Amec beats forecasts but warns revenue growth is set to slow

SHARES in oil engineer Amec sank yesterday as it warned revenue growth this year would be lower than expected.

Strong growth in conventional oil and gas markets would be offset by softening demand in the mining market and reduced oil sands revenue, the FTSE engineer – which designs and builds infrastructure for the oil and gas, mining, nuclear and renewable energy sectors – said yesterday.

Despite the disappointing outlook, Amec posted an 11 per cent rise in annual earnings to £331m, thanks to a surge in revenue from oil and gas activity, prompting it to pledge a 20 per cent hike in the dividend to 36.5p per share.

Nuclear power is set to be a growing focus for blue chip Amec, as it aims to diversify away from traditional oil and gas markets. Chief financial officer Ian McHoul told City A.M. yesterday that nuclear energy was “an important part of the equation” going forward for the company.

Shares closed down 7.3 per cent yesterday at 1,042p, making Amec the biggest faller on the blue chip index.