The Financial Conduct Authority (FCA) has imposed a fine of nearly £13 million on Wood Group for publishing inaccurate financial information. The breaches specifically relate to the company's full-year results for 2022 and 2023, and its half-year results for 2024. The regulator concluded that Wood failed to exercise reasonable care to ensure these announcements were not false or misleading.

Nature of the Breaches and Contributing Factors

The FCA determined that Wood's accounting judgements were improperly influenced by a desire to maintain previously stated financial results following poor performance on certain projects. Furthermore, the company lacked adequate systems, controls, and procedures to prevent this from happening.

Investigation and Penalty Details

The FCA's investigation covered a period from 1 January 2023 to 7 November 2024, which overlapped with an independent review Wood had commissioned from Deloitte in 2024. Wood fully cooperated with the nine-month investigation, accepted the findings, and consequently qualified for a 30% reduction in the financial penalty. Without this discount, the fine would have been £18,562,500. The company must pay the reduced fine of £12,993,700 by 17 March.

Wood's Response and Remedial Actions

Wood acknowledged the conclusion of the investigation, stating the FCA's findings are consistent with those of the independent review it commissioned. The company has developed a remediation and governance action plan to address the identified issues and has begun implementing it, a step noted by the FCA.

Context of the Pending Sidara Takeover

The announcement of the fine precedes a scheduled court hearing on 6 March to rule on the proposed takeover of Wood by Sidara, a UAE-based engineering group. Wood expects the deal to take effect around 10 March if approved. The FCA investigation was announced before Wood's board agreed to Sidara's £216 million offer in late August. A Wood spokesperson declined to comment on whether the penalty would impact the pending takeover, which remains subject to several conditions.