Worley Limited has significantly increased its FY26 earnings forecast headwind from the Middle East conflict to up to $60 million, up from its previous estimate of $30-40 million. The doubling of the expected impact signals that disruption to the company’s operations in the region has proven substantially deeper than originally anticipated.
While Worley acknowledges recent progress toward resolving the Middle East conflict, including a memorandum of understanding and ongoing negotiations to open the Strait of Hormuz, the company notes that meaningful uncertainty persists. The conflict continues to disrupt existing projects, with no cancellations announced to date but customers deferring the start and award of new work. This pullback in new project activity reflects caution among clients, who appear reluctant to commit capital until the region’s security and geopolitical situation stabilizes.
For Worley shareholders, the revised downgrade carries material implications. A $60 million reduction to underlying EBITA directly reduces earnings available for distribution, particularly important for investors who rely on the company for income. The size of the upward revision also highlights the limited visibility the company has into customer decision-making and project timelines in the Middle East, adding to uncertainty around the timing of project activity resumption.
Beyond the Middle East disruption, Worley faces an additional headwind from foreign exchange movements. The strengthening Australian dollar in the second half of FY26 will reduce reported underlying EBITA by an estimated $50 million when overseas earnings are converted to Australian currency. This translation effect is typical for globally-operating companies with earnings across multiple currencies, but compounds the pressure on reported profitability for the current financial year.
The combined impact of geopolitical disruption and foreign currency translation totals approximately $110 million in headwinds for FY26 reported results. Investors should monitor new contract awards and project commencement timelines when Worley releases full-year earnings, as these will indicate whether momentum in the Middle East is beginning to recover. Additional focus should be placed on management commentary regarding customer sentiment and investment intentions in the region, as this will determine whether the $60 million impact represents a one-time disruption or a sign of longer-term structural challenges. This announcement is price sensitive and flagged as material by the ASX.
View the full ASX announcement (PDF)
About Worley Limited (ASX: WOR)
Worley Limited is an engineering and professional services company that provides consulting and project delivery expertise to the energy, chemicals, and resources sectors. The company offers services including engineering, procurement, construction, asset performance management, and digital solutions. Worley operates globally across the Americas, Europe, the Middle East, Africa, Australia, Asia Pacific, and China, with headquarters in Sydney, Australia.
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