Wood Group announces acquisition of PSN. Creating the world leading production services business

Transcription

1 13 December 2010 Wood Group announces acquisition of PSN Creating the world leading production services business John Wood Group PLC ( Wood Group ), the international energy services company, has entered into an agreement to acquire PSN Limited ( PSN ) for a total enterprise value of US$955 million (the Acquisition ). PSN will merge with Wood Group s Production Facilities business to create the leading global brownfield production services provider, Wood Group PSN. PSN is an international energy services company employing over 8,000 people worldwide and operating in 23 countries. In the year to 31 December 2010, PSN is expected to generate approximately US$100 million of EBITDA on revenues of approximately US$1,200 million. PSN s Chief Executive Officer ( CEO ), Bob Keiller, will become CEO of the combined production services business and the deputy CEO will be Les Thomas, currently CEO of Wood Group Production Facilities. On completion, Bob will join the Wood Group Board alongside Les Thomas. The Acquisition of PSN advances Wood Group s strategy of maintaining an appropriate balance between oil & gas development and later cycle production support, creating global market leading positions, developing long term customer relationships, extending services and broadening international reach. 1

2 Wood Group PSN will be a global leader in brownfield production services and be well positioned for growth across the oil & gas industry through: increased exposure to, what the Directors currently believe to be a global production services addressable market in excess of US$50 billion per annum; strengthening Wood Group s brownfield production services operations in many of its current locations and expanding into a number of important new locations; extending and deepening strong long term customer relationships. It will position the enlarged group as a trusted production services provider to the International Oil Companies, with major customers including BP, Chevron, Conoco Phillips, ExxonMobil, Marathon, Shell and Total and to a large number of independent operators including Centrica, Hess, Nexen, Premier and Talisman, and as a key partner to a number of National Oil Companies including Gazprom and TAQA; the combination of two proven management teams and a global workforce of over 22,000 people; comprehensive support through the life cycle of oil & gas facilities, with an unrivalled track record in the key brownfield engineering & construction and operations & maintenance segments. Wood Group PSN will also have specialist expertise in pre-operations support, commissioning, training, asset integrity and decommissioning. Commenting on the Acquisition, Allister Langlands, Chief Executive of Wood Group, said: "Wood Group PSN will have a larger footprint, deeper resources and capabilities and, by selecting best practices, be able to deliver additional added value to our customers. The combined business will be better positioned to help tackle current key industry issues, including operational assurance, competency, reliability and asset integrity." 2

3 Bob Keiller, CEO of PSN, who will lead Wood Group PSN, said: I believe that by uniting PSN with Wood Group Production Facilities we have a unique opportunity to grow our business to benefit our customers and our people. Since the management buyout in 2006, we have achieved significant success and expansion. This transaction positions us for the next stage of PSN s development, enabling us to strengthen our service capability to existing and new customers whilst providing enhanced career prospects for our people. Wood Group PSN will retain our clear commitment to safety, excellence in service delivery, innovation and continuous improvement, allowing us to continue to build lasting and strong relationships with clients. The Acquisition will be significantly earnings and cash flow enhancing immediately following completion. 1 The Acquisition is subject to relevant anti-trust approvals and completion is expected in the second quarter of Prior to completion, both Wood Group and PSN will continue to operate as separate entities. Wood Group's other businesses in Engineering, Well Support and Gas Turbine Services will be unaffected by the Acquisition. This summary should be read in conjunction with the full text of the announcement. -Ends- 1 The earnings and cash flow enhancing calculations exclude the impact of any fair value adjustments. 3

4 Enquiries: There will be an analysts meeting to discuss the Acquisition at 10 am today at J.P. Morgan Cazenove, 20 Moorgate, London EC2R 6DA. Wood Group Allister Langlands, Chief Executive Alan Semple, Group Finance Director Nick Gilman, Group Head of Communications & Investor Relations Tel: +44 (0) J.P. Morgan Cazenove (Financial Adviser and Corporate Broker) Michael Wentworth-Stanley Robert Constant Tel: +44 (0) Credit Suisse (Financial Adviser and Corporate Broker) James Leigh-Pemberton Tristan Lovegrove Tel: +44 (0) Brunswick (Public Relations) Patrick Handley Nina Coad Tel: +44 (0)

