KBR - Earnings call transcript Q2 2024

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Operator

Good morning, everyone. Welcome to KBR's Second Quarter 2024 Earnings Conference Call. My name is Kiki, and I will be your conference operator today. [Operator Instructions] I will now hand you over to your host, Jamie DuBray, Vice President of Investor Relations to begin. Jamie, please go ahead.

Jamie DuBray

you. Thank welcome Quarter and Call. XXXX KBR's to morning, Fiscal Second Earnings Good

Chief and company X. involve me and in This the Sopp, these These forward-looking on as performance available and views President Stuart is most uncertainties Slide potential from quarter for Executive results Officer. kbr.com. discussion Executive also President Joining discussed the Brady, as well XX-K matters and website. Chief our that forward-looking includes actual could our then cause statements, This significantly are recent call highlights and presentation the differ to outlined Form risks will end Mark on about measures provide GAAP to Officer; open presentation. our as investors. Vice measures financial metrics Financial for these the the from Stuart events reconciliation section their nearest available as KBR's and to the future non-GAAP your at on questions. Today's useful of of Investors that impact A discussion statements included on earnings our at be reflecting of non-GAAP earnings website is believes measure includes Mark

turn to Stuart. call will the I now over

Stuart Bradie

our on earnings second welcome I will presentation. start Thanks, and Jamie, Slide to X. quarter

of day. they company, and many, an within can that As We other puts to sense I its have they where a strive people each you've people feel course, whole to the to heard is belonging work bring say selves KBR can many strong every environment a first. me connected times, company that of ensure their grow our

and and regularly the levels the company. survey is, into really feeling our The people representation we also how KBR are helps avoid into a increased our over right XX% complacency. or survey Now important, focusing feedback about we employees delivering date, in as results year, continual in bring we in fact, as we're us This new to do test sense, part for XX%, actually improvement, which solid And actually see we which we participation we're feel ensures areas are the being it particularly the are KBR. of any anonymous. and a to people gives people is new a entities of that broader highest

is I'm place share and pleased countries, over you been work, with feel and friends. KBR great to heard is we've team perspective, would KBR to as work and dear. our themselves a members to value inclusion of I a very, XX a hold that an great are feel that to very From XX% indeed place this recommend in they can much be certified XX% they very

there. So good performance

people a Obviously, our comes not you to a our we perfect, that in people, when feel but and gives good hopefully, to out talk it the walk are shout big fact. we this

So discuss a quarter let's on move to little. the Slide X and

is similar to with was the performing a QX metrics. or clean So at expectations key quarter above businesses across all the first quarter

], but with X% see, was cash at group bps. Year-to-date EBITDA XXX%. XX%, X-X% margins importantly, adjusted up revenue can you As was XX up year-on-year terrific the [ up the level, was a more adverse

this So which in confidence from guidance, Mark us strong following will moment. raise gives a to a on cover QX,

and people But in to short, our thus continue deliver. KBR,

with And both important at circa geopolitically. work booked We X.Xx, have continued also the takeaway, really adjusting trailing this an contract politically project group sit volatility, XX%, level a $X and for was basis the which On we represents XX-month at considering substantially especially strong side, currently under increased volume of bid awards [ large awaiting XXXX. group LNG was X-X% And billion quarter. on the ] growth X.X. a for decision, business is book-to-bill and our and this after

X. Slide to on Now

The And STS. and good for you a green project at performance on project XX-month the large lead X.X the and can below, X basis. so quarter, tenth start in on book-to-bill I a it's to trailing first projects, with in as more we'll ammonia awards market LNG value-add there that our for and with after area to continue overall. adjusting see the it's Firstly, continue the we prominent affordability highlighted differentiation critical from India the this yield. reflects transition, the due drive Blue enables of delivering to And ammonia, for contract a improve KBR. to continues however, key solutions and really ensure OCI we think It's energy efficiency this. and is be that by

ammonia that ammonia. in investment final plant Bomen, are In fact, globes technology produce X blue X only the actually and the world first FID-ed to using Both will These KBR's are KBR's OCI Texas the decision. in blue projects in which make UAE, process the proprietary there's have actually technology.

addition very, and East at develop I very to future in we strong demonstrates which excited conversations. development by very the very, We're Day and our very Investor position ensures industry much help ammonia award that our plans across a believe infrastructure, highlighted in this in is development. government a part of early this, about position. sustainable So strong their the we energy of are X-year the green Middle to as awarded, licenses the Iraqi position contract also in measured

to cybersecurity vehicle a a MAC in additional mobilization with in enable sits alone, program we required. to that B-XX the contract in at X wins the quarter, award for submitted our On trend And slide this scope X.Xx a significantly in the program be a under years, again of and solid. award X area over IDIQ we've highlighted the pick if response a quite Awards recompete the under awaiting at that substantial for MAC hunt highlighted in X.Xx We've rapid the do value QX which on that had effectively the actually bids in both side, had multiple up to on contract also as IAC win large area. we've bit volume billion XX-month increased and of $X basis and worth continued performance. award trailing expect to and at quarter license the book-to-bill government to terrific

is with a always progress contract task ongoing Defense MQS-X we these in report positive, coming Agency. months. on the orders is as we'll under the And notably, vehicles to new which move customer, Now Health

