Amec, the engineering group that serves the oil, gas and power generation industries, is hoping to more than double its earnings per share to more than 100p in five years’ time, it said today, as part of a development strategy known as Vision 2015.
The group, which in the past few years has been transforming itself from an engineering conglomerate to a group more focused on the energy sector, said that it would concentrate more on growth.
By 2015, revenues are expected to grow ahead of the 8 per cent annual compound average achieved since 2006, the group said.
The rate of increase in margin improvement was expected to be more gradual than it has been in recent years, it added.
In August, Amec’s operating margin rose to 7.5 per cent from 6 per cent in the previous year — an improvement powered by cutting 2,500 jobs over the past year, by increasing prices and by the decision to source more goods and services from lower-cost suppliers in Asia, Eastern Europe and Mexico.
Although the group warned that it expected the external environment to remain “challenging” in 2010, it said that it was on track to deliver its margin target of 8.5 per cent.
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Samir Brikho, the chief executive of Amec, said: “Following the successful transformation of Amec over the last three years, Vision 2015 clearly sets out the next phase of our development, with a shift of focus to assured growth.”
In addition, the group hopes to increase levels of investment, following its acquisition of Philips, the specialist Canadian civil engineering consultant, in March this year, as well as Arcas Consulting Archeologists in Canada, and Journeaux, Bedard, a Canadian mining consultancy.
In August, the group saw a 4.5 per cent drop in pre-tax profits at its half-year results, at £88.4 million profit on flat revenues of £1.26 billion.
At the time, it increased its dividend by 15 per cent to 6.1p a share and as part of Vision 2015, will pursue a “progressive approach” to dividends.
Shares in Amec have gained almost 70 per cent this year and climbed 6 per cent this week in advance of the Vision 2015 presentation, which will take place today and outline further details of the strategy.
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However shares in the company fell today, losing 6p to 818.5p.