$0.45 per diluted share for third quarter 2009 net income
attributable to KBR, Inc.
HOUSTON--(BUSINESS WIRE)--Oct. 29, 2009--
KBR (NYSE:KBR):
-
Revenue for the first nine months of 2009 increased 12% over the first
nine months of the previous year
-
Operating income for the first nine months of 2009 increased 6% over
the first nine months of 2008
-
Solid backlog at the end of September 30, 2009 of $13.5 billion, up 9%
over the sequential quarter; no material project cancellations during
the third quarter of 2009
-
Continued strong balance sheet with $1.0 billion cash and equivalents
-
Corporate G&A for the first nine months of 2009 down 4% compared to
the first nine months of 2008, despite increased revenue over the same
time period
KBR (NYSE:KBR) announced today that third quarter 2009 net income
attributable to KBR was $73 million, or $0.45 per diluted share,
compared to net income attributable to KBR of $85 million, or $0.51 per
diluted share, in the third quarter of 2008. Net income attributable to
KBR for the third quarter of 2008 included income from discontinued
operations of $11 million, or $0.07 per diluted share resulting from
foreign tax credits related to the sale of KBR’s 51% ownership interest
in Devonport Management Limited.
Consolidated revenue in the third quarter of 2009 was $2.8 billion
compared to $3.0 billion in the third quarter of 2008. Consolidated
operating income was $131 million in the third quarter of 2009 compared
to $144 million in the third quarter of 2008.
For the third quarter of 2009, consolidated operating income included a
$17 million reduction of a prior 2008 charge related to an unfavorable
jury verdict on the LogCAP III contract and a net $25 million charge
related to equipment failures, subcontractor claims, schedule delays,
and project close out issues on three LNG projects which are now
commercially operational. Net income for the third quarter of 2009
included a $10 million tax benefit related to a return to accrual
adjustment for the 2008 tax year, partially offset by a $6 million
impairment of goodwill at a staffing company acquired as part of the
BE&K acquisition.
“The highlight of the quarter was the award for the Gorgon LNG project
for engineering, procurement, and construction management services. KBR
has been involved in this world-class project for several years and we
are excited to have the opportunity to deliver quality execution on this
project for our customers,” said Bill Utt, Chairman, President, and
Chief Executive Officer of KBR. “Operationally, our business delivered
solid performance, despite experiencing several isolated items related
to the completion or near completion of several LNG projects. In
addition, we had a 15 percent quarter over quarter decline in our LogCAP
revenue, consistent with reduced activity levels in Iraq.”
2009 Third Quarter Business Unit Results
Upstream business unit income was $48 million in the third quarter of
2009 compared to business unit income of $53 million in the third
quarter of 2008. Business unit income in the third quarter of 2009 had
positive contributions from various gas monetization projects, including
the Pearl GTL, Skikda LNG, Gorgon LNG, and Escravos GTL projects, an
offshore related project in the Caspian area, the PNG LNG project, and
several topside engineering projects.
Government and Infrastructure business unit income was $89 million in
the third quarter of 2009 compared to business unit income of $104
million in the third quarter of 2008. Business unit income in the third
quarter of 2009 had positive contributions from Iraq-related activities,
the Allenby & Connaught project, work on the CENTCOM project, and
numerous infrastructure projects, including the Qatar-Bahrain Causeway.
Business unit income in the third quarters of 2009 and 2008 included a
$17 million and $13 million reduction of a previous $40 million charge
related to an unfavorable jury verdict from litigation with a
subcontractor on the LogCAP III contract in the second quarter of 2008,
respectively.
Services business unit income was $36 million in the third quarter of
2009 compared to business unit income of $27 million in the third
quarter of 2008. Business unit income in the third quarter of 2009 had
positive contributions from power projects in Georgia and Texas, the
Scotford Upgrader project in Canada, construction and maintenance work
in Texas, the offshore service vessels in the Gulf of Mexico, and an
activated carbon project in Louisiana.
Downstream business unit income was $10 million in the third quarter of
2009 compared to business unit income of $15 million in the third
quarter of 2008. Business unit income in the third quarter of 2009 had
positive contributions from program management services for the Ras
Tanura project in Saudi Arabia, the Lobito refinery FEED in Angola, and
several other refining projects.
Technology business unit income was $7 million in the third quarter of
2009 compared to business unit income of $4 million in the third quarter
of 2008. Business unit income in the third quarter of 2009 had positive
contributions from several ammonia license and basic engineering
projects in South America, one project in India, and one project
completion in Trinidad.
Ventures business unit income was $4 million in the third quarter of
2009 compared to business unit income of $0 million in the third quarter
of 2008. Business unit income in the third quarter of 2009 had positive
contributions from increased construction progress and lower maintenance
costs on the Aspire Defence project, as well as lower indexed linked
interest expense on two of our U.K. projects.
Corporate general and administrative expense in the third quarter of
2009 was $54 million, down slightly from the $55 million reported in the
prior year third quarter.
Total cash flows used in operating activities for the third quarter of
2009 were $19 million, which includes a net $116 million decrease in
advanced payments associated with consolidated joint ventures and a
contract in progress. Total cash flows used in operating activities for
the first nine months of 2009 were $27 million, which includes a net
$149 million decrease in advanced payments associated with consolidated
joint ventures and a contract in progress.
