KBR, Inc. (KBR) Posts Q4 Loss of $0.59/Share

KBR, Inc. (NYSE: KBR) reported Q4 EPS of ($0.59), $0.79 worse than the analyst estimate of $0.20. Revenue for the quarter came in at $1.2 billion versus the consensus estimate of $1.21 billion.

"While the overall financial results in 2016 were below expectations, we took actions during the year which have positioned the Company to successfully execute our strategy and grow earnings in the long-term," said Stuart Bradie, President and Chief Executive Officer of KBR, Inc. "Last year was pivotal for KBR with significant highlights such as the completion of several strategic acquisitions: we acquired two well established and highly technical government services companies, a small portfolio of complementary technologies, and a specialty welding and turnarounds company through our Brown & Root joint venture. These acquisitions furthered our long-term strategy to position KBR as a global leader in differentiated professional services, and to do so under an increasingly lower risk, reimbursable-type contract portfolio. These businesses have historically provided stable earnings and cash flows, which should offset the volatility of our financial results associated with large EPC projects traditionally executed by our Engineering & Construction segment. The steady earnings and cash flows also provide us with the financial flexibility to be selective in determining which large EPC prospects we pursue in the future," said Bradie.

"During the fourth quarter, we also resolved a number of outstanding commercial issues and made significant progress in resolving several legal matters including engaging in advanced discussions between Commisa and PEP to settle our legal claim subject to final approval by the parties. Additionally, we resolved several legal matters from the legacy LogCAP III contract, and made significant progress in resolving the SEC investigation and related class action lawsuits related to the restatement of our 2013 financial statements," Bradie continued.

"In 2017, we forecast that over 70% of our revenue will come from work executed under services and reimbursable-type contracts. We also expect to be more competitive in our markets after eliminating annualized costs in excess of $200 million over the past two years. Finally, we made significant progress toward completion of our last domestic EPC power project, which is the final step in exiting the fixed price EPC power business. All of these strategic actions, coupled with key new awards in the Government Services segment during the year, have positioned the Company for stronger long-term earnings growth, and greater free cash flow going forward," Bradie said.

For earnings history and earnings-related data on KBR, Inc. (KBR) click here.

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