Delivering a more
sustainable world
ANNUAL REPORT 2022
worley.com
Worley: A global company,
headquartered in Australia
We are a leading global provider of professional
project and asset services in the energy, chemicals
and resources sectors.
We are driven by a common purpose…
…delivering a more sustainable world.
We are Australia’s largest exporter of knowledge‑based services. We use this position
to support our customers with solutions to the challenges they face. This is how we
can best support sustainable development and is a consistent theme throughout our
Annual Report.
We are also delivering on our own sustainability commitments and strengthening our
own ESG performance. Our commitments are detailed in the ESG disclosures section.
Contents
Overview
Sustainability
Group highlights
Chair’s letter
Board of Directors
CEO's letter
Group Executive
2
4
7
11
13
17
Operating and financial review
Directors’ report
XX
XX
Context and strategy
Remuneration report
18
Operating and Financial Review 50
XX
Directors' Report
The world we operate in
Financial statements
18
Operations
Our purpose, ambition and values 20
Performance
Shareholder information
How we create value
22
ESG disclosures
Our current business
Glossary
24
Outlook
Our strategy
Corporate information
25
Risk management
How we define our sustainability
related work
27
Market outlook and case studies 30
XX
XX
XX
XX
50
58
74
103
104
Remuneration Report
Financial statements
Shareholder information
Glossary
Corporate information
116
126
156
212
213
217
Worley acknowledges and pays respect to the past, present and future Traditional Custodians of Country throughout Australia and extends this
acknowledgement and respect to First Peoples in all countries in which we operate. In Australia, it is Aboriginal and Torres Strait Islander Peoples
who have cared for and sustained this land, its animals, plants and waters for more than 60,000 years. We recognize the continuation and
importance of cultural, spiritual and educational practices of Aboriginal and Torres Strait Islander Peoples.
Artwork by Baard Baniol artist Marlie Albert from Broome, Western Australia, for Worley.
Our business value drivers
This year, we've integrated our sustainability content throughout
the Annual Report.
Sustainability includes the work we do for our customers as well as our own commitments. As part of this year's change, we
have included an ESG disclosures section within the Operating and Financial Review, detailing our own commitments. This is
represented by a green tab and can be found from page 74. The sustainability work we do for our customers is defined and
showcased throughout all other sections. This is part of a shift towards reporting in alignment with the International Integrated
Reporting () Framework which describes various forms of capital that organizations commonly depend upon to create value.
We have grouped and defined these capitals into business value drivers to structure our disclosures, outlined below.
Finance
(Financial capital)
Active capital management from diverse and
competitive sources, driving business growth
and value for our investors.
Knowledge, technology and data
(Intellectual capital)
What we know – our brand, execution
methodologies, intellectual property, data,
technology, knowledge and insights –
together driving efficiency and productivity.
Equipment and fabrication
(Manufactured capital)
Manufactured equipment and modules for
the Energy, Chemicals and Resources sectors,
supporting delivery of critical infrastructure.
Environment
(Natural capital)
How we consider the environment
with all stakeholders, stewarding
environmental sustainability.
People
(Human capital)
How we support and include our global team to
safeguard and enhance their well‑being, helping
them to drive sustainable impact.
Communities
(Social and relationship capital)
Strong relationships within our sectors ‑ with
our people, customers, investors, communities
and governments ‑ building trust and license
to operate.
Our material issues for FY2022
In this report, you’ll find disclosures about our material sustainability issues
in accordance with the Global Reporting Initiative (GRI) Standards: Core option.
Our assessment also identified other issues that are important to our
stakeholders and to our business. You’ll see our action on these UN Sustainable
Development Goals (SDGs) as they apply to the work we do for our customers,
noted throughout this report. We also describe these in relation to how we run
our business in the ESG disclosures section.
See our Materiality assessment (see page 56) and ESG data center1
for more information.
Refer to disclaimer on the inside back cover.
1 https://www.worley.com/sustainability/esg‑data‑center.
Progressing sustainable development
Our assessment identified the following four
UN SDGs that are material to Worley and
our stakeholders.
1
Annual Report 2022 Sustainability
We've come a long way on our journey
to delivering a more sustainable world
We are supporting our customers on their sustainability
journeys and operating consistent with our purpose.
2013
Included sustainability content
in our Annual Report
Launched our WorleyParsons
Foundation (renamed Worley
Foundation in 2019)
2011
Released our Corporate
Responsibility policy
2017
Commenced reporting
to GRI Standards
Adopted UN SDGs
2015
Conducted third‑party
limited assurance of
ESG metrics
Commenced voluntary
reporting of our tax activities
and contributions globally
20101
Launched EcoNomicsTM to support
sustainability in project decision‑
making and design
Commenced our first
year of CDP reporting
2012
Became a signatory to the
UN Global Compact
2016
Set our first corporate
energy‑reduction target
2014
Launched our group‑wide
energy efficiency program
1 All years for our sustainability journey are presented as calendar year.
2
Worley 2021
Established our Company ambition to realize our purpose
(see page 21)
Commenced reporting on revenue from
sustainability related work (see page 27)
Joined the Business Ambition for 1.5°C
Became an industry partner of Princeton Andlinger
Center for Energy and the Environment (see page 96)
Set a net‑zero by 2050 target for our Scope 3 emissions
Issued the first ASX sustainability‑linked bond
Published our first Group Modern
Slavery Statement
Committed to $100m strategic investment
in organic growth (see page 28)
2019
Established our Waste
Warriors employee network
Supported climate change
research through the Worley
Foundation
2022
Updated engineering design
specifications to embed
sustainability thinking (see page 102)
Expanded our Scope 3 Emissions
disclosures (see page 77)
Took action from the findings of
our inclusion survey (see page 93)
Strengthened ESG in our
remuneration framework
(see page 130)
Achieved above 10,000
staff‑learning accreditations in
sustainability‑related topics
Launched our updated Climate
Change Position Statement
(see page 75)
Piloted our Appreciate program, our
peer‑to‑peer values recognition
program (see page 92)
3,300+
project experiences in energy
transition to date
3
2018
Released our Climate Change
Position Statement
Launched our
Responsible Business
Assessment Standard
(including carbon emissions)
Commenced reporting
under the Taskforce on
Climate‑related Financial
Disclosures (TCFD)
2020
Released our new Company purpose
Revised our Climate Change
Position Statement
Set our net‑zero Scope 1 and
Scope 2 emissions targets for 2030
Launched our Sustainable
Solutions process
Launched our Reflect Reconciliation
Action Plan in Australia
Commenced work towards
Progressive Aboriginal Relations
(PAR) certification in Canada
Annual Report 2022 Group highlights
Delivering our ambition
Our people
We energize and
empower our people to
drive sustainable impact
Our portfolio
We are our customers' most
trusted partner, providing
best-in-class solutions
Our planet
We partner with customers
as stewards of a more
sustainable world
Achievements
• Over 33,000+ digital and sustainability‑related
learning accreditations issued
• Well managed voluntary turnover, slightly
under the industry average
• Piloted two inclusion programs with over
460 of our leaders
• 85% of our people trained on data privacy
and cyber security
Achievements
• Underlying EBITA margin of 6.0%, up from
5.3% in June 2021
• $3.2b sustainability aggregated revenue
(35% of total), up from $2.8b at 30 June 2021
• Backlog at $15.4b, up from $14.3b at
30 June 2021
• 56% of global factored sales pipeline in
sustainability, up from 47% at June 2021
Achievements
• Strengthened our ESG disclosures in line
with leading practice
• Launched our updated Climate Change
Position Statement
• On track to meet our 2030 Scope 1
and Scope 2 net‑zero commitment
• Developed second thought leadership
paper with Princeton to be released in early
September 2022
Key performance indicators
47%
Graduates recruited were women
up from 46% in FY2021
0.06
Serious case frequency rate
(SCFR)
down by 0.01 since in FY2021
Key performance indicators
80%
Of our top 20 customers
by revenue have net-zero
commitments
14%
Growth in gross margin delivered
in sustainability projects from
FY2020
Key performance indicators
29%
Scope 1 and Scope 2
emissions reduction
from FY2021
11 out of 13
Applicable Scope 3 Categories of
the Greenhouse Gas Protocol we
are now reporting on
Expanded our Scope 3
reporting from FY2021
We use select ESG key performance indicators as part of our remuneration framework. Read more on page 130.
Our ESG recognition
AAA
Rated by MSCI
Sixth consecutive
year
B
CDP score
“Management” grade,
up from C in FY2021, now
exceed global average
Sustainability
leader
Sustainability Leaders
List for 2022
Recognized 'category innovator'
in Australian Financial Review
ISO 27001
Certified and aligned
to ACSC
Essential 8 Maturity Model
4
Image taken by Ketankumar Gandhi, Piping Engineer, as part of our Earth Day photo competition
Worley Financial performance at a glance5
$9,065m
$449m
Aggregated revenue
EBITA
$243m
NPATA
$316m
Cash flow from operations
$m
Aggregated revenue1
EBITA
EBITA margin
NPATA
Net profit margin
Cash flow from operations2
Return on equity
Basic EPS normalized (cents)3
Basic EPS (cents)
Dividends (cents per share)
2018
4,749
278
5.9%
73
1.5%
260
6.8%
27.1
22.6
25
2019
6,439
308
4.8%
173
2.7%
236
5.1%
41.3
36.4
27.5
20204
11,249
481
4.3%
239
2.1%
829
5.1%
45.9
30.3
50
20214
8,774
319
3.6%
157
1.8%
533
3.1%
30.1
15.7
50
2022
9,065
449
5.0%
243
2.7%
316
3.9%
46.4
32.8
50
% change
3%
41%
1.4pp
55%
0.9pp
(41%)
0.8pp
54%
109%
‑
1
Aggregated revenue is defined as statutory revenue and other income plus share of revenue from associates, less procurement revenue at nil margin, pass‑through
revenue at nil margin and interest income. The directors believe the disclosure of revenue attributable to associates provides additional information in relation to
the financial performance of the Group.
2 FY2020 cash flow excludes lease liability payments ($147 million) in accordance with AASB 16 Leases, adopted on 1 July 2019.
3 Before amortization of intangibles, including tax effect of amortization expense.
4 FY2020 and FY2021 prior periods have been restated. Refer to note 2E in the financial statements.
5 All figures are statutory.
Operational priorities
Operational excellence
• Quality of earnings
improvement
• Utilization targets
• Resource management
• Working capital management
Capital management
• Focus on cash realization
• Capital management strategy
supports growth plans
Achievements
• Utilization above target (87%+)
• 73% growth in GID hours; GID
utilization at 12.2%, up from
7.1% at 30 June 2021
• DSO is 63 days, a reduction of
5 days from 30 June 2021
• ~80% of aggregated revenue from
reimbursable contract types
Achievements
• Gearing is at levels supportive of
future growth
• We have good liquidity and access
to flexible, competitively priced debt
capital sources
• Our operating cash result delivered
in the second half is in line with
our earnings
Transformation
• $100m organic investment
in our growth
Achievements
• Leadership appointments complete
across all priority initiatives
• Repeatable automation
solutions progressing
• Strategic collaboration with
IBM and ABB
Cost base
Achievements
• Maintain cost discipline
• Operational leverage
through growth
• Maintained our cost base at the
low levels achieved at FY2021
• We have operational leverage
• Digitally enabled solution helping
energy companies build and operate
green hydrogen facilities more
efficiently and at scale
• Capability building and internal
training programs under development
• Delivered annualized operational
savings of $361m by 30 June 2022
5
Annual Report 2022 “
We hold a leadership position in stewarding towards a
more sustainable world. Our biggest role is in supporting
our existing and emerging customers to reach and
operate at net zero.
“
6
Worley Chair's letter
Our transformation has positioned us as a leader in
sustainability solutions across the markets we serve
John Grill AO
Chair and Non-Executive Director
This year, we’ve consolidated our
position as a leading provider of
sustainability solutions in the
markets we serve and established
a scalable business that facilitates
value growth in the future.
We’ve also delivered a result
consistent with market
improvement and made significant
progress towards achieving our
own ESG commitments, and our
investments to accelerate our
strategy in key growth areas
are already delivering benefits.
This year, we faced into a continued period of volatility across
our industries. The COVID‑19 pandemic, geopolitical tensions
and extreme weather events have had a profound impact on
all of us and our markets. In March of this year, we announced
our planned withdrawal of our services from Russia and will
not enter into new contracts with Russian‑controlled entities.
Consistent with our purpose and values, we're supporting our
people who have been affected, including through the inbound
provision of medical, clothing and other life‑sustaining supplies.
Concerns around energy security, climate change and our
customers supply chain constraints are driving the need for new
infrastructure in the energy, chemicals and resources sectors.
We have a critical role to play in providing the solutions for our
customers as they invest in their traditional businesses whilst
moving towards a low‑carbon future.
Our success is a result of the extraordinary
efforts of our people
We want to express our deep gratitude to our people for their
ongoing commitment, flexibility and courage: for the way they’ve
supported each other, shown respect for our communities and
delivered remarkable solutions for our customers. Our people
are our most important asset, and our highest priority is to
keep them safe and well and feeling included and respected.
Our teams have industry leading safety performance – this
year, our Total Recordable Case Frequency Rate was 0.16 across
the Group1.
By recognizing and investing in our people’s talents, experience
and potential, we foster a diverse and inclusive workplace.
Almost half of the graduates we hired during the year are
women. We actively support the communities we work in.
Examples include:
• our partnerships with First Nations groups in Canada, the US,
Papua New Guinea and Australia
• our “Unlock your genius” educational series for school
students, encouraging the children of today to engage in STEM
• our Worley Foundation, creating shared value and connecting
the diverse skill sets of our people to support communities
• our Life Matters program, raising awareness about mental,
social and physical well‑being. This year, we've grown our
network of mental health champions.
1 TRCFR – Total Recordable Case Frequency Rate, based on the number of cases per 200,000 hours worked.
7
Annual Report 2022 Chair's letter
We’ve delivered improved earnings
In FY2022, our underlying EBITA grew by 18%, compared with
FY2021. We delivered an aggregated revenue of $9,065m (up
3% from FY2021) and at an increased margin of 6%. This was in
line with our expectations. We distributed a dividend of 50 cents
per share to our shareholders.
We delivered ongoing benefits through our cost savings
programs. In aggregate, we’ve achieved our operational cost
savings target six months ahead of schedule, delivering $361m
of annualized savings by the end of June 2022. We're on track to
deliver on our increased target of $375m by June 2023, based
on completing our shared services program. Our cost savings
initiatives involve permanent structural changes. These will
allow us to scale the business and continue to realize operational
leverage as we grow.
We maintained our sound financial capital management position.
Gearing is at levels supportive of future growth. We have good
liquidity and access to flexible, competitively priced debt capital
sources. This financial year, we invested $30m to accelerate our
sustainability competencies.
80% of our top 20 customers by revenue
have net-zero commitments, and
they are turning to us to provide the
expertise, agility and scale to bring
efficiency and commercial viability to
their decarbonization projects.
We've made significant progress towards realizing
our own ESG goals
We evolved our environmental, social and governance practices
to elevate our performance. The following examples highlight
how our commitments are embedded in our culture:
• we now have a 20% weighting for ESG metrics in our senior
leaders’ short‑term incentives business scorecard
• our Scope 1 and Scope 2 emissions reductions remain
on target
• we’re developing and delivering on our inclusive workplace,
including developing training modules on unconscious bias
and respect in the workplace
• we've taken a stand on sexual harassment, completing a pilot
project in Australia. We're poised to take these actions globally.
We’re poised for further growth
This year, we've seen activity levels return as the markets
we serve continued to adapt to the impacts of the COVID‑19
pandemic. Increased customer confidence is driving capital
expenditure, albeit at different rates, across our regions. And
we're starting to see our business scale up in line with increasing
investment across all our sectors. The traditional work we
do continues to be an important part of our future, with our
sustainability related work providing opportunities for a higher
rate of growth.
As we move forward, we recognise that attracting and retaining
talent in the current market is a key challenge, and we’re actively
taking steps to address this. We’re taking a holistic approach,
ensuring we have an appropriate remuneration framework and
that we offer development opportunities, challenging projects
to work on and a values‑based culture.
Direct air capture to fuels project with Oxy Low Carbon Ventures and Squamish Huron Clean Energy Corporation.
8
Worley ALLY Energy GRIT awards
Our People Network Groups, representing
our Black employees and women, were
recognized in the team awards
First Nations of Canada
We’ve reached the ‘Committed’ Level in
our Progressive Aboriginal Relations (PAR)
certification
‘Learning At Worley’
Over 233,000 visits to our internal
learning platform during FY2022
9
Annual Report 2022 Chair's letter
We operate responsibly
We have a strong governance program
The Group recognizes its responsibilities to its shareholders,
customers, employees and suppliers as well as to the
communities in which it operates. The Board ensures the Group
meets all safety, performance and governance standards.
It has ultimate authority over the Group and sees corporate
governance as critical to meeting its objectives. For these
reasons, the Board has adopted appropriate charters, codes
and policies and established various committees to discharge
its duties.
Finally, thank you
Thank you, shareholders, for your continued support. Thank you
to our directors, leadership team and, most importantly, to our
people. We have a business that is diversified across end markets
and geographies and places us as a global industry leader in new
and emerging sustainability markets. We’re delivering on our
commitments in line with our expectations and continue to see
momentum building in line with our strategic transformation.
I look forward to working with you to create an exciting future
for our Company.
John Grill AO
Chair and Non-Executive Director
We’re always strengthening the governance and operational
controls we have in place to reinforce a culture of acting lawfully,
ethically and responsibly.
• our Responsible Business Assessment process ensures that
all customers and projects meet our criteria for responsible
business practice
• later this year, we'll issue our second Group Modern Slavery
Statement which shows our commitment to combatting
human rights abuses
• our Data Protection Office governs compliance of our cyber
security program with global data protection requirements, as
specified in Australia, Europe, the US and other jurisdictions in
which we work.
Maintaining and enhancing our reputation for integrity, honesty
and ethical practices is important to the Board and underpins our
future success. We comply with all applicable laws and conduct
our business to the highest standard. We engage with partners
and agents that apply the same high standard. We take action
when we become aware of non‑compliance to these practices.
We made changes to the Board and Management
In November 2021, Thomas Gorman stepped down as Chair of
the People and Remuneration Committee. He remains a member
of the People and Remuneration Committee, the Health, Safety
and Sustainability Committee and the Nominations Committee.
Emma Stein has assumed responsibilities as Chair of the People
and Remuneration Committee. Emma is now also a member of
the Health, Safety and Sustainability Committee.
In February 2022, Andrew Liveris retired as a member
of the Health, Safety and Sustainability Committee.
He remains Deputy Chair of the Board, a member of the
People and Remuneration Committee and a member of the
Nominations Committee.
On 29 November 2021, we welcomed Tiernan O’Rourke as Chief
Financial Officer of the Group. Tiernan brings with him 30 years’
experience in financial, commercial and planning roles across a
range of industries, sectors and regions.
We thank Charmaine Hopkins for her time as Interim Chief
Financial Officer of the Group. Charmaine has now been
appointed to the role of Deputy Chief Financial Officer of
the Group.
10
Worley Board of Directors
John Grill AO
Chair and Non-Executive Director
John is Chair of the Board
and Chair of the Nominations
Committee. He is a member of the
Health, Safety and Sustainability
Committee and the People
and Remuneration Committee.
Thomas Gorman
Non-Executive Director
Thomas is a member of the
People and Remuneration
Committee, the Health, Safety
and Sustainability Committee
and the Nominations Committee.
Roger Higgins
Non-Executive Director
Roger is Chair of the Health, Safety
and Sustainability Committee and
a member of the Nominations
Committee.
Sharon Warburton
Non-Executive Director
Sharon is a member of the
Audit and Risk Committee and
the Nominations Committee.
Juan Suárez Coppel
Non-Executive Director
Juan is a member of the Audit
and Risk Committee and the
Nominations Committee.
Martin Parkinson AC
Non-Executive Director
Martin is a member of the
Audit and Risk Committee and
the Nominations Committee.
Nuala O’Leary
Group Company Secretary
Andrew Liveris AO
Deputy Chair, Lead Independent
Director and Non-Executive Director
Andrew is Deputy Chair and Lead
Independent Director of the Board
and a member of the People and
Remuneration Committee and
the Nominations Committee.
Anne Templeman-Jones
Non-Executive Director
Anne is Chair of the Audit and
Risk Committee and a member
of the Nominations Committee.
Wang Xiao Bin
Non-Executive Director
Xiao Bin is a member of the
Audit and Risk Committee and
the Nominations Committee.
Christopher Haynes OBE
Non-Executive Director
Christopher is a member of the Health,
Safety and Sustainability Committee,
People and Remuneration Committee
and Nominations Committee.
Emma Stein
Non-Executive Director
Emma is Chair of the People and
Remuneration Committee and the
Health, Safety and Sustainability
Committee and a member of
the Nominations Committee
and the Health, Safety and
Sustainability Committee.
Chris Ashton
Chief Executive Officer
and Managing Director
For detailed information on Directors and the Group Company Secretary, see pages 121 to 125.
11
Annual Report 2022 “
Our strategy is well progressed as the
world's imperative to meet net zero
“
continues to build momentum.
12
Worley CEO's letter
This is the decade of action, and we’re leading
the way in delivering smarter, bolder solutions for
our customers as well as delivering on our own
sustainability commitments
Chris Ashton
Chief Executive Officer and Managing Director
The world is moving towards net
zero and addressing global energy
security and sustainability challenges.
The complexity, scale and rate of
change we're facing into will be unlike
anything we’ve seen in our lifetimes.
Solving these multi‑generational challenges is what inspires us.
This year, we’ve been at the forefront of delivering first‑of‑a‑kind
commercial‑scale solutions in engineering, logistics, technology
and project delivery as we support our customers on their
own journey.
Our people are our most important asset
We have more than 51,000 of the brightest minds in our
industry. We’re united and motivated by our purpose, and by our
role in tackling our existing and emerging customers’ complex
challenges. The ways we’ve transformed our business have
uniquely positioned us for success – both now and in the future.
And with knowledge, data and technology, we’re giving our
customers solutions to challenges they’ve never faced before.
None of our past or future achievements would be possible
without our exceptional people, who inspire me every day. It’s
the collaborative creativity and agility they show that sets us
apart and exemplifies the spirit of Worley.
We believe in the safety, health and well‑being
of our people, communities and environment.
Without this, nothing else matters.
I’m deeply saddened by the events in Ukraine – at times like
these, our values of Life and being Stronger Together are so
important. We prioritized taking care of our people who were
affected, including those in Ukraine and Russia, as we lived our
values. We’ve started safely withdrawing our services from
Russia. We’re still supporting all our people and the communities
we work in, and showing the respect and courage that reflects
our Worley culture.
The current global context provides a
background of challenge and opportunity
for our business
We continue to witness emerging events that impact the
industries and communities we serve. We’ve seen the impacts
of the Russia/Ukraine conflict on energy markets as regions
grapple to secure energy independence. We expect to see an
acceleration in the development of diverse energy supplies,
including energy from low‑carbon sources, and an increase in
near‑to‑medium term gas investment to reduce reliance on
Russian supply.
There’s no doubt that we’re seeing workforce movement
across society and businesses. Delivering in this environment is
underpinned by our people. We’re committed to an inclusive and
respectful culture and developing our people as we transform
and build the critical skills and capabilities to strengthen our
business resilience and accelerate growth.
13
Annual Report 2022 CEO's letter
I’m proud of the results we’ve
delivered this year
We’re uniquely positioned across
high-growth markets
We’ve executed our strategy and delivered results in line with our
expectations. We’re benefiting from our early‑mover positions in
growing sustainability areas.
These results are indicative of continued market expansion
in both our traditional and sustainability related work.
We have delivered an improved result against a backdrop of
geopolitical and economic challenges. This is a direct result of
the changes we’ve made to our business. We’ve set up a scalable
business, and we’re delivering ongoing benefits from our
cost‑saving programs.
We improved the quality of our earnings. Key factors contributing
to this result are a continuing improvement in rate, particularly in
sustainability‑related professional services, and the retention of
benefits from our costs savings program which is increasing our
operating leverage. Our traditional revenue has remained steady
and our revenue from sustainability related work has grown by
13%. Sustainability related work now accounts for over 35% of
our total revenue1.
We've seen momentum growing in the second half. Aggregated
revenue and underlying EBITA are up 8% and 18% respectively in
H2 FY2022, compared with H1 FY2022.
The strategic progress on our transformation is well advanced.
We have continued to see growth in our backlog and factored
sales pipeline across both our traditional and sustainability
related work. With sustainability related work now greater than
50% of our factored sales pipeline, we expect the contribution
from sustainability related work to continue to grow which
should translate to higher quality of earnings.
As a global leader in the sectors we serve, we have an important
role to play in high‑growth markets.
Our customers are straddling two worlds. They’re investing
in their traditional businesses as well as in the sustainability
projects. We're helping our customers to electrify, improve
efficiency, abate emissions and decarbonize power generation
and supply chains.
A wave of sustainability spend is coming, and
we are in a leadership position
In order for the world to meet net zero by 2050, it's anticipated that
a fourfold increase in global energy investment will be required
over the next 30 years2, compared to the past 30. The types of
projects required to achieve a more circular economy, net‑zero
emissions and better results for our societies are complex, require
deep knowledge and need the ability to scale‑up globally.
$131 trillion
Total capex investment requirement for net zero by 20502
We have strong capability in areas like hydrogen, battery
materials, low‑carbon fuels and carbon capture, use and storage.
And we deliver projects at scale and in new and innovative ways,
including through digital solutions.
Revenue1
Backlog3
Factored sales pipeline4
$15.4b
up 30%
$14.3b
3.5
4.3
23%
$8.8b
2.8
$9.1b
3.2
13%
5.9
5.9
Flat
10.8
11.1
3%
56%
57%
47%
53%
44%
6%
FY2021
FY2022
at Jun-21
at Jun-22
at Jul-21
at Jul-22
Traditional
Sustainability
1 See page 27 for how we define traditional and sustainability related work.
2 The State of the Global Energy Transition in 2021, Aurora Energy Research, September 2021.
3 Backlog definition provided on page 213. Backlog is not in constant currency, based on exchange rates as at 30‑June.
4 Factored for likelihood of project proceeding and being awarded to Worley.
14
Worley We're accelerating our growth in targeted areas
We're making a strategic investment of $100m in organic growth
over three years to accelerate our sustainability solutions, digital
enablement and process technology. We’re now one year in, and
we’ve made good progress in building our capabilities. We’ve
done this through strategic hires, attaching established senior
leaders to each of our initiatives and recruiting subject‑matter
experts. We are already seeing the early benefits. Demand
projections and our traction to date suggest many of these
markets will become material businesses for us. For example,
in FY2022 compared with FY2021, the following increases
were achieved:
• Copper: 185% increase in sales pipeline
• Low‑carbon hydrogen: 70% increase in number of project wins
• Low‑carbon fuels: 75% increase in sales pipeline.
We’ve built numerous strategic partnerships that
differentiate us in key markets
• We’re collaborating with IBM and ABB on a digital system
to help energy companies build and operate low‑carbon
hydrogen facilities more efficiently and at scale.
• We’ve reached the construction phase of our partnership
with Avantium for a world‑first commercial‑scale bioplastics
facility. We have an equity investment in this project and a
technology partnership agreement for future developments.
We're leveraging our strengths
In FY2022, we announced our ambition to be recognized
globally as a leader in sustainability solutions within five years.
There are three pillars to this ambition: our People, our Portfolio
and our Planet. Each pillar has measurable objectives, which we
use to inform and guide our decisions.
We're investing in our People
We’re facing a very buoyant talent market. It's one of the most
challenging talent markets we've faced into for some time. We’ve
sharpened our people strategy to focus on two very clear areas.
The first area is strengthening the Worley experience. Our Worley
culture is what we’re most proud of and sets us apart. We're
continuing to evolve our culture in an inclusive way such as our
Diversity and Inclusion (D&I) leadership development program.
The second area of focus is building the right environment to
both attract and retain critical capabilities at scale. Our digital
learning platforms are enabling re‑skilling of our people and
mobilizing talent in new and agile ways.
Breaking ground at the Avantium bioplastics facility in the Netherlands.
People-based initiatives
Development and re-skilling
• Over 33,000 digital and sustainability‑related
learning accreditations issued in FY2022
• Competitive flexible working practices
Values and behaviors
• Piloting Appreciate, our peer‑to‑peer values
recognition program, in five countries
Safety and well-being
• 300 passionate mental health champions
across 30+ countries
• 11,000+ virtual participants in safety week
Remuneration
• Competitive framework with regular benchmarking
• Attractive terms and conditions
Attraction and retention
• New tools to acquire and develop the right skills
• Development opportunities and challenging work
15
Annual Report 2022 CEO's letter
Our Portfolio shows the kind of business we
aspire to be
We aspire to be our customers' most trusted partner, providing
best‑in‑class solutions.
This year, I created two new business functions on my executive
team: Information and Digital Delivery (I&DD) and Technology
Solutions. This will help us fast track the development of our
capabilities in these areas – and deliver increasingly more
innovative solutions across our strategic priorities.
Our customers say our digital capabilities are a key differentiator
when combined with our project‑management experience, domain
expertise and global scale. For example, we’ve partnered with
1PointFive on the first commercial‑scale Direct Air Capture (DAC)
development for removing CO2 from the atmosphere. Through
this partnership, we’re exploring next‑generation technology,
materials and manufacturing approaches, based on a circular
economy. This will help with the DAC facility’s sustainability
and capital efficiency.
“If we develop energy
infrastructure the way we
always have, we won’t get to
net zero by 2050. We might not
even get halfway.”
From Ambition to Reality |
Worley and Princeton publication
Our Planet reflects our own commitments and
how we support those of our customers
We're making good progress towards achieving our own
commitments.
We updated our Climate Change Position Statement,
and it now better reflects our role in:
• decarbonizing the energy, chemicals and resources sectors
• supporting asset resilience
• protecting biodiversity
• supporting an inclusive transition.
We’re also keeping up our commitment to the initiatives and
principles of the UN Global Compact and achieving the UN SDGs.
We’ve reduced our Scope 1 and Scope 2 emissions by 29% from
FY2021 to FY2022
We’ve done this mainly by switching offices and fabrication
yards to renewable energy and by converting some of our
fleet to hybrid vehicles and biofuels. Our success with remote
16
working means that we expect that our level of travel will remain
well below pre‑COVID‑19 pandemic levels. We’ll seek to keep
reducing our carbon footprint with fundamental changes to the
ways we use energy.
We're at the forefront of thinking around sustainability
We brought industry leaders and government representatives
together at a round‑table discussion at the 26th UN Conference
of the Parties (COP26). This event reminded us that collaboration
is vital for the pathway to net zero.
I met with leaders at the World Economic Forum in Davos,
Switzerland. The mood was one of hope and of collaboration
towards an inclusive transition and momentum on climate
change commitments.
We’re using our real‑world project expertise to help our industry
overcome the challenges that come with a mid‑century
net‑zero target – and to understand the mix of technologies
and the scale of infrastructure we’ll need. We'll be releasing part
two of our ‘From Ambition to Reality’ series with the Princeton
Andlinger Center for Energy and the Environment. In part two,
we develop indicators to measure the shifts needed to deliver
net zero at the required pace and scale.
We’re a cornerstone supporter of the Net Zero Australia project.
This project delivered interim findings this year on possible
roadmaps to net zero.
Momentum is building, and we’re making good
progress towards achieving our ambition
This year, we've delivered growth in revenue and earnings, and
we have a scalable business that is benefiting from operating
leverage. We've delivered this despite the challenges stemming
from the geopolitical instability in Europe and the COVID‑19
pandemic. Our transformation has positioned us as a leader in
high‑growth markets. We have trusted relationships with our
existing and emerging customers, and we celebrate and respect
the diverse thinking of our people and our unique culture. Our
commitment to sustainability and social well‑being is what,
I hope, makes our people come to work every day feeling
empowered to make a difference. I want to acknowledge our
remarkable people and thank each and every one of them for
their dedication.
To our shareholders, I want to say thank you for your support
and for the confidence you have in your Company. We have an
exciting future, aligned with our purpose; delivering a more
sustainable world.
Chris Ashton
Chief Executive Officer
Worley
Group Executive
The Group Executive is our senior leadership team. It comprises
the leaders of our regions and functions. The Group Executive advises
the Chief Executive Officer with regard to the planning, development
and efficient functioning of our global business1.
Chris Ashton
Chief Executive Officer
Tiernan O'Rourke
Chief Financial Officer
Karen Sobel
Group President
Americas
Mark Brantley
Group President
EMEA and APAC
Mark Trueman
Executive Group Director
Growth
Sue Brown
Executive Group Director
Sustainability
Geeta Thakorlal
Executive Group Director
Information and Digital Delivery
Andrew Berryman
Executive Group Director
Technology Solutions
Vikki Pink
Chief People Officer
Nuala O’Leary
Group Company Secretary
Larry Kalban
Group General Counsel
Legal
Francis McNiff
Executive Group Director
Transformation
1 As at end of FY2022.
17
Annual Report 2022 Context and strategy
The world we operate in
The context and strategy section describes the external environment
that is changing our business and the sectors that we serve and how
we're responding to this.
Our world is changing, and we're taking action
2. We must protect nature
Over the past year, we’ve seen continuing and new events
shape our environment, society and economy. These events
are changing the markets we serve.
They're driving sustainability investment across sectors – giving
us more opportunities to grow our sustainability related work.
We’re in a strong position to solve our customers’ challenges in
adapting to a more sustainable low‑carbon future.
Below, we outline five macro trends of specific importance to
our business.
Preserving and restoring the natural world is a key global
issue. The world is expected to agree on a Global Biodiversity
Framework as part of the Convention on Biological Diversity
later this calendar year.
The connection between climate and nature provides us a
significant opportunity: we can progress climate action while
also working towards solutions to other environmental issues.
We're now developing a plan to support biodiversity and nature
positivity in our project work (see page 75).
3. Digitization is unlocking new opportunities
To deliver low‑carbon infrastructure at an unprecedented scale,
we’ll need new ways of working.
Data and digital technologies are key accelerators for the energy
transition and sustainability. The energy sector, in particular, is
focused on making the most of existing assets and using new
technologies, at scale, to ramp up decarbonization.
Our customers value the solutions we deliver through our digital
capability (see page 68).
1. This is the decade of climate action
We’re supporting our customers on their journey to low‑carbon
business models. The recent Intergovernmental Panel on Climate
Change (IPCC) reports say that the next eight years are critical
for the future of our climate. We saw increased commitments
at COP26, in November 2021, including the Glasgow Financial
Alliance for Net Zero (GFANZ) – further growing the investment
opportunity.
With our customers increasing their investments in this space,
we're focused on a new paradigm to address the delivery
challenge (see page 96).
In delivering net‑zero emissions, we're supportive of an
inclusive transition. And we must base our work on sustainable
development principles. We play an important role in the
delivery of low‑carbon infrastructure. Our strategy is to bring
our stakeholders on the journey and to make sure all of society
benefits from our work (see page 25).
Image (left) taken by Bobby Weatherford, Construction Manager, as part of our Earth Day photo competition.
Image (middle) taken by Yinghao Ling, Vice President - Operations (China), as part of our Earth Day photo competition.
18
Worley 4. The tightening talent market
5. An increasingly unstable world
Over the past year, we've experienced significant change in
the talent market and the ways society and business have
responded. Worldwide we've seen workforce movement across
industries and sectors, increased labor shortages and demand,
along with expected wage growth.
Our people are central to achieving net zero and other
sustainability challenges, and they are at the heart of our
transformation. Optimizing the hire‑to‑retire journey for
our people is a priority of ours. This is needed for us to achieve
our ambition.
We're making sure our people are safe, healthy, respected
and productive in their jobs. And we’re investing in our people
through development so they can develop the necessary skills to
take on roles in sustainable projects (see page 91).
The world is changing at an ever‑increasing pace. Emerging
events continue to have an impact on our environment, society,
and economy. These events provide a background of challenge
and opportunity for our business. At the World Economic Forum
in Davos, Switzerland, there was discussion around the mounting
challenges from supply chain disruptions, shifts in labour
markets, the impacts of inflation as well as the different speeds
of adoption of the energy transition.
Russia’s invasion of Ukraine is elevating the need for energy
independence and security. Before the conflict began,
approximately 40% of gas, 30% of oil and 50% of coal were being
supplied by Russia to the European Union1. The European Union
is actively seeking to reduce its dependency on Russian gas. This
opens up opportunities for gas importation to Europe, along with
other energy sources.
We expect to see an acceleration in the development of
diverse energy supplies, including low‑carbon energy, in the
near‑to‑medium term to reduce reliance on Russian supply.
We are well positioned to support our customers in all of
these areas.
1 Reference: European Commission, REPowerEU: Joint European action for more affordable, secure and sustainable energy, 2022
19
Annual Report 2022 Context and strategy
Our purpose, ambition and values
The industries we operate in are evolving in line with macro trends.
And our customers are evolving their businesses to match their
sustainability commitments. This gives us a leading role in supporting
our customers with the solutions they need.
Our purpose ‑ delivering a more sustainable world ‑ is central to our transformation.
We’re now ready for the next chapter. This year, we announced our ambition to become the global leader
in sustainability solutions. Our values underpin both our purpose and ambition.
Purpose
Delivering a more
sustainable world
Ambition
We will be recognized
as the global leader in
sustainability solutions
Values
We value Life
We believe in the
safety, health
and well‑being
of our people,
communities and
the environment.
Without it, nothing
else matters.
We Rise to the
challenge
We are Stronger
together
We Unlock
brilliance
We love a challenge.
We go the extra
mile, delivering
new and better
solutions to
complex problems.
We thrive in real
relationships and
partnerships. We
nurture networks
and collaboration.
We recognize our
differences make
us stronger.
We are passionate
about innovating
and learning.
We value,
share and grow
our expertize.
20
Worley Our ambition is based on three measurable pillars: our People, our Portfolio and our Planet.
Our People
We energize and
empower our people to
drive sustainable impact
• We foster a safe, inclusive and
innovative work environment
that inspires our people
• We provide outstanding
opportunities to learn, develop
and drive sustainability
• We attract and retain top talent
with diverse backgrounds
Our Portfolio
We are our customers' most
trusted partner, providing
best-in-class solutions
• We accelerate our growth and aspire
to derive 75% of our revenue from
sustainability‑related business
• We implement new solution‑based
models, enabled by data, technology
and automation
• We expand the value we bring to our
customers, share in that value and
ensure a higher return on investment
Our Planet
We partner with customers
as stewards of a more
sustainable world
• We commit to our own sustainability
– reaching net‑zero Scope 1 and
Scope 2 emissions by 20301 and
Scope 3 by 2050
• We partner with customers
committed to driving sustainability
– together we decarbonize value
chains and steward resources
• We seek to be recognized globally
for our leadership in sustainability
We’re investing in line with these pillars as we build on our transformation. Every step we take is aligned with our purpose
and underpinned by our values. And our ambition guides our strategy.
1 We have an interim target of 50% reduction in FY2020 total Scope 1 and Scope 2 emissions by 2025.
21
Annual Report 2022 Context and strategy
How we create value
This year, we’ve included a value
map to show how we create
value for our stakeholders.
This is communicated through
our business value drivers.
Our value map shows the range
of resources and relationships
we rely on to create value
today and tomorrow.
The use of business value drivers is part of our shift
towards alignment with the International Integrated
Reporting Framework. They represent the forms of
capital that we commonly depend upon to create value.
22
Inputs
Finance
(Financial capital)
Active capital management from diverse
and competitive sources, driving business
growth and value for our investors.
Knowledge, technology and data
(Intellectual capital)
What we know – our brand, execution
methodologies, intellectual property, data,
technology, knowledge and insights –
together driving efficiency and productivity.
Equipment and fabrication
(Manufactured capital)
Manufactured equipment and modules for
the Energy, Chemicals and Resources sectors,
supporting delivery of critical infrastructure.
Environment
(Natural capital)
How we consider the environment
with all stakeholders, stewarding
environmental sustainability.
People
(Human capital)
How we support and include our global team
to safeguard and enhance their well-being,
helping them to drive sustainable impact.
Communities
(Social and relationship capital)
Strong relationships within our sectors –
with our people, customers, investors,
communities and governments – building
trust and license to operate.
Purpose
Outcomes
Delivering a more sustainable world
We provide our customers with solutions
to meet their business needs, including
their sustainability commitments
Our People
Our Planet
Ambition
Our Portfolio
We support our current and emerging customers
as they invest in their traditional businesses and
move towards a low-carbon future
Our sustainability solutions drive economic,
environmental and social impact across our sectors
Read more on page 27 for how we define our sustainability and traditional work.
y
b ilit
Asset sustain a
Resource s
t
e
w
a
r
d
s
h
i
p
Low-carbon
Conventional
Energy
Energy
Resources
Chemicals
and Fuels
D
e
c
a
r
b
o
niz
atio
n
m e nt and society
n
v ir o
n
E
Values
We value
Life
We Rise to
the challenge
We are
Stronger
together
We Unlock
brilliance
Finance
Value creation and return
to our investors
Read more on page 58.
Knowledge, technology and data
Well-executed, integrated and
differentiated solutions for
our customers
Read more on page 63.
Equipment and fabrication
Delivery of Energy, Chemicals and
Resources infrastructure
Read more on page 71.
We're also delivering on our own
sustainability commitments and
strengthening our ESG performance
Environment
Stewardship of natural systems
Read more on page 74.
People
Empowered and energized
to drive sustainable impact
Read more on page 88.
Communities
Stakeholder trust and
social license to operate
Read more on page 95.
Worley This year, we’ve included a value
map to show how we create
value for our stakeholders.
This is communicated through
our business value drivers.
Our value map shows the range
of resources and relationships
we rely on to create value
today and tomorrow.
The use of business value drivers is part of our shift
towards alignment with the International Integrated
Reporting Framework. They represent the forms of
capital that we commonly depend upon to create value.
Inputs
Finance
(Financial capital)
Active capital management from diverse
and competitive sources, driving business
growth and value for our investors.
Knowledge, technology and data
(Intellectual capital)
What we know – our brand, execution
methodologies, intellectual property, data,
technology, knowledge and insights –
together driving efficiency and productivity.
Equipment and fabrication
(Manufactured capital)
Manufactured equipment and modules for
the Energy, Chemicals and Resources sectors,
supporting delivery of critical infrastructure.
Environment
(Natural capital)
How we consider the environment
with all stakeholders, stewarding
environmental sustainability.
People
(Human capital)
How we support and include our global team
to safeguard and enhance their well-being,
helping them to drive sustainable impact.
Communities
(Social and relationship capital)
Strong relationships within our sectors –
with our people, customers, investors,
communities and governments – building
trust and license to operate.
Purpose
Delivering a more sustainable world
Our People
Ambition
Our Portfolio
Our Planet
We support our current and emerging customers
as they invest in their traditional businesses and
move towards a low-carbon future
Our sustainability solutions drive economic,
environmental and social impact across our sectors
Read more on page 27 for how we define our sustainability and traditional work.
Resource s
t
e
w
a
r
d
s
h
i
p
m e nt and society
y
b ilit
Asset sustain a
Low-carbon
Energy
Conventional
Energy
D
e
c
a
r
b
o
Resources
Chemicals
and Fuels
niz
atio
n
n
v ir o
n
E
Values
We value
Life
We Rise to
the challenge
We are
Stronger
together
We Unlock
brilliance
Outcomes
We provide our customers with solutions
to meet their business needs, including
their sustainability commitments
Finance
Value creation and return
to our investors
Read more on page 58.
Knowledge, technology and data
Well-executed, integrated and
differentiated solutions for
our customers
Read more on page 63.
Equipment and fabrication
Delivery of Energy, Chemicals and
Resources infrastructure
Read more on page 71.
We're also delivering on our own
sustainability commitments and
strengthening our ESG performance
Environment
Stewardship of natural systems
Read more on page 74.
People
Empowered and energized
to drive sustainable impact
Read more on page 88.
Communities
Stakeholder trust and
social license to operate
Read more on page 95.
23
Annual Report 2022 Context and strategy
Our current business
We’re maintaining and growing our business profitability while pivoting
and investing to address the demand for sustainability solutions.
We are Australia’s largest exporter of knowledge‑based services.
We use this position to support our customers with solutions
to the challenges they face. Business activities associated with
professional services constitute more than 60% of revenue and
more than 85% of earnings1. This includes Advisian, our advisory
and front‑end consulting business.
Our global operations are now diversified across several end
markets. Approximately 30% of revenue comes from each of
the following markets: sustainability; traditional energy; and
traditional chemicals. The balance is in traditional resources.
We hold leading positions in the sectors we serve, and
we have balanced exposure to our customers’ capital and
operating spend. We operate under low‑risk commercial models.
~80% of our work is reimbursable as at 30 June 2022. We don't
have a material amount of competitively tendered lump sum turn
key projects, and it is not in our strategy to increase exposure to
such projects in the future.
Revenue from sustainability related work is 35% of total revenue.
As one of the few global‑scale services companies with capabilities
in both traditional and sustainable technologies, we're already
well positioned to benefit from increasing customer investment
because of the current energy, chemicals and resources supply
gaps across both traditional and sustainability related work.
And we have a balance sheet that supports the strategic
investments needed to accelerate our growth.
Traditional/sustainability
Sustainability/traditional
Sustainability/traditional
aggregated revenue (%)
aggregated revenue (%)
aggregated revenue (%)
Regional aggregated
Regional
revenue (%)
aggregated revenue (%)
Type of services (%)
Customer spend aggregated revenue (%)
Contract type aggregated
revenue (%)
Contract type aggregated revenue (%)
23%
12%
7%
12%
5%
31%
1%
19%
64%
80%
Europe
Middle East & Africa
Asia
Australia & New Zealand
Americas
Procurement2
Construction & Fabrication
Professional services
Lump Sum Turn Key (LSTK)
Reimbursable
Fixed price (excluding LSTK)
35%
31%
46%
5%
29%
Traditional energy
Traditional chemicals
Traditional resources
Total sustainability
Team members from our JESA joint venture.
1 Earnings refer to underlying EBITA.
2 Nil‑margin procurement is excluded.
24
Worley Our strategy
As a leading service provider to the energy, chemicals and
resources sectors, we have a key role in shaping and supporting
the future of our addressable markets in the energy transition.
We’re building on a strong foundation and our ambition will be
realized across the sectors we serve.
We recognize that this is the largest economic and
societal transformation in history. We're accelerating
sustainability‑focused growth in traditional hard‑to‑abate
sectors as well as in emerging markets.
The energy transition is a journey, and we are bridging two
worlds. While we are moving towards more sustainable
energy sources, we are also helping our customers in their
traditional businesses to become cleaner, more efficient
and digitally enabled.
Hard‑to‑abate sectors represent 81% of the global economy’s
carbon footprint1, and we cannot deliver on our ambition without
helping existing markets reduce emissions.
Our approach to growing new business opportunities is designed
to bring focus and adaptability and to harness the strengths of
our current business while building critical new capabilities.
Our strategy is to be a one-stop solutions provider
for the energy, chemicals and resources sectors
Given the breadth and depth of our sectors, delivering our
strategy will require us to take different approaches across
our addressable markets. Our strategy recognizes that we
play across three integrated markets: core, transitional and
breakthrough.
We see our core markets evolving as we help our customers
with the energy transition. We conduct both traditional and
sustainability related work in our core markets. At the same
time, we’re building and extending high‑growth businesses in
our transitional markets. And we’re creating valuable options in
our breakthrough markets, where we’re targeting rapid growth.
We’ll continue to grow our business across each of these markets.
Our markets span multiple sub-sectors across Energy, Chemicals and Resources
Core
markets
(Strengthen
and support)
Transitional
markets
(Extend high-growth
businesses)
Breakthrough
markets
(Create valuable
options)
Upstream
Combustion
energy
Nuclear
power
Midstream
energy
infrastructure
Ports and
terminals
infrastructure
Integrated
gas
Low‑carbon
hydrogen
Carbon capture,
use and storage
(CCUS)
Offshore
wind
Chemicals
Refined
fuels
Specialty
chemicals
Copper
Low‑carbon
fuels
Plastics
recovery
Networks and
energy storage
Water
Fertilizers
Bulk
commodities
Base
metals
Sulfur
recovery
and re‑use
Resource
infrastructure
1 Source: McKinsey & Company
25
Annual Report 2022 Context and strategy
How we help our customers
The energy transition is changing our existing and
emerging customers’ notion of value
Our customers are tackling critical business challenges as they
navigate the energy transition – responding to technological,
market, regulatory and societal change. Not only must our
customers maximize the value of their assets, they must also
do so with efficiency and in ways that achieve their net‑zero
ambitions while navigating complex stakeholder expectations.
...ensure my assets
contribute to my
sustainability and
net zero ambitions?
...manage my
natural resources to
minimize waste?
How can I...?
...ensure my
company meets
societal, regulatory
and investor
expectations?
...commercialize
and maximize the
value of my assets?
Our customers trust us
We use our expertise and experience to address complex
sustainability challenges. With our depth of industry knowledge
and market leadership, we can deliver the best technical and
advisory solutions across the entire value chain. As our customers’
trusted partner, we deliver more than just projects – we deliver
impactful solutions for their greatest business challenges.
We are a one-stop sustainability solutions provider
Our sustainability solutions cut across all our sectors (energy,
chemicals and resources) and all our strategic markets (core,
transitional and breakthrough).
Our four sustainability solutions are:
• Decarbonization: Reducing carbon dependence in our
industrial systems. The goal is to address climate change,
while keeping businesses sustainable and improving
everyone’s quality of life.
• Resource stewardship: Systems designed to replace the
linear, end‑of‑life concept of waste and pollution. Resource
stewardship is about sustainably keeping products and
materials in use and regenerating natural systems.
• Asset sustainability: Lowering the asset risks that come
from the impact of climate change. The goal is to improve
(or extend the lifespan of) infrastructure, promote re‑use of
existing assets rather than building new ones, and encourage
sustainable design in upgrades and new builds.
• Environment and society: Finding practical ways to develop
new infrastructure, while safeguarding the environment and
benefiting society and the economy.
Our solutions are underpinned by our distinctive
capabilities in Digital and Analytics, Technology
and Advisory
Within Digital and Analytics, we're investing in developing
autonomous sites, digital asset models and repeatable service
designs. We're finding ways to accelerate the development of
capital projects and programs as well as developing essential
process technologies that support our sustainability solutions.
Through our advisory services, we're creating and monetizing
value from knowledge gained across our global teams while
building data‑backed insights across the full asset lifecycle.
26
Worley How we define our sustainability related work
We define our sustainability related work through four pathways: Decarbonization, Resource stewardship, Environment & Society,
and Asset sustainability. These are calculated based on two measures:
1. The work we conduct in relation to the following markets:
Decarbonization
Resource stewardship
• Energy transition
• Nuclear energy
• Bio‑based materials
• Plastics recovery
materials
• Low‑carbon fuels
• Metals recovery
• Sulfur recovery
• Renewable energy
(including integrated gas1)
2. The work we conduct in relation to our sustainability solutions, which can be applied across all markets:
• Carbon management
• Decarbonization infrastructure
• Energy efficiency
Decarbonization
• Electrification
Resource
stewardship
• Environmental management
• Social performance
• Policy & regulatory
• Remediation & liability
management
Environment
& Society
Asset
sustainability
• Performance optimization
• Decommissioning & restoration
We refer to all business falling outside of sustainability related work as traditional work.
Our sustainability related work today makes up a significant proportion of our revenue,
backlog and pipeline
Aggregated revenue
Backlog
Factored sales pipeline
35%
28%
65%
Sustainability
Traditional
72%
Sustainability
Traditional
44%
56%
Sustainability
Traditional
1 We consider integrated gas as a necessary path on the way to achieving net‑zero emissions.
27
• Recycling
• Process efficiency
• Waste management
• Water stewardship
• Sustainable design
• Development and
commercialization
Annual Report 2022 Context and strategy
We're investing in strategic initiatives
to support our growth and ambition
To bring even more focus on how we’ll achieve our ambition,
we’ve identified priority initiatives across the strategic
portfolio for targeted investment. We've had conversations
with our customers to help us understand their priorities and
investments. We then overlaid this information with what we see
as the market opportunity and where we have a good platform
for growth.
We're making a strategic investment of $100m in organic growth
over three years to accelerate our sustainability solutions, digital
enablement and process technology. We’ll harness the strengths
of our current business and build strategic partnerships, focusing
on accelerating growth in sustainability related work. Our
strategic investment will target breakthrough and transitional
sustainability markets and capabilities, which have been
identified as areas where we hold a competitive advantage.
Investments in breakthrough markets
Investments in capabilities
Industrial hubs – leverage Worley’s global synergies
to develop scalable, integrated solutions around the
key challenges anticipated in delivering the shared
decarbonization goal within industrial hubs.
Adapting existing assets – provide a full‑service offering
to evaluate and adapt, repurpose or decommission
the existing assets base to address the challenge
of sustainability.
Sustainability and decarbonization advisory – provide
transformative sustainability consulting services,
drawing on wider Worley capabilities to advise and
support customers in meeting net zero and ESG
commitments.
Low-carbon hydrogen – establish Worley as the
leading partner in low‑carbon hydrogen by developing
repeatable, scalable and digitally enabled advisory and
project services solutions.
Carbon capture, use and storage – position Worley
as the leader in providing solutions for our customers’
CO2‑emitting assets that sustainably and economically
capture, utilize and store emissions.
Networks and energy storage – become the key
integrator providing power networks and energy storage
solutions for energy system optimization,
long‑duration energy storage, demand‑response
technology and transmission and distribution networks
across the asset lifecycle.
Water – become an integrated water solutions provider,
with solutions across multiple parts of the water
envelope and project lifecycle.
Battery materials – build on Worley's leading market
share in Battery Active Materials by expanding the
customer base, increasing delivery capacity and
developing repeatable, scalable and digitally enabled
capital deployment and asset management solutions.
We're targeting the right areas and making progress towards our ambition, evident through
increases in factored sales pipeline in these areas1
80%
Low-carbon hydrogen
95%
Battery materials
80%
CCUS
185%
Copper
115%
Water
75%
Low-carbon fuels
1
Increase in factored sales pipeline from July 2021 to July 2022 for selected growth areas, factored for likelihood of project proceeding and being awarded to Worley. Ability
to record pipeline in growth areas was not introduced until September 2021 and was retrospectively applied.
28
Worley 29
Annual Report 2022 Context and strategy
Market outlook and case studies
Energy
We report on the energy sector with respect to both conventional energy and low‑carbon energy.
We support our existing and emerging customers to achieve their energy transition goals. Refer to
page 50 for the explanation of how we define our sectors.
Conventional energy
During FY2022, we saw growth in global oil markets. As the economic impacts from the
restrictions due to the COVID‑19 pandemic began to ease, markets rebalanced and global
stockpiles which had peaked in 2020, declined back to within their five‑year average range.
Russia's invasion of Ukraine subsequently disrupted energy markets. It caused a spike in
commodity prices and kickstarted a process to reduce Europe's dependency on Russian oil
and gas. Where the COVID‑19 pandemic lowered demand, the crisis in Ukraine has seriously
affected supply. A renewed push for energy security by Western nations is leading to increased
oil and gas investment.
The push for energy security needs
to co-exist with the energy transition
Delivering a more sustainable world
in conventional energy
In the short term, other producers can make up
for the loss of Russian oil and gas. Organization
of the Petroleum Exporting Countries (OPEC),
Western International Oil Corporations and
United States shale producers are the most
likely to respond.
In the medium term, Western governments
have encouraged more investment in
traditional upstream projects in domestic
markets. This is to act as a bridge for energy
security while new low‑carbon alternatives
are developed. This will include the need
for significant new upstream supply and
midstream energy infrastructure.
There’s been increased interest in climate‑
financing mechanisms. This will help developing
countries especially in their transition from
thermal coal to clean power. There are a range
of technical solutions that will aid existing
power generation sites to achieve a successful
energy transition. These include conversion
to biomass, implementation of CCUS or
conversion to new‑energy hubs.
The oil and gas industry is on the cusp of a
major transformation towards sustainability.
The consequences of Russia’s invasion have
shown just how important this pivot to
sustainability is.
Oil and gas operators have been benefiting
from strong, free cash flows, generating
cash to fund low‑carbon investments. This is
a result of resurgent demand, higher prices
and lower costs. Capex is expected to follow
suit. Projections say upstream oil and gas
spending should grow more than 15% year
on year1.
We’re helping our customers de‑bottleneck to
address their short‑term challenges. We’re also
helping them deal with near to medium‑term
expansion to overcome the global supply
constraints. At the same time, there’s a lot
of work still needed to achieve society’s
low‑carbon objectives. We’re well positioned
to support our customers in this rapidly
changing market.
1 Rystad Energy, Press release ‑ Global energy spending set to reach record high of over $2 trillion in 2022, led by oil and gas, 2022.
30
Worley 31
Annual Report 2022 Context and strategy
Market outlook and case studies
Case study | Traditional | Onshore
Assessing net‑zero technologies for
decarbonization of a provincial oil
and gas sector
Worley/Advisian supported a Canadian Provincial Ministry in assessing
net‑zero technologies for greenhouse gas abatement in the province’s oil
and gas sector. The study addressed the pathways required to meet the
province’s 2030, 2040 and 2050 climate objectives.
Our team of experts systematically identified the most relevant and
highest potential emission reduction opportunities for producers in
the province. A long list of opportunities and technologies were initially
developed. Abatement opportunities were then screened and categorized
into broad types of reduction (e.g. carbon capture and storage, energy
efficiency, electrification, methane recovery) while considering the full
scope of production stages, emission sources and energy inputs. The
relative cost effectiveness of the opportunities was presented through
marginal abatement cost curves.
Additionally, we facilitated a survey on behalf of the customer to gather
industry feedback on sector emission reduction opportunities. The survey
was critical in capturing the experience and outlook of the sector on
capital projects, aimed at reducing greenhouse gas emissions, as well as
insights on challenges and successes from an industry perspective.
Through our extensive knowledge of the energy sector, coupled with
our in‑house decarbonization expertise, we developed a comprehensive
roadmap to assist the Ministry in focusing their collective efforts in
terms of the support required to incentivize the adoption of abatement
technologies. The study will act as a foundation and provide guidance to
the Ministry in development of future climate policy for the province’s oil
and gas sector.
UN SDGs:
Business Value Drivers:
32
Worley Humber Region
Case study | Decarbonization | Carbon capture, use and storage (CCUS)
Carbon capture project award for Humber Zero
at VPI Immingham's power plant
We’ve been awarded a front‑end engineering and design
(FEED) contract by VPI Immingham LLP for a post‑
combustion carbon capture facility, part of the Humber
Zero project located in the UK.
The Humber region currently represents more than 40% of
the UK’s industrial emissions. The Humber Zero program
aims to remove up to 8 million tonnes of carbon dioxide
annually from the Immingham industrial area by 2030,
using CCUS technology.
This project includes a post‑combustion carbon capture
retrofit. The carbon captured from the plant will be
compressed and exported by pipeline to secure storage,
deep under the bed of the North Sea. The project has the
potential to abate around 3 million tonnes of C02 emissions
every year.
Worley has extensive expertise and experience in
delivering the critical phases of major projects, and
their appointment as FEED contractors for our part of
Humber Zero demonstrates rapid progress in the
development of this project. Decarbonization will be a
critical element of the UK Government’s commitment
to reducing greenhouse gas emissions, and carbon
capture and storage (CCS) will be central to achieving
those targets," said Jonathan Briggs, VPI Project
Director for Humber Zero.
UN SDGs:
Business Value Drivers:
33
Annual Report 2022 Case study | Traditional1 | Offshore
Supporting Shell’s
low‑carbon journey
in the Gulf of Mexico
We've been awarded a three‑year contract by Shell to
provide engineering and procurement services for five
of its assets in the Gulf of Mexico (GOM).
We're providing professional services in digital
enablement, engineering, procurement and support
fabrication and construction. We'll support the transition
to a digitized and more efficient project delivery model
for Shell's offshore assets. This aligns with Shell’s
continued work to lower the carbon intensity of its
GOM portfolio.
The work is being delivered by our offices in Metairie and
Houston, in America, and supported by our engineering
teams in India.
Our partnership is a real opportunity to create a positive
impact on the offshore operations and the communities
in the GOM at a time when making sustainable
transformation a reality is more important than ever.
This project is a great example of how we help our
customers optimize their asset efficiency, on the one
hand, while supporting decarbonization initiatives on
the other.
UN SDGs:
Business Value Drivers:
1 Portfolio will include projects across traditional and
sustainability solutions
Context and strategy
Market outlook and case studies
34
Worley Case study | Asset sustainability
| Decommissioning and restoration
Case study | Environment & Society
| Biodiversity compensation
Guiding New Zealand's first
major decommissioning
project
We completed a technical review of the decommissioning
application of the Umuroa and associated subsea oil fields
for the New Zealand Environmental Protection Agency.
We also suggested pathways to realize environmental
benefits. These included reducing impacts on the local
seabed and water column and using the latest approaches
to restore marine habitats with reefing.
We formed a multi‑office team to complete a technical
review of the decommissioning plan for the floating
production storage and offloading facilities.
This is a multimillion-dollar offshore
decommissioning and restoration project, and it’s
also a first for New Zealand," said John Cox, Global
Decommissioning Director, Advisian.
UN SDGs:
Business Value Drivers:
Maintaining zero net‑loss
of habitat
Our customer required engineering design for a fish
habitat compensation lake to fulfil government regulatory
requirements to maintain a zero net‑loss of habitat
across the project footprint. The lake will provide over
2.5 million habitat units that will compensate for impacts
to watercourses that are being removed or damaged due
to project development. The lake will eventually support
10 target fish species that are native to the region.
Throughout, Indigenous‑owned partnership, Mikisew
Advisian Environmental (MAE), completed a full
detailed design, including hydrologic analysis, civil
engineering, habitat feature, lake physiography and
hydraulic structures. MAE also developed a dynamic
water balance to support long‑term sustainability of
the lake’s hydrological cycle. A key component of the
project included detailed Indigenous consultation with
all seven Indigenous communities that hold the project
footprint within their traditional territory. A blessing
ceremony was held at the project site and attended by
all nations prior to construction on the lake commencing.
UN SDGs:
Business Value Drivers:
35
Annual Report 2022 Delivering a more sustainable world in
low-carbon energy
Offshore wind has seen a major boost in the last
12 months. Several countries have increased
their offshore wind targets to support their
decarbonization targets. These countries include
Germany, the US and the UK2.
As of June 2022, a hydrogen strategy is available
for 31 countries with an additional 18 countries
preparing their respective strategy3. The
production cost of green hydrogen is mainly
driven by the availability of low‑cost renewable
electricity. As a consequence, this will allow
new geographies to benefit from the global
energy market because participation will no
longer depend on the availability of oil and
gas reserves.
The power networks market is forecast to
reach a similar investment level as power
generation technology4. This will be needed
to connect new generation resources. It’ll also
help to reconfigure the grid – allowing for future
demands and a more distributed generation.
BloombergNEF has been forecasting the
investment that’ll be needed for the world to be
on track for net zero by 20505. They say energy
transition investment will need to:
• double in the next three years, compared
to 2021
• double again before 2030.
We've identified priority initiatives in the
low‑carbon sector to accelerate our solution
development and growth, including:
• low‑carbon hydrogen
• networks and energy storage
• CCUS and integrated gas.
We’ve made significant progress in all these
markets over the last 6‑12 months, and key
project wins have supported the initiatives.
Context and strategy
Market outlook and case studies
Low-carbon energy
More than 40 countries have set a net‑zero
target in the last 12 months. And almost 90% of
the world’s carbon dioxide emitters now have
a net‑zero target in force or under discussion1.
It’s widely agreed that electrification and
low‑carbon hydrogen will be vital for meeting
these goals.
More and more countries are supporting the
production of low‑carbon electricity. They’re
doing it through renewable resources like
offshore wind and solar, and also through
nuclear and biomass (including CCUS).
For example:
• the EU Commission has declared nuclear
and gas as suitable transition fuels,
(under certain conditions)
• nuclear, offshore wind and low‑carbon
hydrogen are at the center of the UK’s
energy security strategy.
Global gas demand is still growing. This has
caused the need for increased investment
across the integrated gas value chain.
The crisis in Ukraine has highlighted a need
for energy security and diversification of
supply. This is expected to incentivize a new
wave of LNG export, re‑gasification and
pipeline infrastructure buildout. It is expected
to accelerate the energy transition in the EU
to achieve energy security.
An increasing number of countries are taking the
first steps to develop the infrastructure needed.
They’re doing this through offtake agreements
for renewable energy, low‑carbon hydrogen and
e‑fuels. This includes players from all industry
sectors, for example: mining, oil and gas,
chemicals, steel, aviation and shipping.
1 BNEF, G‑20 zero carbon policy scoreboard, 2022.
2 BNEF, 1H2022 Offshore wind market outlook, 2022.
3 BNEF, hydrogen strategy tracker, 2022.
4 BNEF, energy outlook economic transition scenario, 2021.
5 BNEF, Energy transition investment trends, 2022.
36
Worley Case study | Decarbonization | Low-carbon hydrogen
Creating Shell’s green hydrogen
factory in the Netherlands
We’re providing overall project integration services for Shell’s new
200‑megawatt electrolysis‑based hydrogen plant, located at the Port
of Rotterdam, the Netherlands.
Once complete, the project will be one of the world's largest commercial
green hydrogen production facilities. Operations are scheduled to start by
2023 and will aim to produce ~50,000–60,000 kilograms of hydrogen per
day. Renewable energy will preferably be provided by the Hollandse Kust
(noord) offshore wind farm.
The green hydrogen produced will initially be used at the Shell
refinery in Pernis, the Netherlands, to partially decarbonize the production of
fossil fuels and support the industrial use of hydrogen in the heavy‑
transportation industry.
We completed the pre‑FEED and FEED services for the project in 2022.
Assuming a positive financial investment decision, our future scope will cover
engineering, procurement and construction management (EPCM) support for
the hydrogen production facility, and overall project integration services for
the offplot, including offshore wind, pipelines, grid and the refinery.
The project is being led from our offices in The Hague while also leveraging
our global hydrogen subject‑matter experts and capabilities.
We are very pleased to be supported by Worley for the engineering on
Shell’s Holland Hydrogen I plant. We look forward to a collaborative
working relationship with the Worley team,” said Lijs Groenendaal,
Business Opportunity Manager, Renewables and Energy
Solutions, Shell.
UN SDGs:
Business Value Drivers:
37
Annual Report 2022 Context and strategy
Market outlook and case studies
Case study | Decarbonization | Nuclear
Advancing Argentina’s nuclear SMR journey
SMRs have great potential for supplying electricity to
remote locations and industrial hubs with high energy
consumption. The 32‑MW prototype will have the capacity
to supply electricity to over 120,000 people.
UN SDGs:
Business Value Drivers:
We’re working with the Comisión Nacional de Energía
Atómica to complete the detailed engineering for its CAREM
25 nuclear small modular reactor (SMR) project in Argentina.
We’ll develop the detailed design of its four auxiliary process
systems for the CAREM 25 nuclear power plant. It’s a
prototype of a small nuclear reactor with a nominal power
of 32 megawatt (MW).
CAREM 25 is the first nuclear power reactor, both designed
and built in Argentina. It’s an indirect‑cycle reactor with
simplified features to increase safety. It will be used for
electricity generation, as a research reactor, and to power
seawater desalination plants.
38
Worley Case study | Decarbonization | Integrated gas
Maintaining long‑term gas supply for Chevron's LNG plant
We were awarded a contract to provide engineering
and construction management (EPCM) services to
Chevron Australia Pty Ltd (Chevron) for its Jansz‑lo
compression project.
The project will use subsea compression technology
to maintain long‑term gas supply from the Jansz‑lo field,
located around 200 km offshore from the north‑western
coast of Australia. The field will supply three existing LNG
trains and a domestic gas plant on Barrow Island.
The project involves the construction and installation of a
27,000‑tonne normally unattended floating field control
station, around 6,500 tonnes of subsea compression
infrastructure and a 135‑km submarine power cable
linked to Barrow Island. The project is expected to take
approximately five years to complete.
