1000 - Condensed Consolidated S
1000 - Condensed Consolidated Statements of Income (USD $) | ||||
In Millions | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Revenue | ||||
Services | $3,075 | $2,658 | $6,254 | $5,156 |
Equity in EarningsĀ of Unconsolidated Affiliates, Net | 26 | 0 | 47 | 21 |
Total Revenue | 3,101 | 2,658 | 6,301 | 5,177 |
Operating costs and expenses | ||||
Cost of Services | 2,910 | 2,518 | 5,919 | 4,827 |
General and Administrative | 54 | 52 | 103 | 108 |
Gain on Sale of Assets, Net | 0 | (2) | (2) | (2) |
Total operating costs and expenses | 2,964 | 2,568 | 6,020 | 4,933 |
Operating Income | 137 | 90 | 281 | 244 |
Interest Income, Net | 0 | 9 | 1 | 25 |
Foreign Currency Gains (Losses), Net | (4) | 1 | 1 | (2) |
Other non-operating expense | (1) | 0 | (1) | 0 |
Income before income taxes and noncontrolling interests | 132 | 100 | 282 | 267 |
Provision for Income Taxes | (49) | (36) | (104) | (96) |
Net income | 83 | 64 | 178 | 171 |
Less: Net income attributable to noncontrolling interests | (16) | (16) | (34) | (25) |
Net income attributable to KBR | $67 | $48 | $144 | $146 |
Net income attributable to KBR per share | ||||
Basic | 0.42 | 0.28 | 0.9 | 0.86 |
Diluted | 0.42 | 0.28 | 0.89 | 0.86 |
Basic weighted average common shares outstanding | 160 | 169 | 160 | 169 |
Diluted weighted average common shares outstanding | 161 | 171 | 161 | 170 |
Cash dividends declared per share | 0.05 | 0.05 | 0.1 | 0.1 |
2000 - Condensed Consolidated B
2000 - Condensed Consolidated Balance Sheets (USD $) | ||
In Millions | Jun. 30, 2009
| Dec. 31, 2008
|
Current assets | ||
Cash and equivalents | $1,077 | $1,145 |
Receivables | ||
Accounts receivable (less allowance for bad debts of $20 and $19) | 1,398 | 1,312 |
Unbilled receivables on uncompleted contracts | 751 | 835 |
Total receivables | 2,149 | 2,147 |
Deferred income taxes | 183 | 107 |
Other current assets | 530 | 743 |
Total current assets | 3,939 | 4,142 |
Property, plant, and equipment, net of accumulated depreciation of $248 and $224 | 245 | 245 |
Goodwill | 698 | 694 |
Intangible assets, net | 64 | 73 |
Equity in and advances to related companies | 215 | 185 |
Noncurrent deferred income taxes | 190 | 167 |
Unbilled receivables on uncompleted contracts | 134 | 134 |
Other assets | 162 | 244 |
Total assets | 5,647 | 5,884 |
Current liabilities | ||
Accounts payable | 1,272 | 1,387 |
Due to former parent, net | 54 | 54 |
Advance billings and unearned revenue on uncompleted contracts | 424 | 519 |
Reserve for estimated losses on uncompleted contracts | 61 | 76 |
Employee compensation and benefits | 324 | 320 |
Other current liabilities | 532 | 680 |
Current liabilities related to discontinued operations, net | 6 | 7 |
Total current liabilities | 2,673 | 3,043 |
Noncurrent employee compensation and benefits | 429 | 403 |
Other noncurrent liabilities | 235 | 333 |
Noncurrent income tax payable | 46 | 34 |
Noncurrent deferred tax liability | 64 | 37 |
Total liabilities | 3,447 | 3,850 |
KBR Shareholders' equity | ||
Preferred stock, $0.001 par value, 50,000,000 shares authorized, 0 shares issued and outstanding | 0 | 0 |
Common stock, $0.001 par value, 300,000,000 shares authorized, 170,307,802 and 170,125,715 shares issued, and 160,401,131 and 161,725,715 shares outstanding | 0 | 0 |
Paid-in capital in excess of par | 2,099 | 2,091 |
Accumulated other comprehensive loss | (428) | (439) |
Retained earnings | 732 | 596 |
Treasury stock, 9,906,671 shares and 8,400,000 shares, at cost | (217) | (196) |
Total KBR shareholders' equity | 2,186 | 2,052 |
Noncontrolling interests | 14 | (18) |
Total shareholders' equity | 2,200 | 2,034 |
Total liabilities and shareholders' equity | $5,647 | $5,884 |
2010 - Parenthetical Data to th
2010 - Parenthetical Data to the Condensed Consolidated Balance Sheets (USD $) | ||
In Millions, except Share data | Jun. 30, 2009
| Dec. 31, 2008
|
Receivables | ||
Allowance for Bad Debts | $20 | $19 |
Accumulated Depreciation | $248 | $224 |
KBR Shareholders' equity | ||
Preferred Stock, Par or Stated Value Per Share | 0.001 | 0.001 |
Preferred Stock, Shares Authorized | 50,000,000 | 50,000,000 |
Common Stock, Par or Stated Value Per Share | 0.001 | 0.001 |
Common Stock, Shares Authorized | 300,000,000 | 300,000,000 |
Common Stock, Shares, Issued | 170,307,802 | 170,125,715 |
Common Stock, Shares, Outstanding | 160,401,131 | 161,725,715 |
Treasury Stock, Shares | 9,906,671 | 8,400,000 |
3000 - Condensed Consolidated S
3000 - Condensed Consolidated Statements of Comprehensive Income (USD $) | ||||
In Millions | 3 Months Ended
Jun. 30, 2009 | 3 Months Ended
Jun. 30, 2008 | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Net income | $83 | $64 | $178 | $171 |
Other comprehensive income (loss), net of tax | ||||
Net cumulative translation adjustments | 14 | (1) | 10 | (2) |
Pension liability adjustment | 4 | 2 | 10 | 2 |
Net Unrealized Gain (Loss) on Investments and Derivatives | 1 | 1 | (2) | 1 |
Total other comprehensive income, net of tax | 19 | 2 | 18 | 1 |
Comprehensive income | 102 | 66 | 196 | 172 |
Less: Comprehensive income attributable to noncontrolling interests | (21) | (16) | (41) | (23) |
