The Babcock & Wilcox Company (NYSE: BWC) (“B&W” or the “Company”) today reported revenues for the first quarter of 2011 were $691.3 million, an increase of $28.9 million or 4.4% from the first quarter of 2010. Net income for the first quarter of 2011 was $13.5 million compared to $16.8 million in the first quarter of 2010. Included in net income for the first quarter of 2011 is the impact of unfavorable adjustments for loss contracts of approximately $20.0 million on an after-tax basis. The resulting earnings per share for the first quarter ended March 31, 2011 were $0.11 compared to $0.14 in the first quarter of 2010.

Recent Highlights
  • Awarded $668 million waste-to-energy power plant construction contract and $235 million 10-year operations & maintenance contract
  • Awarded $30 million renewable energy power generation contract in Sweden
  • Received $5 million grant for small modular reactor testing facility
  • Achieved record bookings of power generation aftermarket parts
  • Industrial MACT rules finalized; draft utility boiler MACT rules released
  • Broke ground on an ultra supercritical boiler manufacturing facility in India
  • Announced B&W is in discussions to provide nuclear technical assistance and services to the Fukushima Daiichi nuclear power plant in Japan
  • Named Peyton S. Baker President of Babcock & Wilcox Nuclear Operations Group, Inc.
  • Named Ali Azad President and Chief Executive Officer of Generation mPower LLC

Consolidated Results of Operations

Consolidated revenues for the first quarter of 2011 were $691.3 million, an increase of $28.9 million or 4.4% from the first quarter of 2010. This increase was across all business segments. Operating income for the first quarter of 2011 was $21.9 million compared to $38.7 million in the first quarter of 2010. Included in the first quarter 2011 operating income was the impact of unfavorable adjustments for loss contracts of $11.1 million and $21.6 million in the Nuclear Operations and Nuclear Energy segments, respectively. As of March 31, 2011, we operate in four reportable business segments: Power Generation, Nuclear Operations, Nuclear Energy and Technical Services. We discuss the change in reportable business segments further below.

Power Generation Segment

Revenues of $356.2 million for the first quarter of 2011 were approximately flat compared to the $355.9 million reported in the first quarter of 2010. This result was principally related to increased volumes of construction service projects and environmental aftermarket services offset by a decline in demand for new-build environmental systems. Operating income was $26.6 million in the first quarter of 2011, an increase of $5.9 million, or 28.5% compared to $20.7 million in the first quarter of 2010. This represents an operating margin of 7.5%, an increase of 170 basis points from the prior year first quarter. The increase in operating income is principally related to the strong aftermarket service and replacement parts businesses and higher year-over-year royalty fees from international licensees.

“We are positioning the business for the expected continued growth in demand for coal-fired power generation in Asia and resumption of growth in the U.S., which is expected to improve as a result of several factors,” said Brandon C. Bethards, President and Chief Executive Officer of B&W. “First, key leading indicators such as power consumption would suggest that utilities will need to increase their level of spending with respect to the maintenance of their assets in an effort to maintain or improve availability and capacity factors. Second, the Company continues to experience improvements in its small parts and service businesses, traditionally good leading indicators for future utility investment. Third, the U.S. Environmental Protection Agency has issued final rules with respect to industrial boiler maximum achievable control technology (“MACT”) and has issued draft rules for utility boiler MACT. These events are important factors that we believe are leading our utility customers to buy testing programs and engineering studies to assess and plan for capital requirements to achieve compliance with the rules.”