Significant Achievements and Awards
-
KBR announced that a KBR led Joint Venture consisting of partners JGC,
Clough and Hatch (Kellogg Joint Venture Group - KJVG) was awarded by
Chevron Australia Pty Ltd an estimated AUD ~ 2.7 billion contract to
Engineer, Procure and Construction Manage (EPCM) the LNG downstream
and logistics portion of the multi-billion dollar Chevron-operated
Gorgon LNG Project. KJVG will execute and construct the Liquefied
Natural Gas (LNG) facility on Barrow Island, consisting of three 5
million tonne per annum LNG trains, gas processing and treatment
facilities, product storage and offloading, complete offsites,
utilities and accommodations. The EPCM effort is a modular
construction strategy to minimize impact on the island during the
construction phase and is being conducted from two main operating
centers located in Perth, Australia and London, UK with support from
global centers in USA, Singapore, Indonesia and Japan. KJVG plans to
utilize several fabrication yards across South East Asia and Australia
to support the planned 250,000 tons of LNG modules.
-
KBR announced it was awarded a contract by the Saudi Arabian Oil
Company (Saudi Aramco) to provide front-end engineering and design
(FEED), and Project Management Services (PMS) for its Shaybah Natural
Gas Liquids (NGL) Program at Shaybah field located in Saudi Arabia.
KBR will provide FEED and PMS services to develop the process design,
layout, develop equipment and material specifications, prepare bid
packages and develop an estimate for the construction for several
projects related to the Shaybah NGL Program facilities.
-
KBR announced its M.W. Kellogg Ltd. (MWKL) subsidiary has been awarded
two contracts by StatoilHydro at the Kårstø Gas Plant, near Stavanger,
Norway. MWKL will provide Engineering, Procurement and Construction
Assistance (EPCa) for the Double Inlet Crossover Project (DIXO) and
NGL Metering Project. The NGL Metering Upgrade project is to take
place in parallel to the KEP 2010 EPCa project already being
undertaken by MWKL, so the effective interface, coordination, and
planning for all phases of the project is critical to the success of
the project.
-
KBR announced it was awarded a contract by Sonangol, E.P. to provide
license and engineering services for grassroots FCC and
Hydroprocessing technologies for the Sonaref Refinery to be located in
Lobito, Angola. KBR will provide licensing services for the state of
the art Orthoflow FCC technology and a Moderate Pressure Hydrocracking
Unit. This integrated solution will provide Sonangol the flexibility
to control the gasoline to diesel ratio and to take advantage of
seasonal demands. The company will also deliver Diesel Hydrotreating
and Kerosene Hydrotreating technologies, for the production of premium
distillate products.
-
KBR announced it was awarded a contract by ConocoPhillips and the
Saudi Arabian Oil Company to provide detailed engineering and
procurement services for the utilities package and the interconnecting
systems and pipe racks for the companies’ joint Yanbu Export Refinery
Project. The project is under engineering, procurement and
construction (EPC) tendering process for the final investment decision
by the project sponsors, and consists of a 400,000 barrel-per-day,
full-conversion refinery in Yanbu Industrial City, Kingdom of Saudi
Arabia. This award is an extension of KBR’s current project management
contract (PMC) with ConocoPhillips and Saudi Aramco and follows the
completion of front-end engineering and design services for the Yanbu
Refinery by KBR.
-
KBR announced it was awarded a contract by Verkhnechonskneftegas
(VCNG) to provide front-end engineering and design services for the VC
FFD Project located in the Eastern Siberia region of Russia. KBR will
provide FEED services for a single new build, 140,000 barrels of oil
per day facility, which will be tied back via a new 85-kilometer
pipeline, to the existing East Siberian Pacific Ocean (ESPO) pipeline.
The VC oil & gas field is planned to produce a plateau production of
140-kbopd from 430 production wells, and there will be 215 water
injection wells. The field development will involve a total of 645
wells distributed over 75 well pads.
KBR is a global engineering, construction and services company
supporting the energy, hydrocarbon, government services, minerals, civil
infrastructure, power, and industrial markets. For more information,
visit www.kbr.com.
NOTE: The statements in this press release that are not historical
statements, including statements regarding future financial performance
and backlog information, are forward-looking statements within the
meaning of the federal securities laws. These statements are subject to
numerous risks and uncertainties, many of which are beyond the company’s
control, that could cause actual results to differ materially from the
results expressed or implied by the statements. These risks and
uncertainties include, but are not limited to: the outcome of and the
publicity surrounding audits and investigations by domestic and foreign
government agencies and legislative bodies; potential adverse
proceedings by such agencies and potential adverse results and
consequences from such proceedings; the scope and enforceability of the
company’s indemnities from Halliburton Company; changes in capital
spending by the company’s customers; the company’s ability to obtain
contracts from existing and new customers and perform under those
contracts; structural changes in the industries in which the company
operates, escalating costs associated with and the performance of
fixed-fee projects and the company’s ability to control its cost under
its contracts; claims negotiations and contract disputes with the
company’s customers; changes in the demand for or price of oil and/or
natural gas; protection of intellectual property rights; compliance with
environmental laws; changes in government regulations and regulatory
requirements; compliance with laws related to income taxes; unsettled
political conditions, war and the effects of terrorism; foreign
operations and foreign exchange rates and controls; the development and
installation of financial systems; increased competition for employees;
the ability to successfully complete and integrate acquisitions; and
operations of joint ventures, including joint ventures that are not
controlled by the company.
