Kbr, Inc. · NYSE:KBR
Kbr — Investor Presentation (November 2015)
24 slides from Kbr's investor presentation, Nov 30, 2015
Slide 1: Investor Presentation November / December 2015
Investor Presentation November / December 2015 Stuart Bradie – President and Chief Executive Officer Brian Ferraioli – EVP and Chief Financial Officer Zachary Nagle – VP, Investor Relations
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. These forward-looking statements include statements regarding our plans, objectives, goals, strat
Slide 3: KBR's Zero Harm 24/7
KBR’s Zero Harm 24/7 5-Year TRIR Performance 0.45 0.4 0.39 0.39 0.37 0.35 0.34 0.35 0.35 0.31 0.32 0.3 0.30 0.25 0.26 0.23 0.22 0.2 0.21 0.19 0.18 0.15 0.1 0.05 KBR TRIR IOGP Top Q IOGP Average 0 2010 2011 2012 2013 2014 2015 3
Slide 4: KBR Overview
KBR Overview • KBR, Inc. is a global technology, engineering, procurement and construction company serving the hydrocarbons (predominantly Gas Monetization) and government services industries. • More than 100 year proud history. • #424 in Fortune 500 rankings. • ~ 25,000 employees in more than 40 co
Slide 5: Strategic Objectives
Strategic Objectives • Focus on differentiated offerings in core markets / clients with emphasis on global sales, commercial rigor and consistent delivery • Streamline operations and significantly reduce costs • Rebalance business portfolio • Continue efforts to proactively resolve commercial disput
Slide 6: Strategic Priorities
Strategic Priorities Early project involvement Priority Markets via differentiated technology Global Hydrocarbons (Gas) & (gas monetization) & International Government specialized consultancy Services services 1 2 Re-focus Growth Strategy 3 Pursue Fixed Price EPC 4 when differentiated by: - KBR Tech
Slide 7: Framework to Support Core Focus
Framework to Support Core Focus Exit non-strategic businesses: One KBR: - Stand-alone Fixed Price EPC Power Consistent use & application of - Fixed Price U.S. Infrastructure & standard policies, processes, systems, U.S. Minerals tools & procedures to deliver - Building Group consistency and efficien
Slide 8: Structure – Streamlined / Focused
Structure – Streamlined / Focused Old KBR operating segment structure (16 business units) KBR Infrastructure, Gas Hydrocarbons Government & Services Operations Monetization Power New streamlined operating segment structure (5 business units) KBR Technology & Engineering & Government Consulting Const
Slide 9: Global Leadership Team
Global Leadership Team Stuart Bradie President and CEO E&C Group President 27 Years of Industry Experience Brian Ferraioli John Derbyshire Engineering & Construction Andrew Pringle Engineering & Construction CFO Technology & Consulting Government Services 37 Years of Industry 37 Years of Industry 14
Slide 10: Technology and Consulting Business
Technology and Consulting Business Broad Range of Technologies and Solutions from Wellhead to Specialty Chemicals – Primarily Gas Focused Upstream Downstream Proprietary Semi-submersible hull design Refining (VCC, ROSE, FCC, Hydroprocessing, Distillation) Technologies Monohull vessels Olefins (SCORE
Slide 11: E&C Core Sectors – Full Service Offering
E&C Core Sectors – Full Service Offering Full service EPC with primary focus on Natural Gas related projects OFFSHORE LNG / GTL ONSHORE ASSET SERVICES Oil & Gas Fixed Platforms Liquefaction Refining Maintenance Floating Facilities Regasification Petrochemicals Modifications Hulls, Moorings & Risers
Slide 12: Government – Core Services
Government – Core Services EMEA APAC AMERICAS Home Base Operational Support Asset Management International Base Operations Support Overseas Operational Support Systems Engineering Remote Life Support Services Programme Management Services Integrated Logistics Support Logistics Resilience Planning &
