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Babcock & Wilcox Shares Rise On Q4 Profit, 2013 Outlook

Babcock & Wilcox Co. (BWC) on Wednesday reported a turnaround to profit in the fourth quarter, reflecting higher revenues as well as lower costs and expenses, including pension mark-to-market losses. Revenues for the quarter beat analysts' expectations.

Looking ahead, the power-plant technology company forecast fiscal 2013 earnings per share above analysts' estimates. The company's shares gained more than 8 percent in extended trade.

North Carolina-based Babcock & Wilcox is a provider of clean energy technology and services for the nuclear, fossil, and renewable power markets.

Power Generation segment revenues for the quarter rose 9 percent from the year-ago period, primarily due to an increase in new-build environmental equipment revenues. Nuclear Operations segment revenues increased 12 percent on increased production of fuel for the naval reactor program and increased manufacturing of nuclear components for certain U.S. Government programs.

Meanwhile, Nuclear Energy segment revenues decreased 4 percent and Technical Services revenues declined 11 percent.

The company's total costs and expenses declined 12 percent to $817.72 million from $926.36 million in the previous-year quarter.

Babcock & Wilcox's fourth-quarter net income was $39.07 million or $0.33 per share, compared to net loss of $63.01 million or $0.53 per share in the year-ago period.

The latest quarter's results include one-time tax charges of $6.8 million or $0.06 per share and pension mark-to-market loss of $21.1 million or $0.18 per share. The prior-year quarter's results include pension mark-to-market loss of $139.2 million or $1.18 per share.

Excluding these items, adjusted earnings were $66.9 million or $0.56 per share, compared with adjusted earnings of $76.2 million or $0.65 per share a year ago. On average, analysts polled by Thomson Reuters expected the company to report earnings of $0.42 per share for the quarter. Analysts' estimates typically exclude special items.

Revenues for the quarter grew 8 percent to $865.30 million from $800.79 million in the prior-year period and beat analysts' consensus estimate of $841.74 million.

For fiscal 2012, Babcock & Wilcox's net income surged to $227.70 million or $1.91 per share from $78.32 million or $0.66 per share in the previous year.Adjusted earnings were $258.8 million or $2.17 per share, compared to adjusted earnings of $217.5 million or $1.84 per share last year.

Revenues for the year grew 12 percent to $3.29 billion from $2.95 billion in the prior year.

Analysts expected the company to earn $1.71 per share for the year on revenues of $3.27 billion.

The company's total backlog at the end of the year was $5.75 billion, up from $5.34 billion last year.

Babcock & Wilcox repurchased 3.9 million common shares at a total cost of $96.8 million in the fourth quarter 2012 under its $250 million share repurchase program. The company repurchased an additional 1.6 million shares through February 27, 2013 at an incremental cost of $42.3 million and has about $110.9 million of authorized capacity remaining.

Looking ahead to fiscal year 2013, Babcock & Wilcox expects adjusted earnings of $2.25 to $2.45 per share on revenues of $3.40 billion to $3.55 billion. Analysts currently expect earnings of $2.10 per share for the year on revenues of $3.48 billion.

BWC closed Wednesday's regular trading session at $26.43, up $0.70 or 2.72 percent on a volume of 800,928 shares. In after-hours, the stock further gained $2.32 or 8.78 percent to $28.75.

by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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