KBR’s Annual Report on Form 10-K dated February 25, 2009, recent Current
Reports on Forms 8-K, and other Securities and Exchange Commission
filings discuss some of the important risk factors that KBR has
identified that may affect the business, results of operations and
financial condition. KBR undertakes no obligation to revise or update
publicly any forward-looking statements for any reason.
|
|
|
|
|
|
|
|
|
KBR, Inc.: Condensed Consolidated Statements of Income
|
|
(Millions of dollars and shares, except per share data) (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months
|
|
Three Months
|
|
|
|
Ended
|
|
Ended
|
|
|
|
September 30,
|
|
June 30,
|
|
Revenue:
|
|
2009
|
|
2008
|
|
2009
|
|
Government and Infrastructure
|
|
$
|
1,376
|
|
|
$
|
1,759
|
|
|
$
|
1,567
|
|
|
Upstream
|
|
|
735
|
|
|
|
550
|
|
|
|
787
|
|
|
Services
|
|
|
566
|
|
|
|
539
|
|
|
|
588
|
|
|
Downstream
|
|
|
123
|
|
|
|
138
|
|
|
|
124
|
|
|
Technology
|
|
|
27
|
|
|
|
19
|
|
|
|
23
|
|
|
Ventures
|
|
|
5
|
|
|
|
1
|
|
|
|
3
|
|
|
Other
|
|
|
8
|
|
|
|
12
|
|
|
|
9
|
|
|
Total revenue
|
|
$
|
2,840
|
|
|
$
|
3,018
|
|
|
$
|
3,101
|
|
|
Business unit income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Government and Infrastructure
|
|
$
|
89
|
|
|
$
|
104
|
|
|
$
|
80
|
|
|
Upstream
|
|
|
48
|
|
|
|
53
|
|
|
|
65
|
|
|
Services
|
|
|
36
|
|
|
|
27
|
|
|
|
29
|
|
|
Downstream
|
|
|
10
|
|
|
|
15
|
|
|
|
14
|
|
|
Technology
|
|
|
7
|
|
|
|
4
|
|
|
|
5
|
|
|
Ventures
|
|
|
4
|
|
|
|
—
|
|
|
|
1
|
|
|
Other
|
|
|
(5
|
)
|
|
|
1
|
|
|
|
—
|
|
|
Total business unit income
|
|
|
189
|
|
|
|
204
|
|
|
|
194
|
|
|
Unallocated costs: Loss on disposition of assets - corporate
|
|
|
(1
|
)
|
|
|
—
|
|
|
|
—
|
|
|
Labor cost absorption
|
|
|
(3
|
)
|
|
|
(5
|
)
|
|
|
(3
|
)
|
|
Corporate general and administrative
|
|
|
(54
|
)
|
|
|
(55
|
)
|
|
|
(54
|
)
|
|
Total operating income
|
|
|
131
|
|
|
|
144
|
|
|
|
137
|
|
|
Interest income, net
|
|
|
—
|
|
|
|
7
|
|
|
|
—
|
|
|
Foreign currency loss, net
|
|
|
—
|
|
|
|
—
|
|
|
|
(4
|
)
|
|
Other non-operating expense
|
|
|
(1
|
)
|
|
|
—
|
|
|
|
(1
|
)
|
|
Income from continuing operations before income taxes and
noncontrolling interests
|
|
|
130
|
|
|
|
151
|
|
|
|
132
|
|
|
Provision for income taxes
|
|
|
(33
|
)
|
|
|
(55
|
)
|
|
|
(49
|
)
|
|
Income from continuing operations, net of tax
|
|
$
|
97
|
|
|
$
|
96
|
|
|
$
|
83
|
|
|
Income from discontinued operations, net of tax benefit of $0,
$11, and $0
|
|
|
—
|
|
|
|
11
|
|
|
|
—
|
|
|
Net income
|
|
|
97
|
|
|
|
107
|
|
|
|
83
|
|
|
Less: Net income attributable to noncontrolling interests
|
|
|
(24
|
)
|
|
|
(22
|
)
|
|
|
(16
|
)
|
|
Net income attributable to KBR
|
|
$
|
73
|
|
|
$
|
85
|
|
|
$
|
67
|
|
|
Reconciliation of net income attributable to KBR, Inc. common
shareholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
$
|
73
|
|
|
$
|
74
|
|
|
$
|
67
|
|
|
Discontinued operations, net
|
|
|
—
|
|
|
|
11
|
|
|
|
—
|
|
|
Net income attributable to KBR
|
|
|
73
|
|
|
|
85
|
|
|
|
67
|
|
|
Basic income per share(a):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations - Basic
|
|
$
|
0.46
|
|
|
$
|
0.45
|
|
|
$
|
0.42
|
|
|
Discontinued operations, net - Basic
|
|
|
—
|
|
|
|
0.07
|
|
|
|
—
|
|
|
Net income attributable to KBR per share - Basic
|
|
|
0.46
|
|
|
|
0.51
|
|
|
|
0.42
|
|
|
Diluted income per share(a):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Continuing operations – Diluted
|
|
$
|
0.45
|
|
|
$
|
0.44
|
|
|
$
|
0.42
|
|
|
Discontinued operations, net – Diluted
|
|
|
—
|
|
|
|
0.07
|
|
|
|
—
|
|
|
Net income attributable to KBR per share - Diluted
|
|
|
0.45
|
|
|
|
0.51
|
|
|
|
0.42
|
|
|
Basic weighted average shares outstanding
|
|
|
160
|
|
|
|
166
|
|
|
|
160
|
|
|
Diluted weighted average shares outstanding
|
|
|
161
|
|
|
|
167
|
|
|
|
161
|
|
|
Cash dividends declared per share
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
|
$
|
0.05
|
|
(a) Due to the effect of rounding, the sum of the individual per share
amounts may not equal the total shown.
