Wood Group has held a capital markets to outline its refreshed strategy, including new medium-term targets.
The engineering and consulting business also gave an update on trading during the first 10 months of the year, describing it as in line with expectations.
As for full-year numbers, Wood expect revenues to be between $5.2bn and $5.5bn, with adjusted earnings before tax to be around the middle of the guidance range of $370m and $400m.
This is after the negative impact from recent exchange rate movements, which hit revenue by circa $200m revenue and took off around $10m in earnings.
New chief executive Ken Gilmartin said: "Today is an important moment for Wood as we set out our refreshed strategy.
"There is huge potential in Wood - we have over 35,000 highly skilled colleagues, long-term client relationships and leading engineering and consulting capabilities.
"We are now taking a more focused approach to growth, targeting specific priority markets across energy and materials that best match our competitive strengths - this tighter focus will help ensure we can grow both profitably and sustainably."
He explained that the group's turnaround is progressing and was accelerated by the sale of its built environment consulting division, as well as wider work to focus on lower risk, reimbursable work.
"We have addressed legacy issues and our strong balance sheet will allow us to deal with the defined schedule of resulting cash outflows," continued Gilmartin.
"Our strategy will deliver returns for our shareholders and today we have set out new financial targets, including to grow EBITDA by mid to high single digit CAGR over the medium term, with momentum building over time as our strategy delivers."
Based on the cash generative nature of Wood's underlying businesses, he also stated that positive free cash flow - after the impact of legacy cash outflows - from 2024 onwards.
The capital markets day heard that a new leadership team has addressed the reasons for historical underperformance, most notably by improving project discipline and selectively focusing on reimbursable and low-risk contract work.
The energy and materials markets were identified as offering "significant growth opportunities", while approximately 22% of revenue now comes from solutions across decarbonisation, energy transition and materials for a net zero world
The focus over the medium term is on large markets with solid growth - namely oil, gas and chemicals - alongside small markets with substantial growth potential - like hydrogen and carbon capture - as well as larger markets where market share can be grown - noting minerals and life sciences.
The combination of these should result in Wood's revenue outperforming the combined market compound annual growth rate of around 5% over the medium term.
Earnings margins are expected to be flat in the nearer term, partly as Wood reinvests in the business to secure growth. Over the medium term, earnings are expected to grow at mid to high single digit rates.
The trading update added that Wood will look to manage its target leverage over the medium term within a range of around 0.5 to 1.5 times net debt - excluding leases - to earnings, with banking covenants set at 3.5x.
Net debt is expected to be around $350m to $400m at the end of this year, including the recent settlement of the Enterprise litigation case for $115m and the normalisation of working capital.
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