Nuclear Operations Segment

Revenues of $250.5 million increased $16.2 million or 6.9% in the first quarter of 2011 compared to the first quarter of 2010. This increase is principally the result of an increase in activity for naval nuclear reactor components and nuclear fuel. Operating income of $30.5 million increased $6.0 million or 24.5% in the first quarter of 2011 compared to the first quarter of 2010. This increase is principally related to productivity and project execution improvement on the production of nuclear reactor components partially offset by costs at Nuclear Fuel Services, Inc. (“NFS”). The increased costs at NFS were due to processing challenges and unfavorable revised throughput estimates on several downblending contracts in place at the time of the acquisition of NFS. During the first quarter, NFS began a first-of-a-kind downblending operation on certain uranium oxide materials, which represents approximately the last 2% of the total contract volume of material on a commercial contract that NFS had entered into in February 2002. Initial processing of this material in the first quarter of 2011 resulted in achievement of approximately half of the expected throughput rate, which had been established based on laboratory testing. Due to the high fixed-cost nature of NFS, this resulted in one-time costs of $11.1 million on several downblending contracts due to increased manhour estimates and downstream production scheduling inefficiencies for the period. “At recently improved run rates, we expect this material to be fully processed in approximately 60 days from today. We have taken steps to re-evaluate the balance of the material and adequately reserved for the remainder of the loss contract, containing the issue to the first quarter of 2011. Additionally, we expect NFS will produce positive operating results for the full year. Inclusive of the unacceptable results at NFS, the consolidated Nuclear Operations segment was able to deliver a 24% year-over-year increase in operating earnings on the continuing strength of the nuclear component business,” Bethards said.

Nuclear Energy Segment

Revenues of $65.3 million increased $9.3 million or 16.6% in the first quarter of 2011 compared to the first quarter of 2010. The increase in revenues is due principally to the success achieved supplying commercial nuclear components and volume associated with nuclear project contracts. Operating loss of $37.5 million increased $26.1 million in the first quarter of 2011 compared to the first quarter of 2010. This loss includes $15.9 million of research and development and selling, general and administrative expenses related to the B&W mPower TM modular nuclear reactor program and $21.6 million for a loss contract for a nuclear projects contract. This loss contract was bid and awarded in 2009. As substantial field-work began in late March 2011, the Company became aware that the estimated cost of the project did not adequately reflect the actual scope and complexities of the work proposed under the contract. The Company has made an in-depth review of this project and has fully reserved for the expected loss on this contract in the first quarter of 2011. “I am confident that we have contained this issue to the first quarter of 2011 and that the current bid processes and contract procedures will help prevent this type of cost estimating misalignment from occurring in the future. There is an opportunity to improve the results of this contract in future quarters from a combination of claims and change orders resulting from customer-driven changes in scope and scheduling delays associated with out-of-scope site conditions. Further-more, executive management will maintain their intervention in this contract until successfully completed. Finally, we have reviewed our existing backlog in-depth and we are confident that we do not have any other fixed price contracts in our nuclear projects business unit that could produce such an unfavorable result,” Bethards said.

As expected, total expenses related to the B&W mPower reactor program have increased in the last several months principally as a result of the accelerated commercial activities of the program. Recent events at the Fukushima Daiichi plant in Japan have led to considerable discussion and speculation about the impact to commercial nuclear markets. All indications received by the Company from prospective customers and regulatory and governmental agencies are that programs related to modular nuclear reactor technology are continuing as planned. “In fact, we are experiencing an increase in potential customer interest in our technology partially due to the inherent safety features of the B&W mPower unit compared to the large-scale nuclear units operating in the market today. This interest is both from U.S. utilities as well as utilities and governments outside of the U.S.,” Bethards said.

Technical Services Segment

Revenues of $28.4 million increased $8.8 million or 44.9% in the first quarter of 2011 compared to the first quarter of 2010. Operating income, including the Company’s portion of income from unconsolidated entities recorded as equity income, of $12.1 million increased $1.4 million or 13.3% in the first quarter of 2011 compared to the first quarter of 2010. This increase in operating income is due principally to new contracts received in the second half of 2010 that were beginning to ramp up in late 2010 and early 2011. The largest contract awarded to B&W recently, the $2.1 billion Department of Energy (“DOE”) decontamination and decommissioning contract for the Portsmouth Gaseous Diffusion Plant in Ohio, began operation early in the second quarter of 2011 and will ramp up to full-scale operations over the next several quarters.

