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Fluor's (FLR) Q3 Earnings Lag Estimates, New Awards Strong
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Fluor Corporation (FLR - Free Report) reported lower-than-expected third-quarter 2022 results. Notably, earnings and revenues missed the Zacks Consensus Estimate for the third consecutive quarter. Challenges associated with the company’s three legacy infrastructure projects weighed heavily on the results.
Following the results, shares of the company dropped 2%.
Elaborating on the future performance, David Constable, chief executive officer of Fluor, said, “Our near record new awards in the quarter, 91% of which were reimbursable cost contracts, shows that there is considerable demand for the services we provide.”
Fluor Corporation Price, Consensus and EPS Surprise
Fluor reported adjusted earnings of 7 cents per share, missing the Zacks Consensus Estimate of 48 cents by 85.4%. The reported figure declined significantly from 23 cents a year ago.
Quarterly revenues of $3,612 million missed the consensus mark of $3,923 million by 7.9%. The reported figure, however, increased 3.1% from the year-ago level of $3,503 million. The upside was primarily attributable to higher contribution from the Energy Solutions segment.
Overall, the company’s segment profit came in at $31 million, reflecting a decrease from $116 million a year ago. Segment margin of 0.9% contracted from 3.3% in the year-ago period.
Fluor's total new awards for the quarter came in at $9,743 million compared with $3,401 million in the year-ago period. Consolidated backlog at the end of the quarter came in at $25.42 billion, up from $20.8 billion at 2021-end.
Segmental Discussion
The company reports results in four reportable segments: Energy Solutions, Urban Solutions, Mission Solutions and Other.
The Energy Solutions segment’s revenues grew 16.6% year over year to $1,592 million for the quarter. The segment reported a profit of $59 million, down from $72 million a year ago. New awards came in at $3,574 million in the quarter, up from $644 million in the third quarter of 2021. The backlog at quarter-end was $10.18 billion compared with $9.32 billion at 2021-end.
Revenues in the Urban Solutions segment totaled $982 million, down 3.3% on a year-over-year basis. The segment incurred an operating loss of $54 million versus earnings of $18 million a year ago. New awards came in at $929 million for the quarter, up from $781 million a year ago. The backlog at quarter-end was $7.59 billion, up from $7.05 billion at 2021-end.
Revenues in the Mission Solutions segment totaled $639 million, down 11.6% on a year-over-year basis. The segment reported a profit of $29 million compared with $28 million a year ago. It booked new awards worth $4,874 million, up from $1,610 million a year ago. The backlog at quarter-end was $6.19 billion compared with $2.56 billion at 2021-end.
The Other segment — comprising NuScale — generated revenues of $399 million for the quarter versus $400 million in the year-ago period. This segment generated a loss of $3 million versus $2 million a year ago. It booked new awards worth $366 million, same as the year-ago quarter. The backlog at quarter-end was $1.46 billion compared with $1.87 billion at 2021-end.
Guidance
For the fourth quarter of 2022, Fluor expects adjusted earnings per share in the range of 50-60 cents. It expects adjusted EBITDA in the range of $125 to $150 million.
The consensus mark for the same is currently pegged at 46 cents per share.
KBR, Inc. (KBR - Free Report) reported third-quarter 2022 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
Nonetheless, the increasing global importance of national security, energy security, energy transition and climate change have been acting as major tailwinds for KBR.
EMCOR Group, Inc. (EME - Free Report) reported third-quarter 2022 results, wherein earnings and revenues surpassed the Zacks Consensus Estimate and increased year over year.
Given the solid momentum of the business activity amid a challenging macroeconomic environment, the company has lifted its revenues and earnings per share guidance for 2022.
United Rentals, Inc. (URI - Free Report) reported third-quarter 2022 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same. The company has been gaining from the sustained demand in its end markets and the strength of its core rental business.
URI also lifted its full-year guidance for total revenues and adjusted EBITDA, given broad-based end-market activity, contractor backlogs, customer sentiment and solid visibility.
