Fluor Reports Second Quarter 2025 Results
- First cargo shipped from LNG Canada project
- NuScale to convert 15 million class B shares
-
Share repurchases of
$153 million during Q2 - Company adjusts 2025 guidance
“I’m pleased with the tremendous accomplishments achieved by the team on the LNG Canada project, including the first shipment of LNG. We received a contract award to update the FEED package for a proposed phase 2 expansion, and this week an agreement was reached on our COVID claims and other matters,” said
-
Q2 2025 Highlights:
-
Revenue of
$4.0 billion , down 6% y/y -
GAAP net earnings attributable to Fluor of
$2.5 billion ; equity method earnings included$3.2 billion in pre-tax mark-to-market gains on our investment in NuScale -
Adjusted EBITDA of
$96 million , down 42% y/y; includes$54 million net impact of cost growth on three infrastructure projects -
EPS of
$14.81 ; adjusted EPS of$0.43 , down 49% y/y -
Consolidated segment profit[1] of
$78 million , down 60% y/y -
Cash and marketable securities at the end of the quarter were
$2.3 billion -
G&A expenses of
$52 million , up 4% y/y
-
Revenue of
-
Q2 Operating Cash Flow:
($21) million vs$282 million y/y, reflects increases in working capital on several large projects; full year guidance$200 -$250 million -
New Awards: Q2 new awards totaled
$1.8 billion , down 43% y/y; 72% reimbursable; also recognized$1.7 billion in positive backlog adjustments -
Backlog:
$28.2 billion at 80% reimbursable, down 13% y/y from$32.3 billion a year ago -
NuScale: Conversion of 15 million class B shares in August
[1] Non-GAAP Financial Measure. See “Non-GAAP Financial Measures” for additional information.
Outlook
Consistent with prior practice, we are not providing forward-looking guidance for
In reflection of client hesitation around economic uncertainty and its impact on new awards and project delays and results for the quarter, the company is revising its adjusted EBITDA guidance as follows:
|
|
Previous |
As Revised |
|
Adjusted EBITDA Guidance |
|
|
|
Adjusted EPS Guidance |
|
|
Estimates for 2025 assume a tax rate of 30 percent. Adjusted EPS and adjusted EBITDA guidance exclude items similar to those outlined in the reconciliation table at the end of this release.
Business Segments
Urban Solutions reported a profit of
Energy Solutions reported a profit of
Mission Solutions reported a profit of
Conference Call
Fluor will host a conference call at
Non-GAAP Financial Measures
This news release contains discussions of consolidated segment profit (loss) and margin, adjusted net earnings (loss), adjusted EPS and adjusted EBITDA that are non-GAAP financial measures under
About
Forward-Looking Statements: This release may contain forward-looking statements (including without limitation statements to the effect that the Company or its management "will," "believes," "expects," “anticipates,” "plans" or other similar expressions). These forward-looking statements, including statements relating to resolution of outstanding claims or lawsuits, strategic and operation plans, future growth, new awards, backlog, earnings, capital allocation plans and the outlook for the company’s business.