UN SDGs:
Business Value Drivers:
39
Annual Report 2022 Context and strategy
Market outlook and case studies
Case study | Decarbonization | Low-carbon hydrogen
Supporting Oman’s journey to low‑carbon fuel production
We’re providing concept‑feasibility study services to
develop Green Energy Oman’s (GEO) defined green
hydrogen energy project. This includes optimizing
around 25 gigawatts (GW) of wind and solar generation,
transforming this renewable energy through electrolysis
into green hydrogen, as well as the production, storage,
and export of green ammonia.
In addition to defining the project components, our study
will identify opportunities to enhance the in‑country
value delivered from the expected 10‑year project
implementation period. This includes employment and
development for Omani nationals and value adds through
local manufacturing and supply by Omani companies
across the supply chain.
The overall project aims to produce above 1.8 million
tonnes of low‑carbon green hydrogen, which can
produce up to 10 million tonnes of green ammonia per
annum, supporting the local economy and global market
by exporting green ammonia to help other countries
decarbonize their economies.
We’ll lead the work from our office in Muscat, Oman, with
support from our Centers of Excellence in Europe.
The GEO team, together with our technical specialists,
are at the vanguard of mega-scale green fuels project
development. The work being undertaken will place
Oman at the forefront of such projects, maximizing
the utilization of Oman’s natural resources of wind
and solar to produce green fuels and building the
country’s associated industry,” said Najla Zuhair Al
Jamali, CEO, Alternative Energy at OQ. Zuhair Al Jamali,
CEO Alternative Energy at OQ.
UN SDGs:
Business Value Drivers:
40
Worley Case study | Decarbonisation | Low-carbon hydrogen
Australian hydrogen market study
We completed an analysis of the competitiveness of green hydrogen across 25
Australian industry sectors for the Clean Energy Finance Corporation (CEFC), an
initiative backed by the Australian Government. The CEFC is responsible for the
$300 million Advancing Hydrogen Fund, with the aim of supporting the growth
of a clean, innovative, safe and competitive Australian hydrogen industry. Our
report provides insights into the commercial viability of green hydrogen over
three timeframes and includes detailed analysis of the economic, technological
and infrastructure factors that will underpin the green hydrogen economy.
It was commissioned to help identify investment opportunities for hydrogen
producers, large‑scale energy users and potential investors.
Our mission is to accelerate investment in Australia’s transition
to net zero emissions.” CEFC
UN SDGs:
Business Value Drivers:
Case study | Environment & Society | Community engagement
Building stakeholder trust for green hydrogen production
Gladstone city is an industrial center which has experienced
significant waves of development in the past. This has
contributed to a boom‑and‑bust cycle that has impacted the
community and resulted in some stakeholder groups being
cautious of new major industry developments.
We’re working to identify how the project can manage
potential social impacts and enhance project benefits. We’re
seeking to foster productive community relationships and
partnerships and maintain community acceptance for major
industry in the region.
Stanwell Corporation, together with its project partners,
are working to develop a commercial world‑scale project
to produce and export hydrogen in Gladstone. The
development of a new major industrial facility requires
community engagement and acceptance. We’re supporting
Stanwell through this process to understand community
and stakeholder perceptions and interests and to engage
stakeholders in the project. This also involves educating the
community and stakeholders about renewable hydrogen and
the benefits associated with hydrogen development.
UN SDGs:
Business Value Drivers:
41
Annual Report 2022 Context and strategy
Market outlook and case studies
Chemicals and fuels
Chemicals
Industry fundamentals were strong throughout
the year. Chemical demand and profitability
were above pre‑COVID‑19 pandemic levels in
most markets. As a result, we’re still seeing
growing investment linked both to overall gross
domestic product (GDP) growth and increased
focus on regional supply resilience.
We benefited during the year from our
leading global position and strong customer
relationships. Our customers have noticeably
increased their sustainability investments.
Fuels
Refinery utilization rates gradually improved
across the year. This is mostly because
economies recovered from the COVID‑19
pandemic and transportation activity increased.
Another factor was the continued trend in
the developed world of decommissioning and
converting old plants. Conversion projects
have changed plants into storage terminals
or to biomass‑based low‑carbon fuel
production facilities.
Again, we've benefited from these improved
market conditions. Much of this was due to our
customer positions and our ability to pivot with
the changing market.
Delivering a more sustainable world in
chemicals and fuels
Decarbonization was the leading theme across
the year in chemicals and fuels. We’ve seen
this in both end products and processes, with
most customers committing to 2030 and
2050 emissions‑reduction targets. This led
to investment commitments for existing and
new facilities.
42
These are the areas we’re working in, as part of
our strategy:
• Decarbonization The chemical industry
has a relatively low carbon emissions
footprint. Some of the changes needed
involve technologies that won’t be available
without large capital investments. So, we’re
emphasizing converting power and steam
generation to renewable energy and replacing
grey hydrogen production with low‑carbon
hydrogen (blue or green).
• Plastics recovery This has also become a
mainstream effort for the chemical industry.
There are global investments underway
across an array of different technologies.
These new technologies aim to reuse
end‑of‑life plastics as feedstock for new
plastics, chemicals and fuels.
• Low-carbon fuels The fuels industry has a
large carbon footprint as its products are
designed to be combusted. As a result, the
focus here has been on developing low‑carbon
fuels, based on non‑oil feedstock. Right now,
we’re seeing refineries converting to biomass‑
feedstock‑producing renewable diesel and
sustainable aviation fuels. We’re also in the
early stages of more advanced low‑carbon
fuels that use biomass and municipal wastes.
And we’re progressing to synthetic fuels,
based on captured carbon dioxide and green
hydrogen.
• Recovering and reusing sulfur Regulations
are tightening on the sulfur emissions from
transportation fuels and from smelters and
power plants. We’re focused on lowering these
emissions, and then converting the recovered
sulfur into sulfuric acid. Sulfuric acid has many
value‑adding uses in areas like mining and
fertilizer production. Our Comprimo® and
Chemetics® businesses are global leaders in
this important resource stewardship role.
We’re excited to be working with our customers
in developing these solutions. We’re helping to
deliver chemicals and fuels that meet essential
needs in ever‑improving ways.
Worley Case study | Resource stewardship | Plastics recovery
Working on Trinseo’s chemical recycling plant
We’re working on the FEED services for
Trinseo’s chemical recycling plant in Belgium,
Europe. The plant will use gasification
technology to depolymerize post‑consumer
polystyrene waste into pure styrene.
This project is the first of its kind on an
industrial scale.
Trinseo’s plant will process 15 kilotonnes of
recycled polystyrene flakes every year. These
will be transformed into high‑quality recycled
styrene and used for the production of new
polystyrene and/or styrene derivatives,
including acrylonitrile butadiene styrene (ABS)
and styrene acrylonitrile (SAN).
We completed the pre‑FEED services for the
project in 2021, and we have continued to the
next phase of the work.
Trinseo chose Worley to move forward
with because of its recognized leadership
in the industry. Worley’s strong
commitment to sustainability is critical for
us as we continue our journey and goal of
delivering sustainable material solutions
while maintaining high quality
and performance,” said Francesca
Reverberi, SVP and Chief Sustainability
Officer at Trinseo.
UN SDGs:
Business Value Drivers:
43
Annual Report 2022 Context and strategy
Market outlook and case studies
The new hydroprocessed esters
and fatty acids (HEFA) plant we are
building is a major investment,
vital to Shell Energy and Chemicals
Park Rotterdam’s path to net zero.
We can only make Shell’s
transformation and the energy
transition successful when we
work together with strong
partners. We are therefore proud
to collaborate with Worley, helping
to engineer a more sustainable
world," said Jos van Winsen,
General Manager, Shell Energy and
Chemicals Park Rotterdam.
Case study | Decarbonization | Low-carbon fuels
Supporting Shell on a major low‑carbon fuels project
in the Netherlands
We’re providing detailed design and procurement services
to support the development of a low‑carbon fuels facility
at the Shell Energy and Chemicals Park Rotterdam in the
Netherlands.
The facility is expected to be one of the largest of its kind
in Europe and will aim to produce 820,000 tonnes of
sustainable aviation fuel (SAF) and renewable diesel every
year. These fuels will help to meet growing demand from
the transport sector, including hard‑to‑decarbonize sectors
such as heavy road transport and aviation. The renewable
diesel alone could avoid 2.8 million tonnes of CO2 emissions
a year. This is the equivalent of taking more than one million
European cars off the roads.
The renewable diesel and SAF will be produced from waste,
including used cooking oil, certified sustainable vegetable
oils, waste animal fat and other industrial and agricultural
residue, using advanced technology developed by Shell. The
fuels will be used for blending, which will support the EU
legislation and commitments under the Paris Agreement.
The award follows the collaboration between Shell and
Worley over the last 18 months to define the project as
an integrated team, using new ways of working.
UN SDGs:
Business Value Drivers:
44
Worley Case study | Decarbonization | CCUS
Advancing a carbon capture
project at the Phillips 66
Humber Refinery
We’re working alongside Phillips 66 on the early front‑
end engineering services for a carbon capture facility
at its Humber Refinery in the UK. The refinery is on
track to become the first in the world to reduce its
carbon emissions using a technology pioneered by Shell,
called CANSOLV.
CANSOLV will be deployed to capture carbon produced
in the refinery’s fluid catalytic cracking (FCC) process.
The technology has the potential to capture at least
95% of the CO2 in the FCC flue gas, compressing it
before the gas is transported to safe storage under the
North Sea.
Our role is to integrate the carbon capture technology
into the refinery. And we're also responsible for the
design of the infrastructure required to export the CO2
for transport and storage safely under the North Sea.
This is another project supporting the Humber Zero
initiative.
UN SDGs:
Business Value Drivers:
Case study | Traditional | Chemicals
Supporting INEOS
Styrolution on a world‑scale
ABS plant
We’re providing the detailed design and engineering,
procurement and construction management (EPCM)
services to support INEOS Styrolution’s investment in
building a world‑scale acrylonitrile butadiene styrene
(ABS) plant in Ningbo, Zhejiang Province, China.
The development of the new site is part of INEOS
Styrolution’s larger expansion plans into China. Its
annual capacity is planned to be 600,000 tonnes of
ABS. The facility stands as INEOS Styrolution’s largest
investment in the region and the largest single‑train
ABS process plant in the industry.
Before detailed design and EPCM, we delivered the
front‑end engineering and design (FEED) and cost
estimation services for the project. Construction
commenced in December 2020 and completion and
start‑up is expected in 2023.
I am excited to see us building a world-class ABS
manufacturing plant here in Ningbo. ABS is a
versatile high-performance styrenic resin. Its
properties make it the material of choice for many
everyday products across industries, including
automotive, electronics, household, healthcare
and toys/sports/leisure. This investment affirms
our commitment to support the growth of our
customers in Asia,” said Rob Buntinx, President,
Asia Pacific, at INEOS Styrolution.
The services are being delivered by our offices in China
with support from our global offices in Australia,
Belgium, Singapore, Malaysia, and the US.
UN SDGs:
Business Value Drivers:
45
Annual Report 2022 Context and strategy
Market outlook and case studies
Resources
The resources sector has seen growth and
strategic transformation. Since 2020, capital
spend in mining has increased significantly, year
on year, across all commodities. Across our top
15 global resources customers by revenue, we
saw a 100% increase in wins in FY2022, with
some large greenfield projects returning to
the pipeline.
We’re working on early stage assignments for
projects with a capital value of over $30 billion.
Over 80% of this spend relates to future‑facing
minerals to feed the energy transition and
to create advanced fertilizer products. We're
providing holistic solutions and proactively
partnering for capability and capacity.
Delivering a more sustainable world in
resources
We’ve seen exponential growth in the
fast‑moving sub‑sector of active materials,
which are key to large‑scale battery
manufacturing. This is the result of a global
supply shortage. We’ve taken a market‑leading
position in European cathode and anode
production plants, and we’re working with
our customers to help secure a supply chain
of both raw and active materials.
We’ll need new sources of materials
as manufacturers deal with disrupted
supply chains.
We’re delivering creative solutions for
sustainable and socially responsible mining
We’re using our regulatory, environmental and
water capability to help our customers:
• decarbonize operations
• provide greater water stewardship
• invest in areas associated with their
social license.
This leads to mutual value creation, as well
as respect among stakeholders. We’re active
corporate citizens in the communities where
our delivery teams are based. We have several
community‑based programs underway to create
positive legacies from our project work.
We’re involved in key emerging areas,
presenting growth opportunities
We’re seeing a clear trend across copper and
broader energy transition metals. Customers are
investigating the economic and financial viability
of several large underground resources. This is
a result of surface deposits becoming depleted
or scarce.
We have a leading position in supporting the
development of large‑scale underground
mining operations. This industry has been
accelerated by the US and Canada’s new
government incentives for the critical minerals
industry. And we’re strongly positioned in the
largest markets.
Miners are seeking innovation advantages to
accelerate carbon management plans or provide
safer or less intrusive environmental solutions.
Our investment in groundbreaking ore‑sorting
technology through NextOre™ is one example
where we seek to work together with scientists
and business partners to accelerate the
adoption of enabling technology to make mining
operations more sustainable.
46
Worley Case study | Decarbonization | Energy transition materials
Supporting the production of battery‑grade lithium carbonate
Battery demand is increasing as a result of our global
commitment to the energy transition, where electron
mobility and storage are critical.
We've been supporting Galaxy's Sal de Vida project for the
last three years, providing EPCM services for their tier 1
lithium brine project. The Sal de Vida deposit lies within the
“lithium triangle”, an area encompassing Chile, Bolivia and
Argentina that contains a significant portion of the world’s
estimated lithium resources. Catamarca, in Argentina, is
a proven mining jurisdiction, home to several successful
mining operations and development projects.
UN SDGs:
Business Value Drivers:
47
Annual Report 2022 Context and strategy
Market outlook and case studies
Case study | Decarbonization | Energy transition materials
Stewarding the journey from pit to precursor
We're providing construction management services for
Syrah’s initial expansion of its active anode material AAM
facility in Vidalia, United States.
Syrah’s vision is to be the world’s leading supplier of
superior quality graphite products and the first major
integrated ex‑China producer of natural graphite AAM
that is battery‑ready for electric vehicles.
Syrah owns and operates the Balama graphite mine and
processing facility in Mozambique, which is one of the
largest in the country and around the world. Processed
graphite material from the mine will supply their future AAM
facility under construction in Vidalia.
Our journey with Syrah began with designing its Balama
natural graphite mine and processing plant from our offices
in Melbourne, Australia.
Having worked closely with Syrah through the previous
phases of the project – including the bankable feasibility
study, front‑end engineering and design, and detailed
engineering and procurement – our significant knowledge
of the proposed processing technologies, key equipment
packages, and integration with Syrah's project team were
key to us securing this extended role.
UN SDGs:
Business Value Drivers:
Syrah's long-term value proposition is fundamentally underpinned by:
• The accelerating electrification of the global transport fleet;
• Graphite mining maintaining its high intensity in use in lithium-ion batteries,
which is a primary battery technology for EVs for the foreseeable future;
• Balama being the world's largest integrated natural graphite operation; and
• Our downstream strategy to become a large-scale producer of value-added
active anode material products for the battery supply chain,”
Shaun Verner, Managing Director & Chief Executive Officer of Syrah.
48
Worley
Case study | Resource stewardship | Water
Supporting groundwater
remediation
Local groundwater is a key source of water that the city
of Los Angeles relies upon, with the primary source of
local groundwater being the San Fernando Basin. The
basin underlies most of the San Fernando Valley and is
home to one of the largest contamination sites in the
United States.
As a result of groundwater contamination issues, over
half of the water production wells in the basin have been
removed from service. Our customer, LADWP, wants to
restore groundwater through remediation to remove
contamination from the basin. Together with the owner's
agent team of Hazen & Sawyer, we're providing expertise
through remediation feasibility, groundwater modelling
and risk assessment to evaluate and support the design
of groundwater remediation facilities. Cleaning up the
San Fernando Basin is a massive undertaking that will
transform one of the city’s key water sources to ensure
that this basin remains a consistent, stable and reliable
resource for years to come.
UN SDGs:
Business Value Drivers:
Case study | Traditional | Iron ore
Building a “Mine of the Future”
Rio Tinto’s Gudai‑Darri Phase 1 encompasses a full suite
of EPCM services where we participated through the
entire project lifecycle, starting with early phase studies
through to project delivery. This greenfields mine facility
also includes a digital twin delivery, using the SmartPlant
software suite. Our scope of facilities includes primary
crushers, coarse ore stockpile, secondary crushing and
screening, surge bins, stockyard components (including
conveyors, stackers and reclaimers), transfer stations,
dust collection towers and train load out and rail loop.
This project features an unprecedented deployment of
technology innovations, including autonomous trucks,
trains and drills, as well as the world’s first autonomous
water trucks, to make Gudai‑Darri Rio Tinto’s most
technologically advanced iron ore mine. The extensive
digital delivery has led to improved HSE outcomes, due
to identifying and resolving a large number of site safety
issues during 3D model review sessions.
UN SDGs:
Business Value Drivers:
49
Annual Report 2022 Operating and Financial Review
1.1 Operations
1.1.1 Overview
We're a global high-value solutions provider for a diverse range
of end markets in energy, chemicals and resources. We bring our
customers data-driven and technology-driven solutions at every
stage of the project lifecycle, from initial concepts to sustaining
and enhancing their assets.
We hold leadership positions across the industries we serve.
We support our customers as they transition to achieve their
commitments across both their traditional businesses and their
sustainability investments.
We provide traditional and sustainability-related services across
all of our sectors (energy, chemicals and resources) and our
markets (core, transitional and breakthrough). Our sustainability
solutions provide the structural framework for growth as
we focus on high-value propositions in areas of accelerating
investment spend. These support all of the markets we serve.
Our sectors are:
1. Energy – producing energy from conventional (e.g. coal,
oil) and low-carbon energy sources (e.g. gas, wind, solar,
hydrogen) as well as undertaking projects related to power
generation, transmission and distribution;
2. Chemicals – manufacturing, processing and refining chemicals
and fuels (for example, renewable fuels, petrochemicals,
polymers and specialty chemicals); and
3. Resources – processing mineral and metal resources
(for example, resources that are central to the energy
transition and resource projects related to water use
and re-use, the environment, transport, ports and site
remediation and decommissioning).
Our existing and emerging customers include multinational
energy, chemicals and resources companies. We serve regionally
and locally focused companies, national oil companies and
government-owned utilities. Our ten largest customers account
for 38% of our aggregated revenue. Of our 20 largest customers,
80% have net-zero Scope 1 and Scope 2 targets by at least
2050. This supports our ambition for 75% of our revenue to
come from sustainability-related business. It also highlights
that our continued involvement in traditional work presents us
with an opportunity to lower the carbon impact of the remaining
carbon-intensive assets.
1.1.2 Business model
Our project delivery and technical specialists work across
the globe. We generate earnings by charging for the time we
spend performing professional and field-based services. We
offer a suite of digital products and proprietary technologies.
We engage via alternative low-risk commercial models which
reward us for the value we bring.
Our contract types include:
• Reimbursable contracts (~80% of our revenue):
� Contracts based on reimbursement of reasonable and
allowable actual costs plus profits. In addition to the base
profits generated from these contracts, further incentives
may also be earned from the creation of enhanced value
for the customer, depending on individual contract terms
and conditions. In negotiation with our customers, we
are typically able to adjust our contracts in accordance
with inflation and wage increases.
Energy
Chemicals
Resources
Conventional energy
Low-carbon energy
Chemicals and fuels
Resources
Combustion energy
Midstream infrastructure
Offshore oil
Onshore oil
Integrated gas
Renewable energy
Low-carbon hydrogen
Nuclear power
Power networks
and energy storage
Carbon capture, use
and storage
Chemicals
Low-carbon fuels
Refined fuels
Petrochemicals
Plastics recovery
Specialty chemicals
Sulphur recovery
Bulk commodities
Energy transition materials
Fertilizers
Precious metals
Resource infrastructure
Water1
Decarbonization
Resource stewardship
Asset sustainability
Environment and society
Sustainability solutions support all the markets we serve
1 In FY2021, water is reported under energy. All other energy, chemicals and resources sub-sectors remain the same in FY2022.
50
50
Worley
Worley • Fixed-price contracts (~20% of our revenue):
� Lump sum services contracts, where we can control
the outcomes. These typically have a short duration
(on average, under 6 months) and would generally take
into consideration inflationary expectations.
� Lump sum engineering, procurement and construction (EPC),
typically where we’ve completed the preceding phases
and are confident of the scope. We could see an increase
in these types of contracts in the future if they present the
opportunity for higher margins while minimizing risk.
� Construction lump sum contracts, for example, some of our
construction projects are lump sum.
� Lump Sum Turn Key (LSTK), where we take on some of the
risk for the plant start-up and achieving normal operations.
We do not competitively bid for LSTK, and it constitutes a
very minor portion of our revenue (significantly less than 1%).
We only take on LSTK contracts when we are involved in the
project from the start and so have a deep understanding of
what risks we need to manage and have the confidence we
can manage them.
We have minimal direct exposure to supply chain risk as we
typically purchase materials on behalf of our customers.
We use a controlled framework to guide and determine
the type of projects we bid and work on. This includes our
Responsible Business Assessment Standard, used to manage
reputational risk.
Aggregated revenue and profit: We generate our sources
of revenue and profit from many customers. As a result, we
don’t depend on any one of our customers for a significant
portion of our revenue or profit. Aggregated revenue doesn’t
include revenue that has nil margin (this typically relates to
procurement revenue where we undertake procurement on
our customers’ behalf with no exposure to financing costs or
warranty obligations).
We include revenue attributable to associates within aggregated
revenue. We believe disclosing this revenue provides more
information about the financial results of the Group.
Costs: Our largest costs are staff, technology, reimbursable
expenses and administration, which includes office leases.
Assets and liabilities: The significant items on our balance sheet
are mainly project related, such as trade receivables, unbilled
contract revenue and provisions and borrowings.
We hold several intangible assets, generated from previous
acquisitions. Our working capital is not capital intensive. Our
customers pay us at longer intervals than we pay some of our
expenses (for example, staff salaries). This time difference,
including the time from incurring the costs to invoicing the
customer, makes up the majority of our working capital
requirements.
How we drive long-term shareholder value
We drive shareholder value through our industry-leading capabilities, our diversification across end markets, customer
spend and geographies, and through our balance sheet.
We have the financial strength to support our growth initiatives and shareholder returns.
Global leader, delivering knowledge-
based project and asset services
• Leading market position to deliver
clean and affordable energy,
address climate change and further
economic development
• Innovative solutions to solve complex
challenges through our flexible workforce
and technology
Global earnings base and
broad end markets provide
diversification
Balance sheet to support
growth initiatives and
shareholder returns
• Balanced exposure to customer
• Strategic growth investment to
spend (Opex/Capex)
accelerate market capture
• Low-risk commercial models
• Gearing at levels supportive of
future growth
51
Annual Report 2022 Operating and Financial Review
Global operations
Prudhoe Bay
Anchorage
Fort McMurray
Vancouver, BC
Cold Lake
Kincardine
Sudbury
Edmonton
Blackfalds
Chicago
Calgary
Billings Bismarck
Sarnia
Denver
Folsom
Oak Ridge
Sulphur
Houston
Pasadena
Markham
Pickering
Bowmanville
Saint John
Reading
Charleston
Jacksonville
Lakeland
Metairie
Baton Rouge
Concord
Monrovia
Long Beach
Santa Ana
Bogotá
Chaguanas
Lima
Guajará-Mirim
Belo Horizonte
São Paulo
Rio de Janeiro
Altamira
Santiago
Buenos Aires
Bahía Blanca
Phoenix
Mexico City
46
countries
51,000+
people
52
Stavanger
Meerssen
The Hague
Arnhem
Assen
London
Cologne
Schkopau
Schwarzheide
Ludwigshafen
Kungalv
Stenungsund
Copenhagen
Ghent
Antwerp
Plzeň
Assen
Arnhem
Madrid
Cádiz
Casablanca
Aberdeen
Teesside
Glasgow
Stockton
-on-Tees
Stockport
Manchester
Great Yarmouth
Grimsby
Bristol
Leeds
Lagos
Atyrau
Fahaheel
Ahmadi
Manama
Dubai
Sofia
Baku
Tashkent
Almaty
Cairo
Basrah
Al Khobar
Riyadh
Doha
Abu Dhabi
Vadodara
Muscat
Mumbai Pune
Bangalore
Kolkata
Hyderabad
Chennai
Beijing
Tianjin
Chengdu
Nanjing
Shanghai
Kuala Lumpur
Singapore
Kiri
Bangkok
Kerteh
Manila
Kota Kinabalu
Kuala Belait
Jakarta
Dili
Harare
Johannesburg
Esperance
Perth
Adelaide
Exmouth
Kwinana
Bunbury
Portland
Ararat
Geelong
Melbourne
Garbutt
Mackay
Gladstone
Brisbane
Newcastle
North Sydney
New Plymouth
Christchurch
Auckland
Hastings
Wellington
WorleyOperating and Financial Review
Stavanger
Meerssen
The Hague
Arnhem
Assen
Cologne
Schkopau
Schwarzheide
London
Ghent
Antwerp
Ludwigshafen
Kungalv
Stenungsund
Copenhagen
Plzeň
Assen
Arnhem
Aberdeen
Teesside
Glasgow
Stockton
-on-Tees
Stockport
Manchester
Great Yarmouth
Grimsby
Bristol
Leeds
Madrid
Cádiz
Casablanca
Lagos
Sofia
Baku
Tashkent
Almaty
Beijing
Tianjin
Atyrau
Fahaheel
Ahmadi
Manama
Dubai
Chengdu
Nanjing
Shanghai
Kolkata
Vadodara
Muscat
Mumbai Pune
Bangalore
Hyderabad
Chennai
Kuala Lumpur
Singapore
Kiri
Bangkok
Kerteh
Manila
Kota Kinabalu
Kuala Belait
Jakarta
Dili
Cairo
Al Khobar
Basrah
Riyadh
Doha
Abu Dhabi
Harare
Johannesburg
Exmouth
Esperance
Perth
Adelaide
Kwinana
Bunbury
Portland
Ararat
Geelong
Melbourne
Garbutt
Mackay
Gladstone
Brisbane
Newcastle
North Sydney
New Plymouth
Christchurch
Auckland
Hastings
Wellington
Our Moscow and Sakhalin offices were removed in FY2022, given our planned withdrawal from Russia.
53
Annual Report 2022
Operating and Financial Review
1.1.3 Review of operations
We manage operations in two regions; the Americas as one
region and the combination of Europe, Middle East and Africa
(EMEA) and Asia Pacific, Australia and China (APAC) as the other.
This structure simplifies how we engage with our customers. It
allows us to collaborate across the business and bring the best of
our capability to help our customers solve their challenges. When
reporting the two operating regions, we disclose these activities
in three parts: the Americas, EMEA and APAC, and by three
sectors: energy, chemicals and resources.
This year, we’ve seen activity levels return as customers
across all our sectors have increased their capital investments.
We’ve seen projects that were deferred during the COVID-19
pandemic recommence. Site access has opened again, and we
are managing COVID-19 risks on a site by site basis, working in
collaboration with our customers. While, on balance, activity
levels are increasing, global challenges such as inflation and
supply chain disruptions are causing some customers to
rethink the timing of certain projects.
This year, we made the decision to make a planned withdrawal
of our services from Russia. Consistent with our purpose and
values, we have prioritized the safety, health and well-being
of our people, including those in Russia.
We’re focused on providing a safe work environment, both
physical and psychological, for our office and field-based
teams. Our focus on safety and well-being was evident during
our safety week where we connected our office-based people
with our site teams around the world. We had more than
10,000 people participating.
We're investing in our people to strengthen the Worley
experience and to build the right environment to attract and
retain critical capabilities. Meanwhile, the transferable skills of
our people and their flexible skill base are enabling our transition
into new markets.
We’re well positioned as a scalable business and continue to
benefit from our cost-savings initiatives. We’re now well into
the new way of working as we benefit from this restructure
along with programs targeting discretionary spend and
property rationalization. We continue to provide flexible working
arrangements for our people and digitize our business, allowing
us to save on property costs and billable travel savings into
the future.
In aggregate, we’ve achieved our operational cost-savings target
six months ahead of schedule and delivered $361 million of
annualized savings by the end of June 2022. We increased our
target to $375 million of annualized savings by the end of June
2023. FY2022 costs in relation to this program have been less
than half of FY2021.
The result for FY2022 was a net profit after tax, excluding the
post-tax impact of amortization on intangible assets acquired
through business combinations, NPATA, of $243 million,
compared with $157 million in FY2021. Underlying NPATA was
$329 million for FY2022, up 19% or $52 million on the previous
corresponding period1. Aggregated revenue increased by 3%,
compared to FY2021.
We delivered an improved second half FY2022. Our second half
underlying EBITA of $296 million was up 18% on the first half of
FY2022. The main factors contributing to this result were rate
improvements, particularly in sustainability related professional
services, and the retention of benefits from our costs savings
program which is increasing our operating leverage.
Our Global Integrated Delivery (GID) supported our margin
improvements, which grew by 28% in FY2022. Our GID team
in India work on projects all over the world and seamlessly
transition between projects, allowing us to achieve high rates of
utilization and consistently high quality of work.
Our rate improvements were partially offset by our investment
spend of $30 million. This is part of a $100m commitment to
accelerate our transformation which will deliver future growth in
our strategic priority areas.
1 FY2021 prior period has been restated. Refer to note 2E in the financial statements.
54
WorleyOperating and Financial Review All our core markets are experiencing investment growth, with
increases in both our backlog and factored sales pipeline. Backlog
is $15.4 billion, compared to $14.3 billion at 30 June 2021. Our
backlog is up 8% with activity levels on long-term projects
returning. Sustainability backlog has increased by 23% from
FY2021. We have seen key project wins and we continue to win
work in line with our expectations. Our factored sales pipeline
(factored for likelihood of project proceeding and award to
Worley) is up 30% in FY2022.
Our headcount is 51,000+ people, and we have a presence in
46 countries, compared with 47,700 people across 49 countries
at 30 June 2021.
The statutory operating cash flow is $316m versus the FY2021
operating cash flow of $533m. Underlying operating cash,
excluding tax and interest, is $376m, and cash conversion is 88%.
The days sales outstanding (DSO) fell by 5 to 63 days over FY2022.
There is an improvement in cash conversion compared to the
first half. Cash conversion was down in the first half because of
movements in working capital, particularly from the reversal of
higher than our average days payable outstanding (DPO) levels and
trade payable balances at 30 June 2021. These were temporary in
nature and increased the cash payments made in the first half. This
was partly due to the implementation of a new financial accounting
system in FY2021 which created a backlog of accrued payments
by year end. We cleared the backlog in the first half of FY2022. Our
net operating cash flow for the second half of the year returned to
track earnings more closely.
We’ve maintained our strong financial position through our
long-term debt maturity profile. Our steady gearing ratio
(22.6% at 30 June 2022) is at levels supportive of future growth.
Sustainability work has been a key driver of our growth.
In FY2022, sustainability related work represented 35% of our
aggregated revenue. $3.2 billion of aggregated revenue was
from sustainability related work, up from $2.8 billion in FY2021,
and at more favorable margins. Sustainability opportunities
at 56% of our factored sales pipeline (factored for likelihood of
project proceeding and award to Worley). See page 27 for how
we define our sustainability related work.
Our sustainability related work breakdown
Decarbonization
%
e
u
n
e
v
e
R
23%
12%
26%
9%
40%
23%
49%
24%
FY2021
FY2022
Jul-21
Jul-22
Resource stewardship
%
e
u
n
e
v
e
R
s
a
g
d
e
t
a
r
g
e
t
n
I
4%
4%
5%
6%
FY2021
FY2022
Jul-21
Jul-22
Revenue
Factored sales pipeline1
Revenue
Factored sales pipeline1
Environment and society
Asset sustainability
%
e
u
n
e
v
e
R
2%
2%
0.4%
0.4%
FY2021
FY2022
Jul-21
Jul-22
Revenue
Factored sales pipeline1
%
e
u
n
e
v
e
R
3%
3%
1%
0.4%
FY2021
FY2022
Jul-21
Jul-22
Revenue
Factored sales pipeline1
1.1.4 Significant changes in operations
The final element of our current cost-saving initiative is our
shared services program. This is already bringing added
efficiency to our IT, people and finance departments through
centralization and common data platforms. Our cost-savings
initiatives involve permanent structural changes which will allow
the business to scale as we grow, providing operational leverage.
1 Factored for likelihood of project proceeding and being awarded to Worley.
We've begun the safe withdrawal of our services provided in and
into Russia, and will not enter into new contracts. The loss of
Russian income is being replaced by higher activity in Europe as
the EU seeks to secure energy supply sovereignty for the future.
55
Annual Report 2022
1.1.5 Materiality
We focus on what is important for our business and the
world around us
We continually engage with our stakeholders and make the
material sustainability issues for our business a priority.
This year, we:
• surveyed nearly 1,000 of our people to understand what is
important to them
• engaged with investors to understand their concerns
• monitored the issues that others in our sectors feel
are important
• reviewed the sentiment toward ESG issues from a range of other
stakeholders, including our supply chain and communities.
1
Identify potential
material issues
2
Gather
information
M
A
T
E
R
I
A
L
I
T
Y
I
N
F
O
R
M
I
N
G
6
Review
and monitor
5
Take
actions
B
U
S
I
N
E
S
S
S
T
R
A
T
E
G
Y
3
Analyze
data
4
Validate material issues
Albany Grasmere Wind Farm, for which Worley has been providing operations and maintenance services since 2018.
56
WorleyOperating and Financial Review
We see sustainability issues through the lens of the UN SDGs
In our annual assessment process, we consider two different kinds of issues:
• those that have a significant impact on our business; how we run our business
• those of importance in society that our business can have an impact on; our role in the world.
This is what drives our sustainability strategy and what we report on. Our biggest role is supporting our customers on their
sustainability journeys. We're also delivering on our own sustainability commitments and strengthening our ESG performance.
This year, our assessment identified the following four UN SDGs that are material to Worley
Material issues
Summary of progress in FY2022
Value drivers
We support healthy
lives and promote
well-being
We provide access
to sustainable and
modern energy
We deliver the
infrastructure
essential for
sustainable
development
We provide the
solutions critical
to climate action
• Acted on over 80 improvement suggestions to enhance HSE outcomes
• Updated our assurance standards to improve the psychological safety of
our people
• Acted on our Inclusion Survey findings, building a culture of inclusion,
belonging and respect
• Provided inclusion training for over 460 of our leaders
• Increased our delivery experience to more than 3,300+ Energy
Transition Projects
• Empowered communities with clean energy through Worley Foundation
sponsorship of Energy for All and the Pollinate Foundation
• Provided insights to the energy transition through our involvement in industry
coalitions including the Energy Transitions Commission
• Released our ambition to be a leader in sustainability solutions and grow our
involvement in decarbonization
• Published groundbreaking research on the delivery of the complex industrial
infrastructure required to achieve net-zero by 2050, in partnership with
Princeton’s Andlinger Center for Energy and the Environment
• Updated our engineering design practices, further embedding sustainability in
the way we deliver projects
• Distributed $9,814m of economic value into our economies and communities
• Revised our Climate Change Position Statement, raising our ambition
on climate action
• Reduced our Scope 1 and Scope 2 emissions by 29%
• Advanced our disclosure of Scope 3 emissions
• Furthered implementation of our Sustainable Solutions process into
the way we deliver projects
• Convened a leaders’ roundtable at COP26, forging new partnerships
to deliver net zero
Page 88
Page 95
Page 63
Page 71
Page 88
Page 95
Page 74
Page 95
Page 63
Page 71
Page 74
Page 95
Page 71
Page 63
57
Annual Report 2022 Operating and Financial Review
1.2 Performance
In this section, we provide a review of performance against the business value
drivers shown below:
1.2.1 Finance
(page 58)
1.2.2 Knowledge, technology
and data (page 63)
1.2.3 Equipment and fabrication
(page 71)
1.2.1 Finance
Our finance business value driver refers to our active capital management from diverse and competitive sources, driving business
growth and value for our investors.
In the following table, we show the reconciliation of the underlying earnings before interest, tax and amortization on intangible assets
we’ve acquired through business combinations (EBITA) and underlying NPATA results to the EBITA as well as NPATA attributable to
members of Worley Limited.
58
WorleyOperating and Financial Review These three measures are the key to understanding our results:
1. Aggregated revenue
2. EBITA (earnings before interest, tax and amortization) and
3. NPATA (net profit after tax and amortization) attributable to members of Worley Limited.
EBITA
Costs in relation to cost saving programs
Impact of transformation and restructuring:
Shared services transformation
Payroll and other restructuring costs
Property leased assets (impairment reversals)/impairment
Transition costs
International government subsidies, net of direct costs
Net impact of historical legal matters
Impact of withdrawal from Russia
Impairment of other assets
Gain on disposal of subsidiary/investment
Impairment of investments including equity accounted associates
Certain other one off items
Total of underlying adjustments to EBITA
Underlying EBITA
Net finance costs
One off costs of refinancing debt with Euro Medium Term Note (EMTN) issuance
Income tax expense
Net tax expense on items excluded from underlying earnings
Tax on acquired intangibles
Underlying tax adjustments
Non-controlling interests
Underlying NPATA attributable to members of Worley Limited
Total of underlying adjustments to EBITA
One off costs of refinancing debt with EMTN issuance
Net tax expense on the items excluded from underlying earnings
Underlying tax adjustments
Amortization of acquired intangible assets
Tax on acquired amortization
NPAT attributable to members of Worley Limited
1 FY2021 prior period has been restated. Refer to note 2E in the financial statements.
FY2022
$’M
449
67
FY20211
$’M
319
199
53
15
(4)
3
(2)
16
14
2
–
1
–
98
547
(60)
–
(117)
(12)
(24)
–
(5)
329
(98)
–
12
–
(95)
24
172
–
84
60
55
(70)
–
–
12
(7)
11
(1)
144
463
(77)
4
(61)
(39)
(25)
11
1
277
(144)
(4)
39
(11)
(100)
25
82
59
Annual Report 2022 FY2022
$’M
FY20211
$’M COMMENTS
1. Aggregated revenue
9,065
8,774 We define aggregated revenue as:
• our revenue and income calculated in accordance
with relevant accounting standards;
• plus our share of revenue earned by
our associates;
• less procurement revenue at nil margin,
pass-through revenue at nil margin and
interest income.
EBITA means earnings before interest, tax and
amortization on intangible assets acquired through
business combinations.
2. EBITA
(statutory)
449
319
(underlying)
547
463
3. NPATA (statutory)
243
157 NPATA means net profit after tax excluding the
post-tax impact of amortization on intangible
assets acquired through business combinations.
MOVEMENT
Our aggregated revenue increased by 3% in FY2022
when compared with that for FY2021, driven by
growth in demand.
Our statutory EBITA increased by 41% in FY2022
when compared with that for FY2021. The statutory
result was impacted by non-recurring charges such
as transformation and restructuring costs.
Our underlying EBITA increased by 18% in FY2022
when compared with that for FY2021, driven by
a continuing improvement in rate, particularly in
sustainability related professional services, and the
retention of benefits from our costs savings program.
Underlying EBITA margin has increased from 5.3% in
FY2021 to 6.0% in FY2022.
Statutory NPATA increased by 55% in FY2022
when compared with that for FY2021.
(underlying)
329
277
Underlying NPATA increased by 19% in FY202.
Kuwait Environmental Remediation Program
1 FY2021 prior period has been restated. Refer to note 2E in the financial statements.
60
WorleyOperating and Financial Review Operating performance
Americas
The Americas region, comprising the United States, Canada and Latin America, reported aggregated revenue of $4,187 million
and segment EBITA of $271 million (FY2021: aggregated revenue of $3,769 million and segment EBITA of $258 million). Americas
EBITA was driven by a strong H2 with a ramp up of key projects and improved margins in the construction and fabrication business
from H1. The segment margin decreased to 6.5% from 6.8%. The Americas margin was impacted by business mix and a one-off
project impact in FY2022.
AGGREGATED REVENUE
$’M
VARIANCE %
4,187
3,769
11
(31)
CONTRIBUTION
TO GROUP
AGGREGATED
REVENUE
%
46
43
SEGMENT EBITA
VARIANCE %
5
(48)
$’M
271
258
SEGMENT
MARGIN
%
6.5
6.8
FY2022
FY20211
EMEA
Europe, Middle East and Africa (EMEA) reported aggregated revenue of $3,168 million and segment EBITA of $283 million
(FY2021: aggregated revenue of $3,333 million and segment EBITA of $202 million). EMEA EBITA was up, based on rate
improvements in professional services work through an increase in sustainability projects while maintaining cost base. The segment
margin increased to 8.9% from 6.1%. The EMEA margin was supported by higher margin projects in FY2022.
AGGREGATED REVENUE
$’M
VARIANCE %
3,168
3,333
(5)
(13)
CONTRIBUTION
TO GROUP
AGGREGATED
REVENUE
%
35
38
SEGMENT EBITA
VARIANCE %
40
(19)
$’M
283
202
SEGMENT
MARGIN
%
8.9
6.1
FY2022
FY2021
APAC
Australia, Pacific, Asia and China (APAC) reported aggregated revenue of $1,710 million and segment EBITA of $181 million,
(FY2021: aggregated revenue of $1,672 million and segment EBITA of $152 million). APAC EBITA increase was driven by volume
increases and improved GID utilization. The segment margin increased to 10.6% from 9.1%. The APAC margin continues to grow
through greater percentage of professional services work and higher Group utilization of GID.
FY2022
FY2021
AGGREGATED REVENUE
$’M
VARIANCE %
1,710
1,672
2
(14)
CONTRIBUTION
TO GROUP
AGGREGATED
REVENUE
%
19
19
SEGMENT EBITA
VARIANCE %
19
(15)
$’M
181
152
SEGMENT
MARGIN
%
10.6
9.1
1 FY2021 prior period has been restated. Refer to note 2E in the financial statements.
61
Annual Report 2022 Sector performance
Energy
The energy sector reported aggregated revenue of $4,477 million and segment EBITA of $327 million (FY2021: aggregated revenue of
$4,394 million and segment EBITA of $299 million1). The segment margin increased to 7.3% from 6.8%. The energy sector has shown
resilience through increased margins while navigating the global political climate.
AGGREGATED REVENUE
$’M
VARIANCE %
4,477
4,394
2
(17)
CONTRIBUTION
TO GROUP
AGGREGATED
REVENUE
%
49
50
SEGMENT EBITA
VARIANCE %
9
(24)
$’M
327
299
SEGMENT
MARGIN
%
7.3
6.8
FY2022
FY20211
Chemicals
The chemicals sector reported aggregated revenue of $3,308 million and segment EBITA of $302 million (FY2021: aggregated revenue
of $3,250 million and segment EBITA of $238 million). The segment margin increased to 9.1% from 7.3%. The chemicals sector’s strong
performance is a result of returned demand, increased investment across all regions and consistent growth in sustainability.
AGGREGATED REVENUE
$’M
VARIANCE %
3,308
3,250
2
(28)
CONTRIBUTION
TO GROUP
AGGREGATED
REVENUE
%
37
37
SEGMENT EBITA
VARIANCE %
27
(47)
$’M
302
238
SEGMENT
MARGIN
%
9.1
7.3
FY2022
FY20211
Resources
The resources sector reported aggregated revenue of $1,280 million and segment EBITA of $106 million (FY2021: aggregated revenue
of $1,130 million and segment EBITA of $75 million). The segment margin increased to 8.3% from 6.6%. The resources EBITA improved
based on strong project performance in EMEA and an increase in sustainability projects during the year.
FY2022
FY2021
AGGREGATED REVENUE
$’M
VARIANCE %
1,280
1,130
13
(21)
CONTRIBUTION
TO GROUP
AGGREGATED
REVENUE
%
14
13
SEGMENT EBITA
VARIANCE %
41
(11)
$’M
106
75
SEGMENT
MARGIN
%
8.3
6.6
1 FY2021 prior period has been restated. Refer to note 2E in the financial statements.
62
WorleyOperating and Financial Review 1.2.2 Knowledge, technology and data
Our knowledge, technology and data business value driver
refers to what we know – our brand, execution methodologies,
intellectual property, data, technology, knowledge and insights –
together driving efficiency and productivity.
Our people provide expert solutions globally by
leveraging knowledge, technology and data
Supported by our standards and integrated processes,
we provide consistent and expert solutions. We have over
51,000 people to develop, analyze and deliver this.
Our distinctive capabilities
Knowledge and advisory
We’re providing expert solutions
focused on solving complex
challenges
• we create value from knowledge
gained across thousands of
engagements and projects
each year
• we provide insights across
asset lifecycle from market
and technology analysis to
early-stage project development,
asset optimization and
repurposing/remediation
• our knowledge is delivered as
software, studies and reports
to drive project delivery
Technology
We’re expanding our process
technology intellectual property
(IP) portfolio in growth sectors to
support overall business growth
• our Comprimo® business brings
more than 65 years of proven
experience and expertise in
the development, application
and management of sulfur
removal technology
• through Chemetics® we offer
technology and solutions for
sulfuric acid and other specialty
chemicals facilities
• we build, scale, invest and partner
with others in new ventures that
have the potential to transform
the way we work today
Digital and data analytics
We’re accelerating our digital
technology to create high-value
solutions and drive margin
improvement
• we provide integrated
data-centric delivery platforms
• our digital products help our
customers improve their project
and operational performance
and reduce their safety and
environmental risk
• we’re increasing productivity
through robotic process
automation
• our artificial intelligence tools
drive smart and repeatable
engineering solutions
We leverage our global knowledge, technology and data to bring value for
our customers anywhere in the world.
63
Annual Report 2022 Knowledge and advisory
We create value for our customers through our collective
knowledge, gained from thousands of engagements and
projects each year.
Advisian
Our Advisian business comprises advisors, strategists, scientists,
planners and market analysts. We leverage this knowledge
anywhere in the world through our global talent pool and
integrated data platforms.
Advisian brings differentiation through:
• breadth and depth of specialist capabilities
• global scale and seamless integration across our operations
• end to end solutions across the asset lifecycle from project
development through delivery and beyond
• credibility and incumbency in growth markets.
Through our advisory capability, we inform communities,
companies, governments and investment houses of practical
steps towards regionally specific transformation to a low-carbon
future. This year, we’ve supported our customers on:
• decarbonization roadmaps, developed for customers in
both the private and public sector to help visualize, plan and
optimize decision making to reach their sustainability goals
• first-of-a-kind technology development projects such as
1PointFive, our barrier-breaking Direct Air Capture (DAC)
collaboration with Oxy Low Carbon Ventures
• early-stage design of over 50 renewable diesel facilities
globally to enable refiners to repurpose aging refineries
to produce low-carbon fuels to meet regulatory demands,
market pressures and corporate sustainability targets
• adapting existing infrastructure to meet the growing demand
for the generation and distribution of low-carbon fuels.
We help our customers create
community value
We support our customers to make a lasting positive
social impact. We’re committed to supporting sustainable
communities and maximizing opportunities for local
participation and benefit sharing.
We’re supporting our customers in reconciliation
We enable our customers to increase local and First Nations
employment and supply chain participation. Our Environment
and Society team is working with our customers, across
government and industry, to facilitate this. In the last year,
we’ve made two key appointments to help us deliver on this:
Kyra Galante is Worley Australia’s First
Nations Participation Director. As a proud
Indigenous woman with over 20 years’
business experience, Kyra is facilitating
partnerships between Worley Australia and
Indigenous businesses to create positive
socio-economic impact. As well as this,
Kyra’s work involves providing guidance to
Worley and our customers to facilitate the
energy transition’s alignment with
Indigenous cultural values to protect land,
water and heritage.
Maxine Trennert is Worley Canada’s
Indigenous Relations Director and is taking
action on our commitment to Truth and
Reconciliation with Indigenous Peoples
(First Nations, Métis and Inuit). Maxine is a
“connector of people and interests” with
lived experience and passion for preserving
Indigenous culture. Her drive for developing
sustainable Indigenous partnerships and
protecting traditional knowledge will be
central to our reconciliation journey.
Advisian team, Perth Australia
64
WorleyOperating and Financial Review Global Integrated Delivery
Our GID team, based in India, is a central place where teams of
talented engineers help to complete hundreds of projects around
the world. Our GID teams are extensions of the ‘home office’
teams who usually oversee the project. We use a number of
tools to stay connected and offer seamless delivery between the
two locations. Our GID can also improve overall productivity and
utilization with engineers quickly moving from project to project.
Our GID operations in India are now in their 23rd year. In FY2022,
GID comprised over 4,100 people, supporting over 60 global
offices on basic engineering, FEED, detailed engineering,
overseas assignments, and enhanced work share, delivering
projects for 32 of our customers from core and growth markets.
25% of the projects came from sustainability-related work.
This model has helped deliver 52 million work hours so far and
is expected to grow. Our total headcount in India exceeds 5,900.
The rest of the team work on local delivery however the entire
team are capable of delivering GID.
~73%
Increase in GID hours, in FY2022, up from FY2021
4,100+
people in our GID across 3 different offices, representing
a 28% increase from FY2021
Joint force to drive growth
and transformation
GID’s long-standing relationship with Germany and
the Netherlands has been an incredible source of
growth and transformation for us. These offices were
one of the earliest across the globe to embrace GID
and recognize the exceptional talent and potential of
our offices in India. And for nearly two decades, they
joined hands to work on some path-breaking projects.
So, it should come as no surprise that we had an
incredible milestone to celebrate this year. Our 750-
plus team, working on Germany and the Netherlands
projects in India, achieved 1.1 million work hours in
FY2022 – a tremendous feat by any measure. And to
make this even more of a resounding success – over
50% of this came from energy transition projects.
A large part of this was also delivered using digital
tools and applications.
The leadership team from Germany and The Netherlands (GeNe) during a visit to Gigaplex, Navi Mumbai in India to meet the 750-plus GID team working on GeNe
projects and celebrate a remarkable milestone - 1.1 million work hours in FY2022 through GID.
65
Annual Report 2022 Technology
In a world of change, our need for technology is a constant. Energy systems are evolving. Options are increasing. And consumer
demands are changing. Technology is how we stay at the forefront – it’s integral to everything we do.
Our technology businesses, ventures and products help our customers turn industry challenges into solutions. We advise from
beginning to end. And we turn ideas into reality, diversifying operations so our customers can work more efficiently and adapt better
to change.
As part of our technology solutions, we deliver proprietary technology solutions through our Chemetics® and Comprimo® businesses.
These service multiple industry sectors with a global reach via lump sum price contracts. These businesses support customers
throughout all parts of the sulfur value chain.
We deliver value to our customers by identifying industry challenges,conceiving and developing new technology and delivering
tangible solutions in the form of proprietary processes, equipment and plants, which we then support for decades afterwards to
maintain optimum performance.
Our proprietary sodium chlorate electrolyzer,
which produces green hydrogen as a by-product
2501 +
specialists in the design, supply and
operation of sulfuric acid and chlorine
chemical plants
250+
Chemetics® sulfuric acid and chlorine
chemical plants installed
#11
largest global fabricator, supplier and
designer of proprietary equipment for
sulfuric acid and sodium chlorate plants
(1,000+ installations)
Chemetics®
Our Chemetics® business is the leading provider of
technology and solutions for sulfuric acid and other specialty
chemical facilities. We have a custom-built fabrication
facility, a research lab and centers of excellence in Vancouver
and Toronto.
At Chemetics®, we have developed, patented and delivered
sustainability supporting technologies, such as:
• sulfate removal systems, which reduce liquid effluents by
more than 95% at chlorine plants worldwide
• our Core-SO2
TM technology, which enables decarbonization
of fertilizer production via water electrolysis
• our CORE-FGDTM process, which reduces stack
sulfur-dioxide emissions by more than 99%, creating a
saleable product
• our CORE-DSWTM, which recovers waste heat
to produce high-quality water through low-cost
seawater desalination.
1 As at 30 June 2022.
66
WorleyOperating and Financial Review Comprimo®
Through our Comprimo® business, we develop technology
that removes sulfur from fossil fuels and recovers it as
elemental sulfur. As the largest sulfur recovery and gas-
treating technology provider, we work with refineries, gas
plants, power and chemical plants around the world to
clean up emissions. We also collaborate with industry and
environmental regulators to improve designs that enhance
energy-efficiency and reduce emissions.
At Comprimo®, we have patents, technology and know-how
to support sustainable value creation, such as:
• the largest technology portfolio that helps to reduce
sulphur emissions globally
• our CO2 know-how that supports customers into dealing
with their carbon footprint.
1001 +
global licensor in sulfur technology with
100+ dedicated gas-treating and sulfur
specialists in five countries
1,2001 +
designed and licensed gas-treating and
sulfur recovery units worldwide
>60%1
of the global existing sulfur recovery
units carry a Worley Comprimo® design
and license
Sulfur export for international markets, Vancouver Canada.
1 As at 30 June 2022.
67
Annual Report 2022 Examples of our digital capabilities
developed in FY2022 include:
• Blockchain pilot with customers: We’re piloting
blockchain technology with our customers for smart
contracts and material tracking use cases. This is an
internet-based technology that enables transparent
and instantaneous transactions that are verified and
stored on permanent public ledgers. It’s been estimated
that the market for blockchain technology in the energy
industry will grow from US$220 million in 2018 to
US$3 billion by 2025.1
• Leading green hydrogen partnership: We signed a
memorandum of understanding with ABB and IBM
to help energy companies build and operate green
hydrogen facilities at scale. The partnership aims to
reduce the levelized cost of sustainable technology by
developing an integrated, digitally enabled solution for
green hydrogen.
• Offshore wind holistic design: We've designed a
customer-centric platform with our customers that
streamlines the “Concept to Operation” lifecycle of wind
assets. It does so by ensuring that all the contributing
factors to an offshore wind farm design are considered
at the same time and performs simulations to achieve
levelized cost of energy for the customer.
Digital and data analytics
Value creation through technology,
data and digital
Strategic objectives to drive transformation include:
• elevating cyber security and data protection to strengthen
our operating model, reduce overall vulnerability and protect
our intellectual capital
• enabling data-centric delivery by leveraging information
and digital technologies to create efficiencies across the
asset lifecycle
• enhancing digital literacy and establishing digital capability
across the organization to improve the project team and
customer experience as well as Worley’s competitive position.
In FY2022, we’ve achieved:
• reduced operations cost with technology platform
standardization
• increased efficiency and reduction of manual data entry
duplication through introduction of over 90 automation bots
• increases in our information security and lower
cyber risk through world-class technology.
We continue to enhance our privacy and
data security metrics:
• the percentage of our people trained in Data Privacy
exceeds 85% of our workforce (including craft)
• SecurityScorecard rating: 92%
• Information Security Management System (ISMS)
meets the requirements of ISO27001 Information
Security Standard
• third-party independent maturity assessment against
NIST Cyber Security framework: Mature rating with a
score of 850/1000
• our Test Phishing Cyber-attack campaigns and training
reach greater than 85% of our people.
1 Global Market Insights (GMI), Blockchain in energy market, 2019.
Members of Information & Digital Delivery spent some time with ‘Spot’,
the robot dog, during a technology display in the Houston DXLab.
68
WorleyOperating and Financial Review Digital-enabled asset solutions
We help our customers design their “asset of the future” enabled
with digital infrastructure in a way that we get insights into the
operation and make it safer and cheaper.
To reduce energy costs, we’re making autonomous uncrewed
operations possible by providing our customers with five key
capabilities:
1. Advisory services and service design
2. End-to-end digital twins
3. Productization of services and breakthrough analytics
solutions
4. Sustainability technology solutions, such as WaterRide for
flood modelling
5. Autonomous solutions design and implementation.
We’ve developed subscription-based B2B (business to business)
products and services that are applicable to the entire asset
lifecycle.
We are supporting our customers within all our markets to
electrify their assets with low-carbon energy. To do that, we
have created a B2B service called “Power to Products”.
Another of the B2B services we provide is the maintenance
of digital assets. This is an example of how we productize our
IP and scale it through digital technology. We’re helping our
customers maintain digital models throughout the asset lifecycle
to enable improved decision making.
Customer Solutions team.
69
Annual Report 2022 Leading innovation across industries
This year, we again facilitated the Industry Leadership
Forum, a cross-industry sharing of best practice across
Worley’s customers. The forum celebrated its 20th year
milestone and, over those years, has tackled the issues
of the day, starting with a focus on safety and project
delivery, through to today where the issues of diversity
and inclusion, energy transition and decarbonization,
and digitalization are the topics of interest. This year’s
theme, “A tipping point for industry: Confronting
accelerating demands for change,” stimulated
discussion and collaboration across this industry
network. We had over 120 customer companies and
400 customer representatives participated in the
forum, virtually and in person, across Perth, Brisbane
and Singapore.
The continued success of this event is because
of the leadership and commitment demonstrated
by cross-industry business, seeking opportunities
to innovate, share and learn for the benefit of
the industries in which we work. It is something we
can all be proud of.” Chris Ashton, Chief Executive
Officer, Worley.
Portfolio Management
Worley’s brownfield portfolio supports the
development of deep connections with many of our
global customers’ operations. The establishment
and operation of global Portfolio Management
networks across regions and global customers is
creating a strong culture of best-practice sharing,
connection and community, enhancing the value
being delivered to our customers.
200+
brownfield portfolios globally
20+
years of continued portfolio management
for over 10 customers, including, for
example, Woodside, bp Kwinana Refinery,
Syncrude Canada, Rio Tinto Iron Ore and
various Shell Alliances
Viva project team.
70
WorleyOperating and Financial Review 1.2.3 Equipment and fabrication
Our equipment and fabrication business value driver refers to our manufactured equipment and modules for the energy, chemicals
and resources sectors, supporting delivery of critical infrastructure.
We deliver services across the entire project lifecycle. Our integrated approach to maintenance, modifications and operations reduces
risk and costs. Our construction approaches help customers to meet their objectives by including modularization, stick-built and
pre-fabrication methodologies. We manufacture bespoke pipework, metalwork, joinery and control and electrical panels through our
fabrication yards in the UK, Europe and the Americas.
Fabricating critical equipment for green fertilizer production
Chemetics® has developed a patent-pending new process, CORE-SO2
processes, using green hydrogen.
TM, that facilitates existing phosphate production
This process is attracting strong interest from the fertilizer industry and will be developed in cooperation with one of the
world’s leading fertilizer producers.
Our fabrication shop in Pickering, Canada, will play a critical role in developing and fabricating the specialized proprietary
equipment. We’re now expanding our capacity to ensure we meet future market needs.
71
Annual Report 2022 Delivering solutions for our customers in the field
Our Field Services organization delivers a full suite of
solutions for our customers in a variety of complex facilities in
greenfield and brownfield assets globally. Our services include
maintenance, modification, operations, fabrication, construction,
management, start up and commissioning. As an integrated
offering with our engineering operations or standalone, we
deliver these services to meet our customers’ needs.
Our customers’ needs at their existing facilities may span a range
from ongoing routine maintenance of a plant to large-scale plant
turnarounds, supported by nearly one thousand of our people.
When building new or expanding existing facilities, we're able to
deliver fabrication and construction crews of just a few people or
a full in-house engineering, procurement and construction (EPC)
team of hundreds.
Our Field Services team is currently supporting our customers as
they enter and progress through the energy transition. The skills
and experience we possess are well suited to energy transition
projects and help our customers to deliver these projects safely
and cost-effectively.
Increasing the diversity of our workforce
Our team has formed a partnership with Women Building
Futures to run a four-week express training program which
will focus on training women for careers as pipefitters. The
first express program will train 12 women with the intention of
hiring these program graduates as first-year apprentices. If the
program goes well, we hope to expand to other disciplines in the
future – opening even more opportunities for women to work as
craft professionals in the field.
Our safety performance at the
ExxonMobil Baytown Refinery
In February 2022, one of our largest and most diverse
operations within our Maintenance and Turnaround
portfolio for an integrated downstream customer
in Baytown, Texas, achieved 4 years with 4.7 million
safely executed work hours.
This outstanding achievement demonstrates our
commitment to the safekeeping of our people and our
customer facilities by “Walking the Walk and Talking the
Talk” when it comes to safe work practices.
ExxonMobil Baytown Refinery in Texas, USA.
72
WorleyOperating and Financial Review A spotlight on Rosenberg
Rosenberg Worley AS operates in a fully integrated engineering,
fabrication and construction environment. Designing and building
assets for offshore industries, Rosenberg has a strong focus on
new markets, including offshore floating wind, electrification,
hydrogen and sea farming.
The capacity of Rosenberg is growing, and we’re upskilling our
people with new knowledge that supports the energy transition.
Seventeen of our engineers are now completing a master’s
course in marine technology to prepare for growing investment
in offshore wind.
We’ve also taken steps to improve the environmental impact
of this site. We’ve purchased Renewable Energy Certificates
for Rosenberg, reducing our market-based emissions by
15,200 tCO2e. We’ve also introduced Shore Power, enabling
docked vessels to connect to the hydro-power generated
electricity instead of relying on diesel generators.
72
years with an apprentice program
60+
nationalities
25
new apprentices per year
2,000+
certificates of apprenticeship since 1990
4,300
people working at Rosenberg
The Prime Minister of Norway and the Minister of Industry
and his Minister of Trade, Industry and Fisheries held a
press conference at Rosenberg in June to launch their
Green Industry initiative. In their plan, they listed 100 ways
they will help Norway’s industries become greener.
(Above photo) Prime Minister of Norway, Jonas Gahr Støre (on the left) and
Norwegian Minister of Trade, Industry and Fisheries, Jan Christian Vestre (on
the right).
(Below photo) Naerings- og fiskeridepartementet (Norwegian Ministry of Trade,
Industry and Fisheries).
Iseline Nybø, former Minister of Industry (Norway), at the ribbon cutting
ceremony to launch Shore Power at Rosenberg in June 2022.
73
Annual Report 2022 Environment
1.3 ESG disclosures
In this section, we provide a review of our ESG performance through the lens
of the following business value drivers1
Environment
Social
Governance
1.3.1 Environment (page 74)
1.3.3 People (page 88)
1.3.5 Sustainability governance (page 100)
1.3.2 Taskforce on Climate-
related Financial Disclosures
(page 80)
1.3.4 Communities (page 95)
For comprehensive disclosures
on corporate governance, please refer to
the Directors’ Report (page 116) and our
Corporate Governance Statement.
Image taken by Anna Huff, Project Manager, as part of our Earth Day photo competition.
1 Our reporting boundary for our ESG disclosures extends to our owned and managed sites. We use the operational control approach to define this.
74
WorleyOperating and Financial Review 1.3.1 Environment
Our environment business value driver refers to how we consider the environment with all stakeholders, stewarding environmental
sustainability. See page 25 for how we're supporting our customers to meet their own sustainability commitments.
Our updated climate change position statement
This year, we updated our climate change position statement to reflect our increasing ambition on sustainability.
E
n
v
i
r
o
n
m
e
n
t
Climate Change
Position Statement
As the world seeks to urgently
reduce greenhouse gas emissions
to net zero, our role is clear.
We're increasing our focus on the
decarbonization of the Energy,
Chemicals and Resources sectors.
We're also making assets more
resilient to climate change.
Supporting the protection of
biodiversity. Accelerating the
deployment of technology. And
transforming the way we design,
buiId and operate assets to
ensure we're delivering a more
sustainable world.
There's a lot of work to be done
this decade. But we're not doing it
alone. Collaboration is central to
our approach.
We're working with our customers
and creating partnerships to find
solutions that enable sustainable
growth. And we're supporting our
people and communities to ensure
an inclusive transition.
Reduce our emissions to net zero:
• By 2030 for Scope 1 and Scope 2
• By 2050 for Scope 3
We will set 1.5°C science-aligned targets.
The actions
behind our words
What we're doing to
support our climate change
position statement
Forge industry-leading partnerships.
We aspire to derive 75% of our
revenue from sustainability-related
business by 2026.
Invest A$100 million over
three years to build our
sustainability competencies.
Transform our culture by providing
our people with opportunities
to learn, develop and drive
sustainable solutions with our
customers and suppliers.
Develop a plan to support
biodiversity and nature
positivity in our project work.
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Annual Report 2022 Our net-zero roadmap for Scope 1 and Scope 2 emissions
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s
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400,000
350,000
300,000
250,000
200,000
150,000
100,000
50,000
0
50%
reduction of our
carbon emissions
100%
reduction of our
carbon emissions
120,000
20202
2025
80,000
60,000
40,000
20,000
0
2030
100,000
C
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s
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(
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0
2
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Energy remaining to decarbonize
Renewable energy purchasing
Electrification1
Fuel switching
Certified carbon credits/offsets
COVID-19 pandemic impact
Total carbon emissions
Energy efficiency & digital solutions
Consolidation of office space
Short-term approach
Long-term approach
This year, our Scope 1 and Scope 2 emissions are 48,211 tCO2e;
29% lower than FY2021 levels.
Office consolidation
Energy efficiency improvements
Hybrid and electric vehicles pilot program
Our FY2022 target has, in part, been achieved through lower
office occupancy rates than expected. But it is largely due to
renewable energy switching and energy efficiency measures. We
purchased certified renewable energy for our offices in India, the
United Kingdom, Malaysia and Canada, and for our Rosenberg
fabrication yard in Norway. This reduced our Scope 2 emissions
by 17,200 tCO2e. We also improved the efficiency of our lights
Phase out diesel generators
and generators across Asia and Africa, which reduced our
emissions by 360 tCO2e.
Transition to renewable electricity
Transition to biofuels
In the short term (2022-2025), we are progressing towards
our net-zero target, using widespread renewable energy
procurement, office consolidation and energy efficiency
initiatives. We are also electrifying our vehicle fleet where
viable. In the longer term (2025-2030), we will focus on the
decarbonization of our vehicle fleet globally and phasing out
natural gas for heating where possible.
Achieving our net-zero Scope 1 and Scope 2 target has several
uncertainties, including:
• ability to procure renewable energy in the jurisdictions
we operate in
• accessibility of zero-emission vehicles and charging/
fueling stations
• ability to source zero-emission heating in very cold climates.
We are managing these uncertainties by closely monitoring
Phasing out gas in buildings
and choosing fully renewable energy procurement options,
fully electrified buildings and electric vehicles in the
Widespread adoption of electric vehicles and biofuels
countries we operate in. Where available, we work closely
with local teams to implement these initiatives. We expect
Continuing to transition to renewable energy
that sourcing these options will become more accessible
Piloting emerging technologies for heavy vehicles
as we get closer to 2030, however, it is likely we will not be
able to remove all of our Scope 1 and Scope 2 emissions.
Certified carbon offsets where required
For these residual emissions, we will compensate by using high-
quality carbon credits to achieve net zero.
Scope 1
emissions (tCO2e)
Scope 2
emissions (tCO2e)
Total
Scope 1 + Scope 2
emissions (tCO2e)
FY2022
FY2021
% reduction
22,238
25,555
13%
25,973
42,268
39%
48,211
67,823
29%
A detailed breakdown of our Scope 1 and Scope 2 emissions is
disclosed in our ESG data center.
1 Combined with renewable energy.
2 Our FY2020 energy and emissions were also impacted by the COVID-19 pandemic, but this has not been quantified as this was our baseline emissions year.
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Our energy use
In FY2021, we joined the Climate Group and committed to:
• improve our energy productivity by 25% by 2030 from a
2020 baseline ($30.4 million/GWh)
• implement an energy management system across our
business by 2022.
FY2022
FY2021
% change
Energy productivity
($ million/GWh)
42.7
38.1
Total energy use (MWh)
212,345
230,029
12%
increase
8%
decrease
Assurance of our energy and emissions
We have implemented an energy management system, covering
all our offices, fabrication yards and vehicles. This has given
us better visibility of multiple environmental metrics including
energy, greenhouse gas emissions, water and waste. We’ve
been able to better assess which locations have high-impact
opportunities and more effectively implement initiatives to
reduce emissions.
This meant that in FY2021, we were able to achieve limited
assurance of our Scope 1 and Scope 2 emissions for the
first time.
New Zealand electric vehicle.
Our Scope 3 emissions
In FY2021, we committed to reach net-zero Scope 3 emissions
by 2050. We have previously reported Scope 3 emissions from
air travel and selected categories of Purchased Goods & Services
only. This year we have expanded our Scope 3 reporting to
include 11 out of the 13 applicable Scope 3 categories to Worley,
as defined in the Greenhouse Gas Protocol.
