Fluor Cuts Outlook on Canceled Project

Fluor reports strong quarterly earnings, but trims its outlook after a big project gets canceled and its contract backlog declines.
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A large canceled refinery project in Kuwait forced

Fluor

(FLR) - Get Report

to trim its earnings forecasts for 2009 -- and judging from the company's backlog numbers, overall business is declining slightly as well.

Fluor said the value of the projects it won during the first quarter totaled $5.5 billion. In the year-earlier period, it won $5.7 billion worth.

Unsurprisingly, the company suggested that the economy was to blame for the slipping numbers. "I'm very encouraged by Fluor's ability to deliver solid results in an increasingly difficult market environment," the company's chairman and chief executive, Alan Boeckmann, said in a statement.

Total backlog also fell. As of the end of the quarter, it stood at about $29 billion. That's down 7% from a year ago and 12% from its fourth-quarter total of $33.2 billion.

The Irving, Texas, company said the Kuwaiti project was worth $2.1 billion. It now expects EPS for the year to come in at $3.80 to $4.10, down from a previous forecast of $3.90 to $4.20. That's still better than analysts' targets of $3.76 a share.

Those downer notes came amid an otherwise sanguine first-quarter earnings report. The company's profit in the period -- $1.21 a share -- surpasses analysts' per-share estimates by 28 cents and amounts to a 50% gain over the year-ago period.

The big winner in the quarter was the company's industrial and infrastructure segment, where revenue jumped 48% to $1.2 billion. The reason for that strong performance was somewhat obscure. The company cited "higher pass-through costs on certain mining and infrastructure contracts." It wasn't more specific.

Flour's oil and gas division also did well. Revenue there jumped 29% to $3.4 billion.

Shares of the company were moving in after-market action at $44.51, up 3%.

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