Comprehensive income attributable to KBR | $81 | $50 | $155 | $149 |
4000 - Condensed Consolidated S
4000 - Condensed Consolidated Statements of Cash Flows (USD $) | ||
In Millions | 6 Months Ended
Jun. 30, 2009 | 6 Months Ended
Jun. 30, 2008 |
Cash flows from operating activities | ||
Net income | $178 | $171 |
Adjustments to reconcile net income to net cash provided by operations | ||
Depreciation and amortization | 28 | 17 |
Equity in earnings of unconsolidated affiliates | (47) | (21) |
Deferred income taxes | (33) | 23 |
Other | 2 | (42) |
Changes in operating assets and liabilities | ||
Receivables | (65) | (234) |
Unbilled receivables on uncompleted contracts | 70 | 1 |
Accounts payable | (125) | 63 |
Advanced billings and unearned revenue on uncompleted contracts | (79) | (309) |
Accrued Employee Compensation and Benefits | 4 | (51) |
Reserve for loss on uncompleted contracts | (16) | (12) |
Collection of advances from unconsolidated affiliates, net | 3 | 57 |
Distribution of Earninngs from Unconsolidated Affiliates, net | 17 | 76 |
Other assets | (1) | (105) |
Other Liabilities | 56 | 82 |
Total Cash Flows Used in Operating Activities | (8) | (284) |
Cash flows from investing activities | ||
Capital Expenditures | (16) | (16) |
Acquisition of businesses, net of cash acquired | 0 | (11) |
Other Investing Activities | 3 | 3 |
Total Cash Flows Used in Investing Activities | (13) | (24) |
Cash flows from financing activities | ||
Payments to reacquire common stock | (21) | 0 |
Net Proceeds from Issuance of Stock | 0 | 2 |
Excess Tax Benefits from Stock-based Compensation | 0 | 2 |
Payments of Dividends to Shareholders | (16) | (9) |
Distributions to noncontrolling shareholders, net | (9) | (12) |
Other financing activities | (13) | 0 |
Total Cash Flows Used in Financing Activities | (59) | (17) |
Effect of Exchange Rate Changes on Cash | 12 | 20 |
Decrease in Cash and Equivalents | (68) | (305) |
Cash and equivalents at beginning of period | 1,145 | 1,861 |
Cash and equivalents at end of period | 1,077 | 1,556 |
Noncash operating activities | ||
Other assets (see Note 7) | 322 | 0 |
Other liabilities (see Note 7) | (322) | 0 |
Noncash financing activities | ||
Dividends declared or payable | $8 | $9 |
6000 - Description of Business
6000 - Description of Business and Basis of Presentation | |
6 Months Ended
Jun. 30, 2009 | |
Description of Business and Basis of Presentation | |
Nature of Operations [Text Block] | KBR, Inc. and its subsidiaries (collectively, KBR) is a global engineering, construction and services company supporting the energy, petrochemicals, government services, industrial and civil infrastructure sectors. We offer a wide range of services through six business units; Government and Infrastructure (GI), Upstream, Services, Downstream, Technology and Ventures. See Note 4 for financial information about our reportable business segments. The accompanying unaudited condensed consolidated financial statements have been prepared in accordance with the rules of the United States Securities and Exchange Commission (SEC) for interim financial statements and do not include all annual disclosures required by accounting principles generally accepted in the United States.These condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2008 filed with the SEC.We believe that the presentation and disclosures herein are adequate to make the information not misleading, and the condensed consolidated financial statements reflect all normal adjustments that management considers necessary for a fair presentation of our consolidated results of operations, financial position and cash flows.Operating results for interim periods are not necessarily indicative of results to be expected for the full fiscal year 2009 or any other future periods.We have evaluated subsequent events for potential recognition or disclosure in the financial statements through our Form 10-Q issuance date of July 30, 2009. The preparation of our condensed consolidated financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenue and costs during the reporting periods.Actual results could differ materially from those estimates.On an ongoing basis, we review our estimates based on information currently available, and changes in facts and circumstances may cause us to revise these estimates. Our condensed consolidated financial statements include the accounts of majority-owned, controlled subsidiaries and variable interest entities where we are the primary beneficiary.The equity method is used to account for investments in affiliates in which we have the ability to exert significant influence over the affiliates operating and financial policies.The cost method is used when we do not have the ability to exert significant influence.All material intercompany accounts and transactions are eliminated. Effective January 1, 2009, we adopted FASB Statement No. 160 Noncontrolling Interests in Consolidated Financial Statements (FAS 160).Noncontrolling interests in consolidated subsidiaries in our condensed consolidated balance sheets represent noncontrolling shareholders proportionate share of the equity in our consolidated subsidiaries.Noncontrolling interest in consolidated subsidiaries is adjusted each period to refl |
