JEC Jacobs Engineering Group Inc

Foster Wheeler AG(FWLT) recently stated that one of the subsidiaries of its Global Power Group has received a contract from SCS Proyectos, S.A.P.I. de C.V. The contract involves the design and supply of two heat recovery steam generators that are needed to be installed in a cogeneration power plant for the TEREFTALATOS MEXICANOS S.A. DE C.V. TOP 1002 Cogeneration Project in Cosoleacaque, Veracruz, Mexico. This plant is owned by Cogeneración de Energía Limpia de Cosoleacaque, S.A. de C.V.

Although the financial terms of the contract were not disclosed, Foster Wheeler has received the necessary approvals to execute on this contract. The contract value was, however, included in the company’s second-quarter 2012 order bookings. The company intends to deliver the two steam generators by mid 2013.

As per the terms of this contract, Foster Wheeler will design, supply and provide advisory services for the production and start-up of the two heat recovery steam generators, which will be attached to two LM 6000PF combustion turbines.

In the recently reported quarter, Global Power operating revenue (FW Scope) stood at $275.0 million, down 4.8% from $289.0 million in the year-ago quarter. Penalty component of an adverse court decision, foreign exchange loss of $3.2 million and quarterly delay in profit recognition from a recently signed agreement led to a loss in the reported quarter. However,it witnessed an improvement in demand for its services globally, resulting in an increase of Scope backlog during the quarter.

Jacobs Engineering Group Inc. (JEC) is a major competitor of Foster Wheeler with a series of contract wins over the past quarter. Foster Wheeler currently has a short-term Zacks #3 Rank, which implies ‘Hold’ rating on the stock.

 
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