Liquidity

The Company’s cash and investments position, net of debt, was $375.3 million at the end of the first quarter of 2011 compared to $472.9 million at the end of the fourth quarter of 2010, a decrease of $97.6 million. During the quarter, the Company made cash contributions for 2010 incentive compensation programs and made approximately $44 million in contributions to its pension plans. In addition to net cash, the Company maintains a $700 million revolving credit agreement with approximately $473 million of availability as of the end of the first quarter. The Company continues to maintain adequate liquidity to fund operations, which could include increased working capital requirements, internal growth and R&D programs, as well as additional product and geographic expansion opportunities.

Change in Reported Business Segments

Prior to the first quarter of 2011, the Company operated in two business segments. During the first quarter of 2011, consistent with the methodology to assess operating performance and allocate resources, as well as to provide investors with greater transparency, the Company revised its segment structure. The new segment structure divides the former Power Generation Systems segment into the Power Generation and Nuclear Energy segments, and divides the former Government Operations segment into the Nuclear Operations and Technical Services segments. This change in our business segment structure had no effect on our previously reported consolidated and combined results of operations, financial position or cash flows. In connection with this change we have reclassified historical amounts to conform to our current segment presentation. Attached to this press release is reclassified unaudited quarterly segment information for 2010 and 2009, which may be adjusted, based on audit results.

Description of Reported Business Segments

Power Generation segment - supplies boilers fired with fossil fuels, such as coal, oil and natural gas, or renewable fuels such as biomass, municipal solid waste and concentrated solar energy. In addition to carbon capture technologies, we supply environmental equipment and components and related services to customers in different regions around the world. We design, engineer, manufacture, supply, construct and service large utility and industrial power generation systems, including boilers used to generate steam in electric power plants, pulp and paper making, chemical and process applications and other industrial uses.

Nuclear Energy segment - designs and manufactures commercial nuclear power equipment, including nuclear heat exchangers and steam generators, and provides outage related inspection, maintenance and construction services for nuclear generating stations around the world. This segment includes the operations of the B&W mPower modular nuclear reactor program.

Nuclear Operations segment - manufactures naval nuclear reactors for the U.S. DOE /National Nuclear Security Administration (“NNSA”) Naval Nuclear Propulsion Program and supplies them to the U.S. Navy for use in submarines and aircraft carriers.

Technical Services segment - provides various services to the U.S. Government, including uranium processing, environmental site restoration services and management and operating services for various U.S. Government-owned facilities. These services are provided to the DOE, including the NNSA, the Office of Nuclear Energy, the Office of Science and the Office of Environmental Management. The Company’s participation in the American Centrifuge Project is also included in this segment.

Conference Call to Discuss First Quarter 2011 Results

Date: Tuesday, May 10, 2011, at 8:30 a.m. ET Live Webcast: Investor Relations section of website at www.babcock.com

Forward-Looking Statements

B&W cautions that this release contains forward-looking statements, including, without limitation, statements relating to our confidence that we have contained the losses on the nuclear projects contracts, expectation for growth in demand for power generation in Asia and resumption of growth in the U.S., the expected impact and implication of power consumption, positive trends in certain areas of our business and issuance of MACT rules on demand, and the anticipated improvement of certain run rates at NFS. These forward-looking statements are based on current management expectations and involve a number of risks and uncertainties, including, among other things, adverse changes in the industries in which we operate, including adverse affects of the earthquake and tsunami in Japan in March 2011 and our ability to execute on contracts in backlog. If one or more of these or other risks materialize, actual results may vary materially from those expected. For a more complete discussion of these and other risk factors, please see B&W’s filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2010. B&W cautions not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and undertakes no obligation to update or revise any forward-looking statement, except to the extent required by applicable law.