6010 - Income per Share
6010 - Income per Share | |
6 Months Ended
Jun. 30, 2009 | |
Income per Share | |
Earnings Per Share [Text Block] | Basic income per share is based upon the weighted average number of common shares outstanding during the period.Dilutive income per share includes additional common shares that would have been outstanding if potential common shares with a dilutive effect had been issued.A reconciliation of the number of shares used for the basic and diluted income per share calculations is as follows: Three Months Ended Six Months Ended June 30, June 30, Millions of shares 2009 2008 2009 2008 Basic weighted average common sharesoutstanding 160 169 160 169 Dilutive effect of: Stock options and restricted shares 1 2 1 1 Diluted weighted average common shares outstanding 161 171 161 170 No adjustments to net income were made in calculating diluted earnings per share for the three and six months ended June 30, 2009 and 2008.The diluted earnings per share calculation did not include 2.8 million and 2.6 million antidilutive weighted average shares for the three and six months ended June 30, 2009, respectively.The number of antidilutive weighted average shares was not material for the three and six months ended June 30, 2008. |
6020 - Percentage of Completion
6020 - Percentage of Completion Contracts | |
6 Months Ended
Jun. 30, 2009 | |
Percentage-of-Completion Contracts | |
Percentage of completion contracts [Text Block] | Unapproved claims The amounts of unapproved claims included in determining the profit or loss on contracts and the amounts recorded as Unbilled receivables on uncompleted contracts as of June 30, 2009 and December 31, 2008 are as follows: June 30, December 31, Millions of dollars 2009 2008 Probable unapproved claims $ 124 $ 133 Probable unapproved change orders 5 Probable unapproved claims related to unconsolidated subsidiaries 33 Probable unapproved change orders related to unconsolidated subsidiaries 2 5 As of June 30, 2009, the probable unapproved claims, including those from unconsolidated subsidiaries, primarily related to three completed contracts.See Note 6 for a discussion of United States government contract claims, which are not included in the table above. We have contracts with probable unapproved claims that will likely not be settled within one year totaling $120 million at June 30, 2009 and $130 million at December 31, 2008, respectively, included in the table above, which are reflected as a non-current asset in Unbilled receivables on uncompleted contracts on the condensed consolidated balance sheets. Other probable unapproved claims that we believe will be settled within one year have been recorded as a current asset in Unbilled receivables on uncompleted contracts on the condensed consolidated balance sheets. Escravos Project In July 2007, we and our joint venture partner modified the contract terms and conditions converting the project from a fixed-price to a reimbursable contract whereby we will be paid our actual cost incurred less a credit that approximates the charge we identified in the second quarter of 2006.The unamortized balance of the charge is included as a component of the Reserve for estimated losses on uncompleted contracts in the accompanying condensed consolidated balance sheets. Skopje Embassy Project In 2005, we were awarded a fixed-price contract to design and build a U.S. embassy in Skopje, Macedonia.We recorded losses of $21 million in 2008, bringing our total losses to $60 million.On March 31, 2009 we received notice of substantial completion from our customer which ended our exposure to liquidated damages.The customer took control of the facility on April 27, 2009.We have not incurred any further losses since 2008.Although we do not expect to incur additional losses on this project, it is possible that additional losses could be incurred if we exceed the amounts currently estimated for warranty type items. PEMEX Arbitration In 1997 and 1998 we entered into three contracts with PEMEX, the project owner, to build offshore platforms, pipelines and related structures in the Bay of Campeche offshore Mexico.The three contracts were known as Engineering, Procurement and Construction (EPC) 1, EPC 22 and EPC 28, respectively.All three projects encountered significant schedule delays and increased costs due to problems with design work, late delivery and defects in equipment, increases in scope and other changes.PEMEX took possession of the offshore facilities of EPC 1 in March 2004 after having achiev |
6030 - Business Segment Informa
6030 - Business Segment Information | |
6 Months Ended
Jun. 30, 2009 | |
Business Segment Information | |