Our FY2022 Scope 3 emissions are estimated to be
585,850 tCO2e. A detailed breakdown of our Scope 3
emissions is disclosed in our ESG data center.
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The majority of these emissions are in Category 1: Purchased
Goods & Services. We recognise the challenge and complexity of
quantifying and reducing Scope 3 emissions. We will continue to
improve the quality of our Scope 3 data, and we are developing a
plan to reach our 2050 net-zero target.
Evolving toward nature-positivity
Our relationship with nature is complex. We depend on a range
of ecosystem services to function, as do our customers. At the
same time, our actions have both positive and negative impacts
on the state of the environment. Traditionally, the environmental
impact of a project has focused on compliance rather than on the
value of the ecosystem services it depends upon.
In our revised Climate Change Position Statement, we
introduced a strategic action to develop a plan to support
biodiversity and nature-positivity in our project work. This
is in response to growing global concern about the state of
nature and society’s ongoing impacts.
Defining ‘nature positive’
There is much work happening internationally to define
what 'nature positive' means and how it is measured.
We expect greater clarity over the coming year via
the Global Biodiversity Framework agreement at the
15th Conference of the Parties to the Convention on
Biological Diversity (COP15) and through the ongoing
development of the TNFD (Taskforce on Nature-related
Financial Disclosures).
Our health, safety and well-being management system
helps us manage environmental-related risks in the way
we deliver projects. Parts of our business hold ISO 14001
certification and we conduct third-party audits of our
management system and metrics. We do not hold certification
within all jurisdictions due to customer, contractual and
operational needs.
The management system includes our SEAL process; our
framework for driving sustainability in engineering design.
We have had no incidents of non-compliance with environmental
permits, standards and regulations.
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Annual Report 2022 Our water and waste
The way we use water and produce waste is one of our material
impacts on nature. Our fabrication yards in Canada, Norway, USA
and UK are our most significant locations when it comes to water
use and waste generation. This is because these are industrial
facilities, and we control operations there.
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Last year, we disclosed the water and waste from our fabrication
yards. This year, we’re expanding our disclosures to include all
locations, including offices1.
Waste generated (tonnes)
Landfill
Waste-to-
energy
Recycling
Water usage
(m3)
Fabrication
yards
Hazardous
waste
Non-
hazardous
waste
–
5,419
Offices
3,051
652
859
344
–
4,645
759
429,829
We’ve been working to reduce the waste from our Rosenberg
fabrication facility by strengthening segregation of waste
streams so they may be recycled. We now recycle eight different
types of waste.
We’ve also been reducing our waste in our offices and showing
our people how to recycle correctly.
Understanding and managing our impact on water
availability
How we manage our water varies across our operations and
locations. Considering this complexity, it’s important that we
prioritize and manage our water use, based on material impact.
We mapped our locations using World Resource Institute's
Aqueduct global water risk tool to understand our impact on
water stress. In FY2022, we consumed 134 ML of fresh water in
regions with high or extremely high baseline water stress1.
Worley baseline water stress profile (% of operations)
Extremely High
High
18%
15%
Low - Medium
13%
17%
Medium - High
We’re now using this analysis to target specific locations
and make our water use more efficient.
5,419
1,511
4,645
162,149
Low
37%
Rosenberg fabrication yards.
1
For sites where data has not been available, waste generated and water usage has been estimated using the World Bank database and our occupancy data. A significant
proportion of our water usage is estimated based on headcount. This means that our reported figures are quite conservative as, during FY2022, many of our people
continued to work from home. See our ESG data center for more information.
78
WorleyOperating and Financial Review “ We commit to phase out the use of single-use plastics at our owned
and managed sites by the end of FY2025”.1
This year, we’ve reviewed our use of single-use plastics and will seek to phase out the use of single-use plastics by the end of
FY2025. We will start by building awareness of alternatives to plastics and measure our impact.
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Being accountable for our emissions at COP26
Our participation in COP26 resulted in greenhouse gas emissions from business travel and the energy used at our leaders'
roundtable event.
We've partnered with South Pole to compensate for these emissions by supporting climate action projects through their EcoAustralia
offering. We combined emissions reductions from international Gold Standard renewable energy projects with biodiversity
conservation from the Mount Sandy Conservation project, located in South Australia. Mount Sandy is located on the traditional lands
of the Ngarrindjeri people, Traditional Custodians of the Coorong, and is a rare pocket of intact native vegetation in the region. Our
investment contributes to the protection of this biodiversity-rich land in partnership with its Traditional Owners. The project also
provides employment for the local community in the form of vegetation monitoring, fencing and pest and weed control.
From FY2023, we will be offsetting all corporate travel emissions.
EcoAustralia: Mount Sandy Conservation Project (image provided by South Pole).
1 Locations where single-use plastic bottles are necessary for the consumption of safe drinking water are excluded.
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1.3.2 Taskforce on climate-related
financial disclosures
Governance
We embed climate-related risk and opportunity within our
governance and management processes. We have roles within
the Board and senior management that are responsible for our
response to climate change.
Board oversight
The Board’s oversight of company-wide climate-related risks
and opportunities is held by the Health, Safety and Sustainability
Committee (HSSC). This includes governance of our Climate
Change Position Statement (CCPS). We table climate-related
agenda items at the Board HSSC meetings every two months.
These include progress towards our net-zero commitments,
updates to disclosures and the management of risks
and opportunities.
The Board Audit and Risk Committee (ARC) and Transformation
Committee also monitor climate-related risks and opportunities.
The ARC makes recommendations on the overarching
strategy because physical and transition climate-related risks
relate to the broader spectrum of enterprise risk. The Board
Transformation Committee has oversight of the overall business
transformation in response to managing transition risk.
The Chair of the Board is a member of the HSSC and the ARC.
They are well informed of our progress toward reducing our
emissions in accordance with our objective as a member of the
Business Ambition for 1.5°C.
The role of management
The Executive Group Director Sustainability, reporting directly
to the CEO, is responsible for climate-related strategy and
disclosures. This includes fulfilling the commitments of our
CCPS, including our net-zero commitments, and supporting our
purpose of delivering a more sustainable world. Also reporting
to the CEO is the Executive Group Director Transformation,
who is responsible for the program of change within the Worley
business to fulfill our purpose and ambition.
Shareholders
Board
Health, Safety and
Sustainability Committee
Audit and Risk Committee
Transformation Strategy Committee
Chief Executive Officer
Executive Group
Chief Financial Officer
Group Executive –
Growth
Group Executive –
Sustainability
Group Executive –
Transformation
Business Leaders
Director – Enterprise
Risk
Director – Strategy
Director – Sustainability
Performance
Director – Sustainability
and Energy Transition
Director – Transformation
Sustainability Working Group
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WorleyOperating and Financial Review Reporting to the Executive Group Director Sustainability is the
Director – Sustainability Performance. This role is responsible
for delivering the strategic actions under the CCPS, embedding
our climate change response into our policies and procedures
and designing and delivering programs of work to drive the
engagement of our people.
Also reporting to the Executive Group Director Sustainability is
the Director Sustainability and Energy Transition Leadership.
This role is responsible for forging and coordinating our
involvement in industry partnerships and collaborations and
fostering and leading sustainability/energy transition thought
leadership and supports our engagement with customers on
these issues.
The Sustainability Working Group (SWG) develops responses to
climate change, energy transition and other sustainability issues.
The group meets monthly and includes representatives from
across all areas of the business including Operations, Growth,
People and Information & Digital Delivery.
Our Director of Strategy sits within our Growth team and is
focused on opportunities in our sectors associated with the
low-carbon transition. Working together, these teams grow the
business opportunities in decarbonization and energy transition.
Our Director of Enterprise Risk plays a key role in overseeing the
incorporation of climate-related risk and opportunity into our
enterprise risk and company-wide risk processes.
Our Assurance team, which includes our R3 team, works with the
business to manage the physical risks (and opportunities where
relevant) of climate change. This includes managing the safety
of our people and communities during extreme weather events.
They also plan for physical climate change scenarios.
Strategy
We assess climate-related risks and opportunities and embed
these in our Company strategy. Mitigating the effects of climate
change and transitioning to a low-carbon economy is key to our
Company purpose: delivering a more sustainable world. So is
building climate-resilient industrial infrastructure.
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Short Term
(0 to 2 years)
Our short-term horizon is focused
on the immediate budgeting period.
Medium Term
(2 to 5 years)
Our medium-term horizon is focused
on our strategic business plan in line
with our ambition.
Long Term
(5 to 10 years)
Our long-term horizon is focused on
global trends and our net-zero aspirations
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Annual Report 2022 Our risks and opportunities
We identify and manage climate-related risks and opportunities over the short, medium and long term.
Key: S = Short term M = Medium term L = Long term
Transition
We classify our climate-related transition risks and opportunities as they relate to:
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Policy and
Regulation
S M
Technology
M L
While global governments made significant additional net-zero commitments in the lead-up to COP26, the
uncertainty in policy and regulation remains high. We operate in regions of the world where regulation exists,
such as the UK and Europe. This regulation is well-matched with our Company strategy, the assistance we’re
providing to our customers and our own net-zero commitments. We monitor emerging regulation around the
world closely. Our global presence and experience in regions with more-progressive climate-related policies
allows us to prepare for changes in other parts of the world.
The shift to a low carbon energy system is going to require deployment of new and different technologies
than those that dominate the current energy system.
Worley is a deliverer of energy infrastructure with a heritage in legacy fossil-fuel based generation
systems, and therefore there is a risk that we don’t develop the necessary skills and culture to deliver the
technologies of the future. However, we also have considerable experience delivering low carbon energy
projects such as hydrogen, renewable energy generation, and energy storage, and have delivered more than
3,300 such projects.
Worley is managing the risk and opportunity of shifting technology by creating focused teams that are
targeting the new market opportunities, as well as elevating focus on organizational culture and skills
development programs.
Market
S M L
The energy, chemicals and resources sectors we serve are responsible for over 75% of the world’s annual
greenhouse gas emissions. We are focused on supporting our customers in the decarbonization of these
sectors. We continually assess the markets we serve and the impact on our strategy in the short, medium
and long term.
Global energy supply and demand continues to fluctuate. While sustained high oil prices are tempering
demand growth in advanced economies, the end of broad COVID-19 lockdowns in China is expected to more
than offset this. The situation in Ukraine has added near-term challenge to energy markets with shortages in
energy supply having the potential to cause a short-term increase in the carbon intensity of energy use.
We manage reputational risk through our RBA Standard. This includes assessing the carbon intensity
of project opportunities.
Reputation
S M
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WorleyOperating and Financial Review Physical
We class our climate-related transition risks and opportunities as Acute and Chronic.
Acute
S M
Chronic
M L
We are beginning to witness the direct impact of acute climate change on our business and our people.
The 2022 Australian floods across the states of Queensland and New South Wales resulted in the temporary
closure of our Brisbane office, and a number of our people were affected by personal property damage.
Similarly, in 2021, our people in Canada experienced historic temperatures, as high as 45°C, which caused
school closures and wildfires in surrounding areas.
We continue to support our business and our people during extreme weather events through our global
R3 Group. We are planning for more extreme weather events and the support that will be required.
As the world continues to warm, the importance of climate-resilient design intensifies. We see the
opportunity, now, to incorporate climate resilience into the ways we design and construct. We are
continuously evolving our central design process, SEAL, to establish sustainable thinking in all that we do.
Asset sustainability forms a part of our definition for sustainability related work (see page 27).
There’s also risk associated with supply chain disruption caused by weather pattern changes and the
increasing frequency of extreme weather events. Supply chain disruption has the potential to delay
delivery of much-needed infrastructure. We are exploring new ways to work with our supply chains to
reduce this risk.
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Solar panels installed on our office in Johannesburg, South Africa.
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Annual Report 2022 Impacts on our business
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Climate-related risks and opportunities have impacted our role in the world and the way we run our business. These include reducing
the carbon intensity of the portfolio of projects we deliver for our customers over time as well as the carbon intensity of our
own business.
Over the past two years, we’ve transformed our business to align with our purpose. Our response to climate change has been
fundamental in informing our strategy. Our ambition, by 2026, is to be recognized globally as the leader in sustainability solutions.
This includes partnering with our customers to decarbonize the energy, chemicals and resources sectors. But we also recognize that,
with the world already at 1.1°C of warming1, climate-resilient development will be critical. We’re embedding sustainability thinking into
our engineering and construction systems.
We’re also transitioning our business to be net zero for our Scope 1 and Scope 2 emissions by 2030 and our Scope 3 emissions by
2050. This year, we’ve made progress in reducing our Scope 1 and Scope 2 emissions through switching our offices to renewable
energy and updating a portion of our vehicle fleet to hybrid vehicles and biofuels. We’ve reduced our emissions by 29% against
our FY2021 baseline.
We’re seeing the positive impact of our purpose on our people’s engagement. We’re providing them with opportunities on energy
transition projects alongside development through learning passports and e-learning platforms.
Our strategy and scenario planning
We use climate-related scenarios as key inputs to our strategy planning. We use these scenarios to approximate the speed of the
energy transition and the degree of adaptation required to make existing and future infrastructure resilient to climatic changes.
Global
Temperature
Rise
3°C
Input Scenarios
Outputs
International Energy
Agency (IEA)
Stated Policies Scenario
(STEPS)
IPCC AR6 C6
Scenario Definition
STEPS is a scenario which reflects current policy settings, based on a sector-by-
sector assessment of the specific policies that are in place as well as those that have
been announced by governments around the world.
Conventional Energy
Oil demand will eventually level off in mid-2030 and then plateau towards 2050.
Low-carbon Energy
• Gas demand grows rapidly through to 2030, and growth tempers slightly through
to 2050.
• Renewable energy supply continues to grow, just not at a rate sufficient to remain
below 2oC.
Chemicals and Fuels
• Chemicals: Oil use in petrochemicals increases moderately, and plastic recovery
continues to grow at an increasing rate through 2030.
• Fuels: Renewable fuel supply increases, however, it is only at about half the rate
of the Announced Pledges Scenario (APS) and a third of the rate of the Net-Zero
Emissions scenario (NZE).
Resources
Overall requirements for critical minerals needed for clean energy technologies grows
through to 2050, however, it is still only about one third of NZE requirements.
1 Reference: IPCC Sixth Assessment Report.
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WorleyOperating and Financial Review Global
Temperature
Rise
2°C
Input Scenarios
Outputs
IEA Announced Pledges
Scenario (APS)
IPCC AR6 C3
Scenario Definition
APS is a scenario which assumes that all climate commitments made by governments
around the world, including Nationally Determined Contributions (NDCs) and longer-
term net-zero targets, will be met in full and on time.
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Conventional Energy
Oil demand is expected to peak near 2030 and gradually decline by 2050.
Low-carbon Energy
• Gas demand reaches a peak near 2030 and then declines slightly towards 2050.
• Renewable energy supply continues to grow, just not at a rate sufficient to attain
1.5°C.
Chemicals and Fuels
• Chemicals: Demand rises substantially by 2030.
• Fuels: Renewable fuel demand increases towards 2030 at about half the rate of
NZE.
Resources
Overall requirements for critical minerals needed for clean energy technologies grows
significantly through to 2050 (faster growth than STEPS).
1.5°C
IEA Net-Zero Emissions
by 2050 (NZE)
IPCC AR6 C1
Scenario Definition
NZE is a scenario which sets out a narrow but achievable pathway for the global
energy sector to achieve net-zero CO2 emissions by 2050. It doesn’t rely on emissions
reductions from outside the energy sector to achieve its goals.
Conventional Energy
Oil demand is expected to decline during this decade with accelerated decline between
2030 and 2050.
Low-carbon Energy
• Gas: Supply drop doesn’t occur until around 2030. By 2050, more than half of
natural gas consumed is used to produce low-carbon hydrogen, and a higher
percentage of gas use is in facilities equipped with CCUS.
• Renewable energy supply continues to grow and significantly exceeds APS and
STEPS growth.
Chemicals and Fuels
• Chemicals: Demand continues strongly in this scenario, underscoring the need for
measures to reduce the energy and CO2 emissions intensity of production.
• Fuels: Biofuel demand is expected to expand significantly to align with this scenario.
Liquid biofuels expand in this scenario primarily to reduce emissions in road
transport and to a lesser extent for planes and ships.
Resources
Achieving net-zero emissions globally by 2050 means record levels of clean energy
deployment and requires up to six times more mineral inputs in 2050 than today.
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Risk and opportunity management process
For details of how we manage all risks and opportunities, refer to page 104. Our risk management process includes a range of
assessments, surveillance and reporting. Our Risk Management Standard sets our overarching approach across all processes
within the Company. The Standard applies to all of our activities including opportunity pursuit during project delivery and corporate
functions, such as legal and treasury.
We use a risk matrix approach with likelihood and consequence criteria that’s relevant to our business and covers a range of risk
types. Our risk matrix helps us to assess environmental impacts including climate change.
Identifying climate-related risks and opportunities
We’ve embedded identifying climate-related risks into our business risk processes and tools.
Responsible Business
Assessment (RBA) Standard
Special Risks Standard
Annual transition and physical
risk workshops
Within our RBA Standard, we identify the carbon intensity of opportunities and flag
high-carbon emissions as a special risk for Senior Leadership approval via the Special
Risks Standard.
Provides the level of approval required for high risks that could damage our reputation or
financial profile. High risks from our RBA Standard, including carbon intensity, are detailed in
the Special Risks Standard.
We complete annual assessments to identify the risks and opportunities associated with
climate change. We use IEA (STEPS, APS and NZE) and IPCC (SSP 5-8.5) scenarios as the
basis of these workshops. Our Sustainability Performance team, in collaboration with key
stakeholders across the Worley business, manage the outcomes of these workshops.
Managing climate-related risks and opportunities
We manage identified climate-related risks and opportunities through various groups and processes within the business.
Sustainability performance,
strategy and enterprise risk
Our Sustainability Performance team, in conjunction with our Strategy and Enterprise Risk
team, oversee climate-related risks and opportunities. These teams work together to embed
change throughout the organization.
Our business strategy is informed by being a leader in designing and building the low-carbon
infrastructure critical to reducing global emissions.
Our Project Delivery team have oversight of risk management across all of our projects, which
include climate-related risks and opportunities. Our Internal Audit and Assurance team is
responsible for ensuring our project risk management processes are upheld.
R3 manages our security and resilience management processes including response plans for
climate-related changes to weather patterns and increased frequency of extreme weather
events.
Our people strategy is informed by the risk of an experience shortage. We give our people
opportunities to build on their experience to design and deliver low-carbon infrastructure
through project delivery and training.
Through our commitment to be net zero on our Scope 3 emissions by 2050, we’re turning our
minds to the emissions in our supply chain. This year, we’ve disclosed additional Scope 3 data
for 11 categories of the GHG Protocol. Through our Supply Chain Code of Conduct, we are
committed to partnering with suppliers aligned with our values.
We also consider the physical risk of climate change in our supply chain planning and the
impacts of extreme weather events on project schedules.
Project delivery and
assurance
R3
People
Supply chain
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WorleyOperating and Financial Review Metrics and targets
We use a range of metrics to measure our progress on
addressing climate-related risks and opportunities.
Through our ambition, we have the following targets.
These are centered around our role in the world and the
way we run our business.
Our own Scope 1, 2 and 3 emissions
We're committed to net-zero and are making progress against
our net-zero roadmap. See page 76 for more information.
We have had limited third-party assurance completed over our
Scope 1 and Scope 2 emissions and energy usage data.
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Scope 3
• We will accelerate our growth and aspire to derive 75% of
our revenue from sustainability related work (see page 21).
• We will partner with customers who are committed to driving
sustainability; together we will decarbonize value chains and
steward resources (see page 21).
We have increased our Scope 3 disclosures from two categories
in FY2021 to 11 out of the 13 applicable Scope 3 categories to
Worley, as defined in the Greenhouse Gas Protocol.
See our ESG data center for more information.
• We are committed to our own sustainability – reaching
Incentivizing our leadership
net-zero Scope 1 and Scope 2 emissions by 2030 and Scope 3
by 2050 (see page 21).
• We are committed to improving our energy productivity1
by 25% by 2030 from our baseline energy productivity in
2020 of $30.4 million/GWh (see page 77).
This year, our revenue from sustainability related work has
increased to 35% and the factored sales pipeline for sustainability
related work is 56%. See page 27 for how we define this.
The Short-Term Incentive (STI) plan now has a greater focus
on ESG priorities as part of its framework. The plan applies
to approximately 1,000 Senior Leaders across Worley, and
now includes a measure to reduce Scope 1 and Scope 2
carbon emissions in line with our Scope 1 and Scope 2 net-
zero roadmap.
1 Our energy productivity is measured by: Aggregated revenue ($m)/Total energy usage (GWh).
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1.3.3 People
Our people business value driver refers to how we support
and include our global team to safeguard and enhance their
well-being, helping them to drive sustainable impact.
Life is one of our values and we provide programs and
management systems to support and embed it. Life
is underpinned by human performance. This is about
understanding and improving how we interact with plant,
processes and each other to create a safe environment.
These building blocks help us respond to our ever-changing
professional environment and make ‘learning’ the focus.
We do this to make sure we’re working in a safe manner
in our day-to-day operations.
We’re strengthening our networks to build an inclusive
and psychosocially safe workplace.
Our people are at the core of Worley. Their safety, health
and well-being are paramount.” Chris Ashton, CEO, Worley
This is why over the past year we’ve:
• further embedded our Life matters program, raising
awareness of the importance of mental, social and
physical well-being
• shifted to a global Employee Assistance Program (EAP)
provider to give better support to our people and their families
• established Safe Start to kick-off 2022 after the holiday break
to reinforce various behaviors and programs that support Life
• acted on over 80 suggestions from our people, directly
strengthening HSE and quality outcomes.
In May, we held Safety Week, where we addressed themes of
psychological safety, human performance and safety in design.
We also prioritized the importance of connecting with our people
in the field, providing them with the tools and equipment they
need to operate safely. We placed a strong focus on psychosocial
health during this week.
Recognizing our value, Life, in our project delivery
Many of the projects we execute for our customers involve
significant risks, with the potential for personnel illness and
injury, environmental impact and property damage.
We implement controls and lessons learned from previous
projects to mitigate major hazards. These include stop-work
authority, safety timeouts, daily safety briefs and weekly
management meetings to discuss hazards, events and controls.
This helps us establish a ‘culture of care’, enabling strong safety
performance.
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Human performance is gaining
traction in industry
We’ve seen an increasing number of customers and
industry partners, such as the International Association
of Oil & Gas Producers, explore human performance.
In October 2021, we presented on this topic at the
Chevron, ExxonMobil and bp project supplier safety
leadership forum. The discussion focused on the
importance and value of empowering our people,
building trust and the benefits of sharing learnings
for improvement.
There was great conversation about the role leadership
plays in fostering human performance and how to
create a ‘learn and improve’ organizational culture.
Our leadership principles have been key in unlocking
this culture (see page 92).
Image taken by Anna Huff, Project Manager,
as part of our Earth Day photo competition.
WorleyOperating and Financial Review Our Life approach includes a
comprehensive safety, health and
well-being management system
Our people do their work in a variety of different environments.
These include:
• our managed sites, including offices
• customer and joint-venture managed sites
• remote working
• working from home
• virtual operations
• global delivery.
This means that our people often operate under different
management systems.
The Worley management system is certified to ISO 9001.
In addition, parts of our business hold ISO 45001 and
ISO 14001 certification. We conduct third-party audits
of our management systems and metrics.
Our workplace
environment and society
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Our workplace activities
Our partnerships
Our people
Governance an d c u l
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We have a set of minimum standards that all management systems must meet
Our people
Individual / wellness
• HSS communication and
consultation
• HSS competency and training
• HSS observation and
conversation
• HSS excellence recognition
program
• Fitness to work
• Fatigue management
• Alcohol and drugs misuse
• Lone and remote workers
• First aid and medical facilities
• Injury-illness management and
rehabilitation
• Mental health
• Bullying and harassment
Our partnerships
Contractors /suppliers /
customers / joint ventures
• Prequalification and bid
evaluation
• HSS alignment and planning
• HSS readiness
• Contractor and supplier
management
• Management of change
• Field site establishment and
• Visitors to company and
non-company sites
preparation
• Hand and power tools
• Supplier Code of Conduct
• Lifting and rigging
Our workplace
activities
• Life-saving rules
• Take5 for safety
• Safe driving for Life essentials
• Life matters well-being
• Life conversations
• HSS field readiness and
construction
• Job hazard analysis
• Process and design safety
• Quality control
• Abrasive blasting, spray
painting and powder coating
• Confined space
• Mobile plant and equipment
• Piling and drilling
• Pipelines and pressurized
equipment
• Transport
• Site and office facilities
• Water working in and over
• Working at heights
Our workplace
environment
and society
• Stakeholder engagement and
consultation
• Community volunteering via
Worley Foundation
• Control of work and permitting
• Ergonomics (field and office)
• Cutting, welding and hot work
• Health risk and
• Dangerous and hazardous
substances
impact assessment
• Health workplace exposure
• Demolition and decommission
• Life programs extend to home
• Electrical
• Excavation and earthworks
safety practices
• Emergency management
and security
• Health, communicable disease
including malaria control and
blood-borne pathogens
Governance and culture
• HSS committees
• Delegations, roles and
responsibilities
• Policies and standards
• Strategy and improvement
• Digital tools and technology
• HSS regulatory and other
requirements
• HSS event reporting and
investigation
• HSS alerts
• Lessons learned
• Business continuity
• Management and knowledge
system
• Assurance system
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Annual Report 2022 We’ve maintained strong physical safety
performance in FY2022
We align our reporting with the US Occupational Safety
and Health Administration. This includes:
• Total Recordable Case Frequency Rate (TRCFR)
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We’re ‘walking the talk’ on well-being
Our Life matters program has been a key focus in the field and
the office this year. We've embedded our well-being priorities
in the work we do every day. For example, we have:
• modified our toolbox talks to include prompts that consider
• Lost Workday Case Frequency Rate (LWCFR)
human factors
• Serious Case Frequency Rate (SCFR)
INDICATORS
TRCFR
LWCFR
SCFR
FY2022
FY2021
0.16
0.04
0.06
0.16
0.02
0.07
• embedded our Health, Risk and Impact Assessment Standard
to help us identify psychosocial risks and hazards in the
workplace
• updated our Flexible Work Standard to promote an
inclusive workplace
• expanded our Injury and Rehabilitation Standard to consider
We have had no work-related fatalities in the past year. This
year an acid release occurred at a customer site. This resulted
in 11 of our people receiving medical treatment due to chemical
exposure. Worley did not have direct control of safety measures
at the site.
We’re broadening the metrics that we measure and report on,
not just looking at lagging metrics but a combination of both
leading and lagging indicators. This is part of a conversation to
look at what other data is available that will help us improve
our safety, health and well-being and be more proactive about
managing risks.
This year, we’ve increased focus on how our leaders respond.
When leaders listen and learn, people tend to be more open.
This, in turn, builds a foundation of trust. Our remuneration
framework encourages our leaders to behave in line with
Worley's values (see page 20).
Leadership activities are mutually beneficial to our leaders
and our people, strengthening our safety culture. Leadership
activities include site visits (virtual and in person). These provide
the opportunity for connection and inclusion. They help us learn
from what goes right and explore what we could do differently.
And, as a result, we can celebrate brilliant work and enhance our
ability to deliver in a safe and sustainable way.
psychological events.
In addition:
• Our Mental Health Network continues to flourish. This is a
global network of over 300 mental health champions that
connect regularly to support our people
• With remote working putting increased pressure on our
managers, we've offered mental health resources plus
a training series to all our managers globally.
Business resilience and continuity
We continue to support our people through uncertainty and
business disruption.
Our business continues to face a range of external disruptors,
including the COVID-19 pandemic, extreme climate events and
geopolitical conflict. These have the potential to impact the
well-being of our people and stop us from meeting our strategic
objectives. Our R3 (Ready, Response and Recovery) system
helps us to maintain business continuity in the face of disruption.
Over the past year, we’ve faced up to challenging events and
put our people first, including:
• the Russian invasion of Ukraine and associated impacts
on our people and business
• the continuing impacts, both medical and business-related,
of the COVID-19 pandemic
• civil unrest in Kazakhstan during early 2022.
We’re continually building our response capacity to external
disruption. This year, we established a dedicated intelligence
function to enhance our geopolitical insight and enhanced
our risk management focus in cyber security. We provide
crises exercises and incident management training for our
response and recovery teams to ensure we are prepared
to address any incidents arising.
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WorleyOperating and Financial Review People development
Our purpose and ambition are at the heart of
transforming our Company
Our workforce is transforming too. The way we work, our
capabilities and skills, the problems we need to solve, the way
we learn, the way we work together and the way we lead.
Our People pillar comes first in the ambition, and this is for a good
reason. Our people are key to delivering our transformation and
achieving our purpose, and we’re investing in them to realize this.
Attraction and retention remain strong and are a continuous
focus areas for management in this environment. The
diversification of our approach to talent acquisition is proving
effective in securing the capabilities needed across the majority
of the business. Our purpose and ambition are attractive in
the market, resulting in some strong talent joining Worley.
Management remain focused on specific populations, however,
particularly those that drive growth in sustainability and areas
most at risk from labor shortages and wages growth.
We remain guided by our key principles and focus areas of
strengthening our story, leadership capability, effective talent
acquisition, competitive reward and people experience. The
context remains dynamic, and this market volatility presents
both challenge and significant opportunity. Our response,
therefore, varies by location and skill area, and we remain very
focused on areas of most challenge.
We've sharpened our strategy in two key areas to energize and
encourage people to make a sustainable impact: making sure
we have the right people and ensuring we are building the right
experience for our people.
The right people
We want to build the right environment to both attract and retain
critical capabilities at scale.
Our purpose and ambition are encouraging more people to
choose to build their careers with Worley. We are re-skilling
to make sure we bring our people with us as we transition.
And we’re mobilising our talent in new ways to strengthen
retention, unlock innovation and scale our business.
Diversifying our approach and focusing on capabilities that drive
sustainability are proving effective ways to secure the right
talent. Increased use of technology and virtual tools, like digital
career fairs, help us to secure talent in a timely manner and
broaden our reach into the market.
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Our planned withdrawal from Russia
We responded quickly and decisively to the Russia
invasion of Ukraine.
Consistent with our purpose and values, we continue
to prioritise the safety, health and well-being of our
people, including approximately 300 of our people in
Russia. We’ve been successful in supporting our eight
people in Ukraine and their families, including support
to exit the country when appropriate, legal and safe.
We‘ve also provided support through the inbound
provisions of medical, clothing and other life sustaining
supplies, thanks to both corporate support and the
tireless efforts of our volunteering employees.
We’re currently executing the safe withdrawal of
our services from Russia and will not enter into new
contracts with Russia controlled entities. We remain
diligent as we comply with all applicable sanctions
regimes in relation to Russia. We’re constantly
refreshing our due diligence on entities and individuals
we are dealing with, including in our supply chain. The
situation for our people, projects and business interests
impacted by this event remains volatile and uncertain.
Our response has been facilitated through our global
R3 (Ready, Response and Recovery) crisis response
team and system. The R3 team continues to monitor,
analyse and drive necessary action across multiple
business and stakeholder streams including: people;
legal and sanctions; finance and banking; projects
and operations; customers and strategy; and
communications.
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The right experience
Giving our people the right experience is critical to our strategy.
And it enhances our people’s contribution by making them feel
safe, included, active and empowered.
At the heart of this are our values and behaviors. They act as a
guide for how to create the right environment. We embed them
into our processes, and they form part of the performance and
reward considerations for our leaders. Our values and behaviors
are also anchored in leadership programs and development
opportunities. They reflect the culture we’re building through
inclusive leadership and talent practices.
We're also building a culture of recognition and celebrating the
achievements of our people. We are trialling a digital platform
that coaches our leaders and people through ‘nudges’. These
nudges are micro moments that trigger action and build habits
that align with our values and behaviors.
In FY2022, we took our first step by piloting Appreciate, our peer-
to-peer values recognition program, in five countries. Our people
and leaders really engaged with the program, with one in five
people nominated for an award. Based on the learnings from our
pilot, we’ll launch Appreciate globally in FY2023. We’ll support
it with a best-in-class digital solution to help our people create
meaningful recognition moments that matter. Appreciate will be
one program, accessible to all, letting them unlock brilliance and
share stories that motivate performance.
Attraction and retention
Our shared habits of inclusion and coaching underpin these
three principles. Our next steps and the foundational tools
and programs will start with these two habits.
Everyday learning which is flexible and accessible,
fostering innovation to keep us future fit
The Growth Faculty helps organisations build more effective
workplaces by connecting established and aspiring business
leaders to the world’s brightest minds, business-critical topics
and proven frameworks and tools. During 2022, over 250 leaders
took part in the Growth Faculty.
They were inspired by prominent thought leaders on topics
such as Building High Performance Teams, Smart Growth
and Why Simple Wins.
Our Learning Passports strengthen our people’s awareness
of our key business priorities. This year, we’ve introduced new
passports, including our Energy Transition passport, with 7,000+
people taking part. Our ambition learning program was also
launched, upskilling our people in key growth areas such as
low-carbon hydrogen, offshore wind and CCUS.
‘Learning At Worley’ continues to be one of our most visited
internal sites, with over 233,000 visits during FY2022. Our
people have an appetite for learning. And, during the early part of
FY2023, we’ll implement our new eLearning platform to provide
flexible and targeted learning for all of our people. This platform
will put learning in the hands of our people and offer thousands
of modules for personal and professional development.
We’ve identified three levers to help attract and develop the
right people and retain them:
Holistic well-being – healthy people, relationships
and environment
Our Life value shows our genuine commitment to well-being.
During the year, our focus was on mental well-being. We
implemented a single provider for our Employee Assistance
Program (EAP) to make sure everyone receives the right level of
support wherever they are in the world. We leveraged our global
EAP partnership to deliver a series of 59 global learning sessions
on a range of well-being topics.
With the uncertain external environment continuing to place
increasing pressure on our managers, we provided ‘simple talk’
mental health resources. These were supported by a mental
health fundamentals training series which we delivered to over
650 managers globally. We again engaged the business on the
importance of mental health during our mental health month
over September and October.
1. Authentic leadership
2. Everyday learning
3. Holistic well-being.
Authentic leadership - to create meaning, embrace
possibility and deliver what matters
Our leaders’ relationship with our people is paramount to
achieving our purpose. It’s what keeps our people engaged and
connected. It helps them understand how they add value, and
it’s a key aspect of retaining our talent.
Accelerating leadership at Worley starts with a clear definition
of what we mean by leadership itself. This year, we’ve introduced
our Leadership Principles; three principles that create a common
language and outline the expectations of our leaders. These are:
• Create meaning: Build a vision for the future and inspire others
to get there
• Embrace possibility: Build a culture that’s curious, inclusive
and captures possibility
• Deliver what matters: Build confidence and capacity to deliver
what matters.
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Diversity and inclusion
This year, we confirmed our global action areas and continued
to build a culture of inclusion and belonging.
Leadership
vision and
capability
Fairness
Supporting our
underrepresented
people
We acted on our Inclusion Survey results
Our inclusion survey told us we need to support and develop
our leaders’ capability in inclusion and belonging. So, we set
out to improve the importance we place on diversity of thought
and experience by engaging with differences and making sure
everyone’s voice is heard.
We worked with an external partner to pilot two programs
with over 460 of our leaders in the second half of FY2022.
Inclusion for Performance: Senior Leaders’ program
Learning was focused on the links between diversity of thought,
developing a culture of inclusion and the business case for
driving performance and innovation. 78 Senior Leaders, including
some of our Group Executive, participated in an immersive,
inclusive leadership experience, supported by content sessions,
360o leadership assessment and structured conversations to
understand different lived experiences.
We will continue to develop the capability of our Senior Leaders
into FY2023 to lead inclusively.
Inclusion foundations – Operational leaders’ program
This program was delivered online as a social sprint-based
program with four modules over eight weeks with three regional
cohorts (APAC, EMEA and the Americas). Over 380 participants
enjoyed working at their own pace, the functionality of the
platform, online interactions, hearing different viewpoints and
being able to discuss concepts with diverse people from across
our business.
The method of delivery was a great way to distribute learning
across geographies and will allow us to scale learning across our
business. In FY2023, we will consider an expanded delivery of
this program.
We’re making our people processes fairer
Making fair decisions about our people emerged as a strong
theme in our inclusion survey results. Based on this, we
reviewed some of our key global policies and processes with
external partners.
We focused on refining our processes to ensure we’re:
• providing equitable reward for all our people
• reviewing for bias in our talent acquisition processes
• examining access to internal development and
career opportunities
• improving access to parental leave across our
global operations.
We’re committed to a strong focus on equitable pay to create the
right experience for our people. This means ensuring our policies
and practices reflect and encourage this. Across the broader
business, we took steps to close the gender pay review during
our annual salary review process. We are supporting our leaders
to understand how to mitigate bias when making pay decisions.
Taking a stand on sexual harassment
Sexual harassment in the workplace dominated
conversations across corporate Australia and with our
customers in FY2022. These conversations created
opportunities to review and rethink how we approach
workplace harassment.
As members of the Champions of Change Coalition,
we undertook a review of harassment and bullying.
Using the Champions of Change Disrupting the
System framework, we:
• analysed our policies, procedures and systems
• conducted interviews with people from different
levels of the business, locations and roles for their
insights and experiences
• considered the recommendations made by the Australian
Human Rights Commission Respect@Work report.
As a result, we prioritized a number of actions and launched
a pilot project in Australia. Working groups were established
in the following areas: data collection, metrics and internal
reporting; health, safety and environment; inclusion;
physical and digital environment; response and support; and
education, training and communication.
In 2023, we plan to use learnings from the Australian pilot to
support more ambitious initiatives.
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We are committed to finding additional tools to identify gender
pay difference that is not justified, so that we can take action.
See our Corporate Governance Site for our annual gender pay gap
reporting for Australia and the United Kingdom.
The review of our policies in the areas of talent acquisition and
career opportunities showed we clearly express our ambition
in achieving fair and equitable outcomes for our people and
promote and support our D&I objectives. In FY2023, we will
be undertaking further investigation to understand how the
practical application of these policies are impacting on how
perceptions of unfairness arise.
Our review of parental leave policies focused on five key
markets and identified opportunities to refine our commitment
to inclusion in our policies. We’ll look to update our policies to
ensure we have inclusive language and definitions and alignment
to global principles.
We're supporting our underrepresented groups
We’ve set out a plan to support our People Network Groups.
These act for our underrepresented groups including women,
Black and Latinx people, LGBTIQ+ people, people with disabilities
and more.
We’ve started and will continue our work into FY2023. This work
will include supporting our People Network Groups to strengthen
their effectiveness and contribute to our business and to our
diversity and inclusion goals.
Setting race and ethnicity goals
Our Group-wide aspiration is to represent and reflect the
communities in which we operate.
We continue to work towards this by identifying location-
relevant goals and actions. Given our geographic spread and
the fact that race and ethnicity issues vary by location, this
approach is both relevant to our business and reflective of
more recent practice.
• We’re driving our journey in truth and reconciliation with
First Nations of Canada through our Progressive Aboriginal
Relations (PAR) certification. We’ve reached the ‘Committed’
level and are working towards becoming a PAR Bronze level
company. This requires us to develop goals and action plans
that allow us to share in business opportunities, offer direct
employment and work closely with First Nations groups.
• In Australia, we’re completing the actions we committed to
in our ‘Reflect’ Reconciliation Action Plan (RAP). We’re also
developing our next level ‘Innovate’ RAP, which will require
us to set public targets and commitments. Our focus this
year has been on cultural awareness training across the
Australian business. We’re working toward targets for the
participation of Aboriginal and Torres Strait Islander Peoples
in our business, and procurement of goods and services from
Indigenous enterprises.
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Given our large footprint in the US, we’re now focusing on
ensuring our workforce reflects the ethnic diversity in the
communities in which we operate. We’re working with external
partners to set goals and actions and will use this work as a
template for other locations.
We will continue the implementation of this work and anticipate
expanding this process in additional markets through FY2023
and beyond.
We’ve won accolades
In October 2021, we again were represented in the ALLY Energy
GRIT awards. Our People Network Groups, representing our Black
employees and women, were recognized in the team awards.
And in the professional category, Jennifer Lee, Senior Director
Strategy, and Tiffany Titone, Project Engineer, received awards.
We were finalists in the Large Employer category at the
Engineering Construction Industry Training Board UK awards
for supporting equality, diversity and inclusion.
Our gender equality progress update on our
FY2025 targets
Role
Board
composition
Group
Executive
Senior Leaders
Collective
annual global
graduate intake
Target
for FY2025
FY2021
Result
FY2022
Result
Achieved
33%
4/12 women
Achieved
45%
5/11 women
16%
16%
46%
47%
Have a Board
composition of at
least 30% women
Retain gender
diversity of Group
Executive
Increase the
proportion of
women in our
Senior Leaders
to 20%
Minimum of 50%
women hires to
support gender
diversity in the
general workplace
Gender diversity is defined as 40% women, 40% men and 20% either women or men
or other.
We’re pleased to have maintained our goals for women on the
Board and within our Group Executive. We’ve been challenged to
increase the number of women in Senior Leader roles.
Out of 178 Senior Leaders hired, 18% were women. We’ve held
our percentage of women in Senior Leader positions at 16%,
and 47% of our graduate hires were women. 18.6% of our total
workforce are women.
WorleyOperating and Financial Review We’re involved in a range of partnerships and coalitions that
support our purpose of delivering a more sustainable world.
These are across our industry and within our sectors.
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1.3.4 Communities
Our communities business value driver refers to our strong
relationships within our sectors, with our people, customers,
investors, communities and governments, building trust and
license to operate.
Providing thought leadership across our sectors
There is no single solution to sustainable development. It
takes collaboration and partnerships to progress towards a
more sustainable world. We deliver this by understanding and
combining unique perspectives and creating opportunities
for breakthrough thinking.
As an integrator of decarbonization solutions across the energy,
chemicals and resources sectors, we provide thought leadership
to help our customers reach net zero. This creates value by
providing useable insights to governments, industry and our
customers. We’re focused on creating solutions that directly
respond to the United Nations’ Sustainable Development Goals.
Partnering across industry to reduce
methane emissions
We’ve joined Aiming for Zero, a global initiative focused on
eliminating methane emissions from the energy sector by
2030. Its signatories and supporters include some of the
largest oil and gas producers in the world. Methane emissions
from the energy sector are preventable with readily available
technologies. Facilities can then undergo methane abatement
actions, such as replacing natural-gas-driven equipment and
repairing leaks in pipelines.
Eliminating virtually all methane emissions by 2030 is
possible, which is why we’re pleased to join the OGCI’s
Aiming for Zero initiative to support our customers as they
strive to reach near zero methane emissions from their oil
and gas assets,” says Tom Foster, Senior Vice President of
Upstream Hydrocarbons at Worley.
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From Ambition to Reality
To limit the worst impacts of climate change, global greenhouse gas emissions must be driven to net zero by mid-
century. Worley and Princeton University’s Andlinger Center for Energy and the Environment have been examining the
infrastructure that will be required to meet this enormous challenge.
In our first paper of the net-zero ‘Ambition to Reality’ series, released in August 2021, we concluded that we will simply fail
to build at the necessary scale and pace unless we completely rethink the way we design and deliver. We outlined a new
delivery paradigm with five key shifts essential for transformation.
In our second paper to be released in early September 2022, we use the five shifts to convert thinking into action,
throughout this critical decade for climate action and onwards to 2030. We demonstrate that these shifts are already
used by some in industry, but also remind the readers of the scale of the challenge by considering new net-zero numbers
for another economy. We consider and define which leading indicators of change will be needed to help correct the world’s
infrastructure path, how they will be measured and just what success will look like to move the world’s net-zero ambition
to reality.
Shift from
“economic” to
“social-economic-
environmental”
Broadening
value
A new
paradigm
Enabling
options
Address
uncertainty
through
development of
all technologies
Digital platforms
create the trust
to move forward
The digital
accelerant
Creating
partnerships
Standardisation
Governments set
the objectives, and
partnerships form
Replicate designs
and build in parallel
WorleyOperating and Financial Review Promoting reconciliation and First Nations economic
development in the work we do
As a global business headquartered in Australia, reconciliation
is an important issue which demands a strong response. We
respect First Nations heritage and livelihoods where we operate
and are taking steps towards meaningful reconciliation in
Australia and Canada. See page 94 for more detail.
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This year, we also participated in the Indigenous Employment
Index, sponsored by the Minderoo Foundation. This is
a comprehensive snapshot of Indigenous workplace
representation, practices and people experiences. We
participated as part of our own reconciliation journey. An
important part of our commitment is using opportunities
to learn. The Index provides us with our own benchmark to
build from as well as recommendations from industry and
community leaders for increasing employment outcomes for
Indigenous Australians.
Creating shared value where we operate
Through the Worley Foundation and our networks and programs,
we connect the diverse skill sets and passions of our people to
help support sustainable communities and ecosystems.
Building the STEM active generation of tomorrow
Through Unlock your genius and other activities, we encourage
the youth of today to engage with STEM fields, creating a range
of opportunities for their futures. Not only is this critical for our
industries but also to the sustainability challenges our world
faces. As technology providers, we have a wealth of technical
knowledge to contribute to support STEM engagement.
We’re working on this with organizations that share this
common goal. Whether it’s through skilled engineering outreach
or projects funded by the Worley Foundation, our people are
passionate about making a difference.
Dollar matching for Ukraine
This year, we held a dollar-match
fundraiser with the Red Cross
to support humanitarian aid
in Ukraine. Together we raised
$82,764.
This piece represents Worley's values and connection to the land. On each side of the painting the connected web of circles and lines represent the network of each person
that works for Worley, these connections create a stronger and better workplace for all and promote our people to rise to the challenge as a collective. This as a foundational
value, Worley is able to unlock brilliance in what they aim to achieve and to better work with Indigenous Communities collaboratively and respectfully, this is represented in
the middle with the large circle and people around it. Just outside the web and the large circle are the Indigenous Communities represented in blue and orange, the colours of
Worley. These colours also represent the differing Aboriginal Communities, blue for saltwater people and orange for inland or desert people. In the background I have used an
ochre red colour to represent the soil of Australia that gives life to everything around us especially the native flora and fauna which is represented in leaves, gum nuts, honey
ants and animals that travel this Country. By Marlie Albert, proud Baard Baniol woman from Broome, WA.
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Through our three-year partnership with Girls Inc. of Greater Houston, Worley hosts
girls from the greater Houston area. Through panel discussions and networking, we
aimed to inspire high school success and realize their potential.
The Worley Foundation
The Worley Foundation promotes positive environmental and social impact where we operate. It’s governed by a Council
that’s representative of a diverse group of Senior Leaders across the business.
We’ve structured the Foundation around three key pillars:
• Creating shared value: The Foundation funds projects that are high impact and create shared value for communities and
for Worley.
• Contributing to the communities in which we operate: Projects are in locations where we have a presence, encouraging
our people to make a positive contribution to delivering a more sustainable world where they live and work.
• Targeting key themes of sustainable development: Projects focus on either STEM education, skilled volunteering or
environmental and community benefit.
We disclose our corporate financial donations transparently.
$2,029,455
Non-legislated contribution
$855,406
Legislated contribution
$2,884,861
Total contribution
Through our sponsorship of the Big Umbrella, Worley volunteers
cook and serve food to Victorians experiencing food insecurity
in Melbourne.
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WorleyOperating and Financial Review Supporting economic development
Direct economic value generated and distributed
This year we distributed $9,814 million in payments that flow into our economy and communities. How this economic value is
distributed is shown below.
S
o
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$9,863m
Economic Value Generated
and Received1
$49m
Economic Value
Retained2
$262m
$9,552m
Distributed to
our shareholders
Dividends paid (see page 159)
Distributed to our other stakeholders via:
Employee and supplier costs paid (see page 159)
• This includes our corporate financial donations (page 98)
Income taxes (see page 159)
Interest on loans (see page 159)
Indirect economic impacts
We support projects in the energy, chemicals and resources sectors internationally. These include projects that enable communities
to develop economically via productive use of natural resources and skills development, thereby lifting communities out of energy poverty.
We also make a wider economic contribution across a range of countries through various activities such as the Worley Foundation and
other corporate social-responsibility programs, such as those in India and South Africa, and local content procurement programs.
Our people spend their wages locally on diverse goods and services, providing a further indirect economic contribution. We do not
measure this indirect economic benefit globally, however, it is an important component of our contribution in the 46 countries in which
we operate.
We contribute our global technical and project delivery expertise as well as our experience of different industry standards and
regulatory approaches to relevant governments and industry groups internationally. This input is provided for consideration in
the development of industry standards and government policy.
We're doing this, for example, through our partnership with IBM and ABB (see page 15).
1 Receipts from customers (see page 159).
2 Economic value generated less economic value distributed.
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Annual Report 2022 Governance
1.3.5 Sustainability governance
In this section, we provide an overview of our governance as it relates to ESG. For comprehensive disclosures on corporate
governance, please refer to the Directors’ Report (page 116) and our Corporate Governance Statement.
We provide strengthened ESG business governance through our framework
The Worley Board has ultimate responsibility for governance of ESG matters.
Worley Board
Internal
audit
The Worley Board has ultimate authority over and oversight of the Worley Group. The Board has adopted
appropriate charters, codes and policies and established a number of committees to discharge its duties.
External
audit
Audit and Risk Committee
Nominations Committee
People and
Remuneration Committee
Health, Safety and
Sustainability Committee
Chief Executive Officer
Group Executive
Our approach is guided by
Our risk is managed by
We drive action through
• Sustainability Policy
• Code of Conduct
• Worley purpose and values
• Life safety, health and
well-being approach
• Climate Change Position Statement
and strategic actions
• Materiality assessment
• ASX Corporate Governance Council
Principles and Recommendations
• Modern Slavery Statement
• Reconciliation Action Plan
• Corporate Governance Statement
Policies and standards
• Sustainability Policy
• Code of Conduct
• Supply Chain Code of Conduct
• Diversity and Inclusion Policy
• Human Rights Policy
• Bullying and Harassment Standard
• Health, Safety and
Environment Policy
• Whistleblower Policy
• Corporate Responsibility Policy
• Securities Dealings Policy
• Continuous Disclosure Policy
• Anti-Bribery and Corruption Policy
• Indigenous Peoples
Engagement Policy
• Supply Chain Code of Conduct
• Opportunity and contract
risk processes
• Quarterly risk review by Audit
and Risk Board Committee
• Enterprise risk management
• Knowledge and management system
• Risk and assurance framework
• Executive remuneration framework and
key performance indicators
• Net-zero roadmap
• Sustainability Working Group
• Extended Leadership Team
(steering our transformation)
• Worley Foundation Council
• Global Diversity and Inclusion Council
• People network groups
• Sustainable Solutions process
• Sustainability Champions Network
Policies and standards
• Gifts, Entertainment, Hospitality
(all ‘Gifts’) Standard
• Agent Standard
• Responsible Business
Assessment Standard
• Ethics Helpline
• Risk Management Policy
• Risk Management Standard
• HSE Risk Management Standard
• Environmental
Management Standard
• R3 Standard
• Special Risks Standard
• Delegation Standard
• Joint Venture Governance Standard
Annual and sustainability
reporting and internal reviews
• Annual Report
• CDP Report
• Corporate Governance Statement
• Tax contribution report
Jurisdiction-specific reports:
• Modern Slavery
• Diversity
• Carbon reporting
Annual risk review processes:
• Quarterly risk review
• Material risk process
• TCFD
Our purpose, values and behaviors underpin our approach
We communicate our performance transparently as part of our annual reporting suite
This constitutes our communication of progress to the United Nations Global Compact, to which we have been a signatory
for 12 years.
We align our reporting to global reporting frameworks, including GRI, TCFD, CDP and the UN Sustainable Development Goals.
See our Results Center, ESG data center and Corporate Governance site for more information.
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WorleyOperating and Financial Review We have a strong system of governance and operational controls
in place to ensure we operate lawfully, ethically and responsibly.
The ESG performance of the Worley Group is governed at the
Board level, with all standing committees having oversight of
various issues. The Health, Safety and Sustainability Committee,
in particular, governs the Group’s and Management’s respective
performance in relation to health, safety and sustainability.
We’ve updated our Code of Conduct
This applies to all of our people, Board members and anyone who
represents Worley. So far, we’ve trained over 40,000 people as
part of this year's update, which requires written confirmation that
they have read and understood the code. This includes adhering to
our strict protocol for registering gifts and entertainment. We have
zero tolerance for bribery, fraud and corruption.
We expect ethical behavior from our suppliers
and customers
In the past year, our team of due diligence analysts have
increased our supply chain and customer due diligence checks
by 25% to a total of 10,995. Our team uses third-party research
tools and external due diligence analysts as required.
We have a centralized communication process between our sales
and due diligence teams to make sure we identify red flags early.
Where we find red flags, we escalate to Senior Management and
get specific approvals before submitting a bid.
We're working to address Modern Slavery
We plan to publish our second Group-wide Modern Slavery
statement at the end of 2022, in keeping with our global
regulatory obligations including the Australian Modern Slavery
Act 2018 and the UK Modern Slavery Act 2015. We are continuing
to improve the way we manage Modern Slavery risks and are
expanding our actions.
We continue to be an active member of Building Responsibly
and have committed to operating in line with its Worker
Welfare Principles.
Over the last year, we conducted a review of our policies and
procedures against the UN Global Compact and the Building
Responsibly Worker Welfare principles. As a result, we’ve
updated several policies and business documents (our Modern
Slavery Policy, Human Rights Policy and Talent Acquisition and
Promotion Standard) and have passed training requirements
onto our training teams. Additionally, we continue to work with
Building Responsibly and its partners on training options and
information on the topic of worker welfare.
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Our Whistleblower Policy and Ethics Helpline
Our Whistleblower Policy encourages whistleblowers to come
forward with information relating to breaches and potential
breaches of our Code of Conduct.
Our Ethics Helpline is open 24 hours a day, 7 days a week, to
provide a platform for our people to report any issues related
to unethical behavior. The Helpline is also open to former
employees, their families, suppliers, partners and customers.
Over the last 12 months, our team responded to 180 reports,
and 38 were substantiated. We have had no monetary losses as
a result of legal proceedings associated with bribery, corruption
or anti-competitive behavior in the past year. Further, we
have no active projects or backlog in countries with the
20 lowest rankings in Transparency International’s Corruption
Perception Index.
Partially/Substantiated
In process
Unsubstantiated/
Insufficient
Information
17%
34%
Allegation
status
49%
Craft workforce
Office-based
workforce
20%
Allegation
source
80%
Focusing on sustainability in our supply chains
Our procurement teams follow our Supply Chain Code of Conduct,
which sets our expectations of suppliers. These are the same
standards we expect of ourselves and cover:
• governance and ethics
• human rights and fair employment
• health and safety
• the environment
• supply chain
• community engagement.
This year, we've completed 6,660 due diligence checks to ensure
we're responsibly managing our supply chain. Our compliance
teams review these for any risks of bribery, corruption, modern
slavery, human rights and sanctions. All negative findings are
reported to the procurement teams, who then work with the
supplier to mitigate the risk appropriately.
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Cyber security and data protection
We ensure the confidentiality, integrity and availability of both
our own and our customers’ information and provide protection
against unauthorized information access and information loss or
destruction through our cyber security program.
Led by the Chief Information Security Officer (CISO), we have
a dedicated information security organization to protect our
intellectual property, IT systems and digital services. We
partner with Manage Security Service Providers for 24/7/365
monitoring, alerting and response. Furthermore, we've
developed strategic partnerships with top-tier cyber security
corporations to support and augment our internal intelligence
and threat hunting program.
Our information security strategy and decision-making is
overseen by our Information Security Council (ISC). Its members
include our CISO, Data Privacy Officer and key business, HR,
Digital and IT leaders. Our Information Security Management
System has been certified to meet the requirements of
ISO 27001. Additionally, our information security strategy is
aligned to the industry-recognized NIST Cyber Security Framework.
Furthermore, we continue to evolve our program to stay ahead of
the curve in the ever dynamic cyber-threat landscape.
Our Data Protection Office governs compliance of our cyber
security program with global data protection requirements
as specified in Australia, Europe, the US and elsewhere.
Laws and regulations governing data privacy and the
unauthorized disclosure of confidential information, including
the European Union General Data Protection Regulation and
the Australian Privacy Act, pose increased monitoring and
compliance requirements. Any failure to comply with these
laws and regulations could result in penalties, legal liability and
reputational harm. The Data Protection Office also contributes to
strengthening our systems, processes and user education.
Responsible Business Assessment Standard
We assess our bid opportunities using our RBA Standard. This
informs which projects we bid for and execute. The RBA's
decision-making principles are embedded into our sales and risk
management processes, enabling us to better understand and
escalate projects of high ESG risk to our senior business leaders
and CEO.
Our RBA Standard is aligned to our purpose of delivering a more
sustainable world. This includes assessment of our involvement
in carbon-intensive projects.
Joint Venture Governance Standard
Through our Joint Venture Governance Standard, we extend
our commitment to high standards of governance to our joint
ventures, outlining our requirements to be met. These include
due diligence, consultation and approval requirements, policies
and procedures and the ongoing requirements for governance
during the operating phase of the joint venture. All of our
joint ventures are required to complete a risk and compliance
checklist annually.
Assurance
This year, we've had independent third-party auditors provide
limited assurance on our select ESG performance metrics (shown
below). The assurance has been done in accordance with the
International Standard on Assurance Engagements ISAE 3000.
• Diversity (women employees, women Senior Leaders,
women Board members)
• Safety (TRCFR, LWCFR, SCFR)1
• Environmental (energy use, greenhouse gas emissions)
We conduct limited assurance on these metrics on an
annual basis.
We aim to embed sustainability thinking
in the way that we do business
To deliver a more sustainable world, we aim to embed
sustainability in the way we design, construct and
determine the types of projects we execute.
We drive safety and sustainability in engineering design
through our Safe and Sustainable Engineering for
Asset Lifecycle (SEAL) process. This year, alongside our
Safety in Design manuals, we’ve created Sustainability
in Design manuals across all of the major engineering
disciplines.
Our engineers will use these to make sure they
optimize their designs for sustainability. This links with
our Sustainable Solutions process where we quantify
the impact of sustainability thinking in design and
construction, such as reductions in carbon emissions.
1 Refer to Glossary.
102
WorleyOperating and Financial Review 1.4 Outlook
1.4.1 Outlook
We are well positioned to meet the opportunities and challenges
of the current market. The geopolitical environment is elevating
the need for energy independence and security of supply.
We’re seeing opportunities in areas such as early phase work
in integrated gas and renewable energy sources. We continue
to manage inflationary impacts and we remain optimistic that
without further deterioration in conditions the outlook will
not be materially affected. We continue to attract and retain
talent while building capability in support of our strategic
transformation journey.
Customer investment in both traditional and sustainability work
continues to increase, with sustainability investment growing
at a higher rate. We are seeing increasing activity levels and
investments by our customers across all the sectors we operate
in, although each region is experiencing different rates of growth.
We expect our average FY2022 underlying EBITA margin
(excluding the impact of procurement) to be sustained into FY2023.
We are seeing positive indicators that support our expectations for
improved revenue (excluding procurement) in line with customer
investment growth across our sectors. This is further supported
through our increased backlog and the growth in the factored
sales pipeline. Our cost saving program is continuing to deliver
operating leverage. As part of this outlook, procurement revenue
is expected to be higher in FY2023 compared with FY2022.
1.4.2 Unreasonable prejudice and
forward-looking statements
We’ve omitted information about our internal budgets and
internal forecasts from this review. We’ve also omitted details
of our business strategy. This is on the basis that doing so would
have been likely to result in unreasonable prejudice towards us.
This review contains forward-looking statements. These include
statements of our current intentions, opinions and expectations
about our present and future operations, events and financial
prospects. While these statements reflect our expectations on
the date we published this review, they’re not certain and are
susceptible to change. We make no representation, assurance
or guarantee as to the accuracy or likelihood of fulfilling any
such forward-looking statements (whether express or implied)
except as required by applicable law or the ASX Listing Rules.
We disclaim any obligation or undertaking to publicly update such
forward-looking statements.
Image taken by Lars Christopher Nottaasen, Management of Change Lead – Jotun, Rosenburg, as part of our Earth Day photo competition.
103
Annual Report 2022 1.5 Risk management
1.5.1 Our approach to risk management
Our approach to risk management and our strong culture
helps us to create and protect our value. We encourage
open and transparent communications across the Group.
This involves visible leadership, identifying the material risks
we face, and informed decisions that align to our Company
ambition and values.
Our Board sets the risk appetite for the Group. It considers the
amount and type of risk the Group is prepared to take. This is
operationalized within the Group’s processes and procedures
to support our project pursuit and execution work.
We take a coordinated, systematic and tailored approach
to risk in combination with our risk management processes.
The Board requires us to monitor, review and report on
our risk management throughout Worley. Risk is a standing
agenda item with the Board and routinely addressed within the
Board committees. The Chair of the Audit and Risk Committee
may be invited to attend meetings with the People and
Remuneration Committee or where considered appropriate
provide feedback, including with respect to risk-adjusted
remuneration outcomes and the alignment of remuneration
with the risk management framework.
Risk Management Framework
Board and committees
Governance and oversight of enterprise risks
• Sets strategy, ambition and risk appetite
• Strategic decision making and alignment with remuneration
• Board and ARC risk reporting
• Disclosures and external reporting
Chief Executive Officer
Group Executive
Manages and allocates resources to deliver strategic objectives
and designated risk owners for our enterprise risks
• Strategy execution and transformation
• Business performance and Key Risk Indicators
• Risk-informed decision making
• Manage risk and report to Board
First Line –
Risk ownership
The business and
all employees
Responsible for owning, managing and
reporting risk in their operations and
ensuring controls are in place.
Second Line –
Risk enablement
Group functions
Support to First Line and provide
independent challenge. Risk group
responsible for risk framework and
policies to enable consistent
approach to risk across the Group.
Third Line –
Risk assurance
Internal audit and third-party
audit providers
Responsible for independent
assurance on effectiveness of
controls in relation to
risk materiality.
External Audit
Provides external
independent assurance of
performance
Risk process
Risk process
Set Objectives and Context | Identify, Analyse , Evaluate | Innovate, Plan and Act
Engage, Consult, Communicate | Monitor, Review, Report | Learn, Improve, Perform
Enablers
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Culture and values
Data and tools
Capability
Governance
WorleyOperating and Financial Review 1.5.2 Our risk management framework
Our risk management framework provides the foundation
for creating and protecting value. We align with the principles
and framework of ISO 31000 Risk management guidelines.
The Institute of Internal Auditors’ Three Line model frames
our organizational structure’s risk management roles and
responsibilities. Combined, they provide a platform for strong
governance and risk management.
1.5.3 Our risk management process
The International Integrated Reporting Framework guides
our principal (material) risk reporting. We aim to disclose
matters (risks) that may substantively affect our ability
to create value over the short, medium and long term.
The Board Audit and Risk Committee and Group Executive
meet regularly to review our principal risks, the effectiveness
of our controls and our performance. They also monitor risk
indicators to assess that the operations are working within our
risk appetite.
Risk identification
We identify risks that have – or may have – an effect on our
ability to create value from the top down and bottom up. We
view this from the perspective of the risk’s effect on the Group’s
objectives and its ability to deliver and realize them.
To help us identify risks, we research and engage with external
and internal stakeholders to understand issues that might stop
us achieving our objectives. This includes but isn’t limited to:
• existing and prospective customer engagements
• hearing from our people through townhall sessions
and surveys
• investor presentations and roadshows
• business partner and joint venture meetings
• industry, regulator and policy maker interactions.
Risk evaluation and prioritization
We do risk assessments and workshops to evaluate and
prioritize risks. These include emerging risks which may present
us with medium to long-term risk exposure. We use qualitative
and quantitative methods to define risk consequences. We
view consequences across a spectrum of possible financial and
non-financial impacts, such as occupational health and safety,
operational, strategic, reputational and regulatory. To prioritize
risks, we use our Group risk matrix and consider the risk’s
consequences as well as its likelihood. This helps us to identify
risks that have the potential to be the most significant.
We document risks in a risk register to support ongoing
communication and management. We perform these activities
at all levels within the Group, from the Board to business
operations. Our risk management framework enables us to
share and talk about risks to make sure we have the right
level of management and Board oversight.
Risk disclosure and reporting
We review our risks to determine which ones are current
and most significant – or have the potential to impact
our ability to create and preserve value. We consider the
following risks to be our principal enterprise risks, and these
are summarized via our business value drivers.
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Annual Report 2022 1.5.4 Our principal risks
Key: S = Short term M = Medium term L = Long term
Finance
Project delivery
Risk Description
Our ability to execute projects successfully (quality, on time, to
budget), meet contractual obligations and customer expectations
and maintain core operations, while growing our strategic
sustainability portfolio.
We have a diverse skill set. This enables us to deliver specialist
consultancy advice through to large complex projects. We use
our global capability to deliver value to our customers across
all major energy sectors.
If we fail to manage our contracts well or deliver poor-quality
work, we could find ourselves in disputes with our customers
around fees, costs or delays. This could lead to liability claims
or legal action and reputational damage, and it could reduce
future significant project wins.
S M
How we are managing this risk
We support our consultants, engineers, construction workers
and other project delivery specialists with:
• Project risk exposure assessments. These determine the
level of management seniority we need to take part in the
bidding decision-making process.
• Project Delivery framework. This supports execution
through knowledge and management systems,
standardized delivery applications and global specialist
capability networks.
• Project Delivery Group. This team provides support during
project initiation for our key projects and embeds lessons
learnt into execution strategy.
• Commercial management framework. This makes sure
our contracts are fit for market conditions, including
inflation pressures, supply shortages and other potentially
disruptive events. It also makes sure our contracts are
compliant, and that we manage and approve scope and
contract variations effectively.
• Project governance structure. This supports monthly
project performance reviews and identifies projects that
will need more support.
• Employee learning and development and competency
programs.
• We do not engage in material LSTK EPC projects.
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WorleyOperating and Financial Review
Finance
Liquidity
Risk Description
Our ability to maintain sufficient liquidity through cash and/
or borrowing facilities to enable us to meet our payment
obligations as and when they fall due.
We take a diversified approach when establishing and
managing Group facilities.
We source debt capital from different markets in order
to diversify the portfolio. Our global operations focus on
customer engagement to support timely issuance of invoices
and cash collection.
If we are unable to generate and maintain sufficient liquidity,
we may not be able to fund some or all of our operations
and/or achieve our ambition partially or in full. This may also
impact our ability to service debt and may lead to challenges
in meeting the terms of our banking covenants.
S M
How we are managing this risk
Our Finance, Treasury, project and operational teams
manage cash flow.
They are helped by the following:
• Our Treasury function manages group liquidity through
funding and investments. It also manages financial
risks, such as foreign exchange, inflation, interest and
financial counterparty credit.
• Treasury Framework and Risk Standards and processes
support working capital management, cash flow and
monitoring.
• Treasury has a set of authority limits that have been
approved by the Board.
• Diversified debt facilities ensure we aren’t reliant on one
type of debt facility or debt provider. Our debt facilities
include a sustainability-linked bond that was established
in 2021 via a Euro Medium Term Note (EMTN) program.
With this, we were able to access debt beyond traditional
banking groups.
• Project and business operation procedures to support
timely and effective cash collection.
ESG performance and access to capital
S M L
Risk Description
How we are managing this risk
Our ability to raise capital effectively through demonstration of our
ESG performance.
Sustainability is core to our business, and our purpose is at
the heart of all we do. This supports the following:
Our purpose is to deliver a more sustainable world. The
biggest contribution we can make to this is through the work
we do for our customers. As they and the rest of the world
invest in decarbonization, our portfolio is shifting towards
a larger component of sustainability related work – 32% of
aggregated revenue for FY2021 and 35% for FY2022. This
allows us to access capital markets and investors who are
focused on ESG credentials, and where the cost of capital is
reduced for companies with strong ESG credentials.
If we don’t deliver our ESG commitments in line with our
purpose and ambition, we won’t be able to grow and deliver
superior earnings for stakeholders.
• Our strong ESG performance has allowed us to issue a
sustainability-linked bond and loan offerings.
