AGM TRADING STATEMENT Proposed sale of AMEC SPIE and overall trading on track


Highlights of the AGM statement

  • Proposed sale of AMEC SPIE expected around mid-2006 at an attractive profit
  • Overall trading* for 2006 in line with earlier expectations

AMEC, the international project management and services company, is holding its annual general meeting at 10.30am today in London, UK. At the meeting, chief executive Sir Peter Mason will update shareholders on the strategic restructuring of the group and will confirm that overall trading* remains in line with the board's earlier expectations. Highlights of his address to shareholders are set out below.

* For the AMEC group as currently structured

Strategic restructuring
First round bids have been received for AMEC SPIE and the board continues to expect an attractive profit on the sale. The transaction is expected to be signed around the middle of the year. The board continues to work on the separation of the continuing businesses and will update shareholders on progress following the sale of AMEC SPIE.

Sir Peter Mason, who is due to retire in September 2006, will continue as chief executive of AMEC until later this year when his successor is expected to be appointed.

Trading Update
The Multitechnical Services business in Continental Europe has had a good start to the year and order intake remains ahead of sales.

We continue to see generally strong market conditions in the Environmental Services business and further recovery in AMEC's North American industrial markets. As previously reported, our activities in Iraq will continue during 2006, but at a reduced level. For the year to-date, activity levels in Iraq have been running ahead of our earlier expectations.

Oil and gas markets remain robust and the Oil and Gas business has had a strong start to the year. Our activities in minerals and metals mining, which are reported in this segment and which had an outstanding year in 2005, have had a better start to the year than was previously anticipated.

Better than expected performance in the Engineering and Technical Services and Oil and Gas segments has been offset by disappointing trading in the UK Construction Services business. In late 2005, significant management changes were made in this business and additional steps have recently been taken to strengthen further its project delivery capabilities.

Order intake in the Engineering and Technical Services business continues to grow, whilst the order book in Oil and Gas and Project Solutions remains unchanged on the position at 31 December 2005, standing at £2.9 billion.

Net debt
Average weekly net debt for 2006* remains on track to reduce to around £400 million.

The board maintains its earlier expectations at the time of AMEC's preliminary results in March for overall* progress in 2006.

* For the AMEC group as currently structured

Chief executive, Sir Peter Mason, said:
"We are making solid progress with the first stage of our strategic restructuring and expect the prospective sale of AMEC SPIE to generate an attractive profit for our shareholders.

"Our major markets are generally strong and we remain on track to deliver overall performance this year in line with our earlier expectations."

A telephone conference call for analysts and investors will be held at 8.30am today.

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