Segment Reporting Disclosure [Text Block] | We provide a wide range of services, but the management of our business is heavily focused on major projects within each of our reportable segments.At any given time, a relatively few number of projects and joint ventures represent a substantial part of our operations. Intersegment revenues are immaterial.Our equity in earnings and losses of unconsolidated affiliates that are accounted for using the equity method of accounting is included in revenue of the applicable segment. The table below presents information on our business segments. Three Months Ended Six Months Ended June 30, June 30, Millions of dollars 2009 2008 2009 2008 Revenue: Government and Infrastructure $ 1,567 $ 1,707 $ 3,296 $ 3,391 Upstream 787 699 1,538 1,310 Services 588 129 1,157 237 Other 159 123 310 239 Total revenue $ 3,101 $ 2,658 $ 6,301 $ 5,177 Operating segment income: Government and Infrastructure $ 80 $ 63 $ 161 $ 143 Upstream 65 39 138 144 Services 29 17 53 30 Other 20 21 34 30 Operating segment income (a) $ 194 $ 140 $ 386 $ 347 Unallocated amounts: Labor cost absorption (b) (3 ) 2 (2 ) 5 Corporate general and administrative (54 ) (52 ) (103 ) (108 ) Total operating income $ 137 $ 90 $ 281 $ 244 ______________________ (a) Operating segment performance is evaluated by our chief operating decision maker using operating segment income which is defined as operating segment revenue less the cost of services and segment overhead directly attributable to the operating segment.Operating segment income excludes certain cost of services directly attributable to the operating segment that is managed and reported at the corporate level, and corporate general and administrative expenses.We believe this is the most accurate measure of the ongoing profitability of our operating segments. (b) Labor cost absorption represents costs incurred by our central service labor and resource groups (above)/under the amounts charged to the operating segments. |
6040 - Committed and Restricted
6040 - Committed and Restricted Cash | |
6 Months Ended
Jun. 30, 2009 | |
Committed and Restricted Cash | |
Committed and Restricted Cash | Cash and equivalents include cash from advanced payments related to contracts in progress held by our joint ventures that we consolidate for accounting purposes.The use of these cash balances is limited to joint venture activities and is not available for other projects, general cash needs, or distribution to us without approval of the board of directors of the respective joint ventures.Cash from advanced payments held by our joint ventures that we consolidate for accounting purposes totaled approximately $225 million at June 30, 2009 and $175 million at December 31, 2008.Cash and equivalents also includes $96 million at June 30, 2009 and $179 at December 31, 2008, of cash from advance payments that are not available for other projects related to a contract in progress that is not executed through a joint venture. Included in Other current assets and Other assets at June 30, 2009 is restricted cash in the amounts of $3 million and $12 million, respectively.Restricted cash consists of amounts held in deposit with certain banks to collateralize standby letters of credit. |
6050 - United States Government
6050 - United States Government Contract Work | |
6 Months Ended
Jun. 30, 2009 | |
United States Government Contract Work | |
Commitments and Contingencies Disclosure - Government contracts [Text Block] | We provide substantial work under our government contracts to the United States Department of Defense and other governmental agencies. These contracts include our worldwide United States Army logistics contracts, known as LogCAP and U.S. Army Europe (USAREUR). Given the demands of working in Iraq and elsewhere for the United States government, we expect that from time to time we will have disagreements or experience performance issues with the various government customers for which we work. If performance issues arise under any of our government contracts, the government retains the right to pursue remedies, which could include threatened termination or termination, under any affected contract. If any contract were so terminated, we may not receive award fees under the affected contract, and our ability to secure future contracts could be adversely affected, although we would receive payment for amounts owed for our allowable costs under cost-reimbursable contracts. Other remedies that could be sought by our government customers for any improper activities or performance issues include sanctions such as forfeiture of profits, suspension of payments, fines, and suspensions or debarment from doing business with the government.Further, the negative publicity that could arise from disagreements with our customers or sanctions as a result thereof could have an adverse effect on our reputation in the industry, reduce our ability to compete for new contracts, and may also have a material adverse effect on our business, financial condition, results of operations, and cash flow. We have experienced and expect to be a party to various claims against us by employees, third parties, soldiers, subcontractors and others that have arisen out of our work in Iraq such as claims for wrongful termination, assaults against employees, personal injury claims by third parties and army personnel, and subcontractor claims. While we believe we conduct our operations safely, the environments in which we operate often lead to these