Slide 13: KBR Global Operations
KBR Global Operations Moscow Gothenburg Atyrau Edmonton London Beijing Seoul Baku Kabul Wilmington Tokyo Baghdad Delhi Houston Arlington Birmingham Bahrain Monterrey Kuala Lumpur Caracas Saudi Arabia Mexico City Dubai Singapore Freetown Pune Chennai Luanda Jakarta Rio de Janeiro Perth Sydney Canberr
Slide 14: Progress Report on Strategic Objectives
Progress Report on Strategic Objectives Strategic Objective Progress to date Exit non-strategic businesses Stand-Alone EPC Power The first of three power plants is largely complete. The second will be completed in 1Q 2016. The third is targeted for 1Q 2017 completion. U.S. Minerals & U.S. Infrastr
Slide 15: Market Outlook: Technology & Consulting
Market Outlook: Technology & Consulting Technology market opportunities led by ammonia, refining and olefins, particularly revamps – Middle East, North Africa, Eastern Europe & Asia. Opportunities in Eastern Europe for VCC (Veba Combi-Cracker) technology and converting heavy Hydrocarbons into li
Slide 16: Market Outlook: E&C
Market Outlook: E&C Recent strategic developments: Growing industrial services / maintenance business with N.A. Brown & Root joint venture. Strategic alliance for pipe fabrication & module assembly – key for EPC prospects in North America. 1 EPC contract award for multi-billion dollar Magnolia
Slide 17: Market Outlook: E&C (Continued)
Market Outlook: E&C (Continued) Good pipeline of near-term and long-term prospects: Increased focus on Middle East opportunities (refining and petrochemicals). Onshore upstream opportunities in Middle East & Caspian remain positive due to low cost to develop. JV with National Oil Company of Azer
Slide 18: Market Outlook: Government Services
Market Outlook: Government Services Confirmed preferred bidder for U.K. MoD Fixed Wing Training (MFTS) contract – another long-term annuity type project. Award expected Q4. U.K. Army re-basing – discussions continue on a sole source basis. Strong operational performance continues for U.K. PFI
Slide 19: Consolidated Results: Q3 2015 vs Q3 2014
Consolidated Results: Q3 2015 vs Q3 2014 Commentary Quarter Ending Third consecutive quarter of solid earnings and ($ in millions, except EPS) Sep 30, 2015 Sep 30, 2014 operational performance, following strategic restructuring charges in 4Q14. New awards $272 $ 1,099 Backlog impacted by 50% sal
Slide 20: Segment Reporting: Q3 2015 vs Q3 2014
Segment Reporting: Q3 2015 vs Q3 2014 Revenue T&C reflects less proprietary equipment and reduced upstream oil related project consulting activity; E&C reflects winding down of Quarter Ending Canadian pipe fabrication and N.A. construction projects and ($ in millions) Sep 30, 2015 Sep 30, 2014 red
Slide 21: Cash / Capital Allocation
Cash / Capital Allocation KBR Cash Balance Return of Cash to Shareholders ($ in millions) Q3 2015 Q2 2015 Since Jan ($ in millions) Q3 2015 YTD 2015 Jan-07 Domestic $304 $289 Share Repurchases $5 $22 $753 International $395 $381 Dividends $12 $35 $274 JV $69 $61 Total $17 $57 $1,027 Total $768 $731
Slide 22: Summary
Summary Third consecutive quarter of solid earnings and operational performance, following strategic restructuring charges in 4Q14. E&C management has made good progress de-risking the business through strong performance on Non-Strategic power projects and closing out Canadian pipe fab / mod ass
Slide 23: Appendix
Technology & Consulting Engineering & Construction Government Services
Slide 24: Consolidated EBITDA Reconciliation Q3 2015
Consolidated EBITDA Reconciliation Q3 2015 Quarter Ending ($ in millions) Sep 30, 2015 Sep 30, 2014 Net Income Attributable to KBR $55 $30 Add Back: Interest Income (Expense) ($2) $3 Provision for Income Taxes ($19) $1 Depreciation & Amortization ($10) ($19) Consolidated EBITDA $86 $45 Note: EBITDA