Yahoo Finance Fluor's (FLR) Q4 Earnings & Revenues Miss, 2023 Views Strong
Fluor Corporation’s FLR shares slipped 0.19% on Feb 21 after it reported lower-than-expected results for fourth-quarter 2022. Earnings and revenues missed the Zacks Consensus Estimate but increased from the previous year.
David Constable, chairman and chief executive officer of Fluor, stated, “In 2022, we demonstrated our resilience, continued to grow and remained steadfast in taking actions to achieve positive results. With a renewed sense of confidence, I am excited about the opportunities in front of us and encouraged by our ability to deliver significant shareholder value now and in the years ahead.”
Inside the Headlines
Fluor reported adjusted earnings of 43 cents per share, which lags the consensus estimate of 54 cents by 20.4%. The reported figure rose 38.7% from 31 cents a year ago.
Quarterly revenues of $3,709 million missed the consensus mark of $4,140 million by 10.4%. The reported figure, however, increased by 2.4% from the year-ago level of $3,622 million. The upside was primarily attributable to a higher contribution from the Energy Solutions segment.
Overall, the company’s segment profit came in at $174 million, reflecting a rise from $144 million a year ago. Segment margin of 4.7% expanded from 4% in the year-ago period. Adjusted EBITDA for the reported period was $136 million, up from $108 million in the prior-year period.
Fluor's total new awards for the quarter came in at $4.6 billion compared with $989 million in the year-ago period. The consolidated backlog at the end of 2022 came in at $26.049 billion, up from $20.8 billion at 2021-end.
Segmental Discussion
The Energy Solutions segment’s revenues grew 38.6% year over year to $1,775 million in the fourth quarter. The segment margin expanded 180 basis points (bps) to 7% from a year ago. New awards came in at $916 million in the quarter, up from $399 million in the fourth quarter of 2021. The backlog at quarter-end was $9.13 billion compared with $9.32 billion at 2021-end.
Revenues in the Urban Solutions segment totaled $975 million, down 2.1% on a year-over-year basis. The segment margin of 3.5% contracted 240 bps year over year. New awards came in at $3,329 million for the quarter, significantly up from $261 million a year ago. The backlog at quarter-end was $9.9 billion, up from $7.05 billion at 2021-end.
Revenues in the Mission Solutions segment totaled $509 million, down 42.2% on a year-over-year basis. The segment margin declined 40 bps to 3.9% from previous year. It booked new awards worth $36 million, up from $24 million a year ago. The backlog at quarter-end was $5.67 billion compared with $2.56 billion at 2021-end.
The Other segment, which comprises NuScale, generated revenues of $450 million for the quarter, down 2.2% from the year-ago period. This segment generated a loss of $3 million versus $2 million a year ago. It booked new awards worth $316 million, up from the year-ago level of $305 million. The backlog at quarter-end was $1.35 billion compared with $1.87 billion at 2021-end.
2022 Highlights
For the year, Fluor reported revenues of $13.7 billion and adjusted earnings of 82 cents per share. In 2021, it reported revenues of $14.2 billion and adjusted earnings of 94 cents per share. Adjusted EBITDA of $327 million was down from the 2021 level of $358 million.
The new awards were $19.8 billion compared to $10 billion a year ago.
Guidance
For 2023, Fluor expects adjusted earnings per share in the range of $1.50-$1.90 per share. It expects adjusted EBITDA in the range of $450-$600 million. The consensus mark for adjusted earnings is currently pegged at $1.81 per share.
FLR also anticipates revenue growth of nearly 10%, G&A expenses of $40 million each quarter and tax rate of 45% for 2023. Also, segment margin is expected to be 5% for Energy Solutions, 3.5% for Urban Solutions, and 3.5% for Mission Solutions.
For 2026, it anticipates adjusted earnings of $3.10-$3.60 per share and adjusted EBITDA in the range of $800-950 million.
Zacks Rank & Recent Construction Releases
Fluor currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Owens Corning OC reported impressive results for fourth-quarter 2022. Quarterly earnings and net sales surpassed the Zacks Consensus Estimate and increased on a year-over-year basis.
Despite lower volumes, high costs and unfavorable currency, strong pricing helped the company generate higher earnings.
Masco Corporation MAS reported mixed results for fourth-quarter 2022. The bottom line lagged the Zacks Consensus Estimate and declined on a year-over-year basis due to supply-chain challenges and inflation headwinds.
Net sales surpassed the consensus mark but declined from the prior-year quarter’s level, thanks to demand softness across the product categories in North America, partially offset by selling price increases.
Armstrong World Industries, Inc. AWI reported mixed results for fourth-quarter 2022, wherein the earnings surpassed the Zacks Consensus Estimate and declined on a year-over-year basis.
On the contrary, AWI’s net sales beat the consensus estimates and grew from the prior year on the back of pricing actions undertaken.
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