types of claims. We believe the vast majority of these types of claims are governed by the Defense Base Act or precluded by other defenses. We have a dispute resolution program under which most of these employee claims are subject to binding arbitration. However, an unfavorable resolution or disposition of these matters could have a material adverse effect on our business, results of operations, financial condition and cash flow. Award fees In accordance with the provisions of the LogCAP III contract, we earn profits on our services rendered based on a combination of a fixed fee plus award fees granted by our customer. Both fees are measured as a percentage rate applied to estimated and negotiated costs.The LogCAP III customer is contractually obligated to periodically convene Award Fee Evaluation Boards to determine the amount of award fees to be granted to us. Award fees are based on evaluations of our performance using criteria set forth in the contract, which include non-binding monthly evaluations made by our customers in the field of operations. Although the criteria have historically been used by the Award Fee Evaluation |
6060 - Other Commitments and Co
6060 - Other Commitments and Contingencies | |
6 Months Ended
Jun. 30, 2009 | |
Other Commitments and Contingencies | |
Commitments and Contingencies Disclosure [Text Block] | Foreign Corrupt Practices Act investigations On February 11, 2009 KBR LLC, entered a guilty plea related to the Bonny Island investigation in the United States District Court, Southern District of Texas, Houston Division (the Court).KBR LLC plead guilty to one count of conspiring to violate the FCPA and four counts of violating the FCPA, all arising from the intent to bribe various Nigerian officials through commissions paid to agents working on behalf of TSKJ on the Bonny Island project.The plea agreement reached with the DOJ resolves all criminal charges in the DOJs investigation into the conduct of KBR LLC relating to the Bonny Island project, so long as the conduct was disclosed or known to DOJ before the settlement, including previously disclosed allegations of coordinated bidding below. The plea agreement calls for the payment of a criminal penalty of $402 million, of which Halliburton will pay $382 million under the terms of the indemnity in the master separation agreement, while we will pay $20 million.The criminal penalties will be paid in quarterly payments over the next two years.We also agreed to a period of organizational probation of three years, during which we will retain a monitor who will assess our compliance with the plea agreement and evaluate our FCPA compliance program over the three year period, with periodic reports to the DOJ. On the same date, the SEC filed a complaint and we consented to the filing of a final judgment against us in the Court. The complaint and the judgment were filed as part of a settled civil enforcement action by the SEC, to resolve the civil portion of the governments investigation of the Bonny Island project. The complaint alleges civil violations of the FCPAs antibribery and books and records provisions related to the Bonny Island project. The complaint enjoins us from violating the FCPAs antibribery, books-and-records, and internal-controls provisions and requires Halliburton and KBR, jointly and severally, to make payments totaling $177 million, all of which has been paid by Halliburton pursuant to the indemnification under the master separation agreement.The judgment also requires us to retain an independent monitor on the same terms as the plea agreement with the DOJ. Under both the plea agreement and judgment, we have agreed to cooperate with the SEC and DOJ in their investigations of other parties involved in TSKJ and the Bonny Island project. As a result of the settlement, in the fourth quarter 2008 we recorded the $402 million obligation to the DOJ and, accordingly, recorded a receivable from Halliburton for the $382 million that Halliburton will pay to the DOJ on our behalf.The resulting charge of $20 million to KBR was recorded in cost of sales of our Upstream business unit in the fourth quarter of 2008. Likewise, we recorded an obligation to the SEC in the amount of $177 million and a receivable from Halliburton in the same amount.Halliburton paid their first three installments totaling $145 million to the DOJ and $177 million to the SEC in the first half of 2009. At June 30, 2009, the remaining obligation to the DOJ of $252 million has been classified on our conso |
6070 - Income Taxes
6070 - Income Taxes | |
6 Months Ended
Jun. 30, 2009 | |
Income Taxes | |
Income Taxes [Text Block] | Our effective tax rate for the three and six months ended June 30, 2009 was approximately 37%.Our effective tax rate for both the three and six months ended June 30, 2008 was approximately 36%.Our effective tax rate for the three and six months of 2009 was higher than our statutory rate of 35% primarily due to discrete items charged to income tax expense from the true-up of prior year foreign and domestic taxes. Our effective tax rate for the three and six months of 2008 exceeded our statutory rate of 35% primarily due to non-deductible operating losses from our railroad investment in Australia, and state and other taxes. |
