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KBR Wins New Contract for Indorama's Nigerian Ammonia Plant

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KBR, Inc.(KBR - Free Report) recently won a new contract from Toyo Engineering Corporation (Toyo) and Indorama Eleme Fertilizer & Chemicals Limited (Indorama), for an undisclosed amount.

Per the deal, the company will provide its premium patented catalyst and equipment, technology licensing and basic engineering design services for the new ammonia plant of Indorama, located at the Port Harcourt site of Nigeria.

The aggregate revenues related with the project were booked into KBR’s Technology & Consulting Business segment’s backlog of unfilled orders in fourth-quarter 2017 (results not yet released).

KBR is recognized as a renowned ammonia technology leader, and has offered designing, licensing, engineering and construction services in more than 100 restoration ammonia projects, and 230 basic ammonia plants. We believe the company will make use of its long-standing experience and expertise to efficiently accomplish services for the Indorama project.

Our Take

The U.S. construction market is currently strengthening on the back of President Trump’s impetus to boost infrastructure spending and business-friendly regulatory environment in the country. However, advanced growth opportunities have enhanced business rivalry among the major construction service providing behemoths. In order to arrest a wider market share and win over peers like Jacobs Engineering Group Inc. (JEC - Free Report) , AECOM (ACM - Free Report) and Altair Engineering Inc. (ALTR - Free Report) ; KBR is currently boosting its competency with robust growth drivers.

The company’s diverse business portfolio enables it to combat cyclicality associated with any single market. Its Government Services business has been witnessing stellar growth and the company believes recent acquisitions will accelerate growth momentum of this business in the near term also. Moreover, KBR’s Consulting business is also experiencing increased activity, indicating potential opportunities in future engineering and construction projects. Also, the company’s high backlog level indicates its underlying strength.

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