As at we highlighted sits at bids business of overall Day, $X Investor portfolio across government our and billion. in whole the XXXX increased in that volume significantly currently and over has

to give Mark, I will the performance. now on over Mark? will more detail financial who hand

Mark Sopp

I'll Fantastic. Hello, Stuart. pick up everyone. Slide Thanks, X. on

our line margins growth double-digit registering really performance, year over bump all and XXX%, cash QX pleased flow So adjusted strong our full as conversion that already leading healthy follows growth, year-to-date heard, profit EPS up top guide. you've and an with we're a strong just of to in QX,

equally This cash delivery came important pays world a in progress low and covered. is demonstration business enterprise and key results. contributing year-to-date consistently contribution venture about year-over-year the projects enabler discipline. good on combination to of times driving good missions around million Slide and segments. I Operating also superb quarter excellent Revenues as the delivering flow were margins a our profit . Of XX% client to And performance this of and just day-to-day critically results Sustainable engagement. to efficient adjusted with strong and intensity for project the On details client cash a dividends and said business number structure. seen with XX.X%, growth, that As EBITDA continued lower the grew we and for of of before, survey margins XX our to Margins mix, note, result. reflects to DSOs performance at the on highly that overall Tech particular engagements million, to $XXX intellectual double-digit XX.X%. has capital for in continued respect million cost license last financial up on cost from was people parts across the Stuart retention for flow hundreds $XXX model. $XXX our of of clients foundation the property recurring year is generation. all We've joint a employee deliver

X%, again, saw growth and and where we and International Defense overall, and X% a goes grew space revenue X% respectively. in government science XX%, up For Intelligence

activity sustainment trickling eCom related delays a conflict. year still through offset readiness the This is funding are for earlier in Ukraine in in the and contraction part to by as down particularly

the this to reverse beginning and Ukraine this is Sustainment in sequential to pretty in line attributed However, much XX.X% [indiscernible] expectations segment QX. as much margins X% pretty with growth hit QX for GS was in Profit up from area.

at flow capital enabled still year-to-date starts deployment finished quarter the Good cash was reduced good adjusted earlier, which X.Xx buybacks with QX. Slide XX This terrific as yet on which EBITDA. also quarter and for this discussed generation, trailing Now leverage, higher our to XX.

$XXX in about to dividends QX to have of Together increased $XX QX, in in million bumped Specifically, top cash our through buybacks we half. up QX. almost returned in on we million first $XXX the million with shareholders the

let how plan of briefly acquisition LINQUEST. Now the me to cover finance we

revolver have current liquidity. purchase While commenced maximize cash we capacity to we of process to term tapping additional full the price, cover and have our the loans

that, also as to the debt to new down the expect better we at do delevering generated structure be flows rates we Assuming any any have debt. the road. new option allow existing we repayments, debt so We'll for our are than cash same or of

at net post give leverage closing. leverage the still transaction X.Xx, pro is options. expect still buybacks reduction And capital debt We This take, M&A, a comfortable optionality and across level. our forma deployment ratio to we thus, have raise to or approximately

guidance. Now on to Slide XX, forward

is We are for our profit on driven. cash organically year the raising metrics, which and guidance all

contribution closes. factor in We not any from are expected it will not Linquest and until

to at in to We on then $X.X is will the year billion. at that depending and billion unchanged closing guidance materiality Revenue consider time. point an $X.X occurs when update the

with a midpoint performance, $XXX operating a million. million with we of adjusted However, to $XXX range are first bumping up to EBITDA $XXX a of million strong half

cash midpoint guidance to $XXX to million. with Our adjusted to guidance $X.XX finally, flow of to cash with $X.XX. a a $X.XX also year-to-date And we're adjusted operating flow EPS our strong million increasing $XXX is conversion, increasing

outlook testament flow is the STS and the to summary, business GS performance teams. and a cash well, increasing for we are of operating certainly really In great production, core profit our performing and the

the In addition, we're of truly LINQUEST. excited about addition

we expect really high we confidence really home well come. will In business and robust to customer synergy a align this years have delivery cultures and time The an be benefits for employees. for and their fact, for long I've excellent known

our this us exciting to of get on just really colleagues can't started wait All with front. new