6080 - Shareholders' Equity
6080 - Shareholders' Equity | |
6 Months Ended
Jun. 30, 2009 | |
Shareholders' Equity | |
Stockholders' Equity Note Disclosure [Text Block] | The following tables summarize our shareholders equity activities for the first six months of 2009: KBR Shareholders Millions of dollars Total Paid-in Capital in Excess of par Retained Earnings Treasury Stock Accumulated Other Comprehensive Loss Noncontrolling Interests Balance at December 31, 2008 $ 2,034 $ 2,091 $ 596 (196 ) $ (439 ) $ (18 ) Stock-based compensation 8 8 Dividends declared to shareholders (8 ) (8 ) Repurchases of common stock (21 ) (21 ) Distributions to noncontrolling interests (21 ) (21 ) Investments by noncontrolling interests 12 12 Comprehensive income: Net income 178 144 34 Other comprehensive income, net of tax (provision): Net cumulative translation adjustment 10 6 4 Pension liability adjustment, net of tax 10 7 3 Net unrealized gains (losses) on derivatives (2 ) (2 ) Total 196 Balance at June 30, 2009 $ 2,200 $ 2,099 $ 732 $ (217 ) $ (428 ) $ 14 The following tables summarize our shareholders equity activity for the first six months of 2008: KBR Shareholders Millions of dollars Total Paid-in Capital in Excess of par Retained Earnings Treasury Stock Accumulated Other Comprehensive Loss Noncontrolling Interests Balance at December 31, 2007 $ 2,235 $ 2,070 $ 319 $ (122 ) $ (32 ) Opening balance sheet adjustment (a) 2 2 FAS 158 remeasurement date (1 ) (1 ) Stock-based compensation 8 8 Common stock issued upon exercise of stock options 2 2 Tax benefit related to stock-based plans 2 2 Dividends declared to shareholders (18 ) (18 ) Distributions to noncontrolling interests (8 ) (8 ) Comprehensive income: Net income 171 146 25 Other comprehensive income, net of tax (provision): Net cumulative translation adjustment (2 ) (2 ) Pension liability adjustment, 2 4 (2 ) Net unrealized gains (losses) on derivatives 1 1 Total 172 Balance at June 30, 2008 $ 2,394 $ 2,082 $ 446 $ $ (117 ) $ (17 ) _______________________ (a) The opening balance sheet adjustment to accumulated other comprehensive loss was a charge of $2 million, net of tax as of January 1, 2008, as a result of the measurement date requirements of SFAS No. 158, Employers Accounting for Defined Benefit Pension and Other Postretirement Plans. Accumulated other comprehensive loss consisted of the following balances: June 30, |
6090 - Fair Value Measurements
6090 - Fair Value Measurements | |
6 Months Ended
Jun. 30, 2009 | |
Fair Value Measurements | |
Fair Value Disclosures [Text Block] | The financial assets and liabilities measured at fair value on a recurring basis are included below: Fair Value Measurements at Reporting Date Using Millions of dollars June 30, 2009 Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Marketable securities $ 16 $ 12 $ 4 $ Derivative assets $ 5 $ $ 5 $ Derivative liabilities $ 8 $ $ 8 $ We manage our currency exposures through the use of foreign currency derivative instruments denominated in our major currencies, which are generally the currencies of the countries for which we do the majority of our international business. We utilize derivative instruments to manage the foreign currency exposures related to specific assets and liabilities that are denominated in foreign currencies, and to manage forecasted cash flows denominated in foreign currencies generally related to long-term engineering and construction projects. The purpose of our foreign currency risk management activities is to protect us from the risk that the eventual dollar cash flow resulting from the sale and purchase of products and services in foreign currencies will be adversely affected by changes in exchange rates. The currency derivative instruments are carried on the condensed consolidated balance sheet at fair value and are based upon market observable inputs. |
6100 - Equity Method Investment
6100 - Equity Method Investments and Variable Interest Entities | |
6 Months Ended
Jun. 30, 2009 | |
Equity Method Investments and Variable Interest Entities | |
Equity method investments and variable interest entities [Text Block] | We conduct some of our operations through joint ventures which are in partnership, corporate, undivided interest and other business forms and are principally accounted for using the equity method of accounting. Brown Root Condor Spa (BRC). BRC was a joint venture in which we sold our 49% interest and other rights in BRC in the third quarter of 2007 to Sonatrach for approximately $24 million, resulting in a pre-tax gain of approximately $18 million.As of June 30, 2009, we have not collected the outstanding amount of $18 million due from Sonatrach for the sale of our interest in BRC, which is included in Accounts receivable. In the fourth quarter of 2008, we filed for arbitration in an attempt to force collection and we will take other actions, as deemed necessary, to collect the outstanding amounts. Roads project.During the first quarter of 2008, we acquired an additional 8% interest in a joint venture