CB&I Reports 2015 First Quarter Results

Significant year-over-year growth in revenue and earnings

News provided by

CB&I

Apr 23, 2015, 04:01 ET

THE WOODLANDS, Texas, April 23, 2015 /PRNewswire/ -- CB&I (NYSE: CBI) today reported net income for the first quarter of $132.2 million, or $1.21 per diluted share, an increase of 40 percent against adjusted net income for the comparable period. Revenues for the first quarter were $3.1 billion, up from $2.9 billion, or 7 percent from the first quarter 2014. New awards for the first quarter totaled $3 billion, which resulted in a backlog of approximately $30 billion.

"CB&I delivered solid first quarter operational and financial performance," said Philip K. Asherman, CB&I's President and Chief Executive Officer. "Revenues experienced some headwinds due to the effects of the strong dollar on our international work, which comprised nearly 40 percent of our revenues this quarter. We maintain confidence in our guidance for the year supported by the continuing development of LNG projects in North America, petrochemical developments on the Gulf Coast, combined cycle power plants in the U.S., and consistent margin performance from our operating groups."

CB&I's earnings for the first quarter include stock-based compensation expense of approximately $32 million, or $0.20 per diluted share. Stock-based compensation expense for the remainder of 2015 is expected to be approximately $14 million, or $0.09 per diluted share, per quarter.

CB&I's first quarter results reflect the company's ability to convert prospects into bookings across its global end markets for each of its business sectors. Noteworthy awards include a third LNG train for the Freeport LNG export terminal, additional fabrication services for our U.S. LNG export facility projects, plant services for a refinery in Texas, a polypropylene technology contract and storage awards for petrochemical developments in the Middle East, storage tanks in South America and Canada, technology and FEED contracts for a delayed coker unit for a refinery in Europe, scope increases from our LNG mechanical erection project in Australia and a variety of technology and fabrication awards globally.

Earnings Conference Call

CB&I will host a webcast on Apr. 23 at 4:00 p.m. Central time (5:00 p.m. Eastern time) to discuss financial and operating results and answer questions from investors. The webcast will be available on the Investor Relations page of www.cbi.com.

About CB&I

CB&I (NYSE:CBI) is the most complete energy infrastructure focused company in the world and a major provider of government services. With 125 years of experience and the expertise of approximately 54,000 employees, CB&I provides reliable solutions while maintaining a relentless focus on safety and an uncompromising standard of quality. For more information, visit www.cbi.com.

Important Information For Investors And Shareholders

Cautionary Statement Regarding Forward-Looking Statements

This press release contains forward-looking statements regarding CB&I and represents our expectations and beliefs concerning future events. These forward-looking statements are intended to be covered by the safe harbor for forward-looking statements provided by the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties. When considering any statements that are predictive in nature, depend upon or refer to future events or conditions, or use or contain words, terms, phrases or expressions such as "achieve," "forecast," "plan," "propose," "strategy," "envision," "hope," "will," "continue," "potential," "expect," "believe," "anticipate," "project," "estimate," "predict," "intend," "should," "could," "may," "might" or similar forward-looking statements, we refer you to the cautionary statements concerning risk factors and "Forward-Looking Statements" described under "Risk Factors" in Item 1A of our Annual Report filed on Form 10-K filed with the SEC for the year ended December 31, 2014, and any updates to those risk factors or "Forward-Looking Statements" included in our subsequent Quarterly Reports on Form 10-Q filed with the SEC, which cautionary statements are incorporated herein by reference.

Chicago Bridge & Iron Company N.V.

Consolidated Statements of Operations

(in thousands, except per share data)






Three Months


Ended March 31,


2015


2014








Revenue

$

3,125,745



$

2,928,132

Cost of revenue

2,755,574



2,626,730

Gross profit

370,171



301,402

% of Revenue

11.8

%


10.3

%








Selling and administrative expense

109,101



119,167

% of Revenue

3.5

%


4.1

%








Intangibles amortization

15,652



16,234

Equity earnings

(4,202)



(4,165)

Other operating expense (income), net

2,822



(384)

Integration related costs

—



8,067

Income from operations

246,798



162,483

% of Revenue

7.9

%


5.5

%








Interest expense

(22,286)



(18,887)

Interest income

2,048



2,060

Income before taxes

226,560



145,656









Income tax expense

(69,811)



(42,910)

Net income

156,749



102,746









Less: Net income attributable to noncontrolling interests

(24,521)



(13,795)

Net income attributable to CB&I

$

132,228



$

88,951









Net income attributable to CB&I per share:






Basic

$

1.22



$

0.83

Diluted

$

1.21



$

0.82









Weighted average shares outstanding:






Basic

108,197



107,677

Diluted

109,261



109,113









Cash dividends on shares:






Amount

$

7,597



$

7,559

Per share

$

0.07



$

0.07



Non-GAAP Supplemental Information

(amounts adjusted to exclude integration related costs) (1)








Adjusted income from operations




$

170,550

Adjusted % of Revenue




5.8

%








Adjusted net income attributable to CB&I




$

94,437

Adjusted net income attributable to CB&I per share (diluted)




$

0.87





(1) The exclusion of integration related costs is a non-GAAP financial measure, which we believe provides users a better indication of our operating performance. See "Reconciliation of Non-GAAP Supplemental Information" table.














