WorleyParsons’ Shares Tumbled On ASX Despite Announcing The Completion Of Retail Entitlement Offer

  • Nov 12, 2018 AEDT
  • Team Kalkine
WorleyParsons’ Shares Tumbled On ASX Despite Announcing The Completion Of Retail Entitlement Offer

On 12 November 2018, WorleyParsons Limited (ASX: WOR) announced the successful completion of the retail component of its 1 for 1.47 accelerated non-renounceable pro-rata entitlement offer of new WorleyParsons shares. Following the release of this news, the share price of the company decreased by 0.493 percent as on 12 November 2018.

The Retail Entitlement Offer raised approximately $1.1bn at $15.56 per share and together with the institutional component of the Entitlement Offer, the total amount raised under the Entitlement Offer is around $2.9bn. The company received around $571m of applications under the Retail Entitlement Offer, including entitlements taken up by Dar Group, resulting in a take-up rate of 51% in the Retail Entitlement Offer. The new shares issued under the Retail Entitlement Offer will rank equally in all respects with existing shares, and they are expected to be allotted on 15 November 2018. 

The company is planning to use the part of the proceeds from the entitlement offer to fund the acquisition of Jacobs Engineering Group Inc.’s Energy, Chemicals and Resources division. In the month of October, the company entered into a binding agreement to acquire Jacobs Engineering Group Inc.’s Energy, Chemicals and Resources division for cash and a debt-free enterprise value of US$3.3 billion. It is expected that this transaction will deliver around 20 percent EPS accretion on an FY 2018 pro-forma basis. And it is expected that through this transaction, the company will achieve run-rate cost synergies of approximately A$130 million per annum within two years.

Recently, the company announced that it has been awarded a frame agreement for engineering and construction (E&C) services under which the company will provide E&C services to assets in the central and southern North Sea. The company has also been awarded an engineering, procurement, and construction (EPC) contract in the UK with ConocoPhillips U.K and under the contract, the company will be providing EPC services for a subsea tieback project to an existing platform. Recently, the company also announced that Rosenberg WorleyParsons has been awarded an EPCI contract by Lundin Norway. As per the contract, the services include planning, engineering, prefabrication, offshore installation, and commissioning support.

In FY 2018, the aggregated revenue of the company increased by 8.5 percent to $4,749.2 million as compared to last year. The EBIT margin increased by 2.6pp to 5.6 percent and EBIT of the company increased by 103.5 percent to $263.8 million in FY18. The Net profit after tax increased by 85.7 percent to $62.2 million and the basic earnings per share increased by 73.9 percent to 23.3 cents. The cash flow from operations increased by 229.2 percent to $259.7 million.

In the last six months, the share price of the company decreased by 2.14 percent as on 9 November 2018, traded at a PE level of 65.320x. WOR’s shares traded at $15.080 with a market capitalization of circa $5.93 billion as on 12 November 2018 (AEST 2:04 PM).


Disclaimer

The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkinemedia.com and associated websites are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.

 

 

All pictures are copyright to their respective owner(s).Kalkinemedia.com does not claim ownership of any of the pictures displayed on this website unless stated otherwise. Some of the images used on this website are taken from the web and are believed to be in public domain. We have used reasonable efforts to accredit the source (public domain/CC0 status) to where it was found and indicated it below the image.

 

There is no investor left unperturbed with the ongoing trade conflicts between US-China and the devastating bushfire in Australia.

Are you wondering if the year 2020 might not have taken the right start? Dividend stocks could be the answer to that question.

As interest rates in Australia are already at record low levels, find out which dividend stocks are viewed as the most attractive investment opportunity in the current scenario in our report.

CLICK HERE FOR YOUR FREE REPORT!
   
x
We use cookies to ensure that we give you the best experience on our website. If you continue to use this site we will assume that you are happy with it. OK