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KBR Wins Contract From Haifa Group, Boosts Technology Unit

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KBR, Inc. (KBR - Free Report) recently won a nitric acid technology contract for two of the Haifa Group’s process plants at Mishor Rotem, Israel.

Per the agreement, KBR’s Technology Solutions unit will provide the primary engineering design and proprietary equipment along with license for both the plants so that each of them can deliver an added capacity of nearly 35%.
With respect to this, KBR's Technology Solutions president, Doug Kelly, said, “KBR has the industry's leading design for energy-efficient nitric acid production in both mono-pressure and dual-pressure plants, and we look forward to working with Haifa to deliver higher production capacities while lowering plant emissions and operating expenses.”

KBR has a solid expertise when it comes to nitric acid technology, where the company combines its plant experience with with leading-edge technology innovation. The technology has been employed in 75 plants worldwide since 1950. This includes approximately 80% of all U.S. plants.

KBR’s recent partnership with Haifa Group will help it in increasing the agricultural yields, while maintaining an ecological balance. It will also double the production capacity in the coming years.

Technology Solution Unit: A Key Catalyst

The Technology Solutions business is one of the major contributing units of KBR. The segment integrates innovative, proprietary process technologies. It comprises synergistic advisory practice focused on energy transition and net-zero carbon emission consulting as well as technology-led industrial solutions that concentrate on innovative digital operations and maintenance solutions and advanced remote operations capabilities to improve throughput, reliability along with environmental sustainability. Strengthening of the Technology Solutions business with its high-end, sustainability-focused industrial sector expertise and client relationships creates exciting synergy opportunities.

Robust backlog is another important factor driving the company’s growth. Majority of these works are long-term reimbursable service annuity-type contracts that have significantly lower risks than some of the other projects. The company believes that this will ultimately help in margin expansion and de-risking of business considerably. Primary growth drivers include high-end and differentiated government business work, strong margin performance, and technology and consulting business.

KBR’s shares have rallied 27.7% in the year-to-date period compared with the Zacks Engineering - R and D Services industry’s growth of 20.6%. Meanwhile, earnings of KBR, which shares space with Altair Engineering Inc. (ALTR - Free Report) , Jacobs Engineering Group Inc. (J - Free Report) and AECOM (ACM - Free Report) in the Zacks Engineering - R and D Services industry, surpassed the consensus mark in 13 of the trailing 14 quarters.

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The Zacks Consensus Estimate for this Zacks Rank #3 (Hold) company’s 2021 earnings indicates an improvement of 22% from 2020. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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