337, off. 7, Comuna de Providencia, Santiago 100
Terra Nova Technologies Chile Limitada Av. Apoquindo 3846, piso 15, Las Condes, Santiago, 7550123, Chile 100
China
AG Offshore Engineering (China) Ltd Room A25, 3rd Floor, No 473 West Fute 1st Road, Shanghai 100
Amec Foster Wheeler Engineering & Construction Design (Shanghai) Co., Ltd. Room 401, Floor 4, No, 120 Qixia Road, Pudong New Area, Shanghai, China 100
Amec Foster Wheeler Engineering & Consulting (Shanghai) Co., Ltd Room 204, Building 1, No. 1287, Shangcheng Road, Pudong New District, Shanghai 100
Feng Neng Sgurr (Beijing) Renewable Energy Technology Co. Ltd 1217, No 5 Dongzhimen South Avenue, Dongcheng 100
Grenland Group (China) Limited Room D2, 6th Floor, No 2446, Jin Qiao Road, Pudong, Shanghai 100
Colombia
Amec Foster Wheeler Colombia SAS Calle 110 No. 9-25, Offices 515 and 516, Bogotá, Colombia 100
Procesos y Disenos Energeticos SA Carrera 11 A No. 96-51 5th floor, Bogota D.C. 100
Curaçao
Harwat International Finance Corporation N.V. Penstraat 35, P.O. Box 4888, Curacao 100
Cyprus
AMEC Overseas (Cyprus) Limited 1, Lampousas Street, 1095 Nicosia, Cyprus 100
J P Kenny Overseas Limited Themistokli Dervi 5, Elenion Building, 2nd Floor, P.C. 1005, Nicosia 100
WG International Services Limited Elenion Building, 2nd Floor, 5 Themistocles Street, CY-1066 Nicosia 100
WGPF Contracting Limited Elenion Building, 2nd Floor, 5 Themistocles Street, CY-1066 Nicosia 100
WGPS International Limited Elenion Building, 2nd Floor, 5 Themistocles Street, CY-1066 Nicosia 100
Wood Group Angola Limited Elenion Building, 2nd Floor, 5 Themistocles Street, CY-1066 Nicosia 100
Wood Group Engineering Services (North Africa) Limited Elenion Building, 2nd Floor, 5 Themistocles Street, CY-1066 Nicosia 100
Wood Group Equatorial Guinea Limited Elenion Building, 2nd Floor, 5 Themistocles Street, CY-1066 Nicosia 100
Czech Republic
Amec Foster Wheeler Nuclear Czech Republic, a.s. Brno, K?enová, 184/58, 602 00, Czech Republic 100
Amec Foster Wheeler s.r.o. Krenova 58, Brno, 60200, Czech Republic 100
Egypt
Foster Wheeler Petroleum Services S.A.E. Al-Amerya General Free Zone, Alexandria, Egypt 100
Equatorial Guinea
Baker Energy International Equatorial Guinea S.A. Bioko, Island Region, Malabo 65
Hexagon Sociedad Anonima con Consejo de Administracion Solege, Calle Kenia S/N, Malabo 65
France
Amec Foster Wheeler France S.A. 14, Place de la Coupole, Charenton-le-Pont, France, 94220 100
Amec Foster Wheeler Nuclear France SAS Immeuble Horizon Sainte Victoire, Bâtiment A, 970 rue René Descartes, 13857 Aix-en-Provence cedex 3, France 100
Wood Group Engineering Services (France) SAS 6 Pl de la Madeleine, Paris, 75008 100
Wood Group France SAS 15-19 rue des Mathurins, Paris 75009 100
Gabon
Production Services Network Gabon SARL Place of Independence, En face de la BVMAC, Libreville, Gabon BP 922 100
Germany
Amec Foster Wheeler E & I GmbH Weserstrasse 4, Frankfurt am Main, 60329, Germany 100
Bauunternehmung Kittelberger GmbH Von-Miller-Strasse 13, 67661 Kaiserslautern, Germany 100
KIG Immobilien Beteiligungsgesellschaft mbH Hammstrasse 6, 04129 Leipzig, Germany 100
KIG Immobiliengesellschaft mbH & Co. KG Hammstrasse 6, 04129 Leipzig, Germany 100
Ghana
Amec Foster Wheeler Operations Ghana Limited 3rd Floor Teachers Hall Complex, Education Loop, Off Barnes Road, PO Box 1632, Accra, Ghana 100
MDM Projects - Ghana Limited 2nd Floor Cedar House, 13 Samora Machel Road, Asylum Down, Accram, Ghana 100
Amec Foster Wheeler & BBS Limited No 4 Momotsa Avenue, Behind All Saints Anglican Church, Adabraka, Accra, Ghana 80
Wood Group Ghana Limited 20 Jones Nelson Road, Adabraka, Accra 49*
Gibraltar
Foster Wheeler (Gibraltar) Holdings Limited Suite 1, Burns House, 19 Town Range, Gibraltar 100
Greece
Foster Wheeler Hellas Engineering and Construction Societe Anonyme 21 Elvetias Street, (First Floor), Agia Paraskevi, 153 42, Greece 100
Guatemala
AMEC Guatemala Engineering and Consulting, Sociedad Anonima Ciudad Guatemala, Guatemala 100
Guernsey
AMEC Operations Limited 22 Havilland Street, St Peter Port, GY1 2QB, Guernsey 100
Garlan Insurance Limited St Martins House, Le Bordage, St Peter Port, GY1 4AU 100
Wood Group Offshore Services Limited Ogier House, St Julian's Avenue, St Peter Port, GY1 1WA 100
Hong Kong
AMEC Engineering Limited 5008, 50th Floor, Central Plaza, 18 Harbour Road, Wanchai, Hong Kong 100
SgurrEnergy Hong Kong Limited 26/F Beautiful group Tower, 77 Connaught Road Central, Hong Kong 100
AMEC Asia Pacific Limited 5008, 50th Floor, Central Plaza, 18 Harbour Road, Wanchai, Hong Kong 99
Hungary
FW Hungary Licensing Limited Liability Company Krisztina korut 2-4. I. em. 17, Budapest, Hungary, 1122 100
India
Amec Foster Wheeler India Global Business Services LLP V Floor, "Zenith Building", Ascendas IT Park, CSIR Road, Taramani, Chennai, 600 113, India 100
Amec Foster Wheeler India Private Limited 6th Floor, Zenith Building, Ascendas IT Park, CSIR Road, Taramani, Chennai 600 113, India 100
Ingenious Process Solutions Private Limited 307, Atlanta Estate, 3rd Floor, Hanuman TekdiI Road Vitbhatti, Off. W. E. Highway, Goregaon (East) Mumbai MH 400063 100
Mustang Engineering India Private Limited R9, F -3 RD W: B, P-214, B- Wing, Laxmikant Apartment, Sitaram Keer Marg, Mahim, Mumbai 400016 100
Wood Group Kenny India Private Limited Floor 15, Building No 5, DLF Cyber City, Phase III, Gurgaon - 122002, Haryana 100
Wood Group PSN India Private Limited Floor 15, Building No 5, Tower B, Cyber Terraces, Gurgaon - 122002, Haryana 100
SgurrEnergy India Pvt. Ltd 58/2 Kausar Baugh, Off NIBM Road, Kondhwa, Pune, Maharashtra 411048 50
Indonesia
PT AGRA Monenco 2020 Winston Park Drive, Suite 700, Oakville, ON, L6H 6X7, Canada 100
PT Simons International Indonesia 100
PT Australian Skills Training Green Town Warehouse No. 2, Bengkong-Batam 95
PT Foster Wheeler O&G Indonesia Perkantoran Pulo mas Blok VII No.2, Jl. Perintis Kemerdekaan, Pulo Gadung, Jakarta Timur 13260, Indonesia 90
PT Wood Group Indonesia Office 88 Tower, 20th - H Floor, Jl. Casablanca Kav 88, South Jakarta 12870 90
PT Amec Foster Wheeler Indonesia Perkantoran Pulo mas Blok VII No. 2, Jl Perintis Kemerdekaan, Pulo Gadung, Jakarta, Timur, Indonesia 85
Iran
Wood Group Iran - Qeshm Company (pjs) No 2564, Hafez Street, Toola Industrial Park, Annaba, Qeshm Island 97
Iraq
Ghabet El Iraq for General Contracting and Engineering Services, Engineering Consultancy (LLC) Suite 24, Building 106, St 19, Sec 213, Al-Kindi St, Al-Haritheeya Qts, Baghdad 100
Touchstone General Contracting, Engineering Consultancy and Project Management LLC Flat no. 23A, 3rd Floor, near Kahramana Square Anbar Building, District no. 903, Hay Al Karada, Baghdad, Iraq 100
Wood Group, LLC Shoresh, Hadid and Khashab St., Erbil, 100
Ireland
JWG Ireland CAD Unlimited Company Second Floor, Blocks 4 and 5, Galway Technology Park, Parkmore, Galway 100
JWG Ireland NOK Unlimited Company Second Floor, Blocks 4 and 5, Galway Technology Park, Parkmore, Galway 100
JWG Ireland USD 2 Unlimited Company Second Floor, Blocks 4 and 5, Galway Technology Park, Parkmore, Galway 100
JWG Ireland USD 3 Unlimited Company Second Floor, Blocks 4 and 5, Galway Technology Park, Parkmore, Galway 100
JWG Ireland USD Unlimited Company Second Floor, Blocks 4 and 5, Galway Technology Park, Parkmore, Galway 100
