KBR, Inc. (KBR - Free Report) has received the first commercial contract for its Propane Dehydrogenation (“PDH”) Technology, K-PRO. Notably, the technology — which was introduced in January 2019 — will be utilized for a 600-kTA PDH plant by one of its clients in Asia.
This innovative and environmental-friendly technology, which is based on KBR's catalytic olefins technology K-COT, provides high propylene selectivity and conversion. Also, it employs KBR's well-proven Orthoflow Fluidized Catalytic Cracking reactor technology.
Markedly, K-PRO allows facilities to operate for longer periods of time between shutdowns, with low capital and operating costs compared with existing commercially available technologies.
Solid Growth in Technology Solutions Business
The company’s Technology Solutions unit has excellent opportunities. During third-quarter 2019, the segment’s revenues increased 18.5% year over year on the back of strong execution across chemical, petrochemical, refining and ammonia projects. Also, higher proprietary equipment sales contributed to the upside.
On a further encouraging note, the segment booked $474-million contract backlog at the end of the third quarter. KBR expects thriving global technology opportunities — led by ammonia, refining and olefins projects — to persist.
Notably, KBR is the only license holder of polycarbonate technology, which positions it pretty well for future expansion. The segment continues to perform well in recent times, driven by refining and petrochemicals projects in China, India and Africa, as well as strong technologies demand.
In the first, second and third quarters of 2019, the segment recorded 48%, 29% and 19% organic growth, respectively. The results were primarily backed by rising demand for its innovative solutions across chemical, petrochemical and refining markets, as well as increased bundling of technology licenses with ancillary services, proprietary equipment and catalysts.
Additionally, the company acquired RRT Global’s isomerization technologies in August 2019, in order to offer more octane and clean fuel technology solutions to customers.
Owing to solid performance across businesses, shares of KBR have surged 79% in the past year compared with its Zacks Engineering - R And D Services industry’s 20.7% rally. Notably, the company is banking on strength across businesses to optimize growth potential. Also, steady backlog growth is adding to KBR’s bliss.
Importantly, the company expects broad-based growth across all its segments, going forward. Primary growth drivers include high-end and differentiated government business work, strong margin performance, and the technology and consulting business.
KBR — which shares space with Gates Industrial Corporation plc (GTES - Free Report) , Quanta Services, Inc. (PWR - Free Report) and AECOM (ACM - Free Report) in the same industry — currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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