5 Notes to editors 1. Wood Group Wood Group is an international energy services company with US$5 billion of revenues, employing more than 29,000 people and operating in 50 countries. The Group has three divisions - Engineering & Production Facilities, Well Support, and Gas Turbine Services - providing a range of engineering, production support, maintenance management and industrial gas turbine overhaul and repair services to the oil & gas, and power generation industries worldwide. Further information is available at 2. PSN PSN is an international energy services company with over US$1 billion of revenues, employing over 8,000 people worldwide and operating in 23 countries. The business is organised into three geographical operating regions: UK, Americas, and International operations. PSN provides brownfield services to customers operating in the oil & gas industry. PSN operated within the KBR division of Halliburton until In 2006 it was purchased by its current management, Bank of Scotland Integrated Finance and certain other institutional investors. Further information is available at 3. Analyst Presentation An analysts meeting to discuss the Acquisition will be held at am today at J.P. Morgan Cazenove, 20 Moorgate, London EC2R 6DA Those unable to attend in person can listen to the presentation via conference call or live webcast. Access to the webcast is via Conference call details are available from Brunswick on +44 (0) Cautionary Statement This announcement has been issued by, and is the sole responsibility of, Wood Group. No representation or warranty express or implied, is or will be made as to or in relation to, and no responsibility or liability is or will be accepted by J.P. Morgan plc or Credit Suisse Securities (Europe) Limited ( Credit Suisse ) or by any of their affiliates or agents as to or in relation to, the accuracy or completeness of this announcement or any other written or oral information made available to or publicly available to any interested party or its advisers and any liability therefore is expressly disclaimed. J.P. Morgan plc, which conducts its UK investment banking business as J.P. Morgan Cazenove and is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting for Wood Group and for no one else in connection with the matters set out in this announcement and the Acquisition and will not be responsible to anyone other than Wood Group for providing the protections afforded to clients of J.P. Morgan plc nor for providing advice in relation to the Acquisition or any matters set out in this announcement. Credit Suisse is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting for Wood Group and for no one else in connection with the matters set out in this announcement and the Acquisition and will not be responsible to anyone other than Wood Group for providing the protections afforded to clients of Credit Suisse nor for providing advice in relation to the Acquisition or any matters set out in this announcement. Neither Credit Suisse nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, 5

6 under statute or otherwise) to any person who is not a client of Credit Suisse in connection with this announcement, any statement contained herein or otherwise. This announcement contains (or may contain) certain forward-looking statements with respect to Wood Group's current expectations and projections about future events. These statements, which sometimes use, but are not limited to, words such as "anticipate", "believe", "intend", "estimate", "expect" and words of similar meaning, reflect the directors' beliefs and expectations and involve a number of risks, uncertainties and assumptions that could cause actual results and performance to differ materially from any expected future results or performance expressed or implied by the forward-looking statement. Statements contained in this announcement regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The information contained in this announcement is subject to change without notice and, except as required by applicable law, neither Wood Group, J.P. Morgan Cazenove nor Credit Suisse assumes any responsibility or obligation to update publicly or review any of the forward-looking statements contained herein. You should not place undue reliance on forward-looking statements, which speak only as of the date of this announcement. Nothing in this document should be construed as a profit forecast or be interpreted to mean that the future earnings per share, profits, margins or cash flows of Wood Group will necessarily be greater than the historic published figures. 6

