KBR Inc. (KBR), an engineering, construction and services company, Friday reported a 35% increase in its third-quarter net income, as revenues improved 39% from last year, assisted by growth in all business segments, except one. The earnings also topped analysts' expectations.
The Houston, Texas-based company's net income for the third quarter rose to $85 million, or $0.51 per share from $63 million, or $0.37 per share reported last year.
Net income in the just concluded period included income from discontinued operations of $11 million, or $0.07 per share, resulting from foreign tax credits related to DML. In the prior-year period, net income included income from discontinued operations of $3 million, or $0.02 per share related to post-closing activities for previously disposed businesses.
Income from continuing operations increased to $74 million, or $0.44 per share, from $60 million, or $0.35 per share reported in the same period last year. Results of the latest period included a negative impact of about $0.04-$0.05 per share related to Hurricane Ike.
On average, 11 analysts polled by First Call/Thomson Financial expected earnings of $0.43 per share for the quarter.
KBR, split off from Halliburton Co. (HAL) last year, said consolidated revenue increased to $3.0 billion from $2.2 billion in the third quarter of 2007, exceeding Street estimate of $2.97 billion.
The company operates Downstream, Government and Infrastructure, Services, Technology, Upstream, and Ventures business units.
KBR, Pentagon's largest private contractor in Iraq, said revenue for the Government and Infrastructure segment increased 12% from last year to $1.759 billion with revenue from Middle East Operations increasing to $1.364 billion from $1.217 billion.
Upstream revenue rose 35% to $550 million, while Downstream revenues rose 34% to $138 million. Services revenue for the third quarter surged to $539 million from $77 million. In the Ventures segment, the company generated revenue of $1 million, compared to negative revenues of $2 million last year. However, Technology revenues dropped 27% to $19 million.
Total operating income increased to $144 million from $102 million in the previous year. In the latest period, operating income included a $13 million reversal of a charge related to an unfavorable jury verdict of about $40 million from litigation with a subcontractor on the LogCAP III contract in the second quarter of 2008. Operating income in the third quarter of last year included an $18 million pre-tax gain on the sale of KBR's interest in the Brown & Root-Condor Spa joint venture in Algeria.
For the first nine months of the fiscal, net income remained flat with last year at $231 million or $1.37 per share. Total revenue increased to $8.195 billion from $6.356 billion in the previous year.
Cash and equivalents as of September 30, 2008 was $1.110 billion, while it was $1.861 as of December 31, 2007.
Commenting on the results, Bill Utt, Chairman, President, and Chief Executive Officer of KBR, said, "This was a solid quarter for KBR, in terms of revenue growth, operating income growth, and earnings per share growth from last year's third quarter…KBR's long-term prospects across its end-markets remain positive and KBR is well-positioned to capture those opportunities."
The company noted that the integration of BE&K is going extremely well and BE&K Inc. is making strong contributions with new awards and financial performance.
KBR completed the acquisition of privately held engineering, construction and maintenance services firm BE&K for $550 million on July 1. Birmingham, Alabama-based BE&K's international operations are located in Poland and Russia.
KBR closed Thursday's regular trade at $14.07, up from the previous close of $13.22, on 6.18 million shares. For the past year, the stock trended in the range of $11.82-$44.46.
For comments and feedback contact: editorial@rttnews.com
June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.