Chicago Bridge & Iron Company N.V.

Segment Information

(in thousands)









Three Months Ended March 31,




2015

2014


















% of


% of


NEW AWARDS (1), (2)


Total


Total


Engineering & Construction

$

1,209,407

40%

$

4,494,837

78%


Fabrication Services

927,374

31%

516,729

9%


Technology

77,022

2%

77,446

1%


Capital Services

817,380

27%

708,477

12%


Total

$

3,031,183



$

5,797,489





















% of


% of


REVENUE (2)


Total


Total


Engineering & Construction

$

1,818,586

58%

$

1,686,181

58%


Fabrication Services

637,809

21%

671,911

23%


Technology

99,361

3%

102,573

3%


Capital Services

569,989

18%

467,467

16%


Total

$

3,125,745



$

2,928,132





















% of


% of


INCOME FROM OPERATIONS (2)


Revenue


Revenue


Engineering & Construction

$

136,418

7.5%

$

84,636

5.0%


Fabrication Services

52,399

8.2%

46,915

7.0%


Technology

48,024

48.3%

34,669

33.8%


Capital Services

9,957

1.7%

4,330

0.9%


Total operating groups

$

246,798

7.9%

$

170,550

5.8%


  Integration related costs

—



(8,067)





Total

$

246,798

7.9%

$

162,483

5.5%














(1) New awards represent the value of new project commitments received by the Company during a given period, as well as scope growth on existing commitments.






(2) During the three months ended March 31, 2015, we realigned our reportable segments to reflect the present management oversight of our operations. Our maintenance business that was previously reported within our Engineering & Construction operating group (formerly Engineering, Construction & Maintenance) is now reported within our Capital Services operating group (formerly Environmental Solutions), and our engineered products business that was previously reported within our Technology operating group is now reported within our Fabrication Services operating group. Our 2014 segment results were reclassified to reflect the reportable segment realignment.


















Chicago Bridge & Iron Company N.V.

Condensed Consolidated Balance Sheets

(in thousands)







March 31,

December 31,


2015

2014

ASSETS








Current assets

$

3,898,210

$

3,530,459

Equity investments

137,379

107,984

Property and equipment, net

750,563

771,651

Goodwill and other intangibles, net

4,701,384

4,751,685

Other non-current assets

230,705

219,252

Total assets

$

9,718,241

$

9,381,031





LIABILITIES AND SHAREHOLDERS' EQUITY








Current maturities of long-term debt and other borrowings

$

749,286

$

270,738

Other current liabilities

3,838,249

4,051,492

Long-term debt

1,525,128

1,564,158

Other non-current liabilities

619,572

618,340





Shareholders' equity

2,986,006

2,876,303

Total liabilities and shareholders' equity

$

9,718,241

$

9,381,031

Chicago Bridge & Iron Company N.V.

Condensed Consolidated Statements of Cash Flows and Other Financial Data

(in thousands)





Three Months


Ended March 31,


2015

2014

CASH FLOWS








Cash flows from operating activities

$

(289,871)

$

(145,752)

Cash flows from investing activities

(56,879)

(22,026)

Cash flows from financing activities

403,409

152,250

Effect of exchange rate changes on cash and cash equivalents

(60,965)

15,189

Decrease in cash and cash equivalents

(4,306)

(339)

Cash and cash equivalents, beginning of the year

351,323

420,502

Cash and cash equivalents, end of the period

$

347,017

$

420,163





OTHER FINANCIAL DATA








(Increase) decrease in receivables, net

$

(41,175)

$

111,885

Change in contracts in progress, net

(330,345)

(422,510)

Decrease in inventory

2,803

10,968

Decrease in accounts payable

(230,152)

(838)

Change in contract capital

$

(598,869)

$

(300,495)





Depreciation and amortization

$

44,309

$

45,625

Capital expenditures

$

28,978

$

26,485







March 31, 2015

December 31, 2014

Backlog (1)

$

29,934,182

$

30,363,269





(1) Backlog includes the value of new award commitments until work is performed and revenue is recognized or until cancellation. Backlog may also fluctuate with currency movements.

Chicago Bridge & Iron Company N.V.

Reconciliation of Non-GAAP Supplemental Information

(in thousands, except per share data)





Three Months


Ended March 31,


2014



Adjusted income from operations




Income from operations

$

162,483

Integration related costs

8,067

Adjusted income from operations

$

170,550

Adjusted % of Revenue

5.8%



Adjusted net income attributable to CB&I




Net income attributable to CB&I

$

88,951

Integration related costs, net of tax (1)

5,486

Adjusted net income attributable to CB&I

$

94,437



Adjusted net income attributable to CB&I per share




Net income attributable to CB&I

$

0.82

Integration related costs, net of tax (1)

0.05

Adjusted net income attributable to CB&I

$

0.87



(1) The three month period ended March 31, 2014, includes $8,067 of integration related costs, less the tax impact of $2,581. The per share amount for the three month period is based upon diluted weighted average shares of 109,113.







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SOURCE CB&I

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http://www.cbi.com