7 John Wood Group PLC ( Wood Group ) announces acquisition of PSN Limited ( PSN ) Creating the world leading production services business 1. Details of the Acquisition Wood Group, the international energy services company, is to acquire PSN from certain institutional investors and members of its existing management, for a total enterprise value of US$955 million (the Acquisition ). The consideration payable to the shareholders will be US$627 million, made up of a combination of cash and Wood Group shares. The new Wood Group shares, with a value of US$80 million 2, will be issued at completion to the management vendors 3 and to PSN s Employee Benefit Trust ( EBT ). In addition, Wood Group will finance PSN s net debt position, along with certain other adjustments, which in total aggregate to US$328 million. Further details on the financing of the Acquisition are laid out in Section 8 of this announcement. PSN is an international production services company employing over 8,000 people worldwide and operating in 23 countries. In the year to 31 December 2009, PSN generated US$84 million of EBITDA on revenues of US$1,151 million and its gross assets were US$513 million. PSN provides life of field support to oil & gas facilities, through brownfield engineering modifications, production enhancement, operations management, maintenance management and decommissioning services (taken together, Production Services ). 2. Background to and reasons for the Acquisition Wood Group s strategy is to achieve long term sustainable growth by adding value to its customers operations. The Acquisition of PSN develops Wood Group in line with its strategy of maintaining an appropriate balance between oil & gas development and later cycle production support, creating global market leading positions, developing long term customer relationships, extending services and broadening international reach, and merges two strong and successful Production Services businesses with highly capable and respected management teams. The Directors believe that, as oil and gas fields mature, there will be a growing need for Production Services, which represents an attractive global addressable market, currently believed by the Directors to be in excess of US$50 billion per annum. Following the Acquisition, the enlarged Wood Group (the Enlarged Group ) will have revenues of over US$6 billion, approximately 36,500 employees and operate in over 55 countries. The Directors believe that Wood Group PSN made up of the Production Facilities activities of Wood Group and PSN, will be the leading global Production Services million new Wood Group shares at a price of 483 pence per share. Assumes a USD/GBP rate of Management vendors and family trusts. 7

8 organisation, with over 22,000 people, around US$3 billion in annual revenue and operating in over 30 countries. Proven management and international workforce The Directors believe that Wood Group PSN will have successful and proven management, together with a global workforce with leading knowledge and experience focused on meeting customers evolving needs in the Production Services arena. A management team will be formed drawing on the complementary strengths of Wood Group s Production Facilities and PSN s management teams, to deliver the planned growth of Wood Group PSN. The Directors also believe that the global market leadership position will help Wood Group PSN to offer improved development opportunities for its people and that the broadened international presence will help in attracting talent to meet local resource needs. Extends and deepens Wood Group s strong long term customer relationships Wood Group PSN will draw on the customer relationships of PSN (including, among others, those with BP, ExxonMobil, Gazprom, Nexen, Sakhalin Energy and Shell). The combined relationships of Wood Group s Production Facilities business and PSN will position Wood Group PSN as a trusted provider to the International Oil Companies ( IOCs ), with major customers including BP, Chevron, Conoco Phillips, ExxonMobil, Marathon, Shell and Total; a large number of independent operators, including Centrica, Hess, Nexen, Premier and Talisman; and as a key partner for a number of National Oil Companies ( NOCs ), including Gazprom and TAQA. The Directors believe that Wood Group PSN will be well positioned to support its customers in their home markets and as they develop their businesses internationally. Broadens Wood Group s international presence Wood Group PSN will have a broader geographic reach across oil & gas markets, including a presence in key growth markets. The Acquisition of PSN will extend and deepen Wood Group s Production Facilities operations in many of its current locations and expand Wood Group Production Facilities business into several new key growth markets. Region Wood Group Production Facilities* PSN* Wood Group PSN * UK North Sea 47% 29% 40% North America 18% 24% 20% Latin America 12% - 7% Middle East & Africa 11% 7% 10% Caspian region and Russia - 18% 8% Asia Pacific 12% 22% 15% * Proportion of expected 2011 revenues In line with Wood Group s strategy, the Acquisition will reduce the proportion of revenues Wood Group Production Facilities derives from the UK North Sea which, given the higher margins achieved in other markets, will provide an improved margin mix. UK North Sea In the UK North Sea, which represents around 50 per cent. of Wood Group s Production Facilities business and around 30 per cent. of PSN s business, Wood Group PSN will have well-established positions and a strong track record of helping customers maximise recovery from their assets. 8

