Exhibit 99.1
CB&I Reports Third Quarter 2006 Results
Revenue Increases 55%; Backlog Tops $4 Billion
THE WOODLANDS, Texas--(BUSINESS WIRE)--Nov. 8, 2006--CB&I
(NYSE:CBI) today reported net income of $32.4 million or $0.33 per
diluted share for the third quarter ended Sept. 30, 2006, compared
with a net loss of $31.9 million or $0.33 per diluted share for the
comparable period in 2005.
"Backlog for the Company is performing well, and combined with
very strong results in new orders for the quarter, we maintain our
confidence in achieving the level of results expected by our
shareholders," said Philip K. Asherman, CB&I's President and CEO.
"This confidence is shared by our major stakeholders including
customers, as evidenced by solid third quarter awards including the $1
billion Golden Pass LNG regasification terminal project in Texas; the
financial community, which recently supported a substantial increase
in our credit facility; and our employee base, which has increased to
nearly 12,000 personnel worldwide. Our end markets in LNG, refining,
gas processing, storage tanks and the other major energy segments we
serve are growing rapidly around the world, as producers continue to
invest in the infrastructure needed to meet increasing global demand."
Highlights of the Company's third quarter 2006 results include:
FINANCIAL HIGHLIGHTS
(in thousands, except per share data)
Three Months Nine Months
Ended Sept. 30, Ended Sept. 30,
2006 2005 2006 2005
New awards $1,947,329 $681,935 $3,456,583 $2,638,781
Backlog 4,416,512 3,268,899 4,416,512 3,268,899
Revenue 860,983 555,337 2,251,766 1,582,895
Net income (loss) $32,432 $(31,880) $78,386 $(1,185)
Net income (loss) per
share $0.33 $(0.33) $0.79 $(0.01)
-- New Awards - New awards for the quarter were $1.95 billion,
compared with $681.9 million in the third quarter of 2005. Significant
awards during the quarter included the Golden Pass LNG terminal in the
United States, an LNG expansion project in Australia, and two hydrogen
plants in the U.S. Backlog at Sept. 30, 2006, increased to $4.42
billion.
-- Revenue - Revenue increased 55% to $861.0 million from $555.3
million in the third quarter of 2005. Geographically, 51% of total
revenue for the quarter was derived in North America. Revenue
increased 28% in North America due mainly to a larger volume of both
process-related and storage work in the United States. Revenue in the
Europe, Africa, Middle East segment increased 165% due primarily to
progress on LNG work in the United Kingdom.
-- Cash and Cash Equivalents - The Company ended the quarter with
cash and cash equivalents of $630.4 million, compared with $334.0
million at Dec. 31, 2005.
CB&I is raising its full-year 2006 guidance for earnings, revenue
and new awards. The Company anticipates that earnings per share will
be in the range of $1.06 - $1.11, with revenue of $3.0 - $3.2 billion
and new awards of $4.0 - $4.3 billion.
Any statements made in this release that are not based on
historical fact are forward-looking statements and represent
management's best judgment as to what may occur in the future. The
actual outcome and results are not guaranteed, are subject to risks,
uncertainties and assumptions, and may differ materially from those
expressed or implied by any forward-looking statements. A variety of
factors could cause business conditions and results to differ
materially from what is contained in the forward-looking statements
including, but not limited to, the Company's ability to realize cost
savings from its expected performance of contracts; the uncertain
timing and funding of new contract awards, and project cancellations
and operating risks; cost overruns on fixed price, target price or
similar contracts; risks associated with percentage-of-completion
accounting; the Company's ability to settle or negotiate unapproved
change orders and claims; changes in the costs or availability of, or
delivery schedule for, components, materials, labor or subcontractors;
weather conditions that may affect performance and timeliness of
completion, which could lead to increased costs and adversely affect
the costs or availability of, or delivery schedule for, components,
materials, labor or subcontractors; increased competition; fluctuating
revenue resulting from a number of factors, including the cyclical
nature of the individual markets in which the Company's customers
operate; lower than expected activity in the hydrocarbon industry,
demand from which is the largest component of the Company's revenue;
lower than expected growth in the Company's primary end markets,
including but not limited to LNG and clean fuels; risks inherent in
the Company's acquisition strategy and its ability to obtain financing
for proposed acquisitions; the Company's ability to integrate and
successfully operate acquired businesses and the risks associated with
those businesses; adverse outcomes of pending claims or litigation or
the possibility of new claims or litigation, including but not limited
to pending securities class action litigation, and the potential
effect on the Company's business, financial condition and results of
operations; the ultimate outcome or effect of the pending Federal
Trade Commission order on the Company's business, financial condition
and results of operations; two previously identified material
weaknesses in the Company's internal control over financial reporting
that could adversely affect the Company's ability to report its
financial condition and results of operations accurately and on a
timely basis; lack of necessary liquidity to finance expenditures
prior to the receipt of payment for the performance of contracts and
to provide bid and performance bonds and letters of credit securing
the Company's obligations under its bids and contracts; proposed and
actual revisions to U.S. and non-U.S. tax laws, and interpretation of
said laws, and U.S. tax treaties with non-U.S. countries (including
The Netherlands), that seek to increase income taxes payable;
political and economic conditions including, but not limited to, war,
conflict or civil or economic unrest in countries in which the Company
operates; and a downturn or disruption in the economy in general.