|
|
|
|
|
|
|
|
|
|
|
KBR, Inc.: Condensed Consolidated Statements of Income
|
|
(Millions of dollars and shares, except per share data) (Unaudited)
|
|
|
|
|
|
|
|
|
Nine Months Ended
|
|
|
|
September 30,
|
|
Revenue:
|
|
2009
|
|
2008
|
|
Government and Infrastructure
|
|
$
|
4,672
|
|
|
$
|
5,150
|
|
|
Upstream
|
|
|
2,273
|
|
|
|
1,860
|
|
|
Services
|
|
|
1,723
|
|
|
|
776
|
|
|
Downstream
|
|
|
360
|
|
|
|
339
|
|
|
Technology
|
|
|
70
|
|
|
|
61
|
|
|
Ventures
|
|
|
16
|
|
|
|
(3
|
)
|
|
Other
|
|
|
27
|
|
|
|
12
|
|
|
Total revenue
|
|
$
|
9,141
|
|
|
$
|
8,195
|
|
|
Business unit income (loss):
|
|
|
|
|
|
|
|
|
|
Government and Infrastructure
|
|
$
|
250
|
|
|
$
|
247
|
|
|
Upstream
|
|
|
186
|
|
|
|
197
|
|
|
Services
|
|
|
89
|
|
|
|
57
|
|
|
Downstream
|
|
|
24
|
|
|
|
37
|
|
|
Technology
|
|
|
15
|
|
|
|
16
|
|
|
Ventures
|
|
|
15
|
|
|
|
(4
|
)
|
|
Other
|
|
|
(4
|
)
|
|
|
1
|
|
|
Total business unit income
|
|
|
575
|
|
|
|
551
|
|
|
Unallocated costs: Loss on disposition of assets - corporate
|
|
|
(1
|
)
|
|
|
—
|
|
|
Labor cost absorption
|
|
|
(5
|
)
|
|
|
—
|
|
|
Corporate general and administrative
|
|
|
(157
|
)
|
|
|
(163
|
)
|
|
Total operating income
|
|
|
412
|
|
|
|
388
|
|
|
Interest income, net
|
|
|
1
|
|
|
|
32
|
|
|
Foreign currency gains (losses), net
|
|
|
1
|
|
|
|
(2
|
)
|
|
Other non-operating expense
|
|
|
(2
|
)
|
|
|
—
|
|
|
Income from continuing operations before income taxes and
noncontrolling interests
|
|
|
412
|
|
|
|
418
|
|
|
Provision for income taxes
|
|
|
(137
|
)
|
|
|
(151
|
)
|
|
Income from continuing operations, net of tax
|
|
$
|
275
|
|
|
$
|
267
|
|
|
Income from discontinued operations, net of tax benefit of $0 and
$11
|
|
|
—
|
|
|
|
11
|
|
|
Net income
|
|
|
275
|
|
|
|
278
|
|
|
Less: Net income attributable to non controlling interests
|
|
|
(58
|
)
|
|
|
(47
|
)
|
|
Net income attributable to KBR
|
|
$
|
217
|
|
|
$
|
231
|
|
|
Reconciliation of net income attributable to KBR, Inc. common
shareholders:
|
|
|
|
|
|
|
|
|
|
Continuing operations
|
|
$
|
217
|
|
|
$
|
220
|
|
|
Discontinued operations, net
|
|
|
—
|
|
|
|
11
|
|
|
Net income attributable to KBR
|
|
|
217
|
|
|
|
231
|
|
|
Basic income per share(a):
|
|
|
|
|
|
|
|
|
|
Continuing operations – Basic
|
|
$
|
1.35
|
|
|
$
|
1.30
|
|
|
Discontinued operations – Basic
|
|
|
—
|
|
|
|
0.07
|
|
|
Net income attributable to KBR per share - Basic
|
|
|
1.35
|
|
|
|
1.37
|
|
|
Diluted income per share(a):
|
|
|
|
|
|
|
|
|
|
Continuing operations – Diluted
|
|
$
|
1.35
|
|
|
$
|
1.30
|
|
|
Discontinued operations – Diluted
|
|
|
—
|
|
|
|
0.07
|
|
|
Net income attributable to KBR per share - Diluted
|
|
|
1.35
|
|
|
|
1.37
|
|
|
Basic weighted average shares outstanding
|
|
|
160
|
|
|
|
168
|
|
|
Diluted weighted average shares outstanding
|
|
|
161
|
|
|
|
169
|
|
|
Cash dividends declared per share
|
|
$
|
0.15
|
|
|
$
|
0.15
|
|
(a) Due to the effect of rounding, the sum of the individual per share
amounts may not equal the total shown.
