Fluor Stock Soars As Q2 Results Surpass Street Estimates, Raises FY23 Guidance

Fluor Corp FLR reported a second-quarter FY23 revenue growth of 19.4% year-over-year to $3.94 billion, beating the consensus of $3.61 billion.

Sales by segment: Energy Solutions $1.72 billion (+29.4% Y/Y), Urban Solutions $1.20 billion (+6% Y/Y), Mission Solutions $705 million (+28.9% Y/Y) and Others $311 million (+8% Y/Y).

FLR recorded a total segment profit of $191 million, compared to a profit of $108 million in 2Q22, margin expanded to 4.8% from 3.3%.

Q2 net earnings attributable to Fluor was $61 million (-7.6% Y/Y), reflecting strong performance from Energy Solutions and Urban Solutions. 

Adjusted EPS improved to $0.76 from $0.15 in 2Q22, beating the consensus of $0.36.

Adjusted EBITDA jumped by 166.2% Y/Y to $181 million, and the margin expanded by 253 bps to 4.6%.

New awards in Q2 totaled $753 million, compared to $1.3 billion in 2Q22. The ending backlog was $7.6 billion compared to $8.4 billion a year ago.

At the end of the quarter, Fluor’s cash and marketable securities were $2.1 billion.

FLR revised its FY23 guidance based on the strong underlying performance of its non-legacy portfolio and achieving as-sold margins on large Energy Solutions projects.

FY23 Outlook: Fluor raises its FY23 Adjusted EPS Guidance from $1.50-$1.90 to $2.00-$2.30 versus consensus of $1.74.

FLR tightens FY23 adjusted EBITDA guidance from $450 million-$600 million to $500 million -$600 million.

The company reaffirms its FY26 outlook, adjusted EPS of $3.10-$3.60, and Adjusted EBITDA of $800 million-$950 million.

Price Action: FLR shares traded higher by 16.2% at $36.13 on the last check Friday.