• We focus on continuous improvement in our ESG
performance. Our external ESG ratings include AAA rating
with MSCI, B rating with CDP, 24.4 with Sustainalytics and
36 with S&P Global’s Corporate Sustainability Assessment.
• Our Responsible Business Assessments (RBAs) evaluate
unacceptable referred reputation risk. This could stem from
unethical business practices, carbon emissions intensity
works and social license issues. All our pursuits complete
this assessment.
• Retention of investment-grade ratings with credit agencies,
showing our strong credit value proposition.
• Debt and equity investor relationship engagement with
existing and prospective investors and banks. We showcase
our ESG performance via our online ESG data center.
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Annual Report 2022
Knowledge, technology and data (Intellectual capital)
Energy transition and emerging technology
S M L
Risk Description
How we are managing this risk
Our ability to navigate the Group’s portfolio through the energy
transition and to use new and developing technologies to help us
realize our purpose and ambition.
As the world transitions towards and operates in a
low-carbon economy, the most influential economies and
companies have pledged decarbonization and electrification
targets across all sectors. This is accelerating the energy
transition and leading to growth opportunities for us.
We will focus on entering new markets and new technologies
to progress our purpose, deliver our sustainability
commitments, diversify our services and realize our
sustainability solutions.
An untimely or slow transition could lose Group value and
reduce the share price.
Our risk and strategy processes and governance challenge
and guide us. We’ll continue to help our customers deliver
sustainable economic, social and environmental progress
through their projects, operations and supply chains.
We continue to:
• Complete analysis on both broad market opportunities
and our key strategic focus areas to continuously
inform our strategy. This also helps us to prioritize
growth-market opportunities which we channel
through our transformation program.
• Define key energy transition opportunities through annual
strategic works (market data analysis, macro trends,
scenario analysis and multi-dimensional deep dives).
• Understand best and worst cases and sensitivities
through financial scenario planning.
• Work with research institutions and industry bodies
and attend conferences and seminars to keep abreast
of technological, market and policy changes related to
energy transition.
• Pursue strategic partnerships, aligned with our
sustainability goals. This includes our Princeton
partnership, where we created our first joint thought
leadership piece on delivering net zero by 2050.
• Develop new contracting models, including solution-based
models, that will help us to achieve our FY2026 target of
75% revenue from sustainability-related business.
• Improve work efficiencies and incorporate new technology
through our digital strategy.
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WorleyOperating and Financial Review
Knowledge, technology and data (Intellectual capital)
Cyber security and information technology
S M
Risk Description
How we are managing this risk
Our ability to ensure the confidentiality, integrity and availability of
Worley and customer data, and to use IT systems and networks.
The external landscape is dynamic and continuously evolving.
It presents us with both risks and opportunities.
Unauthorized access, cyber-attacks or internal unintentional
human error could all compromise our operational reliability
and security. This could lead to business disruption, loss
of critical, sensitive or personal data and related fines
or penalties.
Delivery of strategy and ambition
Risk Description
Our ability to effectively execute and manage transformational
change.
It includes investment and divestment at the pace and quality
required to deliver our strategic intent and ambition, within an
increasingly complex environment.
If we fail to adapt and evolve, it may lead to loss of market
share and/or negatively impact our financial performance.
Our Information & Digital Delivery team is dedicated
to helping the business work effectively and securely.
Team responsibilities include:
• Information security policies and standards in line with
international Standard ISO 27001.
• Cyber security framework of process controls, which include
automated surveillance, system, network and
end-point protection, detect and respond capability
and 24/7 monitoring.
• Employee security education programs, including phishing
awareness and testing campaigns.
• Employee and third-party, including our customers’ data
security via the Data Protection Office.
• Business continuity and incident response plus operational
response exercise drills.
• Preparation to meet the Australian Security Legislation
Amendment (Critical Infrastructure) Act 2021 as it applies
to Worley.
• Innovation Hub, where new ideas are generated, worked on
and commercialized.
S M L
How we are managing this risk
Our operating model, control structures, collaboration
frameworks and partnering models help us to deliver
our ambition. We continue to focus on:
• A dedicated Group Executive member who leads the
Transformation program. Accountabilities include
planning, performance monitoring and governance
for the transformation program as a whole.
• Establishing growth units and strategic priorities.
We are investing in accelerating our growth into key
sustainability-related markets.
• Enterprise-wide change management, including
developing an ambition learning program. This will
enable all employees to take part in and learn ways
they can support our strategy.
• The program will provide reporting. This is to track the
delivery of the strategy, escalate risks and issues as they
arise, provide insights and support decision making.
• The program and the Board will assess acquisition,
partnerships and divestment activities that support
our transformation.
109
Annual Report 2022
Equipment and fabrication
Fabrication and licensing
Risk Description
How we are managing this risk
S M
Our ability to fabricate and deliver structures, equipment or
licensed technology to specifications and design requirements.
We support our team of fabrication experts and technology
specialists to manage this risk by:
As well as broader design and consultancy work, parts of
our business manufacture equipment and modules for the
energy, chemicals and resources sectors at our fabrication
yards. They also work as technology providers for licensed
technologies, such as Chemetics® or Comprimo®.
We could find ourselves in disputes with our customers
around fees, costs, changes or delays if the equipment,
modules or technologies don’t meet specification. Or if we
deliver poor quality work. This could lead to claims against
our mechanical warranties, liability claims or legal action
and reputational damage. It could also reduce future project
wins. Poor-quality work could compromise the safety or
environmental outcomes for installation and operation.
• Enhancing our local capabilities with support from our
global centers of excellence. And via our global network of
consultants, engineers, construction workers and other
project delivery specialists.
• Having a defined process for reviewing technology-related
process guarantees, back-to-back agreements with
technology partners and proprietary key equipment and
chemicals. This ensures the process guarantees are met.
• Obligatory verification of key design documents, prepared
by the detailed engineering contractor. These need to be
approved before being manufactured. Our technology
experts also need to be on site during commissioning
and start-up. This is so they can guide the operation,
train the operators and perform the final test run and
plant acceptance.
110
WorleyOperating and Financial Review
People
Safety, health and well-being
Risk Description
How we are managing this risk
S M
Our ability to ensure the safety, health and well-being of our
people when they’re working.
The safety, health and well-being of our people is our main
priority. Without this, nothing else matters. We continue our:
We sometimes work in high-risk geographies, travel long
distances by road and engage in construction and operating
activities. These all bring with them the risk of injury, illness,
and loss of life. The workplace has the potential to have an
impact on the mental, emotional and social well-being of
our people.
Our work may also positively or adversely impact the
safety, health and well-being of the communities in
which we operate.
Talent
Risk Description
Our ability to retain, attract and engage talent and build capability
and skills for the future.
As the pandemic shifts to endemic and economies recover,
we’re facing a very buoyant talent market. It’s one of the most
challenging talent markets we’ve faced into for some time.
If we fail to build the new capabilities and attract and retain
talent, it could impact our ability to win new work, deliver our
contractual requirements and achieve our objectives.
• Health and safety framework. This includes expectations of
our people and the people we manage. These are supported
through core Life programs, training and champions, our
mental health networks and our business processes.
• Security, crisis response and business continuity planning
via our R3 (Ready, Response, Recovery) processes and
subject-matter experts.
• Diversity and inclusion programs to support a culture of
psychological safety.
• Dedicated working groups, exploring and learning what
more we can do to prevent and respond to workplace sexual
harassment.
• Commitment to safe and responsible presence in the
communities in which we operate. We outline more details
in the Ethical and business practices and Social value risks.
S M
How we are managing this risk
Our people enable our success. Our purpose resonates with
them and makes them want to be part of a business that’s
delivering a more sustainable world. We have put in place:
• Streamlined recruitment processes to speed up the hiring
process.
• Competitive remuneration frameworks.
• Recognition, reward sponsorship and succession programs.
• Hybrid working arrangements involving a mix of working
from home, office and/or site. This lets our people work
flexibly, be productive and collaborative and supports their
well-being.
• Commitment to invest within the business to deliver
strategy through growth of specialist capability. This
includes employee training programs. Many of our people’s
skills are transferable, and training supports a rapid shift.
• Diversity and inclusion programs, targets and regular
employee-engagement surveys.
111
Annual Report 2022
People
Ethics and business practices
Risk Description
Our ability to comply with the law and do our business to the
highest standards.
This includes working with customers, partners and suppliers,
aligned with our values and ensuring we manage the supply
chain ethically. This includes complying with legislation to do
with anti-bribery and corruption, export controls, sanctions
and data privacy regulations.
Our behavior is defined through our words and actions.
Sometimes we can find ourselves in situations where our
values are challenged, and it’s not always clear how we
should act. Our Code of Conduct sets out standards of
professional behavior, our responsibilities and the ethical
standards we uphold.
We operate globally and need to meet local legislative and
regulatory requirements. If we fail to work ethically or within
laws and regulations, it could lead to a non-compliance or
regulatory breach. This might result in an investigation,
reputational damage, fines and penalties.
S M
How we are managing this risk
We work closely with our customers, third-party suppliers
and partners to enable respectful and responsible business
practices. And to ensure that we align the impacts of our work
with our purpose and ambition. The following supports us
in this:
• Compliance management framework with due diligence
procedures and independent internal audit processes. Our
legal and compliance functions help the business to operate
within the law for all relevant jurisdictions.
• Supply chain and due diligence processes. These include
supplier codes of conduct, strict procurement processes,
monitoring agents and third-party recruitment providers.
• Annual Code of Conduct training for all employees.
• Gifts, Entertainment and Hospitality Standard, including
gift registers.
• An anonymous and confidential ethics helpline that’s
operated by an external service provider, 24-hours,
7 days a week.
• During the pursuit stage, we perform Responsible Business
Assessments. These evaluate the risks associated with
trade sanctions, ethical business practices and the
social license of a project.
• Modern Slavery statement. We recognize we need to
manage Modern Slavery risks as an organization which
operates in geographically diverse locations and in high-risk
sectors. These include construction, fabrication and mining,
minerals and metals. We have governance processes in
place to ensure we take action when we become aware of
non-compliance.
• We have a Human Rights policy, and we align our operating
procedures with the United Nations’ Building Responsibly
Worker Welfare Principles. We are also a signing member.
• Our Data Protection Office to lead our data privacy
compliance program. We outline further mitigations in
Cyber security and information technology risk.
Image taken by Lizeth Urena, Electrical Technical Specialist, as part of our Earth Day photo competition.
112
WorleyOperating and Financial Review
Communities
Social value
Risk Description
Our ability to maintain stakeholder (shareholder, customer,
community, employees, partners) trust by acting in line with our
purpose and values and/or the expectations of stakeholders and
the community.
We rely on our reputation to win and retain work, attract
and retain employees and secure lines of credit and access
to capital. By building trust among our stakeholders, we can
form strong partnerships and together contribute towards
delivering a more sustainable world.
If we fail to maintain trust among stakeholders, it could lead
to negative media attention. It might damage our reputation
or social value, reduce our influence in industry groups or
ultimately lose our investors.
S M
How we are managing this risk
We have a strong history of partnerships and relationships.
The following underpin our ongoing performance:
• Strong operational governance framework. The tone comes
from the top and is aligned to our values.
• Responsible Business Assessment Standard to strengthen
customer and project due diligence activities.
• Engaging with investors transparently and disclosing ESG
data. This includes the new release of our online ESG data
center.
• Internal programs and support networks (Pride@Worley,
Women of Worley, Kuumba, Sustainability Champions
networks). These ensure we align our activities with
employee and community expectations.
• Diversity and inclusion improvement plans and public
targets. We met our Board and Group Executive female
FY2025 commitment target ahead of time.
• Work with Indigenous and First Nations communities.
For example, Indigenous partnerships in Canada and our
Reconciliation Action Plan in Australia.
• Our Worley/Princeton partnership capitalizes on our
combined experience. Together, we delivered a thought
leadership paper that explored the shifts required to deliver
the energy infrastructure that will enable us to achieve
mid-century net-zero targets.
Major business disruption and resilience
Risk Description
How we are managing this risk
S M
Our ability to manage our global operations through a major
business disruptive event.
This might be due to external factors such as geopolitical
events, conflict, supply chain disruption or global health crises.
We are a global company. Our people and customers span
the continents. Our ability to navigate business impacts away
from external disruptions ensures that we keep our people
safe, deliver our projects and thrive as a business. Some
events lead to opportunities. Others, such as economic and
geopolitical uncertainty, present us with risks. These could
result in us not meeting forecasts indicated to the market.
Failure to maintain business continuity could result in
diminished financial returns and loss of company value.
Lessons learnt from the COVID-19 pandemic have
strengthened our business continuity capabilities. And they’ve
helped us respond with greater agility to the Ukraine crisis.
We continue to focus on the following:
• Our crisis response and business continuity framework
is led by our R3 (Ready, Response, Recovery) function.
It enables us to escalate up to the Board to support our
response to a crisis.
• Scenario planning (strategic and financial modelling) and
strategic geopolitical analysis. These help us review current
business activities or plan new ones.
• Our framework includes processes and procedures relating
to physical, personnel and cyber risks.
• We maintain business continuity plans for our locations and
perform checks on key controls that support continuity.
113
Annual Report 2022
Environment
Climate change
Risk Description
Our ability to manage the physical and transitional risk
implications of climate change for our business and the
industries we serve.
For example, extreme weather events could impact our
operations and employees as well as our customers.
Through our people’s collective experience and knowledge,
we’ll seek to help our customers on their energy transition
journey to reduce the carbon intensity of their assets. We’re
committed to playing our part and commit to reduce Scope 1
and Scope 2 emissions by 50% by 2025.
Navigating the energy transition provides our business
with opportunities to guide and support our customers
and industry. We discuss these further under the Energy
transition and emerging technology risk.
We report how we’re managing our climate-related risk
and opportunity in line with the recommendations of the
Taskforce on Climate-related Financial Disclosures (TCFD).
We provide this in the ESG disclosures section and in our
ESG data center.
Nature
Risk Description
Our ability to manage the physical, transitional and systemic risks
posed by nature to our business and in the industries we serve.
Issues of biodiversity loss, pollution (waste) and resource
over-extraction (e.g., water) are combining, threatening the
natural systems and ecosystem services that they provide.
This poses risks to our business. It could lead to acute and
chronic events that impact our people, operations and supply
chains. These include restricted site access and the inability
to conduct day-to-day business. Our reputation could be
compromised due to our involvement in certain projects that
might significantly degrade natural capital.
S M L
How we are managing this risk
We’ve embedded climate change considerations within core
risk and strategy processes. We also assess climate-related
risks and opportunities. We seek to continue with the following:
• Our net-zero roadmap has carbon reduction initiatives.
It’s keeping us on track with an emissions reduction of
29% in FY2022.
• Risk identification and treatment plans for physical and
transitional risks to do with climate change.
• Incorporating scenario planning for extreme weather events
into our R3 and resilience.
• We’ll also reduce emissions in our value chain. We’re working
to set a science-aligned target to reach net-zero Scope 3
emissions by 2050. We’re part of the Business Ambition for
1.5°C campaign.
S M L
How we are managing this risk
Our risk management system helps us to identify and act on
nature-related risk and opportunity. The following supports
our efforts:
• This year, we’ve strengthened our revenue
from sustainability related work. This includes
resource stewardship and environment.
• We perform nature-related risk workshops. This year, we
reviewed the water scarcity risk for our operations, using the
World Resources Institute Aqueduct Tool.
• We disclose our water and waste use at our fabrication yards
and offices that we own.
• We’ll continue to review developments and will align our
reporting with the recommendations of the Taskforce on
Nature-related Financial Disclosures (TNFD).
114
WorleyOperating and Financial Review
Financial Report
Directors’ Report
Statement of financial performance and other comprehensive income
Statement of financial position
Statement of changes in equity
Statement of cash flows
Notes to the financial statements
Directors’ declaration
Independent auditor’s report to the members of Worley Limited
Shareholder information
Glossary
Corporate information
Notes to the Financial Statements
The notes include information that you'll need to understand the financial
statements. This information is material and relevant to the operations,
financial position and performance of the Group. We consider information
material and relevant if, for example:
• the amount is significant because of its size or nature; or
• it's important for understanding our results.
We've organized the notes into the following sections:
1. Corporate Information
2. Summary of Significant Accounting Policies
160
160
Key Numbers
Here we break down the most relevant individual line items in the financial
statements. We also summarize the accounting policies you'll need to be
familiar with to understand these line items.
3. Segment Information
4. Revenue and Other Income
5. Expenses and Losses/(Gains)
6. Income Tax
7. Cash and Cash Equivalents
8. Trade Receivables, Contract Assets, and Other Assets
9. Trade and Other Payables
10. Intangible Assets
11. Provisions
163
167
169
170
172
173
174
174
176
Capital
This section includes information about our capital management practices
and shareholder returns for the year.
12. Capital Management
13. Interest Bearing Loans and Borrowings and Lease Liabilities
14. Changes in Liabilities Arising from Financing Activities
15. Issued Capital
16. Reserves
17. Earnings Per Share
18. Dividends
178
179
180
180
182
183
183
116
156
157
158
159
160
202
203
212
213
217
Risk
This section discloses our exposure to various financial risks. It also covers
their potential impact on our financial position and performance, and how we
manage these risks.
19. Financial Risk Management
20. Fair Values
Structure
This section defines the different aspects of our Group structure.
21. Investments in Controlled Entities
22. Equity Accounted Associates
23. Interests in Joint Operations
184
189
190
191
193
Unrecognized Items
This section includes information about items that aren't recognized in the
financial statements but could potentially have a significant impact on our
financial position and performance.
24. Commitments for Expenditure
25. Contingent Liabilities
26. Subsequent Events
193
194
194
Other
This section includes notes required by Australian Accounting Standards and/
or other regulatory pronouncements. It also includes important information
for understanding our results.
27. Procurement
195
28. Property, Plant and Equipment and Right of Use (ROU) Assets
195
29. Deferred Tax
30. Defined Benefit Plans
31. Related Parties
32. Remuneration of Auditors
33. Key Management Personnel
34. Parent Entity Disclosures
197
198
198
199
199
200
115
Annual Report 2022 Directors’ Report
The directors present their report on Worley Limited (Company) and the
entities it controlled (Group or consolidated entity) at the end of, or during, the
year ended 30 June 2022.
Directors' Message
Principal activities
We've set out details of our operations and activities in the
Operating and Financial Review from page 50.
Significant changes in the state of affairs
On 29 November 2021, Tiernan O'Rourke commenced as
Chief Financial Officer and Charmaine Hopkins stepped down
as Interim Chief Financial Officer.
On 1 December 2021, we announced our ambition to be recognized
globally as the leader in sustainability solutions within five years.
There are three pillars to this ambition: our People, our Portfolio
and our Planet. Each pillar has measurable objectives, which we
use to inform and guide our decisions. See Group Highlights section
of our Annual Report page 4.
On 10 March 2022, we announced the withdrawal of our services
provided in and into Russia.
On 14 March 2022, we announced that the Full Court of the
Federal Court of Australia allowed an appeal by the applicant of
the first instance judgment in the class action. On 11 April 2022,
we served an application in the High Court for special leave to
appeal the Full Court’s decision.
Our defense of the class action is funded by Worley's insurers,
except for the previously paid initial deductible amount.
Matters subsequent to the end of
the financial year
Since the end of the financial year, the directors have resolved
to pay a final dividend of 25 cents per fully paid ordinary share.
This includes exchangeable shares, unfranked (2021: 25 cents
per share). In accordance with AASB 137 Provisions, Contingent
Liabilities and Contingent Assets, the aggregate amount of the
proposed final dividend of $131 million isn't recognized as a
liability as at 30 June 2022.
No other matter or circumstance has arisen since 30 June 2022
that has significantly affected, or may significantly affect:
• the consolidated entity's operations in future financial years;
• the results of those operations in future financial years; or
• the consolidated entity's state of affairs in future
financial years.
Earnings per share
Basic earnings per share
Diluted earnings per share
2022
CENTS
32.8
32.6
2021
RESTATED
CENTS
15.7
15.6
Underlying basic earnings per share was 62.8 cents. This is
an increase of 18% from last year's financial year result of
53.0 cents.
We determine underlying basic earnings per share by dividing
the underlying profit attributable to members of Worley Limited
(as set out on page 117) by the weighted average number of
ordinary shares outstanding during the financial year (as set
out in note 17 to the financial statements).
Dividends – Worley Limited
Details of dividends in respect of the current and previous
financial years are as follows:
2022
$'M
2021
$’M
Final dividend for the full year 2022 of
25 cents per ordinary share, to be paid on
28 September 2022 (unfranked)
Interim ordinary dividend for the half year
– of 25 cents per ordinary share, paid on
30 March 2022 (unfranked)
Final dividend for the full year 2021
of 25 cents per ordinary share, paid on
29 September 2021 (unfranked)
Interim ordinary dividend for the half year
2021 of 25 cents per ordinary share, paid
on 31 March 2021 (unfranked)
Total dividends paid/to be paid
131
131
–
–
262
–
–
131
131
262
116
Worley
Financial Performance Summary
Review of operations
You'll find a detailed review of our operations and the results of those operations in the Operating and Financial Review on page 50.
A summary of the consolidated revenue and results for the current and previous financial years are as follows:
Revenue and other income
Depreciation
Amortization
Earnings before interest, tax and amortization (EBITA)
Net interest expense
Amortization of acquired intangible assets
Profit before income tax expense
Income tax expense
Statutory profit after income tax expense
Non controlling interests
Statutory profit after income tax expense attributable to members of Worley Limited
Costs in relation to cost saving programs
Impact of transformation and restructuring:
Shared services transformation
Payroll and other restructuring costs
Property leased asset (reversals)/impairments1
Transition costs2
International government subsidies, net of direct costs
Impairment of other assets
Net impact of historical legal matters
Impact of withdrawal from Russia
Gain on disposal of subsidiary/investment
Impairment of investments including equity accounted associates
One off costs of refinancing debt with Euro Medium-Term Note (EMTN) issuance
Net tax expense on items excluded from underlying earnings
Underlying tax adjustments
Certain one off other items
Underlying profit after income tax expense attributable to members of Worley Limited
Amortization of intangible assets acquired through business combinations
Tax effect on amortization of intangible assets acquired through business combinations
Underlying profit after income tax expense and before amortization of acquired intangible assets3
attributable to members of Worley Limited
CONSOLIDATED
2021
RESTATED
$’M
9,526
2022
$’M
9,705
(54)
(113)
449
(60)
(95)
294
(117)
177
(5)
172
67
53
15
(4)
3
(2)
2
16
14
-
1
-
(12)
-
-
258
95
(24)
329
(55)
(127)
319
(77)
(100)
142
(61)
81
1
82
199
-
84
60
55
(70)
12
-
-
(7)
11
4
(39)
11
(1)
202
100
(25)
277
Includes impairment of right of use assets and the related onerous property maintenance contract component.
1
2 Costs in relation to ECR integration.
3
The directors consider underlying profit information is important to understand the sustainable performance of the Company by excluding selected significant items and
amortization on acquired intangible assets.
117
Annual Report 2022
Revenue and other income
Less: Procurement revenue at nil margin (including share of revenue from associates)
Add: Share of revenue from associates
Less: Interest income
Less: Gain on disposal of subsidiary/investment
Aggregated revenue1
CONSOLIDATED
2021
$’M
9,526
(949)
210
(6)
(7)
2022
$’M
9,705
(946)
310
(4)
-
9,065
8,774
APAC
EMEA
Americas
Global support costs2
Strategic costs3
Interest and tax for associates
Underlying EBITA
AGGREGATED REVENUE1
SEGMENT EBITA
SEGMENT EBITA MARGIN
2022
$’M
1,710
3,168
4,187
9,065
2021
$’M
1,672
3,333
3,769
8,774
2022
$’M
181
283
271
735
(154)
(30)
(4)
547
2021
$’M
152
202
258
612
(146)
-
(3)
463
2022
%
10.6
8.9
6.5
8.1
2021
%
9.1
6.1
6.8
7.0
6.0
5.3
Aggregated revenue was $9,065 million. This is an increase of 3%
on the previous financial year. Underlying EBITA of $547 million
was up 18% from the last financial year result of $463 million.
Operating cash inflow for the period was $316 million, compared
to $533 million in 2021. Cash outflow from investing activities
was $62 million (2021: $92 million).
The underlying EBITA margin on aggregated revenue for the
Group, increased to 6.0% compared with 5.3% in 2021. After tax,
the members of Worley Limited earned an underlying profit4
margin on aggregated revenue of 3.6%, compared to a margin of
3.2% in 2021.
The underlying effective tax rate rose to 32.9%, compared with
30.3% in 2021. The key driver of this increase is an increase in
certain non-deductible costs under US tax law.
The Group increased its cash position to $519 million
(2021: $493 million) with gearing (net debt/net debt plus
total equity) at financial year end of 22.6% (2021: 21.7%).
Likely developments and expected results
of operations
We've set out the likely developments in our operations in future
financial years, and the expected outlook of those operations in
the Context and Strategy on page 18.
Rounding of amounts
In accordance with ASIC Corporations (Rounding in Financial/
Directors' Reports) Instrument 2016/191, we've rounded
off amounts to the nearest million dollars, unless we state
otherwise. We've represented amounts under $500,000 that
we've rounded down, with a 0.0.
1
Aggregated revenue is defined as statutory revenue and other income plus share of revenue from associates, less procurement revenue at nil margin, pass-through
revenue at nil margin, and interest income. The Directors of Worley Limited believe the disclosure of the relevant share of revenue from associates provides additional
information in relation to the financial performance of Worley Limited Group.
2 Excluding global support related restructuring costs (refer to note 3(E) to the financial statements).
3
Strategic costs comprise of costs for strategic hires and agile team development in targeted sustainability growth areas, digital enablement, internal training and
development, and creating and building strategic partnerships to deliver sustainable solutions at scale.
The directors consider underlying profit information is important to understand the sustainable performance of the Company by excluding selected significant items and
amortization on acquired intangible assets.
4
118
WorleyDirectors' Report
Board Governance
Corporate Governance statement
You can access the Company’s Corporate Governance
Statement for the year ended 30 June 2022 on the
Corporate Governance page in the Investor Relations section,
on our website.
Non audit services
Ernst & Young, our auditor, performed non-audit services in
addition to its statutory audit duties. The total fees for these non
audit services amounted to $1,072,985.
The Board has a policy governing the provision of non audit
services by the auditor. The Audit and Risk Committee has
reviewed the total non-audit services provided by Ernst & Young.
The Board has accepted the recommendation from the Audit and
Risk Committee that the total non-audit services was compatible
with the general standard of independence for auditors imposed
by the Corporations Act 2001 (Act). The directors are satisfied
that the provision of non audit services by the auditor did not
compromise the auditor independence requirements of the Act
for the following reasons:
• the Audit and Risk Committee reviewed all non audit services
to make sure they do not impact the integrity and objectivity
of the auditor; and
• none of the services undermine the general principles
relating to auditor independence in APES 110 Code of Ethics
for Professional Accountants.
This includes:
― not reviewing and auditing the auditor’s own work
― not acting in a management or decision-making capacity
for the Group
― not acting as advocate for the Group, and
― not jointly sharing economic risk and rewards.
A copy of the auditor’s independence declaration, as
required under section 307C of the Act, is as follows:
Ernst & Young
200 George Street
Sydney NSW 2000 Australia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
Auditor’s independence declaration to the directors of Worley Limited
As lead auditor for the audit of the financial report of Worley Limited for the financial year ended 30
June 2022, I declare to the best of my knowledge and belief, there have been:
a. No contraventions of the auditor independence requirements of the Corporations Act 2001 in
relation to the audit;
b. No contraventions of any applicable code of professional conduct in relation to the audit; and
c. No non-audit services provided that contravene any applicable code of professional conduct in
relation to the audit.
This declaration is in respect of Worley Limited and the entities it controlled during the financial year.
Ernst & Young
Scott Jarrett
Partner
24 August 2022
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Indemnities and insurance
Under the Company’s Constitution, we indemnify each current
and former officer of the Group against certain liabilities and
costs incurred by them as an officer of the Group.
We also indemnify each current and former officer of the Group
against certain liabilities and costs incurred when the officer acts
as an officer of another body corporate at the Company’s request
and the liability or cost is incurred in that capacity.
This indemnity does not cover any liabilities or costs that we're
prohibited from indemnifying under the Act.
We've also entered into Deeds of Access, Indemnity and
Insurance with certain officers of the Group. Under those deeds,
we agree (among other things) to:
• indemnify the officer to the extent permitted by law and the
Company’s Constitution;
• maintain a directors’ and officers’ insurance policy; and
• give officers access to Board papers.
We maintain a directors’ and officers’ insurance policy that,
subject to certain exemptions, covers former and current
officers of the Group. During the financial year, we paid insurance
premiums to insure those officers. The contracts of insurance
prohibit us from disclosing the amounts of the premiums we
paid and the nature of the liability covered.
Environmental regulation
The majority of our customers are responsible for obtaining
environmental licenses for their projects and assets. We typically
help customers, who own or operate plant and equipment
or have obligations over natural resources, to manage their
environmental licenses and responsibilities
We do have environmental responsibilities, which relate
to complying with environmental controls and exercising
reasonable care and skill in our design, construction
management, operation and supervising activities. We
manage the risks associated with environmental issues
through our risk management and assurance systems.
We comply with all environmental regulations that apply to us
and our work. The Company confirms, for the purposes of section
299(1)(f) of the Act, that it is not aware of any environmental
regulations under the laws of the Commonwealth of Australia, or
of a State or Territory of Australia that the Group has breached.
119
Annual Report 2022
Directors
Our Board of directors is listed below:
• John Grill (Chair)
• Andrew Liveris (Deputy Chair and Lead Independent Director)
• Thomas Gorman
• Christopher Haynes
• Roger Higgins
• Martin Parkinson
• Emma Stein
• Juan Suárez Coppel
• Anne Templeman-Jones
• Wang Xiao Bin
• Sharon Warburton
• Chris Ashton (Chief Executive Officer and Managing Director)
Directors' shares and rights
As at the date of this report, the relevant interests of the
directors in the shares and rights of the Company were:
DIRECTORS
John Grill
Andrew Liveris
Thomas Gorman
Christopher Haynes
Roger Higgins
Martin Parkinson
Emma Stein
Juan Suárez Coppel
Anne Templeman-Jones
Wang Xiao Bin
Sharon Warburton
Chris Ashton
NUMBER OF
SHARES
NUMBER OF
RIGHTS
34,336,128
17,870
29,000
18,922
34,000
16,000
20,840
18,032
17,382
11,000
22,500
–
–
–
–
–
–
–
–
–
–
144,296
586,714
You'll find more details about the rights issued by the Company
in the Remuneration Report and notes 15 and 16 to the financial
statements.
The number of Board and standing Board Committee meetings held during the financial year, and the number of meetings each
director attended is below:
BOARD
AUDIT AND RISK
COMMITTEE
NOMINATIONS
COMMITTEE
PEOPLE AND
REMUNERATION
COMMITTEE
HEALTH, SAFETY
AND SUSTAINABILITY
COMMITTEE
MEETINGS
HELD
WHILE A
MEMBER
NUMBER
ATTENDED
MEETINGS
HELD
WHILE A
MEMBER
NUMBER
ATTENDED
MEETINGS
HELD
WHILE A
MEMBER
NUMBER
ATTENDED
MEETINGS
HELD
WHILE A
MEMBER
NUMBER
ATTENDED
MEETINGS
HELD
WHILE A
MEMBER
NUMBER
ATTENDED
John Grill
Andrew Liveris1
Thomas Gorman
Christopher Haynes
Roger Higgins
Martin Parkinson
Emma Stein2
Juan Suárez Coppel
Anne Templeman-Jones
Wang Xiao Bin
Sharon Warburton
Chris Ashton
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
6
7
7
7
7
7
6
7
7
7
7
6
4
6
6
6
1
5
4
6
6
6
1
We held special purpose Board Committee meetings and briefings during the financial year. The Board also attended regular
Board briefings. Due to COVID-19, most meetings convened virtually except for the June 2022 Board meeting which convened
in-person. All Non Executive Directors are invited to and have access to the papers for the standing Board Committee meetings.
During the financial year, the independent Non Executive Directors met on six occasions and the meetings were chaired by the Lead
Independent Director.
1 Andrew Liveris retired as a member of the Health, Safety and Sustainability Committee in February 2022.
2 Emma Stein was appointed as a member of the Health, Safety and Sustainability Committee in April 2022.
120
WorleyDirectors' Report Information on Directors and
Group Company Secretary
John Grill
AO, BSc, BEng (Hons), Hon DEng (Sydney),
Hon DEng (UNSW)
CHAIR AND NON EXECUTIVE DIRECTOR SINCE MARCH 2013
PREVIOUSLY CHIEF EXECUTIVE OFFICER AND MANAGING DIRECTOR
FROM LISTING IN NOVEMBER 2002 UNTIL OCTOBER 2012.
DIRECTOR OF THE COMPANY BEFORE LISTING AND DIRECTOR
OF ITS PREDECESSOR ENTITIES FROM 1971.
COUNTRY OF RESIDENCE – AUSTRALIA
John was appointed to the Board effective 1 March 2013. He
is Chair of the Board and Chair of the Nominations Committee,
a member of the People and Remuneration Committee and a
member of the Health, Safety and Sustainability Committee.
John has over 40 years’ experience in the resources and energy
industry, starting his career with Esso Australia. In 1971, he
became Chief Executive of Wholohan Grill and Partners, the
entity that ultimately became owned by Worley Limited. John
has expertise in every aspect of project delivery in the resources
and energy industry. He maintains strong relationships with
the Group’s major customers and was closely involved with the
Group’s joint ventures at Board level.
John was awarded an honorary doctorate by the University
of Sydney in 2010 in recognition of his contribution to the
engineering profession.
He was appointed an Officer of the Order of Australia in 2014
for distinguished service to engineering and business in the
minerals, energy and power supply industries, and as a supporter
of advanced education and training. In 2019, John was awarded
an honorary doctorate from the University of New South Wales.
John is also Chairman of the Mindgardens Alliance - a partnership
between the Black Dog Institute, Neuroscience Research
Australia (NeuRA), South Eastern Sydney Local Health District
(SESLHD) and the University of New South Wales.
Andrew Liveris
AO, BEng (Hons), PhD
DEPUTY CHAIR, LEAD INDEPENDENT DIRECTOR AND
NON-EXECUTIVE DIRECTOR – DIRECTOR SINCE SEPTEMBER 2018
COUNTRIES OF RESIDENCE – AUSTRALIA AND UNITED STATES
OF AMERICA
Andrew was appointed to the Board effective 5 September
2018. He is the Deputy Chair, Lead Independent Director and a
member of the People and Remuneration Committee and the
Nominations Committee.
Andrew is the former Chairman and Chief Executive Officer of
The Dow Chemical Company and the former Executive Chairman
of DowDuPont.
He had over 40 years’ global leadership experience with The Dow
Chemical Company with roles in manufacturing, engineering, sales,
marketing, business and general management around the world.
Andrew is a director of IBM, Saudi Aramco, The Minderoo
Foundation Pty Ltd - a modern philanthropic organization
that affects social change, and NOVONIX Limited - a company
supporting lithium-ion battery technologies. Andrew is the
President of Brisbane 2032 Organising Committee for the
Olympic Games (OCOG).
Andrew was formerly the Vice Chair of the Business Roundtable
and was the Chairman of the United States Business Council.
He has held previous Australian Government roles as Chair
of the National COVID-19 Coordination Commission (NCCC)
Manufacturing Taskforce and Co-Chair of the Territory Economic
Reconstruction Commission.
In 2012, Andrew co-founded The Hellenic Initiative (THI) to
support economic renewal in Greece through entrepreneurship,
business development and investment.
Andrew is a Chartered Engineer, a Fellow of the Institution of
Chemical Engineers and a Fellow of the Australian Academy
of Technological Sciences and Engineering (now Australian
Academy of Technology and Engineering). He earned a Bachelor's
degree (first class honors) in Chemical Engineering from the
University of Queensland and was awarded the University
Medal. In 2005, he was awarded an Honorary Doctorate in
Science by his alma mater and was named Alumnus of the Year.
He was appointed an Officer of the Order of Australia in 2014
for his services to international business and was awarded
an Honorary Doctorate in Engineering from Michigan State
University in 2015.
Australian listed company directorships
LISTED
COMPANY NAME
NATURE OF
DIRECTORSHIP
DATE OF
COMMENCEMENT
DATE OF
CESSATION
NOVONIX Limited
Non-Executive
Director
1 July 2018
n/a
121
Annual Report 2022 Thomas Gorman
BA, MBA, MA
NON-EXECUTIVE DIRECTOR – DIRECTOR SINCE DECEMBER 2017
COUNTRY OF RESIDENCE – UNITED STATES OF AMERICA
Thomas was appointed to the Board effective 18 December
2017. He is a member of the Health, Safety and Sustainability
Committee, the People and Remuneration Committee and the
Nominations Committee.
Thomas' appointment follows his 30-year career in executive
positions at Ford Motor Company and Brambles Limited. He
retired as Chief Executive Officer of Brambles in February
2017. He has worked in multiple functions including finance,
operations, logistics, marketing and business development
across the United States, England, France and Australia.
Thomas is a director of Orora Limited, Sims Limited and
Alcoa Corporation.
Thomas graduated cum laude from Tufts University with degrees
in Economics and International Relations. He obtained an MBA
with distinction from Harvard Business School and an MA in
International Relations from The Fletcher School of Law and
Diplomacy at Tufts University.
Australian listed company directorships
LISTED
COMPANY NAME
NATURE OF
DIRECTORSHIP
DATE OF
COMMENCEMENT
DATE OF
CESSATION
Orora Limited
Sims Limited
Non-Executive
Director
Non-Executive
Director
2 September 2019 n/a
15 June 2020
n/a
Christopher Haynes
OBE, FREng, BSc (Hons), DPhil, CEng,
FIMechE, FIEAust
NON EXECUTIVE DIRECTOR – DIRECTOR SINCE JANUARY 2012
COUNTRY OF RESIDENCE – UNITED KINGDOM
Christopher was appointed to the Board effective 1 January
2012. He is a member of the Health, Safety and Sustainability
Committee, the People and Remuneration Committee and
the Nominations Committee.
Christopher is a non-executive director of Woodside
Petroleum Limited.
Christopher had a 39-year career with the Shell Group of
Companies and their affiliates. He has lived in many countries,
122
working in oil and gas, LNG and chemicals businesses, primarily
in project development, delivery and operations. Christopher was
seconded to Woodside from 1999 to 2002 where he was General
Manager of the North West Shelf Venture. He then became
Managing Director of Shell’s operations in Syria and of Nigeria
LNG Limited. In 2008, Christopher assumed responsibility for
delivering Shell’s major upstream projects worldwide. He retired
from Shell in August 2011.
Christopher graduated from the University of Manchester with
a Bachelor of Science with honors in Mechanical Engineering.
He obtained a Doctor of Philosophy in Applied Sciences from the
University of Sussex. He is a Chartered Engineer and Fellow of
the Institution of Mechanical Engineers in the United Kingdom
and, in 2015, was elected a Fellow of the Royal Academy
of Engineering in the United Kingdom. He is a Fellow of the
Institution of Engineers, Australia.
Christopher was appointed to the Order of the British Empire
in June 2009 for his services to the British oil and gas industry
in Nigeria.
Australian listed company directorships
LISTED
COMPANY NAME
NATURE OF
DIRECTORSHIP
DATE OF
COMMENCEMENT
DATE OF
CESSATION
Woodside Energy
Group Ltd
Non-Executive
Director
1 June 2011
n/a
Roger Higgins
BE (Hons), MSc, PhD, FIEAust, FAusIMM
NON EXECUTIVE DIRECTOR – DIRECTOR SINCE FEBRUARY 2019
COUNTRY OF RESIDENCE – AUSTRALIA
Roger was appointed to the Board effective 20 February 2019.
He is Chair of the Health, Safety and Sustainability Committee
and a member of the Nominations Committee.
Roger’s experience is in mining and operations. He has previously
held senior executive positions with Teck Resources Limited,
BHP Billiton and Ok Tedi Mining Limited.
Roger is a non-executive director of Newcrest Mining Limited
and the Chair of Ok Tedi Mining Limited and Demetallica Limited.
He is an adjunct professor with the Sustainable Minerals
Institute at the University of Queensland.
Roger holds a Bachelor of Civil Engineering with honors from
The University of Queensland, a Master of Science in hydraulics
from the University of Aberdeen and a PhD in Water Resources
from the University of New South Wales. He is a Fellow of the
Institution of Engineers Australia and the Australasian Institute
of Mining and Metallurgy.
WorleyDirectors' Report Australian listed company directorships
LISTED
COMPANY NAME
NATURE OF
DIRECTORSHIP
DATE OF
COMMENCEMENT
DATE OF
CESSATION
Newcrest
Mining Limited
Non-Executive
Director
1 October 2015
n/a
Martin was awarded a Companion of the Order of Australia and
has a Public Service Medal. He is a Fellow of the Academy of
Social Sciences in Australia, the Institute of Public Administration
Australia and the Australian National Institute of Public Policy.
He is a life member of the Australian Business Economists.
Metminco
Limited
Minotaur
Exploration
Limited
Non-Executive
Director
Non-Executive
Director
Chairman
8 October 2013
16 August 2019
1 July 2016
25 February 2022
31 January 2017
25 February 2022
(acquired by
Andromeda
Metals Limited
and delisted)
Demetallica
Limited
Non-Executive
Director and
Chairman
16 December 2021
(ASX listed on
26 May 2022)
n/a
Martin Parkinson
AC, BEc, MEc, MA, PhD
NON-EXECUTIVE DIRECTOR – DIRECTOR SINCE FEBRUARY 2020
COUNTRY OF RESIDENCE – AUSTRALIA
Martin was appointed to the Board effective 24 February
2020. He is a member of the Audit and Risk Committee and the
Nominations Committee.
Martin is a director of O’Connell Street Associates, North
Queensland Airports and Champions of Change Coalition – a
group of executive leaders committed to achieving gender
equality and advancing women into leadership positions. Martin
is also the Chancellor of Macquarie University and Deputy Chair
of the Great Barrier Reef Foundation.
Martin previously served as Secretary for the Australian
Government's Department of the Prime Minister and Cabinet,
Australian Treasury and Department of Climate Change. Martin
is a former director of Orica, the Cranlana Program for Ethical
Leadership and the German-Australian Chamber of Industry
and Commerce. He has been a member of the Board of the
Reserve Bank of Australia, Infrastructure Australia, the Council
of Financial Regulators, the Board of Taxation and the Territory
Economic Reconstruction Commission. He was previously Chair
of the Australian Office of Financial Management.
Martin holds a PhD and an MA from Princeton University, an MEc
from the Australian National University and a BEc (first class
honors) from the University of Adelaide. Martin was awarded
the degree of Doctor of the University (honoris causa) by the
University of Adelaide.
Emma Stein
BSc (Hons), MBA, FAICD
NON EXECUTIVE DIRECTOR – DIRECTOR SINCE DECEMBER 2020
COUNTRY OF RESIDENCE – AUSTRALIA
Emma was appointed to the Board effective 10 December 2020.
She is Chair of the People and Remuneration Committee and a
member of the Health, Safety and Sustainability Committee and
Nominations Committee.
Emma currently serves as a non-executive director of Adbri
Limited.
Emma is a former non-executive director of Alumina Limited,
Cleanaway Waste Management Limited, Programmed
Maintenance Services Limited, Transfield Services Infrastructure
Fund, Clough Limited, the Diversified Utilities Energy Trust
(DUET) Group and Iberdrola Australia Limited.
Before moving to Australia in 2003, Emma gained international
experience in management and leadership, and strategy
development and implementation in global industrial, energy and
utilities markets. Her career included roles in strategic planning,
operational management in the fuels sectors and, specifically,
as UK Managing Director at Gaz de France Energy and UK Gas
Divisional Managing Director at British Fuels.
Emma holds tertiary qualifications in Science from the University
of Manchester and a Master of Business Administration (MBA)
from Manchester Business School. Emma is an Honorary
Fellow of the University of Western Sydney and a Fellow of the
Australian Institute of Company Directors.
Australian listed company directorships
LISTED
COMPANY NAME
NATURE OF
DIRECTORSHIP
DATE OF
COMMENCEMENT
DATE OF
CESSATION
Adbri Limited
Cleanaway Waste
Management
Limited
Alumina Limited
Non-Executive
Director
Non-Executive
Director
Non-Executive
Director
4 October 2019
n/a
1 August 2011
31 December
2020
3 February 2011
25 May 2021
Infigen Energy
Limited
Non-Executive
Director
21 September
2017
21 October 2020
(acquired by
Iberdrola and
delisted)
123
Annual Report 2022 Anne has a Master of Risk Management from the University
of New South Wales, an Executive MBA from the AGSM at the
University of New South Wales and a Bachelor of Commerce
from The University of Western Australia. She is a Chartered
Accountant and a Fellow of the Australian Institute of
Company Directors.
Australian listed company directorships
LISTED
COMPANY NAME
NATURE OF
DIRECTORSHIP
DATE OF
COMMENCEMENT
DATE OF
CESSATION
Commonwealth
Bank of Australia
Non-Executive
Director
5 March 2018
n/a
Blackmores Limited Non-Executive
28 October 2020
n/a
Director and Chair
GUD Holdings
Limited
Non-Executive
Director
The Citadel Group
Limited
Non-Executive
Director
1 August 2015
31 August 2021
8 September 2017 28 May 2020
Wang Xiao Bin
BCom, CPA, GDip
NON-EXECUTIVE DIRECTOR – DIRECTOR SINCE DECEMBER 2011
COUNTRY OF RESIDENCE – HONG KONG, CHINA
Xiao Bin was appointed to the Board effective 1 December 2011.
She is a member of the Audit and Risk Committee and the
Nominations Committee.
Xiao Bin is an executive director and Senior Vice President
of China Resources Power Holdings Company Limited and
non-executive director of Hang Seng Bank Limited. Xiao Bin
was previously a director of Corporate Finance (Asia Pacific)
at ING Investment Banking, responsible for execution of capital
markets and merger and acquisition transactions in the region.
She formerly worked at PricewaterhouseCoopers in Australia in
the Audit and Business Advisory division.
Xiao Bin has over 18 years' experience in the power industry
including its major shift towards a low-carbon future and
meeting industrial and consumer demand for clean, reliable and
affordable energy.
Xiao Bin qualified as a Chartered Accountant and Certified
Practising Accountant (CPA) in Australia. She holds a Bachelor of
Commerce from Murdoch University, Australia, and a graduate
diploma in Applied Finance and Investment from the Securities
Institute of Australia (now FINSIA).
Juan Suárez Coppel
BE, PhD
NON EXECUTIVE DIRECTOR – DIRECTOR SINCE MAY 2019
COUNTRY OF RESIDENCE – MEXICO
Juan was appointed to the Board effective 27 May 2019.
He is a member of the Audit and Risk Committee and the
Nominations Committee.
Juan has extensive experience in energy and resources in the
Americas. He was previously Chief Financial Officer and then
Chief Executive Officer of Petróleos Mexicanos (PEMEX). He was
also a senior executive with Grupo Modelo and an independent
non-executive director of Jacobs Engineering Group Inc.
During the 1990s, Juan was Chief of Staff to the Minister of
Finance, Mexico, a senior executive with Banamex (now Citi)
and Head of Corporate Finance and then Treasurer of Grupo
Televisa, Mexico.
Juan has a PhD in Economics from the University of Chicago.
During the 1980s, he held various academic roles. These include
as a full-time professor in the ITAM Department of Economics,
visiting professor at the Universidad Autónoma de Barcelona
Department of Economics and assistant professor at Brown
University in Rhode Island.
Anne Templeman-Jones
BCom, MRM, EMBA, CA, FAICD
NON EXECUTIVE DIRECTOR – DIRECTOR SINCE NOVEMBER 2017
COUNTRY OF RESIDENCE – AUSTRALIA
Anne was appointed to the Board effective 1 November 2017.
She is Chair of the Audit and Risk Committee and a member of
the Nominations Committee.
Anne is Chair of Blackmores Limited and non-executive director
of Commonwealth Bank of Australia and Cyber Security
Cooperative Research Centre.
Anne is a former non-executive director of GUD Holdings Limited,
The Citadel Group Limited, HT&E Limited, Cuscal Limited, HBF
Health Limited, Pioneer Credit Limited, TAL Superannuation
Fund, Notre Dame University and the McCusker Foundation for
Alzheimer’s Research.
Anne has executive experience in institutional and commercial
banking, wealth management, insurance, strategy and risk. She
previously held several senior executive roles in Switzerland and
Australia with PricewaterhouseCoopers, the Bank of Singapore
(OCBC Bank), ANZ and Westpac.
124
WorleyDirectors' Report Sharon Warburton
BBus, FCA, FAICD
Chris Ashton
BEng (Hons), MBA, MAICD
NON EXECUTIVE DIRECTOR – DIRECTOR SINCE FEBRUARY 2019
COUNTRY OF RESIDENCE – AUSTRALIA
Sharon was appointed to the Board effective 20 February
2019. She is a member of the Audit and Risk Committee and the
Nominations Committee.
Sharon has predominantly worked in the construction, mining
and infrastructure sectors. She is a Chartered Accountant with
experience in strategy and accounting, holding senior executive
positions at Rio Tinto, Brookfield Multiplex, Aldar Properties
PJSC, Multiplex and Citigroup.
Sharon is a non-executive director of Wesfarmers Limited,
Blackmores Limited and Northern Star Resources Limited and a
part-time member of the Takeovers Panel. She is an Independent
Director of Karlka Nyiyaparli Aboriginal Corporation RNTBC and is
also on the board of not-for-profit organization Perth Children’s
Hospital Foundation.
She was formerly the Co-Deputy Chairman of Fortescue Metals
Group Limited, Chairman of the Australian Government’s
Northern Australia Infrastructure Facility and a non-executive
director of NEXTDC Limited.
Sharon holds a Bachelor of Business (Accounting and Business
Law) from Curtin University. She is a Fellow of Chartered
Accountants Australia and New Zealand and the Australian
Institute of Company Directors.
Sharon was awarded the Telstra Business Woman of the Year
(Western Australia) in 2014 and was a finalist for The Australian
Financial Review’s Westpac 100 Women of Influence in 2015.
Australian listed company directorships
LISTED
COMPANY NAME
NATURE OF
DIRECTORSHIP
DATE OF
COMMENCEMENT
DATE OF
CESSATION
Wesfarmers Limited Non-Executive
1 August 2019
n/a
Director
Blackmores Limited Non-Executive
28 April 2021
n/a
Director
Northern Star
Resources Limited
Non-Executive
Director
1 September 2021 n/a
Gold Road Resources
Limited
Non-Executive
Director
9 May 2016
30 September
2021
Fortescue Metals
Group Limited
NEXTDC Limited
Non-Executive
Director
Co-Deputy
Chairman
Non-Executive
Director
13 November 2013
31 March 2020
8 November 2017
31 March 2020
1 April 2017
31 March 2020
CHIEF EXECUTIVE OFFICER AND MANAGING DIRECTOR
SINCE FEBRUARY 2020
COUNTRY OF RESIDENCE – UNITED STATES OF AMERICA
Chris was appointed Chief Executive Officer and Managing
Director on 24 February 2020.
Chris joined Worley in 1998 and has held many leadership
roles across the Company as it evolved through acquisition and
organic growth. Before becoming CEO, Chris was Chief Operating
Officer responsible for the integration of the ECR business and
setting the strategy for Worley’s transformation. Prior to this, he
was Group Managing Director for Major Projects and Integrated
Solutions with accountability for growth and performance.
This included Worley’s fabrication businesses, WorleyCord and
Rosenberg Worley, and the Global Delivery Center. He has also
held executive roles with responsibility for operations in Europe,
the Middle East and Africa and the power sector globally.
Chris holds a degree in Electrical and Electronic Engineering
with honors from the University of Sunderland and a Master
of Business Administration degree from Cranfield School of
Management. He has completed the Executive Management
Program at Harvard Business School and the Company Directors
Course at the Australian Institute of Directors.
Nuala O'leary
LLB, BA
GROUP COMPANY SECRETARY – APPOINTED AUGUST 2016
COUNTRY OF RESIDENCE – AUSTRALIA
Nuala was appointed Group Company Secretary in August 2016.
She is responsible for corporate governance for the Board and
the Group Executive.
Nuala is also responsible for the legal and governance matters
relevant to Worley Limited. These include the capital structure
and regulatory obligations, with Group accountabilities for
continuous disclosure. Nuala has a background in private legal
practice, specializing in corporate litigation and corporate
governance. Nuala holds degrees in Law and Arts from the
University of Sydney and a graduate diploma of Applied
Corporate Governance. Nuala is a Solicitor of the Supreme
Court of New South Wales.
125
Annual Report 2022 Remuneration Report
Audited
“We’re pleased with our performance outcomes and focus
on supporting our people and customers, while progressing
our journey to delivering a more sustainable world.”
Key messages from the Chair of the People and Remuneration Committee
Dear Shareholders,
On behalf of the Worley Board of Directors, I’m pleased to present
our Remuneration Report for the financial year ended 30 June 2022.
Our people are rising to the challenge
We’ve emerged from a period of unprecedented and challenging market
conditions. Customers and markets are evolving rapidly as they continue
to face new challenges, with complex problems to solve. Our people are
adapting, learning and innovating quickly. Through FY2022, they have
worked collaboratively to deliver some inspiring customer projects and
sustainability outcomes.
Changes to our Group Executive have further strengthened our
leadership to deliver our strategy. Our executives have the deep industry
experience, drive, and behaviors to lead our transformation. Along with
our CEO, they’re elevating our people and sustainability agendas – and
sharpening our focus on creating value for all our stakeholders.
Energized people are at the heart of our ambition
People that are energized and empowered to drive sustainable
impact are core to our strategy. We’re evolving our people strategies
to build our competitive advantage and accelerate growth. We need
best‑in‑class capabilities for our customers and to support our
growth in sustainability. We’re investing in skills of the future and
technical capabilities.
We’re building greater clarity on the cultural attributes that underpin our
transformation. Our values are the foundation, and we are integrating
these into everything we do. We are also developing leaders who create
meaning, embrace possibility and deliver what matters.
Our highest priority is to keep our people safe, healthy and feeling
included. We are proud of our industry‑leading safety performance.
During FY2022, we elevated our focus on well‑being and mental health.
We continue to build a diverse and inclusive workplace. We listen to
feedback from our people on inclusion and take actions to improve. Our
people network groups, such as Pride and KUUMBA, are strong. We are
actively leaning into important social issues, such as sexual harassment
and modern slavery.
We are navigating dynamic global markets for talent
We have a large global footprint. We have 51,300 people working across
more than 46 countries, who deliver for customers across thousands of
projects. The majority of our executives are located outside of Australia,
with a large number in the Americas.
The world is facing into unprecedented talent challenges presented
by skills shortages and wage pressures. Combined with business
growth, we need to be proactive to attract and retain the right people.
We see buoyant talent markets as an opportunity. Our authentic focus
on sustainability and the innovative opportunities we provide to work on
sustainable solutions are attractive. We’re engaging our existing people
with new learning and development opportunities and initiatives to
improve their experience.
We need competitive remuneration to attract, retain and engage
the talent needed to deliver our strategy in the markets in which we
operate. We’re particularly focused on having the right remuneration
strategy in the United States and other high‑growth sectors to be
competitive and help us grow. We use local industry benchmarking and
trend information to understand our different markets and anticipate
actions needed to compete.
Through COVID‑19, we have managed our cost base, and been
restrained when increasing remuneration. With growing talent risks,
we are elevating our attention on competitive and equitable fixed and
variable pay. Navigating wages growth, inflation and currency volatility
across many different country scenarios requires us to be agile, leverage
insights and partner with our customers.
Our executive remuneration strategy supports
our ambition
Remuneration strategy is aligned to what matters most. It’s strongly
linked to our strategy and purpose. It drives sustainable outperformance
and aligns with the interests of our shareholders. Our executives have
significant equity components in their remuneration ‑ to encourage
them to behave like owners, focus on building long‑term shareholder
value, and stay with us through business cycles. We’ve also used
equity grants proactively during FY2022 to recognize, engage and
retain critical people ‑ and we see this as an ongoing part of our
remuneration strategy.
We’ve continued to strengthen our focus on Environment Social and
Governance (ESG) through our remuneration framework and measures.
We’ve made changes to our Short‑Term Incentive (STI) plan, including a
greater weighting to ESG measures and formally incorporating behaviors
in line with our values. Our Deferred Equity Plan (DEP) is linked to the
growth of sustainability projects.
126
Worley We’ve changed the remuneration mix of our executives, increasing the
equity components to strengthen alignment with shareholders and
market practice. For our CEO, we’ve reduced the STI maximum from
200% to 150% of fixed salary and increased equity by a commensurate
amount (i.e. 50% of fixed salary). We increased deferred equity from
50% to 70% of fixed salary and Long Term Incentive (LTI) from 85% to
115% of fixed salary.
Remuneration outcomes reflect our performance
We’ve delivered improved performance in FY2022. We highlight the
following results for the Key Performance Indicators (KPIs) the Board
set in the STI business scorecard.
• We delivered an underlying Net Profit After Tax and excluding
Amortization (NPATA) result of $329m, which is 19% growth on
FY2021. This is the result of the significant achievements of the team:
managing costs, delivering projects well and winning new business.
• Our Days Sales Outstanding (DSO), which measures the time it takes
to collect cash from customers, met expectations.
• Our Safety outcomes continued to be strong, and our executives
demonstrated leadership in Health, Safety and Sustainability (HSS).
• We delivered significant reductions in Scope 1 and Scope 2 carbon
emissions – greater than the stretch target set.
• We made progress in diversity and inclusion.
• Our sales in sustainability projects, measured through gross margin
sold, are in line with our target.
To make decisions about FY2022 remuneration, we carefully reviewed
the performance results, compared to the stretch targets we set at the
beginning of the year. The Board reviews underlying earnings measures
for remuneration purposes to make sure executives are:
• Being appropriately held to account for their actions and delivering
the annual target; and
• Considering investment and transformational opportunities
without bias.
For FY2022, we used underlying NPATA for remuneration purposes in
line with the statutory accounts (refer to page 215). This excludes:
• Transformation and restructuring costs;
• Impairment of investments;
• The impact of our withdrawal from Russia; and
• The net impact of historical legal matters.
We have assessed individual performance, including both
‘what’ has been achieved and ‘how’ it was achieved. Our executives
have demonstrated strong leadership in line with our values to
deliver improved outcomes, inspire our people and create value
for our customers.
We also considered several factors to determine remuneration
outcomes for executives and the extent to which we would apply
any general Board discretion. This covered broader measures of
performance and outcomes for all our stakeholders. The Board believed
that, in considering the company wide achievements in 2022, the
increased STI business scorecard assessment, compared with 2021, was
justified and well deserved. The Board decided not to exercise discretion
to the STI business scorecard outcomes. We’ve used discretion to
make adjustments to individuals relating to the management of risk
and conduct.
As a result of the business and individual performance assessments,
the CEO will receive an STI payout of 96% of target. Other executive
KMP STI payouts will range from 67% of target to 102% of target.
The Board considers the overall STI outcomes are a fair reflection of
FY2022 performance.
Executives have successfully implemented our strategy over the past
two years. We are clear on our priorities and accelerating progress
in sustainability. This is demonstrated through the rapid growth in
business, generated through working on sustainable solutions with
our customers. We have grown our gross margin delivered, from
sustainability projects over the last two years. As a result, the Board
has determined that the FY2021 DEP will vest in full.
Our overall performance is improving, after two challenging years
of navigating business impacts of the COVID‑19 pandemic, economic
conditions and geopolitical issues. Total Shareholder Return (TSR) is
27.3% over the last 12 months. It is positive over the three years to
June 2022, at 17.5%. However, TSR relative to Worley peers was 35th
percentile over the same period. Earnings per Share (EPS) growth
was 0.3% per annum over three years, which was below threshold.
In line with the performance conditions, the Board has determined
that no LTI equity rights will vest. Full details of the outcomes are in
section 3 below.
Looking ahead to FY2023
We won’t make structural changes to the executive remuneration
framework in FY2023. However, we’ll review how we can better align to
our ambition – our People, our Portfolio and our Planet – through how
we assess executive performance and design our equity plans. We want
to make sure executive remuneration is motivating and focused on the
right levers to deliver value over the longer term.
We also need to make sure executive remuneration is competitive
in the key markets in which we compete for talent. We will review
executive remuneration levels in FY2023. This will include for the CEO,
whose fixed salary has remained the same since his appointment in
February 2020. The Board’s decision‑making process will consider his
demonstrated capability to lead a unique and complex global business
and his performance over the last few years. We will also continue to
review the value of our equity grants.
This is an exciting period for Worley. Our performance is improving, and
we are seeing strong signs of accelerating in the right areas. We have
a clear business strategy and significant opportunities to solve some
of the world’s most critical sustainability challenges for our customers
and broader stakeholders. We have a clear people strategy which is
focused on ensuring we have the right capabilities and creating the
right experience for our people. And we are confident that our purpose
– delivering a more sustainable world – our values and our leadership
will shape the right culture to deliver our strategy.
Finally, I want to thank you, our shareholders, for your support over
the year. I am pleased to engage with you all about the matters set
out in this report.
Warm regards,
Emma Stein
Chair, People and Remuneration Committee
127
Annual Report 2022 Contents
1. Key Management Personnel and leadership changes
2. Remuneration Report snapshot
3. Company performance and remuneration outcomes
4. Executive remuneration structure
5. Executive employment agreements
6. Non‑Executive Director remuneration
7. Remuneration governance
8. Remuneration tables (Statutory disclosures)
128
130
132
140
146
147
148
150
1. Key Management Personnel and leadership changes
1.1 Key Management Personnel
We’ve prepared this report in accordance with section 300A of the Corporations Act 2001 (Cth) (Act) and Accounting Standards.
It outlines our remuneration strategy for the financial year ended 30 June 2022 and gives detailed information on the remuneration
arrangements for Key Management Personnel (KMP). KMP are those who have authority and responsibility for planning, directing
and controlling the Group’s activities, either directly or indirectly.
The table below shows the KMP covered by the FY2022 Remuneration Report.
NAME
POSITION
TERM
COUNTRY OF RESIDENCE
Non-Executive Directors
Current
John Grill
Chair
Andrew Liveris
Non‑Executive Director and Deputy Chair
Juan Suárez Coppel
Thomas Gorman
Christopher Haynes
Roger Higgins
Martin Parkinson
Emma Stein
Non‑Executive Director
Non‑Executive Director
Non‑Executive Director
Non‑Executive Director
Non‑Executive Director
Non‑Executive Director
Anne Templeman‑Jones
Non‑Executive Director
Non‑Executive Director
Non‑Executive Director
Sharon Warburton
Wang Xiao Bin
Other executive KMP
Current
Chris Ashton
Mark Brantley
Full year
Full year
Full year
Full year
Full Year
Full year
Full year
Full year
Full year
Full year
Full year
Australia
Australia and
United States of America
Mexico
United States of America
United Kingdom
Australia
Australia
Australia
Australia
Australia
Hong Kong, China
Chief Executive Officer
Full year
United States of America
Group President – EMEA and APAC
From 1 November 2021
Netherlands
Tiernan O’Rourke
Chief Financial Officer
From 29 November 2021 Australia
Karen Sobel
Former
Vinayak Pai
128
Group President – Americas
Full year
Canada
Group President – EMEA and APAC
Until 31 October 2021
Netherlands
Worley Remuneration Report 1.2 FY2022 leadership changes
The operating model we announced in May 2020 has continued
to serve us well. It’s simplified how we engage with customers
and delivered work more effectively across the full asset
lifecycle. It positions us for growth in new sectors and increases
our focus on transformative trends, such as digitalization and the
energy transition.
We appointed Mark Brantley to lead Europe, Middle East, Africa
and Asia Pacific regions following the resignation of Vinayak Pai.
Following the retirement of Tom Honan, who stepped down
at the end of FY2021, Tiernan O’Rourke joined Worley in the
role of Chief Financial Officer (CFO). We appointed Charmaine
Hopkins to the CFO role on an interim basis from 22 June 2021
to 28 November 2021. Charmaine joined Worley in 2019 as
Executive Group Director, Corporate Finance. We do not consider
her a KMP for FY2022.
Karen Sobel led the Americas region over the last three years
and throughout FY2022. After nearly 10 years with Worley,
she announced her intention to retire, with an expected
retirement date in FY2023.
Karen moved into a new short‑term role on 1 July 2022. She is
fully eligible for STI and equity vesting in FY2022. She retains
her unvested equity rights and will be treated as a 'good leaver'
when her retirement date is confirmed.
Karen will be replaced by Mark Trueman on 1 July 2022. Mark
was previously Executive Group Director – Growth, responsible
for driving strategy development and sector leadership. Mark
joined Worley in 1994 and has led operations in numerous
locations over his career including Singapore and Latin America.
Mark is an exceptional leader, and we’re pleased that he will lead
the growth of the Americas business.
Vinayak Pai separation arrangements
Vinayak Pai resigned from Worley on 7 October 2021 and started
garden leave on 13 November 2021. His separation date was
31 December 2021. As part of his separation agreement, he
received statutory entitlements and benefits to support his
repatriation from the Netherlands. All unvested equity lapsed
as at the date of separation, and he is not eligible for FY2022 STI.
129
Annual Report 2022 Remuneration Report
2. Remuneration Report snapshot
Our remuneration framework principles
Be globally
competitive
A globally competitive and
consistent framework to attract,
motivate, retain and mobilize
diverse executives across
different countries.
Be clearly aligned
to our ambition
Clearly aligned to Worley’s
strategy, purpose, values and
risk appetite, with a transparent
link between performance
and reward. Assures external
stakeholders and engages
executives to drive the right
behaviors and outcomes.
Create strong
shareholder alignment
Incorporate significant equity
components to encourage
executives to behave like owners,
focus on building long‑term
shareholder value and stay with
Worley through business cycles.
Drive sustainable
outperformance
Provide meaningful incentives
to exceed stretch target
performance. Focus on
both short and long‑term
performance to deliver
sustainable value for our people,
customers, shareholders,
communities and planet.
STRUCTURE AND OPPORTUNITY
PURPOSE AND LINK TO STRATEGY
CHANGES IN FY2022
Fixed salary (cash) and benefits
Be market competitive to attract, motivate,
retain and mobilize executives.
We haven't changed our fixed salary
structure.
1 YEAR
Benchmarked against:
FIXED
COMPONENT
Fixed salary reflects the accountabilities and
expectations of the role and the executives'
experience, skills and contribution. Benefits
include retirement contributions (such
as superannuation) and items to support
international assignments.
• Global industry peer companies; and
• Australian companies with global
operations of similar size, complexity and
industry‑relevant peers.
We have been restrained with executive fixed
salary increases. The CEO has not received
a salary increase since his appointment in
February 2020.
Short-term incentive (STI)
Cash award paid for annual performance.
1 YEAR
Focus executives on delivering business
and individual performance. The business
scorecard comprises Key Performance
Indicators (KPIs) focused on financial,
ESG and strategic priorities. Individual
performance recognizes leadership in
executing our strategy and role‑modelling
behaviours in line with our values.
We set stretch targets which are over and
above day‑job expectations to motivate and
reward strong performance. Maximum STI
is only payable for outstanding performance
above and beyond already stretched targets.
We changed our STI plan in FY2022 as
follows:
1. A business scorecard comprising KPIs
that apply to all executives.
2. A consistent focus on financial KPIs
at 60%. Greater focus on ESG at 20%
(previously 10%).
3. Individual scorecards, comprising the
‘what’ (outcomes) and ‘how’ (HSS
leadership and behaviors).
4. Rewards differentiated for individual
performance.
VARIABLE
COMPONENT
Deferred equity plan (DEP)
Create strong shareholder alignment and
reward executives for strategy execution
achievements over the medium term.
We haven’t changed our DEP structure in
FY2022. We've kept the performance hurdle,
introduced from FY2021.
2 AND 3
YEARS
Equity rights with performance tested
over 2 years, and vesting in equal
tranches at years 2 and 3.
Be globally competitive to attract, motivate,
retain and mobilize executives.
