Slide 1: Fiscal 2020 and 4th Quarter Financial Results
Fiscal 2020 and 4th Quarter Financial Results February 22, 2021 Thefuture, The future,designed designedand anddelivered®. delivered. Stuart Bradie – President and Chief Executive Officer Mark Sopp – Executive Vice President and Chief Financial Officer Alison Vasquez – Vice President, Investor Relati
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: Stuart Bradie
Stuart Bradie President and Chief Executive Officer
Slide 4: KBR's Road to Net-Zero Carbon Emissions
C LI M AT E KBR’s Road to Net-Zero Carbon Emissions C HA N G E Step 1 – Achieving Carbon Neutrality We commissioned an independent provider to calculate our 2019 scope 1 and 2 emissions and business travel emissions. We used our footprint to inform our carbon offset program and achieved carbon neutr
Slide 5: FY 2020 | Advancing our Strategy
FY 2020 | Advancing our Strategy ▪ KBR strategy in action ▪ Completed strategic acquisition of Centauri; integration progressing nicely ▪ Focused Sustainable Technology toward high-growth areas ▪ Opportunistically repurchased shares ▪ Delivered strong fiscal 2020 results ▪ $5.8 billion of revenue, $
Slide 6: Market Outlook | Defense & Intel
Market Outlook | Defense & Intel RECENT TRENDS AND WINS DEFENSE & INTEL 23% $4.2B ▪ Achieved 1.3x overall book-to- bill in the year; increasing REVENUE BACKLOG AND average contract value and tenor GROWTH OPTIONS ▪ Awarded over $900 million in FY 2020 IAC-MAC IDIQ tasks to perform Formerly Defense Sy
Slide 7: Market Outlook | Science & Space
Market Outlook | Science & Space RECENT TRENDS AND WINS SCIENCE & SPACE 12% $2.5B ▪ Progressive engagement and REVENUE BACKLOG AND expansion on existing NASA GROWTH OPTIONS and DOD programs driving FY 2020 consistent growth Formerly Space & Mission Solutions ▪ Awarded a 5-year, $300 million contract
Slide 8: Market Outlook | Readiness & Sustainment
Market Outlook | Readiness & Sustainment RECENT TRENDS AND WINS READINESS & 1.3X $2.3B ▪ Awarded multi-year contract SUSTAINMENT BOOK-TO-BILL BACKLOG AND for management of automated FY 2020 OPTIONS fuel systems to plan and perform preventative and Formerly Logistics corrective maintenance; support d
Slide 9: Market Outlook | International
Market Outlook | International RECENT TRENDS AND WINS INTERNATIONAL 60%+ $7.4B ▪ Awarded project to redesign officer and recruit augmented- / GROWTH IN BACKLOG virtual reality and 3-D model- GS AUSTRALIA based training programs for the FY 2020 Australian Department of Defence ▪ Expanded services und
Slide 10: Market Outlook | Sustainable Technology Solutions
Market Outlook | Sustainable Technology Solutions RECENT TRENDS AND WINS SUSTAINABLE TECHNOLOGY 1.4X $2.6B ▪ Entered exclusive alliance with Mura Technology to offer Cat- SOLUTIONS BOOK-TO-BILL BACKLOG HTRTM, a sustainability-focused, HERITAGE TS (TS AND ES) innovative technology that recycles FY 20
Slide 11: Market Outlook | In Summary
Market Outlook | In Summary KBR Pursuit Pipeline Lead $47B 95% 20% RECOMPETE 2020 GROWTH IN GS WIN RATE IN 2020 BACKLOG AND OPTION Positioning $44B & Pursuit Proposal & $14B LOW 22% Negotiation RECOMPETE RISK 2020 GROWTH IN IN 2021 TECHNOLOGY BACKLOG $105 Billion 150+ Pursuits > $100M 10+ Pursuits >
Slide 12: Mark Sopp
Mark Sopp EVP & Chief Financial Officer
Slide 13: FY 2020 | Financial Snapshot
FY 2020 | Financial Snapshot REVENUE ADJUSTED EBITDA1 ADJUSTED EBITDA MARGIN1 $5,639 $5,767 $471 $478 8% 8% 2019 2020 2019 2020 2019 2020 ADJUSTED EPS1 ADJ. OPERATING CASH FLOW1 BACKLOG $1.69 $1.73 $4B OPTIONS $290 $3B $256 $15B $15B BACKLOG 2019 2020 2019 2020 4Q19 4Q20 $ in millions, except EPS an