|
|
|
|
|
KBR, Inc.: Condensed Consolidated Balance Sheets
|
|
(In millions) (Unaudited)
|
|
|
|
|
|
September 30,
|
|
December 31,
|
|
|
|
2009
|
|
2008
|
|
Assets
|
|
Current assets:
|
|
|
|
|
|
|
|
|
|
Cash and equivalents
|
|
$
|
1,020
|
|
|
$
|
1,145
|
|
|
Receivables:
|
|
|
|
|
|
|
|
|
|
Accounts receivable, net
|
|
|
1,538
|
|
|
|
1,312
|
|
|
Unbilled receivables on uncompleted contracts
|
|
|
732
|
|
|
|
835
|
|
|
Total receivables
|
|
|
2,270
|
|
|
|
2,147
|
|
|
Deferred income taxes
|
|
|
130
|
|
|
|
107
|
|
|
Other current assets
|
|
|
507
|
|
|
|
743
|
|
|
Total current assets
|
|
|
3,927
|
|
|
|
4,142
|
|
|
Property, plant, and equipment, net of accumulated depreciation of
$258 and $224
|
|
|
242
|
|
|
|
245
|
|
|
Goodwill
|
|
|
691
|
|
|
|
694
|
|
|
Intangible assets, net
|
|
|
61
|
|
|
|
73
|
|
|
Equity in and advances to related companies
|
|
|
197
|
|
|
|
185
|
|
|
Noncurrent deferred income taxes
|
|
|
210
|
|
|
|
167
|
|
|
Unbilled receivables on uncompleted contracts
|
|
|
135
|
|
|
|
134
|
|
|
Other assets
|
|
|
115
|
|
|
|
244
|
|
|
Total assets
|
|
$
|
5,578
|
|
|
$
|
5,884
|
|
|
|
|
|
|
|
|
|
|
|
|
Liabilities and Shareholders’ Equity
|
|
Current liabilities:
|
|
|
|
|
|
|
|
|
|
Accounts payable
|
|
$
|
1,173
|
|
|
$
|
1,387
|
|
|
Due to former parent, net
|
|
|
54
|
|
|
|
54
|
|
|
Advanced billings and unearned revenue on uncompleted contracts
|
|
|
443
|
|
|
|
519
|
|
|
Reserve for estimated losses on uncompleted contracts
|
|
|
53
|
|
|
|
76
|
|
|
Employee compensation and benefits
|
|
|
296
|
|
|
|
320
|
|
|
Other current liabilities
|
|
|
548
|
|
|
|
680
|
|
|
Current liabilities related to discontinued operations, net
|
|
|
4
|
|
|
|
7
|
|
|
Total current liabilities
|
|
|
2,571
|
|
|
|
3,043
|
|
|
Noncurrent employee compensation and benefits
|
|
|
439
|
|
|
|
403
|
|
|
Other noncurrent liabilities
|
|
|
183
|
|
|
|
333
|
|
|
Noncurrent income tax payable
|
|
|
44
|
|
|
|
34
|
|
|
Noncurrent deferred tax liability
|
|
|
66
|
|
|
|
37
|
|
|
Total liabilities
|
|
|
3,303
|
|
|
|
3,850
|
|
|
KBR shareholders’ equity:
|
|
|
|
|
|
|
|
|
|
Common stock
|
|
|
—
|
|
|
|
—
|
|
|
Paid-in capital in excess of par value
|
|
|
2,104
|
|
|
|
2,091
|
|
|
Accumulated other comprehensive loss
|
|
|
(421
|
)
|
|
|
(439
|
)
|
|
Retained earnings
|
|
|
797
|
|
|
|
596
|
|
|
Treasury stock
|
|
|
(221
|
)
|
|
|
(196
|
)
|
|
Total KBR shareholders’ equity
|
|
|
2,259
|
|
|
|
2,052
|
|
|
Noncontrolling interest
|
|
|
16
|
|
|
|
(18
|
)
|
|
Total shareholders’ equity
|
|
|
2,275
|
|
|
|
2,034
|
|
|
Total liabilities and shareholders’ equity
|
|
$
|
5,578
|
|
|
$
|
5,884
|
|
|
|
|
|
|
KBR, Inc.: Condensed Consolidated Statements of Cash Flows
|
|
(In millions) (Unaudited)
|
|
|
|
|
|
|
|
Nine Months Ended
|
|
|
|
September 30,
|
|
|
|
2009
|
|
2008
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
Net income
|
|
$
|
275
|
|
|
$
|
278
|
|
|
Adjustments to reconcile net income to net cash provided by (used
in) operations:
|
|
|
|
|
|
|
|
|
|
Depreciation and amortization
|
|
|
41
|
|
|
|
33
|
|
|
Equity earnings from unconsolidated affiliates
|
|
|
(46
|
)
|
|
|
(34
|
)
|
|
Deferred income taxes
|
|
|
(14
|
)
|
|
|
52
|
|
|
Impairment of goodwill
|
|
|
6
|
|
|
|
—
|
|
|
Other
|
|
|
10
|
|
|
|
(37
|
)
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
Receivables
|
|
|
(191
|
)
|
|
|
(119
|
)
|
|
Unbilled receivables on uncompleted contracts
|
|
|
94
|
|
|
|
73
|
|
|
Accounts payable
|
|
|
(233
|
)
|
|
|
(102
|
)
|
|
