Energy, chemicals and resources company Worley's profit has leapt 40 per cent as it starts delivers the benefits of its purchase of Jacob's energy, chemicals and resources division
Worley has also doubled its interim dividend and raised its cost synergy target from the acquisition of Jacob’s energy, chemicals and resources division for $US3.2 billion in April 2019.
New chief executive Chris Ashton said the company had been focused on delivering the benefits of the ECR acquisition at a cost of $81 million in the first half.
“We have increased our cost synergy target to $175 million per annum, delivered over 30 months from completion, ” he said on Monday as he started in the role following the retirement of Andrew Wood.
Worley’s initial estimate was about $130 million to $150 million in cost savings from IT, property and business overheads after the merger.
There will be a one-off cost of about $125 million for delivering the synergy target, plus capital expenditure of $15 million, Worley said on Monday.
There will also be modernisation costs of about $40 million and $35 million capital expenditure associated with that.
Mr Ashton said Worley was seeing more consistent earnings through increased exposure to operational expenditure and the chemical sector against a background of strengthened market conditions.
Revenue has risen 134 per cent to $5.99 billion in the first half after the businesses were merged to employ more than 59,000 people in 51 countries.
The company will pay an unfranked 25 cent dividend, double the distribution at the same time last year.
Worley’s shares were up 22.5 cents, or 1.6 per cent, at $14.305 at 1401 AEDT.