Slide 1: 3Q 2017 Financial Results
3Q 2017 Financial Results October 31, 2017 Stuart Bradie – President and Chief Executive Officer Mark Sopp – Executive Vice President and Chief Financial Officer Nelson Rowe – Senior Vice President, Investor Relations
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements regarding our plans, objectives, goals, strategies, future events, future financial performance and backlog information and other information that is not historical. When used in this presentation, the words “estimates,
Slide 3: Safety: Moving Towards Zero Harm
SAFETY Safety: Moving Towards Zero Harm Total Recordable Incident Rate (TRIR) Performance: 2011- Q3 2017 0.50 0.43 0.38 0.40 0.36 0.42 0.31 0.30 0.35 0.35 0.28 0.32 0.24 0.18 KBR is focused on an 0.20 0.24 0.23 0.21 0.21 industry-leading 0.19 0.18 0.16 0.16 commitment to employee 0.10 safety 0.00 20
Slide 4: 3Q17: Highlights
3Q17 3Q17: Highlights HIGHLIGHTS Strong results, solid project execution, robust bookings, better working capital management, raising guidance Delivering growth in Government Services, over $1B awarded on key contracts, Book/Bill 1.5x Significant and strategic wins NAVFAC Diego Garcia BOS
Slide 5: Consolidated Results: 3Q17 vs 3Q16
RESULTS Consolidated Results: 3Q17 vs 3Q16 Quarter Ending ($ in millions, except EPS) Sep 30, 2017 Sep 30, 2016 Bookings $ 1,075 $ 1,491 3Q17 revenues reflect the impact of the two Backlog of Unfilled Orders $ 10,342 $ 11,431 GS acquisitions and organic growth in U.S gov’t contracts offset with E&
Slide 6: Segment Results: 3Q17 vs 3Q16
SEGMENT Segment Results: 3Q17 vs 3Q16 RESULTS Quarter Ending ($ in millions) Sep 30, 2017 Sep 30, 2016 Government Services Revenues ‒ Increases in revenue and gross profit & equity Government Services 582 401 in earnings are driven by late 3Q16 acquisition, Technology & Consulting 78 67 organic gr
Slide 7: Cash and Debt Position
CASH Cash and Debt Position Quarter Ending Cash and Net Debt Position Mar 31, 2017 Jun 30, 2017 Sep 30, 2017 Cash: Balance $ 410 $ 491 $ 511 Debt: Revolver Borrowing ($650) ($470) ($470) Net Cash (Debt) Position ($240) $ 21 $ 41 Continued Cash Growth 7
Slide 8: 2017 Earnings Guidance
2017 2017 Earnings Guidance GUIDANCE Prior FY Updated FY Guidance Guidance Adjusted EPS , excluding legacy legal fees $1.25 ‐ $1.45 $1.35 ‐ $1.50 • Includes PEMEX settlement recorded in 2Q17 • Includes $22M or $0.15 EPS in amortization • Estimated legacy legal fees is $13M or $0.09 EPS EBITDA range
Slide 9: 4Q17 Expectations
4Q17 Expectations MARKET OUTLOOK Performance Expectations: ‒ Revenue o Flat revenues for Government Services as new awards expected to contribute late December o T&C growth expected to continue fueled by ammonia, petro-chem and refining markets o E&C expected to decline, impacted by capex projects
Slide 10: 3Q17 Summary
CONCLUSION 3Q17 Summary Delivering growth in Government Services, realizing synergies Strong margins in T&C, growth expected in 4Q Solid execution and repositioned reliance from large capex projects to multiple and smaller recurring opex projects in core E&C segment High-level of secured bac
Slide 11: Appendix
APPENDIX
Slide 12: Significantly Lower Risk Profile
3Q17 BACKLOG Significantly Lower Risk Profile Backlog by Contract Type 95% of earnings for 2017 secured in backlog Cost Fixed Price Reimbursable, Contracts Majority of KBR backlog is currently either PFI & Services (GS, T&C) – long-term, reimbursable, PFI or service Contracts Low Risk contracts
Slide 13: Consolidated EBITDA Reconciliation
NON-GAAP RECONCILIATION Consolidated EBITDA Reconciliation Quarter Ending ($ in millions) Sep 30, 2017 Sep 30, 2016 Net Income Attributable To KBR $ 45 ($63) Add Back: Interest Expense (Income) $6 $3 Provision for Income Taxes $ 16 ($11) Other Non-Operating Expense (Income) $4 ($2) Depreciation & Am
Slide 14: Adjusted EPS Reconciliation
NON-GAAP RECONCILIATION Adjusted EPS Reconciliation Quarter Ending Sep 30, 2017 Sep 30, 2016 EPS (diluted) $ 0.32 ($0.44) Add Back: Legacy Legal Fees $ 0.03 $ 0.00 Adjusted EPS $ 0.35 ($0.44)