related to one of our privately financed projects to design, build, operate, and maintain roadways for certain government agencies in the United Kingdom.The additional interest was purchased from an existing shareholder for approximately $8 million in cash.As of March 31, 2008, we owned a 33% interest in the joint venture.The joint venture is considered a variable interest entity; however, we are not the primary beneficiary.We continue to account for this investment using the equity method of accounting.In the second quarter of 2008, we sold the additional 8% interest in the joint venture to an unrelated party for approximately $9 million, leaving us with a 25% interest in the joint venture.In the first quarter of 2009, we negotiated and settled with the purchaser an additional $2 million in sales proceeds which was contingent upon certain tax rulings in the United Kingdom.The additional sales proceeds were recorded as Gain on sale of assets. Variable Interest Entities The FASB issued FASB Interpretation No.46, Consolidation of Variable Interest Entities, an Interpretation of ARB No.51 (FIN 46), in January 2003. In December 2003, the FASB issued FIN 46R, a revision which supersedes the original interpretation. We adopted FIN 46R effective January1, 2004. FIN 46R requires the consolidation of entities in which a company absorbs a majority of another entitys expected losses, receives a majority of the other entitys expected residual returns, or both, as a result of ownership, contractual, or other financial interests in the other entity. Previously, entities were generally consolidated based upon a controlling financial interest through ownership of a majority voting interest in the entity.In December 2008, the FASB issued FSP FIN46 R-8, Interest in Variable Interest Entities, which requires expanded information about an enterprises involvement with a variable interest entity. We assess all newly created entities and those with which we become involved to determine whether such entities are variable interest entities and, if so, whether or not we are the primary beneficiary of such entities.Most of the entities we assess are incorporated or unincorporated joint ventures formed by us and our partner(s) for the purpose of executin |
6110 - Retirement Plans
6110 - Retirement Plans | |
6 Months Ended
Jun. 30, 2009 | |
Retirement Plans | |
Pension and Other Postretirement Benefits Disclosure [Text Block] | The components of net periodic benefit cost related to pension benefits for the three and six months ended June 30, 2009 and 2008 were as follows: Three Months Ended June 30, 2009 2008 Millions of dollars United States International United States International Components of net periodic benefit cost: Service cost $ $ $ $ 2 Interest cost 1 19 1 25 Expected return on plan assets (1 ) (19 ) (1 ) (28 ) Amortization of net loss 1 3 3 Curtailment Net periodic benefit cost $ 1 $ 3 $ $ 2 Six Months Ended June 30, 2009 2008 Millions of dollars United States International United States International Components of net periodic benefit cost: Service cost $ $ 2 $ $ 4 Interest cost 2 37 2 50 Expected return on plan assets (2 ) (40 ) (2 ) (56 ) Amortization of net loss 1 6 6 Curtailment (4 ) Net periodic benefit cost (benefit) $ 1 $ 1 $ $ 4 As of June 30, 2009, we contributed $8 million of the $11 million we currently expect to contribute in 2009 to our international plans.As of June 30, 2009, we contributed $5 million of the $11 million we currently expect to contribute to our domestic plans in 2009.The assets held by the trustee of the plans sustained significant declines in market value during 2008, the effects of which are accounted for as a component of accumulated other comprehensive loss our Condensed Consolidated Balance Sheets and our Shareholders Equity footnote (See Note 9).If the market values of assets remain depressed, our levels of contribution could be impacted in future years. In March 2009, we amended the terms and conditions of one of our international pension plans and ceased future service and benefit accruals for all plan participants.This action meets the definition of a curtailment under FASB Statement No. 88 and resulted in a curtailment gain of approximately $4 million during the first quarter of 2009. The components of net periodic benefit cost related to other postretirement benefits were immaterial for the three and six months ended June 30, 2009 and 2008. |
6120 - Transactions with Former
6120 - Transactions with Former Parent and Other Related Party Transactions | |
6 Months Ended
Jun. 30, 2009 | |
Transactions with Former Parent and Other Related Party Transactions | |