Marine Computation Services Kenny Group Limited 70 Sir John Rogerson's Quay, Dublin 2 100
Wood Group Kenny Ireland Limited 70 Sir John Rogerson's Quay, Dublin 2 100
Pyeroy (Ireland) Unlimited 70 Sir John Rogerson's Quay, Dublin 2 95
Italy
Amec Foster Wheeler Italiana S.r.l. Via S. Caboto 15, Corsico, 20094, Italy 100
FW TURNA S.r.l. Via S. Caboto 15, Corsico (Milano), 20094, Italy 100
Jamaica
Monenco Jamaica Limited 2020 Winston Park Drive, Suite 700, Oakville, Ontario 100
Japan
Amec Foster Wheeler Asia K.K. Shiba International Law Offices, 1-3-4-5F Atago, Minatoku, Tokyo, 105-0002, Japan 100
Jersey
AltaBlue Limited 28 Esplanade, St Helier, JE2 3QA, Jersey 100
AMEC Canada Investments Company Limited 95/97 Halkett Place, St Helier, JE1 1BX, Jersey, United Kingdom 100
AMEC Nuclear Consultants International Limited 95/97 Halkett Place, St Helier, JE1 1BX, Jersey, United Kingdom 100
GTS Power Solutions Limited 28 Esplanade, St Helier, JE2 3QA, Jersey 100
Wood Group Engineering Services (Middle East) Limited 28 Esplanade, St Helier, JE2 3QA, Jersey 100
Wood Group Production Facilities Limited 28 Esplanade, St Helier, JE2 3QA, Jersey 100
Kazakhstan
AMEC Limited Liability Partnership 78A Azattyk Avenue, Atyrau, 060005, Kazakhstan 100
Foster Wheeler Kazakhstan LLP app. 27, h. 64, Bostandykskiy district, Abaya Ave., Almaty City, Kazakhstan 100
QED International (Kazakhstan) Limited Liability Partnership 78, "A" Azattyk avenue, Atyrau 060005, Kazakhstan 100
Wood Group Kazakhstan LLP 55 Ablai Khan Ave., Room #112/114, Almaty 050004 100
Yeskertkish Kyzmet Kazakhstan LLP Atyrau City, Airport Area, Atyrau 100
Kuwait
AMEC Kuwait Project Management and Contracting Company W.L.L. 2nd Floor, Al Mutawa Building, Ahmed Al Jaber Street, Sharq, Kuwait City 49*
Liberia
Amec Foster Wheeler Liberia Inc King Plaza, 2nd-4th Floors, Broad Street, Monrovia 10, Liberia 100
Luxembourg
AFW Luxembourg 1 S.a.r.l. 5, rue Guillaume Kroll, Luxembourg, L-1882 100
AFW Luxembourg 2 S.a.r.l. 5, rue Guillaume Kroll, Luxembourg, L-1882 100
FW Europe Financial Holdings S.à r.l. 5, rue Guillaume Kroll, Luxembourg, L-1882 100
FW Holdings S.à r.l. 5, rue Guillaume Kroll, Luxembourg, L-1881 100
FW Investment Holdings S.à r.l. 5, rue Guillaume Kroll, Luxembourg, L-1882 100
Financial Services S.à r.l. 5, Rue Guillaume J. Kroll, L-1882, Luxembourg 100
Malaysia
AMEC (Malaysia) Sdn Bhd Suite 1005, 10th Floor, Wisma Hamzah-Kwong Hing, No. 1, Leboh Ampang, Kuala Lumpur, 50100, Malaysia 100
Amec Foster Wheeler OPE Sdn. Bhd. 12th Floor, West Block, Wisma Selangor Dredging, 142-C Jalan Ampang, Kuala Lumpur, 50450, Malaysia 100
AMEC Holdings (Malaysia) Sdn Bhd Suite 1005, 10th Floor, Wisma Hamzah-Kwong Hing, No. 1, Leboh Ampang, Kuala Lumpur, 50100, Malaysia 100
AMEC Oil Gas and Process Sdn Bhd Suite 1005, 10th Floor, Wisma Hamzah-Kwong Hing, No. 1, Leboh Ampang, Kuala Lumpur, 50100, Malaysia 100
AMEC Process & Energy Sdn Bhd Suite 1005, 10th Floor, Wisma Hamzah-Kwong Hing, No. 1, Leboh Ampang, Kuala Lumpur, 50100, Malaysia 100
BMA Engineering Sdn Bhd Unit C-12-4, Level 12, Block C, Megan Avenue II, 50450 Kuala Lumpur, Wilayah Persekutuan 100
Foster Wheeler (Malaysia) Sdn. Bhd. Suite 1005, 10th Floor, Wisma Hamzah-Kwong Hing, No. 1, Leboh Ampang, Kuala Lumpur, 50100, Malaysia 100
Mustang Malaysia Sdn. Bhd Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Wilayah Persekutuan 100
Rider Hunt International (Malaysia) Sdn Bhd Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Wilayah Persekutuan 100
Wood Group Engineering Sdn. Bhd Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Wilayah Persekutuan 0*
Wood Group Kenny Sdn Bhd Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Wilayah Persekutuan 0*
Wood Group Mustang (M) Sdn. Bhd. Level 7, Menara Milenium, Jalan Damanlela, Pusat Bandar Damansara, Damansara Heights, 50490 Kuala Lumpur, Wilayah Persekutuan 100
Foster Wheeler E&C (Malaysia) Sdn. Bhd. Suite 1005, 10th Floor, Wisma Hamzah-Kwong Hing, No. 1, Leboh Ampang, Kuala Lumpur, 50100, Malaysia 70
Wood Group Production Facilities (Malaysia) Sdn. Bhd. Lot 1-3, Level 5, Block G (South), Pusat Bandar Damansara, 50490 Kuala Lumpur 48*
Mauritius
MDM Engineering Investments Ltd 1st Floor, Felix House, 24 Dr Joseph Street, Port Louis, Mauritius 100
MDM Engineering Projects Ltd 1st Floor, Felix House, 24 Dr Joseph Street, Port Louis, Mauritius 100
P.E. Consultants, Inc. St James Court-Suite 308, St Denis Street, Port Louis, Mauritius 100
QED International Ltd C/o Appleby Management (Mauritius) Ltd, 11th Floor, Medine Mews, La Chaussée Street, Port Louis, Mauritius 100
Mexico
Amec Foster Wheeler Energia Mexico S. de R.L. de C.V. Av. Vasconcelos 453, Colonia del Valle 66220 Nuevo Leon, Monterrey (Estados Unidos de México), Mexico 100
Amec Foster Wheeler Mexico, S.A. de C.V. c/o Carlos Salazar, 2333 Oriente, Col. Obrera, Monterrrey, Nuevo Leon, 64010, Mexico 100
AYMEC de Mexico S.A. de C.V. 453 Planta Alta Del Valle, San Pedro Garza Garcia, Nuevo Leon 66220, Mexico 100
Exergy Engineering Services, S.A. de C.V. David Alfaro Siqueiros 104 piso 2, Col. Valle Oriente, San Pedro Garza Garcia, Nuevo Leon, CP. 66269, Mexico 100
Exergy Engineering, S.A. de C.V. David Alfaro Siqueiros 104 piso 2, Col. Valle Oriente, San Pedro Garza Garcia, Nuevo Leon, CP. 66269, Mexico 100
Global Mining Projects and Engineering, S.A. de C.V. Calle Coronado 124, Zona Centro, Chihuahau, Chihuahau, 31000, Mexico 100
ISI Mustang Servicios de Ingenieria de Mexico, S de R.L. De C.V. Homero 1804 Piso 11, Col. Los Morales - Delegacion Miguel Hidalgo, Mexico City, Distrito Federal, C.P. 11540 100
MACTEC Mexico S.A. de C.V. Paseo de la Reforma 450, Lomas de Chapultepec, 11000 Mexico D.F., Mexico 100
Wood Group de Mexico S.A. de C.V. Blvd. Manuel Avila Camacho 40 - 1801, Lomas de Cahpultepec, Delgacion Miguel Hidalgo, D.F. 11000 100
Wood Group Management Services de Mexico S.A. de C.V. Blvd. Manuel Avila Camacho 40 - 1801, Lomas de Cahpultepec, Delgacion Miguel Hidalgo, D.F. 11000 100
Mongolia
AMEC LLC Suite 403, 4th Floor New Century Plaza, Chinggis Avenue, Sukhbaatar District, Ulaanbaatar, Mongolia 100
Mozambique
Amec Foster Wheeler Mozambique Limitada Mocambique, Maputo Cidade, Distrito Urbano 1, Bairro Sommerschield II, Av. Julius Nyerere, nº 3412, Maputo, Mozambique 100
Wood Group Mocambique, Limitada 73 Rua Jose Sidumo, Bairro da Polana, Maputo 100
Netherlands
AMEC GRD SA B.V. Prins Bernhardplein 200, Amsterdam, 1097 JB, Netherlands 100
AMEC Holland B.V. Prins Bernhardplein 200, Amsterdam, 1097 JB, Netherlands 100
AMEC International Investments B.V. Meander 251, Arnhem, 6825 MC, Netherlands 100
AMEC Investments B.V. Prins Bernhardplein 200, 1097 JB, Amsterdam, Netherlands 100
Foster Wheeler Continental B.V. Naritaweg 165, 1043 BW Amsterdam, Netherlands 100
Foster Wheeler Europe B.V. Naritaweg 165, 1043 BW Amsterdam, Netherlands 100
John Wood Group B.V. Atrium Building, 8th Floor, Strawinskylaan 3127, Amsterdam, 1077 ZX 100
John Wood Group Holdings BV Atrium Building, 8th Floor, Strawinskylaan 3127, Amsterdam, 1077 ZX 100
Wood Group Azerbaijan B.V. Atrium Building, 8th Floor, Strawinskylaan 3127, Amsterdam, 1077 ZX 100
New Zealand
Amec Foster Wheeler AC-NZ Limited 22 Customs Street, Auckland Central, Auckland, 1010, New Zealand 100
