KBR Earnings Surpasses Estimates - Analyst Blog
April 26 2013 - 7:59AM
Zacks
KBR Inc.(KBR)recently reported first quarter
2013 results with earnings of 59 cents a share beating the Zacks
Consensus Estimate of 47 cents by 28.6%. However, quarterly
earnings were down 3.3% year over year. Profits in the current
quarter were impacted by five problem projects that the company is
executing since the past quarter.
Revenue
Revenues in the first quarter of 2013 were $1.9 billion compared
to $2.0 billion in the first quarter of 2012. Top line was impacted
by declines in the IGP business group. In addition, the decrease
was also due to lower project activity and project completions on
the Escravos, Skikda and Pearl GTL projects.
Segment Details
Revenues in theHydrocarbons segment were down
15% year over year to $947 million. The job income of the segment
was up 32% year over year, driven by growth across the business.
Backlog during the quarter was $8.6 billion, down 4.6% due to lower
number of projects in Oil & Gas, Downstream and Technology.
Infrastructure, Government and Power(IGP)
segment revenue in the quarter declined 21% year over year to $407
million. In addition, the job income from the segment also
contracted 16% during the reported quarter. Backlog at the end of
the quarter was $2.5 billion, down 10.3%, due to lesser number of
projects across the business.
Servicessegment reported 39% growth in revenue
during the quarter to $485 million, while job income was up 11%.
The increase in job income was primarily driven by several new
module fabrication and turnaround projects ramping in Canada.
Backlog in the services segment grew 2.1%.
Margins and Balance Sheet
Operating income in the first quarter of 2013 was $133 million
compared to $112 million in the prior-year quarter. Operating
margin for the quarter grew 155 basis points to 7.15%, driven by
higher job income, which was partially offset by higher labor
cost.
Exiting the quarter, cash and cash equivalents were $904 million
compared to $1.1 billion as of Dec 31, 2012. During the quarter,
the company had shareholders’ equity of $2.6 billion.
Net cash flow from operating activities was negative $93 million
compared to negative $107 million in the prior-year quarter.
Outlook
Concurrent with the earnings release, the company reaffirmed its
guidance in the range of $2.45 to $2.90 a share.
KBR currently has a Zacks Rank #3 (Hold). However, some other
players operating in the same industry, which can be considered at
the moment are Fluor Corporation (FLR), which has
a Zacks Rank #1 (Strong Buy) and AECOM Technology
Corporation (ACM) and Jacobs Engineering Group,
Inc. (JEC), both having a Zacks Rank #2 (Buy).
AECOM TECH CORP (ACM): Free Stock Analysis Report
FLUOR CORP-NEW (FLR): Free Stock Analysis Report
JACOBS ENGIN GR (JEC): Free Stock Analysis Report
KBR INC (KBR): Free Stock Analysis Report
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