Fluor Delivers Mixed Q2 Results, CEO Confident In Growth Strategy And Shareholder Returns

Fluor Corp FLR reported second-quarter fiscal 2024 revenue growth of 7.3% year over year to $4.227 billion, missing the consensus of $4.360 billion.

Sales by segment: Energy Solutions $1.595 billion (-7.3% Y/Y), Urban Solutions $1.83 billion (+52.3% Y/Y), Mission Solutions $704 million (-0.14% Y/Y) and Others $97 million (-68.8% Y/Y).

FLR recorded a total segment profit of $194 million, compared to $191 million a year ago. The margin contracted 20 bps to 4.6%.

Adjusted EPS improved to $0.85 from $0.76 a year ago, beating the consensus of $0.68.

The company reported net earnings from core operations of $169 million, up from $46 million a year ago.

The total new awards were $3.1 billion compared to $3.7 billion a year ago. Ending consolidated backlog increased 9.7% Y/Y to $32.3 billion, 81% reimbursable.

Adjusted EBITDA declined to $165 million from $181 million, and the margin declined 70 bps to 3.9%.

At the end of the quarter, Fluor’s cash and marketable securities were $2.6 billion, excluding amounts held by NuScale.

Operating cash flow for the six months ended June 30 stood at $171 million, with the 2024 cash guidance range increased to $500 million to $600 million.

“Our quarterly results demonstrate that our strategy is working, thereby ensuring targeted market growth and project execution excellence. For the second half of 2024, our focus will be on deploying resources onto our high-value project backlog and positioning the company to return capital to shareholders,” commented David E. Constable, Fluor’s chairman and chief executive officer.

2024 Outlook: FLR reaffirmed its adjusted EPS of $2.50 to $3.00 versus $2.85 the consensus. The company tightens its adjusted EBITDA guidance from $600 million – $700 million to $625 million – $675 million.

Price Action: FLR shares are trading lower by 0.99% at $47.00 premarket at the last check Friday.