CB&I Reports Third Quarter 2009 Results

October 27, 2009 4:01 PM EDT

THE WOODLANDS, Texas--(BUSINESS WIRE)-- CB&I (NYSE: CBI) today reported net income of $40.8 million, or $0.42 per diluted share, for the third quarter of 2009, compared with $8.6 million, or $0.09 per diluted share, in the third quarter of 2008. Revenue for the quarter was $1.0 billion compared with third quarter 2008 revenue of $1.6 billion.

New awards for the third quarter totaled $1.6 billion, including CB&I's $550 million Gorgon LNG contract in Australia and the $530 million GASCO award in Abu Dhabi.

Cash and cash equivalents increased to $212.0 million as of September 30, up from $88.2 million at year-end 2008.

"We are pleased with the third quarter results and the diverse number of new awards year to date, reaffirming our intent to capitalize on the major projects we have been pursuing in each business sector," said Philip K. Asherman, President and CEO. "We are very confident in our ability to convert major prospects into new backlog in the fourth quarter of 2009 and in 2010, while sustaining the margins in the end markets we serve."

CB&I will host a webcast, including a slide presentation, on October 27 at 4:00 p.m. CDT (5:00 p.m. EDT) to discuss financial and operating results, and answer questions from investors. The webcast is available at www.CBI.com.

About CB&I

CB&I designs, engineers and constructs some of the world's largest energy infrastructure projects, providing a full spectrum of EPC solutions and proven process technologies. Drawing upon more than a century of experience and the expertise of approximately 17,000 employees worldwide, CB&I safely and reliably executes more than 600 projects a year through its three business sectors: CB&I Lummus builds upstream and downstream oil & gas projects, LNG liquefaction and regasification terminals, and a wide range of other energy related projects; CB&I Steel Plate Structures designs, fabricates and constructs storage tanks and containment vessels and their associated systems for the oil & gas, water & wastewater, mining and nuclear industries; Lummus Technology capitalizes on more than 1,500 patents and patent applications to provide process technologies and catalysts for petrochemical facilities, oil refineries and gas processing plants. For more information, visit www.CBI.com or access technical details at Lummus Technology Fact Sheets. If you would like to be added to CB&I's news release email distribution list, visit www.cbi.com/ir/news.htm.

This release contains forward-looking statements regarding CB&I and represents our expectations and beliefs concerning future events. These forward-looking statements are intended to be covered by the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties. When considering any statements that are predictive in nature, depend upon or refer to future events or conditions, or use or contain words, terms, phrases, or expressions such as "achieve", "forecast", "plan", "propose", "strategy", "envision", "hope", "will", "continue", "potential", "expect", "believe", "anticipate", "project", "estimate", "predict", "intend", "should", "could", "may", "might", or similar forward-looking statements, we refer you to the cautionary statements concerning risk factors and "Forward-Looking Statements" described under "Risk Factors" in Item 1A of our Annual Report filed on Form 10-K filed with the SEC for the year ended December 31, 2008, and any updates to those risk factors or "Forward-Looking Statements" included in our subsequent Quarterly Reports on Form 10-Q filed with the SEC, which cautionary statements are incorporated herein by reference.

CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except per share data)

                      Three Months                  Nine Months

                      Ended September 30,           Ended September 30,

                      2009           2008           2009           2008

Revenue               $ 1,010,401    $ 1,563,709    $ 3,518,490    $ 4,431,594

Cost of revenue         892,866        1,462,984      3,123,927      4,362,820

  Gross profit          117,535        100,725        394,563        68,774

  % of Revenue          11.6      %    6.4       %    11.2      %    1.6       %

Selling and
administrative          48,292         54,854         158,778        170,964
expenses

  % of Revenue          4.8       %    3.5       %    4.5       %    3.9       %

Intangibles             6,080          5,894          17,553         17,679
amortization

Other operating
(income) expense,       (1,461    )    105            9,875          44
net

Equity earnings         (9,852    )    (11,950   )    (28,776   )    (34,233   )

  Income (loss) from    74,476         51,822         237,133        (85,680   )
  operations

  % of Revenue          7.4       %    3.3       %    6.7       %    -1.9      %

Interest expense        (4,916    )    (5,388    )    (16,019   )    (14,529   )

Interest income         398            1,744          1,190          7,177

  Income (loss)         69,958         48,178         222,304        (93,032   )
  before taxes

Income tax (expense)    (28,070   )    (37,825   )    (85,311   )    8,588
benefit

  Net income (loss)     41,888         10,353         136,993        (84,444   )

Less: Net income
attributable to         (1,065    )    (1,799    )    (3,934    )    (5,283    )
noncontrolling
interests

  Net income (loss)
  attributable to     $ 40,823       $ 8,554        $ 133,059      $ (89,727   )
  CB&I