9 North America Wood Group Production Facilities and PSN each support a broad range of operators in the US shallow water and onshore markets. The Acquisition further develops, through the increased scale and number of relationships, the capability of Wood Group PSN to offer support to the emerging Gulf of Mexico deepwater operations market. In Canada, Wood Group s onshore presence and PSN s greater exposure to the offshore market will create a strong Production Services provider for both offshore and onshore developments. Caspian region and Russia PSN s activities in Azerbaijan and Kazakhstan will help develop Wood Group PSN s presence in the Caspian region. In Russia, Wood Group s presence in Moscow, and via PSN, in Sakhalin and the Arctic regions, also provides a platform for Wood Group PSN to continue to grow activities. Asia Pacific In Australia, Wood Group Production Facilities West Coast and coal seam methane focus, combined with PSN s East Coast, Bass Strait and refining support expertise will create a market leader in the growing Australian market. PSN s activities in Bangladesh, India, the Philippines and Vietnam will also complement Wood Group Production Facilities activities in Brunei and Indonesia. Africa PSN s activities in Cameroon, Chad, Egypt, Gabon and Tunisia will complement Wood Group Production Facilities activities in Algeria, Angola, Equatorial Guinea, Ghana, Libya, Nigeria, South Africa and Uganda. Latin America Wood Group PSN will have a broad capability in Brazil, Colombia, Peru and Trinidad. Middle East In the Middle East, both Wood Group Production Facilities and PSN are continuing to pursue a number of opportunities and Wood Group PSN will be well placed to continue to grow its business in the region. The increased geographic coverage will significantly enhance Wood Group PSN s ability to support customers wherever they operate. Comprehensive service offering Both Wood Group Production Facilities and PSN have strong reputations and track records in key brownfield engineering & construction and operations & maintenance segments and Wood Group PSN will be able to offer comprehensive support through the life cycle of oil & gas facilities. Wood Group PSN will also have particular strengths in commissioning, preoperations support, UK duty holder services, training, asset integrity and decommissioning. Overall, the Directors believe that the track record and comprehensive service offering will significantly enhance the position of Wood Group PSN to win new business and contracts. 3. Information on Wood Group and PSN Wood Group Wood Group is an international energy services company with approximately US$5 billion in revenues in the last financial year, employing approximately 29,000 people worldwide and operating in 50 countries. Wood Group is organised into three divisions Engineering & Production Facilities, Well Support and Gas Turbine Services providing a range of engineering, production support, maintenance management and industrial gas turbine overhaul and repair services to the oil & gas and power generation industries worldwide. The Engineering & Production Facilities division represented around 66 per cent. of Wood Group s 9

10 revenue and Production Facilities was 57 per cent. of Engineering & Production Facilities revenue for the year to 31 December PSN PSN is an international energy services company with over US$1 billion in revenues in the last financial year, employing over 8,000 people worldwide and operating in 23 countries. PSN provides life of field support to oil & gas facilities, through brownfield engineering modifications, production enhancement, operations management, maintenance management and abandonment services. The business is organised into three geographical operating regions: UK, Americas, and International operations. PSN operated within the KBR division of Halliburton until In 2006, it was purchased by its current management, Bank of Scotland Integrated Finance and certain other institutional investors. The trading record of PSN for the three years ended 31 December 2009 and the forecast for the year ended 2010 is summarised below: US$ million 12 months to 31 December 2007A 12 months to 31 December 2008A 12 months to 31 December 2009A 12 months to 31 December 2010F Revenue 1,204 1,241 1,151 c.1,200 Adjusted EBITDA*¹ c.100 Adjusted EBITA**¹ c.95 * Earnings before interest, taxation, depreciation and amortisation ** Earnings before interest, taxation and amortisation ¹Adjusted for exceptional items representing one-off legal and other professional fees associated with reviews of the corporate structure and preparatory work on strategic corporate developments. The exceptionals were US$(1.2) million, US$(6.0) million and US$(0.5) million in the 12 months to 31 December 2007, 2008 and 2009 respectively. Figures for 2007 to 2009 in the above table have been derived from the consolidated audited financial statements of PSN prepared under IFRS for the years ended 31 December 2007, 2008 and For the 12 months to 31 December 2010, the Directors are expecting revenue of approximately US$1,200 million and EBITDA of approximately US$100 million which reflects the strong trading conditions across PSN s UK, Americas and International businesses. During 2010, wins in the UK include the Shell Brent Decommissioning and Shell Integrated Services Contracts. In its Americas business, PSN has won the Hebron Development Contract in Eastern Canada. In its International business, PSN secured a commissioning contract for AGIP KCO Kashagan in Kazakhstan and a maintenance contract for the Caltex Refinery in Eastern Australia. 4. Strategy for Wood Group PSN Wood Group PSN will retain the clear commitment of Wood Group Production Facilities and PSN to execution excellence, innovation, safety and continuous improvement, ensuring that it adapts to the challenges that its customers face. The Directors believe that this should enable Wood Group PSN to continue to build lasting and positive relationships. Wood Group will look to ensure that it applies its deep knowledge of Production Services to help deliver greenfield engineering designs in its Engineering business that continue to maximise operating efficiency over the life of the asset. Wood Group will also continue to offer its oil & gas rotating equipment reliability and availability services in the support of installed gas turbines and other rotating equipment linked to oil & gas production. 10