AMEC New Zealand Limited c/o KPMG, 18 Viaduct Harbour Avenue, Maritime Square, Auckland, New Zealand 100
M&O Pacific Limited 28 Manadon Street, New Plymouth 100
Nicaragua
MACTEC Engineering and Consulting, Sociedad Anonima (Nicaragua) Del Hospital Militar, 1 Cuadra al Lago, Managua, Nicaragua 98
Nigeria
AMEC Contractors (W/A) Limited 13A AJ Marinho Drive, Victoria Island, Lagos, Nigeria 100
AMEC King Wilkinson (Nigeria) Limited No 3, Hospital Road, PO Box 9289, Lagos, Nigeria 100
Foster Wheeler (Nigeria) Limited 1 Murtala Muhammed Drive, (Formerly Bank Road), Ikoyi, Lagos, Nigeria 100
Overseas Technical Services Nigeria Limited No 13 Sumbo Jibowu Street, Ikoyi, Lagos 93
Foster Wheeler Environmental Company Nigeria Limited c/o Nwokedi & Co., 21 Ajasa Street, Onikan, Nigeria 87
AMEC Offshore (Nigeria) Limited 18th Floor, Western House, 8/10 Broad street, Lagos, Nigeria 75
Monenco Nigeria Limited Ebani House (Marina side), 62 Marina, Lagos, Nigeria 60
JWG Nigeria Limited 13 Sumbo Jibowu Street, Ikoyi, Lagos 49*
Norway
Erbus AS Fokserodveien 12, Sandefjord, 3241 100
Wood Group Kenny Norge AS Lkkeveien 99, Stavanger 100
Wood Group Norway AS Fokserodveien 12, Sandefjord 100
Wood Group Norway Holdings AS Fokserodveien 12, Sandefjord 100
Wood Group Norway Operations AS Kanalsletta 2, 4033 Stavanger 100
Oman
Amec Foster Wheeler Engineering Consultancy LLC PO Box 1469, Postal Code 133, Al-Khuwair, Sultanate of Oman 60
Papau New Guinea
Wood Group PNG Limited Level 5, Bsp Haus, Harbour City, Port Moresby, National Capital District, Papau New Guinea 100
Peru
Amec Foster Wheeler (Perú) S.A. Calle Las Begonias 441, Piso 8, San Isidro, Lima, 27, Peru 100
ISI Mustang Peru S.A.C. Calle Martir Olaya 201, off. 801 Miraflores, Lima 100
Wood Group Peru S.A.C. Av. de la Floresta 407, 5th Floor, San Borja, Lima 100
Philippines
Foster Wheeler (Philippines) Corporation U-7A, 7/F PDCP Bank Centre,V.A. Rufino St. Corner L.P. Leviste St., Salcedo Village, Makati City, PH, 1227 100
Production Services Network Holdings Corp. 585 ME National Road HW, Barangay Alangilan, Batangas City, Batangas 100
PSN Production Services Network Philippines Corp 12th Floor, Net One Center, 26th Street Corner, 3rd Avenue, Crescent Park West, Bonifacio Global City, Taguig, Metro Manilla 1634 40*
Poland
Amec Foster Wheeler Consulting Poland Sp. z o.o. Ul.Chmielna 85/87, Warsaw, 00-805, Poland 100
Portugal
Amec Foster Wheeler (Portugal) Lda Avenida Barbosa du Bocage 113-4, Lisboa, 1050-031, Portugal 100
Qatar
Production Services Network Qatar LLC PO Box 2515, Doha 24*
Romania
AMEC Environment & Infrastructure SRL 59, Gr. Alexandrescu St., 2nd Floor, 1st District, Bucharest, Code 010626, Romania 100
Amec Foster Wheeler Nuclear RO SRL Str. Grigore Alexandrescu 59, Etaj 2 (second floor), Sector 1, Bucharest, Romania 100
AMEC Operations S.R.L Rooms 1 and 2, 2nd Floor, No. 59 Strada Grigore Alexandrescu, Sector 1, Bucharest 010623, Romania 100
PSN Overseas Romania SRL Ploiesti, 225 Gheorghe Doja Street, 2nd Floor, Prahova County 100
Russia
AMEC Eurasia Limited Novy Arbat, 11 bld., 1 Moscow, Russian Federation 100
OOO Amec Foster Wheeler Office E-100, Park Place, 113/1, Leninsky Prospekt, 117198, Moscow, Russian Federation 100
Production Services Network Eurasia LLC Tverskaya St. 16/3, Moscow 50*
Production Services Network Sakhalin LLC 2-6 Floors, 88 Amurskaya, 693020, Yuzhno-Sakhalinsk 50*
Sakhalin Technical Services Network LLC Suite 417, Kommunistichesy Prospekt 32, Yuzhno-Sakhalinsk, Sakhalin 40*
Saudi Arabia
Mustang Saudi Arabia Co. Ltd. P.O. Box 17411, Riyadh 100
Mustang and Faisal Jamil Al-Hejailan Consulting Engineering Company PO Box 9175, Riyadh 75
Wood Group ESP Saudi Arabia Limited PO Box 1280, Al-Khobar 51
Singapore
Amec Foster Wheeler Asia Pacific Pte. Ltd. One Marina Boulevard #28-00, Singapore, 018989, Singapore 100
AMEC Global Resources Pte Limited 991E Alexandra Road, #01 - 25, 119973, Singapore 100
AMEC Global Services Pte Ltd 991E Alexandra Road, #01 - 25, 119973, Singapore 100
Australian Skills Training Pte. Ltd. Shaw Tower #28-09, 100 Beach Road, Singapore, 189702 100
Foster Wheeler Eastern Private Limited 1 Marina Boulevard, #28-00, Singapore 018989 100
OPE O&G Asia Pacific Pte. Ltd. 1 Marina Boulevard, #28-00, One Marina Boulevard, 018989, Singapore 100
Rider Hunt International (Singapore) Pte Limited 24 Raffles Place, #24-03 Clifford Centre, Singapore, 048621 100
Simons Pacific Services Pte Ltd. #27-01 Millenia Tower, 1 Temasek Ave, Singapore, 039192 100
Wood Group Engineering Pte. Limited Shaw Tower #28-09, 100 Beach Road, Singapore, 189702 100
Wood Group International Services Pte. Ltd. Shaw Tower #28-09, 100 Beach Road, Singapore, 189702 100
Slovakia
Amec Foster Wheeler Nuclear Slovakia s.r.o. Piestanska 3, Trnava, 917 01, Slovakia 100
The Automated Technology Group (Slovakia) s.r.o. Hviezdoslavovo namestie 13, Mestska cast Stare Mesto, Bratislava 811 02 100
South Africa
Amec Foster Wheeler Properties (Pty) Limited Second Road, Halfway House, P. O. Box 76, Midrand 1685, South Africa 100
AMEC Minproc (Proprietary) Limited 2 Eglin Road, Sunninghill, 2157, South Africa 100
MDM Technical Africa (Pty) Ltd Zeelie Office Park, 381 Ontdekkers Road, Floida Park Ext 3, Roodepoort, 1709, South Africa 100
Wood Group (South Africa) Pty Ltd PO Box 2506, Houghton 2041 100
Mossel Bay Energy IPP (proprietary) Limited (RF) 2nd Road Halfway House, Midrand, South Africa 90
Nuclear Consultants International (Proprietary) Limited Nr 5, 5th Ave, Melkbos Strand, Cape Town, 7441, South Africa 85
Amec Foster Wheeler South Africa (PTY) Limited Second Road, Halfway House, Midrand, 1685 70
South Korea
AMEC Korea Limited KT Building 11F, 14 Yeouidaero, Youngdeungpo-gu, Seoul 07320, Korea, Republic of 100
Spain
Amec Foster Wheeler Energia, S.L.U. Calle Gabriel Garcia Marquez, no 2, Parque Empresarial Madrid, Las Rozas, 28232 Las Rozas, Madrid, Spain 100
Amec Foster Wheeler Iberia S.L.U. Calle Gabriel Garcia Marquez, no 2, Parque Empresarial Madrid, Las Rozas, 28232 Las Rozas, Madrid, Spain 100
Conequip, S.A. Calle Gabriel Garcia Marquez, no 2, Parque Empresarial Madrid, Las Rozas, 28232 Las Rozas, Madrid, Spain 100
Switzerland
A-FW International Investments GmbH c/o Intertrust Services (Schweiz) AG, Alpenstrasse 15, 6300, Zug, Zug, Switzerland 100
Amec Foster Wheeler Engineering AG Lohweg 6, 4054 Basel, Switzerland 100
FW Financial Holdings GmbH c/o BDS Consulting AG, Vordergrasse 3, Schaffhausen, 8200, Switzerland 100
Tanzania
MDM Projects-Tanzania Limited 11th Floor, PPF Towers, Gardens Avenue / Ohio Street, Dar es Salaam, Tanzania 100
Thailand
Amec Foster Wheeler Holding (Thailand) Limited 1st Floor Talaythong Tower, 53 Moo 9, Sukhumvit Road, Thungsukla, Sriracha, Chonburi, 20230, Thailand 100
Foster Wheeler (Thailand) Limited 53 Talaythong Tower, 1st Floor, Moo 9, Sukhumvit Road, Tambol Tungsukhla, Amphur Sriracha, Chonburi, 20230, Thailand 100
SIE Siam Limited 91/17 Soi Wattananivet 4, Suthisarnvinijchai Road, Khwaeng Samsennok, Khet Huaykwang, Bangkok Metropolis, Thailand 100
Simons International Engineering Ltd. 91/17 Soi Wattananivet 4, Suthisarnvinijchai Road, Khwaeng Samsennok, Khet Huaykwang, Bangkok Metropolis, Thailand 100
The Democratic Republic of the Congo