Actual results may differ materially as a result of a number of factors, including, among other things, the cyclical nature of many of the markets the Company serves and our clients’ vulnerability to poor economic conditions, such as inflation, slow growth or recession, which may result in decreased capital investment and reduced demand for our services; the Company's failure to receive new contract awards; cost overruns, project delays or other problems arising from project execution activities, including the failure to meet cost and schedule estimates; intense competition in the industries in which we operate; the inability to hire and retain qualified personnel; failure of our joint venture or other partners to perform their obligations; the failure of our suppliers, subcontractors and other third parties to adequately perform services under our contracts; cyber-security breaches; possible information technology interruptions; risks related to the use of artificial intelligence and similar technologies; exposure to political and economic risks in different countries, including tariffs and trade policies, geopolitical events and conflicts, civil unrest, security issues, labor conditions and other foreign economic and political uncertainties in the countries in which we do business; client cancellations of, or scope adjustments to, existing contracts; failure to maintain safe worksites and international security risks; risks or uncertainties associated with events outside of our control, including weather conditions, pandemics, public health crises, political crises or other catastrophic events; the use of estimates in preparing our financial statements; GAAP earnings volatility due to recurring fair value measurements of our investment in NuScale; client delays or defaults in making payments; uncertainties, restrictions and regulations impacting our government contracts; the potential impact of certain tax matters; the Company's ability to secure appropriate insurance; liabilities associated with the performance of nuclear services; foreign currency risks; the loss of one or a few clients that account for a significant portion of the Company's revenues; failure to adequately protect intellectual property rights; climate change, natural disasters and related environmental issues; increasing scrutiny with respect to sustainability practices; risks related to our indebtedness; the availability of credit and restrictions imposed by credit facilities, both for the Company and our clients, suppliers, subcontractors or other partners; restrictive covenants contained in the agreements governing our debt; possible limitations on bonding or letter of credit capacity; failure to obtain favorable results in existing or future litigation and regulatory proceedings, dispute resolution proceedings or claims, including claims for additional costs; failure by us or our employees, agents or partners to comply with laws; new or changing legal requirements, including those relating to environmental, health and safety matters; and restrictions on possible transactions imposed by our charter documents and
Additional information concerning these and other factors can be found in the Company's public periodic filings with the
|
SUMMARY OF FINANCIALS AND |
|||||||||||||||||||
|
|
|||||||||||||||||||
|
|
Three Months Ended
|
|
Six Months Ended
|
||||||||||||||||
|
(in millions) |
2025 |
|
2024 |
|
2025 |
|
2024 |
||||||||||||
|
Revenue |
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Urban Solutions |
$ |
2,070 |
|
|
|
$ |
1,831 |
|
|
|
$ |
2,349 |
|
|
|
$ |
3,028 |
|
|
|
Energy Solutions |
|
1,143 |
|
|
|
|
1,595 |
|
|
|
|
4,227 |
|
|
|
|
3,309 |
|
|
|
Mission Solutions |
|
762 |
|
|
|
|
704 |
|
|
|
|
1,358 |
|
|
|
|
1,305 |
|
|
|
Other |
|
3 |
|
|
|
|
97 |
|
|
|
|
25 |
|