11 Wood Group PSN will maintain a focus on organic growth and selected acquisitions in key markets to develop its service offering and broaden its international reach. For example, Wood Group PSN will continue to invest in developing its capabilities in unconventional gas, including coal seam methane, and the renewable energy markets. 5. Financial effects of the Acquisition The Acquisition is expected to be significantly earnings and cash flow enhancing for the Enlarged Group immediately following completion. 4,5 In addition, the ROIC is expected to exceed Wood Group s WACC in the first year following completion of the Acquisition. 6 The Acquisition is expected to achieve around US$15 million per annum of long run synergies from a reduction in operational overheads and corporate costs in the third year following completion of the Acquisition. In the first year the net synergies are not expected to be material and in the second year they are expected to be around US$10 million. As a result of the Acquisition, the Directors are expecting pro forma net debt to EBITDA for 31 December 2010 to be approximately 1.8 times, with rapid deleveraging due to the strong cash flow generation profile of the combined group People PSN s Chief Executive Officer ( CEO ), Bob Keiller, will become CEO of the combined production services business and the deputy CEO will be Les Thomas, currently CEO of Wood Group Production Facilities. On completion, Bob will join the Wood Group Board alongside Les Thomas. Bob Keiller and Les Thomas will create a transition team, drawn from certain of the senior managers of both Wood Group Production Facilities and PSN, to manage integration planning in the period prior to completion of the Acquisition. Bob Keiller has entered into a service contract with Wood Group (conditional upon completion of the Acquisition) which provides for an initial term of 2 years from completion and thereafter can be terminated on six months notice. The service contract includes customary restrictive covenants and is otherwise in line with the service contracts of the current Directors. Aside from Bob Keiller, the other key executives from PSN, all of whom will be joining Wood Group PSN, include Duncan Skinner, Peter Brown, Alistair Green, Dean Hunter, John Kearney, Zeffrey Lucas, Jerome Lynch and Bill Nicholson. The roles and positions of the key managers will be determined by the transition team. 4 This statement does not constitute a profit forecast and should not be interpreted to mean that earnings of Wood Group in the first full year following the Acquisition, nor in any subsequent period, will necessarily match or be greater than those for any preceding financial year. 5 The earnings and cash flow enhancing calculations exclude the impact of any fair value adjustments. 6 Return on Invested Capital ( ROIC ) is calculated post tax and post inclusion of US$15 million of long run synergies; Weighted Average Cost of Capital ( WACC ). 11

12 7. Principal terms of the Acquisition Wood Group has conditionally agreed to acquire the shares in PSN held by certain institutional investors and the management vendors. In accordance with the provisions of PSN s articles of association, as part of the arrangements, Wood Group will acquire the PSN shares held by the trustees of PSN and certain minority investors. The consideration has been determined by reference to the balance sheet of PSN as at 31 August There will be no adjustment to the consideration for PSN s net debt or working capital at completion. Key terms of the Acquisition include: completion of the Acquisition agreement is conditional upon obtaining UK merger control approval from the OFT or the Competition Commission and Hart Scott Rodino merger control approval in the US; Wood Group has agreed certain termination rights, including in the event of a Material Adverse Effect; the management vendors have undertaken not to dispose of their consideration shares for two years from completion, subject to customary carve outs; and Wood Group has agreed to pay a break fee to PSN of US$6.3 million if completion does not occur due to a failure to obtain US or UK merger control approval. 8. Financing the Acquisition The Acquisition will be financed by a combination of debt and Wood Group shares. Below is a summary of the Acquisition sources and uses: US$ million Source of funds Use of funds External bank debt¹ 875 Shareholder consideration² 627 New equity to management vendors 80 PSN net debt and certain 328 and trustees of PSN s EBT³ adjustments 4 Total 955 Total 955 ¹ Wood Group will draw upon existing bilateral facilities and has entered into additional committed term and revolving credit facilities with Lloyds TSB. ² Due to the time between announcement and completion, Wood Group will pay up to US$19 million in additional consideration to PSN s shareholders. As a result, the potential maximum consideration payable is US$646 million. The cash component of the shareholder consideration will be settled by payment of up to 185 million and up to US$274 million on completion at a USD/GBP exchange rate of 1.58 to the selling shareholders. ³ 10.5 million consideration shares (subject to adjustment for dilutive events prior to completion) will be issued at completion to the vendors who are employees and managers of PSN and the trustees of PSN s EBT, with a consideration value of US$80 million (at an exchange rate of USD/GBP of 1.58) representing approximately 30 per cent of their total consideration. The new Wood Group shares will be issued at 483 pence per share. 4 Wood Group will finance PSN s net debt position, along with certain other adjustments, which in total aggregate to US$328 million. 12

