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Fri August 04, 2017 - National Edition
Fluor Corporation today announced financial results for its second quarter ended June 30, 2017. The second quarter was a net loss attributable to Fluor of $24 million, or $0.17 per diluted share, compared to net earnings attributable to Fluor of $102 million, or $0.72 per diluted share a year ago. Results for the quarter include an after-tax charge of $124 million, or $0.89 per diluted share, for estimated cost increases on three gas-fired power projects. Consolidated segment profit for the quarter was $15 million, down from $230 million a year ago. Second quarter revenue was $4.7 billion compared to $4.9 billion in the prior year.
New awards for the quarter were $3.2 billion, including $1.1 billion in Government, $860 million in Energy, Chemicals & Mining, $672 million in Industrial, Infrastructure & Power and $554 million in Diversified Services. Consolidated ending backlog was $37.6 billion.
“The challenges we have experienced over the last two years on gas-fired power projects are inconsistent with the results we have historically achieved,” said David Seaton, Fluor chairman and chief executive officer. “With the recent leadership and organizational changes made in our power segment, a reassessment of the power market is underway to determine where the gas-fired power business offers adequate return opportunities consistent with our expectations and long term experience.”
Corporate G&A expense for the second quarter of 2017 was $47 million, compared to $53 million a year ago. Fluor's cash and marketable securities balance at the end of the second quarter was $2.1 billion. During the quarter, the company generated $158 million in cash from operating activities, and paid out $29 million in dividends.
As a result of the charge in Industrial, Infrastructure & Power, and, to a lesser extent the wind down of the V.C. Summer Nuclear Station project, the Company is revising its 2017 guidance for EPS to a range of $1.40 to $1.70 per diluted share, from the previous range of $2.25 to $2.75 per diluted share.
Fluor's Energy, Chemicals & Mining segment reported segment profit of $127 million, compared to $126 million in the second quarter of 2016. Second quarter revenue of $2.3 billion declined from $2.5 billion a year ago primarily due to reduced activity on Gulf Coast chemicals projects. New awards for the segment totaled $860 million and ending backlog was $19.2 billion compared to $25 billion a year ago.
The Industrial, Infrastructure & Power segment reported a segment loss of $168 million, compared to a segment profit of $51 million in the second quarter of 2016. Results for the quarter include approximately $194 million in pre-tax project expenses related to forecast adjustments on three gas-fired power projects. Revenue for the segment was flat at $1 billion compared to a year ago. New awards in the second quarter were $672 million, including the Southern Gateway highway project in Texas. Ending backlog for the segment was $11.4 billion, compared to $12.7 billion a year ago, and reflects an adjustment for the V.C. Summer Nuclear Station project that is winding down.
The Government segment reported segment profit of $20 million, compared to $22 million a year ago. Revenue for the quarter was $744 million, compared to $658 million a year ago. Second quarter new awards of $1.1 billion include task orders for LOGCAP IV in Afghanistan and additional funding for the Strategic Petroleum Reserve and the Idaho Cleanup Project Core Contract. Ending backlog was $4.1 billion compared to $5.8 billion a year ago.
The Diversified Services segment reported segment profit of $36 million in the second quarter of 2017, compared to $31 million a year ago. Revenue for the quarter was $641 million compared to $712 million in the second quarter of 2016. New awards totaled $554 million for the quarter, and ending backlog was $2.9 billion compared to $3.7 billion a year ago.
For more information, visit www.fluor.com.