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KBR Wins Contracts From EuroChem & Hanwha, Fortifies Technology

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KBR, Inc.’s (KBR - Free Report) commitment to boost energy-efficient sustainable technologies has been driving its performance of late. The company recently received two technology contracts.

KBR INSITE — a cloud-based platform that provides remote monitoring and advisory services to customers — has been selected by EuroChem for its ammonia plant in Kingisepp, Russia. KBR INSITE will offer advisory services for three years to ensure optimal plant operations for EuroChem. Per the deal, KBR will proactively analyze EuroChem's ammonia plant operations and identify opportunities for achieving sustainable improvements in production, reliability, environmental impact as well as energy efficiency.

Additionally, KBR has won a dual-pressure nitric acid technology contract to provide license, design and technical support to Hanwha Corp.’s 1,200 metric tons per day nitric acid plant located at Yeosu, South Korea. Nitric acid is an intermediate chemical for the production of various products including fertilizers, plastics and dyes. KBR’s dual-pressure nitric acid technology offers tangible CAPEX and OPEX benefits including reduced net energy consumption.

Sustainable Technology Business a Boon for KBR

The Sustainable Technology Solutions segment — comprising 20.3% of the company’s total revenues — includes Energy Solutions, Technology Solutions and Non-strategic Business segments. This segment is anchored by innovative, proprietary process technologies.

KBR’s best-in-class technologies have been designing and building end-to-end, sophisticated digitization solutions as well as services for clients across the world. This includes high-fidelity operator training simulators, reliability-based maintenance solutions, dynamic simulation solutions, advanced process control solutions and more. These notable digitized technologies and solutions allow companies to increase efficiency and productivity, reduce costs as well as create opportunities for generating higher revenues and profitability.

Since 1954, KBR has licensed 76 grassroot nitric acid plants across the globe. Additionally, the segment integrates proprietary KBR technologies, knowledge-based services and the company’s three specialty consulting brands — Granherne, Energo and GVA — under a sole customer-centric business across the world. KBR, with a focus on climate change, has developed and/or designed several sustainable as well as renewable fuel projects across the globe over the past decade.

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Overall, it has been driving growth by focusing on lowering carbon emissions, product diversification, energy efficiency, and more sustainable technologies as well as solutions. Demand for the company’s technologies across ammonia for food productions, olefins for non-single-use plastics, and in refining for product diversification and more green solutions to meet tighter environmental standards has been strong. A strategic shift to IP-enabled maintenance is gaining traction and KBR continues to see increasing activity across the advisory portfolio, particularly in energy transition.

Solid Backlog Level & Share Performance

As of Jun 30, 2021, total backlog was $19.9 billion compared with $19 billion at 2020-end. Of the total backlog, Government Solutions booked $12.4 billion. The Sustainable Technology Solutions segment accounted for $2.5 billion of the total backlog.

KBR’s solid prospects are backed by continuous contract wins, strong project execution, backlog level, and potential government as well as technology businesses. KBR’s shares have gained 38.3% in the past year, outperforming the Zacks Engineering - R and D Services industry’s 28.6% growth.

Zacks Rank & Other Key Picks

Currently, KBR carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other top-ranked stocks in the same industry include Jacobs Engineering Group Inc. (J - Free Report) , ChampionX Corporation (CHX - Free Report) and Quanta Services, Inc. (PWR - Free Report) , each carrying a Zacks Rank #2.

Jacobs, ChampionX, and Quanta Services’ earnings for current year are expected to rise 13.5%, 421.1%, and 21.5%, respectively.