About B&W

The Babcock & Wilcox Company is a leader in clean energy technology and services, primarily for the nuclear, fossil and renewable power markets as well as a premier advanced technology and mission critical defense contractor. B&W has locations worldwide and employs approximately 12,000 people, in addition to approximately 10,000 joint venture employees. A company overview presentation, which will be presented at investor conferences and meetings throughout this quarter, is available on the Investor Relations section of our website. For additional information please visit our website at www.babcock.com .

TABLES TO FOLLOW

THE BABCOCK & WILCOX COMPANYCONDENSED CONSOLIDATED BALANCE SHEETS
   

ASSETS
 
March 31, December 31,
2011 2010
(Unaudited)
(In thousands)
 
 
Current Assets:
Cash and cash equivalents $ 292,181 $ 391,142
Restricted cash and cash equivalents 12,551 12,267
Investments - 234
Accounts receivable – trade, net 307,657 289,374
Accounts receivable – other 72,217 64,231
Contracts in progress 282,554 225,448
Inventories 100,194 100,932
Deferred income taxes 85,597 90,620
Other current assets     72,935     34,868
 
Total Current Assets     1,225,886     1,209,116
 
Property, Plant and Equipment 988,914 968,712
Less accumulated depreciation     568,655     550,400
 
Net Property, Plant and Equipment     420,259     418,312
 
Investments     75,493     74,863
 
Goodwill     271,024     269,424
 
Deferred Income Taxes     226,477     236,504
 
Investments in Unconsolidated Affiliates     110,998     100,811
 
Other Assets     181,973     191,480
 
TOTAL   $ 2,512,110   $ 2,500,510
 

THE BABCOCK & WILCOX COMPANYCONDENSED CONSOLIDATED BALANCE SHEETS
   

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
March 31, December 31,
2011 2010
(Unaudited)
(In thousands)
 
 
Current Liabilities:
Notes payable and current maturities of long-term debt $ 4,066 $ 4,790
Accounts payable 188,805 185,240
Accrued employee benefits 188,595 235,856
Accrued liabilities – other 87,113 71,242
Advance billings on contracts 385,270 369,644
Accrued warranty expense 109,082 109,588
Income taxes payable     4,876       5,467  
 
Total Current Liabilities     967,807       981,827  
 
Long-Term Debt     854       855  
 
Accumulated Postretirement Benefit Obligation     84,531       84,100  
 
Environmental Liabilities     45,404       40,889  
 
Pension Liability     555,407       579,000  
 
Other Liabilities     97,818       100,314  
 
Commitments and Contingencies
 
Stockholders’ Equity:        

Common stock, par value $0.01 per share, authorized 325,000,000 shares; issued 117,768,007 and 116,963,664 shares at March 31, 2011 and December 31, 2010, respectively
1,178 1,170

Preferred stock, par value $0.01 per share, authorized 75,000,000 shares; No shares issued

-

-
Capital in excess of par value 1,082,062 1,067,414
Retained earnings 110,181 96,671
Treasury stock at cost, 262,115 and 101,649 shares at March 31, 2011 and December 31, 2010, respectively (7,929 ) (2,397 )
Accumulated other comprehensive loss     (426,062 )     (449,999 )
Stockholders’ Equity – The Babcock & Wilcox Company 759,430 712,859
Noncontrolling interest     859       666  
Total Stockholders’ Equity     760,289       713,525  
 
TOTAL   $ 2,512,110     $ 2,500,510  
 

THE BABCOCK & WILCOX COMPANY CONDENSED CONSOLIDATED AND COMBINED
 

STATEMENTS OF INCOME
 
Three Months Ended
March 31,

2011
 

2010
(Unaudited)
(In thousands, except share and per share amounts)
 

Revenues
 

$

691,277
   

$

662,388
 

Costs and Expenses:

Cost of operations

564,806

527,892

Research and development costs

17,308

17,059

Gains on asset disposals and impairments – net

(10

)

(13

)

Selling, general and administrative expenses
   

102,633
     

92,723
 

Total Costs and Expenses
   

684,737
     

637,661
 
 