MDM Engineering SPRL 32 Avenue 3Z, Commune de Kasuku, Ville de Kindu, Democratic Republic of Congo 100
Trinidad and Tobago
Wood Group Trinidad & Tobago Limited 18 Scott Bushe Street, Port of Spain 100
Turkey
Amec Foster Wheeler Bimas Birlesik Insaat ve Muhendislik A.S. Kucukbakkalkoy Mah, Çardak Sok, No.1A Plaza, 34750 Atasehir, Istanbul, Turkey 100
Uganda
Wood Group PSN Uganda Limited KAA House, Plot 41, Nakasero Road, PO Box 9566, Kampala 100
United Arab Emirates
AMEC Growth Regions Support FZ LLC 41st Floor, Business Central Towers, Dubai, United Arab Emirates 100
Attric International FZ LLE Fujairah Tower, Fujairah, Creative City - Media Free Zone, UAE 100
PSN Overseas Holding Company Limited The MAZE Tower, 15th Floor, Sheikh Zayed Road, PO Box 9275, Dubai 100
QED International FZ LLC Knowledge Village, Alsufouh Road, Dubai, United Arab Emirates 100
Production Services Network Emirates LLC Floor 5, International Tower, Capital Centre, 24th (Karama) Street, P.O. Box 105828, Abu Dhabi 49*
United Kingdom
AFW E&C Holdings Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AFW Finance 2 Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AFW Finance 3 Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AFW Hungary Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AFW Investments 2 Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AFW Investments Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC (AGL) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC (BCS) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC (F.C.G.) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC (MH1992) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC (MHL) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC (WSL) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC BKW Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Bravo Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Building Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Canada Limited KPMG LLP, 15 Canada Square, Canary Wharf, London, E14 5GL 100
AMEC Capital Projects Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Civil Engineering Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Construction Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Design and Management Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Engineering Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Facilities Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler (Holdings) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Earth and Environmental (UK) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Energy Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Environment & Infrastructure UK Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Finance Asia Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Finance Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Group Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler International Holdings Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler International Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Nuclear Holdings Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Nuclear International Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Nuclear UK Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Amec Foster Wheeler Property and Overseas Investments Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Hedge Co 1 Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Infrastructure Services Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Investments Europe Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Kazakhstan Holdings Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Manufacturing and Services Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Mechanical and Electrical Services Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Mining Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Nominees Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Nuclear M & O Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Nuclear Overseas Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Nuclear Projects Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Offshore Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Offshore Services Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Process and Energy International Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Process and Energy Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Project Investments Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Services Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Spareco (12) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Spareco (14) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Staff Pensions Trustee Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Trustees Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC USA Finance Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC USA Holdings Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC USA Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Utilities Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Wind Developments Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Applied Environmental Research Centre Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Atlantis Hedge Co 1 Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Atlantis Hedge Co 2 Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Attric Ltd Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Energy, Safety and Risk Consultants (UK) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Entec Holdings Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Entec Investments Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Foster Wheeler (G.B.) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Foster Wheeler (London) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Foster Wheeler (Process Plants) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Foster Wheeler E&C Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Foster Wheeler Environmental (UK) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Foster Wheeler Europe Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Foster Wheeler Management Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Foster Wheeler Petroleum Development Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Foster Wheeler World Services Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
FW Chile Holdings 2 Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
FW Investments Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
MDM UK Finance Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Metal and Pipeline Endurance Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
National Nuclear Corporation Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Press Construction Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Process Industries Agency Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Process Plants Suppliers Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Rider Hunt International Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Sandiway Solutions (No 3) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Sigma 2 AFW Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Sigma Financial Facilities Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