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Fluor's (FLR) Q3 Earnings Lag Estimates, New Awards Strong
Fluor Corporation (FLR - Free Report) reported lower-than-expected third-quarter 2022 results. Notably, earnings and revenues missed the Zacks Consensus Estimate for the third consecutive quarter. Challenges associated with the company’s three legacy infrastructure projects weighed heavily on the results.
Following the results, shares of the company dropped 2%.
Elaborating on the future performance, David Constable, chief executive officer of Fluor, said, “Our near record new awards in the quarter, 91% of which were reimbursable cost contracts, shows that there is considerable demand for the services we provide.”
Fluor Corporation Price, Consensus and EPS Surprise
Fluor Corporation price-consensus-eps-surprise-chart | Fluor Corporation Quote
Inside the Headlines
Fluor reported adjusted earnings of 7 cents per share, missing the Zacks Consensus Estimate of 48 cents by 85.4%. The reported figure declined significantly from 23 cents a year ago.
Quarterly revenues of $3,612 million missed the consensus mark of $3,923 million by 7.9%. The reported figure, however, increased 3.1% from the year-ago level of $3,503 million. The upside was primarily attributable to higher contribution from the Energy Solutions segment.
Overall, the company’s segment profit came in at $31 million, reflecting a decrease from $116 million a year ago. Segment margin of 0.9% contracted from 3.3% in the year-ago period.
Fluor's total new awards for the quarter came in at $9,743 million compared with $3,401 million in the year-ago period. Consolidated backlog at the end of the quarter came in at $25.42 billion, up from $20.8 billion at 2021-end.
Segmental Discussion
The company reports results in four reportable segments: Energy Solutions, Urban Solutions, Mission Solutions and Other.
The Energy Solutions segment’s revenues grew 16.6% year over year to $1,592 million for the quarter. The segment reported a profit of $59 million, down from $72 million a year ago. New awards came in at $3,574 million in the quarter, up from $644 million in the third quarter of 2021. The backlog at quarter-end was $10.18 billion compared with $9.32 billion at 2021-end.
Revenues in the Urban Solutions segment totaled $982 million, down 3.3% on a year-over-year basis. The segment incurred an operating loss of $54 million versus earnings of $18 million a year ago. New awards came in at $929 million for the quarter, up from $781 million a year ago. The backlog at quarter-end was $7.59 billion, up from $7.05 billion at 2021-end.
Revenues in the Mission Solutions segment totaled $639 million, down 11.6% on a year-over-year basis. The segment reported a profit of $29 million compared with $28 million a year ago. It booked new awards worth $4,874 million, up from $1,610 million a year ago. The backlog at quarter-end was $6.19 billion compared with $2.56 billion at 2021-end.
The Other segment — comprising NuScale — generated revenues of $399 million for the quarter versus $400 million in the year-ago period. This segment generated a loss of $3 million versus $2 million a year ago. It booked new awards worth $366 million, same as the year-ago quarter. The backlog at quarter-end was $1.46 billion compared with $1.87 billion at 2021-end.
Guidance
For the fourth quarter of 2022, Fluor expects adjusted earnings per share in the range of 50-60 cents. It expects adjusted EBITDA in the range of $125 to $150 million.
The consensus mark for the same is currently pegged at 46 cents per share.
Zacks Rank
Fluor currently has a Zacks Rank #5 (Strong Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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KBR, Inc. (KBR - Free Report) reported third-quarter 2022 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same.
Nonetheless, the increasing global importance of national security, energy security, energy transition and climate change have been acting as major tailwinds for KBR.
EMCOR Group, Inc. (EME - Free Report) reported third-quarter 2022 results, wherein earnings and revenues surpassed the Zacks Consensus Estimate and increased year over year.
Given the solid momentum of the business activity amid a challenging macroeconomic environment, the company has lifted its revenues and earnings per share guidance for 2022.
United Rentals, Inc. (URI - Free Report) reported third-quarter 2022 results, wherein earnings surpassed the Zacks Consensus Estimate but revenues missed the same. The company has been gaining from the sustained demand in its end markets and the strength of its core rental business.
URI also lifted its full-year guidance for total revenues and adjusted EBITDA, given broad-based end-market activity, contractor backlogs, customer sentiment and solid visibility.