Advanced billings and unearned revenue on uncompleted contracts
|
|
|
(68
|
)
|
|
|
(212
|
)
|
|
Accrued employee compensation and benefits
|
|
|
(24
|
)
|
|
|
(2
|
)
|
|
Reserve for loss on uncompleted contracts
|
|
|
(23
|
)
|
|
|
(25
|
)
|
|
Collection of advances from unconsolidated affiliates, net
|
|
|
(1
|
)
|
|
|
69
|
|
|
Distribution of earnings from unconsolidated affiliates, net
|
|
|
35
|
|
|
|
88
|
|
|
Other assets
|
|
|
25
|
|
|
|
(89
|
)
|
|
Other liabilities
|
|
|
87
|
|
|
|
28
|
|
|
Total cash flows provided by (used in) operating activities
|
|
|
(27
|
)
|
|
|
1
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
Capital expenditures
|
|
|
(22
|
)
|
|
|
(27
|
)
|
|
Sales of property, plant, and equipment
|
|
|
—
|
|
|
|
6
|
|
|
Acquisition of businesses, net of cash acquired
|
|
|
—
|
|
|
|
(498
|
)
|
|
Other investing activities
|
|
|
2
|
|
|
|
—
|
|
|
Total cash flows used in investing activities
|
|
|
(20
|
)
|
|
|
(519
|
)
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
Payments to reacquire common stock
|
|
|
(27
|
)
|
|
|
(196
|
)
|
|
Net proceeds from issuance of common stock
|
|
|
1
|
|
|
|
3
|
|
|
Excess tax benefits from stock-based compensation
|
|
|
(1
|
)
|
|
|
2
|
|
|
Payments of dividends to shareholders
|
|
|
(24
|
)
|
|
|
(17
|
)
|
|
Distributions to noncontrolling shareholders, net
|
|
|
(30
|
)
|
|
|
(23
|
)
|
|
Other financing activities
|
|
|
(11
|
)
|
|
|
—
|
|
|
Total cash flows used in financing activities
|
|
|
(92
|
)
|
|
|
(231
|
)
|
|
Effect of exchange rate changes
|
|
|
14
|
|
|
|
(2
|
)
|
|
Decrease in cash and equivalents
|
|
|
(125
|
)
|
|
|
(751
|
)
|
|
Cash and equivalents at beginning of period
|
|
|
1,145
|
|
|
|
1,861
|
|
|
Cash and equivalents at end of period
|
|
$
|
1,020
|
|
|
$
|
1,110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
KBR, Inc.: Revenue and Operating Results by Business Unit
|
|
(In millions) (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
September 30,
|
|
June 30,
|
|
Revenue:
|
|
2009
|
|
2008
|
|
2009
|
|
G&I: U.S. Government – Middle East Operations
|
|
$
|
1,108
|
|
|
$
|
1,364
|
|
|
$
|
1,301
|
|
|
U.S. Government – Americas Operations
|
|
|
130
|
|
|
|
183
|
|
|
|
130
|
|
|
International Operations
|
|
|
138
|
|
|
|
212
|
|
|
|
136
|
|
|
Total G&I
|
|
|
1,376
|
|
|
|
1,759
|
|
|
|
1,567
|
|
|
Upstream:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gas Monetization
|
|
|
637
|
|
|
|
434
|
|
|
|
679
|
|
|
Oil & Gas
|
|
|
98
|
|
|
|
116
|
|
|
|
108
|
|
|
Total Upstream
|
|
|
735
|
|
|
|
550
|
|
|
|
787
|
|
|
Services
|
|
|
566
|
|
|
|
539
|
|
|
|
588
|
|
|
Downstream
|
|
|
123
|
|
|
|
138
|
|
|
|
124
|
|
|
Technology
|
|
|
27
|
|
|
|
19
|
|
|
|
23
|
|
|
Ventures
|
|
|
5
|
|
|
|
1
|
|
|
|
3
|
|
|
Other
|
|
|
8
|
|
|
|
12
|
|
|
|
9
|
|
|
Total revenue
|
|
$
|
2,840
|
|
|
$
|
3,018
|
|
|
$
|
3,101
|
|
|
Business unit income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
G&I: U.S. Government – Middle East Operations
|
|
$
|
71
|
|
|
$
|
78
|
|
|
$
|
60
|
|
|
U.S. Government – Americas Operations
|
|
|
19
|
|
|
|
13
|
|
|
|
14
|
|
|
International Operations
|
|
|
38
|
|
|
|
42
|
|
|
|
39
|
|
|
Total job income
|
|
|
128
|
|
|
|
133
|
|
|
|
113
|
|
|
Divisional overhead
|
|
|
(39
|
)
|
|
|
(29
|
)
|
|
|
(33
|
)
|
|
Total G&I business unit income
|
|
|
89
|
|
|
|
104
|
|
|
|
80
|
|
|
Upstream:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Gas Monetization
|
|
|
40
|
|
|
|
37
|
|
|
|
50
|
|
|
Oil & Gas
|
|
|
20
|
|
|
|
26
|
|
|
|
26
|
|
|
Total job income
|
|
|
60
|