|
|
|
319 |
|
|
|
Total revenue |
$ |
3,978 |
|
|
|
$ |
4,227 |
|
|
|
$ |
7,959 |
|
|
|
$ |
7,961 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Segment profit (loss) $ and margin % |
|
|
|
|
|
|
|
|
|
|
|||||||||
|
Urban Solutions |
$ |
29 |
|
1.4% |
|
$ |
105 |
|
5.7% |
|
$ |
99 |
|
2.3% |
|
$ |
155 |
|
4.7% |
|
Energy Solutions |
|
15 |
|
1.3% |
|
|
75 |
|
4.7% |
|
|
63 |
|
2.7% |
|
|
143 |
|
4.7% |
|
Mission Solutions |
|
35 |
|
4.6% |
|
|
41 |
|
5.8% |
|
|
40 |
|
2.9% |
|
|
63 |
|
4.8% |
|
Other |
|
(1 |
) |
(33.3) |
|
|
(27 |
) |
NM |
|
|
8 |
|
32.0 |
|
|
(49 |
) |
NM |
|
Total segment profit $ and margin % |
$ |
78 |
|
2.0% |
|
$ |
194 |
|
4.6% |
|
$ |
210 |
|
2.6% |
|
$ |
312 |
|
3.9% |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
G&A |
|
(52 |
) |
|
|
|
(50 |
) |
|
|
|
(88 |
) |
|
|
|
(110 |
) |
|
|
Foreign currency gain (loss) |
|
(30 |
) |
|
|
|
48 |
|
|
|
|
(44 |
) |
|
|
|
60 |
|
|
|
Interest income (expense), net |
|
17 |
|
|
|
|
38 |
|
|
|
|
34 |
|
|
|
|
77 |
|
|
|
Earnings (loss) attributable to NCI |
|
(22 |
) |
|
|
|
(16 |
) |
|
|
|
(13 |
) |
|
|
|
(34 |
) |
|
|
Earnings (loss) before taxes |
|
(9 |
) |
|
|
|
214 |
|
|
|
|
99 |
|
|
|
|
305 |
|
|
|
Income tax expense (including |
|
(765 |
) |
|
|
|
(61 |
) |
|
|
|
(712 |
) |
|
|
|
(111 |
) |
|
|
Net earnings (loss) before equity method earnings |
$ |
(774 |
) |
|
|
$ |
153 |
|
|
|
$ |
(613 |
) |
|
|
$ |
194 |
|
|
|
Equity method earnings |
$ |
3,212 |
|
|
|
$ |
— |
|
|
|
$ |
2,819 |
|
|
|
$ |
— |
|
|
|
Net earnings |
$ |
2,438 |
|
|
|
$ |
153 |
|
|
|
$ |
(613 |
) |
|
|
$ |
194 |
|
|
|
Less: Net earnings (loss) attributable to NCI |
|
(22 |
) |
|
|
|
(16 |
) |
|
|
|
(13 |
) |
|
|
|
(34 |
) |
|
|
Net earnings attributable to Fluor |
$ |
2,460 |
|
|
|
$ |
169 |
|
|
|
$ |
2,219 |
|
|
|
$ |
228 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
New awards |
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
Urban Solutions |
$ |
856 |
|
|
|
$ |
2,416 |
|
|
|
$ |
6,186 |
|
|
|
$ |
7,289 |
|
|
|
Energy Solutions |
|
549 |
|
|
|
|
582 |
|
|
|
|
864 |
|
|
|
|
1,298 |
|
|
|
Mission Solutions |
|
363 |
|
|
|
|
63 |
|
|
|
|
527 |
|
|
|
|
1,208 |
|
|
|
Other |
|
— |
|
|
|
|
37 |
|
|
|
|
— |
|
|
|
|
321 |
|
|
|
Total new awards |
$ |
1,768 |
|
|
|
$ |
3,098 |
|
|
|
$ |
7,577 |
|
|
|
$ |
10,116 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
|
New awards related to projects located outside of the |
50% |
|
|
31% |
|
|
50% |
|
|
28% |
|
||||||||
|
(in millions) |
|
|
|
|
|
||||
|
Backlog |
|
|
|
|
|
||||
|
Urban Solutions |
$ |
20,576 |
|
|
|
$ |
19,571 |
|
|
|
Energy Solutions |
|
5,583 |
|
|
|
|
8,531 |
|
|
|
Mission Solutions |
|
2,046 |
|
|
|
|
3,775 |
|
|
|
Other |
|
— |
|
|
|
|
427 |
|
|
|
Total backlog |
$ |
28,205 |
|
|
|
$ |
32,304 |
|
|
|
|
|
|
|
|
|
||||
|
Backlog related to projects located outside of the |
42% |
|
|
53% |
|
||||
|
Backlog related to reimbursable projects |
80% |
|
|
81% |
|
||||
|
NET EARNINGS EXCLUDING AMOUNTS ATTRIBUTABLE TO EQUITY METHOD EARNINGS |
||||||||||
|
|
||||||||||
|
|
Three Months
|
|
Six Months
|
|||||||
|
(in millions) |
|
|
|
|
||||||
|
|
|
|
|
|
|
|
||||
|
Earnings (loss) before taxes |
|
$ |
(9 |
) |
|
|
$ |
99 |
|
|
|
|
|
|
|
|
|
|
||||
|
Income tax expense |
|
|
(765 |
) |
|
|
|
(712 |
) |
|
|
Less: Income tax expense attributable to equity method earnings |
|
|
757 |
|
|
|
|
684 |
|
|
|
Income tax expense and effective tax rate, excluding amount attributable to equity method earnings |
|
|
(8 |
) |
(89)% |
|
|
