KBR, which provides engineering services to the energy sector and the government, said Friday its third-quarter profit rose 35 percent as a newly-acquired business and work on Gulf of Mexico vessels drove sharp revenue increases.
Net income rose to $85 million, or 51 cents per share, in the three months ended Sept. 30 from $63 million, or 37 cents, a year ago. Income from continuing operations totaled 44 cents per share, including Hurricane Ike-related costs of 4 to 5 cents a share.
Revenue climbed 39 percent to $3.02 billion from $2.18 billion, as government and infrastructure projects brought in $193 million more in revenue, and services revenue surged to $539 million from $77 million.
The results appeared to beat estimates of analysts surveyed by Thomson Reuters, who expected a profit of 43 cents per share on revenue of $2.97 billion. The earnings estimates typically exclude one-time items.
Houston-based KBR Inc., which was spun off last year from Halliburton Corp., bought Alabama-based construction contractor BE&K in May for $550 million.
Bill Utt, chairman, president, and chief executive, said the integration of BE&K is "going extremely well."
During the quarter, KBR announced several BE&K projects, such as power transformer manufacturing plant in Georgia a rebuilding a recovery boiler for Weyerhaeuser Co. in Mississippi.
"KBR's long-term prospects across its end-markets remain positive and KBR is well-positioned to capture those opportunities," he said.
Income in the third quarter included a $13 million reversal of a charge related to an unfavorable jury verdict of about $40 million in litigation with a subcontractor on a Logistics Civil Augmentation Program, or LogCap, in the second quarter and positive contributions from Iraq-related activities and other projects.
Corporate general and administrative expenses dropped in the third quarter by 15 percent, to $55 million compared with $65 million in the year-ago period.