With Stuart. back to that,

Stuart Bradie

to Terrific of only how I then points, since feedback integration. has the how so on the we're and would touch announced Mark. on cover I and as thinking XX week, last What a about slide would thought and same you the see announcement been we the as was is couple job, I talk our and Thanks, published really in to always, Slide LINQUEST. on about acquisition

So chassis I air do LinQuest, Air really and so X,XXX-plus amazing security are they And do dominance space, so work. think X think force, interoperability Force people, and or there they national across that connected think and battle space, digital. future space

think I double really is with we've opportunities, mean on their little overlap, will to gives at slide profile. complementary pre-synergy how fact I highly We're exciting are which those excited work synergy is also margins the the and growth digit KBR's as capability there. the highlighted that and

said our the there's So week, hall we incredibly terrific. we LinQuest business many people of think perspective, on people a a We last Mark with and located with and a that them other, absolutely on posted respect earlier, And from town positive, worked both a the LinQuest excitement. positive know is know in sides. lot each announcement numerous absolutely fact, has on feedback team the been And first very locations. of importantly, we're which well, as I unique. same occasions, is in and

We from have fit. this commitment common terrific I perspective, values, And to we as mission. really, we a culture really have a see think

feeling really on done LinQuest In deal. for the good those this operates already And before, of platforms. that actually it. really is terms a same of big about integration, many have we're ERP that

the on the reduces risk the greatly and burden doing integration. the this teams importantly, So

family. KBR an sure acquisition I'm coming we're and to bang and about the next a overlap, update focused the process, but delivering in on working earnings tell, excited that's synergies super in the through only So is revenue on close little come LinQuest great call. our hopefully, we'll we'll HSR and very Obviously, not This absolutely fit strategy with soon and can be you well-funded critical markets. you we'll more end on and weeks, joining

to with Slide and key on some XX, takeaways. Now I'll finish

and full key to cash Firstly, flow. on we've raise really Mark first half a year a across are pleased delivered result, as strong presented, performance we metrics guidance all 'XX profit as and

explained Secondly, the awards continued bookings submitted and and today very, as we our is work under high contract bids for and levels, at at very ensure awaiting XXXX XX%, momentum also earlier.

about I and growth and said double-digit as cool really, LinQuest, earlier, are bag strategy, on excited Thirdly, we margins it, super business. is really double-digit

our Investor customers deep and KBR technical at us we all into areas vision in domain adding where really markets Day, technology-enabled Lastly, allow across digital to differentiate to emphasized our while move high-end our world. for value continually the expertise critical

process will at both which as reduce manage these we to segments Saudi, realize be markets. on with one greater The and drive this believe likely allow as following business better AUKUS day, from should realign we Day. realignment catalyst, and to our we presented things IR on and efficiency. opportunities to complexity, even it's synergies globally our business and like Now capabilities optimization, Investor there And LinQuest of objective will operate are a standardization based to

this the on 'XX. through we'll with update expectation the report This we'll be work to working continue remainder on very much lines this will and for as to year Now the these we segments enterprise intact going and up, an along of and realignment. targets in remainder we're the XXXX you XXXX full remain a of make clear, to year, is heads through be And this to the progress. through

tuned. stay So please

Thank again for open back and hand the you questions. the call listening, I'll now operator, to will who for up

Operator

first from is [Operator Instructions] from Truist question The received Tobey company. Sommer we

Tobey Sommer

on on in some you expand what and if achieve so Stuart, the that think color, offer more will realignment wondering was bit I far? last could you that

Stuart Bradie

at full-on government sits will as across the where project will we've which GSI. Saudi Saudi basis, complexity One going given currently its will That it units what you example, of be customer business Yes. as project, sustainable Arabia. I'll our Thanks, move given the management in base, Saudi from objective commercial a move sort been position in leverage that DuriaGate new of effectively our contractual And X to, a in said, management could and The that bits Toby. forward. I reduce good into -- X give is is to program of broader realize and describing city project segment given its and scale vision STS to a with

carbon the do managing nuclear big GSI, much decommissioning sustainable the They another example So are decommissioning piece would we work sits footprint, Very be of very project quite obviously, nuclear also. STS a tricky and in of Sellafield currently the that a within arena. much a very programmatic bailiwick chain. in reducing managing significant supply

So that's sort get bigger. across we'll will thing the of pushing STS be

as the As given said, one change. guide a that I consequence, we've

we Investor advantage required. that margins out through But will Does expect at Day. as obviously standardization allows certainly we the X acumen in us, laid where and objective up give realize make it's sense? hold to well is I synergies think as and as more the we the we guess, in commercial go it So clear that But STS X, an overhead to I go to from this.