Equity in Income of Investees
   

15,361
     

14,019
 
 

Operating Income
   

21,901
     

38,746
 
 

Other Income (Expense):

Interest income

459

449

Interest expense

(455

)

(5,993

)

Other expense – net
   

(2,994

)
   

(3,090

)

Total Other Expense
   

(2,990

)
   

(8,634

)
 

Income before Provision for Income Taxes

18,911

30,112
 

Provision for Income Taxes
   

5,244
     

13,256
 
 

Net Income
 

$

13,667
   

$

16,856
 
 

Less: Net Income Attributable to Noncontrolling Interest
   

(157

)
   

(13

)
 

Net Income Attributable to The Babcock & Wilcox Company
 

$

13,510
   

$

16,843
 
 

Earnings per Common Share:

Basic:

Net Income Attributable to The Babcock & Wilcox Company

$

0.12

$

0.15

Diluted:

Net Income Attributable to The Babcock & Wilcox Company
 

$

0.11
   

$

0.14
 
 

Shares used in the computation of earnings per share:

Basic

116,968,275

116,067,535

Diluted
   

117,957,245
     

117,423,807
 
 

THE BABCOCK & WILCOX COMPANYCONDENSED CONSOLIDATED AND COMBINED STATEMENTS OF CASH FLOWS
 
Three Months Ended
March 31,

2011
 

2010
(Unaudited)
(In thousands)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Income   $ 13,667     $ 16,856  
Non-cash items included in net income:
Depreciation and amortization 19,315 16,812
Income of investees, net of dividends (3,832 ) (8,758 )
Gain on asset disposals – net (10 ) (13 )
Amortization of pension and postretirement costs 20,474 21,420
Excess tax benefits from stock-based compensation (4,031 ) (1,908 )
Other, net 1,097 723
Changes in assets and liabilities, net of effects of acquisitions:
Accounts receivable (31,213 ) 15,624
Net contracts in progress and advance billings on contracts (44,328 ) (96,575 )
Accounts payable 6,016 36,836
Inventories 1,536 2,372
Income taxes receivable 13,562 (313 )
Current and deferred income taxes 21,479 (12,053 )
Accrued and other current liabilities 8,535 13,117
Pension liability, accumulated postretirement benefit obligation and accrued employee benefits (71,633 ) (47,139 )
Prepaid expenses (37,957 ) (3,494 )
Other, net     5,750       961  
NET CASH USED IN OPERATING ACTIVITIES     (81,573 )     (45,532 )
CASH FLOWS FROM INVESTING ACTIVITIES:
Increase in restricted cash and cash equivalents (284 ) (2,516 )
Purchases of property, plant and equipment (20,753 ) (18,763 )
Acquisition of businesses, net of cash acquired - (8,165 )
Purchases of available-for-sale securities (48,791 ) (20,143 )
Sales and maturities of available-for-sale securities 48,577 22,882
Investment in equity and cost method investees (4,716 ) -
Proceeds from asset disposals     17       79  
NET CASH USED IN INVESTING ACTIVITIES     (25,950 )     (26,626 )
CASH FLOWS FROM FINANCING ACTIVITIES:
Payment of short-term borrowing and long-term debt (797 ) (150 )
Payment of debt issuance costs (70 ) -
Increase in notes payable to affiliates - 20
Excess tax benefits from stock-based compensation 4,031 1,908
Exercise of stock options     3,105       -  
NET CASH PROVIDED BY FINANCING ACTIVITIES     6,269       1,778  
EFFECTS OF EXCHANGE RATE CHANGES ON CASH     2,293       2,036  
NET DECREASE IN CASH AND CASH EQUIVALENTS (98,961 ) (68,344 )
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD     391,142       469,468  
CASH AND CASH EQUIVALENTS AT END OF PERIOD   $ 292,181     $ 401,124  
 
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION:
Cash paid during the period for:
Interest (net of amount capitalized) $ 892 $ 5,993
Income taxes (net of refunds) $ 13,903 $ 5,502
 

