On Thursday, KBR, Inc. (NYSE:KBR) announced second-quarter earnings that slightly surpassed analyst expectations, while revenue came in below estimates. Following the announcement, the engineering and defense contractor’s shares dipped 1.1%, as investors reacted to a lowered full-year revenue outlook.
KBR reported adjusted earnings per share of $0.91 for Q2, narrowly beating the analyst consensus of $0.90. However, revenue totaled $1.95 billion, falling short of the $2.09 billion forecast, despite representing a 6% increase year-over-year.
The company substantially reduced its revenue guidance for the full year, now expecting between $7.9 billion and $8.1 billion, down from the previous range of $8.7 billion to $9.1 billion and below the analyst consensus of $8.62 billion. KBR attributed the revision to the termination of the HomeSafe Alliance joint venture contract, cutbacks in EUCOM and logistics operations, and delays related to protest resolutions.
“As we reflect on our solid financial performance this quarter, I am proud of our team’s unwavering dedication to delivering results that matter,” KBR’s management said. “Through disciplined cost management and operational excellence, we have achieved double-digit growth in both earnings and EPS, while expanding margins and maintaining robust cash flow.”
Adjusted EBITDA rose 12% to $242 million, with a margin improvement to 12.4% from 11.7% in the prior-year quarter. Operating cash flow from continuing operations climbed 38% to $217 million.
KBR’s Mission Technology Solutions segment saw revenues increase 7% to $1.41 billion, while the Sustainable Technology Solutions segment reported a 2% revenue rise to $540 million, maintaining a strong adjusted EBITDA margin of 23.9%.
During the quarter, the company returned $69 million to shareholders, comprising $48 million in share buybacks and $21 million in dividends. KBR kept its full-year adjusted EPS guidance steady at $3.78 to $3.88, aligning with the analyst consensus of $3.81.
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