|
|
|
63
|
|
|
|
76
|
|
|
Divisional overhead
|
|
|
(12
|
)
|
|
|
(10
|
)
|
|
|
(11
|
)
|
|
Total Upstream business unit income
|
|
|
48
|
|
|
|
53
|
|
|
|
65
|
|
|
Services:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Job income
|
|
|
56
|
|
|
|
41
|
|
|
|
49
|
|
|
Divisional overhead
|
|
|
(20
|
)
|
|
|
(14
|
)
|
|
|
(20
|
)
|
|
Total Services business unit income
|
|
|
36
|
|
|
|
27
|
|
|
|
29
|
|
|
Downstream:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Job income
|
|
|
16
|
|
|
|
20
|
|
|
|
20
|
|
|
Divisional overhead
|
|
|
(6
|
)
|
|
|
(5
|
)
|
|
|
(6
|
)
|
|
Total Downstream business unit income
|
|
|
10
|
|
|
|
15
|
|
|
|
14
|
|
|
Technology:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Job income
|
|
|
14
|
|
|
|
10
|
|
|
|
11
|
|
|
Divisional overhead
|
|
|
(7
|
)
|
|
|
(6
|
)
|
|
|
(6
|
)
|
|
Total Technology business unit income
|
|
|
7
|
|
|
|
4
|
|
|
|
5
|
|
|
Ventures:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Job income
|
|
|
5
|
|
|
|
1
|
|
|
|
2
|
|
|
Divisional overhead
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
|
(1
|
)
|
|
Total Ventures business unit income
|
|
|
4
|
|
|
|
—
|
|
|
|
1
|
|
|
Other:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Job Income
|
|
|
2
|
|
|
|
4
|
|
|
|
2
|
|
|
Impairment of goodwill
|
|
|
(6
|
)
|
|
|
—
|
|
|
|
—
|
|
|
Divisional overhead
|
|
|
(1
|
)
|
|
|
(3
|
)
|
|
|
(2
|
)
|
|
Total Other business unit income (loss)
|
|
|
(5
|
)
|
|
|
1
|
|
|
|
—
|
|
|
Total business unit income
|
|
$
|
189
|
|
|
$
|
204
|
|
|
$
|
194
|
|
|
|
|
|
|
KBR, Inc.: Revenue and Operating Results by Business Unit
|
|
(In millions) (Unaudited)
|
|
|
|
|
|
|
|
Nine Months Ended
|
|
|
|
September 30,
|
|
Revenue:
|
|
2009
|
|
2008
|
|
G&I: U.S. Government – Middle East Operations
|
|
$
|
3,866
|
|
|
$
|
4,072
|
|
|
U.S. Government – Americas Operations
|
|
|
389
|
|
|
|
460
|
|
|
International Operations
|
|
|
417
|
|
|
|
618
|
|
|
Total G&I
|
|
|
4,672
|
|
|
|
5,150
|
|
|
Upstream:
|
|
|
|
|
|
|
|
|
|
Gas Monetization
|
|
|
1,971
|
|
|
|
1,454
|
|
|
Oil & Gas
|
|
|
302
|
|
|
|
406
|
|
|
Total Upstream
|
|
|
2,273
|
|
|
|
1,860
|
|
|
Services
|
|
|
1,723
|
|
|
|
776
|
|
|
Downstream
|
|
|
360
|
|
|
|
339
|
|
|
Technology
|
|
|
70
|
|
|
|
61
|
|
|
Ventures
|
|
|
16
|
|
|
|
(3
|
)
|
|
Other
|
|
|
27
|
|
|
|
12
|
|
|
Total revenue
|
|
$
|
9,141
|
|
|
$
|
8,195
|
|
|
Business unit income (loss):
|
|
|
|
|
|
|
|
|
|
G&I: U.S. Government – Middle East Operations
|
|
$
|
193
|
|
|
$
|
183
|
|
|
U.S. Government – Americas Operations
|
|
|
49
|
|
|
|
27
|
|
|
International Operations
|
|
|
112
|
|
|
|
126
|
|
|
Total job income
|
|
|
354
|
|
|
|
336
|
|
|
Divisional overhead
|
|
|
(104
|
)
|
|
|
(89
|
)
|
|
Total G&I business unit income
|
|
|
250
|
|
|
|
247
|
|
|
Upstream:
|
|
|
|
|
|
|
|
|
|
Gas Monetization
|
|
|
155
|
|
|
|
110
|
|
|
Oil & Gas
|
|
|
64
|
|
|
|
122
|
|
|
Total job income
|
|
|
219
|
|
|
|
232
|
|
|
Divisional overhead
|
|
|
(33
|
)
|
|
|
(35
|
)
|
|
Total Upstream business unit income
|
|
|
186
|
|
|
|
197
|
|
|
Services:
|
|
|
|
|
|
|
|
|
|
Job income
|
|
|
149
|
|
|
|
76
|
|
|
Gain on sale of assets
|
|
|
—
|
|
|
|
1
|
|
|
Divisional overhead
|
|
|
(60
|
)
|
|
|
(20
|
)
|
|
Total Services business unit income
|
|
|
89
|
|
|
|
57
|
|
|
Downstream:
|
|
|
|
|
|
|
|
|
|
Job income
|
|
|
42
|
|
|
|
52
|
|
|
Divisional overhead
|
|
|
(18
|
)
|
|
|
(15
|
)
|
|
Total Downstream business unit income
|
|
|
24
|
|
|
|
37
|
|
|
Technology:
|
|
|
|
|
|
|
|
|
|
Job income
|
|