The Babcock & Wilcox Company
Business Segment Information
For the Periods Ended March 31, 2011 and 2010
(In thousands of U.S. dollars)
     
THREE MONTHS ENDED

REVENUES:

3/31/11

3/31/10
 
Power Generation $ 356,184 $ 355,944
Nuclear Operations 250,455 234,295
Technical Services 28,360 19,629
Nuclear Energy 65,262 55,965
Adjustments and Eliminations     (8,984 )     (3,445 )
 
  TOTAL   $ 691,277     $ 662,388  
 

SEGMENT INCOME:
 
Power Generation $ 26,633 $ 20,703
Nuclear Operations 30,450 24,500
Technical Services 12,142 10,712
Nuclear Energy     (37,478 )     (11,402 )
31,747 44,513
Corporate   (9,846 )     (5,767 )
  OPERATING INCOME   $ 21,901     $ 38,746  
 

EQUITY IN INCOME (LOSS) OF INVESTEES:
 
Power Generation $ 6,010 $ 4,541
Nuclear Operations - -
Technical Services 9,351 9,478
Nuclear Energy     -       -  
 
  TOTAL   $ 15,361     $ 14,019  
 

PENSION EXPENSE:
 
Power Generation $ 15,928 $ 15,092
Nuclear Operations 8,946 9,725
Technical Services 634 610
Nuclear Energy 1,181 920
Corporate     1,680       6,048  
 
  TOTAL   $ 28,369     $ 32,395  
 

DEPRECIATION AND AMORTIZATION:
 
Power Generation $ 4,720 $ 3,788
Nuclear Operations 10,391 9,102
Technical Services 66 66
Nuclear Energy 1,181 1,262
Corporate     2,957       2,594  
 
  TOTAL   $ 19,315     $ 16,812  
 

RESEARCH AND DEVELOPMENT, NET:
 
Power Generation $ 2,994 $ 7,640
Nuclear Operations 11 4
Technical Services 0 56
Nuclear Energy     14,303       9,359  
 
  TOTAL   $ 17,308     $ 17,059  
 

CAPITAL EXPENDITURES:
 
Power Generation $ 4,139 $ 2,917
Nuclear Operations 11,766 7,899
Technical Services 0 0
Nuclear Energy 2,463 117
Corporate     2,385       7,830  
 
  TOTAL   $ 20,753     $ 18,763  
 

BACKLOG:
 
Power Generation $ 1,500,655 $ 1,653,919
Nuclear Operations 2,931,001 2,769,681
Technical Services 3,009 12,929
Nuclear Energy     471,897       315,443  
 
  TOTAL   $ 4,906,562     $ 4,751,972  
 

The Babcock & Wilcox Company
Business Segment Information
Quarterly Periods of Fiscal Year 2009
(In thousands of U.S. dollars)
Unaudited / Subject to Change
    THREE MONTHS ENDED  

TWELVEMONTHSENDED

REVENUES:

3/31/2009
 

6/30/2009
 

9/30/2009
 

12/31/2009

12/31/2009
 
Power Generation $ 493,733 $ 427,237 $ 353,094 $ 384,159 $ 1,658,223
Nuclear Operations 218,410 229,375 234,184 232,051 914,020
Technical Services 38,994 32,289 25,959 22,298 119,540
Nuclear Energy 35,192 47,452 38,306 53,833 174,783
Adjustments and Eliminations     (1,276 )     (4,284 )     (2,546 )     (3,828 )     (11,934 )
 
  TOTAL   $ 785,053     $ 732,069     $ 648,997     $ 688,513     $ 2,854,632  
 

SEGMENT INCOME:
 
