Shares in John Wood Group have slumped after the engineering group announced an independent review of its business would be conducted by Deloitte.

The Financial Times reported that shares in the Aberdeen-headquartered firm slipped by more than 50% after the company published a Q3 trading update in which it described a “mixed” quarter.

John Wood’s revenue was $1.49bn in Q3, representing growth of 1% compared to $1.48bn in Q3 last year, with strong growth in its operations business offsetting lower revenue in consulting and projects.

However, revenue for the first nine months of the year-to date reached $4.33bn, which is around 3% lower than the same period last year. John Wood said this reflected lower revenue in its projects business following a shift away from large-scale EPC work and lower pass-through activity.

As a result, John Wood revealed that its board has agreed to commission an independent review of the company to be performed by Deloitte.

This review will focus on reported positions on contracts in the firm’s projects, accounting, governance and controls operations, including whether any prior year restatement may be required.

John Wood CEO, Ken Gilmartin, commented: “The increasing quality of our business is evidenced by higher pricing, expanded margins and a higher share of our pipeline from sustainable solutions.

“It was, however, a mixed quarter for group performance. We saw strong year-on-year growth in operations and margin expansion in consulting.

“Our projects business delivered a disappointing quarter, impacted by delayed awards in our chemicals business and our continued weakness in minerals and life sciences. As such, we continue to take actions to redress this underperformance.”

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