13 9. Financial advice J.P. Morgan Cazenove and Credit Suisse are acting as Joint Financial Advisers and Joint Corporate Brokers to Wood Group in connection with the Acquisition. 13

14 Enquiries: Wood Group Allister Langlands, Chief Executive Alan Semple, Group Finance Director Nick Gilman, Group Head of Communications & Investor Relations Tel: +44 (0) J.P. Morgan Cazenove (Financial Adviser and Corporate Broker) Michael Wentworth-Stanley Robert Constant Tel: +44 (0) Credit Suisse (Financial Adviser and Corporate Broker) James Leigh-Pemberton Tristan Lovegrove Tel: +44 (0) Brunswick (Public Relations) Patrick Handley Nina Coad Tel: +44 (0) Cautionary Statement This announcement has been issued by, and is the sole responsibility of, Wood Group. No representation or warranty express or implied, is or will be made as to or in relation to, and no responsibility or liability is or will be accepted by J.P. Morgan plc or Credit Suisse Securities (Europe) Limited ( Credit Suisse ) or by any of their affiliates or agents as to or in relation to, the accuracy or completeness of this announcement or any other written or oral information made available to or publicly available to any interested party or its advisers and any liability therefore is expressly disclaimed. J.P. Morgan plc, which conducts its UK investment banking business as J.P. Morgan Cazenove and is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting for Wood Group and for no one else in connection with the matters set out in this announcement and the Acquisition and will not be responsible to anyone other than Wood Group for providing the protections afforded to clients of J.P. Morgan plc nor for providing advice in relation to the Acquisition or any matters set out in this announcement. Credit Suisse is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting for Wood Group and for no one else in connection with the matters set out in this announcement and the Acquisition and will not be responsible to anyone other than Wood Group for providing the protections afforded to clients of Credit Suisse nor for providing advice in relation to the Acquisition or any matters set out in this announcement. Neither Credit Suisse nor any of its subsidiaries, branches or affiliates owes or accepts any duty, liability or responsibility whatsoever (whether direct or indirect, whether in contract, in tort, under statute or otherwise) to any person who is not a client of Credit Suisse in connection with this announcement, any statement contained herein or otherwise. This announcement contains (or may contain) certain forward-looking statements with respect to Wood Group's current expectations and projections about future events. These statements, which sometimes use, but are not limited to, words such as "anticipate", "believe", "intend", "estimate", "expect" and words of similar meaning, reflect the directors' beliefs and expectations and involve a number of risks, uncertainties and assumptions that could cause actual results and performance to differ materially from any expected future results or performance expressed or implied by the forward-looking statement. Statements contained in this announcement regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The information contained in this 14

15 announcement is subject to change without notice and, except as required by applicable law, neither Wood Group, J.P. Morgan Cazenove nor Credit Suisse assumes any responsibility or obligation to update publicly or review any of the forward-looking statements contained herein. You should not place undue reliance on forward-looking statements, which speak only as of the date of this announcement. Nothing in this document should be construed as a profit forecast or be interpreted to mean that the future earnings per share, profits, margins or cash flows of Wood Group will necessarily be greater than the historic published figures. 15