Additional factors which could cause actual results to differ
materially from such forward-looking statements are described under
"Risk Factors" as set forth in the Company's Form 10-K filed with the
SEC for the year ended Dec. 31, 2005. The Company does not undertake
to update any forward-looking statements contained herein, whether as
a result of new information, future events or otherwise.
ABOUT CB&I
CB&I executes on average more than 700 projects each year and is
one of the world's leading engineering, procurement and construction
(EPC) companies, specializing in projects for customers that produce,
process, store and distribute the world's natural resources. With more
than 60 locations and approximately 12,000 employees throughout the
world, CB&I capitalizes on its global expertise and local knowledge to
safely and reliably deliver projects virtually anywhere. Information
about CB&I is available at www.CBI.com.
CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
Three Months Nine Months
Ended Sept. 30, Ended Sept. 30,
2006 2005 2006 2005
Revenue $860,983 $555,337 $2,251,766 $1,582,895
Cost of revenue 784,639 569,032 2,042,504 1,493,573
------- ------- --------- ---------
Gross profit (loss) 76,344 (13,695) 209,262 89,322
% of Revenue 8.9% (2.5%) 9.3% 5.6%
Selling and
administrative
expenses 34,136 22,739 102,618 76,518
% of Revenue 4.0% 4.1% 4.6% 4.8%
Intangibles
amortization 133 385 1,444 1,157
Other operating
loss (income), net 175 (601) (259) (2,334)
------- ------- --------- ---------
Income (loss) from
operations 41,900 (36,218) 105,459 13,981
% of Revenue 4.9% (6.5%) 4.7% 0.9%
Interest expense (1,269) (1,781) (5,982) (6,694)
Interest income 5,717 1,589 12,705 4,393
------- ------- --------- ---------
Income (loss)
before taxes and
minority interest 46,348 (36,410) 112,182 11,680
Income tax (expense)
benefit (11,953) 5,870 (29,728) (10,251)
------- ------- --------- ---------
Income (loss) before
minority interest 34,395 (30,540) 82,454 1,429
Minority interest in
income (1,963) (1,340) (4,068) (2,614)
------- ------- --------- ---------
Net income (loss) $ 32,432 $(31,880) $ 78,386 $ (1,185)
======= ======= ========= =========
Net income (loss)
per share
Basic $ 0.34 $ (0.33) $ 0.81 $ (0.01)
Diluted $ 0.33 $ (0.33) $ 0.79 $ (0.01)
Weighted average shares
outstanding
Basic 96,581 97,754 97,059 97,496
Diluted 98,325 97,754 98,849 97,496
CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES
SEGMENT INFORMATION
(in thousands)
Three Months Ended
Sept. 30, Sept. 30,
2006 2005
NEW AWARDS(a) % of % of
Total Total
North America $1,378,001 71% $ 368,152 54%
Europe/Africa/Middle East 304,088 16% 193,276 28%
Asia Pacific 237,892 12% 68,869 10%
Central & South America 27,348 1% 51,638 8%
------- -------
Total $1,947,329 $ 681,935
======= =======
Three Months Ended
Sept. 30, Sept. 30,
2006 2005
REVENUE % of % of
Total Total
North America $ 436,225 51% $ 340,127 61%
Europe/Africa/Middle East 341,568 40% 129,055 23%
Asia Pacific 53,021 6% 64,902 12%
Central & South America 30,169 3% 21,253 4%
------- -------
Total $ 860,983 $ 555,337
======= =======
INCOME (LOSS) FROM OPERATIONS % of % of
Revenue Revenue
North America $ 22,980 5.3% $ (17,059) (5.0%)
