Fluor, one of the major contractors in the Department of Energy complex, on Thursday reported a significant earnings spike for the third quarter of 2017.
The international construction and engineering firm reported quarterly net earnings of $94 million, or $0.67 per diluted share, compared to just shy of $5 million, or $0.03 per diluted share, during the third quarter of 2016.
Management cited positive trends in domestic and international infrastructure markets and oil and gas projects as part of the reason for the improved numbers.
Consolidated profit for the quarter was $203 million, significantly more than $25 million a year ago. Third-quarter revenue came in at $4.9 billion, up from $4.8 billion in the prior year, according to the Dallas-based company.
Fluor secured $3.8 billion in new awards for the quarter, including $234 million in its government business that contains its Energy Department cleanup work. The government business has a $3.6 billion backlog, down more than $5.9 billion a year ago. The government segment reported a $30 million profit, compared to $26 million a year ago.
“When you think about government work, there is no new work, you have to take it away from someone,” Fluor Chairman and CEO David Seaton said during the company’s earnings call with financial analysts. “And there is a fair amount of bids that are coming up in the next three to four quarters,” Seaton added during an earnings conference call.
Seaton did not offer any specifics on what those bids might be, aside from additional electric grid work in Puerto Rico in the wake of Hurricane Maria. Fluor was recently awarded a $240 million contract by the U.S. Army Corps of Engineers to help restore electric power to the island, he noted.
Fluor is spread widely around the DOE complex: It partners with BWX Technologies for decontamination and decommissioning at the Portsmouth Site in Piketon, Ohio, under a 10-year deal potentially worth more than $2.5 billion through 2021; in 2016 it took over remediation at the Idaho site through a five-year contract worth $1.4 billion; and it is a team member with Honeywell and Stoller Newport News Nuclear in the management and operations contractor for the Savannah River Site in South Carolina.
In May, DOE selected a joint venture comprised of CH2M, Fluor, and BWX Technologies for a contract valued at up to $1.5 billion over 10 years to lead the deactivation and remediation at the Paducah Gaseous Diffusion Plant in Kentucky. Fluor had held the contract previously.
The company has missed a couple of big-ticket DOE contracts in recent years.
Fluor was a support contractor for the $5 billion contract awarded in August 2016 to a Lockheed Martin subsidiary for management of the National Nuclear Security Administration’s Nevada National Security Site. However, the semiautonomous DOE nuclear stockpile steward within days revoked the contract upon learning that the subsidiary had passed hands to Leidos, and in May issued a new management deal to a Honeywell branch.
A Fluor-Westinghouse venture in October also lost a $4.7 billion DOE liquid waste management contract award for the Savannah River Site. Fluor-Westinghouse Liquid Waste Services is protesting the decision to the Government Accountability Office.
Fluor tightened its yearly earnings per share guidance, placing it a range of $1.50 – $1.60 compared to the prior range of $1.40 ‒ $1.70.
