WorleyParsons shares are being hammered

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The end of the mining boom is still hitting WorleyParsons hard, but the bottom may be near.

The engineering services group today posted a half year loss of $2.4 million for the six months to December and decided not to pay a dividend to shareholders. Revenue was down 35% to $2.72 billion.

A short time ago, its shares had dropped 11.2% to $8.750.

CEO Andrew Wood says substantial progress has been made in cutting internal costs and improving customer delivery.

The company is heading to $450 million in annualised savings by the end of the current financial year.

WorleyParsons says market conditions remain challenging but customer sentiment is improving.

“They inform the company that their activity levels are not expected to deteriorate further,” says Wood.

“In some areas, they are beginning to increase activity, which the company expects to flow through in the medium term.

“The benefit of the cost reductions achieved by the company in the first half, are expected to be reflected in second half earnings.”

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