Europe/Africa/Middle East 14,689 4.3% (26,024) (20.2%)
Asia Pacific 4,210 7.9% 4,324 6.7%
Central & South America 21 0.1% 2,541 12.0%
------- -------
Total $ 41,900 4.9% $ (36,218) (6.5%)
======= =======
Nine Months Ended
Sept. 30, Sept. 30,
2006 2005
NEW AWARDS(a) % of % of
Total Total
North America $2,429,669 70% $1,147,675 44%
Europe/Africa/Middle East 620,054 18% 1,110,771 42%
Asia Pacific 307,302 9% 263,611 10%
Central & South America 99,558 3% 116,724 4%
--------- ---------
Total $3,456,583 $2,638,781
========= =========
Nine Months Ended
Sept. 30, Sept. 30,
2006 2005
REVENUE % of % of
Total Total
North America $1,201,932 53% $1,000,327 63%
Europe/Africa/Middle East 801,257 36% 370,874 23%
Asia Pacific 162,353 7% 153,817 10%
Central & South America 86,224 4% 57,877 4%
--------- ---------
Total $2,251,766 $1,582,895
========= =========
INCOME (LOSS) FROM OPERATIONS % of % of
Revenue Revenue
North America $ 47,343 3.9% $ 23,617 2.4%
Europe/Africa/Middle East 43,795 5.5% (22,074) (6.0%)
Asia Pacific 10,518 6.5% 7,050 4.6%
Central & South America 3,803 4.4% 5,388 9.3%
--------- ---------
Total $ 105,459 4.7% $ 13,981 0.9%
========= =========
(a) New awards represent the value of new project commitments
received by the Company during a given period. These
commitments are included in backlog until work is performed and
revenue is recognized or until cancellation. Backlog may also
fluctuate with currency movements.
CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
Sept. 30, Dec. 31,
2006 2005
ASSETS
Current assets $1,362,636 $ 950,603
Property and equipment, net 180,168 137,718
Goodwill and other intangibles, net 256,031 257,991
Other non-current assets 37,708 31,507
--------- ---------
Total assets $1,836,543 $1,377,819
========= =========
LIABILITIES, REDEEMABLE COMMON
STOCK AND SHAREHOLDERS' EQUITY
Current liabilities $1,173,332 $ 758,643
Long-term debt -- 25,000
Other non-current liabilities 117,517 110,508
Redeemable common stock 38,107 --
Shareholders' equity 507,587 483,668
--------- ---------
Total liabilities, redeemable
common stock and shareholders'
equity $1,836,543 $1,377,819
========= =========
CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
AND OTHER FINANCIAL DATA
(in thousands)
Nine Months
Ended Sept. 30,
2006 2005
CASH FLOWS
Cash flows from operating activities $ 414,554 $ 49,880
Cash flows from investing activities (58,424) (24,034)
Cash flows from financing activities (59,734) (34,659)
------- -------
Increase/(decrease) in cash and
cash equivalents 296,396 (8,813)
Cash and cash equivalents,
beginning of the year 333,990 236,390
------- -------
Cash and cash equivalents,
end of the period $ 630,386 $ 227,577
======= =======
OTHER FINANCIAL DATA
Depreciation and amortization expense $ 20,245 $ 13,340
Capital expenditures $ 60,690 $ 26,066
Increase in receivables, net $(130,339) $(115,252)
Decrease in contracts in progress,
net 304,365 100,772
Increase in non-current
contract retentions (7,466) (1,789)
Increase in accounts payable 130,224 24,489
------- -------
Change $ 296,784 $ 8,220
======= =======
CONTACT: CB&I, The Woodlands
Media: Bruce Steimle, +1 832 513 1111
or
Analysts: Marty Spake, +1 832 513 1245