Tobey Sommer

I geographic over may sneak next most From perspective, in do Absolutely. you the the rapid follow-up. growth see or a year If where enterprise the X? across a

Stuart Bradie

that -- it's I think I that in in a you're going a the particularly increase if to this I lot in Middle particular. at mean you've as we you'll East. documents in of I East, look Middle think, the we described what in for see see think And in activity growth seen quarter, Gold our -- in South, ultimately, the you --

see that going significant be do activity. to an energy of perspective, So from area I the

the the also. side, U.S. on I emphasis lot also, of continued we of activity LinQuist see Pacific. obviously, think, in acquisition, obviously terms But in government happening a In the with the

So AUKUS we increasing things the activity do see things like and sharing allied across across forces. and intelligence data

in So on multi I and Tobey. which think you're going it to see depending places business,

Operator

on from The Dudas comes of line next question the Michael VetoResearch.

Michael Dudas

service you some in highlighted backlog pipeline. and what's Stuart, Mark. side STS relative Stuart bit the the to you opportunities. are have? targets least visibility comfortable in could XXXX, on growth pipeline, that you achieve at the on how you looking you at and share near-term to And Maybe a government today the Jamie, talked bookings little about

Stuart Bradie

Yes.

I STS X.X I excluding the project at mean, LNG think in were [ ]. as we the bookings the presented, quarter,

there's So strong there. momentum

on sitting to that's basis, think XX-month similar quarter, at I last trailing X.X actually, a ]. and [

Middle So good a in globally. bookings East. earlier, pipeline I continued STS, But really activity in a strong the said think as of lot I

In with fact, Jay. week I was last in Saudi

their in there. continued so confidence profiles And investment

probably not we're energy as seeing energy much talked transition, agenda the before we've well as energy the just affordability little X very questions, slowdown in that arena security So same. energy a slower very due much security all a still about demand on to the because at in decarbonized but in the is as the bit is brings way to and moving energy transition which more

to So change that, in what real Mike. around really Day we yes, no presented Investor

Michael Dudas

is follow-up the early shake out? things U.K. and any may new in read government how the on My

Stuart Bradie

question. the bit sort The election July quicker has Xth. on X, in -- jurisdictions It elected few than happened place process. good and cabinet I of moves in a weeks. by The this July mean, new was Yes, a U.K. the in some government

So a do back with in in parliaments like U.K. in of is defense in NATO far course, most have think and defense week. last ministers will it's very we've seen places, Zelinsky working. engaged -- the the it's what Ukraine in but fully happening is there'll to process, and the so with already whether in But is They foreign very, a areas. was U.K. back. and as new supporting committed other that government in I holiday what's be August, review there fact, go operational governments, all always or

terms to think commitment there. their to slowdown any don't transition. energy, we in so see actually even new And commitment more committed of labor is in And energy I

as we good So that opportunity see forward. . a going

Operator

Subin Stifel. is question The next from from Bert

Bert Subin

going the look kick a bit It business I the mean really book-to-bill the back growth than as was EBITDA at of step was some you like growth in to know be second continues expected, I sales be. Maybe and to off. business, this robust. what strong better a is Plaquemines just direction the starts quite for there's questions STS. around quarter to to

expect then second So beyond, the could the just like program, what you rates in mean, 'XX out sort give liquid you think big as to the of seeing And growth 'XX, you Aramco. us 'XX, highlighted persist. we're commentary on some to kind hear maybe Do of from half? you're you chemicals waiting to I the still Middle and East

there's if update curious any Just there.

Stuart Bradie

mean that very then a That's could some I around. that, that clear guidance the by still STS monitorium do much growth and and for we your first can was guide is or and rates movement robust, think Bert, I arms we well I get are as in to Day Investor Yes. we really, think we're at statement guidance the and think there. we're that but we bit there our short, year, in well. committed standing upped seeing really LNG very 'XX achieve I this you performing the probably I industry them. mean, guide, post our on our obviously, the

will November, I progressive move day again. market released. and that have until think think And that some start projects to in think election will I been I be

think, around same that's cetera. Middle So new And I same Middle the in I same Kuwait around the more covered than at Oman. in And is Saudi LTC it's ammonia, Investor pretty gas off that commitments and with the more is East, just It's in commitments in the et just and upbeat of the and the Day UAE. development we're feeling terms East about than that. LTC

you happening are client permission there's but aware have markets. well I think very that those present know be I liberty much program. we're and that So area, across and very we we able good and is kind yet not been all really of well forthcoming. lots from that friendly stating, until still anything anything to disclose very get we at but not in appreciate on for as as announce LTC, we the customer, have be it yet been to we about to and We are feel

pretty that's but apologize, that can I we're now. feeling we're I best the sit. I'd So say good about again, we right where do

