Worley (ASX:WOR) used its half-year results call for FY2026 to highlight revenue growth, resilient earnings and a sharp lift in bookings, while executives detailed a cost reset program aimed at improving earnings quality and supporting a broader growth strategy that expands the company’s addressable market.
First-half performance: revenue up, earnings steady
Chief executive officer Chris Ashton said the first half was defined by “solid revenue growth and resilient earnings” despite what he described as dynamic markets. Aggregated revenue increased 5.4% from the prior corresponding period to AUD 6.3 billion, while underlying EBITA was steady at AUD 377 million, according to chief financial officer Justine Travers. Underlying NPATA was AUD 207 million.
Cash performance was a focus of the call. Travers reported normalized cash conversion of 95.5% and said disciplined working capital management supported strong operating cash flow. Days sales outstanding were 46.2 days, which she said remained within target.
Bookings surge and backlog remains resilient
Management emphasized the step-up in awards during the period. Ashton said bookings were up 63% from the prior six-month period, totaling AUD 9.8 billion. He pointed to Venture Global CP2 Phase 1 as a major contributor and cited additional wins including EPC for ConocoPhillips Scandinavia on the Norwegian Continental Shelf, FEED work for OQ Refineries and Petroleum Industries’ decarbonization project at the Sohar Refinery in Oman, and construction work for ExxonMobil’s reconfiguration project in Baytown, Texas.
Backlog was described as resilient at AUD 6.7 billion, providing revenue visibility into the second half of FY2026 and into 2027. Ashton said the backlog was slightly lower than June 2025 due to delivery timing rather than demand. The company added AUD 6.3 billion to backlog through scope increases and project wins during the period, and management said project wins early in calendar 2026 are expected to add more than AUD 3.5 billion more.
One notable project discussion centered on ExxonMobil’s Baytown Blue project. Ashton said work is paused but not canceled, and therefore remains in backlog. He said Worley applies a “very rigorous process” to what stays in, or comes out of, backlog.
Sector trends: Energy and Resources grow while Chemicals softens
Ashton outlined mixed conditions across end markets. In Energy, aggregated revenue increased 8.8%, driven by major projects moving into execution and higher construction, fabrication, and procurement activity, particularly in the Americas. Integrated gas was highlighted as a key growth driver and represented 25% of total revenue in the period, with Ashton referencing LNG work across Germany, Indonesia, Australia, and the U.S. He said the oil outlook remained softer overall, with activity increasingly concentrated in higher-margin offshore projects and selected onshore developments, including shale. He also described Power as an important growth market across gas-fired generation, renewables, and nuclear.
Chemicals revenue declined 9% over the period, with Ashton citing project cancellations in Western Europe and lower professional services activity across APAC and EMEA. This was partially offset by major project execution activity in the Americas. Ashton said refined fuels remained promising, while petrochemicals continued to be a major contributor but were impacted by Western European closures tied to global overcapacity. He added that low-carbon fuels offered more selective opportunities where projects are commercially viable.
In Resources, aggregated revenue increased 12.3% and now represents 29% of the business. Ashton pointed to fertilizers as the largest subsector, supported by food security and population growth, and noted demand for copper tied to energy transition materials and rising data center, cloud, and AI infrastructure demand. He also said battery materials activity and sentiment had improved, with a focus on front-end work and technology commercialization.
Cost reset and operating model changes
Worley’s executives framed the restructuring as part of a broader effort to remove complexity, improve efficiency, and scale its Global Integrated Delivery (GID) model. Travers said the company is targeting more than $100 million of annualized savings from FY2027 onward as an “exit run rate.” She said some benefits may begin to flow in the second half of FY2026, but characterized FY2027 as the primary period when the reset becomes evident.
On questions about the higher-than-expected restructuring cost in the first half, Ashton said both the scale and cost exceeded initial expectations and were driven by Western Europe severance costs and the time required to complete actions. He also said management used the program as a catalyst to accelerate shifting work from higher-cost locations to lower-cost delivery centers such as India and Bogota.
Travers said the decision to treat the transformation and restructuring costs “below the line” was intended to provide a clearer view of underlying operating performance and improve comparability between periods, describing it as a typical treatment for such costs historically at Worley and among peers.
Capital returns, leverage, and outlook reconfirmed
Travers said the board declared an interim dividend of AUD 0.25 per share, which she described as unfranked. Worley is also continuing its share buyback program of up to AUD 500 million. As of Dec. 31, 2025, the company had repurchased more than 24 million shares for AUD 324 million.
Leverage at the end of the half was 1.5x, which Travers said was comfortably within the target range. She added that Worley is considering options for a euro medium-term note maturity due at the end of the year and said the company was confident it is well placed to manage the June maturity. Travers also flagged that foreign exchange could be a headwind in the second half if the Australian dollar remains at recent levels.
On the outlook, management reconfirmed the moderate growth guidance previously provided. Ashton said Worley is targeting higher aggregated revenue growth than FY2025 and growth in underlying EBITA on a constant-currency basis. The company expects underlying EBITA margin, excluding procurement, to be within 9% to 9.5%.
During Q&A, Ashton also discussed customer sentiment, saying the “tone has shifted” entering calendar 2026 compared with late 2025 uncertainty around tariffs. He identified ongoing softness in conventional chemicals in Western Europe due to overcapacity, but said he saw renewed interest across integrated gas, power, and resources. He also said sole-source work increased to 48%, which he attributed to improving customer confidence.
About Worley (ASX:WOR)
Worley Limited provides professional project and asset services to energy, chemicals, and resources sectors worldwide. The company offers digital, consulting, engineering and design, construction management, construction and fabrication, supply chain management, project management, and operation and maintenance services, as well as maintenance, modification, and operation services. It serves new energy, power, upstream and midstream, refining and chemicals, and infrastructure markets, as well as mining, minerals, and metals markets.