Long-term incentive (LTI)
4 YEARS
Reward sustainable long‑term growth
in shareholder value, measured through
relative TSR and EPS growth.
Performance rights with performance tested
over 4 years, and vesting at 4 years.
We removed the additional Australian CPI
hurdle on the EPS performance condition for
the FY2022 grant and future grants as it did not
align to the global nature of our business. This
simplifies and clarifies the performance hurdle.
We introduced a new second TSR comparator
group, comprising companies that are more
aligned to our ambition strategy.
MINIMUM SHAREHOLDING REQUIREMENT (MSR)
Worley has robust shareholding requirements for both executives and Non‑Executive Directors (NEDs).
CEO: 400% of fixed salary, Other executives: 200% of fixed salary, NEDs: 100% of annual base fee
130
Worley Maximum variable remuneration and total remuneration
In FY2022, we changed the executive variable remuneration mix by reducing the maximum STI to 150% of target and increasing the DEP and LTI by a
commensurate amount. This improved the competitiveness of our equity and alignment to our comparator groups. This strengthens the alignment between
our executives and shareholders. Refer to section 4.2 for remuneration mix.
Total maximum remuneration ($’000)
CEO
CFO
Chris Ashton
FY2022
150%
FY2021
200%
Tiernan O’Rourke
FY2022
120%
Tom Honan
FY2021
160%
Group President,
EMEA and APAC
Group President,
Americas
Mark Brantley
Vinayak Pai
Karen Sobel¹
FY2022
120%
FY2021
160%
FY2022
120%
FY2021
160%
STI
(as a % of fixed salary)
DEP
LTI
70%
115%
50%
85%
55%
85%
40%
60%
55%
85%
40%
60%
55%
85%
40%
60%
7,395
7,395
3,780
3,911
2,112
3,222
2,730
2,481
1 Karen Sobel received an increase in fixed salary, effective 1 August 2021.
FY2022 STI outcomes
We’ve summarized STI outcomes below. You can find a detailed breakdown of outcomes in section 3.3.
Business scorecard
D
L
O
H
S
E
R
H
T
)
%
0
0
1
(
T
E
G
R
A
T
H
C
T
E
R
T
S
NPATA $329M
($277M in FY2021, 19% growth)
DSO 63 days
(68 days in FY2021)
48,211tCO2e Scope 1 and
Scope 2 carbon emissions
(29% reduction since FY2021)
0.06 SCFR
(0.07 in FY2021)
47% women graduates
(46% in FY2021)
16.3% women Senior Leaders
(16% in FY2021)
Progressed inclusion actions
Gross margin sold in sustainability projects was in line
with target
2 Maximum payout occurs at 100% of target for ESG and Strategic measures.
Overall business scorecard outcome 89%
Individual scorecard and STIs
We assessed individual performance (what has been achieved and
how it has been achieved). STI payouts are calculated as the business
scorecard outcome multiplied by individual outcomes.
Board discretion
We reviewed all outcomes and considered the quality of our overall
performance. As a result, we did not apply discretion to STI business
scorecard outcomes. We’ve used discretion to make adjustments to
individuals relating to the management of risk and conduct.
CEO STI: 96% of target Other Executive KMP STI: between 67% and 102% of target
FY2022 Equity vesting outcomes
We’ve summarized equity vesting outcomes below. You can find a detailed breakdown of outcomes in section 3.4.
DEP
GRANT NAME
PERFORMANCE
FY2020 Tranche 3
(Granted
October 2019)
FY2021 Tranche 1
(Granted
October 2020)
Time‑based only
14% growth in gross margin delivered
in sustainability projects over two years
which is above target. (70% weighting)
Delivered enhanced capabilities and
solutions (30% weighting)
VESTING
OUTCOME
100%
LTI
PERFORMANCE
Absolute TSR of 17.5%. 35th %ile rank against peer group
(Below threshold of 50th %ile)
100%
Underlying EPS Compound Annual Growth Rate
(CAGR) of 0.3%
(Below threshold of 4% p.a. plus CPI)
VESTING
OUTCOME
0%
0%
FY2020 LTI granted Oct 2019, performance measured July 2019 to June 2022.
131
Annual Report 2022FinancialESG2Strategic2
3. Company performance and remuneration outcomes
3.1 Overview of performance and remuneration outcomes
Underlying NPATA
$329M
35% sustainability
revenue
Absolute TSR 17.5%
35th percentile
over 3 years
Underlying EPS CAGR 0.3%
over 3 years
TSR trend over the last 5 years against the 50th and 75th
percentiles of the peer comparator group1
Underlying EPS2 v LTI vesting outcomes over the last 5 years
)
%
(
R
S
T
200
150
100
50
0
-50
Jul 17
Jul 18
Jul 19
Jul 20
Jul 21
Jul 22
125
100
75
50
25
0
d
e
t
s
e
v
s
t
h
g
i
r
S
P
E
I
T
L
%
25
20
15
10
5
0
-5
-10
-15
-20
-25
)
%
(
R
G
A
C
S
P
E
2018
2019
2020
2021
2022
Worley
50th Percentile
75th Percentile
EPS CAGR (%)
% LTI EPS rights vested
Underlying NPATA3 v STI outcomes over the last 5 years
TSR v LTI vesting over the last 5 years
100
i
d
a
p
I
T
S
f
o
%
80
60
40
20
0
419
329
277
239
171
125
100
75
50
25
0
)
n
o
i
l
l
i
m
$
(
A
T
A
P
N
/
T
A
P
N
d
e
t
s
e
v
s
t
h
g
i
r
R
S
T
I
T
L
%
500
400
300
200
100
0
125
100
75
50
25
0
-25
-50
)
%
(
R
S
T
2018
2019
2020
2021
2022
NPATA
($million)
% of target
STI paid
% of max
STI paid⁴
Jul 17
Jul 18
Jul 19
Jul 20
Jul 21
Jul 22
TSR %
Payout outcome
1 We’ve used the comparator group for the FY2020 LTI grant.
2
EPS CAGR is calculated, based on underlying NPATA for grants made from FY2020, and underlying NPAT prior to FY2020. This excludes the additional CPI hurdle, required
to determine vesting.
For STI purposes, we measured earnings for FY2018 and FY2019 using underlying NPAT. From FY2020, we use underlying NPATA for remuneration purposes.
The FY2020 NPAT result was $338 million. The FY2021 NPAT result was $202 million. The FY2022 NPAT result was $258 million.
3
4 Maximum STI payout was 150% of fixed salary for FY2017, FY2018 and FY2019. In FY2020 and FY2021, it was 200%. From FY2022, we have reverted to 150%.
132
Worley Remuneration Report
The tables below summarize the Group’s performance for FY2022 and the previous four years in respect of the key financial indicators
the Board identified to assess our performance and determine variable remuneration outcomes.
Financial performance
Table 3.1.1
CATEGORY
Earnings
MEASURE
20182
20192
20203
FY ENDING 30 JUNE
Underlying NPAT ($million) 1
Underlying NPATA ($million) 1
Underlying NPAT EPS (cents)
Underlying NPATA EPS (cents)
Shareholder value
Share price ($)2
Dividends paid (cents)
171
182
62.4
66.2
17.63
25
239
260
57.3
62.2
14.71
27.5
338
419
64.9
80.4
8.77
50
20213
202
277
38.6
53.0
11.90
50
ANNUALIZED
GROWTH OVER
FIVE YEARS
10.76%
15.95%
(5.77%)
(1.31%)
(5.3%)
18.9%
2022
258
329
49.2
62.8
14.16
50
1 From FY2020, financial measures for earnings are based on underlying NPATA for remuneration purposes. The measure changed from NPAT to NPATA, following the
acquisition of ECR, to make sure remuneration continues to focus on operational performance.
2 The closing share price is shown for FY2018 and FY2019. From FY2020 onwards we show the 5 Day Volume Weighted Average Price (VWAP) to 30 June. The closing price
in FY2017 was $11.22.
3 For FY2020 and FY2021 we have restated Underlying NPAT and NPATA results. For details refer to Note 2E of the Financial Report.
Variable remuneration outcomes
Table 3.1.2
CATEGORY
MEASURE
STI
Average % of target STI paid to executive KMP
Average % of maximum STI paid to
executive KMP1
DEP2
Performance period (years)
Payout outcome
LTI EPS3
Performance period (years)
EPS % achieved4
Payout outcome5
LTI Relative TSR3
Performance period (years)
TSR % achieved
Relative TSR percentile achieved6
Payout outcome
TESTED FY ENDING 30 JUNE
2018
24.8%
16.5%
n/a
n/a
4
2019
53%
35%
n/a
n/a
4
(11.9%)
(12.6%)
nil
4
13.0%
65.0
80%
nil
4
47.6%
76.2
100%
2020
65%
33%
n/a
n/a
3
9.7%
100%
4
3
2021
71%
35.5%
n/a
n/a
3
(14.8%)
nil
3
40.0%
71.4
92.9%
(11.4%)
(18.7%)
50.0
50%
46.2
nil
2022
88.4%
59.0%
2
100%
3
0.3%
nil
3
17.5%
35.0
nil
1 Maximum STI payout was 150% of fixed salary for FY2018 and FY2019 and 200% for FY2020 and FY2021, and 150% for FY2022.
2 Commencing with the FY2021 DEP grant, we’ve included a performance hurdle that is assessed after two years. Equity rights vest 50% at year two and 50% at year three.
Refer to section 3.4.2 for more detail.
3 Performance period changed from 3 years to 4 years from the FY2021 LTI grant (tested in June 2024).
4 For FY2020 and FY2021, we have recalculated the EPS percentage achieved based on the earnings restatement for those years. For details refer to Note 2E of the
Financial Report. Note also, in prior years we have reported the EPS % achieved above CPI. From FY2022, we are reporting EPS % achieved, excluding CPI, for all years.
5 The payout outcome for FY2020 was calculated on the EPS outcome at the time, prior to the restatement. The payout outcome following the restatement would have
been 99.1%
6 Worley’s TSR performance is measured relative to Worley’s peer group for each grant.
133
Annual Report 2022 3.2 FY2022 fixed and total remuneration changes
The Board reviews the total remuneration levels of executives every year. This makes sure pay reflects competitive benchmarking
and the experience and capability of individuals – and that there’s an appropriate balance between fixed and variable remuneration.
Refer to section 4 for more information.
At the beginning of COVID‑19, we addressed all aspects of our cost base and have been restrained with increasing remuneration
levels. The remuneration of our CEO was no exception, and his fixed salary has not changed since his appointment in February 2020.
However, we increased Karen Sobel’s fixed salary by 10% on 1 August 2021 to improve the competitiveness of her total remuneration,
compared to local and global benchmark data.
Through our benchmarking, we identified that cash incentive opportunities were higher than market, and equity was lower.
Equity targets were not competitive against global peer companies. We therefore decided to:
• reduce the maximum STI from 200% to 150% of target. There’s no change to the STI target opportunity. This is more aligned to
Australian market practice and shareholder expectations.
• increase the DEP and LTI opportunity levels by a commensurate amount with the majority weighted towards increasing the LTI.
This change enhances the focus on creating shareholder value over the medium and long term. It also recognizes that adding the
DEP performance condition and longer timeframes, introduced in FY2021, make it tougher for executives to realize value.
The shift from cash (STI) to equity (DEP and LTI) strengthens the alignment of our remuneration mix to both the Australian and global
comparator groups, and between executives and shareholders. In rebalancing the remuneration mix, there was no change to total
incentive opportunity levels at maximum. This is despite a greater portion of remuneration being geared towards longer deferral
periods. The pay mix retains the overall proportion of pay ‘at risk’.
3.3 STI outcomes
In FY2022, we implemented an STI framework which has:
• a shared business scorecard of annual financial, ESG and strategic KPIs, aligning executives to key priorities in transforming and
growing Worley.
• greater focus on ESG priorities, which builds on our commitment to HSS.
• an individual scorecard comprising the 'what’ – personal KPIs – and the 'how’ – personal HSS leadership and demonstrating
behaviors aligned to Worley values. This is critical to our culture and transformation.
• differentiated rewards for individual performance. These recognize when our executives outperform, or when they don’t meet
expectations. This incentivizes executives to go beyond targets and role‑model the behaviors we expect.
The individual scorecard outcomes can modify the business scorecard outcome to determine the individual STI payout. Refer to
section 4.1 for more on how the STI works.
X
X
X
=
FIXED
REMUNERATION
STI TARGET
OPPORTUNITY
BUSINESS
SCORECARD
INDIVIDUAL
SCORECARD
THE 'WHAT'
AND 'HOW'
OVERALL STI
OUTCOME
MIN 0% - MAX 130%
OF TARGET DISCRETION +/-
MIN 0% – MAX 125%
OF TARGET
CAPPED AT A MAX OF
150% OF TARGET
134
Worley Remuneration Report 3.3.1 Business scorecard
We assess performance for each business scorecard KPI based on actual outcomes compared to performance levels defined below.
Our KPIs are our priorities and our targets are stretch. Refer to section 4.4.1 for further information on how we assess STI outcomes.
PERFORMANCE LEVEL
MINIMUM
TARGET
MAXIMUM
Definition
This is a threshold level of performance.
Performance at this level typically
requires sustained effort.
This is a stretch level of performance.
Performance at this level is challenging
yet achievable with effort.
This an outstanding level of
performance. Performance at this
level is very challenging.
Payout
0%
100%
150% Financial KPIs
100% ESG and strategic KPIs
For FY2022, ESG KPIs focused on reducing carbon emissions, safety performance and progressing our diversity and inclusion
objectives. Our strategic KPI focused on growing new business in sustainability projects. The table below shows the results.
Table 3.3.1.1
MEASURE
Financial1
TARGET DESCRIPTION
WEIGHTING
MIN
TARGET
MAX
FY2022 PERFORMANCE
Underlying NPATA
Deliver budget
DSO
65 days
50%
10%
Environment, Social and Governance2
Scope 1 and Scope 2
carbon emissions
Safety
Reduce tonnes of carbon emitted
Serious case frequency rate (SCFR)
within range
Diversity and inclusion
17% of women Senior Leaders
20%
50% of women hires in total global
graduate intake target
Progress against agreed inclusion actions
Strategic 2
New business (gross margin
sold) in sustainability projects
Deliver sales plan to grow new business
20%
The Board did not apply discretion to business scorecard outcomes.
WEIGHTED
PAYOUT
OUTCOME
41.4%
11.2%
18.0%
18.4%
1 The maximum STI payout on financial measures is capped at 150% of target. We would typically award this for performance of 120% or greater of target.
2 The maximum STI payout on ESG and Strategic KPIs is 100% of target.
FY2022 Business Scorecard Outcome: (% of target) 89.0%
(% of max) 59.4%
135
Annual Report 2022 Business scorecard explanatory notes
Table 3.3.1.2
MEASURE
DEFINITION AND ADJUSTMENTS
Underlying NPATA
Net Profit After Tax excluding the post‑tax impact of amortization of intangible assets
acquired through business combinations. Underlying means the profit result after
adjusting for significant/non‑operational items that are not considered part of our
sustainable performance. We included all project and operational related provisions.
We used underlying NPATA for remuneration purposes in line with the statutory
accounts (refer to page 215). This includes strategic investment costs, and excludes:
• Transformation and restructuring costs;
•
Impairment of investments;
• The impact of our withdrawal from Russia; and
• The net impact of historical legal matters.
We reviewed the volatility and impact of actual currency movements compared to
budget. We factored this into underlying earnings for remuneration purposes.
PERFORMANCE COMMENTS
Underlying NPATA was below our stretch
target, at $329m. However, it represents
a growth of 19% on FY2021. This is
the result of significant achievements:
managing costs, delivering projects well
and winning new business.
DSO
Days Sales Outstanding is a measure of the time taken to collect cash from customers. DSO was 63 days across the Group. This
Carbon emissions
Measured as reduction of Scope 1 and Scope 2 tonnes of carbon emitted. For further
information, refer to page 216.
met expectations and is an improvement,
compared to FY2021.
Carbon emissions were measured at
48,211tCO2e which is above the stretch
target we set. This is largely due to
significant renewable energy switching of
our operations.
Safety
Measured as a Serious Case Frequency Rate (SCFR). A serious case is a fatality or
permanent disabling injury/illness, or event with the potential to result in a fatality or
a permanent disabling injury or illness. The frequency rate is based on the number of
cases per 200,000 hours worked and is a 12‑month rolling average.
Safety (SCFR) was 0.06. This is within
the range set. Our leaders were proactive
to create the right environment for
good safety outcomes.
% of women
Senior Leaders
We use our Organizational Role Framework (typically tiers one to three) to define
senior leader roles. This includes our Group Executive and any managers below them
who have leadership accountabilities for business units (profit and loss) and functions.
We’ve been challenged to increase the
number of women in senior leader roles.
The percentage has held steady against
FY2021 at 16%.
% of women hired in
total global graduates
Target a minimum of 50% women hires to support gender diversity in the general
workforce.
47% of our graduate hires were women.
This is below the stretch target.
Inclusion action plan
Progress in global action areas following inclusion survey results:
• Building leadership capability in inclusion and belonging.
• Review of fairness of people policies and practices.
• Supporting our people network groups, who act for our under‑represented
people, including women, Black and Latinx, our LGBTIQ+ community, people
with disabilities, and more.
New business in
sustainability
Measured as Gross Margin Sold in defined sustainability pathways (decarbonization,
resource stewardship, asset sustainability, environment and society).
Progress made across all areas.
Highlights are:
•
• Areas identified to improve fair
Inclusion training delivered for leaders.
decision‑making about our people.
• Strengthened effectiveness of people
network groups.
New business (Gross Margin Sold) in
sustainability was materially in line with
the target we set. This was a stretch
target, incorporating significant growth.
3.3.2 Discretion
We will apply discretion and adjust the business scorecard outcomes if the Board believes they do not appropriately reflect
performance. To determine the impact of any discretion, the Board considers the quality of our financial performance and other
significant Company performance outcomes and risks. This covers finance, operations and ESG (including safety), as well as outcomes
for our stakeholders (people, customers, shareholders, suppliers and communities). Refer to section 4.4.1 for further information.
We believe that, in considering the achievements in 2022, the increased business scorecard assessment, compared with 2021, was
justified and well deserved. We decided not to exercise discretion to the business scorecard outcomes.
136
Worley Remuneration Report 3.3.3 Individual scorecards and STI outcomes
The individual scorecard comprises financial, ESG and/or strategic KPIs. These are aligned with the individual’s area of accountability,
personal leadership and the behaviors we expect. The KPIs include quantitative and qualitative measures and indicators.
We differentiate these from the targets in the business scorecard to make sure we don’t reward executives twice against the
same outcomes.
We have clear behavioral expectations, aligned to our values of Life, Rise to the challenge, Unlock brilliance and Stronger together.
The Board assess executive performance and determine individual scorecard modifiers considering the outcomes and evidence of
behaviors demonstrated. In FY2022, we’ve used discretion to make adjustments to individuals relating to the management of risk
and conduct.
Provided below is a summary of the individual scorecard assessment for the CEO.
NAME
Chris Ashton
INDIVIDUAL
SCORECARD
%
107.5%
KEY PERFORMANCE COMMENTS
FY2022 was a key year for Worley to emerge from the pandemic in a healthy position; where Worley is rising to
the challenges of the energy transition to create value for all stakeholders. Chris’s leadership and performance has
been strong in positioning Worley to reap the benefits. Key highlights are:
• He has created a bold and compelling ambition that has galvanised our people, and successfully led the
development of a clear strategy around our moves in sustainability and portfolio rationalization.
• There is demonstrable progress and momentum in delivering on our strategy as we enter FY2023. Worley is
viewed as a market leader in the sustainability domain, and Chris's engagement with our customers and broad
stakeholder groups has created and supported this progress.
• He has progressed the development of our culture to deliver our strategy. This includes embedding our purpose
and values; as well as setting clear leadership expectations. He has elevated the diversity and inclusion agenda
throughout Worley to unlock performance and innovation.
• He is bringing greater focus and discipline to how we manage risks, and instigated the risk uplift program. He
has also improved our information technology landscape and the management and protection of data, and he
has strengthened security in our digital environment.
The table below shows the individual scorecard outcomes and actual STI amounts we’ll pay the CEO and other executive
KMP for FY2022.
Table 3.3.3.1
NAME
CHIEF EXECUTIVE OFFICER
Chris Ashton
OTHER EXECUTIVE KMP
Tiernan O’Rourke3
Mark Brantley3
Karen Sobel
STI OUTCOMES
BUSINESS
SCORECARD %
(A)
INDIVIDUAL
SCORECARD %1
(B)
TOTAL AS A
% OF TARGET
(AXB = C)
ACTUAL STI
AWARDED
$0002
MAXIMUM
POTENTIAL STI
$000
STI PAID
AS A % OF
MAXIMUM
STI FORFEITED
AS A % OF
MAXIMUM
89.0%
107.5%
95.7%
1,626
2,550
63.8%
36.2%
89.0%
89.0%
89.0%
115.0%
100.0%
75.0%
102.4%
89.0%
66.8%
504
483
405
739
815
910
68.2%
59.3%
44.5%
31.8%
40.7%
55.5%
1 Individual scorecard % can range between 0% ‑ 125%.
2 This refers to the FY2022 STI plan which is typically paid to executives in October 2022.
3 Mark Brantley's and Tiernan O'Rourke's STI outcomes are pro‑rated for the period they were KMP in FY2022.
137
Annual Report 2022 3.4 FY2022 equity outcomes
We make all equity grants in the form of performance rights under the Worley performance rights plan rules. Performance rights are
sometimes called equity rights. They’re rights to Worley shares which we deliver to participants if they achieve vesting conditions,
such as time and performance requirements. Details of individual vesting outcomes can be found in sections 8.3 and 8.4.
3.4.1 FY2020 Deferred Equity Plan (DEP) outcomes (Tranche 3)
The FY2020 DEP is a grant of restricted equity rights which vest and convert to shares in equal tranches over one, two and three
years. Vesting is subject to clawback and malus conditions and continued satisfactory individual performance.
Following the vesting of the first two tranches in September 2020 and 2021, the third and final tranche will vest on 30 September
2022. The share price used for the grant was $12.50, and the share price on 30 June 2022 was $14.16. This reflects a 13% increase in
the share price since grant.
3.4.2 FY2021 DEP
The FY2021 DEP is a grant of restricted equity rights which vest and convert to shares in two equal tranches over two and three years.
Vesting is subject to a performance hurdle which we measure at the end of two years. Vesting is also subject to continued service and
individual performance.
WEIGHT
KPI
PERFORMANCE MEASURE
RESULT
70%
30%
Growth in value from
customer sustainability
projects.
Deliver enhanced
capabilities and solutions.
Growth in gross margin delivered in sustainability
projects, measured from June 2020 to June 2022.
14% growth, which is greater than
the target.
Action 1: Complete strategy development by June
2021 and deliver outcomes by June 2022 in line with
Board expectations.
Action 2: Embed Sustainable Solutions process with
customers. Apply on large and mega projects, and
new projects with moderate or high‑risk levels for
operational carbon emissions in FY2022.
Significant progress in executing our
strategy. We are focusing on the right
growth areas and gaining traction
with our customers.
We are embedding sustainable
solutions with our customers.
WEIGHTED
OUTCOME
70%
30%
The Board reviewed performance outcomes against KPIs set and determined that 100% of the grant will vest. This is the maximum
vesting outcome.
50% of the grant (the first tranche) will vest on 30 September 2022. The share price used for the grant was $9.66, and the share price
on 30 June 2022 was $14.16. This reflects a 47% increase in the share price since grant. The remaining 50% of the grant (the second
tranche) is scheduled to vest in 2023, subject to all other vesting conditions being met.
3.4.3 FY2020 Long-Term Incentive (LTI) outcomes
We measured performance over a three‑year period, ending 30 June 2022, and tested against two equally weighted performance hurdles:
1. Relative TSR: The percentile ranking of our absolute TSR, relative to a global group of peer companies (as outlined in the FY2019
Notice of Meeting): AECOM, Aker Solutions, Arcadis, Bilfinger, EMCOR Group Inc, Flour Corporation, Fugro, Jacobs Engineering Group,
JGC, KBR, McDermott International Inc, Petrofac, Quanta Services Inc, Saipem, SNC Lavalin, Stantec, Technip, Tetra Tech, Wood Group
and WSP Global; and
2. Earnings per share: The CAGR of our underlying NPATA EPS, compared to a performance target inclusive of the Australian Consumer
Price Index (CPI).
We have set out the vesting outcomes under each of these measures below.
Table 3.4.3.1
PLAN
PERFORMANCE
MEASURE
FY2020 LTI
EPS1
RESULT
0.3% p.a.
PROPORTION OF
GRANT VESTED
COMMENT
nil
Our underlying EPS CAGR over three years was 0.3%, compared to a threshold of 4% p.a.
EPS growth plus CPI CAGR over the same period of 3.2%. This results in nil vesting.
Relative TSR
35th percentile
nil
Our absolute TSR was positive at 17.5%, however we ranked in the 35th percentile,
compared to our peer group. This results in nil vesting.
1
For remuneration purposes, we calculate EPS using underlying NPATA as this focuses executives on growth in operating profit. For grants prior to FY2020, we used underlying NPAT.
138
Worley Remuneration Report 3.5 Remuneration received by executive KMP during FY2022
The table below gives a summary of the remuneration received by executive KMP during the performance periods ended 30 June 2021
and 30 June 2022. We believe that presenting this information to shareholders gives them greater clarity and transparency. This table
also differs from the statutory remuneration table on page 150 which presents remuneration in accordance with accounting standards.
We’ve explained the remuneration executives received relating to their performance for FY2022 below.
A. Fixed salary
Comprises base salary plus superannuation or retirement contributions, paid for FY2022.
B. Cash STI
Comprises accrued cash STI for FY2022.
C. Equity grants
We include the value of all equity grants vesting on 30 September 2022. For FY2022, this includes the third tranche of the
FY2020 DEP grant and the first tranche of the FY2021 DEP grant.
Executives must remain employed to the vesting date or be a good leaver to be eligible for them. The actual value will depend
on the share price at exercise.
D. Benefits
Local benefits provided in line with market practice, including annual leave accruals, and items to support international
assignments, such as medical insurance, tax equalization and housing allowances.
E. Termination benefits
Includes any statutory entitlements and paid garden leave where applicable.
Table 3.5.1
NAME
YEAR
FIXED
SALARY
$000
(A)
CASH STI
$000
(B)
EQUITY
GRANTS1,2
$000
(C)
BENEFITS
$000
(D)
TERMINATION
BENEFITS
$000
( E)
TOTAL
REMUNERATION
RECEIVED
$000
= A + B + C + D + E
PERFORMANCE
RELATED
REMUNERATION
$000
= B + C
EXECUTIVE DIRECTORS
Chris Ashton
OTHER EXECUTIVE KMP
Tiernan O’Rourke3
Mark Brantley4
Karen Sobel5
Vinayak Pai (former)6
FY2022
FY2021
1,707
1,707
1,626
1,206
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
588
504
–
–
524
483
–
768
676
355
918
–
405
375
–
463
754
110
–
–
240
–
302
81
–
328
Total remuneration
FY2022
3,942
3,018
1,296
FY2021
3,301
2,044
519
71
32
46
–
128
–
20
22
127
170
392
224
–
–
–
–
–
–
–
–
151
–
151
–
4,158
3,055
1,138
‑
1,375
–
1,495
1,154
633
1,879
8,799
6,088
2,320
1,316
504
723
707
456
–
791
4,314
2,563
1 We valued the FY2021 equity grants using the 5 Day VWAP up to and including 30 June 2021, $11.90.
2 We valued the FY2022 equity grants using the 5 Day VWAP up to and including 30 June 2022, $14.16
3 Tiernan O’Rourke commenced with Worley on 29 November 2021. He was granted FY2022 equity on a pro‑rata basis. He did not receive any equity grants or cash awards
to replace remuneration forfeited by his prior employer.
4 Mark Brantley commenced in the role of Group President – Europe, Middle East, Africa and APAC on 1 November 2021. His remuneration is shown only for this period.
5 Karen Sobel received a 10% increase in fixed salary effective 1 August 2021.
6 Vinayak Pai ceased to be a KMP on 31 October 2021 and terminated employment on 31 December 2021. He received benefits to support his international assignment to
the Netherlands from August 2019 and his return to India at the end of his employment with Worley, as well as pay out of accrued leave benefits. He received a gratuity
payment of $41,800 upon termination in line with statutory requirements in India. Salary paid during the period of his garden leave is also shown as part of his termination
benefit. He isn’t eligible for an STI payment for FY2022 and forfeited all unvested equity rights as of his last day of employment.
139
Annual Report 2022
4. Executive remuneration structure
We’ve developed the remuneration framework to support our strategy and drive sustainable outperformance. It supports our purpose,
values, strategic objectives and risk appetite.
Our remuneration framework must be globally competitive to attract, motivate, retain and mobilize top talent across countries.
It creates strong shareholder alignment by incorporating significant equity components. These encourage executives to behave like
owners, focus on building long‑term value and stay with us through business cycles.
We’re on a journey to transform both what we deliver for our customers and how we do it. We’re focused on growing our business
with our customers in sustainability, building on our capabilities and technology solutions. We’re also committed to creating a more
sustainable organization through care for our planet, care for our people and communities, and operating responsibly.
These considerations are reflected in the actions we took to evolve elements of our executive remuneration framework in FY2022.
We’ve provided more information below.
4.1 Benchmarking
The Board reviews the total remuneration levels
of executives every year. This makes sure that pay
levels reflect competitive benchmarking and the
experience and capability of individuals, and that
there is an appropriate balance between fixed and
variable remuneration.
Our benchmarking approach considers the size and
nature of our business and the global talent markets
we operate in. We consider individual role benchmarks,
location of the executive, economic and wages
environment and trends in executive remuneration.
Benchmarking data and trend information provides
insights that help us remain competitive in setting
fixed and variable remuneration for our executives.
We’ll continue to review these annually as our global
peer companies evolve.
We’ve outlined our current benchmark comparator groups below.
Our global comparator groups are:
1. Specific peer companies in our TSR comparator group
under our LTI (see table 4.4.3); and/or
2. Companies of similar size in the energy, chemicals
and resources sector in the key markets in which
we operate (as relevant for each executive) notably
North America, the UK and Europe.
Our Australian comparator groups are:
ASX companies that operate in the energy, materials or
industrial sector with a market capitalization between
50% to 200% of our market capitalization, and those with
similar global operations and complexity to our business.
4.2 Remuneration mix
This graph shows the mix of pay opportunity
at minimum, target and maximum performance.
Most executive reward is variable and at
risk. We incorporate high levels of equity‑based
remuneration to create strong shareholder alignment.
Maximum values for equity are the face value of
equity rights at 100% vesting. Target values for equity
are the face value of equity rights at 100% vesting for
DEP and 50% vesting for LTI.
CEO
Min
100%
Target
30.5%
Max
23.0%
Other executive KMP
Min
100%
Target
36.0%
Max
27.8
Fixed salary
30.5%
34.5%
21.4%
17.6%
16.1%
26.4%
28.8%
33.3%
STI
19.8%
15.3%
15.3%
23.6%
DEP
LTI
140
Worley Remuneration Report 4.3 Fixed remuneration
Fixed remuneration gives our executives a competitive fixed salary (cash) and benefits. Fixed salary reflects the accountabilities
and expectations of the role. We set fixed salary in relation to market conditions and relevant benchmarks. It also reflects individual
factors such as the executive’s experience, capability, performance and potential.
We give fixed salary in the form of cash base salary or allowances, retirement contributions and any salary‑sacrificed components.
Executives are eligible for certain benefits in line with the policies of their local Worley employer. Our benefits comply with local
legislation. They are locally competitive to attract and retain executives and support their well‑being. Typically these include
retirement contributions (such as statutory superannuation) and basic insurances (such as disability, life and medical) where it is local
market practice. We may also provide benefits to support the global mobilization of executive talent. We aim to have competitive
global mobility policies and support the safety and well‑being of our people and their families.
4.4 Variable remuneration
Our executive remuneration framework has three variable components (STI, DEP and LTI). This clearly distinguishes the performance
focus of each component, as outlined in the diagram below.
Performance focus
Key performance indicators
Payout
YEAR 1
YEAR 2
YEAR 3
YEAR 4
STI (cash)
Running and growing
our business
• Financial
• ESG
• Strategic priorities
• Value (gross
margin) from
customer
sustainability
projects
DEP (equity rights)
Transforming Worley by
executing our strategy
LTI (equity rights)
Creating sustainable
shareholder value
• Annual cash payment
• 0 – 150% of target
• Value based on share price
• Performance test at year 2
• 0 – 50% vesting at year 2
• 0 – 50% vesting at year 3
• Relative TSR
• EPS growth
• Value based on share price
• Performance test at year 4
• 0 – 100% vesting at year 4
141
Annual Report 2022 4.4.1 Short-Term Incentive – STI
In FY2022, we evolved the STI framework to strengthen our sustainability focus and enable our transformation. We’ve outlined the
STI plan we implemented in the table below.
FEATURE
DESCRIPTION
Purpose and link
to strategy
Opportunity
The STI plan focuses the CEO’s and other executives’ efforts to deliver financial, ESG and strategic priorities relevant to the financial
year. The plan motivates executives to achieve stretch targets and rewards them for outperformance.
Annual STI targets are set at 100% of fixed salary for the CEO and 80% of fixed salary for other executive KMP. To receive a target STI
payout, executives must fully achieve the stretch KPI targets. The maximum STI payable is 150% of target. This can only be achieved
through exceptional financial performance and Board discretion.
Eligibility
All executives are eligible to participate in the STI plan. To be eligible for a payment, executives generally need to have been employed
for at least three months of the financial year and be employed at the date of payment.
Delivery
Cash.
Performance period
1 year.
Setting performance
conditions and targets
The Board sets the annual KPIs and performance levels (minimum, target and maximum) at the start of the financial year. The Board
has oversight of the KPIs to ensure they are robust. Executives need to achieve a high minimum (threshold) level of performance
before we pay any STI. KPI targets represent a stretch level of performance over and above day‑job performance. The Board sets
a maximum level of performance for financial targets to pay up to 150%. Performance must be outstanding at this level.
Performance
conditions
We measure performance through a business scorecard which applies to all executives, and an individual scorecard with specific
individual measures:
In the business scorecard, we measure performance through a mix of financial, ESG and strategic KPIs. This makes sure we select
measures that are fundamental to the long‑term sustainability and transformation of the business.
• Financial KPIs (60% weighting): comprising of underlying NPATA (50%) and DSO (10%). These KPIs focus executives on annual
operating profit and cash collection.
• ESG KPIs (20% weighting): aligned to areas such as climate actions, sustainability, safety, diversity and inclusion and
risk management.
• Strategic KPIs (20% weighting): priorities that will have the most impact on our transformation. We may measure performance
by quantitative outcomes or qualitative indicators which need more judgement.
The business scorecard has a formulaic approach with defined metrics and targets for performance levels. Weighting exists for all
KPIs except ESG KPIs. The Board will determine an outcome for the entire ESG component, considering the performance of each
KPI against the targets set.
The individual scorecard may comprise financial, ESG and/or strategic KPIs, aligned with the individual’s area of accountability. They
include clear quantitative and qualitative measures and indicators. They’re differentiated from the targets in the business scorecard
to make sure we don’t reward executives twice against the same outcomes.
The individual scorecard also includes expectations for:
• HSS leadership; and
• Behaviors in line with our values: Life, Rise to the challenge, Unlock brilliance and Stronger together.
142
Worley Remuneration Report FEATURE
Performance
assessment
and payout
DESCRIPTION
At the end of the financial year, the People and Remuneration Committee and the Board assess achievement against each KPI and
compare the results to the performance targets set at the beginning of the year. To do this, they receive guidance and input from
other Board Committees.
The Board reviews underlying NPATA for remuneration purposes to make sure executives are:
• being held to account for their actions and delivering the annual target; and
• considering potential acquisitions or investment and transformational opportunities for their strategic importance to Worley
and not the impact on their remuneration outcomes.
For the NPATA KPI, the minimum performance is 80% of budget or target. For performance between minimum and target, for
each 1% performance above 80%, the payout is an additional 5%. Above target, the payout is an additional 2.5% until the cap of
150% (which is for the maximum of 120% achievement against budget or target).
For the DSO KPI, the minimum performance is 110% of the target number of days outstanding. For performance above minimum,
a sliding scale applies to determine the payout.
The ESG and strategic KPIs, which are typically non‑financial measures, have a maximum payout of 100% of target.
The executives’ individual scorecard outcome can modify the business scorecard outcome by 0% to 125%. We cap the final STI
outcomes at a maximum of 150%. The People and Remuneration Committee and the Board assess individual scorecard outcomes,
compared to the KPIs set at the beginning of the year, and evidence of behaviors demonstrated to determine the individual
scorecard modifier. The Board may determine an adjustment to the individual scorecard outcome relating to risk or conduct.
Board discretion
The People and Remuneration Committee and the Board assess the funding available for the STI plan, and the extent to which they
apply discretion to the STI outcomes. They consider significant factors, such as those below, which are over and above performance
measured in the business scorecard.
CATEGORY
Finance
Operations
EXAMPLE CONSIDERATIONS
Quality of earnings and forecasting, strength of balance sheet and cashflow management.
Performance of internal controls, digital security and risk management.
Health and Safety
Any adverse health and safety outcomes over and above the SCFR outcomes
People
Planet
Customers
Shareholders
Voluntary attrition, experience of our people, Code of Conduct breaches.
Supporting our customers in reducing their CO2 intensity, environmental and
community responsibility.
Customer satisfaction, including any undesired loss of major accounts/projects.
Dividend payouts, reputational damage negatively impacting share price.
In reviewing our performance, the People and Remuneration Committee and the Board consider:
• Guidance and recommendations from external stakeholders, including proxy advisors such as ASIC, Australian Institute
of Company Directors (AICD) and legislative bodies in the markets we operate in.
• Feedback from our people, customers, suppliers, shareholders and communities we operate in.
• Consultation with independent external advisors as necessary.
This approach makes sure STI outcomes are appropriate and reflect performance and mitigates against unintended outcomes.
The Board believes this approach is rigorous, objective and comprehensive.
Our STI framework applies to all eligible executives. We set ambitious stretch targets and work to make sure our performance and
reward assessment is fair and transparent.
143
Annual Report 2022 4.4.2 Deferred Equity Plan - DEP
The following table summarizes the DEP granted in FY2022:
FEATURE
DESCRIPTION
Purpose and link
to strategy
Opportunity
Eligibility
The DEP attracts, motivates and retains executives across multiple countries. Using deferred equity rights is globally competitive,
particularly in the United States where we have nearly half of our executives and business. The DEP aligns executives with
shareholder interest and focuses them on the long term. It also helps executives to achieve the above Australian market standard
MSR.
We set annual DEP targets at 70% of fixed salary for the CEO and 55% of fixed salary for other executives.
All executives are eligible to participate in the DEP. To be eligible for a grant, they generally must have been employed at the
beginning of the performance period, i.e. 1 July, prior to the grant.
Delivery
Deferred equity rights. Each deferred equity right that vests entitles executives to one Worley share.
Performance period
2 years. The deferred equity rights vest in two equal tranches at two and three years. For the FY2022 grant, the rights will vest in
September 2023 and September 2024.
Number of deferred
equity rights
We determine the number of equity rights by dividing the executives' target DEP value, as at 1 July 2021, by the VWAP of shares over
the 10 trading days immediately following the day we released our FY2021 financial results. For the FY2022 grant, this was $10.55.
Summary of
performance
condition
We assess the DEP against one or more strategic execution KPIs. These measure progress in increasing contribution to delivering
a sustainable world. This is fundamental to Worley’s strategy to deliver growth and shareholder value and help our customers to
achieve their sustainability goals.
The Board will determine the outcome of the strategic execution condition at the end of the performance period, having regard to
the results against the KPI(s). The Board considers the quality of the result to make sure the outcome is appropriate and reflects
performance. We believe this mitigates against unintended outcomes. The Board determines a nil, partial or full vesting. Any rights
that don’t vest aren’t retested and lapse immediately.
We’ve summarized the KPI for the FY2022 grant below:
WEIGHT
100%
KEY PERFORMANCE INDICATOR
Growth in gross margin delivered from customer projects in the defined sustainability pathways.
The KPI is a quantifiable and measurable target. Performance against the KPI, including the rationale for the vesting percentage,
will be disclosed in the Remuneration Report following the end of the performance period. The vesting of equity rights is also
subject to individual malus and clawback provisions. Refer to section 7.6.
Leaver provisions
Equity rights vest subject to the executive remaining an employee of the Group on the vesting date and their satisfactory
performance up until that time. In certain circumstances, the Board may exercise its discretion and allow a good leaver
to retain their unvested equity rights. We’ve outlined this further in section 7.7.
144
Worley Remuneration Report 4.4.3 Long-Term Incentive (LTI)
The following table summarizes the LTI granted in FY2022.
FEATURE
DESCRIPTION
Purpose and link
to strategy
Opportunity
Eligibility
The LTI focuses the CEO and other other executive KMPs efforts to create sustainable long‑term value. It rewards executives for creating
sustained shareholder wealth above that of peer companies in our industry, and absolute long‑term earnings performance above a
minimum threshold.
It also encourages executives to stay with Worley and promotes alignment with shareholders’ interests.
We set an annual LTI grant value of 115% of fixed salary for the CEO and 85% for other executive KMP. This represents the current face
value of equity should they fully achieve their stretch performance targets. The value ultimately received by executives will depend on
the Worley share price at the time of vesting.
All executives are eligible to participate in the LTI. To be eligible for a grant, they generally must have been employed at the beginning
of the performance period, i.e. 1 July before the grant.
Performance rights. Each performance right that vests entitles executives to one Worley share.
Delivery
Performance period 4 years.
Number of
performance rights
Summary of
performance
conditions
We determine the number of rights granted by dividing a percentage of an executive's fixed salary, as at 1 July 2022, by the VWAP of
shares over the 10 trading days immediately following the day we released our financial results for FY2021. For the FY2022 grant,
this was $10.55.
We assess the LTI against two equally weighted, independent performance targets: relative TSR and EPS.
Relative TSR performance hurdle – 50% weighting
The TSR measure represents change in the value of our share price over a period including reinvested dividends. This is expressed as
a percentage of the opening value of the shares. We chose relative TSR because we believe this provides the most direct measure of
shareholder return. It also reflects an investor’s choice to invest in Worley or our direct competitors. Executives will only derive value
from the TSR component of the LTI plan if our TSR performance is at least at the 50th percentile of companies in the peer comparator
group over a four‑year period.
There is no retesting opportunity for the long‑term equity under the relative TSR measure. The vesting schedule of the rights subject
to the relative TSR hurdle is as follows:
RELATIVE TSR PERCENTILE RANKING
Less than 50th percentile
At 50th percentile
Greater than the 50th percentile but less than the 75th percentile
At 75th percentile or greater
PERCENTAGE OF RIGHTS THAT MAY BE EXERCISED
IF THE RELATIVE TSR HURDLE IS MET
0%
50%
Pro‑rated vesting between 50% and 100%
100% (i.e. maximum available under the plan)
For FY2022, relative TSR is measured against two separate peer groups with an 80%/20% weighting:
• a select peer group of companies that compete against Worley for customers, people and projects today (80% weighting).
The peer group for FY2022 includes Aker Solutions, Fluor Corp, KBR, Petrofac, SNC Lavalin, Technip Energies and Wood; and
• a second peer group comprising companies aligned to our strategy of delivering value to customers in sustainability pathways
by leveraging knowledge, technology and digital solutions (20% weighting). The peer group for FY2022 is AECOM, Arcadis, Jacobs,
Parsons, Stantec, Sweco, Tetra Tech and WSP Global.
We have an independent external consultant calculate the TSR result. This provides assurance that the outcome is free from influence
of participants. The Board can adjust the peer comparator group to take into account events that happen during the performance period,
for example, takeovers, mergers or demergers.
EPS growth performance hurdle – 50% weighting
To measure EPS, we divide the Group underlying NPATA by the weighted average number of Worley's ordinary shares on issue during the
financial year. To measure growth in EPS, we compare the EPS in the financial year immediately preceding the grant with the EPS in the
measurement year. The Board chose EPS growth because it provides a clear line of sight between executive performance and Worley's
financial performance. It’s also a well‑recognized and understood measure within and outside the organization. The Board may adjust
the Group underlying NPATA used for remuneration purposes, where appropriate, to better reflect operating performance.
From FY2022, we removed the additional Australian Consumer Price Index (CPI) hurdle to simplify measurement and stay relevant to
the global nature of our business. Executives will only derive value from the EPS growth component of the grant made during FY2022 if
Worley achieves compound annual growth in EPS of at least 4% per annum over the four‑year performance period. The vesting schedule
of the rights subject to the EPS growth hurdle is as follows:
EPS ANNUAL COMPOUND GROWTH
Less than 4% p.a.
4% p.a.
More than 4% p.a. but less than 8% p.a.
8% p.a. or greater
PERCENTAGE OF RIGHTS THAT MAY BE EXERCISED
IF THE EPS HURDLE IS MET
0%
50%
Pro‑rated vesting between 50% and 100%
100% (i.e. maximum available under the plan)
Leaver provisions
The Board retains full discretion to determine and calculate the vesting outcomes. The vesting of equity rights is also subject to individual
malus and clawback provisions. Refer to section 7.6.
Performance rights vest subject to the executive remaining an employee of the Group on the vesting date and their satisfactory
performance up until that time. In certain circumstances, the Board may exercise its discretion and allow a good leaver to retain their
unvested performance rights. We’ve outlined this further in section 7.7.
145
Annual Report 2022 5. Executive KMP employment agreements
We have outlined the key aspects of executive contracts below:
CONTRACT DURATION
NON-COMPETE CLAUSES
NOTICE PERIODS
EXECUTIVE DIRECTOR
Chris Ashton
OTHER EXECUTIVE KMP
Tiernan O’Rourke
Mark Brantley
Karen Sobel
Vinayak Pai (former)
Unlimited
Unlimited
Unlimited
Unlimited
Unlimited
6 months
6 months
6 months
12 months
6 months
6 months
6 months
6 months
6 months
6 months
The executive KMP contracts include the components of remuneration which we pay. The contract includes an annual review but
doesn’t prescribe how we’ll modify remuneration levels from year to year.
If we terminate a KMP executive’s contract, they’re generally entitled to their statutory leave entitlements. If a KMP executive resigns,
we only pay their variable pay if they’re employed on the date of payment or vesting (which is after the performance year).
In certain circumstances, the Board may decide to allow a good leaver to retain eligibility to variable pay. We’ve outlined this further
in section 7.7.
146
Worley Remuneration Report
6. Non-Executive Director remuneration
We set NED fees at a market competitive level to attract and retain the high caliber of directors we need to address the strategic and
operational challenges our business faces. The Board reviews NED fees each year to compare them to fees paid by other ASX listed
companies of similar size, industry and global scope. It also considers the number of NEDs we need for the business. During FY2022
no changes were made to the NED fee policy. Fees have remained the same since 1 July 2019.
There’s a cap on the fee amount we can pay to NEDs in any year (these include Board and Committee fees). Our shareholders approve
this cap. The current maximum aggregate amount is $3.25 million per annum, set at the 2012 AGM. We paid 90% ($2.91 million) of the
aggregate fee pool during FY2022, compared to 85% ($2.76 million) in FY2021. This includes FY2022 travel expenses of $45,000.
In FY2022, there were no changes to Board membership overall. However, during the 2021 AGM (effective date 4 November 2021)
Thomas Gorman retired as People and Remuneration Committee Chair. He was replaced by Emma Stein. In February 2022 Andrew
Liveris retired as a member of the HSSC, and Emma Stein was appointed as a member of the HSSC in April 2022.
Table 6.1
COMPONENT
EXPLANATION AND DETAIL
Board fees
We pay competitive Board fees to attract and retain high‑caliber directors and provide appropriate remuneration for roles.
There were no changes to NED fees in FY2022. Board fees (inclusive of superannuation where relevant) are:
ROLE
Chair
Lead Independent Director
Other NED base fee
FEE P.A.
$520,000
$269,000
$194,000
The Chair and Lead Independent Director roles have fixed fees. They don’t receive additional fees for being a member of any
committees.
Committee fees
Committee fees recognize the additional responsibilities, time and commitment required.
The annual committee fees are:
ROLE
Chair of Audit and Risk Committee
Member of Audit and Risk Committee
Chair of People and Remuneration Committee
Member of People and Remuneration Committee
Chair of Health, Safety and Sustainability Committee
Member of Health, Safety and Sustainability Committee
Chair/Member of Nominations Committee
FEE P.A.
$47,000
$26,000
$40,000
$21,000
$40,400
$21,000
nil
Other benefits
NEDs are eligible for allowances of $5,000 per trip for additional time incurred on overseas business travel.
This includes attending Board meetings and site visits. We make these payments from the NED fee pool.
NEDs are also entitled to a reimbursement for all business expenses, including travel, they incur while working.
We don’t pay retirement benefits to NEDs unless required to by legislation. NEDs do not receive any
performance‑related incentive, such as equity rights. From time to time, the Board may determine
special fees for additional duties directors undertake.
We’ve set out the remuneration outcomes of the NEDs for FY2022 and FY2021 in section 8.5 on page 154. We've detailed the NED
beneficial interests in Worley shares, as at 30 June 2022, in section 8.6 on page 155.
147
Annual Report 2022 7. Remuneration governance
The diagram below shows the process we follow to make remuneration decisions and explains the roles various stakeholders play:
Board
• Makes sure remuneration policies and structures are competitive, fair and aligned with the
long-term interests of Worley;
• Sets and approves remuneration structures; and
• Approves the amount of remuneration for the CEO, other executives and NEDs.
Nominations
Committee
• Reviews and assesses the CEO’s
performance.
• Advises the Board on the CEO’s
remuneration – including:
• amount;
• structure; and
• applicable performance targets.
Audit and
Risk Committee
Helps and advises the Board with:
• Risk issues, conduct and/or
compliance matters that may affect
remuneration outcomes; and
• the financial targets and results,
including any qualitative overlay and
adjustments for remuneration
purposes.
Health, Safety
and Sustainability
Committee
Helps and advises the Board with:
• defining ESG KPIs relating to safety
and sustainability; and
• assessing safety and sustainability
performance and KPI outcomes.
People and
Remuneration
Committee
Helps and advises the Board with:
• remuneration structure and policies;
• NED remuneration;
• executive performance assessment
and remuneration and, where required,
engages independent advisors for
advice on remuneration structure
and amounts for the CEO,
other executives and NEDs;
• aligning remuneration framework and
outcomes with Worley's purpose,
culture and risk appetite; and
• culture and values, diversity and
inclusion strategies and targets, and
leadership succession.
External market data
and external consultants
We source market data from published reports and independent
surveys. If required, the People and Remuneration Committee
seeks independent advice on the quantum and structure of
remuneration. In these situations, the remuneration advisor
engages directly with the People and Remuneration Committee
Chair. The People and Remuneration Committee or Board use
advice and information as a guide only and are responsible for
all decisions.
Management
• CEO recommends pay increases and variable pay
outcomes for the executives (other than the CEO) at the
request of the Nominations Committee or the People and
Remuneration Committee.
• Provides information relevant to remuneration
decisions and, if appropriate, liaises with advisors to
help the relevant committee with factual information.
• The Board makes all decisions about executive
remuneration. If appropriate, however, Management is
included in the People and Remuneration Committee
and Board discussions.
During FY2022, KPMG and Pearl Meyer gave market practice information and advice. This did not include remuneration
recommendations. The People and Remuneration Committee is satisfied that the information KPMG and Pearl Meyer provided
was free from undue influence by any executive.
148
Worley Remuneration Report 7.1 Minimum shareholding requirement (MSR)
Executives are required to meet an MSR to:
• reinforce our objective of aligning executives to shareholders
and encouraging them to behave like owners; and
• increase focus on building long‑term shareholder value.
To satisfy the requirement, executives must retain equity they
received through incentive plans until their holding is equivalent
in value to two times their fixed salary (or four times fixed salary
for the CEO). They must maintain that multiple. The value of their
holding includes all Worley shares held plus 50% of the value of
unvested rights. Table 8.2.1 on page 151 shows a summary of
the position of each executive on 30 June 2022.
We require NEDs to hold an MSR to align NED and shareholder
interests. Each NED must build a holding of the Company’s
ordinary shares that’s equivalent to the annual NED base fee.
NEDs are expected to comply with this within their first full term
of three years as a director. Table 8.6.1 on page 155 shows a
summary of the position of each NED on 30 June 2022. For the
purposes of this test, we’ve calculated the value of shares using
the number of shares held at 30 June 2022 multiplied by the
five‑day VWAP of the Company’s shares, up to and including
30 June 2022 ($14.16), or purchase price if higher.
7.2 Other equity provisions
Equity rights we grant to executives under our equity plans carry:
• no voting or dividend entitlements; and
• no entitlement to participate in new share issues made by the
Company other than bonus issues and capital reorganizations
(when the Board may adjust the number of rights in
accordance with the ASX Listing Rules, to make sure there’s
no advantage or disadvantage to the executive).
7.3 Exercise of equity rights and allocation
of shares
Once an executive has satisfied their performance hurdles, their
equity rights are automatically exercised and they acquire shares
at a nil exercise price. Where an executive has a tax withholding
obligation on vesting, we may withhold shares equal to the value
of the tax and social security obligations. We then pay the value
directly to the relevant tax authority on the executive’s behalf.
Shares allocated to an executive upon exercise of rights rank
equally with all other ordinary shares on issue. Where the
shares are subject to further vesting conditions or restriction
periods (i.e. they are restricted shares), they can’t be sold
before the vesting date or end of the restriction period (as
applicable). They may still be forfeited in certain circumstances.
After vesting, participants have unencumbered ownership of
the shares, subject to complying with the Company’s Securities
Dealing Policy and MSR.
7.4 Dilution limit
The Board has determined that the number of securities we
issue under our equity plans should be capped at 5% of the
issued share capital of the Company over a five‑year period.
Currently, the number of securities issued and held in accordance
with the equity plans represents 2.77% of the Company’s issued
share capital (FY2021: 2.36%).
7.5 Hedging
Under our Securities Dealing Policy, directors and executives are
not permitted to hedge unvested performance rights or shares
that count towards their MSR. This makes sure executives:
• can’t limit the risk associated with these instruments; and
• are subject to the same fluctuations in share price as all other
shareholders.
7.6 Clawback and malus provisions
These provisions within the variable pay plans enable the
Board to claw back or lapse an employee’s unvested equity
rights (or their vested but unexercised equity rights) if they
believe the employee:
• has acted fraudulently or dishonestly,
• is in breach of their obligations to the Company or another
Group Company, including those outlined in Worley’s
Code of Conduct,
• received grants based on financial accounts which were
later restated; or
• is responsible, through negligence or intentional disregard
for procedures and policy, for a serious event that resulted
in, or had the potential to result in, significant harm to people
or our environment.
7.7 Cessation of employment
Our policy for termination benefits and entitlements treats
leaving executives fairly and in accordance with the law and
market practice. The policy covers discretions that the Board
may exercise, which we’ve summarized below. At the 2019 AGM,
shareholders approved this policy to continue this approach,
keeping us globally competitive.
Where an executive leaves, the Board may exercise its discretion
to determine the executive's eligibility to retain some or all of
a cash incentive or unvested equity rights. The Board will also
decide the basis (that is the conditions, timing and so on) on
which any payment or vesting occurs. The Board will consider
relevant factors including an assessment of the executive’s
contribution and performance. The Board generally exercises
this discretion only in circumstances such as permanent
disability, retirement and redundancy. This is known as being
a good leaver.
149
Annual Report 2022 The Board may allow the executive to retain a portion of any cash incentive and outstanding unvested equity rights. We typically
determine the portion on a pro‑rata basis and consider the time the executive was employed during the performance period. Any cash
incentive paid is subject to Worley's performance and the executives’ performance. Retained unvested equity rights are subject to the
applicable performance and time vesting requirements. The Board believes this discretion is in our best interests.
7.8 Change of control
The Board will exercise its discretion to determine whether to vest any or all unvested equity rights in the event of a change of control
of the Company (where a third party unconditionally acquires more than 50% of the issued share capital of the Company).
Pro‑rata performance against applicable performance hurdles, up to the date of the change of control, would be considered.
8. Remuneration tables (Statutory disclosures)
We have presented all remuneration in Australian dollars in the following statutory tables.
8.1 Statutory remuneration outcomes
We’ve detailed executive KMP remuneration in the following table in accordance with accounting standards. Accounting standards
require us to amortize the accounting value of equity granted over the relevant performance or vesting period. The table below
includes the annual accounting values. We determine the target annual value of equity, as a percentage of fixed salary, that Worley
aims to deliver. We’ve outlined the current targets in section 4. We’ve outlined the face value of equity grants vesting to executive
KMP, for performance to 30 June 2022, in table 3.5.1.
Table 8.1.1
NAME
YEAR
EXECUTIVE DIRECTOR
CASH
SALARY
$000
CASH
INCENTIVE/
CASH STI 1
$000
OTHER
BENEFITS 2
$000
TOTAL
SHORT TERM
CASH AND
BENEFITS
$000
SUPER-
ANNUATION
BENEFITS
$000
LONG
SERVICE
LEAVE
$000
TERMI-
NATION
BENEFITS
$000
EQUITY
INCENTIVE3
$000
LTI EQUITY
SETTLED3
$000
TOTAL
REMUNER-
ATION IN
ACCORDANCE
WITH
ACCOUNTING
STANDARDS
$000
VARIABLE
PAY % OF
TOTAL
REMUNER-
ATION
%
Chris Ashton4
FY2022
1,692
1,626
FY2021
1,707
1,206
OTHER EXECUTIVE KMP
Tiernan O'Rourke5
FY2022
576
Tom Honan (former)5
FY2021
1,069
Mark Brantley6
Karen Sobel7
FY2022
FY2021
FY2022
FY2021
Vinayak Pai (former)8
FY2022
FY2021
515
–
753
662
326
855
Total remuneration
FY2022
3,862
FY2021
4,293
504
616
483
–
405
375
–
463
3,018
2,660
71
32
36
9
3,389
2,945
1,116
1,694
128
1,126
–
20
22
127
170
382
233
–
1,178
1,059
453
1,488
7,262
7,816
15
–
12
22
9
–
15
14
29
63
80
99
–
10
18
–
–
10
18
735
410
117
310
253
–
270
174
(159)
442
1,216
1,336
–
–
–
151
151
–
669
448
4,808
3,803
63.0%
54.3%
52.7%
54.9%
57.1%
54.0%
50.6%
1,341
2,478
1,521
–
1,712
1,413
168
(276.8%)
2,191
50.3%
9,550
9,885
86
434
133
–
249
166
(306)
198
831
1,246
The amount relates to the FY2022 STI plan, typically paid to executives in October 2022.
1
2 This includes expatriate benefits (such as housing, home leave and tax advisory services) and local benefits (such as health insurance, car parking, company cars or car allowances,
fringe benefits tax, and life insurance). In some cases, these are at the election of the executives, i.e. they are salary sacrificed. From FY2021, we have included the net movement
in annual leave accrual.
3 This remuneration includes a proportion of the fair value of equity remuneration granted or outstanding during the year. The fair value of equity is based on the fair value at grant
date. It is expensed progressively over the vesting period. The amount included as remuneration isn’t indicative of the benefit (if any) that individual executives may ultimately
realize should the performance rights vest. Equity incentive includes grants made under the DEP and any other special performance grants made from time to time.
4 Chris Ashton was granted 112,796 DEP and 185,308 LTI rights as part of his FY2022 remuneration package under the Performance Rights Plan. This was approved at the 2021
Annual General Meeting, under ASX Listing Rule 10.14.
5 Tom Honan retired on 21 June 2021. Tiernan O'Rourke commenced with Worley on 29 November 2021. He was granted FY2022 equity on a pro‑rata basis. He did not receive any
equity grants or cash awards to replace remuneration forfeited by his prior employer.
6 Mark Brantley commenced in the role of Group President ‑ EMEA and APAC on 1 November 2021. His remuneration is shown only for this period.
7 Karen Sobel received a 10% increase in fixed salary effective 1 August 2021.
8 Vinayak Pai ceased to be a KMP on 31 October 2021 and terminated employment with Worley on 31 December 2021. He forfeited all unvested equity rights. For all equity
forfeited upon his termination, we have reversed the full equity expense accrued over the lifetime of each grant. Vinayak received some expatriate benefits to support the end of
his assignment and return to his home country of India (flights, tax support, shipping). He also received a statutory gratuity entitlement of $41,800. Salary paid during his period
of garden leave is included as a termination benefit. Other benefits includes payment for accrued leave, paid out on termination.
150
Worley Remuneration Report 8.2 Executive KMP minimum shareholding requirement
We assess compliance with our MSR following 30 June each year. The table below gives a summary of the position of each executive
KMP as at 30 June 2022.
Table 8.2.1
NAME
EXECUTIVE DIRECTOR
Chris Ashton
OTHER EXECUTIVE KMP
Tiernan O’Rourke
Mark Brantley
Karen Sobel
WEIGHTED
NUMBER
OF SHARES 1
VALUE OF
SHARES HELD
(AUD) 2
ANNUAL
FIXED SALARY
(AUD)
PERCENTAGE
OF MINIMUM
SHAREHOLDING
REQUIREMENT
ACHIEVED
%3
437,655
$6,486,515
$1,700,000
95.4%
40,880
104,213
124,737
$578,861
$1,050,000
$1,475,656
$1,766,276
$736,986
$756,270
27.6%
>100%
>100%
1 Includes Worley shares held plus 50% of unvested performance rights provided in table 8.3.1 below.
2 Calculated as the weighted number of shares held at 30 June 2022 multiplied by the higher of the VWAP over the five trading days to 30 June 2022 ($14.16) or the price at
which the performance rights or shares were acquired.
3 To satisfy the requirement, executives must retain equity granted to them by Worley until their holding is equivalent in value to two times their fixed salary (or four times
fixed salary for the CEO).
8.3 Executives' interests in shares and performance rights
We’ve detailed beneficial interests in shares and performance rights as at 30 June 2022 in the table below. We discuss the service and
performance criteria for the equity grants vesting in FY2022 in section 4 from page 140.
Table 8.3.1
NAME
TYPE
BALANCE AT
1 JULY 2021
PERFORMANCE
RIGHTS
GRANTED
PERFORMANCE
RIGHTS
EXERCISED4
OTHER
TRANSACTIONS 5
BALANCE AT
30 JUNE 20226
EXECUTIVE DIRECTOR
Chris Ashton
OTHER EXECUTIVE KMP
Tiernan O’Rourke
Mark Brantley
Karen Sobel
SHARES
RIGHTS
SHARES
RIGHTS
SHARES
RIGHTS
SHARES
RIGHTS
Vinayak Pai (Former)7
SHARES
Total
RIGHTS
SHARES
RIGHTS
138,669
315,321
–
–
24,616
58,423
15,495
121,598
78,035
179,868
256,815
675,210
–
298,104
–
81,760
–
97,094
–
99,848
–
–
–
576,806
9,279
(9,279)
–
–
12,311
(12,311)
6,811
(6,811)
27,522
(27,522)
55,923
(55,923)
(3,652)
(17,432)
–
–
(4,320)
(2,672)
(4,435)
(105,557)
(152,346)
(116,201)
(174,213)
144,296
586,714
–
81,760
32,607
143,206
19,634
210,200
–
–
196,537
1,021,880
4
5
This includes shares received as a result of performance rights exercised.
These may include:
• rights lapsed due to cessation of employment or because of performance tests;
• shares foregone by the executive at vesting equal to the value of any withholding tax paid by Worley on their behalf; or
• shares sold or otherwise disposed of.
6 No executives have nominally held shares.
7
Vinayak Pai ceased to be a KMP on 31 October 2021 and terminated employment with Worley on 31 December 2021. He forfeited all performance rights.
151
Annual Report 2022 8.4 Details of vested, exercised, lapsed and outstanding rights
We’ve set out full details of previous equity grants in the Remuneration Report for the relevant year. Each grant has an expiry date
seven years following the grant date.
Table 8.4.1
NAME
PLAN
GRANT DATE
VEST DATE
GRANTED 1
EXECUTIVE DIRECTOR
Chris Ashton
DEP
31‑Oct‑21
30‑Sep‑24
56,398
31‑Oct‑21
30‑Sep‑23
56,398
31‑Oct‑20
30‑Sep‑23
43,996
31‑Oct‑20
30‑Sep‑22
43,996
31‑Oct‑19
30‑Sep‑22
31‑Oct‑19
30‑Sep‑21
9,278
9,279
LTI5
31‑Oct‑21
30‑Sep‑25
92,654
31‑Oct‑21
30‑Sep‑25
92,654
31‑Oct‑20
30‑Sep‑24
74,793
31‑Oct‑20
30‑Sep‑24
74,793
31‑Oct‑19
30‑Sep‑23
20,877
31‑Oct‑19
30‑Sep‑23
20,877
31‑Oct‑18
30‑Sep‑22
31‑Oct‑18
30‑Sep‑22
8,716
8,716
31‑Oct‑21
30‑Sep‑24
16,060
31‑Oct‑21
30‑Sep‑23
16,060
OTHER EXECUTIVE KMP
Tiernan O’Rourke6
DEP
LTI
31‑Oct‑21
30‑Sep‑25
24,820
31‑Oct‑21
30‑Sep‑25
24,820
Mark Brantley7
DEP
31‑Oct‑21
30‑Sep‑24
19,072
31‑Oct‑21
30‑Sep‑23
19,072
31‑Oct‑20
30‑Sep‑23
31‑Oct‑20
30‑Sep‑22
31‑Oct‑19
30‑Sep‑22
31‑Oct‑19
30‑Sep‑21
29‑Apr‑19
30‑Sep‑21
9,705
9,705
7,292
7,293
5,018
31‑Oct‑21
30‑Sep‑25
29,475
31‑Oct‑21
30‑Sep‑25
29,475
31‑Oct‑20
30‑Sep‑24
31‑Oct‑20
30‑Sep‑24
9,705
9,705
ECR
LTI
FAIR VALUE
PER RIGHT 2
FAIR VALUE
OF GRANT
$000 3
RIGHTS
VESTED
RIGHTS
EXERCISED
RIGHTS
LAPSED 4
RIGHTS
LAPSED
%
9.37
9.89
8.08
8.58
12.1
12.7
8.92
5.86
7.67
5.6
12.1
7.78
6.62
13.19
9.37
9.89
8.92
5.86
9.37
9.89
8.08
8.58
12.1
12.7
13.26
8.92
5.86
7.67
5.6
528
558
355
377
112
118
826
543
574
419
253
162
58
115
150
159
221
145
179
189
78
83
88
93
67
263
173
74
54
–
–
–
–
–
–
–
–
–
–
(9,279)
(9,279)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(7,293)
(7,293)
(5,018)
(5,018)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(8,716)
(8,716)
100%
100%
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
Continued overleaf
152
Worley Remuneration Report FAIR VALUE
PER RIGHT 2
FAIR VALUE
OF GRANT
$000 3
RIGHTS
VESTED
RIGHTS
EXERCISED
RIGHTS
LAPSED 4
RIGHTS
LAPSED
%
Table 8.4.1 (continued)
NAME
PLAN
GRANT DATE
VEST DATE
GRANTED 1
Karen Sobel
DEP
31‑Oct‑21
30‑Sep‑24
19,613
31‑Oct‑21
30‑Sep‑23
19,613
31‑Oct‑20
30‑Sep‑23
14,577
31‑Oct‑20
30‑Sep‑22
14,578
31‑Oct‑19
30‑Sep‑22
31‑Oct‑19
30‑Sep‑21
6,812
6,811
LTI5
31‑Oct‑21
30‑Sep‑25
30,311
31‑Oct‑21
30‑Sep‑25
30,311
31‑Oct‑20
30‑Sep‑24
21,866
31‑Oct‑20
30‑Sep‑24
21,867
31‑Oct‑19
30‑Sep‑23
15,326
31‑Oct‑19
30‑Sep‑23
15,326
31‑Oct‑18
30‑Sep‑22
31‑Oct‑18
30‑Sep‑22
2,218
2,217
Vinayak Pai (Former)8 DEP
31‑Oct‑20
30‑Sep‑23
19,169
31‑Oct‑20
30‑Sep‑22
19,170
31‑Oct‑19
30‑Sep‑22
10,273
31‑Oct‑19
30‑Sep‑21
10,272
9.37
9.89
8.08
8.58
12.1
12.7
8.92
5.86
7.67
5.6
12.1
7.78
6.62
13.19
8.08
8.58
12.1
12.7
ECR9
LTI
29‑Apr‑19
30‑Sep‑21
17,250
13.26
31‑Oct‑20
30‑Sep‑24
28,754
31‑Oct‑20
30‑Sep‑24
28,754
31‑Oct‑19
30‑Sep‑23
31‑Oct‑19
30‑Sep‑23
23,113
23,113
7.67
5.6
12.1
7.78
184
194
118
125
82
86
270
178
168
122
185
119
15
29
155
164
124
130
229
221
161
280
180
–
–
–
–
–
–
–
–
–
–
(6,811)
(6,811)
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
(10,272)
(10,272)
(17,250)
(17,250)
–
–
–
–
–
–
–
–
–
–
–
–
(2,218)
(2,217)
(19,169)
(19,170)
(10,273)
–
–
–
–
–
–
–
–
–
–
(28,754)
(28,754)
(23,113)
(23,113)
–
–
–
–
–
–
–
–
–
–
–
–
100%
100%
100%
100%
100%
–
–
100%
100%
100%
100%
1 We discuss the service and performance criteria for the rights in the executive remuneration structure section from page 141. Each right entitles the holder to one fully paid
ordinary share in the Company at a nil exercise price (i.e. a zero exercise price option). The rights granted may include those granted before the executive became a KMP.