Bert Subin

helpful. super That's

house as side in Just on follow-up a the other GS. the of

changes talked SMS. about in what up substantial like that. had a Could help you starting I and it what us bids, like and on pretty based growth think you in D&I in to sounds segments X% understand by said, you're Mark see maybe You what, ramp X% just the --

days how you've you those can targets ramp into some maybe do just RNS, So us at then given Day? on early color the And up Investor give [indiscernible]? regarding of

Stuart Bradie

Yes.

the $XX for in target billion I think So -- GS. circa year our big this is

think ] I achieved date. we've billion to [ $X

how could coming we was we see those and that of Investor all [ IAC-MAC. the a and in We've So into IDIQ drives quality expect, pipeline, achieve alone, done obviously think, project and targets. positioned thought got October machine, more that how BD put described path centralized very And we got we're volumes just is but very now manifest cycle group and I and volume, targets, this achieve how really are group strategically our more that and significant. still I our I guess, is terrific. that of a much award And -- itself. how of a And earlier, Day, we of billion we in we'll I in do part on guess, hopefully, government. in that that ensure as seeing acquisitive awaiting we've We've to we're awards more aligned of that, strong I areas competitive. between X But program other rates we've costs is which oversees parcel through absolutely And well through we've the into big guess, to obviously, centralized -- what because ] part our QX. refined effort big ramp-up more some

just work strategy And action what to and doing is and that. to got just actually think So deliver. strategy for and also your outcomes, I I teams achieve think our showing you've are you're

probably that. that's best the So way to put

Bert Subin

start just I in And think maybe so that's how far? April, progressing the so Homesafe Okay. just spoke at there then starting, on

Stuart Bradie

moves very, The well. the Yes. terrific. I gone on been early have very mean and service quality the the feedback have

are low. can you quite volumes the imagine, As

over we're that. all So

you would expect it. So

but -- so that good of We've next lined the so So we've far, got the achieve about got while. in terms we're to what in up thinking in little what chain sense. supply

no there. So issues

statements, for came ramping we're In so out that we'll fall With view we terms program, right a of our full busy progressively public be with moves doing TRANSCOM domestic which in that testing in and as season XXXX. is May and systems be of that in we'll far, at basically moves, particularly look the the the interstate now, aligned so good. said up,

we but targets but the and we that all a today. a to Day it's gave of program, are can that at obviously, bit doing Now expectation, line that achieve we're than . that we that's Investor up rightfully sit more so new kind conservative behind and where

Operator

next question Davidson. Brent from D.A. The from Thielman is

Brent Thielman

of can about into RNS. year outlook? the particularly, embedded Europe your for as Stuart, I expectations Mark talk the your in second what's activities your you're just moving or guess, and in you And half

Stuart Bradie

in mean what's actually Yes. can I'll jump there start quite is its activity and I RNS levels. interesting happening in in. Mark

some if movement sequential for you coming some of And behind a from at activities. the seeing there us. of are in sequential down growth So RNS of slowed growth, look you CR. it approved non-LOGCAP bit time the a we're bit know, and being the not NuCom. them Ukraine much Both But as in actually with actually, is supplemental

set which expect base QX the outlook. based because in actually support through a a is and come of eCom really and operational on do impact [indiscernible] So terrific business, we fact broader our QX

think on quite interesting say to more an So there. I Mark, that? dynamic any that's

Mark Sopp

No, you think said I it.

is diversified might think I think. RNS more one than

expanded reach pick little see. they've the very was we active, as down and the the much their doing are did they're [ been by year, toward included talked in did in so up some XX% we their say about markets slow On it will they've end. trickle a mills really ] this And that well. bids upping Ukraine, I and QX,

optimistic than that then we're a second half the And we'll as dictates better first. just the play term. the be longer So little bit will government

Stuart Bradie

they think ever, additive Yes.And a protest as resolved of do you we'll recent the hopefully, on favor, into these bids you that, protest. our then won couple And obviously we've go in QX, will we be you if told update have Alex. and got that we but in

feeling pretty about whole business performance. So we're and . R&S that good

Brent Thielman

it. Got

Stuart, around here of U.S., And is answer to to the previous one some targets Okay. what related in the of in of versus the just then, into your in opportunities the embedded to opportunity be talking what guess U.S.? your some XXXX in I particular, sort questions, the LNG here waiting. might opportunities especially the financial of STS for

Stuart Bradie

Middle LNG, reason talked about the in enough [ East answer is do ] out that where there's management we not mean in XX really XX and believe the we question. to we're Middle doing we numbers we've I We do about and Yes. and and [ -- work Dhabi, the as our ] broader in just the put we've and the to in are in East activities the Abu U.S. around in demand. talked project well globally

chance markets U.S. really, We are LNG. strong in we not enough think thinking also that positioning in But broader, are in absolutely on the a them. those markets XXXX I'm up getting LNG you going does what's but on LNG bit, as that. model, And not plastic about projects ahead? of dependent factor achieve What's know, we're targets. to the in a holistically the we our targets think pick our So the dependent chances are will run

the in at fair So we if there stand there's share, opportunity win of opportunity a there. But is win that's I we think LNG, those And great. I mix to think end whole day, can -- enough the we of our . behind targets.

