US contractor KBR posted a 15% increase in 2019 revenues to $5.64 billion although net income dropped about 29% to $202 million.

The company’s adjusted earnings before interest, tax, depreciation and amortisation for last year surged from $412 million to $471 million, while adjusted earnings per share rose 16 cents to $1.69.

Fourth-quarter net income was up $11 million at $58 million on the back of a $122 million hike in revenues to $1.45 billion.

The decline in full-year profit came after KBR reclassified $162 million in its balance sheet from the "cost of revenues" to "selling, general and administrative expenses".

Chief executive Stuart Bradie said all three of KBR’s operating segments — energy, technology and government solutions — contributed to the revenue growth.

“Our portfolio of long-term, multi-year contracts and bookings momentum provide earnings and cash visibility, and we begin 2020 with over 70% of the year’s work secured,” he said.

He added that the contractor’s board has approved a 25% increase in its quarterly dividend and restored the full capacity of its share repurchase authorisation to $350 million.

KBR’s energy business witnessed a 16% revenue boost, primarily attributable to ramp-up of cost-reimbursable projects including a crude terminal expansion project in the key US shale basin of the Permian and a greenfield methanol project in Louisiana, also in the US.

The contractor’s overall backlog rose more than 12% last year to stand at $14.6 billion.

This figure does not include a turnkey contract covering train 4 of the Freeport liquefied natural gas project in the US, which has yet to be sanctioned.

For 2020, the company is guiding for an adjusted EPS between $1.80 and $1.92.

Through to 2022, KBR’s energy business is pursuing $107 billion worth of contracts.

Finance

KBR post profit drop on $162 million reclassification