Related Party Transactions Disclosure [Text Block] | Our balance payable to Halliburton of $54 million at June 30, 2009 and December 31, 2008, was comprised of amounts owed to Halliburton primarily for estimated outstanding income taxes under the tax sharing agreement. We perform many of our projects through incorporated and unincorporated joint ventures.In addition to participating as a joint venture partner, we often provide engineering, procurement, construction, operations or maintenance services to the joint venture as a subcontractor.Where we provide services to a joint venture that we control and therefore consolidate for financial reporting purposes, we eliminate intercompany revenues and expenses on such transactions.In situations where we account for our interest in the joint venture under the equity method of accounting, we do not eliminate any portion of our revenues or expenses.We recognize the profit on our services provided to joint ventures that we consolidate and joint ventures that we record under the equity method of accounting primarily using the percentage-of-completion method.Total revenues from services provided to our unconsolidated joint ventures recorded in our consolidated statements of income were $27 million and $62 million for the three months ended June30, 2009 and 2008, respectively and revenues of $80 million and $115 million for the six months ended June 30, 2009 and 2008, respectively.Income or loss from services provided to our unconsolidated joint ventures was a loss of $2 million and income of $10 million for the three months ended June 30, 2009 and 2008, respectively and a loss of $8 million and income of $18 million for the six months ended June 30, 2009, and 2008, respectively. |
6130 - New Accounting Standards
6130 - New Accounting Standards | |
6 Months Ended
Jun. 30, 2009 | |
New Accounting Standards | |
Schedule of New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | In March 2008, the FASB issued FSP SFAS 132R-1, Employers Disclosure about Postretirement Benefit Plan Assets which amends SFAS 132 Employers Disclosures about Pensions and Other Postretirement Benefits.This Statement was developed in response to concerns expressed by users of financial statements about their need for more information about pension plan assets, obligations, benefit payments, contributions, and net benefit cost.The FSP is intended to provide users of employers financial statements with more informative disclosures about the nature and valuation of postretirement benefit plan assets.The disclosures about plan assets are effective for fiscal years ending after December 15, 2009. Effective January 1, 2009, we adopted FASB Staff Position (FSP) Emerging Issues Task Force (EITF) 03-6-1, Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities (FSP EITF 03-6-1).FSP EITF 03-6-1 provides that unvested share-based payment awards that contain rights to non-forfeitable dividends or dividend equivalents (whether paid or unpaid) participate in undistributed earnings with common shareholders.Certain KBR restricted stock units and restricted stock awards are considered participating securities since the share-based awards contain a non-forfeitable right to dividends irrespective of whether the awards ultimately vest.FSP EITF 03-6-1 requires that the two-class method of computing basic EPS be applied.Under the two-class method, KBR stock options are not considered to be participating securities.There was no impact of significance on basic or diluted EPS for the three and six months ended June 30, 2009 and 2008 as a result of the adoption of FSP EITF 03-6-1. In April 2009, the FASB issued FSP FAS 107-1 and APB 28-1, Interim Disclosures about Fair Value of Financial Instruments. This FSP amends FASB Statement No. 107, Disclosures about Fair Value of Financial Instruments, to require disclosures about fair value of financial instruments for interim reporting periods of publicly traded companies as well as in annual financial statements. This FSP also amends APB Opinion No. 28, Interim Financial Reporting, to require those disclosures in summarized financial information at interim reporting periods. This FSP shall be effective for interim reporting periods ending after June 15, 2009. The adoption of this statement did not have a significant impact to our financial position, results of operations or cash flows. In April 2009, the FASB issued FSP FAS 115-2 and FAS 124-2, Recognition and Presentation of Other-Than-Temporary Impairments. This FSP amends the other-than-temporary impairment guidance in U.S. GAAP for debt securities to make the guidance more operational and to improve the presentation and disclosure of other-than-temporary impairments on debt and equity securities in the financial statements. This FSP does not amend existing recognition and measurement guidance related to other-than-temporary impairments of equity securities. This FSP shall be effective for interim and annual reporting periods ending after June 15, 2009. The adoption of this statement did not have a significant |
Document Information
Document Information | |
6 Months Ended
Jun. 30, 2009 | |
Document Information [Line Items] | |
Document Type | 10-Q |
Amendment Flag | false |
Document Period End Date | 2009-06-30 |
Entity Information
Entity Information (USD $) | |||
6 Months Ended
Jun. 30, 2009 | Jul. 24, 2009
| Jun. 30, 2008
| |
Entity Information [Line Items] | |||
Entity Registrant Name | KBR, Inc. | ||
Entity Central Index Key | 0001357615 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Public Float | $5,423,000,000 | ||
Entity Common Stock, Shares Outstanding | 160,409,258 |