2 An independent valuer determines the fair value per right at grant date, using an option‑pricing model in accordance with AASB 2 Share Based Payments. This model takes
into account the:
• exercise price;
• term of the right;
• vesting and performance criteria;
• impact of dilution;
• non‑tradeable nature of the right;
• share price at grant date;
• expected price volatility of the underlying share;
• expected dividend yield; and
• risk‑free interest rate for the term of the right.
This amount represents the actual cost to the Company. We’ve used a Monte Carlo simulation model to value the relative TSR. We’ve used a Black‑Scholes model to value
the EPS growth rights, DEP rights and other equity‑settled rights.
3 We’ve calculated the total fair value of grant by multiplying the fair value per right by the number of rights granted. This doesn’t represent the actual value the executives
will receive from the grant. This depends on them achieving their performance hurdles over the vesting period and the face value (share price) at the time of vesting.
We’ve estimated the maximum value of the rights granted, based on the fair value per right. If the executive doesn’t meet the applicable performance hurdles, the minimum
total value of the rights granted is nil.
4 The number of rights lapsed represents rights lapsed due to executives not meeting performance hurdles and/or rights lapsed on cessation of employment.
5 Neither tranche of the FY2020 LTI grant (due to vest 30‑Sep‑2022) met the minimum performance requirements for vesting. These rights will lapse in full on the vesting date.
6 Tiernan O’Rourke started as a KMP on 29 November 2021. He was granted rights under the FY2022 DEP and LTI plans on a pro‑rata basis, given his start date part way
through the financial year.
7 Mark Brantley started as a KMP on 1 November 2021. His rights include equity granted to him prior to becoming a KMP.
8 Vinayak Pai ceased to be a KMP on 31 October 2021 and terminated employment with Worley on 31 December 2021. He forfeited all performance rights.
9 ECR rights relate to equity granted to Vinayak Pai to replace forgone ECR equity.
153
Annual Report 2022
8.5 Non-Executive Director remuneration outcomes
We’ve set out NED remuneration for FY2022 and FY2021 below.
Table 8.5.1
NAME
John Grill
Andrew Liveris2
Juan Suárez Coppel
Thomas Gorman3
Christopher Haynes
Roger Higgins
Martin Parkinson
Emma Stein4
Anne Templeman-Jones
Sharon Warburton
Wang Xiao Bin
Total remuneration
YEAR
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
FY2022
FY2021
SHORT TERM EMPLOYEE BENEFITS
POST-EMPLOYMENT BENEFITS
FEES
$000
500
500
247
238
221
221
243
256
237
247
235
215
201
202
211
110
242
242
221
211
221
213
2,779
2,655
TRAVEL
ALLOWANCES
$000
SUPERANNUATION 1
$000
TOTAL
$000
5
–
5
–
5
–
–
–
5
–
5
–
5
–
5
–
5
–
5
–
–
–
45
–
22
22
23
22
‑
‑
‑
‑
‑
‑
‑
14
20
19
21
10
‑
‑
‑
10
‑
8
86
105
527
522
275
260
226
221
243
256
242
247
240
229
226
221
237
120
247
242
226
221
221
221
2,910
2,760
1 Superannuation contributions are made on behalf of NEDs in accordance with the Company’s statutory superannuation obligations.
2 Andrew Liveris retired as a member of the Health, Safety and Sustainability Committee on 18 February 2022. However there was no change to his remuneration as he
holds the role of Lead Independent Director and does not receive additional fees for being a member of a Committee.
3 Thomas Gorman stepped down as Chair of the People and Remuneration Committee on 4 November 2021.
4 Emma Stein was appointed Chair of the People and Remuneration Committee on 4 November 2021 and a member of the Health, Safety and Sustainability Committee
on 28 April 2022.
154
Worley Remuneration Report
8.6 Non-Executive Director interests in shares
We have detailed NED beneficial interests in shares of the Company as at 30 June 2022 below. This includes shares held outright,
either solely in the Directors’ name, jointly with another person, in a self‑managed superannuation plan or where the Directors are
able to establish they have a beneficial entitlement.
Table 8.6.1
NAME
John Grill
Andrew Liveris
Juan Suárez Coppel
Thomas Gorman
Christopher Haynes
Roger Higgins
Martin Parkinson
Emma Stein
Anne Templeman-Jones
Sharon Warburton
Wang Xiao Bin
TYPE
Shares
Shares
Shares
Shares
Shares
Shares
Shares
Shares
Shares
Shares
Shares
BALANCE AT
30 JUNE 2021
34,336,128
17,870
12,782
29,000
18,922
34,000
16,000
20,840
11,047
22,500
11,000
OTHER
TRANSACTIONS
–
–
5,250
–
–
–
–
–
6,335
–
–
%OF NED
MINIMUM
SHAREHOLDING
TARGET
ACHIEVED 1
>100%
>100%
>100%
>100%
>100%
>100%
>100%
>100%
>100%
>100%
>100%
BALANCE AT
30 JUNE 2022
34,336,128
17,870
18,032
29,000
18,922
34,000
16,000
20,840
17,382
22,500
11,000
1 The NED MSR requires NEDs hold the equivalent of 100% of the annual NED base fee in Worley shares. We calculate this by multiplying the number of shares held by the
higher of the purchase price or the VWAP over the five trading days to 30 June 2022 ($14.16). NEDs have 3 years from the date of election to meet the MSR.
This Directors’ Report (including the Remuneration Report) is made in accordance with a resolution of the directors.
John Grill AO
Chair
155
Annual Report 2022 NOTES TO THE FINANCIAL STATEMENTS CONTINUED
Statement of financial performance and other
comprehensive income
For the financial year ended 30 June 2022
REVENUE AND OTHER INCOME
Professional services revenue
Construction and fabrication revenue
Procurement revenue
Interest income
Other income
Total revenue and other income
EXPENSES
Professional services costs
Construction and fabrication costs
Procurement costs
Global support costs
Transition, transformation and restructuring costs
Strategic costs
Other costs
Finance costs
Total expenses
Share of net profit/(loss) of associates accounted for using the equity method
Profit before income tax expense
Income tax expense
Profit after income tax expense
Profit after income tax expense attributable to:
Members of Worley Limited
Non-controlling interests
Other comprehensive income
Items that may be reclassified in future periods to the Statement of Financial Performance, net of tax
Net movement in foreign currency translation reserve
Net movement in hedge reserve
Items that will not be reclassified in future periods to the Statement of Financial Performance, net of tax
Net movement in defined benefit reserve
Total comprehensive income/(loss), net of tax
Total comprehensive income/(loss), net of tax, attributable to:
Members of Worley Limited
Non-controlling interests
Basic earnings per share (cents)
Diluted earnings per share (cents)
NOTES
CONSOLIDATED
2022
$’M
2021 RESTATED
$’M
5,444
2,806
1,445
4
6
9,705
(4,954)
(2,693)
(1,429)
(154)
(65)
(30)
(30)
(64)
(9,419)
8
294
(117)
177
172
5
209
(5)
14
395
390
5
32.8
32.6
5,420
2,679
1,411
6
10
9,526
(5,084)
(2,539)
(1,396)
(146)
(129)
-
-
(83)
(9,377)
(7)
142
(61)
81
82
(1)
(171)
(3)
9
(84)
(80)
(4)
15.7
15.6
4
3(E)
5
5
5
22
6(A)
17
17
The above Statement of Financial Performance and Other Comprehensive Income should be read in conjunction with the accompanying notes.
156
Worley
Statement of financial position
As at 30 June 2022
ASSETS
Current assets
Cash and cash equivalents
Trade receivables and contract assets
Procurement assets
Other current assets
Prepayments
Income tax receivable
Derivatives
Total current assets
Non-current assets
Trade receivables and contract assets
Intangible assets
Property, plant and equipment and right of use (ROU) assets
Deferred tax assets
Equity accounted associates
Other non-current assets
Total non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other payables
Procurement payables
Provisions
Interest bearing loans and borrowings and lease liabilities
Income tax payable
Derivatives
Total current liabilities
Non-current liabilities
Trade and other payables
Interest bearing loans and borrowings and lease liabilities
Defined benefit obligations
Deferred tax liabilities
Provisions
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Retained profits
Members of Worley Limited
Non-controlling interests
TOTAL EQUITY
The above Statement of Financial Position should be read in conjunction with the accompanying notes.
NOTES
7
8
27
8
19(B)
8
10
28
29(A)
22(B)
9
27
11
13
19(C)
9
13
30
29(B)
11
15
16
CONSOLIDATED
2022
$’M
2021 RESTATED
$’M
507
1,952
164
215
99
107
3
3,047
128
6,155
617
192
189
68
7,349
522
1,682
223
256
100
80
4
2,867
169
6,056
618
213
172
60
7,288
10,396
10,155
1,350
199
610
564
38
32
2,793
53
1,605
51
90
121
1,920
4,713
5,683
5,341
(302)
640
5,679
4
5,683
1,284
228
666
246
32
10
2,466
44
1,813
51
60
137
2,105
4,571
5,584
5,321
(505)
730
5,546
38
5,584
Annual Report 2022
157
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
Statement of changes in equity
For the financial year ended 30 June 2022
CONSOLIDATED
ISSUED
CAPITAL
$’M
5,321
RETAINED
PROFITS
$’M
730
FOREIGN
CURRENCY
TRANSLATION
RESERVE
$’M
(510)
HEDGE
RESERVE
$’M
2
PERFORMANCE
RIGHTS
RESERVE
$’M
67
DEFINED
BENEFITS
RESERVE
$’M
-
ACQUISITION
RESERVE
$’M
(64)
MEMBERS OF
WORLEY
LIMITED
$’M
5,546
NON-
CONTROLLING
INTERESTS
$’M
38
TOTAL
$’M
5,584
177
209
(5)
14
395
172
209
(5)
14
390
5
-
-
-
5
20
-
20
-
(8)
-
(7)
(8)
(262)
-
(36)
(3)
(7)
(44)
(265)
59
(1)
5,927
81
82
(168)
(3)
(171)
(3)
9
(80)
-
-
(3)
9
(4)
(84)
24
-
24
(5)
(261)
-
(17)
(5)
(278)
(64)
5,546
38
5,584
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
14
14
-
-
-
-
-
-
-
-
-
20
(27)
-
-
60
-
-
-
-
-
24
(25)
-
67
-
-
-
9
9
-
-
-
-
(301)
(3)
14
(72)
5,679
4
5,683
68
(9)
(64)
5,868
As at 1 July 2021, restated
Profit after income tax expense
Foreign exchange movement on translation of
foreign controlled entities and associates
Fair value loss on mark to market of forward
exchange contracts, net of tax
Remeasurement gain on defined benefit plans, net
of tax
Total comprehensive income/(loss), net of tax
Transactions with owners
Share based payments expense
Transfer to issued capital on issuance of shares to
satisfy performance rights
Increase in ownership of controlled entities
Dividends paid
As at 30 June 2022
As at 1 July 2020, restated1
Profit after income tax expense, restated
Foreign exchange movement on translation of
foreign controlled entities and associates
Fair value loss on mark to market of cross currency
hedge, net of tax
Remeasurement gain on defined benefit plans, net
of tax
Total comprehensive income/(loss), net of tax
Transactions with owners
Share based payments expense
Transfer to issued capital on issuance of shares to
satisfy performance rights
Dividends paid
As at 30 June 2021, restated
-
-
-
-
-
-
20
-
-
5,341
5,301
-
-
-
-
-
-
20
-
5,321
172
-
-
-
-
209
-
-
172
209
-
-
-
(262)
640
909
82
-
-
-
-
-
-
-
(342)
-
(168)
-
-
82
(168)
-
-
(261)
730
-
-
-
(510)
-
-
(5)
-
(5)
-
-
-
-
5
-
-
(3)
-
(3)
-
-
-
2
The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.
1 Refer to note 2(E) in the accompanying notes.
158
Worley
Statement of cash flows
For the financial year ended 30 June 2022
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from customers
Payments to suppliers and employees
Dividends received from associates
Interest received
Finance costs (including leases) paid
Income taxes paid
Net cash inflow from operating activities
CASH FLOWS FROM INVESTING ACTIVITIES
Payments for acquisition of controlled entities and other investments, net of cash acquired
Payments for purchase of property, plant and equipment and computer software
Proceeds from disposals of investments
Proceeds from sale of property, plant and equipment
Net cash outflow from investing activities
CASH FLOWS FROM FINANCING ACTIVITIES
Repayments of loans and borrowings
Proceeds from loans and borrowings
Lease liability payments
Costs of bank facilities
Net loans (to)/from related parties
Dividends paid to members of Worley Limited
Dividends paid to non-controlling interests
Net cash outflow from financing activities
Net increase in cash
Cash and cash equivalents at the beginning of the financial year
Effects of foreign exchange rate changes on cash
Cash and cash equivalents at the end of the financial year
The above Statement of Cash Flows should be read in conjunction with the accompanying notes.
NOTES
7
18(B)
7
CONSOLIDATED
2022
$’M
9,863
(9,443)
420
1
4
(51)
(58)
316
(23)
(53)
12
2
(62)
(5,047)
5,184
(110)
(6)
(6)
(262)
(3)
(250)
4
493
22
519
2021
$’M
10,087
(9,446)
641
3
4
(63)
(52)
533
(53)
(80)
40
1
(92)
(4,363)
4,368
(136)
(11)
6
(261)
(17)
(414)
27
490
(24)
493
Annual Report 2022
159
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
Notes to the financial statements
For the financial year ended 30 June 2022
1. CORPORATE INFORMATION
The financial report of Worley Limited (the "Company" or "Parent Entity") for the financial year ended 30 June 2022 was authorized for issue in accordance
with a resolution of the directors on 24 August 2022. The financial report is for the Group consisting of Worley Limited and its subsidiaries.
Worley Limited is a company limited by shares incorporated in Australia whose shares are publicly traded on the Australian Securities Exchange (ASX: WOR).
Worley Limited is a for-profit entity for the purposes of preparing these financial statements.
The nature of the operations and principal activities of the Company are described in notes 3 and 4.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
(A) BASIS OF ACCOUNTING
(i) Basis of preparation
This general purpose financial report has been prepared in accordance with the Corporations Act 2001, Australian Accounting Standards (AAS) and other
authoritative pronouncements of the Australian Accounting Standards Board (AASB).
The Group is of a kind referred to in ASIC Corporations Instrument 2016/191 (Rounding in Financial/Directors' Reports) issued by the Australian Securities
and Investments Commission which relates to the “rounding off” of amounts in the Directors’ Report and financial statements. Unless otherwise expressly
stated, amounts have been rounded off to the nearest one million dollars in accordance with that Instrument. Amounts shown as 0 represent amounts less
than AUD $500,000 which have been rounded to the nearest one million.
(ii) Statement of compliance
The consolidated financial report complies with International Financial Reporting Standards and interpretations as issued by the Australian Accounting
Standards Board (AASB).
(iii) Historical cost convention
The financial report has been prepared on a historical cost basis, except for derivative financial instruments, unlisted equity instruments, and assets held for
sale, where applicable, that have been measured at fair value. The carrying values of recognized assets and liabilities that are hedged with fair value hedges
are adjusted to record changes in the fair values attributable to the risks that are being hedged.
(iv) Critical accounting estimates
In the application of AAS, management is required to make judgments, estimates and assumptions about carrying values of assets and liabilities. The
estimates and underlying assumptions are based on historical experience and various other factors that are believed to be reasonable under the
circumstances.
Revisions to accounting estimates are recognized in the period in which the estimate is revised if the revision affects only that period or in the period of the
revision and future periods if the revision affects both current and future periods.
Management has identified the following critical accounting policies for which significant judgments, estimates and assumptions are made:
• revenue recognition, refer note 4;
• expected credit loss allowance, refer note 8;
• goodwill and intangible assets with identifiable useful lives, refer note 10;
• project, warranty and other provisions, refer note 11;
• inclusion and classification of contingent liabilities, refer note 25; and
• recovery and valuation of deferred tax assets and liabilities, refer note 29.
Actual results may differ from these estimates under different assumptions and conditions and may materially affect financial results or the financial
position reported in future periods.
(v) Adoption of new and amended accounting standards and interpretations
There have been no new and revised standards, amendments or AASB interpretations adopted by the Group during the current period.
160
Worley
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(vi) New accounting standards that are not yet applicable
The Group has not early adopted any standards or interpretations which are not yet applicable. The potential impacts of standards and interpretations that
are not yet applicable are disclosed below.
Applicable 1 July 2022
Onerous Contracts - Costs of Fulfilling a Contract - Amendments to IAS 37
In May 2020, the IASB issued amendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets to specify which costs an entity needs to include
when assessing whether a contract is onerous or loss making. The amendments apply a 'directly related cost approach'. The costs that relate directly to a
contract to provide goods or services include both incremental costs and an allocation of costs directly related to contract activities. General and
administrative costs do not relate directly to a contract and are excluded unless they are explicitly chargeable to the counterparty under the contract.
The amendments are not expected to have a material impact on the Group.
Applicable 1 July 2023
AASB 17 Insurance Contracts (AASB 17)
The overall objective of AASB 17 is to provide an accounting model for insurance contracts that is more useful and consistent for insurers. In contrast to the
requirements in AASB 4 Insurance Contracts which are largely based on grandfathering previous local accounting policies, AASB 17 provides a comprehensive
model for insurance contracts, covering all relevant accounting concepts.
Although the Group has not fully assessed the impact of the amendments, they are unlikely to have a material impact on the Group.
Classification of liabilities as current or non-current (Amendments to AASB 101 Presentation of Financial Statements)
In January 2020, the AASB issued amendments to paragraphs 69 to 76 of IAS 1 to specify the requirements for classifying liabilities as current or non-
current.
The amendments clarify:
• What is meant by a right to defer settlement;
• That a right to defer must exist at the end of the reporting period;
• That classification is unaffected by the likelihood that an entity will exercise its deferral right; and
• That only if an embedded derivative in a convertible liability is itself an equity instrument would the terms of a liability not impact its classification.
Although the Group has not fully assessed the impact of the amendments, they are unlikely to have a material impact on the Group.
Disclosure of Accounting Policies (Amendments to AASB 101 and AASB Practice Statement 2)
In the process of preparing financial statements, judgments are regularly made around what is considered to be sufficiently material to include in the notes to
the financial statements. This amendment has been implemented to clarify the definition of what is "material" and to make this definition consistent across
all IFRS standards and within the Conceptual Framework. The key amendments include:
• Requiring companies to disclose material policies, rather than significant policies;
• Clarifying that accounting policies related to immaterial transactions are themselves immaterial and therefore need not be disclosed; and
• Clarifying that not all accounting policies that relate to material transactions are themselves material to a company's financial statements and therefore
may not need to be disclosed.
When the amendment becomes applicable, this will have an impact on the Group in that it will inform the conclusions around what is included in the
consolidated financial statements.
Deferred Tax relating to Assets and Liabilities arising from a Single Transaction (Amendments to AASB 112)
In May 2021, the AASB issued amendments to AASB 112, which narrow the scope of the initial recognition under AASB 112, so that it no longer applies to
transactions that give rise to equal, taxable and deductible temporary differences. Although the Group has not fully assessed the impact of the amendments,
they are unlikely to have a material impact on the Group.
(B) BASIS OF CONSOLIDATION
The consolidated financial statements incorporate the assets and liabilities of all entities controlled by Worley Limited as at 30 June 2022 and the results of
all controlled entities for the financial year then ended. Worley Limited and its controlled entities together are referred to in this financial report as the
consolidated entity or Group. Investments in associates are equity accounted and are not part of the consolidated entity (refer note 22).
The impact of all transactions between entities in the consolidated entity is eliminated. Non-controlling interests in the results and equity of controlled
entities are shown separately in the Statement of Financial Performance and Other Comprehensive Income and Statement of Financial Position.
Non-controlling interests not held by the Company are allocated their share of net profit after tax and total comprehensive income net of tax in the
Statement of Financial Performance and Other Comprehensive Income and are presented within equity in the Statement of Financial Position separately
from the equity of members of Worley Limited.
(C) FOREIGN CURRENCY TRANSLATION
(i) Functional and presentation currency
Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic environment in which the
entity operates (functional currency). The consolidated financial statements are presented in Australian dollars which is the Group’s presentation currency.
Annual Report 2022
161
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(ii) Translation of foreign currency transactions
Transactions denominated in a foreign currency are converted at the foreign exchange rate at the date of the transaction. Foreign currency denominated
receivables and payables at balance date are translated at foreign exchange rates at balance date. Foreign exchange gains and losses are brought to account
in determining the profit and loss for the financial year.
(D) OTHER ACCOUNTING POLICIES
Significant and other accounting policies that summarize the measurement basis used and are relevant to the understanding of the financial statements are
provided throughout the notes to the financial statements.
(E) RESTATEMENT OF COMPARATIVES
During the current period the Group identified that employee expenses were understated by $17 million and $5 million in FY2020 and FY2021 respectively
(pre-tax impact). Respective payroll liabilities were understated by $17 million and $22 million in FY2020 and FY2021 respectively. The impact to profit after
income tax is $13 million and $4 million for FY2020 and FY2021 respectively. Income tax receivable is understated stated by $4 million in FY2020 and $5
million in FY2021.
This represented an isolated incident in relation to a payroll accrual in the Americas Region which occurred during the integration of ECR into the Worley
Group as part of its acquisition from Jacobs in FY2019. The financial statements have been adjusted for this impact by restating each of the affected financial
statement line items for the prior period presented in the current Annual Financial Report. The following tables summarise the impacts on the Group’s
consolidated financial statements, including the impact on earnings per share:
(i) Statement of financial performance and other comprehensive income
EXPENSES
Professional services costs
Total expenses
Profit before income tax
Income tax expense
Profit after income tax
Profit after tax attributable to members of Worley Limited
Basic earnings per share (cents)
Diluted earnings per share (cents)
(ii) Statement of financial position as at 30 June 2021
ASSETS
Current assets
Income tax receivable
Total current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Total current liabilities
Total liabilities
Net assets
EQUITY
Retained profits - opening 1 July 2020
Retained profits after tax attributable to Members of Worley Limited year ended 30 June 2021
Total equity
CONSOLIDATED
2021
$’M
RESTATEMENT
$’M
2021 RESTATED
$’M
(5,079)
(9,372)
147
(62)
85
86
16.5
16.3
(5)
(5)
(5)
1
(4)
(4)
(5,084)
(9,377)
142
(61)
81
82
15.7
15.6
CONSOLIDATED
2021
$’M
RESTATEMENT
$’M
2021 RESTATED
$’M
75
2,862
10,150
1,262
2,444
4,549
5,601
922
86
5,601
5
5
5
22
22
22
(17)
(13)
(4)
(17)
80
2,867
10,155
1,284
2,466
4,571
5,584
909
82
5,584
162
Worley
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
(iii) Statement of financial position as at 30 June 2020
ASSETS
Current assets
Income tax receivable
Total current assets
Total assets
LIABILITIES
Current liabilities
Trade and other payables
Total current liabilities
Total liabilities
Net assets
EQUITY
Retained profits - opening 1 July 2019
Retained profits after tax attributable to Members of Worley Limited year ended 30 June 2020
Total equity
CONSOLIDATED
2020
$’M
RESTATEMENT
$’M
2020 RESTATED
$’M
64
3,213
11,081
1,470
3,127
5,141
5,940
959
171
5,940
4
4
4
17
17
17
(13)
-
(13)
(13)
68
3,217
11,085
1,487
3,144
5,158
5,927
959
158
5,927
There is no impact to the total operating, investing or financing cash flows for the years ended 30 June 2021 and 30 June 2020.
In addition to the primary financial statements, the FY2021 balances in the following notes to the financial statements have been restated in accordance
with the accounting standards:
• Note 3 Segment information
• Note 5 Expenses and losses/(gains)
• Note 6 Income tax
• Note 7 Cash and cash equivalents (reconciliation of operating cash only)
• Note 9 Trade and other payables
• Note 12 Capital management
• Note 17 Earnings per share
3. SEGMENT INFORMATION
(A) IDENTIFICATION OF OPERATING SEGMENTS
The Group's operating segments are reported on a regional basis as follows:
• Americas;
• EMEA; and
• APAC.
The Group has also included additional information segmented according to its market sector groups. These segments are consistent with those reported in
30 June 2021.
Annual Report 2022
163
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
3. SEGMENT INFORMATION (CONTINUED)
(B) OPERATING SEGMENTS, FINANCIAL YEAR 2021 DATA RESTATED
Professional services revenue
Construction and fabrication revenue
Procurement revenue at margin
Other income
Total aggregated revenue1
Segment EBITA2
Segment margin
Other segment information
Depreciation and amortization expense3
Share of net profits/(losses) of associates accounted for using the equity method
Carrying value of equity accounted associates
Purchase of non-current assets
(C) MARKET SECTOR GROUPS, FINANCIAL YEAR 2021 DATA RESTATED
AMERICAS
EMEA
APAC
TOTAL
2022
$’M
2021
$’M
2022
$’M
2021
$’M
2022
$’M
2021
$’M
2022
$’M
1,860 1,758 2,300 2,297 1,594 1,575 5,754
- 2,806
887
2,198 1,792
499
149
219
6
-
-
608
260
-
-
110
6
129
-
94
3
2021
$’M
5,630
2,679
462
3
4,187 3,769 3,168 3,333 1,710 1,672 9,065
8,774
271
6.5%
258
6.8%
283
8.9%
181
202
6.1% 10.6%
152
9.1%
735
8.1%
612
7.0%
47
(1)
29
11
61
(1)
16
35
80
8
145
22
84
11
142
30
40
1
15
20
37
2
14
15
167
8
189
53
182
12
172
80
Professional services revenue
Construction and fabrication revenue
Procurement revenue at margin
Other income
Total aggregated revenue
Segment EBITA
Segment margin
ENERGY
CHEMICALS
RESOURCES
TOTAL
2022
$’M
2,523
1,719
229
6
4,477
327
7.3%
2021
$’M
2,272
1,861
258
3
4,394
299
6.8%
2022
$’M
2,157
1,032
119
-
3,308
302
9.1%
2021
$’M
2,309
818
123
-
3,250
238
7.3%
2022
$’M
1,074
55
151
-
1,280
106
8.3%
2021
$’M
1,049
-
81
-
1,130
75
6.6%
2022
$’M
5,754
2,806
499
6
9,065
735
8.1%
(D) RECONCILIATION OF AGGREGATED REVENUE TO TOTAL REVENUE AND OTHER INCOME PER THE STATEMENT OF FINANCIAL PERFORMANCE
Aggregated revenue
Gain on disposal of subsidiary/investment
Procurement revenue at nil margin (including share of revenue from associates)
Share of revenue from associates4
Interest income
Total revenue and other income per the Statement of Financial Performance
TOTAL
2022
$’M
9,065
-
946
(310)
4
9,705
2021
$’M
5,630
2,679
462
3
8,774
612
7.0%
2021
$’M
8,774
7
949
(210)
6
9,526
1 Aggregated revenue represents segment revenue, which is defined as statutory revenue and other income plus share of revenue from associates, less procurement revenue at nil
margin, pass-through revenue at nil margin and interest income. The directors believe the disclosure of revenue attributable to associates as part of aggregated revenue provides
additional information in relation to the financial performance of the Group.
2 Segment earnings before interest, tax and amortization of acquired intangible assets (EBITA) is aggregated revenue less segment expenses and excludes the items listed in note
3(G). It is the key financial measure that is presented to the chief operating decision maker.
3 Excludes amortization on acquired intangible assets and impairments, but includes amortization of leased right of use assets.
4 Calculated on an aggregate revenue basis.
164
Worley
3. SEGMENT INFORMATION (CONTINUED)
(E) RECONCILIATION OF SEGMENT EBITA TO PROFIT AFTER INCOME TAX EXPENSE PER THE STATEMENT OF FINANCIAL PERFORMANCE
Segment EBITA
Global support costs
Strategic costs1
Interest and tax for associates
Total underlying EBITA
Total underlying EBITA margin on aggregated revenue for the Group
Costs in relation to cost saving programs
Impact of transformation and restructuring:
Shared services transformation
Payroll and other restructuring costs
Property leased asset impairment reversals/(impairments)2
Transition costs3
International government subsidies, net of direct costs
Net impact of historical legal matters
Impact of withdrawal from Russia
Impairment of assets
Impairment of investments including equity accounted associates
Gain on disposal of subsidiary / investment
Certain one off other items
Total EBITA
Total EBITA margin on aggregated revenue for the Group
Amortization of acquired intangible assets
Net finance costs
Income tax expense
Profit after income tax expense per the Statement of Financial Performance
TOTAL
2022
$’M
2021 RESTATED
$’M
735
(154)
(30)
(4)
547
6.0%
(67)
(53)
(15)
4
(3)
2
(16)
(14)
(2)
(1)
-
-
449
5.0%
(95)
(60)
(117)
177
612
(146)
-
(3)
463
5.3%
(199)
-
(84)
(60)
(55)
70
-
-
(12)
(11)
7
1
319
3.6%
(100)
(77)
(61)
81
1 Strategic costs comprise of costs for strategic hires and agile team development in targeted sustainability growth areas, digital enablement, internal training and development,
and creating and building strategic partnerships to deliver sustainable solutions at scale.
2 Includes impairment of right of use assets and the related onerous property maintenance contract component.
3 Costs in relation to ECR integration.
Annual Report 2022
165
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
3. SEGMENT INFORMATION (CONTINUED)
(F) GEOGRAPHIC SEGMENTS1
Revenue from external customers2
2022
Europe, Middle East and Africa
United States of America
Other Americas
Australia, Pacific, Asia and China
Total
Other income per Segment
Interest income
ADD:
PROCUREMENT
REVENUE AT
NIL MARGIN
$’M
ADD:
PASS-THROUGH
REVENUE AT
NIL MARGIN
$’M
LESS:
SHARE OF
REVENUE FROM
ASSOCIATES
$’M
AGGREGATED
REVENUE
$’M
3,168
1,956
2,231
1,710
9,065
478
341
115
12
946
-
-
-
-
-
(250)
(26)
(6)
(28)
(310)
Total revenue and other income per the Statement of Financial Performance
2021
Europe, Middle East and Africa
United States of America
Other Americas
Australia, Pacific, Asia and China
Total
ADD:
PROCUREMENT
REVENUE AT
NIL MARGIN
$’M
ADD:
PASS-THROUGH
REVENUE AT
NIL MARGIN
$’M
LESS:
SHARE OF
REVENUE FROM
ASSOCIATES
$’M
AGGREGATED
REVENUE
$’M
3,334
1,881
1,888
1,671
8,774
193
637
77
42
949
-
-
-
-
-
(156)
(6)
(17)
(31)
(210)
Other income per Segment
Adjustments excluded from the underlying results
Interest income
Total revenue and other income per the Statement of Financial Performance
Non-current assets by geographical location:3
Europe, Middle East and Africa
United States of America
Other Americas
Australia, Pacific, Asia and China
Non-current assets by geographical location
TOTAL
REVENUE
FROM
EXTERNAL
CUSTOMERS
$’M
3,396
2,271
2,340
1,688
9,695
6
4
9,705
TOTAL
REVENUE
FROM
EXTERNAL
CUSTOMERS
$’M
3,371
2,512
1,948
1,679
9,510
3
7
6
9,526
2021
$’M
273
1,382
88
112
1,855
LESS:
OTHER
INCOME
$’M
-
-
-
(6)
(6)
LESS:
OTHER
INCOME
$’M
-
-
-
(3)
(3)
2022
$’M
227
1,343
83
100
1,753
1 Geographic locations are presented across all business lines. This is different to the internal reports presented to the chief operating decision makers.
2 Revenue is attributed to the geographic location based on the entity providing the services.
3 Excludes goodwill, deferred tax assets and derivative financial instruments.
166
Worley
3. SEGMENT INFORMATION (CONTINUED)
(G) ACCOUNTING POLICIES AND INTER-SEGMENT TRANSACTIONS
Segment revenues and expenses are those that are directly attributable to a segment and the relevant portion can be allocated to the segment on a
reasonable basis.
Segment revenues, expenses and results include transactions between segments incurred in the ordinary course of business. These transactions are priced
on an arm’s length basis and are eliminated on consolidation.
The accounting policies used by the Group in reporting segments internally are the same as those contained in these financial statements and are consistent
with those in the prior period.
The segment EBITA includes the allocation of overhead that can be directly attributed to an individual business segment. The following items and associated
assets and liabilities are not allocated to segments as they are not considered part of the core operations of any segment:
• global support costs;
• strategic costs;
• interest and tax for associates;
• amortization of acquired intangible assets;
• costs in relation to cost saving programs;
• other non-recurring gains and losses as described in note 3(E); and
• income tax expense.
4. REVENUE AND OTHER INCOME
Professional services revenue
Construction and fabrication revenue
Procurement revenue
Interest income
Revenue
Other income
Total revenue and other income
CONSOLIDATED
2022
$’M
5,444
2,806
1,445
4
9,699
6
9,705
2021
$’M
5,420
2,679
1,411
6
9,516
10
9,526
The amount of revenue recognized in the financial year 2022 from performance obligations satisfied (or partially satisfied) in previous periods is $6 million
(2021: $19 million) and is mainly due to the changes in the estimate of the stage of completion.
In addition to billings in advance balances, which represent amounts billed for which the relevant performance obligation has yet to be satisfied, a further
$605 million (2021: $350 million) of revenue (lump sum projects with an expected duration of one year or more) is expected to be recognized in the future
relating to performance obligations that are unsatisfied (or partially unsatisfied) at the reporting date.
Annual Report 2022
167
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
4. REVENUE AND OTHER INCOME (CONTINUED)
RECOGNITION AND MEASUREMENT
Revenue from contracts with customers is recognized when control of the goods or services is transferred to the customer at an amount that reflects the
consideration to which the Group expects to be entitled in exchange for those goods or services. Revenue is recognized and disclosed net of trade
allowances, duties and taxes paid.
The Group utilizes a five-step approach to revenue recognition which requires the Group to identify contracts and performance obligations, determine the
transaction price, allocate the transaction price to each performance obligation and recognize revenue as each performance obligation is satisfied.
The Group exercises judgment, taking into consideration all the relevant facts and circumstances when applying each step of the model to contracts with its
customers.
The Group’s main revenue streams are as follows:
Professional services revenue
• The Group performs engineering design and project delivery services. These activities are usually highly integrated and accordingly, where appropriate, are
accounted for as a single performance obligation. Performance obligations are fulfilled over time as the services are delivered, as the Group has a right of
payment for services delivered to date together with the highly customized nature of the services provided. Consequently, the Group recognizes revenue
for these service contracts over time. Payment terms depend on the contracts specifics and usually are within 30 to 60 days.
Construction and fabrication revenue
• The Group performs construction and fabrication services. These activities are highly integrated and accordingly, where appropriate, are accounted for as a
single performance obligation. Performance obligations are fulfilled over time as the services are delivered, as the Group has a right of payment for services
delivered to date together with the highly customized nature of the services provided. Consequently, the Group recognizes revenue for these construction
contracts over time. Payment terms are usually based on milestones achieved and are within 30 to 60 days from the date of the invoice.
Procurement revenue
• Procurement revenue represents services from contracts entered into with customers to acquire, on their behalf, equipment produced by various suppliers
and/or services provided by different subcontractors. The Group executes procurement services as a principal and as an agent. Where the Group controls
the promised goods or services before transferring them to the customer, the Group is a principal and records revenue and costs on a gross basis. If the
Group does not control the promised goods and services before transferring to the customer, i.e. the Group’s role is to arrange for another entity to provide
the goods or services, then the Group is an agent and records revenue and costs at the net amount that it retains for its agency services (margin). The
performance obligation is satisfied over time and payment is usually due upon receipt of the equipment by the customer or as subcontractor services are
performed, depending on the terms of the contract. Payment terms are usually within 30 to 60 days.
The Group measures revenue on the basis of the effort expended relative to the total expected effort to complete the service. Revenue on reimbursable
contracts is recognized in the same period as the associated costs based on agreed rates in accordance with the timing of work performed as it reflects the
expected effort to fulfil the performance obligation. For lump sum contracts, the Group considers the terms of the contract, internal models and other
sources when estimating the projected total cost and stage of completion. The percentage of completion is estimated by qualified professionals within the
project teams. Estimates of revenues, costs or extent of progress toward completion are revised if circumstances change.
Variable consideration, including performance incentives, is recognized from the outset of the contract but only to the extent that it is highly probable that a
significant revenue reversal will not occur. This estimate takes into account the facts and circumstances of each individual contract and historical experience
and is reassessed throughout the life of the contract.
The Group provides assurance warranties for general rework which are accounted for in accordance with AASB 137 Provisions, Contingent Liabilities and
Contingent Assets.
The Group does not expect to have any contracts where the period between the transfer of the promised goods or services to the customer and payment by
the customer exceeds one year. Therefore, the Group does not adjust any of the transaction prices for the time value of money.
Government grants
Government grants are recognized under the requirements of AASB 120 Accounting for Government Grants and Disclosure of Government Assistance.
Government grants are only recognized where there is reasonable assurance that the conditions attached will be complied with, and the grant will be
received. Government grants are recognized in profit and loss on a systematic basis over the periods in which the Group recognizes as expenses the related
costs for which the grants are intended to compensate. Government grants are recognized immediately in profit and loss if they are a receivable as
compensation for expenses or losses already incurred or for the purpose of giving immediate financial support with no further related costs. Government
grants are recorded against the related expense in the Statement of Financial Performance and Other Comprehensive Income.
Interest
Interest income is recognized as it accrues using the effective interest rate method including interest income on subleases that are classified as finance
leases under AASB 16 Leases.
Dividends
Revenue is recognized when the Group’s right to receive the payment is established.
Contract costs
Costs to obtain or fulfil a contract (contract costs) include all costs directly related to specific contracts that are specifically chargeable to the customer under
the terms of the contract, and an allocation of overhead expenses incurred in connection with the Group’s activities in general. The Group’s contract costs are
expensed as incurred, unless they are allowed for capitalization under accounting standards.
168
Worley
5. EXPENSES AND LOSSES/(GAINS)
Profit before income tax expense includes the following specific expenses and losses/(gains):
EXPENSES AND LOSSES/(GAINS)
Short term employee benefits
Post-employment benefits
Share based payments
Total staff costs
Costs in relation to cost saving programs
Impact of transformation and restructuring:
Shared services transformation
Payroll and other restructuring costs
Property leased asset (impairment reversals)/impairments1
Transition costs2
International government subsidies, net of direct costs
Transition, transformation and restructuring costs
Strategic costs
Net impact of historical legal matters
Impact of withdrawal from Russia
Other costs
Short term, low-value and variable leases expense
Amortization of intangible assets, right of use (ROU) assets and leasehold improvements
Depreciation
MOVEMENTS IN PROVISIONS3
Employee benefits
Insurance
Onerous contracts
Warranty
Project losses and other
CONSOLIDATED
2022
$’M
2021 RESTATED
$’M
5,401
108
20
5,529
67
53
15
(4)
3
(2)
65
30
16
14
30
23
208
54
355
4
(3)
13
(14)
5,321
102
24
5,447
199
-
84
60
55
(70)
129
-
-
-
-
35
227
55
219
2
22
8
29
Transition costs comprise of integration costs, restructuring and redundancy payments and research, development and implementation costs of integrated
finance, expense, sales, and HR systems.
Shared services transformation and payroll and other transformation and restructuring costs comprise the costs of restructuring and redundancy payments
in the planning and execution of transformation.
Strategic costs comprise of costs for strategic hires and agile team development in targeted sustainability growth areas, digital enablement, internal training
and development, and creating and building strategic partnerships to deliver sustainable solutions at scale.
Other costs contain the costs of withdrawal from Russia (refer to note 21(D)), and the net impact of historical legal matters including a final resolution for one
of the non-current debtors disclosed in note 8.
RECOGNITION AND MEASUREMENT
Employee benefits
Employee benefits expenses are charged against profit on a net basis in their respective categories.
Share based payments – equity and cash settled rights
Equity rights (rights) over the ordinary shares of Worley Limited are granted to executive directors and other executives of the consolidated entity for nil
consideration in accordance with performance guidelines approved by the Board. The fair values of the rights are amortized on a straight line basis over their
performance period. For share settled rights, the fair value of the rights is the share price at grant date adjusted for the impact of performance hurdles and
other vesting or exercise criteria attached to the right. For cash settled rights, the fair value of the rights is recalculated at the end of each reporting period
and amortized on a straight line basis over their vesting period. The accounting estimates and assumptions relating to equity settled rights would have no
impact on the carrying amounts of assets and liabilities within the next annual reporting period but may impact expenses and equity.
1 Includes impairment of right of use assets and the related onerous property maintenance contract component.
2 Costs in relation to ECR integration.
3 Excludes amounts utilized.
Annual Report 2022
169
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
5. EXPENSE AND LOSSES/(GAINS) (CONTINUED)
Fair value per right at grant date is independently determined using an appropriate option pricing model that takes into account the exercise price, the term
of the right, the vesting and performance criteria, the impact of dilution, the non-traded nature of the right, the share price at grant date and expected price
volatility of the underlying share, the expected dividend yield and the risk-free interest rate for the term of the right. This amount represents the actual cost
to the Company. A Monte Carlo simulation is applied to fair value the TSR component and the strategic hurdle rights. For the EPS, EBIT and “continuous
employment" condition, the Black-Scholes model is utilized. Total fair value at grant date is calculated by multiplying the fair value per right by the number
of rights granted. This does not represent the actual value the executive will derive from the grant which will depend on the achievement of performance
hurdles measured over the vesting period. The maximum value of the rights granted has been estimated based on the fair value per right. The minimum total
value of the rights granted, if the applicable performance hurdles are not met, is nil.
Borrowing costs
Borrowing costs are recognized as expenses in the period in which they are incurred, except when they are included in the costs of qualifying assets.
Borrowing costs include:
• interest on short term and long term loans and borrowings, as well as bank overdrafts;
• amortization of discounts or premiums relating to loans and borrowings and non-current payables; and
• interest on lease liabilities.
Depreciation and amortization
Property, plant and equipment
Depreciation is calculated on a straight line basis to write off the net cost of each item of property, plant and equipment (excluding land) over its expected
useful life to the consolidated entity. The expected useful lives for plant and equipment range from 3 to 10 years and buildings range from 30 to 40 years.
The estimated useful lives, residual values and depreciation method are reviewed at least each financial year end .
The cost of improvements to leasehold properties is amortized over the unexpired period of the lease or the estimated useful life of the improvement to the
consolidated entity, whichever is the shorter.
Identifiable intangible assets
The useful lives of intangible assets are assessed to be either finite or indefinite. Intangible assets with finite lives are amortized over their useful life and
tested for impairment whenever there is an indication that the intangible asset may be impaired. The amortization period for an intangible asset with a finite
useful life is reviewed at least each financial year end. Changes in the expected useful life or the expected pattern of consumption of future economic benefits
embodied in the asset are accounted for prospectively by changing the amortization period. The amortization expense on intangible assets with finite lives is
recognized in the Statement of Financial Performance and Other Comprehensive Income on a straight line basis over the following periods:
• customer contracts and relationships
• trade names
• computer software
• other
2-7 years; and
5-20 years;
3-15 years;
3-10 years.
Goods and services tax (GST)
Expenses are recognized net of the amount of GST, except where the GST incurred is not recoverable from the taxation authority. In these circumstances,
GST is recognized as part of the expense.
CONSOLIDATED
2022
$’M
2021 RESTATED
$’M
57
67
(7)
117
25
42
67
99
(28)
(10)
61
(43)
15
(28)
6. INCOME TAX
(A) INCOME TAX EXPENSE
Current tax
Deferred tax
Over provision in previous financial periods
Income tax expense
Deferred income tax expense included in income tax expense comprises:
Increase/(decrease) in deferred tax assets
Decrease in deferred tax liabilities
Deferred tax
170
Worley
6. INCOME TAX (CONTINUED)
(B) RECONCILIATION OF PRIMA FACIE TAX PAYABLE TO INCOME TAX EXPENSE
Profit before income tax expense
Prima facie tax expense at Worley Limited’s statutory income tax rate of 30% (2021: 30%)
Tax effect of amounts which are non-deductible/(non-taxable) in calculating taxable income:
Non-deductible items under US tax law
Certain withholding tax assets write off
Non-deductible shared based payments expense
Share of (profits)/losses of associates accounted for using the equity method
Tax losses not previously recognized
Over provision in previous financial periods
Valuation allowance against certain deferred tax assets
Change in tax legislation
Permanent difference due to valuation allowances for brought forward tax losses
Non-deductible disposal of subsidiary
Non-deductible impairment of an associate
Difference in overseas tax rates and other
Income tax expense
CONSOLIDATED
2022
$’M
2021 RESTATED
$’M
294
88
27
15
6
(2)
(4)
(7)
9
-
-
-
-
(15)
117
142
43
15
-
10
2
(1)
(10)
-
7
4
2
2
(13)
61
(C) AMOUNTS RECOGNIZED DIRECTLY IN EQUITY
Aggregate amount of tax arising in the reporting period and not recognized in profit after income tax expense but directly credited to equity:
Deferred tax - debited/(credited) directly to equity
6
(20)
(D) TAX LOSSES
The Group has tax losses for which no deferred tax asset is recognized on the Statement of Financial Position:
Unused tax losses for which no deferred tax asset has been recognized
Potential tax benefit at 30%
321
96
321
96
The benefit for tax losses will only be recognized if:
• the relevant tax entity derives future assessable income of a nature and of an amount sufficient to enable the benefit from the deductions for the losses to
be realized; or
• the losses are transferred to an eligible entity in the relevant tax entity; and
• the relevant tax entity continues to comply with conditions for deductibility imposed by tax legislation; and
• no changes in legislation adversely affect the relevant entity in realizing the benefit from the deductions for the losses.
RECOGNITION AND MEASUREMENT
Income tax
The income tax expense for the period is the tax payable on the current period's taxable income based on the income tax rate for each jurisdiction adjusted by
changes in deferred tax assets and liabilities as well as any adjustments required between prior periods' current tax expense and income tax returns and any
relevant withholding taxes.
Current and deferred tax amounts relating to items recognized directly in equity are recognized in equity and not in the Statement of Financial Performance.
Tax consolidation
Worley Limited and its wholly owned Australian entities elected to form a tax consolidated group from 1 July 2003. On formation of the tax consolidated
group, the entities in the tax consolidated group entered into a tax sharing agreement which, in the opinion of the directors, limits the joint and several
liability of the wholly owned entities in the case of a default by the head entity, Worley Limited.
The entities have also entered into a tax funding agreement under which the wholly owned entities fully compensate Worley Limited for any current tax
liability assumed and are compensated by Worley Limited for any current tax loss, deferred tax assets and tax credits that are transferred to Worley Limited
under the tax consolidation legislation.
Annual Report 2022
171
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
7. CASH AND CASH EQUIVALENTS
Cash and cash equivalents per Statement of Financial Position
Procurement cash and cash equivalents
Cash at bank and on hand
Less: bank overdraft
Balance per the Statement of Cash Flows
Reconciliation of profit after income tax expense to net cash inflow from operating activities:
Profit after income tax expense
NOTES
27
13
NON-CASH ITEMS
Amortization
Depreciation
(Impairment Reversals)/Impairments
Share based payments expense
Doubtful debts expense
Share of associates' profits in excess of dividends received
Impairment of investments including equity accounted associates
Gain on disposal of subsidiary/investment
Other
Cash flow adjusted for non-cash items
CHANGES IN ASSETS AND LIABILITIES
(Increase)/decrease in trade and other receivables
Decrease in prepayments and other current assets
Decrease in deferred tax assets
Increase in income tax receivable
Decrease in trade and other payables
Increase/(decrease) in billings in advance
Increase/(decrease) in income tax payable
Increase/(decrease) in deferred tax liabilities
Decrease in provisions
Net cash inflow from operating activities
CONSOLIDATED
2022
$’M
2021 RESTATED
$’M
507
12
519
-
519
177
208
54
(2)
20
26
(7)
1
-
9
486
(202)
42
21
(24)
(15)
47
3
30
(72)
316
522
4
526
(33)
493
81
227
55
50
24
(4)
(4)
11
(7)
(9)
424
376
75
36
(13)
(175)
(80)
(1)
(51)
(58)
533
RECOGNITION AND MEASUREMENT
Cash and cash equivalents in the Statement of Financial Position comprise cash at bank and in hand and short term deposits with an original maturity of
three months or less that are readily convertible to known amounts of cash. Bank overdrafts are included within interest bearing loans and borrowings and
lease liabilities in current liabilities in the Statement of Financial Position.
For the purposes of the Statement of Cash Flows, cash and cash equivalents consist of cash and cash equivalents, as defined above, net of outstanding bank
overdrafts. Cash flows are included in the Statement of Cash Flows on a gross basis. The GST component of cash flows arising from investing and financing
activities is classified as an operating cash flow.
Where cash and cash equivalents held by the Group are subject to external restrictions, the nature of the restrictions and value of cash subject to these
restrictions are disclosed below.
PROCUREMENT AND RESTRICTED CASH AND CASH EQUIVALENTS
Cash and cash equivalents include restricted cash of $50 million (2021: $6 million) that is available for use under certain circumstances by the Group.
Restricted cash is held in relation to guarantees (refer note 25(A)), financing activities, and legal matters, including $29 million held in accounts which are
subject to court ordered restricted access while active legal cases are being resolved (refer to note 25(B)), and $16 million held in Russian bank accounts that
the Group is working to repatriate (refer to note 21(D)).
Procurement cash is held in relation to procurement activities undertaken by the Group on behalf of its customers (refer note 27). Included within
procurement assets are cash and cash equivalents of $12 million (2021: $4 million).
172
Worley
8. TRADE RECEIVABLES, CONTRACT ASSETS, AND OTHER ASSETS
CURRENT TRADE RECEIVABLES AND CONTRACT ASSETS
Trade receivables
Unbilled contract revenue
Retentions
Expected credit loss (ECL) allowance on trade receivables
Less: procurement trade and other receivables
Movement in ECL allowance in respect of trade receivables and contract assets during the year was as
follows:
Balance at the beginning of the financial year
Net remeasurement of ECL allowance
Amounts written off against the opening ECL allowance
Transfer from non-current ECL allowance
Differences arising on translation of foreign operations
Balance at the end of the financial year
OTHER CURRENT ASSETS
Other receivables
Inventory
Amounts receivable from associates and related parties
NON-CURRENT TRADE RECEIVABLES AND CONTRACT ASSETS1
Trade receivables
Unbilled contract revenue
ECL allowance on trade receivables
NOTES
CONSOLIDATED
2022
$’M
2021
$’M
27
31(B)
1,261
843
72
(72)
(152)
1,952
30
26
(1)
16
1
72
143
35
37
215
67
69
(8)
128
1,088
779
64
(30)
(219)
1,682
39
(2)
(5)
-
(2)
30
204
26
26
256
123
69
(23)
169
Significant movements in unbilled contract revenue are primarily due to normal trading activity.
RECOGNITION AND MEASUREMENT
A trade receivable is recognized when the goods and services are delivered as this is the point in time that the consideration is unconditional because only the
passage of time is required before the payment is due. Trade receivables are generally on terms of 30 to 60 days. Receivables are stated with the amount of
GST included.
Unbilled contract revenue is initially recognized when the Group provides services or procures goods for a customer before the customer pays consideration
or before a payment is due. Unbilled contract revenue represents the Group’s contract assets at the reporting date. These assets are reclassified to trade
receivables when the customer is billed as stipulated in the contract, i.e. when the rights to consideration become unconditional. Unbilled contract revenue is
stated at the aggregate of contract costs incurred to date plus recognized profits less recognized losses and progress billings.
Inventory is recorded at the lower of cost and net realizable value. Costs are assigned to individual items of inventory on a weighted average costing basis.
When inventories are sold, the carrying value of inventories is recognized as an expense in the period in which the associated revenue is recognized. The
amount of any write down of inventory is recognized as an expense in the period the write down occurs.
Trade and other receivables are measured at amortized cost as they are held to collect contractual cash flows that consist solely of payments of principal
and interest on the principal amounts outstanding. At initial recognition, the Group measures trade and other receivables at transaction value with
subsequent measurement at amortized cost.
For trade receivables and unbilled contract revenue, the Group applies the simplified approach in calculating ECLs. Therefore, the Group does not track
changes in credit risk, but instead recognizes an allowance based on lifetime ECLs experience at each reporting date. The Group has established a provision
matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.
Despite any ECL booked, the Group reserves the right to collect any receivables owed to the Group at 30 June 2022.
1 Non-current trade receivables and unbilled contract revenue relate to projects where recovery is expected to take greater than twelve months. As at 30 June 2022, $48 million of
non-current payables relate to these non-current trade receivables and unbilled contract revenue (30 June 2021: $44 million).
Annual Report 2022
173
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
9. TRADE AND OTHER PAYABLES
CURRENT
Trade payables
Accruals
Amounts payable to associates and related parties
Billings in advance
Accrued staff costs
Less: procurement trade and other payables
NON-CURRENT
Trade payables1
NOTES
31(B)
27
CONSOLIDATED
2022
$’M
2021 RESTATED
$’M
627
301
4
369
248
(199)
1,350
53
53
639
342
-
322
209
(228)
1,284
44
44
Significant movements in billings in advance are primarily due to normal trading activity.
The Group’s exposure to currency and interest rate risk for trade and other payables is disclosed in note 19.
RECOGNITION AND MEASUREMENT
Liabilities for trade and other payables are measured at cost which is the fair value of the consideration to be paid in the future for goods and services
received, whether or not billed to the Group. Payables are stated with the amount of GST included.
Billings in advance or unearned revenue represent the Group’s obligation to transfer goods or services to a customer for which the Group has billed the
customer or received advance consideration from the customer. Billings in advance are recognized as revenue when the Group performs under the contract
and are classified as amortized cost subsequent to their initial recognition at fair value.
10. INTANGIBLE ASSETS
Goodwill
At cost
Accumulated impairment
Customer contracts and relationships
At cost
Accumulated amortization
Trade names2
At cost
Accumulated amortization
Computer software and other
At cost
Accumulated amortization
Total intangible assets
CONSOLIDATED
2022
$’M
2021
$’M
5,604
(200)
5,404
899
(317)
582
-
-
-
661
(492)
169
6,155
5,420
(200)
5,220
870
(223)
647
36
(35)
1
641
(453)
188
6,056
1 Non-current payables of $48 million (2021: $44 million) relate to amounts payable in connection with the non-current trade receivables and unbilled contract revenue on projects
where recovery is expected to take greater than twelve months as disclosed in note 8.
2 Fully amortized intangible assets have been net off during the period.
174
Worley
10. INTANGIBLE ASSETS (CONTINUED)
RECONCILIATIONS
Reconciliations of intangible assets at the beginning and end of the current and previous financial years are set out below:
Balance at 1 July 2021
Additions
Disposals
Amortization
Impairment
Differences arising on translation of foreign operations
Balance at 30 June 2022
Balance at 1 July 2020
Additions through business combinations
Additions
Disposals
Amortization
Impairment
Differences arising on translation of foreign operations
Balance at 30 June 2021
CONSOLIDATED
GOODWILL
$’M
CUSTOMER CONTRACTS
AND RELATIONSHIPS
$’M
TRADE
NAMES
$’M
COMPUTER SOFTWARE
AND OTHER
$’M
5,220
-
-
-
-
184
5,404
5,422
24
-
(42)
-
-
(184)
5,220
647
-
-
(86)
-
21
582
766
6
-
-
(89)
-
(36)
647
1
-
-
(1)
-
-
-
3
-
-
-
(2)
-
-
1
188
13
(1)
(39)
(2)
10
169
211
-
23
-
(34)
(5)
(7)
188
TOTAL
$’M
6,056
13
(1)
(126)
(2)
215
6,155
6,402
30
23
(42)
(125)
(5)
(227)
6,056
RECOGNITION AND MEASUREMENT
Goodwill
Goodwill represents the excess of the purchase consideration over the fair value of identifiable net assets acquired at the time of acquisition of a business or
shares in controlled entities or associates. Goodwill on acquisition of controlled entities is included in intangible assets. Gains and losses on the disposal of an
entity include the carrying amount of goodwill relating to the entity sold.
Identifiable intangible assets
Intangible assets acquired separately or in a business combination have finite useful lives and are initially measured at cost. The cost of an intangible asset
acquired in a business combination is its fair value as at the date of acquisition. Following initial recognition, intangible assets are carried at cost less any
accumulated amortization and any accumulated impairment losses. Internally generated intangible assets are not capitalized, and expenditure is recognized
in the profit and loss in the year in which the expenditure is incurred.
Research costs are expensed as incurred. An intangible asset arising from development expenditure on an internal project is recognized only when the Group
can demonstrate:
• the technical feasibility of completing the intangible asset so that it will be available for use or sale;
• its intention to complete and its ability to use or sell the asset;
• how the asset will generate future economic benefits;
• the availability of resources to complete the development; and
• the ability to measure reliably the expenditure attributable to the intangible asset during its development.
Impairment of assets
Goodwill is not amortized, and is instead carried at cost less accumulated impairment. Goodwill is tested at least annually for impairment; more often where
impairment indicators are present.
For the purposes of impairment testing, goodwill acquired in a business combination is allocated to groups of cash generating units (CGUs) that are expected
to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the Group are assigned to those groups of CGUs.
Impairment is determined by assessing the recoverable amount of the groups of CGUs to which the goodwill relates. The recoverable value of each CGU is
estimated based on its value in use, consistent with prior periods. When the recoverable amount of the groups of CGUs is less than the carrying amount, an
impairment loss is recognized. Where certain assets cease to be a part of a CGU (including but not limited to right of use assets), they are tested for
impairment individually, and where required are written down to their recoverable value.
Impairment losses recognized for goodwill are not subsequently reversed. Impairment losses recognized for right of use assets can be subsequently reversed
where it is supported by the recoverable value amount.
Assets that are subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount exceeds
its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell, and value in use. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows (CGUs).
Management has assessed that the lowest level at which goodwill is monitored is the three operating regions reporting to the CEO being Americas, EMEA
and APAC, unchanged from 30 June 2021.
Annual Report 2022
175
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
10. INTANGIBLE ASSETS (CONTINUED)
Value in use calculations used for impairment testing use cash flow projections based on financial forecasts of how the business is expected to perform
consistent with current and historical experience and external data. The estimation of future cash flows requires assumptions to be made regarding future
uncertain events. Our strategy considers the global transition of the world’s energy to renewable fuels and the continued focus on sustainability related
activities across our sectors. These trends have been considered in the market data utilized to assess each CGU’s growth rate for impairment testing.
KEY ESTIMATES
The goodwill allocated to the material CGUs and the key assumptions used for the value in use impairment testing are as follows:
2022
Opening balance
Allocated goodwill (closing balance)
Risk-weighted pre-tax discount rate
Risk-adjusted growth rate beyond five years
APAC
$’M
1,325
1,372
12.6%
3.4%
EMEA
$’M
1,433
1,482
9.5%
2.3%
AMERICAS
$’M
2,462
2,550
9.2%
2.1%
FORECAST CASH FLOWS
Forecast cash flows have been based on the group’s past experience and the assessment of economic and regulatory factors affecting the markets within
which the Group operates. The Group’s pivot to sustainability provides the structural framework for growth and we are winning work in line with our strategy.
The Group is seeing sustainability opportunities accelerate across all of our sectors and is well positioned to capture these opportunities with both new and
existing customers. The forecast cashflows consider the current economic environment, including global inflation rates, and geopolitical issues. The
compound annual growth rates for the CGUs range from 7% to 9%.
SENSITIVITY ANALYSIS
The combined recoverable values of all CGUs exceed the carrying value by $2 billion (2021: $2 billion). Management recognizes that the cash flow projections,
discount and growth rates used to calculate the value in use may vary from what has been estimated.
The value in use estimate is particularly sensitive to the achievement of long-term growth rates, discount rates and the forecast performance. The Group has
performed detailed sensitivity analysis as part of its impairment testing to ensure that the testing results are reasonable.
Sensitivity analysis on the inputs for all CGUs is as follows:
• terminal growth rates: a 0.5% decrease in the terminal growth rate will result in all the CGUs listed above being free of impairment at reporting date;
• post-tax discount rates: a 0.5% increase in the discount rate will result in all the CGUs listed above being free of impairment at reporting date; and
• forecast cash flows: a 5% decrease in the forecast cash flows will result in all the CGUs listed above being free of impairment at reporting date.
CONSOLIDATED
2022
$’M
2021
$’M
425
76
28
11
10
60
610
95
-
25
1
121
405
126
27
19
5
84
666
83
2
20
32
137
11. PROVISIONS
CURRENT
Employee benefits
Project losses
Insurance
Onerous contracts
Warranty
Other
NON-CURRENT
Employee benefits
Onerous contracts
Warranty
Other
176
Worley
11. PROVISIONS (CONTINUED)
RECONCILIATIONS
Reconciliations of each class of current and non-current provision at the beginning and end of the current and previous financial years are set out below:
CURRENT
Balance at 1 July 2021
Additional provisions
Transfers
Release of unused provision
Amounts utilized
Differences arising from translation of foreign operations
Balance at 30 June 2022
Balance at 1 July 2020
Additional provisions
Transfers
Release of unused provision
Amounts utilized
Differences arising from translation of foreign operations
Balance at 30 June 2021
NON-CURRENT
Balance at 1 July 2021
Additional provisions
Transfers
Release of unused provision
Amounts utilized
Differences arising from translation of foreign operations
Balance at 30 June 2022
Balance at 1 July 2020
Additional provisions
Transfers
Release of unused provision
Amounts utilized
Differences arising from translation of foreign operations
Balance at 30 June 2021
CONSOLIDATED
EMPLOYEE
BENEFITS
$’M
PROJECT
LOSSES
$’M
INSURANCE
$’M
ONEROUS
CONTRACTS
$’M
WARRANTY
$’M
OTHER
$’M
405
364
(13)
(9)
(328)
6
425
469
229
-
(16)
(259)
(18)
405
126
19
-
(32)
(34)
(3)
76
140
29
-
-
(41)
(2)
126
27
6
-
(2)
(5)
2
28
29
4
-
(2)
(3)
(1)
27
19
-
-
(3)
(6)
1
11
16
23
6
(1)
(25)
-
19
5
14
-
(7)
(4)
2
10
9
1
-
-
(4)
(1)
5
84
1
24
(22)
(25)
(2)
60
56
4
25
-
(1)
-
84
CONSOLIDATED
EMPLOYEE
BENEFITS
$’M
ONEROUS
CONTRACTS
$’M
WARRANTY
$’M
OTHER
$’M
83
9
13
(9)
(6)
5
95
79
49
-
-
(40)
(5)
83
2
-
-
-
(1)
(1)
-
7
1
(6)
-
-
-
2
20
8
-
(2)
-
(1)
25
14
7
-
-
(1)
-
20
32
-
(24)
(7)
(1)
1
1
28
31
(25)
-
(2)
-
32
RECOGNITION AND MEASUREMENT
Provisions are recognized when the consolidated entity has a legal, equitable or constructive obligation to make a future sacrifice of economic benefits to
other entities as a result of past transactions or other past events, it is probable that a future sacrifice of economic benefits will be required, and a reliable
estimate can be made of the amount of the obligation.
Employee benefits
Provision is made for employee benefits accumulated as a result of employees rendering services up to the reporting date. These benefits include wages and
salaries, annual leave, sick leave, severance pay, and long service leave.
Liabilities arising in respect of wages and salaries, annual leave, sick leave, and any other employee benefits expected to be settled within 12 months of the
reporting date are measured at their nominal amounts based on remuneration rates which are expected to be paid when the liability is settled. All other
employee benefits or liabilities are measured at the present value of the estimated future cash outflows to be made in respect of services provided by the
employees up to the reporting date. In determining the present value of future cash outflows, the high-quality corporate bond rate with terms to maturity
approximating the terms of the related liability is used.
Project losses
Where additional costs are expected to be incurred on a project but where timing and exact magnitude are uncertain, a provision is recognized using
management's best estimate based on the project circumstances. Additionally, where the outcome for a services contract is expected to result in an overall
loss over the life of the project, this loss is provided for when it first becomes known that a loss will be incurred.
Annual Report 2022
177
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
11. PROVISIONS (CONTINUED)
Insurance
Provision for insurance liabilities is recognized in line with actuarial calculations of unsettled insurance claims, net of insurance recoveries. The provision is
based on the aggregate number of individual claims incurred but not reported that are lower in value than the insurance deductible of the consolidated entity.
It is based on the estimated cost of settling claims and consideration is given to the ultimate claim size, future inflation as well as the levels of compensation
awarded through the courts.
Onerous contracts
Provisions for onerous contracts are recognized when the unavoidable costs of meeting contractual obligations exceed the economic benefits expected to be
received under it.
Warranty
The Group provides a general warranty which is accounted for in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets. The
provision is estimated having regard to prior warranty experience. In calculating the liability at balance date, amounts were not discounted to their present
value as the effect of discounting was not material. It is expected that these costs will be incurred within two years of balance date.
In determining the level of provision required for warranties, the Group has made judgments in respect of the expected performance and the costs of fulfilling
the warranty. Historical experience and current knowledge have been used in determining this provision.
Other provisions
Other provisions are recognized when the Group has a present obligation (legal or constructive) other than obligations described above as a result of a past
event and where it is probable that resources will be expected to settle the obligation and the amount of such obligations can be reliably estimated.
12. CAPITAL MANAGEMENT
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to sustain future development of the
business. The Board monitors the return on equity, which the Group defines as profit after income tax expense divided by the average total shareholders’
equity, excluding non-controlling interests. The Board also determines the level of dividends to ordinary shareholders.
The Board seeks to maintain a balance between the higher returns that might be possible with higher levels of borrowings and the advantages and security
afforded by a sound capital position.
The Board monitors this through the gearing ratio (net debt/net debt plus total equity), the size of available banking facilities and the assessment
of the outlook for the Group operations. The target for the Group’s gearing ratio is between 25% and 35%. The gearing ratio at 30 June 2022 and 30 June 2021
was as follows:
Total interest-bearing loans and borrowings excluding lease liabilities1
Add: Lease liabilities
Less: cash and cash equivalents2
Net debt
Total equity
Gearing
There were no changes in the Group’s approach to capital management during the financial year.
The Group and its subsidiaries have complied with all externally imposed capital requirements.