Operator

The Fisher is Steven from next UBS. from question

Steven Fisher

the guidance to more I'm that restraining to you to in maybe drove if see outlook was the I'm then in us the I'm the guidance that more it change? that anything was between up old the And EPS on new had guidance bridge just curious Or first curious be captures curious, increase? to on was that increase, came there know of contingency it if new was guidance. business that blended the the guidance could any half kind and Nice headwinds there that wins? increase. and EBITDA

Stuart Bradie

out. -- absolutely full stop. increase guidance driven Steve, by No. mean and continue delivered day operational was to times, and perform. they day people the they're I've in the terrific, I in performance, many said our it

really, operational that performance really strong the guide. So drove

of terms In in guess, quite increase outlook, we're the U.S. times gave, modest an we nonetheless, volatile in enter I increase but and to about guidance, our

backlog but outside, that's why see we're quite volatility elections before As we've how you we'll both and a all and doing really and perhaps can what's basis sensible see noise little land and been and in of the how looming terms performing the imagine, much after where some U.S. in of the so. been probably impacts guided in with and then we prudent bit then so And we've And in has QX. the course, also, in up what we we'll of of this and prudent raised.

Steven Fisher

be upon benefits that it $XX called be that It rate hard EBITDA for EBITDA in year, And time you to helpful. related but next That's the based guess, on And seems around trying there growth that the like XXXX, in million a Or you're immediately multiple XXXX. then tell relative back what's to to it's some to XX% to to accretive rate I you $XX is implying going of out, it. little close? accretive? in will into take growth embedding plus LinQuest Okay. the to the tax million you're implied then cited that

Stuart Bradie

Yes. vehicles The into growth going got is think the the double at that we've in low that. And we 'XX through diligence, that while they've to looked and and backlog achieve know synergies. excludes digits. we contract

And as we or those that. yes, good growth we -- we're the this business. from about deal So feeling I we owners, would cash X on think think quite for I hope process. And accretive a Manus with that I -- very accretion, And as yes, well, I performances. anything that had very and in team said, Dearborn. it a sensible didn't And We they has like X And think were the a something KBR it's of the paid really basis. day good you expect, certainly, with with a margin had recognize that. of management multiple gone discussion sensible get for we terms through fever was

about good . real feeling we're So it.

Operator

Mora of America. The Mariana next Bank question is from from Perez

Samantha Stiroh

Mariana. This is on Samantha Stiroh for

at GS you the volume So increasing substantially. bids mentioned is of that

So of if for been a of kind wider makes bids, types volume scope address work, work? the greater KBR type of it new of a Or to of maybe like those is same sense. able seeing have you that

Stuart Bradie

does. it Yes,

human similar think things and I those there as present of lot a I in performance in that penetrated port like involved guess, do of we we're led and bit think seeing got markets. and obviously today. now we it's we the pieces contract, got we're differentiation strategically certainly presented are that through we into we've of are both. performance and work activity seeing, We But obviously forward of there. a ever customers because then initially we're as we think new NASA great health and I

historically. the scrutiny of obviously we've credentials opportunity seen think obviously, it's both. but really I a world stand there. seeing market that's again, that far cyber I And So our driven, We're bit more digital think up than to in

and our after. going continually are our that's -- we're aligning it's we and of . I be bit move But new type the new market based forever and differentiated vision, and on to on do both. technologies our and those bids So think capabilities, a we're up

Operator

Kaplowitz is Citigroup. next Andy from The from question

Andrew Kaplowitz

understanding But you're here bullish But just other type energy on what obviously, over a with GS. more be transition seeing in STS. clear, offset this slower? or on like next security offset few elaborate you're the energy to transition are peps of LNG, burn, transition if you Plaquemines still you STS than could said. it quarters to still and think that It backlog And from could STS projects little maybe that works energy sounds that projects you as could security. be grow Stuart, energy will the from do

Stuart Bradie

Yes.

start in just the to So general, market on there.

