Slide 1: Q2 2022 Earnings Presentation
August 2, 2022 Stuart Bradie, President and CEO Mark Sopp, Executive VP and CFO Alison Vasquez, VP of Investor Relations 1
Slide 2: Forward-Looking Statement
FORWARD-LOOKING STATEMENT The statements in this presentation that are not historical statements, including statements regarding future financial performance, are forward-looking statements within the meaning of the federal securities laws. These statements are subject to numerous risks and uncertai
Slide 3: Stuart Bradie, President and Chief Executive Officer
Stuart Bradie President and Chief Executive Officer 3
Slide 4: Quarterly Earnings: Delivering Solutions, Changing the World
RECYCLE/ REUSE HEALTH, SAFETY & SECURITY [oN EFFICIENT aie GOVERNANCE ENERGY SUSTAINABLE , ZER®© ncwsione TRAVEL ml a u AR M ia DIVERSITY SUPPLY ~. eae COMMUNITY PARTNERS i“ ENGAGEMENT - CLIMATE RISK CHANGE MANAGEMENT QUARTERLY £2Ez7 EARNINGS Delivering Solutions, Changing the World™ Car
Slide 5: The New Plastic Economy: Catalysing Action
5 The New Plastic Economy: Catalysing Action – The Ellen McArthur Foundation (2017); World Economic Forum (2018) 5
Slide 6: Excellent Q2 Results; Strong Momentum Toward 2025 Targets
nd EXCELLENT 2 QUARTER RESULTS; STRONG MOMENTUM TOWARD 2025 TARGETS ◦ Delivered growth across all key metrics during the quarter, including 19% growth in adj. EBITDA and 31% growth in adj. EPS; generated $125M of operating cash flow ◦ Expanding platform of long-term, resilient, mission critical prog
Slide 7: Market Outlook Government Solutions
MARKET OUTLOOK GOVERNMENT SOLUTIONS MARKET DRIVERS & OUTLOOK TRENDS, WINS & MOMENTUM ◦ U.S. Consolidated Appropriations Act of 2022 authorizes $782B for defense spending, up 6% from 2021, including 94% $15.5B $742B for the Department of Defense and $24B for NASA, 2022 Work Under Contract 2Q22 Backlo
Slide 8: GS | Growing Our International Footprint
GS|GROWING OUR INTERNATIONAL FOOTPRINT ▪ Developing high-end, innovative systems, engineering, and technology solutions to make lives safe, sustainable and affordable ▪ Advising governments and commercial customers on their digital transformation journeys ▪ Delivering best-in-class integrated platfo
Slide 9: Market Outlook Sustainable Technology Solutions
MARKET OUTLOOK SUSTAINABLE TECHNOLOGY SOLUTIONS MARKET DRIVERS & OUTLOOK TRENDS, WINS & MOMENTUM ◦ Global supply demand reconfiguration stemming from Ukraine/Russia War expected to drive near- and mid-term 85% 2022 Work Under Contract $3.7B 2Q22 Backlog investments to enable energy, chemical, and fo
Slide 10: STS | Earnings Growth and Margin Acceleration
STS | EARNINGS GROWTH AND MARGIN ACCELERATION ▪ Advancing climate change and carbon reduction objectives with advisory, engineering, program management and technology solutions ▪ Anchored by a portfolio of high-quality, proprietary IP/technology ▪ Excellent cash conversion; negative working capital
Slide 11: Mark Sopp, Executive Vice President and CFO
Mark Sopp Executive Vice President and Chief Financial Officer 11
Slide 12: Q2 2022 Results | KBR Delivers Outstanding Growth