CONSOLIDATED
2022
$’M
1,914
267
(519)
1,662
5,683
22.6%
2021 RESTATED
$’M
1,761
311
(526)
1,546
5,584
21.7%
1 Excluding capitalized borrowing costs.
2 Includes procurement and restricted cash.
178
Worley
13. INTEREST BEARING LOANS AND BORROWINGS AND LEASE LIABILITIES
Current
Notes payable
Unsecured bank loans
Bank overdraft
Lease liabilities
Capitalized borrowing costs
Non-current
Notes payable
Unsecured bank loans
Lease liabilities
Capitalized borrowing costs
FY2022
CONSOLIDATED
2022
$’M
296
181
-
90
(3)
564
758
679
177
(9)
1,605
2021
$’M
-
102
33
112
(1)
246
1,068
558
199
(12)
1,813
There were no significant changes to interest bearing loans or borrowings facilities during the year ended 30 June 2022. Subsequent to 30 June 2022, the
Group successfully converted two existing bilateral facilities to sustainability linked loans ($172m). Both the sustainability linked loans conditions are linked
to reduction in Scope 1 and 2 emissions for the Group. These loans are consistent with the Group’s ambition.
FY2021
In the second half of FY2021, the group issued a EUR500 million sustainability-linked bond under a Euro medium term note program. The bond has a five
year maturity, has a fixed interest rate of 0.875% and was priced at a yield of 0.99%. Proceeds have been used for general corporate purposes and to
refinance the group's existing bank facilities.
RECOGNITION AND MEASUREMENT
Interest bearing loans and borrowings
Loans and borrowings are initially recognized at fair value, net of transaction costs incurred. Loans and borrowings are subsequently measured at amortized
cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognized in the Statement of Financial Performance
over the period of the loan using the effective interest rate method.
Lease liabilities
The Group defines a lease as a contract, or part of a contract, that conveys the right to control the use of an asset (the underlying asset) for a period of time in
exchange for consideration. At inception or on reassessment of a contract that contains a lease component, the Group allocates the consideration in the
contract to each lease and non-lease component on the basis of their relative stand-alone price.
The vast majority of the Group's leases are properties, with a small portion comprised of leases of construction equipment, vehicles and IT equipment.
As a lessee, the Group uses a single model for all incoming rentals and, at lease commencement date, recognizes a ROU asset representing the Group’s right
to use the underlying leased asset and a lease liability representing its obligation to make lease payments.
At the lease commencement date, the lease liability is measured at the present value of the lease payments that are not paid at the commencement date,
discounted using the interest rate implicit in the lease, or, if that cannot be readily determined, the applicable incremental borrowing rate. Subsequently, the
lease liability is adjusted for interest and lease payments, as well as the impact of lease modifications. It is remeasured when there is a change in future lease
payments arising from changes in the assessment of whether a purchase or extension option is reasonably certain to be exercised or a termination option is
reasonably certain not to be exercised, and under some other special circumstances. The Group applies judgment to determine the lease term for some
leases in which it is a lessee that include renewal options.
Some property leases contain extension options or termination options exercisable by the Group before the end of the non-cancellable contract period. The
Group assesses at lease commencement date whether it is reasonably certain to exercise the extension or termination option. These are reassessed if there
is a significant event or changes in circumstance within its control.
Finance costs
Borrowing costs are recognized as expenses in the period in which they are incurred, except when they are included in the costs of qualifying assets. A
qualifying asset is defined as an asset that necessarily takes a substantial period of time to get ready for its intended use or sale. Borrowing costs include:
• interest on bank overdrafts, and short term and long term loans and borrowings;
• amortization of discounts or premiums relating to loans and borrowings and non-current payables; and
• lease liability interest.
Included in the total finance costs of $64 million (2021: $83 million) disclosed in the Statement of Financial Performance and Other Comprehensive Income is
$12 million recognized on lease liabilities (2021: $16 million).
Annual Report 2022
179
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
13. INTEREST BEARING LOANS AND BORROWINGS AND LEASE LIABILITIES (CONTINUED)
TERMS AND CONDITIONS
Notes payable
Unsecured notes payable on the Group's Statement of Financial Position as at 30 June 2022 were issued in the EURO market and listed on the Singapore
exchange and in the United States private debt capital market in June 2021 and September 2012 as follows:
AMOUNT, MILLION
EURO 500
USD 205
DATE OF ISSUE
June 2021
September 2012
DATE OF MATURITY
June 2026
September 2022
FIXED COUPON PER ANNUM
0.88%
4.00%
In FY2021, unsecured notes payable of USD 175 million issued in the United States private debt capital market in March 2011 matured and was repaid in
March 2021, and cross currency swaps entered into alongside these notes also expired in March 2021.
Unsecured bank loans
Unsecured bank loans are floating interest rate debt facilities and are subject to negative pledge arrangements which require the Group to comply with
certain minimum financial requirements.
14. CHANGES IN LIABILITIES ARISING FROM FINANCING ACTIVITIES
The movements in financial liabilities and related financial assets are as follows:
2022
Current interest bearing loans and borrowings
Non-current interest bearing loans and borrowings
Lease liabilities
Liabilities
2021
Current interest bearing loans and borrowings
Non-current interest bearing loans and borrowings
Lease liabilities
Liabilities
AS AT
1 JULY
$'M
135
1,626
311
2,072
477
1,390
435
2,302
RECLASSIFICATION
$'M
CASH FLOWS
$'M
FOREIGN EXCHANGE
MOVEMENTS
$'M
OTHER1
$'M
293
(293)
-
-
54
(54)
-
-
48
89
(110)
27
(339)
344
(136)
(131)
1
15
15
31
(57)
(54)
(7)
(118)
-
-
51
51
-
-
19
19
AS AT
30 JUNE
$'M
477
1,437
267
2,181
135
1,626
311
2,072
2022
NUMBER OF SHARES
$’M NUMBER OF SHARES
$’M
2021
CONSOLIDATED
15. ISSUED CAPITAL
Ordinary shares, fully paid2
Special voting share
(A) MOVEMENTS IN SHARES
Balance at the beginning of the financial year
Ordinary shares issued on redemption of exchangeable shares
Exchangeable shares exchanged for ordinary shares
Transfer from performance rights reserve on issuance of shares
524,644,041
1
524,644,042
5,341
-
5,341
523,079,821
1
523,079,822
2022
2021
NUMBER OF SHARES
523,079,822
80,000
(80,000)
1,564,220
$’M NUMBER OF SHARES
521,477,246
-
-
1,602,576
5,321
2
(2)
20
Balance at the end of the financial year
524,644,042
5,341
523,079,822
5,321
-
5,321
$’M
5,301
-
-
20
5,321
RECOGNITION AND MEASUREMENT
Issued and paid up capital is recognized at the fair value of the consideration received by the Group. Any transaction costs arising on the issue of ordinary
shares are recognized directly in equity as a reduction of the share proceeds received.
1 Represents new leases entered, interest expense not yet paid net of changes in lease term on termination options reasonably certain to be exercised.
2 Included in ordinary shares are 926,193 (2021: 1,006,193) exchangeable shares. The issuance of the exchangeable shares and the attached special voting share replicate the
economic effect of issuing ordinary shares in the Company. Accordingly, for accounting purposes, exchangeable shares are treated in the same single class of issued capital as
ordinary shares. In addition, the Australian Securities Exchange (ASX) treats these exchangeable shares to have been converted into ordinary shares of the Company at the time of
their issue for the purposes of the ASX Listing Rules. Ordinary shares have no par value and the Company does not have a limited amount of authorized capital. The Worley
Limited Plans Trust holds nil (30 June 2021: nil) shares in the Company, which have been consolidated and eliminated in accordance with the accounting standards.
180
Worley
15. ISSUED CAPITAL (CONTINUED)
(B) TERMS AND CONDITIONS OF ISSUED CAPITAL
Ordinary shares
Ordinary shares have the right to receive dividends as declared and, in the event of the winding up of the Company, to participate in the proceeds from the
sale of all surplus assets in proportion to the number of, and amounts paid up on, shares held. Ordinary shares entitle their holder to one vote, either in
person or by proxy, at a meeting of the Company.
Exchangeable shares
The exchangeable shares were issued by Worley Canada SPV Limited as part of the consideration for the acquisition of the Colt Group. Exchangeable shares
may be exchanged into ordinary shares of the Company on a one for one basis (subject to adjustments) at any time by the exchangeable shareholders.
Exchangeable shares have the right to receive the same cash dividends or cash distributions as declared on the ordinary shares into which they are
convertible. In the event of the winding up of the Company, the exchangeable shares would convert to ordinary shares, which would participate in the
proceeds from the sale of all surplus assets pro-rata with other ordinary shares.
The exchangeable shares, through a voting trust which holds a special voting share in the Company, entitle their holders to vote at the Company’s general
meetings as though they hold ordinary shares. During the financial year ended 30 June 2022, 80,000 were exchanged (2021: nil).
Special voting share
The special voting share was issued to Computershare Trust Company of Canada Limited (Trustee) as part of the consideration for the acquisition of the Colt
Group. The special voting share does not have the right to receive dividends as declared, and in the event of the winding up of the Company is unable to
participate in the proceeds from the sale of all surplus assets. The special voting share has a right to vote together as one class of share with the holders of
ordinary shares in the circumstances in which shareholders have a right to vote, subject to the Company’s Constitution and applicable law. The Trustee must
vote in the manner instructed by an exchangeable shareholder in respect of the number of votes that would attach to the ordinary shares to be received by
that exchangeable shareholder on exchange of its exchangeable shares. The special voting share has an aggregate number of votes equal to the number of
votes attached to ordinary shares into which the exchangeable shares are retracted or redeemed.
(C) PERFORMANCE RIGHTS
The policy in respect of performance rights is outlined in note 5.
Balance at the beginning of the financial year
Rights granted
Rights exercised
Rights lapsed or expired
Balance at the end of the financial year
Exercisable at the end of the financial year
Weighted average exercise price
Performance rights
The outstanding balance as at 30 June 2022 is represented by:
•
447,153 performance rights, vesting on 30 Sep 2022 and expiring on 29 Oct 2026
•
•
•
•
•
•
•
•
•
1,335,527 performance rights, vesting on 30 Sep 2022 and expiring on 31 Oct 2027
68,428 performance rights, vesting on 30 Sep 2022 and expiring on 1 Apr 2028
343,598 performance rights, vesting on 30 Sep 2023 and expiring on 29 Oct 2026
669,965 performance rights, vesting on 30 Sep 2023 and expiring on 31 Oct 2027
8,303 performance rights, vesting on 30 Sep 2023 and expiring on 1 Apr 2028
1,656,263 performance rights, vesting on 30 Sep 2023 and expiring on 31 Oct 2028
551,505 performance rights, vesting on 30 Sep 2024 and expiring on 31 Oct 2027
688,314 performance rights, vesting on 30 Sep 2024 and expiring on31 Oct 2028
719,751 performance rights, vesting on 30 Sep 2025 and expiring on 31 Oct 2028
Weighted average remaining contractual life
The weighted average remaining life for the rights outstanding as at 30 June 2022 is 1.4 years (2021: 1.3 years).
Weighted average fair value
The weighted average fair value of rights granted during the financial year was $9.42 (2021: $8.05).
NUMBER OF
PERFORMANCE RIGHTS
2022
2021
6,386,386
3,221,379
(1,564,220)
(1,554,738)
5,730,966
3,192,277
(1,602,576)
(934,281)
6,488,807
6,386,386
nil
$nil
nil
$nil
Annual Report 2022
181
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
15. ISSUED CAPITAL (CONTINUED)
KEY ESTIMATES
Pricing model
The following table lists the inputs to the models used for the financial years ended 30 June 2022 and 30 June 2021:
Dividend yield (%)
Expected volatility (%)1
Risk-free interest rate (%)
Expected life of rights (years)
Rights exercise price ($)
Weighted average share price at measurement date ($)
16. RESERVES
Foreign currency translation reserve
Hedge reserve
Performance rights reserve
Defined benefits reserve
Acquisition reserve
PERFORMANCE RIGHTS
PLAN TSR, EPS AND SPPR
2022
2021
4.79-5.06
42.5
0.00-0.79
2-4
nil
10.82
4.95-5.37
50
0.09-0.28
2-4
nil
9.41
CONSOLIDATED
2022
$’M
(301)
(3)
60
14
(72)
(302)
2021
$’M
(510)
2
67
-
(64)
(505)
(A) FOREIGN CURRENCY TRANSLATION RESERVE
The foreign currency translation reserve is used to record foreign exchange differences arising from the translation of the financial statements of foreign
controlled entities and associates, and the net investments hedged in their entities.
(B) HEDGE RESERVE
The hedge reserve is used to record gains or losses on hedging instruments used in the cash flow hedges that are recognized directly in equity. Amounts are
recognized in the Statement of Financial Performance when the associated hedged transaction affects the profit and loss.
No amount was recognized in the Statement of Financial Performance in relation to hedge ineffectiveness for the year ended 30 June 2022 (2021: nil).
RECOGNITION AND MEASUREMENT
Specific hedges
Hedging is undertaken to avoid or minimize potential adverse financial effects of movements in foreign currency exchange rates. Gains or losses arising upon
entry into a hedging transaction intended to hedge the purchase or sale of goods or services, together with subsequent foreign exchange gains or losses
resulting from those transactions, are deferred up to the date of the purchase or sale and included in the measurement of the purchase or sale.
Foreign exchange gains and losses arising from a monetary item receivable from or payable to a foreign operation, the settlement of which is neither planned
nor likely in the foreseeable future, are considered to form part of a net investment in a foreign operation and are recognized directly in equity in the foreign
currency translation reserve.
At each balance date, the Group measures the effectiveness of its cash flow hedges. The effective portion of the gain or loss on the hedging instrument is
recognized directly in equity, while the ineffective portion is recognized in the profit and loss. The following effectiveness criteria are applied:
• An economic relationship exists between the hedged item and hedging instrument;
• The effect of credit risk does not dominate the fair value changes; and
• The hedge ratio applied for hedge accounting purposes should be the same as the hedge ratio used for risk management purposes.
(C) PERFORMANCE RIGHTS RESERVE
The performance rights reserve is used to recognize the fair value of performance rights issued but not vested.
(D) DEFINED BENEFITS RESERVE
The defined benefits reserve is used for remeasurements of the net defined benefit liability, which comprise actual gains and losses, the return on plan
assets (if applicable) and any asset ceilings where applicable.
(E) ACQUISITION RESERVE
The acquisition reserve is used to record differences between the carrying value of non-controlling interests before acquisition and the consideration paid
upon acquisition of an additional shareholding, where the transaction does not result in a loss of control. The Group increased its share of Jacobs Zamil and
Turbag Consulting Engineers Company, and Jacobs DCSA Saudi Arabia Co Ltd to 100% during the year ended 30 June 2022.
1 The expected volatility was determined based on the historical share price volatility of the Company. The resulting expected volatility therefore reflects the assumption that the
historical volatility is indicative of future trends, which may not necessarily be the actual outcome.
182
Worley
17. EARNINGS PER SHARE
ATTRIBUTABLE TO MEMBERS OF WORLEY LIMITED
Basic earnings per share
Diluted earnings per share
The following reflects the income and security data used in the calculation of basic and diluted earnings per share:
(A) RECONCILIATION OF EARNINGS USED IN CALCULATING EARNINGS PER SHARE
Earnings used in calculating basic and diluted earnings per share
(B) WEIGHTED AVERAGE NUMBER OF SHARES USED AS THE DENOMINATOR
Weighted average number of ordinary securities used in calculating basic earnings per share
Performance rights which are considered potentially dilutive
Adjusted weighted average number of ordinary securities used in calculating diluted earnings per share
CONSOLIDATED
2022
CENTS
2021 RESTATED
CENTS
32.8
32.6
$’M
172
15.7
15.6
$’M
82
Number
524,248,439
2,819,755
Number
522,675,378
3,770,681
527,068,194
526,446,059
Within the total number of performance rights which are considered dilutive, the weighted average number of converted, lapsed or cancelled potential
ordinary shares used in calculating diluted earnings per share was 85,491 (2021: 18,093).
MEASUREMENT
Basic earnings per share
Basic earnings per share is determined by dividing the profit attributable to members of Worley Limited by the weighted average number of ordinary shares
outstanding during the financial year.
Diluted earnings per share
Diluted earnings per share is calculated as profit attributable to members of Worley Limited adjusted for:
• costs of servicing equity (other than dividends);
• the after-tax effect of dividends and interest associated with dilutive potential ordinary shares that have been recognized as expenses; and
• other non-discretionary changes in revenues or expenses during the period that would result from the dilution of potential ordinary shares, divided by the
weighted average number of ordinary shares and dilutive potential ordinary shares, adjusted for any bonus element.
18. DIVIDENDS
(A) FINAL DIVIDEND PROPOSED
Dividend in respect of the six months to 30 June 2022:
25.0 cents per share
Dividend in respect of the six months to 30 June 2021:
25.0 cents per share
CONSOLIDATED
2022
$’M
2021
$’M
131
-
-
131
The directors have resolved to pay a final dividend of 25.0 cents per fully paid ordinary share, including exchangeable shares, unfranked (2021: 25.0 cents per
share). The Company will make total dividend payments of 50.0 cents per share for the financial year ended 30 June 2022 (2021: 50.0 cents per share).
The final dividend will be paid on 28 September 2022 for shareholders on the register at the record date, being 30 August 2022.
In accordance with AASB 110 Events after the Reporting Period, the aggregate amount of the proposed final dividend of $131 million is not recognized as a
liability as at 30 June 2022.
(B) DIVIDENDS PAID DURING THE FINANCIAL YEAR
25.0 cents per share (unfranked) dividend in respect of the six months to 31 December 2021
25.0 cents per share (unfranked) dividend in respect of the six months to 30 June 2021
25.0 cents per share (unfranked) dividend in respect of the six months to 31 December 2020
25.0 cents per share (unfranked) dividend in respect of the six months to 30 June 2020
131
131
n/a
n/a
262
n/a
n/a
131
130
261
Annual Report 2022
183
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
19. FINANCIAL RISK MANAGEMENT
(A) OVERVIEW
The Group’s principal financial instruments comprise receivables, payables, bank loans and overdrafts, lease liabilities, cash and short term deposits and
derivatives. The Group has exposure to the following risks from its use of financial instruments:
• credit risk;
• liquidity risk; and
• market risk.
This note presents information about the Group’s exposure to each of the above risks, its objectives, policies and processes for measuring and managing risk,
and the management of capital. Quantitative disclosures are included throughout this financial report.
The Board has overall responsibility for the establishment and oversight of the risk management framework. The Audit and Risk Committee assists the
Board in overseeing the integrity of the Group’s financial reporting risk management framework and internal controls. The Committee is assisted in its
oversight role by Internal Audit. Internal Audit undertakes both regular and ad hoc reviews of risk management controls and procedures, the results of which
are reported to the Committee.
Risk management policies are established to identify and analyze the risks faced by the Group, to set appropriate risk limits and controls, and to monitor risks
and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Group’s activities. The
Group, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all
employees understand their roles and obligations.
(B) CREDIT RISK
Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations. The financial
assets of the Group comprise cash and cash equivalents, trade and other receivables, derivative financial instruments and guarantees and letters of credit
which are presented as contingent liabilities in note 25(A). The Group’s maximum exposure to credit risk is equal to the carrying amount of these instruments.
Exposure at balance date is addressed in each applicable note. Credit exposure includes derivative instruments in an asset position at balance date.
Trade and other receivables
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The profiles of the Group’s customer base,
including the default risk of the industry and country in which customers operate, have less of an influence on credit risk. Geographically and on a customer
basis, there is no concentration of credit risk.
The Group has a credit policy under which each new customer is analyzed for creditworthiness before the Group’s standard payment and delivery terms and
conditions are offered. The Group’s review includes external ratings, when available, and in some cases bank references.
The Group has established an allowance for expected credit losses that represents its estimate of expected credit losses in respect of trade and other
receivables.
Guarantees
Details of outstanding guarantees are provided in note 25(A). The Group is, in the normal course of business, required to provide guarantees and letters of
credit on behalf of controlled entities, associates and related parties in respect of their contractual performance related obligations.
Maximum credit exposure
The carrying amount of the Group’s financial assets represents the maximum credit exposure. The Group’s maximum exposure to credit risk at the reporting
date was:
Cash and cash equivalents
Trade receivables, unbilled contract revenue and retentions, net of ECL allowance
Other receivables
Amounts receivable from associates and related parties
Derivatives
The ageing of the Group’s trade receivables, unbilled contract revenue and retentions at the reporting date was:
0-60 days
Past due 61-120 days
Gross aged receivables 0-120 days
Gross receivables more than 121 days
Total
184
Worley
GROSS
2022
$’M
1,879
95
1,974
338
2,312
ECL ALLOWANCE
2022
$'M
-
-
(10)
(70)
(80)
CARRYING AMOUNT
CONSOLIDATED
2022
$’M
519
2,232
143
37
3
2,934
GROSS
2021
$’M
1,732
72
1,804
319
2,123
2021
$’M
526
2,070
204
26
4
2,830
ECL ALLOWANCE
2021
$'M
-
-
(13)
(40)
(53)
19. FINANCIAL RISK MANAGEMENT (CONTINUED)
The Group applies the simplified approach in calculating Expected Credit Losses (ECLs). Therefore, the Group does not track changes in credit risk, but instead
recognizes an allowance based on lifetime ECLs at each reporting date. The Group has established a provision matrix that is based on its historical credit loss
experience, adjusted for forward-looking factors specific to the debtors and the economic environment.
The allowance amounts are used to record impairment losses unless the Group is satisfied that no recovery of the amount owing is possible; at that point,
the amount is considered irrecoverable and is written off against the financial asset directly.
(C) LIQUIDITY RISK
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to managing liquidity is to
ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without
incurring unacceptable losses or risking damage to the Group’s reputation.
The Group ensures that it has sufficient cash on demand to meet expected operational expenses including the servicing of financial obligations; this excludes
the potential impact of extreme circumstances that cannot reasonably be predicted.
The Group has unrestricted access at balance date to the following lines of credit:
UNSECURED FACILITIES
Total facilities available:
Loan facilities
Overdraft facilities
Lease liabilities
Bank guarantees and letters of credit
Facilities utilized at balance date:
Loan facilities1
Overdraft facilities
Lease liabilities
Bank guarantees and letters of credit
Facilities available at balance date:
Loan facilities
Overdraft facilities
Lease liabilities
Bank guarantees and letters of credit
The maturity profile in respect of the Group's total unsecured loan, overdraft facilities and lease liabilities is set out below:
Within one year
Between one and four years
After four years
CONSOLIDATED
2022
$’M
2021
$’M
2,730
126
267
1,923
5,046
1,914
-
267
1,150
3,331
816
126
-
773
2,480
235
311
1,685
4,711
1,719
41
311
931
3,002
761
194
-
754
1,715
1,709
809
2,289
25
3,123
465
1,729
832
3,026
1 Excludes capitalized borrowing costs.
Annual Report 2022
185
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
19. FINANCIAL RISK MANAGEMENT (CONTINUED)
The table below analyzes the Group’s financial liabilities into relevant maturity groupings based on the remaining period from balance date to the contractual
maturity date. As the amounts disclosed in the table are the contractual undiscounted cash flows, their balances will not necessarily agree with the amounts
disclosed in the Statement of Financial Position.
As at 30 June 2022
Due within one year
Due between one and four years
Due after four years
As at 30 June 2021
Due within one year
Due between one and four years
Due after four years
TRADE AND OTHER
PAYABLES
$’M
AMOUNTS PAYABLE
TO ASSOCIATES AND
RELATED PARTIES
$’M
CONSOLIDATED
INTEREST BEARING
LOANS AND
BORROWINGS AND
LEASE LIABILITIES
$’M
EXPECTED
FUTURE
INTEREST PAYMENTS
$’M
DERIVATIVES
$’M
928
53
-
981
981
44
-
1,025
4
-
-
4
-
-
-
-
577
1,601
26
2,204
248
993
832
2,073
35
38
1
74
42
65
9
116
32
-
-
32
10
-
-
10
TOTAL
FINANCIAL
LIABILITIES
$’M
1,576
1,692
27
3,295
1,281
1,102
841
3,224
(D) MARKET RISK
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices, will affect the Group’s income or the
value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable
parameters, while optimizing the return. The Group enters into derivatives, and also incurs financial liabilities, in order to manage market risk. Generally, the
Group seeks to apply hedge accounting in order to reduce volatility in the profit and loss.
(i) Currency risk
The Group is exposed to currency risk on sales, purchases and borrowings that are denominated in a currency other than the respective functional currencies
of Group entities. In the ordinary course of business, the Group structures its contracts to be in the functional currency of the country where the work is
performed and costs incurred.
The Group uses forward exchange contracts and foreign currency options to hedge its currency risk, most with a maturity of less than one year from the
reporting date. When necessary, forward exchange contracts are rolled over at maturity.
Interest on loans and borrowings is denominated in currencies that match the cash flows generated by the underlying operations for the Group resulting in
an economic hedge. Interest is primarily AUD, CAD, GBP and USD denominated.
A number of the Group controlled entities have a functional currency other than AUD. The exchange gains or losses on the net equity investment of foreign
operations are reflected in the foreign currency translation reserve within the equity attributable to members of Worley Limited. Currency exposure arising
from the net assets of the Group’s foreign operations is managed primarily through borrowings denominated in the relevant foreign currencies.
(1) CROSS CURRENCY SWAPS
The Group has previously used cross currency swaps (CCS) to hedge its foreign currency interest rate risk which have matured during the prior year. This
swap was to buy USD and sell CAD, and matured on 24 March 2021.
186
Worley
19. FINANCIAL RISK MANAGEMENT (CONTINUED)
(2) FORWARD EXCHANGE CONTRACTS
The Group is exposed to foreign exchange rate transaction risk on foreign currency sales and purchases, and loans to and from related entities. The most
significant foreign exchange risk is USD receipts by Australian and other non-US entities. When required, hedging is undertaken through transactions entered
into in the foreign exchange markets. Forward exchange contracts have been used for hedging purposes and are generally accounted for as cash
flow hedges.
At balance date, the details of significant outstanding contracts were:
Maturing in the next 6 months from the reporting date
BUY AUD and Sell USD
Buy AUD and Sell CAD
Buy CAD and Sell USD
Buy NOK and Sell USD
Buy NOK and Sell AUD
Buy EUR and Sell USD
Buy GBP and Sell AUD
Buy GBP and Sell RUB
Buy GBP and Sell USD
Buy RUB and Sell GBP
WEIGHTED AVERAGE
EXCHANGE RATE
AMOUNT
RECEIVABLE/(PAYABLE)
AMOUNT
RECEIVABLE/(PAYABLE)
2022
2021
2022
$’M
2022
$’M
2021
$’M
2021
$’M
0.73
0.92
-
8.93
6.48
0.89
0.54
-
0.75
-
0.75
-
1.28
8.76
6.54
0.84
0.55
0.01
0.74
0.01
AUD 11
AUD 25
-
NOK 1,070
NOK 260
EUR 35
GBP 12
-
GBP 6
-
USD (7)
CAD (23)
-
USD (116)
AUD (40)
USD (41)
AUD (22)
-
USD (7)
-
AUD 16
-
CAD 28
NOK 563
NOK 240
EUR 35
GBP 18
GBP 5
GBP 6
RUB 565
USD (12)
-
USD (23)
USD (68)
AUD (37)
USD (42)
AUD (32)
RUB (565)
USD (8)
GBP (5)
As these contracts are hedging anticipated future receipts and sales, to the extent that they satisfy hedge accounting criteria, any unrealized gains and losses
on the contracts, together with the cost of the contracts, are deferred and will be recognized in the measurement of the underlying transaction provided the
underlying transaction is still expected to occur as originally designated. Included in the amounts deferred are any gains and losses on hedging contracts
terminated prior to maturity where the related hedged transaction is still expected to occur as designated.
The timescale (future cash flow timings) of the foreign exchange forward contracts is in line with future detailed forecast cash flows in foreign currencies.
Start dates and completion dates are tracked and the transactions are based on won projects and are highly probable to occur, resulting in ineffectiveness
which is insignificant. The change in fair values between the hedging instrument and item are materially the same, with the proportion of the risk that is
hedged being at or near 100%.
The gains and losses deferred in the Statement of Financial Position were as follows:
Effective hedge – unrealized gains
Effective hedge – unrealized losses
Net unrealized losses
CONSOLIDATED
2022
$’M
3
(8)
(5)
(3) FOREIGN CURRENCY RISK EXPOSURE
The following are financial assets and liabilities (unhedged amounts) in currencies other than the functional currencies of the entity in which they are
recorded:
CONSOLIDATED
As at 30 June 2022
Cash and cash equivalents
Trade receivables
Trade payables
As at 30 June 2021
Cash and cash equivalents
Trade receivables
Trade payables
CAD
$’M
25
-
-
25
1
8
(1)
8
GBP
$’M
5
-
(2)
3
6
4
(10)
-
USD
$’M
79
43
(38)
84
91
64
(96)
59
EUR
$’M
4
6
(9)
1
6
30
(54)
(18)
2021
$’M
-
-
-
OTHER
$’M
37
6
(4)
39
44
42
(12)
74
Annual Report 2022
187
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
19. FINANCIAL RISK MANAGEMENT (CONTINUED)
(4) CURRENCY SENSITIVITY ANALYSIS
A 10% weakening of the Australian dollar against the following currencies at 30 June 2022 in relation to the preceding foreign currency exposures would have
impacted equity and profit by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant.
CONSOLIDATED
2022
2021
EFFECTS IN MILLIONS OF AUD
EQUITY
PROFIT
EQUITY
PROFIT
CAD
GBP
USD
EUR
Other
-
-
-
-
-
2
-
9
-
3
-
-
-
-
-
1
-
6
(2)
5
A 10% strengthening of the Australian dollar against the above currencies at 30 June 2022 would have had the equal but opposite effect on the above
currencies to the amounts shown above, on the basis that all other variables remain constant.
The following significant exchange rates against the AUD applied during the financial year:
CAD
GBP
USD
EUR
AVERAGE
EXCHANGE RATE
REPORTING DATE
SPOT EXCHANGE RATE
2022
2021
2022
2021
0.9183
0.5449
0.7256
0.6436
0.9575
0.5547
0.7470
0.6261
0.8909
0.5686
0.6919
0.6600
0.9290
0.5426
0.7468
0.6302
(ii) Interest rate risk
Interest rate risk is the risk that changes in interest rates will affect the Group’s income or the value of its holdings of financial instruments.
(1) INTEREST RATE RISK EXPOSURES
The Group’s exposure to interest rate risk and the effective weighted average interest rate by maturity periods are set out in the following table:
WEIGHTED
AVERAGE
INTEREST
RATE
% PA
FLOATING
INTEREST
RATE
$'M
1 YEAR
OR LESS
$'M
1 TO
2 YEARS
$'M
2 TO
3 YEARS
$'M
3 TO
4 YEARS
$'M
4 TO
5 YEARS
$'M
MORE THAN
5 YEARS
$'M
NON-INTEREST
BEARING
$'M
TOTAL
$'M
As at 30 June 2022
Cash and cash equivalents
Bank loans 1
Notes payable
Lease liabilities
As at 30 June 2021
Cash and cash equivalents
Bank loans
Notes payable
Lease liabilities
2.9
3.1
1.8
4.3
1.5
2.1
1.7
5.3
519
-
-
-
526
-
-
-
-
181
296
90
-
102
-
112
-
679
-
69
-
54
275
74
-
-
-
49
-
347
-
52
-
-
758
34
-
157
-
34
-
-
-
21
-
-
793
22
-
-
-
4
-
-
-
17
-
-
-
-
-
-
-
-
519
860
1,054
267
526
660
1,068
311
Only bank loans and cash and cash equivalents in the table above are at floating interest rates with the effect of changes in interest rates of 1% changing net
finance costs by 4%. Notes payable are at fixed interest rates. Lease liabilities are recognized at the incremental borrowing rates at inception of the lease that
do not change unless there are certain modifications or remeasurements to the lease.
1 Excludes capitalized borrowing costs.
188
Worley
20. FAIR VALUES
DETERMINATION OF FAIR VALUES
The Group’s accounting policies and disclosures require the determination of fair value for both financial and non-financial assets and liabilities. Fair values
have been determined for measurement and/or disclosure purposes based on the following methods. When applicable, further information about the
assumptions used in determining fair values is disclosed in the notes specific to that asset or liability.
Derivatives
The fair value of forward exchange contracts is estimated by discounting the difference between the contractual forward price for the residual maturity of the
contract using a risk-free interest rate (based on government bonds). The fair value of interest rate swaps is based on broker quotes. Those quotes are tested
for reasonableness by discounting estimated cash flows based on the terms and maturity of each contract and using market interest rates for similar
instruments at the measurement date.
Non-derivative financial liabilities
Fair value which is determined for disclosure purposes is the price that would be paid to transfer a liability in an orderly transaction between market
participants at the measurement date. For lease liabilities, the market rate of interest is determined by reference to similar lease agreements.
FAIR VALUES COMPARED TO CARRYING AMOUNTS
The fair values of financial assets and liabilities approximate their carrying values with the exception of interest bearing loans and borrowings and lease
liabilities which have a fair value of $2,145 million (2021: $2,075 million) and a carrying value of $2,169 million (2021: $2,059 million).
The Group uses the following hierarchy for determining the fair value of a financial asset or liability:
• Level 1 – the fair value is calculated using quoted prices in active markets.
• Level 2 – the fair value is estimated using inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly
(as prices) or indirectly (derived from prices). The Group's interest bearing loans and borrowings and derivative instruments including forward exchange
contracts fall within Level 2 of the hierarchy.
• Level 3 - if one or more of the significant inputs are not based on observable market data, the instrument is included in Level 3. This is the case for unlisted
equity instruments.
Derivative instruments including interest rate swaps and forward exchange contracts are restated to fair values at each reporting date based on market
observable inputs such as foreign exchange spot and forward rates, interest rate curves and forward rate curves.
Fair values of the Group’s interest bearing loans and borrowings are determined by discounting future cash flows using period-end borrowing rates on loans
and borrowings with similar terms and maturity.
There were no transfers between Level 1, 2 and 3 for the periods presented in this report.
Annual Report 2022
189
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
21. INVESTMENTS IN CONTROLLED ENTITIES
ENTITY
(A) SIGNIFICANT ENTITIES
Worley No 2 Pty Limited1
Worley Canada Services Ltd
Worley Cord Limited
Worley Engineering Pty Limited1
Worley Financial Services Pty Limited1
Worley Group Inc
Rosenberg Worley AS
Worley US Holding Corporation
Worley US Finance Sub Limited
Worley Corporation
Worley SPV1 Pty Ltd1
Worley ECR Services Inc
Worley Field Services Incorporated
Worley Nederland BV
Worley Equipment Incorporated
Worley India Private Limited
COUNTRY OF INCORPORATION
BENEFICIAL INTEREST HELD BY
CONSOLIDATED ENTITY
2022
%
2021
%
Australia
Canada
Canada
Australia
Australia
USA
Norway
USA
USA
USA
Australia
USA
USA
Netherlands
USA
India
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
100
In accordance with accounting standards, the Group discloses only significant entities identified on the basis of materiality.
(B) ACQUISITION OF CONTROLLED ENTITIES
FY2022
On 9 May 2022, the Group increased its share in Jacobs Zamil and Turbag Consulting Engineers Company to 100% for cash consideration of $26 million, of
which $13 million was paid at 30 June 2022. On the same date, the Group increased its share in Jacobs DCSA Saudi Arabia Co Ltd to 100% for cash
consideration of $19 million, of which $10 million was paid at 30 June 2022.
FY2021
On 9 July 2020, Worley acquired 50% of the shares in TW Power Services Pty Ltd ('TWPS') it did not previously own for cash consideration of $10.5 million.
TWPS is an operations and maintenance (O&M) business providing services to support critical power infrastructures across Australia, New Zealand and South
Asia.
(C) DISPOSAL OF CONTROLLED ENTITIES
FY2022
No significant disposals of controlled entities have occurred during FY2022.
FY2021
On 26 March 2021, Worley finalized the sale of the Capital Projects Advisory - Australia and New Zealand ('CPA ANZ') businesses for consideration of $48
million. CPA ANZ is a small part of Worley’s Advisian consulting business specialising in capital project delivery within the public infrastructure sector. $36
million of the consideration was received during FY2021 with the remaining funds received during FY2022. In the prior year, a gain on sale of $7 million was
recognized within the other income line of the Statement of Financial Performance, and was treated as an underlying adjustment.
(D) WITHDRAWAL FROM RUSSIA
As announced on 10 March 2022 to the ASX, Worley is continuing to safely withdraw its services provided in and into Russia and will not enter into new
contracts.
At 30 June 2022, the net assets of Russian entities is $17 million, $16 million of which is cash in bank. This cash is classified as restricted cash (refer to note
7) due to the sanctions imposed by the Russian Federation on certain countries which includes Australia. At 30 June 2022, a $14 million provision has been
recognized due to the Group's plan to withdraw from Russia (refer to note 3). This provision comprises of severance payments and write offs of certain
unbilled revenues and other assets to their recoverable values. We are continuing to take all necessary steps to ensure the Group recovers the remaining
investments in Russia.
1 Entities subject to ASIC Corporations Instrument 2016/785.
190
Worley
21. INVESTMENTS IN CONTROLLED ENTITIES (CONTINUED)
RECOGNITION AND MEASUREMENT
Controlled entities
Where control of an entity is obtained during a financial year, its results are included in the Statement of Financial Performance and Other Comprehensive
Income from the date on which control commences. Where control of an entity ceases during a financial year, its results are included for that part of the year
during which control existed.
A change in the ownership interest of a subsidiary that does not result in a loss of control is accounted for as an equity transaction.
Acquisition of assets and business combinations
The acquisition method of accounting is used to account for all business combinations regardless of whether equity instruments or other assets are acquired.
Cost is measured as the fair value of the assets given up, shares issued or liabilities undertaken or assumed at the date of acquisition. Transaction costs
directly attributable to the acquisition are expensed as incurred. Where equity instruments are issued in a business combination, the value of the instruments
is their market price as determined by market valuation at the acquisition date. Transaction costs arising on the issue of equity instruments are recognized
directly in equity.
If the business combination is achieved in stages, the acquisition date fair value of the Group’s previously held equity interest in the acquiree is remeasured to
fair value at the acquisition date through the profit and loss.
Except for non-current assets or disposal groups classified as held for sale (which are measured at fair value less costs to sell), all identifiable assets acquired
and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date, irrespective of the
extent of any non-controlling interest. The excess of the cost of the business combination over the net fair value of the Group’s share of the identifiable net
assets acquired is recognized as goodwill. If the cost of acquisition is less than the Group’s share of the net fair value of the identifiable net assets of the
subsidiary, the difference is recognized as a gain in the Statement of Financial Performance and Other Comprehensive Income but only after a reassessment
of the identification and measurement of the net assets acquired.
Where settlement of any part of the consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of
exchange. The discount rate used is the Group’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an
independent financier under comparable terms and conditions.
22. EQUITY ACCOUNTED ASSOCIATES
(A) DETAILS OF EQUITY ACCOUNTED ASSOCIATES
The Group’s largest equity accounted investments are listed below.
OWNERSHIP INTEREST
CONSOLIDATED
CARRYING AMOUNT
CONSOLIDATED
ENTITY
Significant investments
Jacobs Engineering SA Joint Ventures
DeltaAfrik Engineering Limited
Other investments
PRINCIPAL
PLACE OF
BUSINESS
PRINCIPAL ACTIVITY
Morocco
Nigeria
Chemicals
Energy
2022
%
50
50
2021
%
50
50
(B) CARRYING AMOUNT OF EQUITY ACCOUNTED ASSOCIATES
Balance at the beginning of the financial year
Acquisition of previously held equity associate
Share of net profit of investments accounted for using the equity method, excluding impairments
Dividends declared by equity accounted associates
Change in nature of investment and investment acquired
Impairment of investments in equity accounted associates
Disposal of investments
Movement in foreign currency translation reserve of equity accounted associates
Balance at the end of the financial year
2022
$’M
127
13
49
189
CONSOLIDATED
2022
$’M
172
-
8
(1)
16
-
-
(6)
189
2021
$’M
122
16
34
172
2021
$’M
198
(18)
-
(3)
3
(7)
-
(1)
172
Annual Report 2022
191
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
22. EQUITY ACCOUNTED ASSOCIATES (CONTINUED)
(C) NET PROFIT ATTRIBUTABLE TO EQUITY ACCOUNTED ASSOCIATES
Net profit of equity accounted associates
(D) REVENUE ATTRIBUTABLE TO EQUITY ACCOUNTED ASSOCIATES
Share of revenue from equity accounted associates1
(E) RESERVES ATTRIBUTABLE TO EQUITY ACCOUNTED ASSOCIATES
FOREIGN CURRENCY TRANSLATION RESERVE
Balance at the beginning of the financial year
Movement in reserve
Balance at the end of the financial year
(F) RETAINED PROFITS ATTRIBUTABLE TO EQUITY ACCOUNTED ASSOCIATES
Balance at the beginning of the financial year
Acquisition of previous equity accounted associates
Share of net profits of investments accounted for using the equity method
Impairment of investments in equity accounted associates
Dividends declared by equity accounted associates
Balance at the end of the financial year
(G) SHARE OF EQUITY ACCOUNTED ASSOCIATES’ CONTINGENT LIABILITIES
Performance related guarantees issued
(H) SHARE OF EQUITY ACCOUNTED ASSOCIATES’ EXPENDITURE COMMITMENTS
Expenditure commitments
(I) SUMMARY OF FINANCIAL POSITION OF EQUITY ACCOUNTED ASSOCIATES
The consolidated entity’s share of aggregate assets and liabilities of equity accounted associates is as follows:
Current assets
Non-current assets
Current liabilities
Non-current liabilities
Net assets
Balance at the end of the financial year
CONSOLIDATED
2022
$’M
2021
$’M
8
-
310
210
(16)
(6)
(22)
51
-
8
-
(1)
58
4
-
409
70
(290)
-
189
189
(15)
(1)
(16)
79
(18)
-
(7)
(3)
51
4
-
313
73
(214)
-
172
172
RECOGNITION AND MEASUREMENT
Investments in associates are accounted for in the consolidated financial statements using the equity method of accounting. Under this method, the
consolidated entity’s share of the post-acquisition profits or losses after tax of associates is recognized in the Statement of Financial Performance and Other
Comprehensive Income, and its share of post-acquisition movements in reserves is recognized in consolidated reserves. The cumulative post-acquisition
movements are adjusted against the cost of the investment. Associates are those entities over which the consolidated entity exercises significant influence,
but not control. Joint arrangements are those entities over which joint control is present with at least one other party. Joint ventures are joint arrangements
where the Group is only exposed to the net assets of the investee.
1 Revenue as defined in note 3, Operating Segments.
192
Worley
23. INTERESTS IN JOINT OPERATIONS
The Group’s largest joint operation is listed below. It is not individually material to the Group.
JOINT OPERATION
Kazakh Projects Joint Venture
PRINCIPAL ACTIVITY
Energy
OWNERSHIP INTEREST
CONSOLIDATED
2022
%
50
2021
%
50
The consolidated entity’s interests in the assets and liabilities employed in all joint operations are included in the Statement of Financial Position under the
following classifications:
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Total current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other payables
Total current liabilities
TOTAL LIABILITIES
NET ASSETS
CONSOLIDATED
2022
$’M
2021
$’M
10
46
56
56
47
47
47
9
7
37
44
44
39
39
39
5
RECOGNITION AND MEASUREMENT
The Group recognizes its proportionate interest in the assets, liabilities, revenues and expenses of any joint operations. These balances are incorporated in
the financial statements under the appropriate headings.
24. COMMITMENTS FOR EXPENDITURE
(A) CAPITAL EXPENDITURE COMMITMENTS
Commitments for the minimum amount payable for the acquisition of intangible assets or property, plant and equipment are payable as follows:
Within one year
Later than one year and not later than five years
Later than five years
Commitments not recognized in the financial statements
CONSOLIDATED
2022
$’M
37
31
-
68
(B) OPERATING EXPENDITURE COMMITMENTS AND LEASE COMMITMENTS
Estimated commitments for operating expenditure (primarily in relation to software and information technology) and lease commitments are payable as
follows:
Within one year
Later than one year and not later than five years
Later than five years
Commitments not recognized in the financial statements
45
43
-
88
2021
$’M
24
-
-
24
104
83
-
187
Annual Report 2022
193
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
25. CONTINGENT LIABILITIES
The Company and some of its subsidiaries have commitments and contingencies arising in the ordinary course of business. These includes performance
guarantees and letters of credit in respect of contractual performance obligations, litigations and claims in relation to projects, taxation and environmental
matters. These types of matters could result in various forms of cash outflows, including compensation of damages, cost reimbursements, taxation expense,
fines, penalties, and other forms of cash outflows. The directors consider that it is not probable that the outcome of any individual matter, including the items
listed below, will have a material adverse effect on the net earnings or cash flows in any particular reporting period. In performing this assessment, the
directors considered the nature of existing litigations or claims, the progress of matters, existing law and precedent, the opinions and views of legal counsel
and other advisors, the Group’s experience in similar cases (where applicable), the experience of other companies, and other facts available to the Group at
the time of assessment. The director’s assessment of these factors may change over time as individual litigations or claims progress.
Where it is considered disclosure could prejudice the Groups position in a dispute, as per the accounting standards only the general nature of the dispute has
been disclosed below.
Other than specifically mentioned, none of the financial implications of the matters mentioned below have been provided for in the financial statements.
(A) GUARANTEES
The Company is, in the normal course of business, required to provide guarantees and letters of credit on behalf of controlled entities, associates and related
parties in respect of their contractual performance related obligations.
These guarantees and letters of credit only give rise to a liability where the entity concerned fails to perform its contractual obligation.
Bank guarantees outstanding at balance date in respect of contractual performance
Commitments not recognized in the financial statements
CONSOLIDATED
2022
$’M
1,150
1,150
2021
$’M
931
931
(B) ACTUAL AND PENDING CLAIMS
In the ordinary course of business, the Company and its subsidiaries are subject to various actual and pending legal and project contract claims. In one such
case, the Group is defending a claim for the amount of $40 million in relation to a project, completed prior to 2010 with a contract value of less than $1
million, which we believe to be without legal or factual merit. In FY2022, local courts ruled against Worley on this matter and with the support of legal advice,
the Group is proactively appealing this matter to higher level courts. The earlier unfavourable ruling has been enforced by the court, with cash in a subsidiary
bank account being subject to court ordered restricted access whilst active legal cases are being resolved. While the directors believe there is no legal basis
for this action, these cash balances have been classified as restricted cash in the financial statements (refer to Note 7) until the matter is resolved. Based on
all the facts, the Directors believe that the defence against the action is more likely than not to be successful.
(C) TAXATION COMPLIANCE REVIEWS
The Group is defending its position and is continuing to provide the tax authorities, in various tax jurisdictions, with the requested evidence to support our
positions. We believe that the tax positions have been appropriately taken in line with tax legislation, accounting guidance and external tax advice.
(D) ENVIRONMENTAL
The Group is subject to various environmental regulation requirements in relation to the Group’s global operations. We continue to monitor and abide by
these laws. Existing or pending claims in relation to environmental matters, including asbestos related matters are not expected to have a material effect on
the Group’s operations and performance, however, climate change legislation could have a direct effect on the Group’s customers and suppliers, which could
in turn impact the Group’s operations. We continue to monitor the developments in this area.
The Company has regular reviews of its litigations, claims and other contingent matters, including updates from corporate and outside legal counsel, to
assess the need for accounting recognition or disclosure of these contingencies. The directors are currently of the view that the Group has adequately
considered these matters for recognition in accordance with the Group’s accounting policy.
26. SUBSEQUENT EVENTS
Since the end of the financial year, the directors have resolved to pay a final dividend of 25.0 cents per fully paid ordinary share, including exchangeable
shares, unfranked (2021: 25.0 cents per share).
In accordance with AASB 110 Events after the Reporting Period, the aggregate amount of the proposed final dividend of $131 million is not recognized as a
liability as at 30 June 2022.
Unless disclosed elsewhere in the financial statements, no other material matter or circumstance has arisen since 30 June 2022 that has significantly
affected or may significantly affect:
• the consolidated entity’s operations in future financial years;
• the results of those operations in future financial years; or
• the consolidated entity’s state of affairs in future financial years.
194
Worley
27. PROCUREMENT
In certain situations, the Group enters into contracts with its customers which require the Group to procure goods and services on behalf of the customer.
Where the risks and rewards associated with the procurement activities are assumed by the Group, the revenues and expenses as well as the assets and
liabilities are recognized on a gross basis in the Statement of Financial Performance and Statement of Financial Position respectively, and are set out in the
following table:
REVENUE AND EXPENSES1
Procurement revenue at margin
Procurement costs at margin
Procurement revenue at nil margin
Procurement costs at nil margin
ASSETS AND LIABILITIES
Cash and cash equivalents
Trade and other receivables
Trade and other payables
28. PROPERTY, PLANT AND EQUIPMENT AND RIGHT OF USE (ROU) ASSETS
Land and buildings
At cost
Accumulated depreciation
Property ROU assets
At cost
Accumulated depreciation
Leasehold improvements
At cost
Accumulated amortization
Plant and equipment and ROU assets
At cost
Accumulated depreciation
IT equipment
At cost
Accumulated depreciation
Total property, plant and equipment and ROU assets
CONSOLIDATED
2022
$’M
499
(483)
946
(946)
12
152
199
CONSOLIDATED
2022
$’M
334
(57)
277
534
(335)
199
243
(213)
30
401
(324)
77
208
(174)
34
617
2021
$’M
462
(447)
949
(949)
4
219
228
2021
$’M
314
(47)
267
500
(301)
199
230
(198)
32
377
(295)
82
199
(161)
38
618
1 Revenue and expenses exclude procurement revenue and expenses from associates.
Annual Report 2022
195
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
28. PROPERTY, PLANT AND EQUIPMENT AND RIGHT OF USE (ROU) ASSETS (CONTINUED)
RECONCILIATIONS
Reconciliations of the carrying amounts of each class of property, plant and equipment and ROU assets at the beginning and end of the current and previous
financial years are set out below:
PROPERTY
LEASEHOLD
IMPROVEMENTS
$’M
Balance at 1 July 2021
Additions
Transfer
Disposals and Remeasurements
Impairment Reversals
Depreciation
Amortization
Differences arising on translation of foreign operations
Balance at 30 June 2022
Balance at 1 July 2020
Additions
Transfer
Disposal and Remeasurements
Impairments
Depreciation
Amortization
Differences arising on translation of foreign operations
Balance at 30 June 2021
LAND AND
BUILDINGS
$’M
267
-
-
-
-
(8)
-
18
277
296
-
-
-
-
(7)
-
(22)
267
ROU ASSETS
$’M
199
60
-
-
4
-
(70)
6
199
305
21
-
(1)
(30)
-
(91)
(5)
199
CONSOLIDATED
PLANT AND
EQUIPMENT AND
ROU ASSETS
$’M
IT EQUIPMENT
$’M
32
9
-
-
-
(11)
-
-
30
47
4
(3)
(5)
(3)
(7)
-
(1)
32
82
25
-
(2)
-
(19)
(12)
3
77
109
17
6
-
(12)
(27)
(11)
-
82
38
12
-
-
-
(16)
-
-
34
26
30
(3)
(1)
-
(14)
-
-
38
TOTAL
$’M
618
106
-
(2)
4
(54)
(82)
27
617
783
72
-
(7)
(45)
(55)
(102)
(28)
618
RECOGNITION AND MEASUREMENT
Property, plant and equipment and right of use assets are stated at cost less accumulated depreciation, amortization and impairment, if any.
The Group underwent a property rationalization program in the prior year by reducing the number of offices required and increasing utilization of office space.
As a result, the Group recognized an impairment of certain ROUs and related property, plant and equipment as at 30 June 2021 for $30 million and $8 million
respectively. The property transformation and restructuring program also resulted in provisions for onerous property maintenance contract components
recognized as at 30 June 2021 of $24 million relating to the property maintenance component (non-lease component) of leases considered onerous in line
with AASB 137 Provisions, Contingent Liabilities and Contingent Assets. In the current year, there has been a net $4 million reversal of impairment
recognized, and no additional provision for onerous property contracts recognized as a result of a change in assumptions used in previously impaired
properties. These costs are included in the transformation and restructuring costs in note 5.
The aforementioned assets were impaired on an individual basis where they could be distinguished as a stand-alone asset (generate largely independent
cash flows). Where assets could not be individually distinguished they are grouped and tested within the appropriate CGU as described further in note 10.
The ROU impairments represent the difference between the pre-impairment carrying value at assessment date less the recoverable amount. The
recoverable amounts include an assessment of potential sub-lease income which requires an element of judgment and are based on Management's best
estimate.
196
Worley
29. DEFERRED TAX
(A) DEFERRED TAX ASSETS
The balance comprises temporary differences attributable to:
Amounts recognized in the Statement of Financial Performance:
ECL allowance on trade receivables
Employee benefits provisions
Warranty provisions
Project provisions
Other provisions
Property, plant and equipment and right of use assets
Sundry accruals
Recognized tax losses
Unused foreign tax credits
Unrealized foreign exchange losses
Other
Total deferred tax assets
Deferred tax asset and liabilities right to offset1
Net deferred tax assets
Amounts recognized directly in equity:
Foreign exchange losses
Deferred tax assets
Balance at the beginning of the financial year
Credited to the Statement of Financial Performance
Charged to equity
Deferred tax offset movement
Differences arising on translation of foreign operations
Balance at the end of the financial year
(B) DEFERRED TAX LIABILITIES
The balance comprises temporary differences attributable to:
Amounts recognized in the Statement of Financial Performance:
Identifiable intangible assets and goodwill
Unbilled contract revenue
Property, plant and equipment and right of use assets
Unrealized foreign exchange gains
Prepayments
Other
Total deferred tax liabilities
Deferred tax asset and liabilities right to offset1
Net deferred tax liabilities
Amounts recognized directly in equity:
Cash flow hedges
Deferred tax liabilities
Balance at the beginning of the financial year
Charged to the Statement of Financial Performance
Charged to equity
Deferred tax offset movement
Differences arising on translation of foreign operations
Balance at the end of the financial year
CONSOLIDATED
2022
$’M
2021
$’M
5
80
14
32
101
61
12
113
3
14
(20)
415
(209)
206
(14)
192
213
(25)
(7)
(15)
26
192
233
53
23
13
1
(23)
300
(209)
91
(1)
90
60
42
(1)
(15)
4
90
9
74
11
42
100
63
14
113
3
7
(22)
414
(194)
220
(7)
213
249
43
(20)
(61)
2
213
194
46
25
5
-
(16)
254
(194)
60
-
60
111
15
(1)
(61)
(4)
60
1 In accordance with AASB 112 Income Taxes
Annual Report 2022
197
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
29. DEFERRED TAX (CONTINUED)
RECOGNITION AND MEASUREMENT
Deferred tax assets and liabilities are recognized for temporary differences at the tax rates expected to apply when the assets are recovered or liabilities are
settled, based on those tax rates which are enacted or substantially enacted for each jurisdiction. The relevant tax rates are applied to the cumulative
amounts of deductible and taxable temporary differences to measure the deferred tax asset or liability. An exception is made for certain temporary
differences arising from the initial recognition of an asset or a liability. No deferred tax asset or liability is recognized in relation to these temporary
differences if they arose in a transaction, other than a business combination that at the time did not affect either accounting profit or taxable profit and loss
within the Statement of Financial Performance.
Deferred tax assets and liabilities are not recognized for temporary differences between the carrying amount and tax bases of investments in controlled
entities where the parent entity is able to control the timing of the reversal of the temporary differences and it is probable that the differences will not
reverse in the foreseeable future.
Current and deferred tax amounts relating to items recognized directly in equity are also recognized in equity and not in the Statement of Financial
Performance.
KEY ESTIMATES
Deferred tax assets are recognized for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be
available to utilize those temporary differences. The Group assesses the recoverability of recognized and unrecognized deferred taxes on a consistent basis,
using estimates and assumptions relating to projected earnings and cash flows as applied in the Group impairment process.
30. DEFINED BENEFIT PLANS
The Group operates defined benefit pension plans which require contributions to be made to a separately administered fund. The Group also provides certain
post-employment healthcare benefits to employees (unfunded). Except for plans in Saudi Arabia, all plans are closed to new participants.
The balances in relation to defined benefit plans are as follows:
Amounts recognized in the Statement of Financial Position:
Net defined benefits liability
Reclassification from employee entitlement provisions
Net defined benefits liability
CONSOLIDATED
2022
$’M
41
10
51
2021
$’M
51
-
51
RECOGNITION AND MEASUREMENT
Defined benefit obligation calculation is performed by qualified actuaries using the projected credit method.
The Group's net obligation in respect of defined benefits plans is calculated separately for each plan by estimating the amount of future benefit that
employees have earned, discounted with the fair value of the plan assets deducted.
Remeasurements of the net defined benefit liability which comprise actual gains and losses, the return on plan assets and any asset ceilings where
applicable are recognized in OCI. Remeasurements are not reclassified to profit or loss in subsequent periods.
Net interest expense and other expenses relating to defined benefit plans are recognized in profit and loss.
When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on
curtailment is recognized in profit and loss. Gains and losses on settlement of a defined benefit plan are recognized when settlement occurs.
31. RELATED PARTIES
(A) DIRECTORS
The names of persons who were directors of the Company at any time during the financial year were as follows:
John Grill, AO (Chair)
Andrew Liveris, AO (Deputy Chair and Lead Independent Director)
Christopher Haynes, OBE
Thomas Gorman
Roger Higgins
Martin Parkinson, AC
Emma Stein
Juan Suárez Coppel
Anne Templeman-Jones
Wang Xiao Bin
Sharon Warburton
Chris Ashton (Chief Executive Officer and Managing Director)
198
Worley
31. RELATED PARTIES (CONTINUED)
(B) OTHER RELATED PARTIES
Aggregate amounts brought to account in relation to other transactions with each class of other related parties were as follows:
Net loan repayments to/(from):
Associates and related parties
Dividends received from:
Dividend revenue from associates
Aggregate amounts, receivable from, and payable to, each class of other related parties at balance date were as follows:
Current receivables
Associates and related parties
Current payables
Associates and related parties
CONSOLIDATED
2022
$’000
2021
$’000
6,000
(6,000)
1,000
3,000
37,000
26,000
4,000
-
Related entities provide specific advisory services to controlled entities in the normal course of business. These transactions are made on normal terms and
conditions and at market rates.
(C) CONTROLLING ENTITIES
Worley Limited is the ultimate Australian parent company.
32. REMUNERATION OF AUDITORS
Remuneration for audit or review of the financial reports of the Parent Entity or any other entity in the Group:
Fees for auditing the statutory financial reports of the Parent and any controlled entities covering the Group
Fees for non-audit services:
- Tax related services
- Assurance services
- Other non-audit services
Total fees to Ernst & Young (Australia)
(A) REMUNERATION OF OVERSEAS MEMBER FIRMS OF ERNST & YOUNG
Fees for auditing the statutory financial reports of the Parent and any controlled entities covering the Group
Fees for auditing the statutory financial reports of any controlled entities excluded from the Group audit
Fees for non-audit services:
- Tax related services
- Other non-audit services
Total fees to overseas member firms of Ernst & Young
Total remuneration of Ernst & Young
Other auditors of controlled entities
Total Audit remuneration
33. KEY MANAGEMENT PERSONNEL
Short term employee benefits
Post-employment benefits
Termination benefits
Other long term benefits
Share based payments
Total compensation
CONSOLIDATED
2022
$
2021
$
2,433,965
2,621,893
3,282
70,000
-
1,309
-
486,000
2,507,247
3,109,202
2,762,358
2,214,571
2,822,427
2,441,825
998,331
1,372
1,044,625
-
5,976,632
6,308,877
8,483,879
9,418,079
129,912
62,398
8,613,791
9,480,477
CONSOLIDATED
2022
$
2021
$
10,086,000
166,000
151,000
10,000
2,047,000
9,841,000
204,000
-
18,000
2,582,000
12,460,000
12,645,000
Annual Report 2022
199
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
34. PARENT ENTITY DISCLOSURES
(A) PARENT ENTITY
Worley Limited Parent Entity financial statements include investments in the following entities:
ENTITY
COUNTRY OF INCORPORATION
Worley SPV1 Pty Limited
Worley Financial Services Pty Limited
Worley Canada Holdings Pty Limited
Worley Canada Callco Ltd
Worley Engineering Pty Limited
Engineering Securities Pty Limited atf The Worley Limited Trust
Australia
Australia
Australia
Canada
Australia
Australia
The Parent Entity’s summary financial information as required by the Corporations Act 2001 is as follows:
STATEMENT OF FINANCIAL PERFORMANCE
Profit before income tax expense
Income tax expense
Profit/(loss) after income tax
Profit attributable to members of Worley Limited
Retained profits at the beginning of the financial year
Net dividends paid
Retained profits at the end of the financial year
STATEMENT OF COMPREHENSIVE INCOME
Profit after income tax expense
Total comprehensive income, net of tax
STATEMENT OF FINANCIAL POSITION
Current assets
Total assets
Current liabilities
Total liabilities
Net assets
Issued capital
Performance rights reserve
Other reserves
Retained profits
Total equity
2022
$’M
2,977
440
198
121
100
94
3,930
2022
$’M
305
6
311
311
61
(262)
110
311
311
2,043
5,962
440
447
5,515
5,341
60
4
110
5,515
2021
$’M
2,977
440
198
121
100
94
3,930
2021
$’M
213
(5)
208
208
114
(261)
61
208
208
1,701
5,620
171
171
5,449
5,321
67
-
61
5,449
The Parent Entity has bank guarantees in respect of contractual performance outstanding at 30 June 2022 for the amount of nil (2021: $nil). These
commitments have not been recognized in the financial statements.
The Parent Entity has no commitments for expenditure.
200
Worley
34. PARENT ENTITY DISCLOSURES (CONTINUED)
(B) CLOSED GROUP
Worley Limited together with Worley No 2 Pty Limited, Worley Engineering Pty Limited, Worley Financial Services Pty Limited, Worley Services Pty Limited,
Engineering Securities Pty Limited, Advisian Group Pty Limited, Advisian Pty Ltd, Worley SPV1 Pty Limited, Worley EA Holdings Pty Limited, Worley
Infrastructure Holdings Pty Limited, Worley SEA Pty Limited, Worley South America Holdings Pty Limited, Worley Africa Holdings Pty Limited, Energy
Resourcing Australia Pty Limited, INTECSEA Pty Ltd, Worley ECR Pty Ltd, Worley Group Pty Ltd, and TW Power Services Pty Limited entered into a Deed of
Cross Guarantee. The effect of the deed is that Worley Limited has guaranteed to pay any deficiency in the event of the winding up of the abovementioned
controlled entities. The controlled entities have also given a similar guarantee in the event that Worley Limited is wound up. As a result, ASIC Corporations
Instrument 2016/785 relieves certain of the controlled entities from the Corporations Act 2001 requirements for preparation, audit and lodgement of financial
reports.
The Statement of Financial Performance and Statement of Financial Position of the entities which are parties to the Deed of Cross Guarantee and The Worley
Limited Trust (Closed Group) are as follows:
CLOSED GROUP
STATEMENT OF FINANCIAL PERFORMANCE
Profit before income tax expense
Income tax expense
Profit after income tax expense
Profit attributable to members of Worley Limited
Retained profits at the beginning of the financial year
Retained profits of entities that became party to the deed during the financial year
Dividends paid
Retained profits at the end of the financial year
STATEMENT OF FINANCIAL POSITION
ASSETS
Current assets
Cash and cash equivalents
Trade and other receivables
Other current assets
Total current assets
Non-current assets
Deferred tax assets
Intangible assets
Property, plant and equipment
Other non-current assets
Total non-current assets
TOTAL ASSETS
LIABILITIES
Current liabilities
Trade and other payables
Interest bearing loans and borrowings and lease liabilities
Provisions
Derivatives
Total current liabilities
Non-current liabilities
Trade and other payables
Interest bearing loans and borrowings and lease liabilities
Deferred tax liabilities
Total non-current liabilities
TOTAL LIABILITIES
NET ASSETS
EQUITY
Issued capital
Reserves
Retained profits
TOTAL EQUITY
2022
$’M
82
(17)
65
65
550
2
(262)
355
40
2,888
69
2,997
46
216
47
5,658
5,967
8,964
2,685
11
85
11
2,792
9
413
17
439
3,231
5,733
5,341
37
355
5,733
2021
$’M
123
(12)
111
111
709
(9)
(261)
550
6
2,149
73
2,228
47
249
54
5,600
5,950
8,178
1,884
50
109
6
2,049
10
200
14
224
2,273
5,905
5,321
34
550
5,905
Annual Report 2022
201
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
Directors’ declaration
In accordance with a resolution of the directors of Worley Limited, I state that:
1.
In the opinion of the directors:
(a) the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2022 and of its performance for the year ended on that
date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001;
(b) the financial statements and notes also comply with International Financial Reporting Standards as disclosed in note 2(A);
(c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; and
(d) as at the date of this declaration, there are reasonable grounds to believe that the members of the Closed Group identified in note 34(B) will be able
to meet any obligations or liabilities to which they are or may become subject, by virtue of the Deed of Cross Guarantee.
2. This declaration has been made after receiving the declarations required to be made to the directors from the chief executive officer and chief financial
financial report.
officer in accordance with section 295A of the Corporations Act 2001 for the financial year ended 30 June 2022.
On behalf of the Board
JOHN GRILL, AO
Chair
Sydney, 24 August 2022
Ernst & Young
200 George Street
Sydney NSW 2000 Australia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
misstatement of the financial report. The results of our audit procedures, including the procedures
Independent auditor's report to the members of Worley Limited
performed to address the matters below, provide the basis for our audit opinion on the accompanying
1. Revenue Recognition and Measurement
Report on the audit of the financial report
Opinion
Why significant
How our audit addressed the key audit matter
We have audited the financial report of Worley Limited (the Company) and its subsidiaries (collectively the
The Group recognises revenue from
Group), which comprises the consolidated statement of financial position as at 30 June 2022, the
Our audit procedures included the following:
contracts with customers as performance
consolidated statement of financial performance and other comprehensive income, consolidated
obligations are fulfilled over time. This
statement of changes in equity and consolidated statement of cash flows for the year then ended, notes
to the financial statements, including a summary of significant accounting policies, and the directors'
occurs when services are performed or
We assessed whether the policies and methodology used by
the Group to recognise revenue met the requirements of
declaration.
goods are transferred to the customer at
an amount that reflects the consideration
Australian Accounting Standards.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
to which the Group expects to be entitled
2001, including:
in exchange for those goods or services.
We assessed the effectiveness of the Group’s controls in
a)
When the revenue is recognised, estimates
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2022
can be required due to the nature and
o initiation, processing and approval of new customers
extent of varying contract conditions,
and of its consolidated financial performance for the year ended on that date; and
and/or contracts;
which are unique and can be complex.
o review and approval of project costs incurred;
b)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
o authorisation of monthly project variations;
the following areas:
The accurate recording of revenue is
highly dependent upon the following
factors:
Basis for opinion
o review and assessment of significant changes in work
in progress balances; and
o review of unapproved variations and claims.
Appropriate knowledge of individual
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
Performed data analytical procedures to corroborate the
contract characteristics and status of
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
expected correlation between revenue and related
Report section of our report. We are independent of the Group in accordance with the auditor
work - key characteristics would be the
accounts during the year.
independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting
project and length and type of contract
Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants
(lump sum basis or time and materials
(including Independence Standards) (the Code) that are relevant to our audit of the financial report in
We selected a sample of contracts based on qualitative and
industry and/or geography of the
Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
quantitative factors and performed the following
basis);
Determination of variable
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
procedures:
opinion.
consideration, including performance
incentives, which are recognised from
the outset of the contract but only to
Key audit matters
the extent that it is highly probable
that a significant revenue reversal will
o reviewed contract terms and conditions and assessed
whether the individual characteristics of each contract
were appropriately accounted for;
o assessed the Group’s ability to deliver budgeted
contract margins by analysing the historical accuracy
Key audit matters are those matters that, in our professional judgement, were of most significance in our
of forecasting margins and the relationship of contract
not occur; and
audit of the financial report of the current year. These matters were addressed in the context of our audit
cost versus billing status;
of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate
o agreed material contract revenue and cost variations
opinion on these matters. For each matter below, our description of how our audit addressed the matter
and claims to information provided by third parties;
is provided in that context.
o assessed any variable consideration and the basis for
recognition and measurement;
202
202
Worley
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Worley
NOTES TO THE FINANCIAL STATEMENTS CONTINUED
Directors’ declaration
In accordance with a resolution of the directors of Worley Limited, I state that:
1.