Slide 14: 4Q 2020 | Financial Snapshot
4Q 2020 | Financial Snapshot REVENUE ADJUSTED EBITDA1 ADJUSTED EBITDA MARGIN1 $135 9% $1,452 $1,466 $117 8% 4Q19 4Q20 4Q19 4Q20 4Q19 4Q20 ADJUSTED EPS1 ADJ. OPERATING CASH FLOW1 BACKLOG $0.51 $4B OPTIONS $3B $0.46 $57 $15B $15B BACKLOG $21 4Q19 4Q20 4Q19 4Q20 4Q19 4Q20 $ in millions, except EPS and
Slide 15: FY 2020 | Segment Results
FY 2020 | Segment Results Government Solutions Technology Solutions Energy Solutions Revenue Adj. EBITDA Revenue Adj. EBITDA Revenue Adj. EBITDA 3,925 3,934 10% 11% 374 415 25% 29% 1,526 404 303 1,339 94 6% 86 75 3% 44 FY19 FY20 FY19 FY20 FY19 FY20 FY19 FY20 FY19 FY20 FY19 FY20 ▪ 12% growth in Scien
Slide 16: Capital Deployment and Liquidity Profile
Capital Deployment and Liquidity Profile HEALTHY LIQUIDITY PROFILE CAPITAL NET Net Leverage Target DEPLOYMENT LEVERAGE ▪ ▪ Target net leverage set at 2.5x-3.0x Reflects shift in portfolio toward TARGET PRIORITIES sustaining, differentiated, cash- generative portfolio 2.5x to 3.0x TARGET RANGE Near-T
Slide 17: Initiating FY 2021 Guidance
Initiating FY 2021 Guidance FY 2021 Guidance Consolidated Revenue $5.8 - $6.2 billion 4% growth from 2020 at the midpoint Adjusted EBITDA Margin ~9% ~70 bps expansion from 2020 Adjusted EPS1 $2.00 - $2.20 >20% growth from 2020 at the midpoint Effective tax rate 25% - 26% Adjusted operating cash flow
Slide 18: Key Takeaways
KEY TAKEAWAYS ▪ Disciplined strategic execution, excellent resilience, and strong financial performance in 2020 ▪ Attractive growth in highly differentiated, technology- enabled businesses, increasing visibility, expanding margins and reducing volatility risk ▪ Strong market fundamentals combined wi
Slide 19: Save the Date: 2021 Investor Relations Event
SAVE THE DATE Gear KBR’S 2021 INVESTOR RELATIONS EVENT FU TURE,,FORWARD SCIENCE TECHNOLOGY ENGINEERING < - i " 2S : _ i a MARCH 25, 2021 | 9:00am cst a ogee e a y re & & i : c i DELIVERING SOLUTIONS, CHANGING THE WORLD,
Slide 20: Appendices
Appendices Appendices DOING THE RIGHT THING FOR THE PLANET, OUR PEOPLE AND OUR COMMUNITIES WHILE PURSUING BUSINESS GROWTH
Slide 21: Non-GAAP Reconciliations: Adjusted EPS & Adjusted Cash Flow
Non-GAAP Reconciliations: Adjusted EPS & Adjusted Cash Flow Adjusted EPS Reconciliation Adjusted EPS Guidance Quarter Ending 4Q19 4Q20 FY19 FY20 2021 Guidance EPS (Diluted) $0.40 $0.13 $1.41 $(0.51) EPS (Diluted) $1.39 $1.59 Add Back: Add Back: Restructuring and impairment charges 0.00 0.20 0.00 1.8
Slide 22: Non-GAAP Reconciliation: Consolidated & Adjusted EBITDA
Non-GAAP Reconciliation: Consolidated & Adjusted EBITDA EBITDA is defined as earnings before interest income / expense, income taxes, other non-operating income / expense (including FX) and depreciation & amortization. Adjusted EBITDA Reconciliation Quarter Ending Quarter Ending Mar 31, 2019 Jun 30,
Slide 23: Non-GAAP Reconciliation: Segment EBITDA and Segment Adjusted EBITDA
Non-GAAP Reconciliation: Segment EBITDA and Segment Adjusted EBITDA EBITDA is defined as earnings before interest income / expense, income taxes, other non-operating income / expense (including FX) and depreciation & amortization. Quarter Ending Quarter Ending Mar 31, 2019 Jun 30, 2019 Sep 30, 2019
Slide 24: Operating Income by Segment
Operating Income by Segment FY 2020 ($ in millions, except EPS) GS TS ES NSB Other Total KBR Revenues $ 3,934 $ 303 $ 1,526 $4 $0 $ 5,767 Gross Profit $ 483 $ 105 $ 86 ($8) $0 $ 666 Equity in Earnings 25 - 5 - - 30 SG&A (158) (23) (65) - (89) (335) Acquisition & Integration - - - - (9) (9) Goodwill