Net income (loss)
attributable to CB&I
per share:

  Basic               $ 0.43         $ 0.09         $ 1.40         $ (0.94     )

  Diluted             $ 0.42         $ 0.09         $ 1.38         $ (0.94     )

Weighted average
shares outstanding:

  Basic                 95,727         95,341         95,205         95,754

  Diluted               97,489         96,086         96,318         95,754

CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES

SEGMENT INFORMATION

(in thousands)

             Three Months Ended                            Nine Months Ended

             September 30,         September 30,           September 30,        September 30,

             2009                  2008                    2009                 2008

                          % of                    % of                  % of                   % of

NEW                       Total                   Total                 Total                  Total
AWARDS*

CB&I Steel
Plate        $ 1,433,383  87   %   $ 338,427      48   %   $ 1,963,712  73   %  $ 1,803,860    56    %
Structures

CB&I           109,678    7    %     220,335      31   %     491,614    18   %    936,274      29    %
Lummus

Lummus         97,320     6    %     144,918      21   %     224,775    9    %    476,766      15    %
Technology

Total        $ 1,640,381           $ 703,680               $ 2,680,101          $ 3,216,900

                          % of                    % of                  % of                   % of

REVENUE                   Total                   Total                 Total                  Total

CB&I Steel
Plate        $ 383,453    38   %   $ 500,489      32   %   $ 1,261,458  36   %  $ 1,460,475    33    %
Structures

CB&I           528,347    52   %     952,669      61   %     1,994,994  57   %    2,634,985    59    %
Lummus

Lummus         98,601     10   %     110,551      7    %     262,038    7    %    336,134      8     %
Technology

Total        $ 1,010,401           $ 1,563,709             $ 3,518,490          $ 4,431,594

                          % of                    % of                  % of                   % of

INCOME
(LOSS)                    Revenue                 Revenue               Revenue                Revenue
FROM
OPERATIONS

CB&I Steel
Plate        $ 34,284     8.9  %   $ 54,108       10.8 %   $ 105,049    8.3  %  $ 157,762      10.8  %
Structures

CB&I           18,551     3.5  %     (29,623   )  (3.1 %)    75,095     3.8  %    (326,300  )  (12.4 %)
Lummus

Lummus         21,641     21.9 %     27,337       24.7 %     56,989     21.7 %    82,858       24.7  %
Technology

Total        $ 74,476     7.4  %   $ 51,822       3.3  %   $ 237,133    6.7  %  $ (85,680   )  (1.9  %)

* New awards represents the value of new project commitments received by the Company during a given
period.

CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

                                                    September 30,  December 31,

                                                    2009           2008

ASSETS

Current assets                                      $ 1,188,900    $ 1,191,115

Equity investments                                    132,084        130,031

Property and equipment, net                           329,191        336,093

Goodwill and other intangibles, net                   1,186,190      1,198,674

Other non-current assets                              144,123        144,805

 Total assets                                       $ 2,980,488    $ 3,000,718

LIABILITIES AND SHAREHOLDERS' EQUITY

Revolver borrowings and notes payable               $ 2,326        $ 523

Current maturity of long-term debt                    40,000         40,000

Other current liabilities                             1,658,948      1,947,602

Long-term debt                                        120,000        120,000

Other non-current liabilities                         348,579        318,740

Shareholders' equity                                  810,635        573,853

 Total liabilities and shareholders' equity         $ 2,980,488    $ 3,000,718

CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS AND OTHER FINANCIAL DATA

(in thousands)

                                                    Nine Months

                                                    Ended September 30,

                                                    2009           2008

CASH FLOWS

Cash flows from operating activities                $ 107,845      $ 94,345

Cash flows from investing activities                  (16,877   )    (80,693   )

Cash flows from financing activities                  32,844         (77,163   )

Increase (decrease) in cash and cash equivalents      123,812        (63,511   )

Cash and cash equivalents, beginning of the year      88,221         305,877

Cash and cash equivalents, end of the period        $ 212,033      $ 242,366

OTHER FINANCIAL DATA

Decrease in receivables, net                        $ 64,838       $ 66,867

Change in contracts in progress, net                  (51,173   )    45,085

Increase in non-current contract retentions           (3,438    )    (15       )

(Decrease) increase in accounts payable               (160,403  )    93,019

 Change in contract capital                         $ (150,176  )  $ 204,956

Depreciation and amortization expense               $ 59,941       $ 58,042

Capital expenditures                                $ 36,133       $ 82,057

Backlog *                                           $ 4,866,422    $ 6,199,040

* Backlog includes the value of new award commitments until work is performed
and revenue is recognized or until cancellation.

Backlog may also fluctuate with currency movements.

    Source: CB&I

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