KBR, Inc. (NYSE: KBR) reported Q2 EPS of $0.34, in-line with the analyst estimate of $0.34. Revenue for the quarter came in at $1.27 billion versus the consensus estimate of $1.14 billion.

"I'm pleased to report that KBR had a solid second quarter with positive performances from all three of our business segments," said Stuart Bradie, KBR President and CEO.

"We experienced continued year over year organic growth in our Government Services business, increased profitability in Technology and stabilized sequential revenues with a very healthy book-to-bill in our Hydrocarbons business," Bradie continued. "The signals we are getting from customers on the capital projects outlook in Hydrocarbons has improved measurably in recent months. In addition, on the operations side we maintained our targeted margins in all segments and produced a healthy cash flow result. Improving fundamentals in our government and hydrocarbons end markets coupled with our strategic positioning and performance of our recent acquisitions enable us to raise our outlook for the year," said Bradie. "Our people continue to be the foundation of this company and its success, consistently delivering the best execution and one of the strongest safety performances in the business."

Guidance

We are increasing the company's full year 2018 fully diluted adjusted earnings per share guidance range to $1.40 to $1.50 per share from the previous range of $1.35 to $1.45. Our guidance of earnings per share is on an adjusted EPS basis, which excludes legacy legal fees for U.S. Government contracts, acquisition & integration-related expenses associated with the Aspire and SGT acquisitions, new amortization associated with the Aspire acquisitions and the gain on the Aspire consolidation. The estimated legacy legal fees do not assume any cost reimbursement from the U.S. Government that could occur in the future. A reconciliation of GAAP EPS to adjusted EPS guidance is located at the end of this release.

Our estimated effective tax rate for 2018 is unchanged and estimated to range from 22% to 24%. The operating cash flows are also unchanged and estimated to range from $125 million to $175 million for 2018.

GUIDANCE:

KBR, Inc. sees FY2018 EPS of $1.40-$1.50, versus the consensus of $1.39.

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