|
34
|
|
|
|
32
|
|
|
Divisional overhead
|
|
|
(19
|
)
|
|
|
(16
|
)
|
|
Total Technology business unit income
|
|
|
15
|
|
|
|
16
|
|
|
Ventures:
|
|
|
|
|
|
|
|
|
|
Job income (loss)
|
|
|
15
|
|
|
|
(3
|
)
|
|
Gain on sale of assets
|
|
|
2
|
|
|
|
1
|
|
|
Divisional overhead
|
|
|
(2
|
)
|
|
|
(2
|
)
|
|
Total Ventures business unit income (loss)
|
|
|
15
|
|
|
|
(4
|
)
|
|
Other:
|
|
|
|
|
|
|
|
|
|
Job Income
|
|
|
7
|
|
|
|
4
|
|
|
Impairment of goodwill
|
|
|
(6
|
)
|
|
|
—
|
|
|
Divisional overhead
|
|
|
(5
|
)
|
|
|
(3
|
)
|
|
Total Other business unit income (loss)
|
|
|
(4
|
)
|
|
|
1
|
|
|
Total Business unit income
|
|
$
|
575
|
|
|
$
|
551
|
|
|
|
|
|
|
|
|
|
|
KBR, Inc.: Backlog Information (a)
|
|
(In Millions) (Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
September 30,
|
|
June 30,
|
|
December 31,
|
|
|
|
2009
|
|
2009
|
|
2008
|
|
G&I:
|
|
|
|
|
|
|
|
|
|
|
U.S. Government – Middle East Operations
|
|
$
|
781
|
|
$
|
621
|
|
$
|
1,428
|
|
U.S. Government – Americas Operations
|
|
|
379
|
|
|
425
|
|
|
600
|
|
International Operations
|
|
|
1,390
|
|
|
1,494
|
|
|
1,446
|
|
Total G&I(b)
|
|
|
2,550
|
|
|
2,540
|
|
|
3,474
|
|
Upstream:
|
|
|
|
|
|
|
|
|
|
|
Gas Monetization
|
|
|
7,414
|
|
|
5,825
|
|
|
6,196
|
|
Oil & Gas
|
|
|
149
|
|
|
178
|
|
|
260
|
|
Total Upstream
|
|
|
7,563
|
|
|
6,003
|
|
|
6,456
|
|
Services
|
|
|
1,898
|
|
|
2,356
|
|
|
2,810
|
|
Downstream
|
|
|
624
|
|
|
605
|
|
|
578
|
|
Technology
|
|
|
140
|
|
|
138
|
|
|
130
|
|
Ventures
|
|
|
709
|
|
|
704
|
|
|
649
|
|
Total backlog for continuing operations
|
|
$
|
13,484
|
|
$
|
12,346
|
|
$
|
14,097
|
(a) Backlog is presented differently depending on if the contract is
consolidated by KBR or is accounted for under the equity method of
accounting. Backlog related to consolidated projects is presented as
100% of the expected revenue from the project. Backlog related to
projects accounted for under the equity method of accounting is
presented as KBR’s share of the expected future revenue from the
project. Our backlog for projects related to unconsolidated joint
ventures totaled $2.2 billion, $2.3 billion, and $2.4 billion at
September 30, 2009, June 30, 2009 and December 31, 2008, respectively.
Our backlog related to consolidated joint ventures with noncontrolling
interest totaled $4.8 billion, $3.0 billion, and $3.1 billion at
September 30, 2009, June 30, 2009 and December 31, 2008, respectively.
As of September 30, 2009, 18% of our backlog for continuing operations
was attributable to fixed-price contracts and 82% was attributable to
cost-reimbursable contracts. For contracts that contain both fixed-price
and cost-reimbursable components, we classify the components as either
fixed-price or cost-reimbursable according to the composition of the
contract except for smaller contracts where we characterize the entire
contract based on the predominate component.
(b) The Government and Infrastructure unit backlog attributable to firm
orders in the amount of $2.4 billion, $2.4 billion, and $3.3 billion as
of September 30, 2009, June 30, 2009 and December 31, 2008,
respectively. Government and Infrastructure business unit backlog
attributable to unfunded orders was $0.1 billion as of September 30,
2009, $0.1 billion as of June 30, 2009 and $0.2 billion as of December
31, 2008.
Source: KBR
KBR
Rob Kukla, Jr., 713-753-5082
Director, Investor Relations
or
Heather
Browne, 713-753-3775
Director, Communications
|
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