The IDC Group Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
Tray Field Services Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
William Ellis (Etchingham) Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 100
AMEC Construction Scotland Limited Annan House, 33-35 Palmerston Road, Aberdeen, AB11 5QP, Scotland 100
AMEC Offshore Developments Limited Annan House, 33-35 Palmerston Road, Aberdeen, AB11 5QP, Scotland 100
James Scott Engineering Group Limited Annan House, 33-35 Palmerston Road, Aberdeen, AB11 5QP, Scotland 100
James Scott Limited Annan House, 33-35 Palmerston Road, Aberdeen, AB11 5QP, Scotland 100
QED International (UK) Limited Annan House, 33-35 Palmerston Road, Aberdeen, AB11 5QP, Scotland 100
Automated Technology Group Holdings Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
Autotech Controls Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
East Mediterranean Energy Services Limited 3rd Floor, 68-70 George Street, Edinburgh, EH2 2LR 100
HFA Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Igranic Control Systems Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
Integrated Maintenance Services Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
J W G Trustees Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
John Brown E & C Ltd Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
John Wood Group US Company 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
JWG Investments Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
JWGUSA Holdings Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Kelwat Investments Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
MCS Kenny International (UK) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Mustang Engineering Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Offshore Design Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Production Services Network (UK) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Production Services Network Bangladesh Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
PSJ Fabrications Ltd Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
PSN (Angola) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
PSN (Philippines) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
PSN Asia Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
PSN Overseas Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
SD FortyFive Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
SgurrEnergy Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Sigma 3 (North Sea) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ, Scotland 100
Talentworx Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
The Automated Technology Group Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
The Igranic Group Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
WDG038 Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
WGD023 Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
WGD028 Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
WGPSN (Holdings) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Algeria Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Algiers Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Annaba Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Arzew Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Engineering & Operations Support Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Engineering (North Sea) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Engineering Contractors Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Frontier Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Gas Turbine Services Holdings Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Hassi Messaoud Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Holdings (International) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Investments Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Kenny Corporate Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Kenny Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
Wood Group Kenny UK Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
Wood Group Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Management Services Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Power Investments Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Production Services UK Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group Properties Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group UK Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Wood Group/OTS Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 100
Wood International Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 100
Pyeroy Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 95
Wood Group Industrial Services Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 95
WG Intetech Holdings Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 90
Wood Group Intetech Limited Compass Point, 79-87 Kingston Road, Staines, TW18 1DT 90
Fast Reactor Technology Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 51
SgurrControl Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 51
WGPSN Eurasia Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 50
USA
AGRA Foundations Inc
Amec Foster Wheeler Programs, Inc.
The Corporation Trust Company, 1209 Orange Street, Wilmington DE 19801
2475 Northwinds Parkway, #200-260, Alpharetta, GA, 30009
100
100
Barsotti's Inc. Perryville Corporate Park, 53 Frontage Road, PO Box 9000, Hampton, NJ, 08827-90000 100
MDIC Inc. 2730, Suite 100, Gateway Oaks Drive, Sacramento, Sacramento, CA, 95833 100
Terra Nova Technologies, Inc. 818 West Seventh Street, Ste. 930, Los Angeles, CA, 90017 100
MACTEC Constructors, Inc. 1105 Lakewood Parkway, Suite 300, Alpharetta, GA, 30009 100
MACTEC E&C, LLC 1675 Broadway, Suite 1200, Denver, CO, 80202 100
MASA Ventures, Inc. 1675 Broadway, Suite 1200, Denver, CO, 80202 100
AMEC Construction Management, Inc. The Corporation Trust Company,  1209 Orange Street, Wilmington, DE, 19801 100
AMEC Developments, Inc. The Corporation Trust Company,  1209 Orange Street, Wilmington, DE, 19801 100
AMEC Earth & Environmental LLP The Corporation Trust Company,  1209 Orange Street, Wilmington, DE, 19801 100
AMEC Engineering and Consulting of Michigan, Inc. 46850 Magellan, Suite 190, Novi, MI, 48377 100
Amec Foster Wheeler Arabia Ltd. The Corporation Trust Company,  1209 Orange Street, Wilmington, DE, 19801 100
Amec Foster Wheeler Constructors, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Amec Foster Wheeler Environmental Equipment Company, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Amec Foster Wheeler Industrial Power Company, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Amec Foster Wheeler Kamtech, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Amec Foster Wheeler Martinez, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Amec Foster Wheeler North America Corp. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Amec Foster Wheeler Power Systems, Inc. The Corporation Trust Company,  1209 Orange Street, Wilmington, DE, 19801 100
Amec Foster Wheeler USA Corporation The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
AMEC Holdings, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
AMEC Newco LLC The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