you the developing growing it's is and more more see demand global as energy the and that. developed, nations growing significantly, South, the can particularly So in -- that's become and

but away. there presented is market think affordability I in a believed faster, that are dynamic whole prepared that but around they versus my going growing, not Energy are transition remarks. bit molecules projects So blue, still grow of green the would I issues, and particularly say,

to has transition seeing to decarbonized are we meet a security faster demand, in way. growing, energy energy grow albeit but So

were things fuel So chemicals, opportunities. projects, liquid of that type your gas sort transition hydrocarbons earlier, traditional the I monetization, LNG mentioned all think programs like

renewable et As electric drives really of forefront. It's carbon I them or say, blue. using sort cetera, at more with or to power make the sequestration,

market by cetera. from is met was Shell I today. and that's CEO you're of Exxon, And last and Savik, that week. heading the when the certainly, majors there the I met So CEO think like the echoed I hearing Aramco last echoed by it week, and was when et where kind It BP

portfolio time, companies you BP diversify for So time. companies, I the the into think -- with first to very recent energy ammonia they energy same at clear. are get the move those market successes for our and are shall very, but seeing announcements transition ready and the And is international our like

a So but Fulfilling sides between both say, I take and overall advantage to may actually little demand. well balance and very it demand well placed take the really overall sides that think differ reducing. demand think very in as of both positioned and we're advantage I is not I we're of the

happening, Investor or think we're to lot demand Again, in that in these ever a present And that positioned have only presented well be present very Day that there, is of we and markets. you I given have where

STS. why for I That's and continue. seeing the very it STS may performance So that's the performance strong outlook in so think you're why we bullish on remain and

Andrew Kaplowitz

consolidated up? helping? And the Plaquemines And equity Is that moving QX was continuing to contribution in in to then affiliates higher equity earnings pick up to level pick or continue earnings the Mark, model of QX again. just of forward? and run else rate Stuart Is is right there anything

Mark Sopp

sometimes say, a said, much I [indiscernible] right is think is peak Plaquemines pretty I Andy, would or now. that

quite the which to and strong, earnings and equity It will to a And terrific, in wane little so off bit contributing programs project start that stay really is so Aspire. a 'XX strong also that will you're we're like is that more seeing, and What from bit is seeing. it in 'XX.

Brown really grow, energy contributions as is dynamics continued at the the benefiting that quite along mentioned Our Stuart from and peak those but as project that has to to have joint its well. Root pace not ramped here, really earlier it the security come venture LNG has up

but diversified reasons. more ] And for -- in healthy pretty so line, think XX than might the that and of see bit a from number little . a just this dissipate might It's you that quarter, much. it's And is [ lot steady. you this not that but year

Operator

The next Jain Keybanc Capital line from from is Sangita Markets.

Sangita Jain

perspective, of But rates it's X So normalizing. just on at peak us burning that headwind Plaquemines. expect from modeling that should go the now. tell when to a understand first right we Can we book-to-bill you think I away? should when

Mark Sopp

through halfway year. next Probably

Sangita Jain

Was your seems private days? acquisition those or ask was can deals seeing of the And acquisition. Okay. more Got It are from of coming about an these that a competitive you you it. LinQuest way kind a less a firm. I it follow-up, equity like as And process? through

Stuart Bradie

end. the outlook on competitive would strong think kept that was I into somewhat competitive through our was -- part and very us very down again, And But But say was we're we played through Yes, a quickly, opportunity. -- circumvented process. the values position a getting discipline at process, but process. narrowed and think quite it management that And I the we yes, process into which and aligned a was much terrific. I a it that -- with that

what to In to terms in a bulk for we're -- all they market they to at -- have quite acceleration, yes, reasonable have strategically. buy to a seeing, in like bit there's things And today. fit well, out, also we of the cetera. we We but buy have be et price, this strategic don't but area, be

to look. continue we'll So

firepower. do we some have said, Mark As

up the deleveraging a for happy if are balance rig story, [indiscernible]. tick a much and and to very the healthy makes we've We in got still it sheet bit we're sense,

but is just. the active, market So quite yes,

and year that, integration, there's it But and this liquid really in any get that off our saying deliver we our if need business upside really through the to that's primary footing, close to to all firm deliver mission. that,

Operator

TD question Khanna from next Cohen. Gautam The is from

Gautam Khanna

the backlog should And that it what's the you is was mechanics milestones in of we, chemicals, for? like going that how like on be we to be at liquid that I to curious does If point to appear expect of sort more that incremental and us? kind years? like over couple of the a frame Or lump next major it sum a number some booking you for in is could going quarters? be looking of

Stuart Bradie

Yes.

what the big typically [indiscernible], is you level -- is and request, which way agree do authorization on they work that I work things of the think, programs is Aramco a called these there. Gautam, effort

booking. the bank So incremental more big than it's

And to backlog. in through going so the it's way that's come

way -- backlog in it, not we best about and a is time. big clear be. is that describe can but we be over we of will that bang. the we'll coming we think think when more than I But what So [indiscernible] what slow see talk we very how what through typically, could a and it it's

Gautam Khanna

bookings for Okay. but orders orders, finer dollar on just in reflects that a STS that received And STS? the the down, backlog like value actual Plaquemines. the the second to What then we the of quarter some came put of were point quarter recognized the

Stuart Bradie

Because revenue was X.Xx obviously, doesn't the -- come stated. it's it the burn actually the yes, through revenue. burn, Well, that Plaquemines X.Xx excluding

Mark Sopp

million, take. Roughly or give . $XXX

Stuart Bradie

Yes.