nd 2 QUARTER 2022 RESULTS | KBR DELIVERS OUTSTANDING GROWTH +5% REVENUES REVENUES $1,536 $1,616 ADJ. EBITDA 10% Margin % 12% $186 +19% ADJ. EBITDA 9% $156 9% 2Q21 2Q22 2Q21 2Q22 +31% ADJ. EPS ADJ. EPS ADJ. OCF $125 $108 Capex Capex $344 +16% ADJ. OCF $0.58 $0.76 $98 Free cash $112 Free cash Deployab
Slide 13: Segment Results Demonstrate Mission Focus, Resilience and Agility
SEGMENT RESULTS DEMONSTRATE MISSION FOCUS, RESILIENCE AND AGILITY GOVERNMENT SOLUTIONS SUSTAINABLE TECHNOLOGY SOLUTIONS REVENUES ADJ. EBITDA1 REVENUES ADJ. EBITDA1 Margin % Margin % 1,231 1,312 12% 10% 305 304 15%3 18% 159 16 126 55 45 3 2Q21 2Q22 2Q21 2Q22 2Q21 2Q22 2Q21 2Q22 9% 22% ◦ GS revenue gr
Slide 14: Strategic, Accretive and Balanced Capital Deployment
STRATEGIC, ACCRETIVE AND BALANCED CAPITAL DEPLOYMENT 1.9x Net Leverage CAPITAL DEPLOYMENT PRIORITIES Fund Organic Growth as of June 30, 2022 Maintain Attractive Dividend Maintain Responsible Leverage $100M $73M Strategic M&A Share Repurchases Additional Investment in Acquisition of U.K.-based Mura T
Slide 15: Reaffirm FY 2022 Guidance
REAFFIRM FY 2022 GUIDANCE TO REFLECT MARKET AND BUSINESS MOMENTUM KBR, Inc. REAFFIRM FY 2022 Guidance FY 2022 REVENUE $6.4B - $6.8B FINANCIAL GUIDANCE ADJ. EBITDA MARGIN ~10% ADJ. EPS $2.53 - $2.65 90%+ EFFECTIVE TAX RATE 24% - 25% FY 2022 WORK UNDER ADJ. OPERATING CASH FLOW $360M - $400M CONTRACT 1
Slide 16: In Summary
IN SUMMARY ◦ Delivered outstanding results across all key metrics ◦ Strong end-market tailwinds in areas of global importance that favor KBR capabilities and technologies ◦ Winning highly strategic work to secure the future ◦ Generating value through strategic, balanced capital deployment ◦ A strong
Slide 17: Quarterly Earnings
QUARTERLY £2227 Delivering Solutions, Changing the World / =. EARNINGS
Slide 18: Appendices
Appendices QUARTERLY £2Ez7 EARNINGS - :s
Slide 19: Non-GAAP Reconciliations
NON-GAAP RECONCILIATIONS Adjusted EPS Adjusted Operating Cash, Free Cash, and Deployable Free Cash Flow 1 2Q21 2Q22 FY2022 Guidance 2Q211 2Q22 FY2022 Guidance Diluted EPS $(1.06) $0.61 $1.09 $1.21 Cash flows provided by operating activities $104 $125 $330 $370 Adjustments: Adjustments: Amortization
Slide 20: Non-GAAP Reconciliations: Adjusted EBITDA
NON-GAAP RECONCILIATIONS Adjusted EBITDA 1 1Q21 2Q211 3Q211 4Q211 1Q22 2Q22 Net income (loss) attributable to KBR $49 $(149) $57 $70 $(71) $94 Adjustments: Interest expense 19 20 20 21 20 21 Provision (benefit) for income taxes 17 40 20 34 19 33 Other non-operating (income) expense 3 (2) 1 7 0 (5) D
Slide 21: Non-GAAP Reconciliations: Adjusted EBITDA - Segment
NON-GAAP RECONCILIATIONS Adjusted EBITDA - Segment FY20 1Q211 2Q211 3Q211 4Q211 1Q22 2Q22 Pretax income attributable to GS $351 $74 $90 $112 $133 $114 $124 Interest expense 1 1 1 1 (1) 1 0 Other non-operating (income) expense 2 0 (1) 1 3 0 8 Depreciation and amortization 60 25 32 29 22 24 23 EBITDA
Slide 22: Reconciliation of Operating Income to Adjusted EBITDA
NON-GAAP RECONCILIATIONS Reconciliation of Operating Income to Adjusted EBITDA Quarter ended June 30, 2022 GS STS Corporate KBR Operating income $131 $32 $(36) $127 Noncontrolling interest 1 (1) 0 0 Unrealized gain on cost method investment 0 16 0 16 Depreciation and amortization 23 4 6 33 EBITDA $1