AMEC Oil & Gas World Services, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
AMEC USA Holdco LLC The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
AMEC USA Holdings, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
AMEC USA Investments LLC The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Camden County Energy Recovery Corp. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Energia Holdings, LLC The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Equipment Consultants, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Andes, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Asia Limited The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Avon, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Development Corporation The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Energy Corporation The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Energy Manufacturing, Inc. Perryville Corporate Park, 53 Frontage Road, PO Box 9000, Hampton, NJ, 08827-9000 100
Foster Wheeler Finance LLC The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Hydrox, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Intercontinental Corporation The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler International LLC The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler LLC The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Maintenance, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Operations, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Real Estate Development Corp. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Realty Services, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Santiago, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler US Power Group Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Foster Wheeler Zack, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
FWPS Specialty Products, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
King Wilkinson, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
MACTEC E&C International, Inc. 1105 Lakewood Parkway, Suite 300, Alpharetta, GA, 30009 100
Process Consultants, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Thelco Co. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Tray, Inc. The Corporation Trust Company, 1209 Orange Street, Wilmington, DE, 19801 100
Amec Foster Wheeler Ventures, Inc. 1200, South Pine Island Road, Plantation, FL, 33324 100
Amec Foster Wheeler E&C Services, Inc. 1979 Lakeside Parkway, Suite 400, Tucker, GA, 30084 100
AMEC Industrial Programs, LLC 1105 Lakewood Parkway, Suite 300, Alpharetta, GA, 30009 100
MACTEC Consulting, LLC 1105 Lakewood Parkway, Suite 300, Alpharetta, GA, 30009 100
MACTEC Environmental Consultants, Inc. 1105 Lakewood Parkway, Suite 300, Alpharetta, GA, 30009 100
Sehold, Inc. 1979 Lakeside Parkway, Suite 400, Tucker, GA, 30084 100
Simons-Eastern Consultants, Inc. 1201 Peachtree Street NE, Atlanta, GA, 30361 100
MACTEC Architectural Services, Inc. 1105 Lakewood Parkway, Suite 300, Alpharetta, GA, 30009 100
AMEC Architectural, Inc. 511 Congress Street, Ste. 200, Portland, ME, 04101 100
AMEC Massachusetts, Inc. Suite 700, 155 Federal Street, Boston, MA, 02110 100
AMEC Michigan, Inc. 40600 Ann Arbor Road E, Suite 201, Plymouth, MI, 48170-4675 100
AGRA Holdings, Inc. 701 S. Carson Street, Suite 200, Carson City, NV, 89701 100
Amec Foster Wheeler Environment & Infrastructure, Inc. 701 S. Carson Street, Suite 200, Carson City, NV, 89701 100
AMEC North Carolina, Inc. 225, Hillsborough Street, Raleigh, NC, 27603 100
McCullough Associates, Inc. 2020 Winston Park Drive, Suite 700, Oakville, ON, L6H 6X7 100
4900 Singleton, L.P. 400 North St. Paul, Dallas, TX, 75201 100
Amec Foster Wheeler Oil & Gas, Inc. 1999 Bryan Street, Ste. 900, Dallas, TX, 75201-3136 100
Foster Wheeler Environmental Corporation 1999 Bryan Street, Ste. 900, Dallas, TX, 75201-3136 100
QED International LLC 1999 Bryan Street, Ste. 900, Dallas, TX, 75201-3136 100
Rider Hunt International (USA) Inc. 1999 Bryan Street, Ste. 900, Dallas, TX, 75201-3136 100
Altablue Inc. 2215-B Renaissance Dr., Las Vegas,  NV 89119 100
BMA Solutions Inc 211 E. 7th Street, Suite 620, Austin TX 78701 100
C E C Controls Company, Inc 601 Abbot Road, East Lansing, MI 48823 United States 100
Cape Software, Inc. 211 E. 7th Street, Suite 620, Austin TX 78701 100
Global Performance, LLC 1703 Laurel Street, Columbia,  SC 57501 100
Ingenious Inc. 211 E. 7th Street, Suite 620, Austin TX 78701 100
ISI Group, L.L.C. 211 E. 7th Street, Suite 620, Austin TX 78701 100
JWGUSA Holdings, Inc. 2711 Centerville Road,  Suite 400, Wilmington,  DE 19808 100
Kelchner, Inc. 1300 East 9th Street, Cleveland, OH 44114 100
Mitchell's Oil Field Services, Inc. 26 West Sixth Avenue, Helena, MT 59624 100
Mustang Engineering (North Carolina) PC 327 Hillsborough Street, Raleigh, NC 27603 100
Mustang Engineering Florida, Inc. 1200 South Pine Island Road, Plantation, FL 33324 100
Mustang International, L.P. 211 E. 7th Street, Suite 620, Austin TX 78701 100
Mustang Process and Industrial Inc. 2 Office Park Court, Columbia SC 29223 100
Mustang Subs GP, Inc. 2215-B Renaissance Dr., Las Vegas,  NV 89119 100
Mustang Subs LP, Inc. 2215-B Renaissance Dr., Las Vegas,  NV 89119 100
NDT Systems, Inc. 211 E. 7th Street, Suite 620, Austin TX 78701 100
Onshore Pipeline Engineering, D.P.C. 245 Park Avenue, New York, NY 10167 100
SgurrEnergy Inc. 2711 Centerville Road,  Suite 400, Wilmington,  DE 19808 100
Swaggart Brothers, Inc. 1127 Broadway St. NE, Ste 310, Salem,  OR 97301 100
Swaggart Logging & Excavation LLC 1127 Broadway St. NE, Ste 310, Salem,  OR 97301 100
Wood Group Alaska, LLC 1675 South State St, Suite B, Dover DE 19901 100
Wood Group E & PF Holdings, Inc. 2711 Centerville Road,  Suite 400, Wilmington,  DE 19808 100
Wood Group Mustang Holdings, Inc. 211 E. 7th Street, Suite 620, Austin TX 78701 100
Wood Group PSN, Inc. 2215-B Renaissance Dr., Las Vegas,  NV 89119 100
Wood Group Support Services, Inc. 2215-B Renaissance Dr., Las Vegas,  NV 89119 100
Wood Group US Holdings, Inc. 2215-B Renaissance Dr., Las Vegas,  NV 89119 100
Wood Group US International, Inc. 2215-B Renaissance Dr., Las Vegas,  NV 89119 100
Wood Group USA, Inc. 211 E. 7th Street, Suite 620, Austin TX 78701 100
Operations Analysis, Inc. 300 East Pine Street, Seattle, WA, 98122 100
Martinez Cogen Limited Partnership Perryville Corporate Park, 53 Frontage Road, PO Box 9000, Hampton, NJ, 08827-9000 99
Mustang of New Jersey, Inc. 830 Bear Tavern Road, West Trenton, NJ 08628 80
Perryville Corporate Park Condominium Association, Inc. Corporation Service Company, 830 Bear Tavern Road, West Trenton, Mercer, NJ, 08628 67
Vanuatu
O.T.S. Finance and Management Limited Law Partners House, Rue Pasteur, Port Vila 100
Overseas Technical Service International Limited Law Partners House, Rue Pasteur, Port Vila 100
Venezuela
Amec Foster Wheeler Venezuela, C.A. Avenida Francisco de Miranda, Torre Cavendes, Piso 9, Ofic 903, Caracas, Venezuela 100
Simco Avenida 5 de Julio, Ebtre avs. 3Ey3F, Edificio Geminis, Piso 5, Maracaibo 90
Virgin Islands, British
Wood Group Engineering (Colombia) Ltd. Geneva Place, 2nd Floor, 333 Waterfront Drive, PO Box 3339, Road Town, Tortola 100
Wood Group PDE Limited Geneva Place, 2nd Floor, 333 Waterfront Drive, PO Box 3339, Road Town, Tortola 100