Gautam Khanna

open? time? and last over million. may $XXX roughly LinkWest. was I question Okay, that any did Or on fade set-aside business have that full then XXX% And curious, they is

Stuart Bradie

small It's XXX% no open. at business there There's in fully all.

Operator

The Revich cash. Goldman from next is from question Jerry

Adam Bubes

on Jerry. Adam is for This

that timing You as $XX awardees thinking $XX were X that MQSX you XX what to the ramp? of on percent could contract, over of And KBR selected billion the how time? billion of are about flow the

Stuart Bradie

Yes.

ceiling value. award. about said, mean, I the it's I very substantial we're a As excited

new of each through you sort the our in to human I business. Adam, if order, contract, volume like. really and as our customer new of it's reinforces health to a a customer and want It's excited. credentials new speculate, given the the could of awards side as separate But don't very really come are that a a We work

more we -- get $XX could million, is up that, I it I new skis, -- year brand it's guess, don't well in would I'm base answer. to business think it us. less But But we'll get We're of for I just for a speculating. know very want $XX as out tell much than you. sort if million, new a well, to a million in, but or think a very the absolutely front of we us, could a it's I don't $XX do

a I'm So it's view there. we get activities And you I guess, think as kind of But we news. more, report, sure bit very our into should upside. good I is can very,

as it arena. we should And as I you it forward as you strategically move view think that upside think in forward. should step I a see potential

Mark Sopp

great is I'll And add portfolio. we've this the on also performance within in particular I'll said our in real add we held niche really human this a performer only that we're "household on the of that really name area, as award, awardees. and a earlier, good been run

biggest the wide And and variety a be to are here. so XX able may of most most there the niche think, the I deliver capabilities other we're, players in recognized but

So it's really day, said. but that, Stuart pretty as excited about

Adam Bubes

of update then the us to STS, Where just the your progress you in projects far? made forward in progress? moving additional stand that what's so And projects phase? on can And we construction timing construction monetization plastics on moved do have

Stuart Bradie

Yes.

have Day, site we we expected. It the product got our again, today. -- under progressed And to in QX. The than said got X slower -- do as in we Mura. them got we've build. at started we've construction be think is work Investor expect we They involved U.K. producing a X I this stick that to So with before

And mechanical been taken involved And where modularize the that as year proven end of to at it's consequence, we've I QX. we Chem, where so have that's And in now. LG schedule the solution. completion a Korea the a is other they're think sort of with execution right and we reach X looking been the off

been on is we've then very, So QX Japan, to third very doing much very in year. and that. next will which party the Again, in X And well. schedule be

that's key we think well the sites, these face-to-face, is probably of like X in of opportunities mature. sit. that, like, if The looks very to very Over above view, construction I but this have North So actually actually under site where unlock product producing and Europe in a is U.K. you to and America all see through the and that progress if are X is of see you that, to in had a like, in parties the We've what number interested a the positive. plan and Stuart

-- to confident and lot I . to that new but we've coming behind unlock activity think once very although you'll number facility running up to very, we're technologies, got the back see a there's a in happens, think producing. that all is market and And I the marketplace. key get of it, So this

Operator

Thank you.

will questions, have currently no further we closing hand Stuart for remarks. As to I Bradie back now

Stuart Bradie

you, Thank Kiki.

call. listen to time It's mission it's none very reiterate, to the excited taking our capability the a today. the really synergy around So remarks in that accelerates us I'll terrific acquisition heard particularly the prepared on and of as you've is strategy occasions our the and questions, opportunities. really this in -- for We're IT LinQuist, real strong guidance. thank play customer through and We for think the and you obviously, about again of numerous addition a set.

we HSR we'll of And look little a But and having a a year through through volatile at overperformance to raised get with that. world. the bit obviously, so close, be get once in guidance prudently halfway

of good really potential backlog to going I market. about performance our signal forward. think our a the bookings send really and strong also We're pipeline and operational feeling our

of But it's with year. we up, work all lot lot to year, pleased halfway end of So the company obviously, to of to good. chop so at a the the is a where the get in through very so far,

very . you thank So much.

Operator

today's conference concludes call. This

You may lines. your Thank now you. disconnect

KBR (KBR) 24 Jul 242024 Q2 Earnings call transcript