WorleyParsons has cut its profit forecast in half as the global commodity price meltdown hits the Australian engineering group.
The company, which is losing business as its oil industry customers pull out of projects, is cutting 2,000 jobs and will need to pay out $125 million in redundancy and other costs.
“As a result of the sustained weakness in commodity prices, WorleyParsons has experienced deterioration in workload since February,” the comnpany said.
The company now expects statutory earnings for the second half to be about 50% of the first six months of the 2015 financial year.
Cost cutting of between $75 million to $100 million will flow through to the 2016 financial year.
The company reported revenue weaker by 4.7% to $3.614 billion for the first half. Underlying profit was up 3.6% to $100.7 million.
Worley Parsons shares are down around 9% to $10.20.