*Companies consolidated for accounting purposes as subsidiaries on the basis of control.
 
Joint Ventures
Company name Registered Address Ownership Interest %
Azerbaijan
Socar-Foster Wheeler Engineering LLC 88A Zardaby Avenue,Baku, Azerbaijan 35
Australia
Clough AMEC Pty Ltd Level 2, 18-32 Parliament Place, West Perth, WA, WA 6005, Australia 50
Transcanada Turbines Australia Pty Limited 32 Murray Street, Perth WA 6000 50
Brazil
RWG Reparacao E Revisao Limitada Rua Dr Cincinato Braga 47, Unidade 1, Sao Bernardo do Campo, Sao Paulo 50
COPEL-AMEC S/C Ltda. Rua Carneiro Lobo, No. 468, conjuntos 1301 a 1303, Centro Empresarial Champs Elysees, Curitiba, State of Parana, Brazil 48
Brunei Darussalam
SKS Wood Sdn Bhd Lot No 23, G-25 Area, Simpang 81-4, Seria KB2533, PO Box 105, Seria KB1133, Negara 43
Canada
ABV Consultants Ltd. Suite 2300, Bentall 5, 550 Burrard Street, Vancouver, BC, V6C 2B5, Canada 50
AMEC Black & McDonald Limited 11 Frazee Avenue, Dartmouth, NS, B3B 1Z4, Canada 50
ODL Canada Limited 689 Water Street, St. John's,  NF A1E 1B5 50
Teshmont Consultants Inc. 1190 Waverley Street, Winnipeg, MB, R3T 0P4, Canada 50
Transcanada Turbines Ltd. TransCanada PipeLines Tower, 111 Fifth Avenue S.W., P.O. Box 1000, Station M, Calgary AB T2P 4KE 50
Vista-Mustang JV Corp. Suite B12, 6020 2nd Street S. E., Calgary AB T2H 2L8 50
SSBV Consultants Inc. 1200 Waterfront Centre, 200 Burrard Street, Vancouver, BC, V6C 3L6, Canada 33
Chile
CEJV Ingeniería y Construcción Limitada Av. Isidora Goyenechea 2800, Floor 32, Las Condes, Santiago, 7550647, Chile 50
Consorcio AMEC CADE / PSI Consultores Limitada Av. Jose Domingo, Canas No 2640, Nunoa, Santiago, 7750164, Chile 50
Consorcio de Ingeniería Geoconsult Cade Idepe Limitada Av. Jose Domingo, Canas No 2640, Nunoa, Santiago, 7750164, Chile 50
Consorcio de Ingeniería Systra Cade Limitada Av. Jose Domingo, Canas No 2640, Nunoa, Santiago, 7750164, Chile 50
Consorcio TNT Vial y Vives D Chile Limitada Ave. Santa Maria 2810, Providencia, Santiago, Chile 50
Construcciòn e Ingenierìa Chile FI Limitada Avenida Andrés Bello 2711, Piso 22 - Comuna Las Condens, Santiago, Chile 50
Consorcio Consultor Systra / Cade Idepe / Geoconsult Limitada Av. Jose Domingo, Canas No 2640, Nunoa, Santiago, 7750164, Chile 40
Construcciòn e Ingenieria FIM Chile,Limitada Avenida Santa Maria 2810, Comuna de Providencia, Santiago, Chile 33
China
Amec Foster Wheeler Power Machinery Company Limited No.1, Fuhui Road, Xinhui District, Jiangmen City, Guangdong Province, China 52
SZPE Amec Foster Wheeler Engineering Co., Ltd No. 143 Jinyi Road, Jinshan District, Shanghai, 200540, China 50
Foster Wheeler (Hebei) Engineering Design Co., Ltd. CEFOC Information Mansion, Zhongshan West Road No. 356, Shijiazhuang, China 49
Cyprus
Wood Group - CCC Limited Elenion Building, 2nd Floor, 5 Themistocles Street, CY-1066 Nicosia 50
France
Momentum SNC 70 Boulevard de Courcelles, 75017 Paris, France 33
Italy
Voreas S.r.l. Via S. Caboto 15, Corsico, Milan, 20094, Italy 50
Centro Energia Ferrara S.r.l. Via Andrea Doria 41/G, Rome, 00192, Italy 42
Centro Energia Teverola S.r.l. Via Andrea Doria 41/G, Rome, 00192, Italy 42
Kazakhstan
PSN KazStroy JSC Satpayev str. 46, Atyrau 50
Malaysia
AMEC Larastia Sdn. Bhd. No.8.03, 8th Floor, Plaza First Nationwide, 161, Jalan Tun H.S.Lee, 50000 Kuala Lumpur, Malaysia 49
RWG OTEC Sdn. Bhd. No 39-1, Jalan 9/62A, Bendar Menjalara, Kepong, 52200 Kuala Lumpur, Wilayah Persekutuan 25
Mexico
AFWA DUBA Salina Cruz, S. de R.L. de C.V. Carlos Salazar, #2333, Colonia Obrera, Monterrey, Nuevo Leon, Mexico 50
Mustang Diavaz, S.A.P.I. de C.V. Av. Revolucion 468, Col. San Pedro de los Pinos Mexico, D.F. 50
Netherlands
AJS v.o.f. Verkeerstorenweg 3, 1786 PN Den Helder, Netherlands 50
Runway Omega B.V. Kosterijland 20, 3981 AJ, Bunnik, Netherlands 50
New Zealand
Beca AMEC Limited Ground Floor, Beca House, 21 Pitt Street, Auckland, 1010, New Zealand 50
Qatar
AMEC Black Cat LLC 5th Floor Al Aqaria Tower, Building No. 34, Museum Street, Old Salata Area, Street 970, Zone 18, P.O Box No. 24523 Doha, Qatar 49
Spain
Isolux Monenco Medio Ambiente S.A. Calle Juan Bravo, 3-C, Madrid, 28006, Spain 49
Saudi Arabia
AMEC BKW Arabia Limited Al Rushaid Petroleum Investment Co. Building, Prince Hamoud Street, PO Box 31685 – Al Khobar 31952, Saudi Arabia 50
Amec Foster Wheeler Energy and Partners Engineering Company Karawan Towers, South Block, King Faisal Road, Al-Khobar, Saudi Arabia 50
Singapore
AFWDEC Engineering and Construction Pte. Ltd. 1 Marina Boulevard, #28-00, One Marina Boulevard, 018989, Singapore 50
Clough AMEC SEA Pte Ltd 991E Alexandra Road, #01 - 25, 119973, Singapore 50
South Korea
AMEC Partners Korea Limited KT Building 11F, 14 Yeouidaero, Youngdeungpo-gu, Seoul 07320, Korea, Republic of 54
Trinidad and Tobago
Massy Wood Group Ltd. 3rd Floor, Tatil Building, 11A Maraval Road, Port of Spain 50
United Arab Emirates
Foster Wheeler Kentz Energy Services DMCC PO Box 26593, Unit 3601, Tiffany Tower, Cluster W, Jumeirah Lakes Towers, Dubai, United Arab Emirates 50
Foster Wheeler Kentz Oil & Gas Services DMCC Unit No: 2H-05-230 Jewellery & Gemplex 2, Plot No: DMCC-PH2-J&GPlexS Jewellery & Gemplex, Dubai, United Arab Emirates 50
United Kingdom
EthosEnergy Group Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 51
Fast Reactor Technology Limited
F. & N.E. Limited
Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England
Croft Road, Crossflatts, Bingley, West Yorkshire, BD16 2UA
51
50
F.& N.E. (1990) Limited Croft Road, Crossflatts, Bingley, West Yorkshire, BD16 2UA 50
PWR Power Projects Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 50
South Kensington Developments Limited Portland House, Bickenhill Lane, Solihull, Birmingham, B37 7BQ, England, United Kingdom 50
UK Nuclear Restoration Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 50
Lewis Wind Power Holdings Limited EDF Energy, GSO Business Park, East Kilbride, G74 5PG, Scotland 50
Stornoway Wind Farm Limited EDF Energy, GSO Business Park, East Kilbride, G74 5PG, Scotland 50
Uisenis Power Limited EDF Energy, GSO Business Park, East Kilbride, G74 5PG, Scotland 50
Northern Integrated Services Limited Ground Floor, 15 Justice Mill Lane, Aberdeen, AB11 6EQ 50
RWG (Repair & Overhauls) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 50
TransCanada Turbines (UK) Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 50
Sulzer Wood Limited 15 Justice Mill Lane, Aberdeen, AB11 6EQ 49
Ship Support Services Limited Drayton Hall, Church Road, West Drayton, UB7 7PS 47
Nuclear Management Partners Limited Booths Park, Chelford Road, Knutsford, Cheshire, WA16 8QZ, England 36
ACM Health Solutions Limited Carillion House, 84 Salop Street, Wolverhampton, WV3 0SR, England 33
Road Management Services (A13) Holdings Limited Carillion House, 84 Salop Street, Wolverhampton, WV3 0SR, England 25
Road Management Services (A13) plc Carillion House, 84 Salop Street, Wolverhampton, WV3 0SR, England 25
USA
AMEC - SAI Joint Venture, LLC 701 S. Carson Street, Suite 200, Carson City, NV, 89701 50
Core Tech - Amec Foster Wheeler, LLC Suite 180, 751 Arbor Way, Blue Bell, PA, 19422-1951 50
Nan - Amec Foster Wheeler, LLC 98-1238 Kaahumanu St., Suite 400, Pearl City, HI, 96782 50
RWG (Repair & Overhauls) USA, Inc. 2711 Centerville Road,  Suite 400, Wilmington,  DE 19808 50
TransCanada Turbines, Inc. 2215-B Renaissance Dr., Las Vegas,  NV 89119 50
FluorAmec, LLC 1105 Lakewood Parkway, Suite 300, Alpharetta, GA, 30009 49
Flour Amec II, LLC 100 Fluor Daniel Drive, Greenville, SC, 29607-2770 45
Boldt Amec LLC 2525 North Roemer Road, Appleton, WI, 54912 40
Energy Logistics, Inc. 160 Greentree Drive, Suite 101, Dover, DE 19904 33
Venezuela
OTEPI FW, S.A. Zona Rental Universidad Metropolitana, Edificio Otepi, Terrazas del Avila, Caracas 1070, Edo Miranda, VE 50
Associates
Company name Regsitered Address Ownership interest %
Canada
Teshmont Consultants LP 1190 Waverley Street, Winnipeg, MB, R3T 0P4, Canada 30
Teshmont GP Inc. 1190 Waverley Street, Winnipeg, MB, R3T 0P4, Canada 30
Iran
Foster Wheeler Adibi Engineering 9th Floor Aluminumm Building, Avenue Shah, Tehran 45
Oman
AMEC Al Turki LLC Al Alawi, Mansoor Jamal & Co., Barristers & Legal Consultants, Muscat International Centre, Mezzanine Floor, Muttrah Business District, P.O. Box 686 Ruwi, Oman 35