Power Generation $ 59,566 $ 42,473 $ 37,966 $ 23,310 $ 163,315
Nuclear Operations 29,611 43,651 9,747 24,259 107,268
Technical Services 12,628 11,556 9,577 13,551 47,312
Nuclear Energy     (1,406 )     1,364       (3,764 )     (1,641 )     (5,447 )
100,399 99,044 53,526 59,479 312,448
Corporate (5,091 ) (8,477 ) (7,408 ) (21,908 ) (42,884 )
  OPERATING INCOME   $ 95,308     $ 90,567     $ 46,118     $ 37,571     $ 269,564  
 

EQUITY IN INCOME (LOSS) OF INVESTEES:
 
Power Generation $ 1,643 $ 1,501 $ 4,565 $ 6,334 $ 14,043
Nuclear Operations - - - - -
Technical Services 8,702 8,652 9,081 14,616 41,051
Nuclear Energy     -       -       -       -       -  
 
  TOTAL   $ 10,345     $ 10,153     $ 13,646     $ 20,950     $ 55,094  
 

PENSION EXPENSE:
 
Power Generation $ 14,582 $ 14,784 $ 16,078 $ 15,062 $ 60,506
Nuclear Operations 10,054 10,054 11,144 10,602 41,854
Technical Services 637 638 674 650 2,599
Nuclear Energy 733 625 615 1,117 3,090
Corporate     6,057       6,047       6,542       6,172       24,818  
 
  TOTAL   $ 32,063     $ 32,148     $ 35,053     $ 33,603     $ 132,867  
 

DEPRECIATION AND AMORTIZATION:
 
Power Generation $ 3,241 $ 3,492 $ 3,264 $ 3,354 $ 13,351
Nuclear Operations 9,142 8,544 15,287 11,611 44,584
Technical Services 408 43 (240 ) 67 278
Nuclear Energy 1,093 1,128 1,180 1,107 4,508
Corporate     2,379       2,470       2,759       2,383       9,991  
 
  TOTAL   $ 16,263     $ 15,677     $ 22,250     $ 18,522     $ 72,712  
 

RESEARCH AND DEVELOPMENT, NET:
 
Power Generation $ 7,858 $ 7,869 $ 8,079 $ 8,782 $ 32,588
Nuclear Operations 281 231 232 165 909
Technical Services 309 204 775 414 1,702
Nuclear Energy     1,535       2,240       3,507       10,765       18,047  
 
  TOTAL   $ 9,983     $ 10,544     $ 12,593     $ 20,126     $ 53,246  
 

CAPITAL EXPENDITURES:
 
Power Generation $ 12,324 $ 7,260 $ 5,030 $ 5,643 $ 30,257
Nuclear Operations 3,043 7,748 6,181 8,778 25,750
Technical Services 7 19 0 0 26
Nuclear Energy 10 578 0 1,303 1,891
Corporate     4,645       4,619       15,191       11,346       35,801  
 
  TOTAL   $ 20,029     $ 20,224     $ 26,402     $ 27,070     $ 93,725  
 

BACKLOG:
 
Power Generation $ 1,988,360 $ 1,999,646 $ 1,846,032 $ 1,637,888 $ 1,637,888
Nuclear Operations 2,692,031 2,606,140 2,537,223 2,761,435 2,761,435
Technical Services 6,549 7,392 2,029 5,010 5,010
Nuclear Energy     232,157       222,320       215,805       335,727       335,727  
 
  TOTAL   $ 4,919,097     $ 4,835,498     $ 4,601,089     $ 4,740,060     $ 4,740,060  
 

The Babcock & Wilcox Company
Business Segment Information
Quarterly Periods of Fiscal Year 2010
(In thousands of U.S. dollars)
Unaudited / Subject to Change
    THREE MONTHS ENDED  

TWELVEMONTHSENDED

REVENUES:

3/31/2010
 

6/30/2010
 

9/30/2010
 

12/31/2010

12/31/2010
 
Power Generation $ 355,944 $ 369,320 $ 336,107 $ 363,204 $ 1,424,575
Nuclear Operations 234,295 246,922 243,592 271,160 995,970
Technical Services 19,629 20,826 22,008 27,478 89,941
Nuclear Energy 55,965 57,747 34,715 47,855 196,282
Adjustments and Eliminations     (3,445 )     (6,319 )     (3,657 )     (4,535 )     (17,957 )
 
