Worley job cuts hit 10,300

WorleyParsons shareholders targeted long-serving director Erich Fraunschiel in a protest vote at today’s annual meeting, where the engineering giant disclosed it has cut a further 900 jobs over the past three months.

The Sydney-based company said it employed 30,500 people as of September, down from a figure of 31,400 included in its 2015 annual results announcement.

The global company’s headcount peaked at 40,800 in 2012, before it was battered by the downturn in the mining and petroleum markets.

Chief executive Andrew Wood said the company would incur redundancy and related costs of $20 million to $30 million in the current half year.

Shareholders lodged substantial protest votes against two resolutions, with the biggest ‘no’ vote being against the re-election of Mr Fraunschiel.

On a poll, 17.8 per cent of votes were cast against the re-election of Mr Fraunschiel, who has been a non-executive director since 2003.

Prior to the meeting, proxy advisers had recommended a vote against re-election on the basis that Mr Fraunschiel's long tenure meant he was no longer an 'independent' director.

The poll also showed 7.9 per cent of votes cast were against the granting of share performance rights to Mr Wood.

Mr Fraunschiel was the highly-regarded finance director at Wesfarmers up to 2002, and since then has been a non-executive director at companies including Woodside Petroleum, WA Newspapers, Foodland Associated and Rabobank Australia.

He joined the board of property investor BWP Trust early this year, and it is intended that he will become chairman after the retirement this year of John Austin.

Mr Wood told today’s meeting that market conditions for WorleyParsons’ customers would remain uncertain for at least the remainder of the 2016 financial year.

"We expect trading conditions to remain difficult in the resource infrastructure market as both the hydrocarbons and minerals and metals sectors re-evaluate new project viability in an era of low commodity prices," he said.

Mr Wood said this would be partially offset by opportunities in power generation, ports, passenger rail and water.

WorleyParsons is freezing executive fixed pay for 2015-16, with Mr Wood agreeing to take a 10 per cent pay cut from July this year.

The company made a $54.9 million loss in 2014-15, dragged down by $198.6 million of goodwill write-downs.

WorleyParsons shares dropped 44 cents, or 6.2 per cent, to $6.65.