KBR Inc. (KBR, Financial) filed Quarterly Report for the period ended 2012-06-30.
Kbr, Inc. has a market cap of $3.48 billion; its shares were traded at around $22.92 with a P/E ratio of 9.4 and P/S ratio of 0.4. The dividend yield of Kbr, Inc. stocks is 0.9%. Kbr, Inc. had an annual average earning growth of 22% over the past 5 years.
Services revenue in the second quarter of 2012 decreased by $20 million compared to the same period of the prior year. This decrease is primarily driven by lower revenue of $62 million from our Building Group, primarily due to the completion of several large hospital projects. Also, revenue decreased $32 million for our Industrial Services group, primarily due to the completion of a major turnaround project in 2011. These decreases were partially offset by increases in our U.S. Construction Group of $64 million and $10 million in our Canada operations, due to several new awards and increased activity on new projects.
Services revenue in the first six months of 2012 decreased by $69 million as compared to the same period of the prior year. This decrease is primarily driven by lower revenue of $100 million from our Building Group, primarily due to the completion of several large hospital projects. Also, revenue decreased $43 million for our Industrial Services group, primarily due to the completion of a major turnaround project in 2011. These decreases were partially offset by increases in our U.S. Construction Group of $56 million and $23 million in our Canada operations, due to several new awards and increased activity on new projects.
Provision for income taxes was $28 million in the first six months of 2012 and $61 million in the first six months of 2011. Our effective tax rate was approximately 12% for the six months ended of 2012 and 20% for the six months of 2011. Our effective tax rate excluding discrete items for the first six months of 2012 was lower than our statutory rate of 35% primarily due to due to favorable tax rate differentials on foreign earnings and lower tax expense on foreign income from unincorporated joint ventures. In the first six months of 2012, we also recognized discrete net tax benefits of approximately $39 million including benefits primarily related to the recognition of previously unrecognized tax benefits related to tax positions taken in prior years due to progress in resolving transfer pricing matters with certain taxing jurisdictions, statute expirations on certain domestic tax matters and other reductions to foreign tax exposures as well as discrete tax benefits related to deductions arising from an unconsolidated joint venture in Australia.
Government claims. Included in receivables in our condensed consolidated balance sheets are unapproved claims for costs incurred under various government contracts totaling $204 million at June 30, 2012, of which $105 million is included in “Accounts receivable” and $99 million is included in “Unbilled receivables on uncompleted contracts.” Unapproved claims relate to contracts where our costs have exceeded the customer s funded value of the task order. The $105 million of unapproved claims included in Accounts receivable results primarily from de-obligated funding on certain task orders that were also subject to Form 1 s relating to certain DCAA audit issues discussed above. We believe such disputed costs will be resolved in our favor at which time the customer will be required to obligate funds from appropriations for the year in which resolution occurs. The remaining unapproved claims balance of approximately $99 million primarily represents costs for which incremental funding is pending in the normal course of business. The majority of costs in this category are normally funded within several months after the costs are incurred. The unapproved claims outstanding at June 30, 2012, are considered to be probable of collection and have been previously recognized as revenue.
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Kbr, Inc. has a market cap of $3.48 billion; its shares were traded at around $22.92 with a P/E ratio of 9.4 and P/S ratio of 0.4. The dividend yield of Kbr, Inc. stocks is 0.9%. Kbr, Inc. had an annual average earning growth of 22% over the past 5 years.
Highlight of Business Operations:
Technology. Technology revenue and job income increased by $7 million and $1 million in the second quarter of 2012 compared to the same period of the prior year, respectively, primarily due to the progress achieved on a proprietary equipment project in Indonesia, license and engineering projects in Russia, China and U.S. These projects collectively contributed approximately $14 million to the increase in Technology revenue and approximately $6 million to the increase in Technology job income. Partially offsetting these increases were decreases in revenue and job income associated with the completion of engineering services on an ammonia project located in Brazil.Services revenue in the second quarter of 2012 decreased by $20 million compared to the same period of the prior year. This decrease is primarily driven by lower revenue of $62 million from our Building Group, primarily due to the completion of several large hospital projects. Also, revenue decreased $32 million for our Industrial Services group, primarily due to the completion of a major turnaround project in 2011. These decreases were partially offset by increases in our U.S. Construction Group of $64 million and $10 million in our Canada operations, due to several new awards and increased activity on new projects.
Services revenue in the first six months of 2012 decreased by $69 million as compared to the same period of the prior year. This decrease is primarily driven by lower revenue of $100 million from our Building Group, primarily due to the completion of several large hospital projects. Also, revenue decreased $43 million for our Industrial Services group, primarily due to the completion of a major turnaround project in 2011. These decreases were partially offset by increases in our U.S. Construction Group of $56 million and $23 million in our Canada operations, due to several new awards and increased activity on new projects.
Provision for income taxes was $28 million in the first six months of 2012 and $61 million in the first six months of 2011. Our effective tax rate was approximately 12% for the six months ended of 2012 and 20% for the six months of 2011. Our effective tax rate excluding discrete items for the first six months of 2012 was lower than our statutory rate of 35% primarily due to due to favorable tax rate differentials on foreign earnings and lower tax expense on foreign income from unincorporated joint ventures. In the first six months of 2012, we also recognized discrete net tax benefits of approximately $39 million including benefits primarily related to the recognition of previously unrecognized tax benefits related to tax positions taken in prior years due to progress in resolving transfer pricing matters with certain taxing jurisdictions, statute expirations on certain domestic tax matters and other reductions to foreign tax exposures as well as discrete tax benefits related to deductions arising from an unconsolidated joint venture in Australia.
Government claims. Included in receivables in our condensed consolidated balance sheets are unapproved claims for costs incurred under various government contracts totaling $204 million at June 30, 2012, of which $105 million is included in “Accounts receivable” and $99 million is included in “Unbilled receivables on uncompleted contracts.” Unapproved claims relate to contracts where our costs have exceeded the customer s funded value of the task order. The $105 million of unapproved claims included in Accounts receivable results primarily from de-obligated funding on certain task orders that were also subject to Form 1 s relating to certain DCAA audit issues discussed above. We believe such disputed costs will be resolved in our favor at which time the customer will be required to obligate funds from appropriations for the year in which resolution occurs. The remaining unapproved claims balance of approximately $99 million primarily represents costs for which incremental funding is pending in the normal course of business. The majority of costs in this category are normally funded within several months after the costs are incurred. The unapproved claims outstanding at June 30, 2012, are considered to be probable of collection and have been previously recognized as revenue.
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