Details of the direct subsidiaries of John Wood Group PLC are provided in note 1 to the parent company financial statements.

The Group will be exempting the following companies from an audit in 2017 under Section 479A of the Companies Act 2006. All of these companies are fully consolidated in the Group Financial Statements.

AFW E&C Holdings Limited (Registered number 9861564)

AFW Hungary Limited (Registered number 9861581)

Amec Foster Wheeler Finance Asia Limited (Registered number 6205760)

Amec Foster Wheeler Property and Overseas Investments Limited (Registered number 1580678)

Amec Hedge Co 1 Limited (Registered number 7870120)

Amec Kazakhstan Holdings Limited (Registered number 4530056)

Amec USA Finance Limited (Registered number 5299446)

Amec USA Holdings Limited (Registered number 4041261)

Amec USA Limited (Registered number 4044800)

Amec Wind Developments Limited (Registered number 8781332)

Atlantis Hedge Co 1 Limited (Registered number 9302428)

Atlantis Hedge Co 2 Limited (Registered number 9302562)

FW Chile Holdings 2 Limited (Registered number 9861563)

Kelwat Investments Limited (Registered number SC203212)

Sandiway Solutions (No 3) Limited (Registered number 5318249)

Sigma Financial Facilities Limited (Registered number 3863449)

Wood Group Engineering and Operations Support Limited (Registered number SC159149)

JWGUSA Holdings Limited (Registered number SC178512)

Wood Group Investments Limited (Registered number SC301983)

Wood International Limited (Registered number SC202031)

Shareholder information

Payment of dividends

The Company declares its dividends in US dollars.  As a result of the shareholders being mainly UK based, dividends will be paid in sterling, but if you would like to receive your dividend in US dollars please contact the Registrars at the address below.  All shareholders will receive dividends in sterling unless requested.  If you are a UK based shareholder, the Company encourages you to have your dividends paid through the BACS (Banker’s Automated Clearing Services) system.  The benefit of the BACS payment method is that the Registrars post the tax vouchers directly to the shareholders, whilst the dividend is credited on the payment date to the shareholder’s Bank or Building Society account.  UK shareholders who have not yet arranged for their dividends to be paid direct to their Bank or Building Society account and wish to benefit from this service should contact the Registrars at the address below.  Sterling dividends will be translated at the closing mid-point spot rate on 20 April 2018 as published in the Financial Times on 21 April 2018.

Officers and advisers

Secretary and Registered Office                      Registrars                            

M McIntyre                                                          Equiniti Limited
John Wood Group PLC                                      Aspect House
15 Justice Mill Lane                                            Spencer Road
Aberdeen                                                            Lancing
AB11 6EQ                                                           West Sussex
                                                                            BN99 6DA

Tel: 01224 851000                                             Tel: 0871 384 2649

Stockbrokers                                                      Independent Auditors

JPMorgan Cazenove Limited                              PricewaterhouseCoopers LLP
Credit Suisse                                                       Chartered Accountants and Statutory Auditors
                                                                            The Capitol
                                                                            431 Union Street
                                                                            Aberdeen
                                                                            AB11 6DA

Company Solicitors

Slaughter and May

Financial calendar

Results announced 20 March 2018
Ex-dividend date 19 April 2018
Dividend record date 20 April 2018
Annual General Meeting 11 May 2018
Dividend payment date 17 May 2018

The Group’s Investor Relations website can be accessed at www.woodgroup.com.


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Final Results for the year to 31 December 2017 - RNS