In the opinion of the directors:
(a) the financial statements and notes of the consolidated entity are in accordance with the Corporations Act 2001, including:
(i) giving a true and fair view of the consolidated entity’s financial position as at 30 June 2022 and of its performance for the year ended on that
date; and
(ii) complying with Australian Accounting Standards and the Corporations Regulations 2001;
(b) the financial statements and notes also comply with International Financial Reporting Standards as disclosed in note 2(A);
(c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable; and
(d) as at the date of this declaration, there are reasonable grounds to believe that the members of the Closed Group identified in note 34(B) will be able
to meet any obligations or liabilities to which they are or may become subject, by virtue of the Deed of Cross Guarantee.
2. This declaration has been made after receiving the declarations required to be made to the directors from the chief executive officer and chief financial
officer in accordance with section 295A of the Corporations Act 2001 for the financial year ended 30 June 2022.
On behalf of the Board
JOHN GRILL, AO
Chair
Sydney, 24 August 2022
Ernst & Young
200 George Street
Sydney NSW 2000 Australia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
misstatement of the financial report. The results of our audit procedures, including the procedures
Independent auditor's report to the members of Worley Limited
performed to address the matters below, provide the basis for our audit opinion on the accompanying
financial report.
1. Revenue Recognition and Measurement
Report on the audit of the financial report
Opinion
Why significant
How our audit addressed the key audit matter
Our audit procedures included the following:
We have audited the financial report of Worley Limited (the Company) and its subsidiaries (collectively the
The Group recognises revenue from
Group), which comprises the consolidated statement of financial position as at 30 June 2022, the
contracts with customers as performance
consolidated statement of financial performance and other comprehensive income, consolidated
obligations are fulfilled over time. This
statement of changes in equity and consolidated statement of cash flows for the year then ended, notes
occurs when services are performed or
to the financial statements, including a summary of significant accounting policies, and the directors'
declaration.
goods are transferred to the customer at
an amount that reflects the consideration
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
to which the Group expects to be entitled
2001, including:
in exchange for those goods or services.
We assessed whether the policies and methodology used by
the Group to recognise revenue met the requirements of
Australian Accounting Standards.
We assessed the effectiveness of the Group’s controls in
and/or contracts;
and of its consolidated financial performance for the year ended on that date; and
complying with Australian Accounting Standards and the Corporations Regulations 2001.
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2022
the following areas:
o initiation, processing and approval of new customers
o review and approval of project costs incurred;
o authorisation of monthly project variations;
o review and assessment of significant changes in work
a)
When the revenue is recognised, estimates
can be required due to the nature and
extent of varying contract conditions,
which are unique and can be complex.
b)
The accurate recording of revenue is
highly dependent upon the following
factors:
Basis for opinion
Appropriate knowledge of individual
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
Performed data analytical procedures to corroborate the
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
expected correlation between revenue and related
Report section of our report. We are independent of the Group in accordance with the auditor
accounts during the year.
independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting
Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants
(including Independence Standards) (the Code) that are relevant to our audit of the financial report in
Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
contract characteristics and status of
work - key characteristics would be the
industry and/or geography of the
project and length and type of contract
(lump sum basis or time and materials
basis);
o review of unapproved variations and claims.
We selected a sample of contracts based on qualitative and
in progress balances; and
Determination of variable
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
quantitative factors and performed the following
procedures:
o reviewed contract terms and conditions and assessed
whether the individual characteristics of each contract
were appropriately accounted for;
o assessed the Group’s ability to deliver budgeted
consideration, including performance
incentives, which are recognised from
the outset of the contract but only to
the extent that it is highly probable
that a significant revenue reversal will
not occur; and
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate
o agreed material contract revenue and cost variations
opinion on these matters. For each matter below, our description of how our audit addressed the matter
and claims to information provided by third parties;
is provided in that context.
o assessed any variable consideration and the basis for
contract margins by analysing the historical accuracy
of forecasting margins and the relationship of contract
cost versus billing status;
recognition and measurement;
202
Worley
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
203
Annual Report 2022
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
misstatement of the financial report. The results of our audit procedures, including the procedures
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
performed to address the matters below, provide the basis for our audit opinion on the accompanying
included the performance of procedures designed to respond to our assessment of the risks of material
financial report.
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
1. Revenue Recognition and Measurement
financial report.
1. Revenue Recognition and Measurement
Why significant
How our audit addressed the key audit matter
Why significant
The Group recognises revenue from
contracts with customers as performance
obligations are fulfilled over time. This
The Group recognises revenue from
occurs when services are performed or
contracts with customers as performance
goods are transferred to the customer at
obligations are fulfilled over time. This
an amount that reflects the consideration
occurs when services are performed or
to which the Group expects to be entitled
goods are transferred to the customer at
in exchange for those goods or services.
an amount that reflects the consideration
to which the Group expects to be entitled
When the revenue is recognised, estimates
in exchange for those goods or services.
can be required due to the nature and
extent of varying contract conditions,
When the revenue is recognised, estimates
which are unique and can be complex.
can be required due to the nature and
extent of varying contract conditions,
The accurate recording of revenue is
which are unique and can be complex.
highly dependent upon the following
factors:
The accurate recording of revenue is
highly dependent upon the following
Appropriate knowledge of individual
factors:
Determination of variable
contract characteristics and status of
work - key characteristics would be the
Appropriate knowledge of individual
industry and/or geography of the
contract characteristics and status of
project and length and type of contract
work - key characteristics would be the
(lump sum basis or time and materials
industry and/or geography of the
basis);
project and length and type of contract
(lump sum basis or time and materials
basis);
consideration, including performance
incentives, which are recognised from
the outset of the contract but only to
consideration, including performance
the extent that it is highly probable
incentives, which are recognised from
that a significant revenue reversal will
the outset of the contract but only to
not occur; and
the extent that it is highly probable
that a significant revenue reversal will
not occur; and
Determination of variable
How our audit addressed the key audit matter
Our audit procedures included the following:
Our audit procedures included the following:
We assessed whether the policies and methodology used by
the Group to recognise revenue met the requirements of
Australian Accounting Standards.
We assessed whether the policies and methodology used by
the Group to recognise revenue met the requirements of
Australian Accounting Standards.
We assessed the effectiveness of the Group’s controls in
and/or contracts;
the following areas:
We assessed the effectiveness of the Group’s controls in
o initiation, processing and approval of new customers
the following areas:
o review and approval of project costs incurred;
o initiation, processing and approval of new customers
o authorisation of monthly project variations;
o review and assessment of significant changes in work
o review and approval of project costs incurred;
o authorisation of monthly project variations;
o review of unapproved variations and claims.
o review and assessment of significant changes in work
in progress balances; and
and/or contracts;
in progress balances; and
o review of unapproved variations and claims.
Performed data analytical procedures to corroborate the
expected correlation between revenue and related
accounts during the year.
Performed data analytical procedures to corroborate the
expected correlation between revenue and related
accounts during the year.
We selected a sample of contracts based on qualitative and
quantitative factors and performed the following
procedures:
We selected a sample of contracts based on qualitative and
quantitative factors and performed the following
o reviewed contract terms and conditions and assessed
procedures:
whether the individual characteristics of each contract
were appropriately accounted for;
o reviewed contract terms and conditions and assessed
o assessed the Group’s ability to deliver budgeted
whether the individual characteristics of each contract
contract margins by analysing the historical accuracy
were appropriately accounted for;
of forecasting margins and the relationship of contract
cost versus billing status;
contract margins by analysing the historical accuracy
o agreed material contract revenue and cost variations
of forecasting margins and the relationship of contract
and claims to information provided by third parties;
cost versus billing status;
o assessed any variable consideration and the basis for
o agreed material contract revenue and cost variations
recognition and measurement;
and claims to information provided by third parties;
o assessed any variable consideration and the basis for
o assessed the Group’s ability to deliver budgeted
recognition and measurement;
Ernst & Young
200 George Street
Sydney NSW 2000 Australia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
o assessed related contract provisions and the
Determination of claims received from
misstatement of the financial report. The results of our audit procedures, including the procedures
probability of a reversal of revenue with reference to
customers, including an assessment of
Independent auditor's report to the members of Worley Limited
performed to address the matters below, provide the basis for our audit opinion on the accompanying
contract terms and customer claims; and
the probability that such claims will
financial report.
result in an outflow of economic
resources.
o for contracts accounted for using the percentage of
completion method, we assessed the forecast cost to
1. Revenue Recognition and Measurement
Report on the audit of the financial report
This was considered a key audit matter
complete calculations.
given the complexity of the contracts and
Opinion
Why significant
the level of judgement required to
estimate the amount of revenue
We evaluated the adequacy of the related disclosures in the
How our audit addressed the key audit matter
financial report including those made with respect to
judgements and estimates.
We have audited the financial report of Worley Limited (the Company) and its subsidiaries (collectively the
Group), which comprises the consolidated statement of financial position as at 30 June 2022, the
Our audit procedures included the following:
The Group recognises revenue from
recognised.
contracts with customers as performance
consolidated statement of financial performance and other comprehensive income, consolidated
The Group’s disclosures are included in
statement of changes in equity and consolidated statement of cash flows for the year then ended, notes
obligations are fulfilled over time. This
to the financial statements, including a summary of significant accounting policies, and the directors'
occurs when services are performed or
We assessed whether the policies and methodology used by
Note 4 of the financial report.
the Group to recognise revenue met the requirements of
declaration.
goods are transferred to the customer at
an amount that reflects the consideration
Australian Accounting Standards.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
to which the Group expects to be entitled
2001, including:
in exchange for those goods or services.
We assessed the effectiveness of the Group’s controls in
a)
When the revenue is recognised, estimates
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2022
can be required due to the nature and
o initiation, processing and approval of new customers
extent of varying contract conditions,
and of its consolidated financial performance for the year ended on that date; and
and/or contracts;
which are unique and can be complex.
o review and approval of project costs incurred;
b)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
o authorisation of monthly project variations;
the following areas:
The accurate recording of revenue is
highly dependent upon the following
factors:
Basis for opinion
o review and assessment of significant changes in work
in progress balances; and
o review of unapproved variations and claims.
Appropriate knowledge of individual
contract characteristics and status of
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
Performed data analytical procedures to corroborate the
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
expected correlation between revenue and related
Report section of our report. We are independent of the Group in accordance with the auditor
work - key characteristics would be the
accounts during the year.
independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting
project and length and type of contract
Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants
(including Independence Standards) (the Code) that are relevant to our audit of the financial report in
We selected a sample of contracts based on qualitative and
(lump sum basis or time and materials
industry and/or geography of the
Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
quantitative factors and performed the following
basis);
Determination of variable
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
procedures:
opinion.
consideration, including performance
incentives, which are recognised from
the outset of the contract but only to
Key audit matters
the extent that it is highly probable
that a significant revenue reversal will
o reviewed contract terms and conditions and assessed
whether the individual characteristics of each contract
were appropriately accounted for;
o assessed the Group’s ability to deliver budgeted
contract margins by analysing the historical accuracy
Key audit matters are those matters that, in our professional judgement, were of most significance in our
of forecasting margins and the relationship of contract
not occur; and
audit of the financial report of the current year. These matters were addressed in the context of our audit
cost versus billing status;
of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate
o agreed material contract revenue and cost variations
opinion on these matters. For each matter below, our description of how our audit addressed the matter
and claims to information provided by third parties;
is provided in that context.
o assessed any variable consideration and the basis for
recognition and measurement;
A member firm of Ernst & Young Global Limited
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204
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
A member firm of Ernst & Young Global Limited
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Liability limited by a scheme approved under Professional Standards Legislation
Worley
Ernst & Young
200 George Street
Sydney NSW 2000 Australia
GPO Box 2646 Sydney NSW 2001
Tel: +61 2 9248 5555
Fax: +61 2 9248 5959
ey.com/au
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
o asses sed related contract provisions and the
Determination of claims received from
misstatement of the financial report. The results of our audit procedures, including the procedures
customers, including an assessment of
Independent auditor's report to the members of Worley Limited
performed to address the matters below, provide the basis for our audit opinion on the accompanying
the probability that such claims will
financial report.
result in an outflow of economic
resources.
probability of a reversal of revenue with reference to
contract terms and customer claims; and
o for cont racts accounted for using the percentage of
completion method, we assessed the forecast cost to
complete calculations.
financial report including those made with respect to
judgements and estimates.
We evaluated the adequacy of the related disclosures in the
How our audit addressed the key audit matter
1. Revenue Recognition and Measurement
Report on the audit of the financial report
This was considered a key audit matter
given the complexity of the contracts and
Opinion
Why significant
the level of judgement required to
estimate the amount of revenue
We have audited the financial report of Worley Limited (the Company) and its subsidiaries (collectively the
recognised.
The Group recognises revenue from
Group), which comprises the consolidated statement of financial position as at 30 June 2022, the
contracts with customers as performance
consolidated statement of financial performance and other comprehensive income, consolidated
The Group’s disclosures are included in
obligations are fulfilled over time. This
statement of changes in equity and consolidated statement of cash flows for the year then ended, notes
Note 4 of the financial report.
occurs when services are performed or
to the financial statements, including a summary of significant accounting policies, and the directors'
declaration.
goods are transferred to the customer at
an amount that reflects the consideration
to which the Group expects to be entitled
in exchange for those goods or services.
In our opinion, the accompanying financial report of the Group is in accordance with the Corporations Act
2001, including:
We assessed whether the policies and methodology used by
the Group to recognise revenue met the requirements of
Australian Accounting Standards.
We assessed the effectiveness of the Group’s controls in
Our audit procedures included the following:
a)
giving a true and fair view of the consolidated financial position of the Group as at 30 June 2022
the following areas:
o initiation, processing and approval of new customers
and of its consolidated financial performance for the year ended on that date; and
and/or contracts;
When the revenue is recognised, estimates
can be required due to the nature and
extent of varying contract conditions,
which are unique and can be complex.
b)
complying with Australian Accounting Standards and the Corporations Regulations 2001.
o review and approval of project costs incurred;
o authorisation of monthly project variations;
o review and assessment of significant changes in work
in progress balances; and
o review of unapproved variations and claims.
The accurate recording of revenue is
highly dependent upon the following
factors:
Basis for opinion
Appropriate knowledge of individual
Performed data analytical procedures to corroborate the
expected correlation between revenue and related
accounts during the year.
contract characteristics and status of
work - key characteristics would be the
industry and/or geography of the
project and length and type of contract
(lump sum basis or time and materials
basis);
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under
those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial
Report section of our report. We are independent of the Group in accordance with the auditor
independence requirements of the Corporations Act 2001 and the ethical requirements of the Accounting
Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants
(including Independence Standards) (the Code) that are relevant to our audit of the financial report in
Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
quantitative factors and performed the following
procedures:
o reviewed contract terms and conditions and assessed
whether the individual characteristics of each contract
were appropriately accounted for;
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
We selected a sample of contracts based on qualitative and
Determination of variable
o assessed the Group’s ability to deliver budgeted
Key audit matters are those matters that, in our professional judgement, were of most significance in our
audit of the financial report of the current year. These matters were addressed in the context of our audit
of the financial report as a whole, and in forming our opinion thereon, but we do not provide a separate
opinion on these matters. For each matter below, our description of how our audit addressed the matter
is provided in that context.
o agreed material contract revenue and cost variations
and claims to information provided by third parties;
o assessed any variable consideration and the basis for
contract margins by analysing the historical accuracy
of forecasting margins and the relationship of contract
cost versus billing status;
consideration, including performance
incentives, which are recognised from
the outset of the contract but only to
the extent that it is highly probable
that a significant revenue reversal will
not occur; and
Key audit matters
recognition and measurement;
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
A member firm of Ernst & Young Global Limited
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Liability limited by a scheme approved under Professional Standards Legislation
205
Annual Report 2022
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
2. Impairment of trade receivables
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
Why significant
How our audit addressed the key audit matter
financial report.
Our audit procedures included the following:
1. Revenue Recognition and Measurement
An allowance for impairment is made by the
Group for the expected credit losses associated
with its trade receivables and unbilled contract
Why significant
revenue. The Group has $338 million of trade
receivables and unbilled contract revenue as at
30 June 2022 that are more than 121 days past
The Group recognises revenue from
due with an associated impairment allowance of
contracts with customers as performance
$70 million, as disclosed in Note 19(B).
obligations are fulfilled over time. This
occurs when services are performed or
The Group applies a lifetime expected loss model
goods are transferred to the customer at
to measure expected credit losses. The Group
an amount that reflects the consideration
uses judgement in making the assumptions and
to which the Group expects to be entitled
selecting the inputs to the impairment
in exchange for those goods or services.
calculation, based on the Group’s past history,
existing market conditions as well as forward
When the revenue is recognised, estimates
looking assumptions.
can be required due to the nature and
extent of varying contract conditions,
For certain trade receivables more than 121
which are unique and can be complex.
days past due, the impairment allowance also
considers the process to achieve recovery which
The accurate recording of revenue is
may include litigation.
highly dependent upon the following
factors:
This was a key audit matter due to the
judgement involved in making the assumptions
Appropriate knowledge of individual
and estimating the inputs to the impairment
contract characteristics and status of
calculation.
work - key characteristics would be the
industry and/or geography of the
The Group’s disclosures are included in Notes 8
project and length and type of contract
and 19(B) of the financial report.
(lump sum basis or time and materials
basis);
Determination of variable
consideration, including performance
incentives, which are recognised from
the outset of the contract but only to
the extent that it is highly probable
that a significant revenue reversal will
not occur; and
How our audit addressed the key audit matter
We assessed whether the process for recognising
Our audit procedures included the following:
impairment of trade receivables met the
requirements of Australian Accounting
Standards.
and/or contracts;
We assessed the effectiveness of the Group’s controls in
We assessed whether the policies and methodology used by
We assessed the Group’s estimates of the
the Group to recognise revenue met the requirements of
expected credit losses, with reference to
Australian Accounting Standards.
historical losses and the ageing of trade
receivables and unbilled contract revenue.
We selected a sample of trade receivables and
unbilled contract revenue based on qualitative
the following areas:
and quantitative factors and performed the
o initiation, processing and approval of new customers
following procedures:
o We analysed the ageing of trade receivables,
o review and approval of project costs incurred;
past payment and credit history of the
o authorisation of monthly project variations;
customers;
o review and assessment of significant changes in work
o We a ssessed the economic environment
applicable to these customers;
o review of unapproved variations and claims.
o We considered the historical accuracy of
forecasting expected credit losses;
Performed data analytical procedures to corroborate the
expected correlation between revenue and related
legal and external experts; and
accounts during the year.
o Where applicable we evaluated evidence from
in progress balances; and
We selected a sample of contracts based on qualitative and
o We evaluated the Group’s assessment of
collectability considering the process to
achieve recovery, the likely timing of these
processes and events that could delay or
impact the collectability.
quantitative factors and performed the following
procedures:
o reviewed contract terms and conditions and assessed
whether the individual characteristics of each contract
disclosures in the financial report including
were appropriately accounted for;
those made with respect to judgements and
o assessed the Group’s ability to deliver budgeted
estimates.
We evaluated the adequacy of the related
contract margins by analysing the historical accuracy
of forecasting margins and the relationship of contract
cost versus billing status;
o agreed material contract revenue and cost variations
and claims to information provided by third parties;
o assessed any variable consideration and the basis for
recognition and measurement;
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
206
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
3. Impairment of Goodwill
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
Why significant
financial report.
How our audit addressed the key audit matter
1. Revenue Recognition and Measurement
In accordance with the requirements of
Australian Accounting Standards, the
Why significant
Group performed an annual impairment
test of goodwill after allocating
goodwill to groups of cash-generating
The Group recognises revenue from
units (CGUs).
contracts with customers as performance
obligations are fulfilled over time. This
A value in use model based on
occurs when services are performed or
discounted cash flow forecasts is used
goods are transferred to the customer at
to calculate the recoverable amount of
an amount that reflects the consideration
each group of CGUs. The cash flow
to which the Group expects to be entitled
forecasts and growth rates include
in exchange for those goods or services.
consideration of forecast economic
conditions and the focus on
When the revenue is recognised, estimates
sustainability on the business.
can be required due to the nature and
extent of varying contract conditions,
This was considered to be a Key Audit
which are unique and can be complex.
Matter due to the level of judgement
required to forecast cash flows and
The accurate recording of revenue is
discount rates used to calculate the
highly dependent upon the following
recoverable amount of each Group of
factors:
CGUs.
Appropriate knowledge of individual
The Group’s disclosures are included in
contract characteristics and status of
Note 10 of the financial report.
work - key characteristics would be the
industry and/or geography of the
project and length and type of contract
(lump sum basis or time and materials
basis);
Determination of variable
consideration, including performance
incentives, which are recognised from
the outset of the contract but only to
the extent that it is highly probable
that a significant revenue reversal will
not occur; and
Our audit procedures included the following:
We assessed whether the methodology used by the Group
How our audit addressed the key audit matter
met the requirements of Australian Accounting Standards,
including the allocation of goodwill to groups of CGUs.
Our audit procedures included the following:
We involved our valuation specialists in performing the
following procedures relating to the value in use models of
We assessed whether the policies and methodology used by
the Group to recognise revenue met the requirements of
the Group’s CGUs:
o We assessed the basis of preparing cash flow
Australian Accounting Standards.
forecasts considering the impact of forecast
economic conditions, the company’s strategic move
We assessed the effectiveness of the Group’s controls in
to sustainability, historical accuracy of previous
the following areas:
forecasts and board approved budgets and current
trading performance;
o initiation, processing and approval of new customers
o We assessed the appropriateness of other key
and/or contracts;
assumptions such as the discount rates and growth
o review and approval of project costs incurred;
rates with reference to publicly available information
o authorisation of monthly project variations;
on comparable companies in the industry and
o review and assessment of significant changes in work
markets in which the Group operates;
in progress balances; and
o We tested the mathematical accuracy of the cash
o review of unapproved variations and claims.
flow models; and
o We performed sensitivity analyses and evaluated
Performed data analytical procedures to corroborate the
whether a reasonably possible change in
expected correlation between revenue and related
assumptions could cause the carrying amount of the
accounts during the year.
cash generating unit to exceed its recoverable
amount.
We selected a sample of contracts based on qualitative and
quantitative factors and performed the following
We evaluated the adequacy of the related disclosures in the
financial report including those made with respect to
judgements and estimates.
o reviewed contract terms and conditions and assessed
whether the individual characteristics of each contract
procedures:
were appropriately accounted for;
o assessed the Group’s ability to deliver budgeted
contract margins by analysing the historical accuracy
of forecasting margins and the relationship of contract
cost versus billing status;
o agreed material contract revenue and cost variations
and claims to information provided by third parties;
o assessed any variable consideration and the basis for
recognition and measurement;
Worley
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
3. Impairment of Goodwill
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
Why significant
financial report.
How our audit addressed the key audit matter
1. Revenue Recognition and Measurement
In accordance with the requirements of
Australian Accounting Standards, the
Why significant
Group performed an annual impairment
test of goodwill after allocating
goodwill to groups of cash-generating
The Group recognises revenue from
units (CGUs).
contracts with customers as performance
obligations are fulfilled over time. This
A value in use model based on
occurs when services are performed or
discounted cash flow forecasts is used
goods are transferred to the customer at
to calculate the recoverable amount of
an amount that reflects the consideration
each group of CGUs. The cash flow
to which the Group expects to be entitled
forecasts and growth rates include
in exchange for those goods or services.
consideration of forecast economic
conditions and the focus on
When the revenue is recognised, estimates
sustainability on the business.
can be required due to the nature and
extent of varying contract conditions,
This was considered to be a Key Audit
which are unique and can be complex.
Matter due to the level of judgement
required to forecast cash flows and
The accurate recording of revenue is
discount rates used to calculate the
highly dependent upon the following
recoverable amount of each Group of
factors:
CGUs.
Appropriate knowledge of individual
The Group’s disclosures are included in
Note 10 of the financial report.
contract characteristics and status of
work - key characteristics would be the
industry and/or geography of the
project and length and type of contract
(lump sum basis or time and materials
basis);
Determination of variable
consideration, including performance
incentives, which are recognised from
the outset of the contract but only to
the extent that it is highly probable
that a significant revenue reversal will
not occur; and
Our audit procedures included the following:
How our audit addressed the key audit matter
We assessed whether the methodology used by the Group
met the requirements of Australian Accounting Standards,
including the allocation of goodwill to groups of CGUs.
Our audit procedures included the following:
We involved our valuation specialists in performing the
following procedures relating to the value in use models of
We assessed whether the policies and methodology used by
the Group’s CGUs:
the Group to recognise revenue met the requirements of
o We assessed the basis of preparing cash flow
Australian Accounting Standards.
forecasts considering the impact of forecast
economic conditions, the company’s strategic move
We assessed the effectiveness of the Group’s controls in
to sustainability, historical accuracy of previous
the following areas:
forecasts and board approved budgets and current
trading performance;
o initiation, processing and approval of new customers
and/or contracts;
o We assessed the appropriateness of other key
o review and approval of project costs incurred;
assumptions such as the discount rates and growth
o authorisation of monthly project variations;
rates with reference to publicly available information
on comparable companies in the industry and
o review and assessment of significant changes in work
markets in which the Group operates;
in progress balances; and
o review of unapproved variations and claims.
o We tested the mathematical accuracy of the cash
flow models; and
o We performed sensitivity analyses and evaluated
Performed data analytical procedures to corroborate the
whether a reasonably possible change in
expected correlation between revenue and related
assumptions could cause the carrying amount of the
accounts during the year.
cash generating unit to exceed its recoverable
amount.
We selected a sample of contracts based on qualitative and
quantitative factors and performed the following
We evaluated the adequacy of the related disclosures in the
procedures:
o reviewed contract terms and conditions and assessed
whether the individual characteristics of each contract
were appropriately accounted for;
financial report including those made with respect to
judgements and estimates.
o assessed the Group’s ability to deliver budgeted
contract margins by analysing the historical accuracy
of forecasting margins and the relationship of contract
cost versus billing status;
o agreed material contract revenue and cost variations
and claims to information provided by third parties;
o assessed any variable consideration and the basis for
recognition and measurement;
A member firm of Ernst & Young Global Limited
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A member firm of Ernst & Young Global Limited
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207
Annual Report 2022
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
Information Other than the Financial Report and Auditor’s Report Thereon
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
The directors are responsible for the other information. The other information comprises the information
financial report.
included in the Company’s 2022 Annual Report, but does not include the financial report and our
auditor’s report thereon.
1. Revenue Recognition and Measurement
Our opinion on the financial report does not cover the other information and accordingly we do not
express any form of assurance conclusion thereon, with the exception of the Remuneration Report and
Why significant
our related assurance opinion.
How our audit addressed the key audit matter
Our audit procedures included the following:
We assessed whether the policies and methodology used by
the Group to recognise revenue met the requirements of
Australian Accounting Standards.
The Group recognises revenue from
In connection with our audit of the financial report, our responsibility is to read the other information and, in
contracts with customers as performance
doing so, consider whether the other information is materially inconsistent with the financial report or our
obligations are fulfilled over time. This
knowledge obtained in the audit or otherwise appears to be materially misstated.
occurs when services are performed or
If, based on the work we have performed, we conclude that there is a material misstatement of this other
goods are transferred to the customer at
information, we are required to report that fact. We have nothing to report in this regard.
an amount that reflects the consideration
to which the Group expects to be entitled
Responsibilities of the directors for the Financial Report
in exchange for those goods or services.
the following areas:
o initiation, processing and approval of new customers
When the revenue is recognised, estimates
The directors of the Company are responsible for the preparation of the financial report that gives a true
can be required due to the nature and
and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for
extent of varying contract conditions,
such internal control as the directors determine is necessary to enable the preparation of the financial
o review and approval of project costs incurred;
which are unique and can be complex.
report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.
o authorisation of monthly project variations;
o review and assessment of significant changes in work
The accurate recording of revenue is
In preparing the financial report, the directors are responsible for assessing the Group’s ability to
highly dependent upon the following
continue as a going concern, disclosing, as applicable, matters relating to going concern and using the
factors:
going concern basis of accounting unless the directors either intend to liquidate the Group or to cease
operations, or have no realistic alternative but to do so.
Appropriate knowledge of individual
o review of unapproved variations and claims.
We assessed the effectiveness of the Group’s controls in
in progress balances; and
and/or contracts;
contract characteristics and status of
work - key characteristics would be the
industry and/or geography of the
project and length and type of contract
(lump sum basis or time and materials
basis);
Performed data analytical procedures to corroborate the
Auditor's Responsibilities for the audit of the financial report
expected correlation between revenue and related
accounts during the year.
We selected a sample of contracts based on qualitative and
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free
from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes
our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with the Australian Auditing Standards will always detect a material
quantitative factors and performed the following
misstatement when it exists. Misstatements can arise from fraud or error and are considered material if,
procedures:
Determination of variable
individually or in the aggregate, they could reasonably be expected to influence the economic decisions of
o reviewed contract terms and conditions and assessed
consideration, including performance
users taken on the basis of this financial report.
whether the individual characteristics of each contract
incentives, which are recognised from
were appropriately accounted for;
the outset of the contract but only to
the extent that it is highly probable
that a significant revenue reversal will
not occur; and
As part of an audit in accordance with the Australian Auditing Standards, we exercise professional
judgement and maintain professional scepticism throughout the audit. We also:
o assessed the Group’s ability to deliver budgeted
contract margins by analysing the historical accuracy
of forecasting margins and the relationship of contract
cost versus billing status;
o agreed material contract revenue and cost variations
and claims to information provided by third parties;
o assessed any variable consideration and the basis for
recognition and measurement;
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208
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
•
included the performance of procedures designed to respond to our assessment of the risks of material
Identify and assess the risks of material misstatement of the financial report, whether due to fraud
misstatement of the financial report. The results of our audit procedures, including the procedures
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
performed to address the matters below, provide the basis for our audit opinion on the accompanying
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
financial report.
material misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
1. Revenue Recognition and Measurement
internal control.
•
Why significant
Obtain an understanding of internal control relevant to the audit in order to design audit
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
How our audit addressed the key audit matter
opinion on the effectiveness of the Group’s internal control.
•
•
The Group recognises revenue from
Our audit procedures included the following:
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
contracts with customers as performance
estimates and related disclosures made by the directors.
obligations are fulfilled over time. This
occurs when services are performed or
goods are transferred to the customer at
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
the Group to recognise revenue met the requirements of
an amount that reflects the consideration
based on the audit evidence obtained, whether a material uncertainty exists related to events or
Australian Accounting Standards.
conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we
to which the Group expects to be entitled
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report
in exchange for those goods or services.
to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our
We assessed the effectiveness of the Group’s controls in
We assessed whether the policies and methodology used by
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
the following areas:
When the revenue is recognised, estimates
can be required due to the nature and
report. However, future events or conditions may cause the Group to cease to continue as a going
o initiation, processing and approval of new customers
concern.
extent of varying contract conditions,
and/or contracts;
•
which are unique and can be complex.
Evaluate the overall presentation, structure and content of the financial report, including the
disclosures, and whether the financial report represents the underlying transactions and events in a
o authorisation of monthly project variations;
o review and approval of project costs incurred;
The accurate recording of revenue is
manner that achieves fair presentation.
highly dependent upon the following
o review and assessment of significant changes in work
in progress balances; and
factors:
•
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
o review of unapproved variations and claims.
Appropriate knowledge of individual
business activities within the Group to express an opinion on the financial report. We are
responsible for the direction, supervision and performance of the Group audit. We remain solely
Performed data analytical procedures to corroborate the
contract characteristics and status of
responsible for our audit opinion.
work - key characteristics would be the
industry and/or geography of the
project and length and type of contract
(lump sum basis or time and materials
identify during our audit.
basis);
We communicate with the directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we
We selected a sample of contracts based on qualitative and
quantitative factors and performed the following
expected correlation between revenue and related
accounts during the year.
We also provide the directors with a statement that we have complied with relevant ethical requirements
procedures:
Determination of variable
regarding independence, and to communicate with them all relationships and other matters that may
consideration, including performance
o reviewed contract terms and conditions and assessed
reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
whether the individual characteristics of each contract
incentives, which are recognised from
threats or safeguards applied.
the outset of the contract but only to
the extent that it is highly probable
were appropriately accounted for;
o assessed the Group’s ability to deliver budgeted
From the matters communicated to the directors, we determine those matters that were of most
contract margins by analysing the historical accuracy
that a significant revenue reversal will
significance in the audit of the financial report of the current year and are therefore the key audit
of forecasting margins and the relationship of contract
not occur; and
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
cost versus billing status;
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
o agreed material contract revenue and cost variations
and claims to information provided by third parties;
o assessed any variable consideration and the basis for
recognition and measurement;
expected to outweigh the public interest benefits of such communication.
Worley
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
included the performance of procedures designed to respond to our assessment of the risks of material
•
Identify and assess the risks of material misstatement of the financial report, whether due to fraud
misstatement of the financial report. The results of our audit procedures, including the procedures
or error, design and perform audit procedures responsive to those risks, and obtain audit evidence
performed to address the matters below, provide the basis for our audit opinion on the accompanying
that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
financial report.
material misstatement resulting from fraud is higher than for one resulting from error, as fraud
may involve collusion, forgery, intentional omissions, misrepresentations, or the override of
internal control.
1. Revenue Recognition and Measurement
•
Why significant
Obtain an understanding of internal control relevant to the audit in order to design audit
How our audit addressed the key audit matter
procedures that are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Group’s internal control.
•
•
•
Our audit procedures included the following:
Evaluate the appropriateness of accounting policies used and the reasonableness of accounting
estimates and related disclosures made by the directors.
The Group recognises revenue from
contracts with customers as performance
obligations are fulfilled over time. This
occurs when services are performed or
goods are transferred to the customer at
an amount that reflects the consideration
to which the Group expects to be entitled
in exchange for those goods or services.
We assessed whether the policies and methodology used by
the Group to recognise revenue met the requirements of
Australian Accounting Standards.
Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and,
based on the audit evidence obtained, whether a material uncertainty exists related to events or
conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report
to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s
report. However, future events or conditions may cause the Group to cease to continue as a going
concern.
the following areas:
o initiation, processing and approval of new customers
We assessed the effectiveness of the Group’s controls in
When the revenue is recognised, estimates
can be required due to the nature and
extent of varying contract conditions,
which are unique and can be complex.
o review and approval of project costs incurred;
Evaluate the overall presentation, structure and content of the financial report, including the
o authorisation of monthly project variations;
disclosures, and whether the financial report represents the underlying transactions and events in a
o review and assessment of significant changes in work
manner that achieves fair presentation.
and/or contracts;
in progress balances; and
The accurate recording of revenue is
highly dependent upon the following
factors:
•
o review of unapproved variations and claims.
Appropriate knowledge of individual
Obtain sufficient appropriate audit evidence regarding the financial information of the entities or
business activities within the Group to express an opinion on the financial report. We are
Performed data analytical procedures to corroborate the
responsible for the direction, supervision and performance of the Group audit. We remain solely
contract characteristics and status of
expected correlation between revenue and related
responsible for our audit opinion.
work - key characteristics would be the
accounts during the year.
industry and/or geography of the
project and length and type of contract
(lump sum basis or time and materials
basis);
We communicate with the directors regarding, among other matters, the planned scope and timing of the
audit and significant audit findings, including any significant deficiencies in internal control that we
identify during our audit.
We also provide the directors with a statement that we have complied with relevant ethical requirements
regarding independence, and to communicate with them all relationships and other matters that may
reasonably be thought to bear on our independence, and where applicable, actions taken to eliminate
threats or safeguards applied.
quantitative factors and performed the following
procedures:
o reviewed contract terms and conditions and assessed
whether the individual characteristics of each contract
were appropriately accounted for;
We selected a sample of contracts based on qualitative and
Determination of variable
o assessed the Group’s ability to deliver budgeted
From the matters communicated to the directors, we determine those matters that were of most
significance in the audit of the financial report of the current year and are therefore the key audit
matters. We describe these matters in our auditor’s report unless law or regulation precludes public
disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should
not be communicated in our report because the adverse consequences of doing so would reasonably be
expected to outweigh the public interest benefits of such communication.
contract margins by analysing the historical accuracy
of forecasting margins and the relationship of contract
cost versus billing status;
o agreed material contract revenue and cost variations
and claims to information provided by third parties;
o assessed any variable consideration and the basis for
consideration, including performance
incentives, which are recognised from
the outset of the contract but only to
the extent that it is highly probable
that a significant revenue reversal will
not occur; and
recognition and measurement;
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209
Annual Report 2022
Report on the audit of the Remuneration Report
Opinion on the Remuneration Report
We have audited the Remuneration Report included in pages 126 to 155 of the directors' report for the
year ended 30 June 2022.
In our opinion, the Remuneration Report of Worley Limited for the year ended 30 June 2022, complies with
section 300A of the Corporations Act 2001.
Responsibilities
The directors of the Company are responsible for the preparation and presentation of the Remuneration
Report in accordance with section 300A of the Corporations Act 2001. Our responsibility is to express an
opinion on the Remuneration Report, based on our audit conducted in accordance with Australian
Auditing Standards.
Ernst & Young
Scott Jarrett
Partner
Sydney
24 August 2022
210
A member firm of Ernst & Young Global Limited
Liability limited by a scheme approved under Professional Standards Legislation
Worley
Independent Limited Assurance Statement in relation to
Worley Limited’s 2022 Sustainability Reporting
Our Conclusion:
EY was engaged by Worley Services Pty Ltd to undertake ‘limited assurance’ as defined by International Auditing Standards,
We have fulfilled the responsibilities described in the Auditor’s Responsibilities for the Audit of the
hereafter referred to as a ‘review’, over selected sustainability metrics and associated performance disclosures included in Worley
Limited’s (‘Worley’) Annual Report for the year ended 30 June 2022. Based on our review, nothing has come to our attention that
Financial Report section of our report, including in relation to these matters. Accordingly, our audit
causes us to believe that the selected sustainability metrics and associated performance disclosures have not been prepared and
included the performance of procedures designed to respond to our assessment of the risks of material
presented fairly, in all material respects, in accordance with the criteria defined below.
misstatement of the financial report. The results of our audit procedures, including the procedures
performed to address the matters below, provide the basis for our audit opinion on the accompanying
What our review covered
financial report.
We reviewed the selected sustainability metrics and associated
performance disclosures, as disclosed in Worley’s 2022 Annual
1. Revenue Recognition and Measurement
Report (‘the Report’) for the year ended 30 June 2022, as shown in
the table below.
Summary of review procedures performed
Our procedures included, but were not limited to:
► Conducting interviews with personnel to understand the
business and process for collecting, collating and reporting the
selected sustainability metrics and associated performance
disclosures
Why significant
Category
Sustainability metrics and
associated performance
disclosures
Assured
Figure
Annual
How our audit addressed the key audit matter
Report
page
► Reviewing evidence to check the Criteria has been correctly
applied in Worley’s preparation of the selected sustainability
metrics
33%
16%
45%
18.6%
Frequency Rate (TRCFR)
► Women Board Members
People
The Group recognises revenue from
► Women Group Executives
contracts with customers as performance
► Women Senior Leaders
obligations are fulfilled over time. This
► Women Employees
occurs when services are performed or
goods are transferred to the customer at
Safety
► Total Recordable Case
an amount that reflects the consideration
to which the Group expects to be entitled
in exchange for those goods or services.
► Serious Case Frequency
0.06
When the revenue is recognised, estimates
Environment ► Total energy use (MWh)
212,345
can be required due to the nature and
extent of varying contract conditions,
which are unique and can be complex.
► Scope 1 Emissions (tCO2e)
► Scope 2 Emissions (tCO2e)
Frequency Rate (LWCFR)
► Lost Workday Case
Rate (SCFR)
25,973
0.04
0.16
22,238
► Total (tCO2e)
The accurate recording of revenue is
highly dependent upon the following
factors:
Criteria applied by Worley
In preparing the selected sustainability metrics and associated
Appropriate knowledge of individual
performance disclosures, Worley has applied the following criteria:
48,211
Key responsibilities
Definitions & Clarifications available at:
https://www.worley.com/sustainability/reports-library
► Worley’s reported criteria detailed in its Sustainability
contract characteristics and status of
work - key characteristics would be the
industry and/or geography of the
project and length and type of contract
(lump sum basis or time and materials
basis);
EY’s responsibility and independence
Our responsibility was to express a limited assurance conclusion on
the selected sustainability metrics.
We were also responsible for maintaining our independence and
Determination of variable
confirm that we have met the independence requirements of the
consideration, including performance
APES 110 Code of Ethics for Professional Accountants and have
incentives, which are recognised from
the required competencies and experience to conduct this
assurance engagement.
the outset of the contract but only to
the extent that it is highly probable
Worley’s responsibility
Worley’s management was responsible for selecting the Criteria
that a significant revenue reversal will
and preparing and fairly presenting the selected sustainability
not occur; and
metrics and associated performance disclosures in accordance with
that Criteria. This responsibility includes establishing and
maintaining internal controls, adequate records and making
estimates that are reasonable in the circumstances.
Our approach to conducting the review
We conducted this review in accordance with the International
Standard on Assurance Engagements ISAE 3000 Assurance
Engagements Other than Audits or Reviews of Historical Financial
Information and the terms of reference for this engagement as
agreed with Worley in our letter of engagement dated 11 April 2022.
► Undertaking data analytics to check the reasonableness of the
Our audit procedures included the following:
data supporting performance disclosures
94
► Conducting detailed testing of underlying source information on
a sample basis to check completeness and accuracy of data
We assessed whether the policies and methodology used by
► Identifying and testing assumptions supporting performance
the Group to recognise revenue met the requirements of
Australian Accounting Standards.
► Performing recalculations of selected sustainability metrics to
determine accuracy of quantities
disclosures
90
► Reviewing the appropriateness of presentation of performance
We assessed the effectiveness of the Group’s controls in
disclosures.
77
76
We believe that the evidence obtained is sufficient and appropriate
the following areas:
to provide a basis for our limited assurance conclusions.
o initiation, processing and approval of new customers
Limited Assurance
and/or contracts;
Procedures performed in a limited assurance engagement vary in
o review and approval of project costs incurred;
nature and timing from, and are less in extent than for, a
o authorisation of monthly project variations;
reasonable assurance engagement. Consequently, the level of
assurance obtained in a limited assurance engagement is
o review and assessment of significant changes in work
substantially lower than the assurance that would have been
obtained had a reasonable assurance engagement been
o review of unapproved variations and claims.
performed.
in progress balances; and
While we considered the effectiveness of management’s internal
controls when determining the nature and extent of our procedures,
Performed data analytical procedures to corroborate the
our assurance engagement was not designed to provide assurance
expected correlation between revenue and related
on internal controls. Our procedures did not include testing controls
or performing procedures relating to checking aggregation or
accounts during the year.
calculation of data within IT systems.
We selected a sample of contracts based on qualitative and
Use of our Assurance Statement
We disclaim any assumption of responsibility for any reliance on
this assurance report to any persons other than management and
the Directors of Worley, or for any purpose other than that for which
it was prepared.
quantitative factors and performed the following
procedures:
o reviewed contract terms and conditions and assessed
Our review included web-based information that was available via
web links as of the date of this statement. We provide no assurance
whether the individual characteristics of each contract
over changes to the content of this web-based information after the
were appropriately accounted for;
date of this assurance statement.
o assessed the Group’s ability to deliver budgeted
contract margins by analysing the historical accuracy
of forecasting margins and the relationship of contract
cost versus billing status;
o agreed material contract revenue and cost variations
and claims to information provided by third parties;
o assessed any variable consideration and the basis for
Ernst & Young
Melbourne, Australia
24 August 2022
Terence Jeyaretnam
Partner
recognition and measurement;
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211
Annual Report 2022
Shareholder information
TOP 20 HOLDINGS OF FULLY PAID ORDINARY SHARES AS AT 1 AUGUST 2022
NAME
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
CITICORP NOMINEES PTY LIMITED
NATIONAL NOMINEES LIMITED
WILACI PTY LTD ATF THE SERPENTINE TRUST
BNP PARIBAS NOMS PTY LTD
SERPENTINE FOUNDATION PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED-GSCO ECA
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
NETWEALTH INVESTMENTS LIMITED
BNP PARIBAS NOMINEES PTY LTD ACF CLEARSTREAM
MR JOHN MICHAEL GRILL
MUTUAL TRUST PTY LTD
BNP PARIBAS NOMINEES PTY LTD
HAJU PTY LIMITED
JUHA PTY LIMITED
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
CITICORP NOMINEES PTY LIMITED
TAYLOR SQUARE DESIGNS PTY LTD
BNP PARIBAS NOMS (NZ) LTD
Total
Total number of current holders for all named classes is 27,814.
SHARES
% OF ISSUED CAPITAL
RANK
212,002,997
91,862,696
52,475,065
25,086,587
22,390,562
14,783,396
5,400,000
5,218,991
4,051,662
3,062,175
3,013,235
2,826,277
2,051,569
1,854,872
1,715,000
1,704,289
1,696,483
1,657,799
1,423,641
1,193,975
455,471,271
40.41
17.51
10.00
4.78
4.27
2.82
1.03
1.00
0.77
0.58
0.58
0.54
0.39
0.35
0.33
0.33
0.32
0.32
0.27
0.23
86.83
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
The table above includes exchangeable shares. The ASX treats these shares as having been converted into ordinary shares of the Company at the time of
their issue for the purposes of the ASX Listing Rules.
SUBSTANTIAL HOLDERS OF 5% OR MORE OF FULLY PAID ORDINARY SHARES AS AT 1 AUGUST 2022*
NAME
Dar Al-Handasah Consultants Shair and Partners Holdings Ltd (Dar)
T. Rowe Price Associates, Inc
John Grill & associated companies
* As disclosed in substantial shareholder notices received by the Company.
NOTICE DATE
SHARES**
14 November 2019
16 September 2021
16 November 2018
118,544,857
40,805,674
34,336,128
** Represents the total number of votes attached to all the voting shares in the Company that the substantial holder or their associates have a relevant
interest in.
RANGE OF FULLY PAID ORDINARY SHARES AS AT 1 AUGUST 2022
SHARES
% OF ISSUED CAPITAL
1 – 1,000
1,001 – 5,000
5,001 – 10,000
10,001 – 100,000
100,001 and over
Total
HOLDERS
16,828
9,055
1,158
697
76
27,814
6,779,162
20,475,528
8,347,931
15,994,915
473,046,506
524,644,042
UNMARKETABLE PARCELS
Minimum $500 parcel at $14.65 per unit
MINIMUM PARCEL SIZE
35
HOLDERS
763
The table above includes exchangeable shares. The ASX treats these exchangeable shares to have been converted into ordinary shares of the Company at the
time of their issue for the purposes of the ASX Listing Rules. In addition to the shares set out in the table, there is one special voting share issued to
Computershare Trust Company of Canada Limited as part of the consideration for the acquisition of the Colt Group.
VOTING RIGHTS
All ordinary shares carry one vote per share without restriction. In the case of the exchangeable shares, voting rights are provided through the special voting
share which carries an aggregate number of votes equal to the number of votes attached to the ordinary shares into which the exchangeable shares are
exchangeable.
212
Worley
1.29
3.90
1.59
3.05
90.17
100.00
SHARES
9,117
Glossary
$, $m, $b Australian dollars unless otherwise stated, Australian millions of dollars, Australian billions of dollars.
Americas Services business line region encompassing sub‐regions of North America and Latin America.
APAC Services business line region encompassing Australia, Pacific, Asia and China.
ASIC Australian Securities and Investments Commission.
ASX Australian Securities Exchange.
Backlog The total dollar value of the amount of revenues expected to be recorded as a result of work performed under contracts or purchase/work orders
already awarded to the Group. With respect to discrete projects an amount is included for the work expected to be received in the future. For multi-year
contracts (i.e. framework agreements and master services agreements) and O&M contracts we include an amount of revenue we expect to receive for 36
months, regardless of the remaining life of the contract.
Due to the variation in the nature, size, expected duration, funding commitments and the scope of services required by our contracts and projects, the timing
of when the backlog will be recognized as revenue can vary significantly between individual contracts and projects.
Board The Board of directors of the Company. This includes non-executive directors and the Chief Executive Officer. The Group Company Secretary is not
included as a member of the Board.
Business Ambition for 1.5°C A campaign led by the Science Based Targets initiative in partnership with the UN Global Compact and the We Mean Business
Coalition. This campaign calls on companies to set science-based emissions reduction targets in line with the most ambitious goals of the Paris Agreement.
CAPEX Capital expenditure.
Carbon dioxide emissions equivalent (CO2e) The universal unit of measurement used to express and compare emissions from various greenhouse gases
based on their global warming potential, converted to the equivalent amount of carbon dioxide. The six key greenhouse gases recognized by the Kyoto
Protocol and adopted by Worley are carbon dioxide (CO2), methane (CH4), nitrous oxide (N2O), hydrofluorocarbons (HFC), perfluorocarbons (PFC), and sulphur
hexafluoride (SF6).
CEO Chief Executive Officer.
Chair The Chair of the Board of Worley Limited.
Champions of Change Coalition A globally recognized, innovative strategy for achieving gender equality, advancing more and diverse women in leadership,
and building respectful and inclusive workforces.
Climate Leaders Coalition A cross-sectoral group of Australian corporate CEOs supporting the Paris Agreement commitments and setting public
decarbonization targets.
CO2e emission factors Worley’s approach to greenhouse gas emissions reporting is consistent with the reporting requirements set out in the Greenhouse
Gas Protocol Corporate Standard. The CO2e emissions factors are sourced from the latest International Energy Agency (IEA) emissions factors and
government sources such as the EIA (US Energy Information Agreement).
As per accepted practice, we do not restate previous year emissions based on emission factor updates.
Company or Worley Worley Limited ACN 096 090 158.
Corporate financial donations (to sustainability and corporate responsibility related activities) Comprise all community investment made by Worley
corporate entities and refers to actual expenditures, not commitments.
Community investments include voluntary donations plus investment of funds in the broader community where the target beneficiaries are external to
Worley. Voluntary donations and investment of funds in the broader community where the target beneficiaries are external to Worley can include:
• Contributions to charities, NGOs and research institutes (unrelated to the organization’s commercial research and development);
• Funds to support community infrastructure, such as recreational facilities; or
• Direct costs of social programs, including arts and educational events.
When reporting infrastructure investments, Worley includes the costs of goods and labor, in addition to capital costs, as well as the operating costs for
support of ongoing facilities or programs. We exclude legal and commercial activities or community investments where the purpose of the investment is
exclusively commercial as part of this calculation.
Corporate financial donations include donations made by Worley’s corporate center via the Worley Foundation, amounts invested in local communities as
required by law In South Africa under the Broad-Based Black Economic Empowerment legislation requirements, and India under section 135 of the
Companies Act 2013, Companies (Corporate Social Responsibility Policy) Rules 2014, as well as contributions by our regional operations as required by local
legislation.
Memberships, some scholarships and marketing spend are generally not included within this definition. Monetary and time contributions by our people, from
payroll deductions or direct giving, volunteering, and value of paid hours are not included within this definition.
The contributions (donations) are captured in the company’s finance systems at the time of payment, using the following codes / category, or equivalent:
• Expenditure category = contributions
• Resource type = charitable donations
Total contributions are measured in Australian Dollars for the reporting period in which the financial transaction is made. Contributions by offices outside of
Australia are converted to Australian Dollars using the average exchange rate during the month that the community initiative was undertaken.
Decarbonization The reduction of carbon dioxide or other carbon compounds emitted into the atmosphere by the activities of industries, countries or
individuals.
Deferred equity plan (DEP) Deferred equity plan is a grant of equity rights which vests over the medium term.
Annual Report 2022
213
Diversity & Inclusion (D&I) At Worley, the diversity of our people includes factors such as race, ethnicity, gender, sexual orientation, socio-economic status,
culture, age, physical ability, education, language, skill levels, family status, religious, political and other beliefs and work styles. We value and harness
diversity to build an environment where people are connected and belong. Inclusion is defined as the outcome to ensure that those that are different and
underrepresented feel welcome and valued.
Downstream The refining of petroleum crude oil and the processing and purifying of raw natural gas, as well as the marketing and distribution of products
derived from crude oil and natural gas.
Days Sales Outstanding (DSO) The time it takes to collect cash from customers.
EBIT Earnings before interest and tax.
EBITA Earnings before interest and tax and amortization on acquired intangibles.
EMEA Services business line region encompassing Europe, Middle East and Africa.
Energy intensity per dollar of revenue Average ratio of energy consumption relative to the aggregated revenue generated by the Company over the
reporting period. This is expressed as a ratio of energy consumption per $ million of aggregated revenue raised (MWh/$ million).
Employee This includes both the Group’s employees and contractors. For headcount purposes, this includes the following Person-type categories, as they
relate to Worley Group; employees, direct contractors, agency contractors, fixed term employees, project hires, expatriate home employees, and FTS job
shopper employees.
Employment contract There are two employment contract categories at Worley:
• Permanent contract: Permanent employee contract for full-time or part-time work for an indeterminate period.
• Fixed term or temporary contract: Fixed term employment contract that ends when a specific time period expires.
Employment types There are two employment types at Worley:
• Full time: A ‘full-time employee’ is defined according to local legislation and practice regarding working time (e.g. minimum of 30 hours per week).
• Part time: A ‘part-time employee’ is defined as an employee whose working hours per week, month or year is less than a ‘full-time employee.
EMTN Europe Medium Term Note Program.
Energy intensity per person Average ratio of energy consumption relative to number of personnel as at the end of the reporting period. This is expressed as
a ratio of energy consumption per person (MWh/person).
EPC Engineering, Procurement and Construction.
EPC contract Under an EPC contract, we will generally be responsible for the design of, the procurement of equipment and materials for, and the construction
and commissioning of an asset, such as a power station. This will generally require us to ensure that the completed asset meets certain specified
performance targets. To do so, we will generally procure the necessary equipment and materials and engage various sub‐contractors ourselves.
EPCM Engineering, Procurement and Construction Management.
EPCM contract Under an EPCM contract, we will generally be responsible for providing our professional services, but unlike an EPC contract, will not be
responsible for delivering a completed asset to our customer. Instead, we will provide engineering and design services to our customer, procure equipment
but only as agent for our customer and manage our customer’s other suppliers as the customer’s representative. We will generally be paid an hourly rate for
the services we provide.
EPS Earnings per share. Determined by dividing the Group NPAT, or Group NPATA, by the weighted average number of the Company’s ordinary shares on
issue during the financial year.
ESG Environmental, social and governance.
Executive Executives include both executive directors and group executives and have authority and responsibility for planning, directing and controlling the
activities of the entity, directly or indirectly.
Factored Sales Pipeline Factored for likelihood of projects proceeding and award to Worley, as at June 2022.
Front-end engineering design (FEED) Basic engineering design providing owners and their financiers with information enabling them to determine whether
or not and, if so, how to commit resources to a proposed project to maximize its projected returns.
FY2021 and FY2022 Financial year 2021 and financial year 2022.
Gender diverse Defined as 40% women, 40% men and 20% either women or men or other.
GID Global Integrated Delivery. Our GID team in India work on projects anywhere in the world and seamlessly transition between projects, allowing us to
achieve high rates of utilization and consistently high quality of work.
Graduate Anyone who is on a formal Worley Group graduate program or hired direct from university.
Greenhouse gas emissions Aggregate total greenhouse gas emissions (Scope 1 and 2) generated by Worley activities, expressed in carbon dioxide emissions
equivalent (CO2e).
Greenhouse gas emissions intensity per dollar of revenue Average ratio of greenhouse gas emissions relative to the aggregated revenue generated by the
Company for the reporting period. This is expressed as a ratio of tonnes of carbon dioxide equivalent per $ million of aggregated revenue raised (tCO2e /$
million).
Greenhouse gas emissions intensity per person Average ratio of greenhouse gas emissions per person member (tCO2e /person). This is calculated using our
Scope 1 and 2 emissions.
Greenhouse gas emissions intensity per unit of energy Average ratio of greenhouse gas emissions per unit energy used (t CO2e /MWh) during the reporting
period.
GRIT GRIT awards - Growth, Resilience, Innovation and Transition awards issued by ALLY, a community of energy industry professionals.
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Group Worley Limited and the entities it controls.
Group Executive Direct reports to the Chief Executive Officer who have executive accountabilities for managing major regional business units (P&L) and
significant functions, as well as developing and executing Group strategy. The Group Company Secretary is a member of the Group Executive.
Gross Margin Sold Gross margin on projects that have been identified as ‘Closed, Won’ in our customer sales platform over the reporting period.
Gross Margin Delivered Gross margin on projects that have been executed and recognized in the Group's earnings over the reporting period.
HSE Health, Safety and Environment.
HSS Health, Safety and Sustainability.
Integrated gas Our subsector Integrated Gas includes all upstream and midstream elements of the natural gas value chain from extraction, production
through gas processing, storage, liquefaction and regasification. It also includes the emerging renewable natural gas.
Key Management Personnel (KMP) Those persons having authority and responsibility for planning, directing and controlling the activities of the entity,
directly or indirectly, including any director (whether executive or otherwise) of that entity. KMP comprise Executives and Non‐Executive Directors.
KPI Key Performance Indicator.
Lantinx People who are of or relate to Latin American origin or descent.
Long-term incentive (LTI) Long-term incentive is a grant of performance rights which vest over the long-term, subject to performance conditions.
Lost Workday Case (LWC) A recordable injury / illness that results in one or more days away from work at the direction of a medical professional. Worley
shall begin counting days away on the day after the injury occurred or the illness began and each calendar day until released to return to work in some
capacity by a medical professional as defined in OSHA 1904.7(b)(3)(ii). A Lost Workday Case is a Recordable Case.
Lost Workday Case Frequency Rate (LWCFR) Lost Workday Case Frequency Rate (LWCFR) is calculated by: The number of LWC multiplied by 200,000 and
divided by the hours worked; i.e. Frequency rates are a normalized measure of performance; they are a Worley reporting requirement.
Low-carbon energy This includes energy derived from renewable sources, low-carbon hydrogen, nuclear, integrated gas, power networks & storage and
combustion with carbon capture.
Low-carbon hydrogen In absence of a global definition, this includes all forms of hydrogen except those derived from fossil fuels without carbon capture and
storage (e.g. grey, black and brown hydrogen).
Low-carbon infrastructure Infrastructure supportive of global net-zero commitments, such as transmission networks required to integrate renewables, port
infrastructure supporting export of low-carbon fuels/offshore wind etc.
Medical Treatment Case (MTC) The management and care of a patient to combat disease or disorder as defined in OSHA CFR 1904.7 (b) (5). Treatment
beyond first aid is Medical Treatment. A Medical Treatment Case is a Recordable Case.
Non-Executive Director (NED) Non‐executive directors of the entity have authority and responsibility for planning, directing and controlling the activities of
the entity, directly or indirectly.
Non-profit organization Organizations that are not operating for the profit or gain of its individual members. Surplus revenue, direct or indirect goes back
into the operation of the organization to carry out its community objectives and goals. Non-profit organizations are often established by and for the
community with minimal or no intervention from local or federal government.
NPAT (net profit after tax) The net profit earned by the Group after deducting all expenses including interest, depreciation and tax. From time to time, for
remuneration purposes, the Board may use its discretion to apply the underlying NPAT which in the Board’s opinion reflects the Company’s operating results.
NPATA (net profit after tax before amortization of acquired intangibles) The net profit after tax excluding the post-tax impact of amortization on intangible
assets acquired through business combinations. From time to time, for remuneration purposes, the Board may use its discretion to apply the underlying
NPATA which in the Board’s opinion reflects the Company’s operating results.
Operational control The boundary for reporting our environmental performance information. Worley reports its energy use and greenhouse gas emissions
with respect to the operational control model as set out by the Greenhouse Gas Protocol, i.e. our sites where we have full authority to introduce and
implement our operating policies.
OPEX Operational expenditure.
Paris Agreement An agreement within the United Nations Framework Convention on Climate Change. The aim of the Paris Agreement is to strengthen the
global response to the threat of climate change by keeping a global temperature rise this century well below 2°C above pre-industrial levels, and to pursue
efforts to limit the temperature increase further to 1.5°C.
People network groups Our People network groups bring employees with shared characteristics or life experiences, such as gender, race, cultural heritage,
sexual orientation and/or gender identity, disability, together in a safe space and offer varying opportunities for members. We also have People network
groups which bring employees with shared passions, such as sustainability or mental health, together. These include social and development opportunities,
mentoring, volunteering, sharing best practice and a chance to gain skills and experience in areas they may not get the opportunity to do in their ‘day job’.
R3 Ready, Response and Recovery. Our program for business security and continuity.
Reporting period Reporting period highlights our efforts from 1 July 2021 to 30 June 2022, unless otherwise stated.
Restricted Workday Case (RWC) Restricted work occurs when, as the result of a work-related injury or illness:
• You keep the employee from performing one or more of the routine functions of his or her job, or from working the full workday that he or she would
otherwise have been scheduled to work OSHA 1904.7(b)(4)(i)(A); or
• A physician or other licensed health care professional recommends that the employee not perform one or more of the routine functions of his or her job, or
not work the full workday that he or she would otherwise have been scheduled to work. OSHA 1904.7(b)(4)(i)(B).
Worley shall begin counting restricted workdays on the day after the injury occurred or the illness began and each calendar day until released to return to full
routine duties. A Restricted Workday Case is a Recordable Case.
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215
Scope 1 emissions Direct greenhouse gas emissions from sources that the Group owns or controls. Our Scope 1 emissions come from burning liquefied
petroleum gas (LPG), natural gas and liquid fuels in heaters and generators, particularly at our fabrication yards.
Scope 2 emissions Indirect greenhouse gas emissions that come from purchased energy – including heat and steam, by the Group. Our Scope 2 emissions
come from the energy used to power our fabrication yards and office buildings.
Scope 3 emissions All upstream & downstream indirect emissions in the value chain of the Group. In previous years we have disclosed Scope 3 emissions
only from Business Travel and partially from Purchased Goods & Services. This year, we are disclosing Scope 3 emissions from:
• Purchased Goods & Services
• Capital Goods
• Fuel and Energy-Related Activities
• Upstream Transportation & Distribution
• Waste Generated in Operations
• Business Travel
• Employee Commuting
• Upstream Leased Assets
• Downstream Transportation & Distribution
• Downstream Leased Assets
• Investments
As a result, our reported Scope 3 emissions increased significantly from FY2021.
Senior Leaders Defined using our Organizational Role Framework (typically tiers one to three). This includes our Group Executive and managers below the
Group Executive who have leadership accountabilities for business units (profit and loss) and functions (and sub-functions).
Serious Case Any fatality or permanent disabling injury / illness or any HSE Event with a potential consequence to result in a fatality or a permanent disabling
injury / illness.
Serious Case Frequency Rate (SCFR) The sum of; Fatalities + Disabilities + High Potential Events multiplied by 200,000 and divided by the hours worked; i.e.
Frequency rates are a normalized measure of performance; they are a Worley reporting requirement.
Skilled volunteering At Worley, the term skilled volunteering is used when our people provide skilled services to community-based organizations in their
time outside of paid working hours on a no fee basis.
STEM Science, Technology, Engineering and Mathematics.
Short-term incentive (STI) Cash award paid for annual performance.
Sustainability Encompasses those elements of our environmental, social and governance (ESG) performance. It also refers to our activities supporting our
customers to meet sustainability objectives on their projects. As part of our Ambition, we provide disclosures on sustainability-related business. How this is
defined is provided on page 27.
Sustainability-linked bond A type of bond instrument for which the financial and/or structural characteristics can vary depending on whether the issuer
achieves predefined sustainability or ESG objectives. It is a forward-looking performance-based instrument with a flexible structure.
Sustainable Solutions Our approach to incorporating sustainable thinking into project delivery and design. Sustainable Solutions enables our people to
identify and quantify sustainability ideas and savings related to carbon and energy use.
Total recordable cases The sum of; Fatalities + Disability/Permanent Illness + LWC + RWC + MTC.
Total recordable case frequency rate (TRCFR) The sum of; Fatalities + Disability/Permanent Illness + LWC + RWC + MTC multiplied by 200,000 and divided
by the number of hours worked; i.e. Frequency rates are a normalized measure of performance; they are a Worley reporting requirement.
Our definitions of Fatalities, Disability / Permanent Illness, LWC, RWC and MTC are aligned to the U.S. Occupational Safety and Health Administration (OSHA)
guidance on work-related injuries and illnesses.
For this reason, TRCFR follows the same definition as Total Recordable Injury Rate (TRIR) and is an equivalent disclosure.
Total shareholder return (TSR) Provides a measure of the change in the value of the Company’s share price over a period, including reinvested dividends,
expressed as a percentage of the opening value of the shares.
Unlock your genius A STEM engagement program stewarded by Worley. It presents complex topics in a digestible format, making them easy to understand.
Upstream The searching for potential underground or underwater crude oil and natural gas fields, drilling of exploratory wells and the subsequent drilling and
operation of the wells that recover and bring the crude oil and/or raw natural gas to the surface.
Women employees This includes both the Group’s employees and contractors. There can be difficulties in the quality of gender data due to voluntary self-
reporting in some jurisdictions (notably the United States where we have a sizable footprint). The percentage women employees metric is provided on this
basis.
Worley Foundation The Worley Foundation was established in 2013 with objectives to support the execution of high impact strategic community projects;
become a vehicle for direct corporate investment, fundraising and volunteering; and expand opportunities for our people to be directly or indirectly involved in
foundation activities.
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Worley
Corporate information
Worley Limited
ACN 096 090 158
DIRECTORS
John Grill, AO (Chair)
Andrew Liveris, AO (Deputy Chair and Lead Independent Director)
Christopher Haynes, OBE
Thomas Gorman
Roger Higgins
Martin Parkinson, AC
Emma Stein
Juan Suárez Coppel
Anne Templeman-Jones
Wang Xiao Bin
Sharon Warburton
Chris Ashton (Chief Executive Officer and Managing Director)
GROUP COMPANY SECRETARY
Nuala O'Leary
REGISTERED OFFICE
Level 17
141 Walker Street
North Sydney NSW 2060
+61 2 8923 6866
AUDITORS
Ernst & Young
BANKERS
Arab Banking Corporation
Bank of America Merrill Lynch
Bank of China
Barclays Bank
BMO Harris Bank
BNP Paribas
China Merchants Bank
Commonwealth Bank of Australia
Credit Agricole Corporation and Investment Bank
First Abu Dhabi Bank
HSBC Bank
ING Bank
Intesa Sanpaolo Bank
Macquarie Bank
Mizuho Bank
Royal Bank of Canada
SABB
Standard Chartered Bank
State Bank of India
UBS AG
U.S. Bank National
Wells Fargo
Westpac Banking Corporation
LAWYERS
Herbert Smith Freehills
SHARE REGISTRY
Computershare Investor Services Pty Limited
Level 3, 60 Carrington Street
Sydney NSW 2000
Australia
Phone: 1300 850 505
Disclaimer
This Annual Report contains forward-looking statements, including
statements regarding climate change and other environmental and
energy transition scenarios. While these forward-looking statements
reflect the Group’s expectations at the date of this Annual Report, they
are not guarantees or predictions of future performance or outcomes.
They involve known and unknown risks and uncertainties, which may
cause actual outcomes and developments to differ materially from
those expressed in the statements contained in this Annual Report.
There are also limitations with respect to the scenario analysis which is
discussed in this Annual Report, and it is difficult to predict which, if any,
of the scenarios might eventuate. Scenario analysis is not an indication
of probable outcomes and relies on assumptions that may or may not
prove to be correct or eventuate.
The Group cautions readers against reliance on any forward-looking
statements or guidance, particularly in light on the long time horizon
which this Annual Report discusses and the inherent uncertainty in
policy, market and technological developments in the future. The Group
makes no representation, assurance or guarantee as to the accuracy,
completeness or likelihood of fulfilment of any forward-looking
statement, any outcomes expressed or implied in any forward-looking
statement or any assumptions on which a forward-looking statement
is based.
Except as required by applicable laws or regulations, the Group does not
undertake to publicly update or review any forward-looking statements,
whether as a result of new information or future events.
Annual Report 2022
217
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