  TOTAL   $ 662,388     $ 688,496     $ 632,765     $ 705,162     $ 2,688,811  
 

SEGMENT INCOME:
 
Power Generation $ 20,703 $ 42,115 $ 31,591 $ 33,869 $ 128,278
Nuclear Operations 24,500 40,680 43,869 38,186 147,235
Technical Services 10,712 12,604 9,833 12,465 45,614
Nuclear Energy     (11,402 )     (2,281 )     (11,200 )     (2,677 )     (27,560 )
44,513 93,118 74,093 81,843 293,567
Corporate (5,767 ) (7,463 ) (9,016 ) (7,349 ) (29,595 )
  OPERATING INCOME   $ 38,746     $ 85,655     $ 65,077     $ 74,494     $ 263,972  
 

EQUITY IN INCOME (LOSS) OF INVESTEES:
 
Power Generation $ 4,541 $ 7,459 $ 7,123 $ 11,665 $ 30,788
Nuclear Operations - - - - -
Technical Services 9,478 9,976 9,863 13,977 43,294
Nuclear Energy     -       -       -       -       -  
 
  TOTAL   $ 14,019     $ 17,435     $ 16,986     $ 25,642     $ 74,082  
 

PENSION EXPENSE:
 
Power Generation $ 15,092 $ 15,072 $ 16,366 $ 15,517 $ 62,047
Nuclear Operations 9,725 9,724 11,566 9,672 40,687
Technical Services 610 609 741 653 2,613
Nuclear Energy 920 889 814 924 3,547
Corporate     6,048       6,049       1,353       1,876       15,326  
 
  TOTAL   $ 32,395     $ 32,343     $ 30,840     $ 28,642     $ 124,220  
 

DEPRECIATION AND AMORTIZATION:
 
Power Generation $ 3,788 $ 3,847 $ 5,350 $ 5,579 $ 18,564
Nuclear Operations 9,102 8,851 10,602 8,400 36,955
Technical Services 66 66 66 65 263
Nuclear Energy 1,262 1,243 1,237 1,245 4,987
Corporate     2,594       2,578       2,348       3,344       10,864  
 
  TOTAL   $ 16,812     $ 16,585     $ 19,603     $ 18,633     $ 71,633  
 

RESEARCH AND DEVELOPMENT, NET:
 
Power Generation $ 7,640 $ 6,228 $ 5,944 $ 5,904 $ 25,716
Nuclear Operations 4 14 6 121 145
Technical Services 56 108 1,674 2,954 4,792
Nuclear Energy     9,359       9,876       9,800       9,479       38,514  
 
  TOTAL   $ 17,059     $ 16,226     $ 17,424     $ 18,458     $ 69,167  
 

CAPITAL EXPENDITURES:
 
Power Generation $ 2,917 $ 3,854 $ 3,267 $ 3,589 $ 13,627
Nuclear Operations 7,899 838 8,493 7,488 24,718
Technical Services 0 0 0 15 15
Nuclear Energy 117 1,084 247 3,032 4,480
Corporate     7,830       7,147       5,090       742       20,809  
 
  TOTAL   $ 18,763     $ 12,923     $ 17,097     $ 14,866     $ 63,649  
 

BACKLOG:
 
Power Generation $ 1,653,919 $ 1,487,148 $ 1,547,184 $ 1,564,352 $ 1,564,352
Nuclear Operations 2,769,681 2,546,287 2,335,434 3,151,354 3,151,354
Technical Services 12,929 7,565 2,683 1,181 1,181
Nuclear Energy     315,443       328,982       474,132       485,005       485,005  
 
  TOTAL   $ 4,751,972     $ 4,369,982     $ 4,359,433     $ 5,201,892     $ 5,201,892  
 

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