(28 |
) |
28% |
|
|
|
|
|
|
|
|
||||
|
Net earnings (loss) excluding amount attributable to equity method earnings |
|
$ |
(17 |
) |
|
|
$ |
71 |
|
|
|
|
|
|
|
|
|
|
||||
|
Equity method earnings |
|
$ |
3,212 |
|
|
|
$ |
2,819 |
|
|
|
Income tax expense and effective tax rate attributable to equity method earnings |
|
|
(757 |
) |
24% |
|
|
(684 |
) |
24% |
|
Equity method earnings, net of related income tax expense |
|
$ |
2,455 |
|
|
|
$ |
2,135 |
|
|
|
|
|
|
|
|
|
|
||||
|
Net earnings |
|
$ |
2,438 |
|
|
|
$ |
2,206 |
|
|
|
SUMMARY OF CASH FLOW INFORMATION |
||||||||
|
|
||||||||
|
|
|
Six Months Ended
|
||||||
|
(in millions) |
|
|
2025 |
|
|
|
2024 |
|
|
OPERATING CASH FLOW |
|
$ |
(307 |
) |
|
$ |
171 |
|
|
|
|
|
|
|
||||
|
INVESTING CASH FLOW |
|
|
|
|
||||
|
Proceeds from sales and maturities (purchases) of marketable securities |
|
|
34 |
|
|
|
(9 |
) |
|
Capital expenditures |
|
|
(25 |
) |
|
|
(82 |
) |
|
Proceeds from sale of assets |
|
|
62 |
|
|
|
74 |
|
|
Investments in partnerships and joint ventures |
|
|
(135 |
) |
|
|
(21 |
) |
|
Other |
|
|
3 |
|
|
|
— |
|
|
Investing cash flow |
|
|
(61 |
) |
|
|
(38 |
) |
|
|
|
|
|
|
||||
|
FINANCING CASH FLOW |
|
|
|
|
||||
|
Repurchase of common stock |
|
|
(295 |
) |
|
|
— |
|
|
Purchase and retirement of debt |
|
|
(36 |
) |
|
|
(24 |
) |
|
Other |
|
|
(10 |
) |
|
|
30 |
|
|
Financing cash flow |
|
|
(341 |
) |
|
|
6 |
|
|
|
|
|
|
|
||||
|
Effect of exchange rate changes on cash |
|
|
52 |
|
|
|
(29 |
) |
|
Increase (decrease) in cash and cash equivalents |
|
|
(657 |
) |
|
|
110 |
|
|
Cash and cash equivalents at beginning of period |
|
|
2,829 |
|
|
|
2,519 |
|
|
Cash and cash equivalents at end of period |
|
$ |
2,172 |
|
|
$ |
2,629 |
|
|
|
|
|
|
|
||||
|
Cash paid during the period for: |
|
|
|
|
||||
|
Interest |
|
$ |
19 |
|
|
$ |
22 |
|
|
Income taxes (net of refunds) |
|
|
83 |
|
|
|
31 |
|
|
RECONCILIATION OF |
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|
|
|||||||||||||||
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
(In millions, except per share amounts) |
|
2025 |
|
|
|
2024 |
|
|
|
2025 |
|
|
|
2024 |
|
|
Net earnings attributable to Fluor |
$ |
2,460 |
|
|
$ |
169 |
|
|
$ |
2,219 |
|
|
$ |
228 |
|
|
Exclude: Stork & AMECO businesses marketed for sale or sold |
|
1 |
|
|
|
— |
|
|
|
(9 |
) |
|
|
8 |
|
|
Net earnings from core operations (1) |
|
2,461 |
|
|
|
169 |
|
|
|
2,210 |
|
|
|
236 |
|
|
Adjustments: (2) |
|
|
|
|
|
|
|
||||||||
|
Equity method earnings |
$ |
(3,212 |
) |
|
$ |
— |
|
|
$ |
(2,819 |
) |
|
$ |
— |
|
|
NuScale expenses |
|
— |
|
|
|
26 |
|
|
|
— |
|
|
|
57 |
|
|
Impact of litigation on completed projects (3) |
|
28 |
|
|
|
— |
|
|
|
56 |
|
|
|
— |
|
|
Impact of bad debt reserves taken for a long-completed project |
|
— |
|
|
|
— |
|
|
|
22 |
|
|
|
— |
|
|
Severance and other exit costs |
|
9 |
|
|
|
— |
|
|
|
9 |
|
|
|
— |
|
|
Reserve for legacy legal claims |
|
4 |
|
|
|
— |
|
|
|
4 |
|
|
|
— |
|
|
Embedded foreign currency derivative (gain)/loss |
|
11 |
|
|
|
(20 |
) |
|
|
13 |
|
|
|
(27 |
) |
|
Foreign currency (gain)/loss |
|
30 |
|
|
|
(48 |
) |
|
|
44 |
|
|
|
(60 |
) |
|
Tax expense on above items |
|
741 |
|
|
|
21 |
|
|
|
658 |
|
|
|
23 |
|
|
Adjusted Net Earnings |
$ |
72 |
|
|
$ |
148 |
|
|
$ |
197 |
|
|
$ |
229 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Diluted EPS |
$ |
14.81 |
|
|
$ |
0.97 |
|
|
$ |
13.19 |
|
|
$ |
1.32 |
|
|
Adjusted EPS |
$ |
0.43 |
|
|
$ |
0.85 |
|
|
$ |
1.17 |
|
|
$ |
1.32 |
|
|
(1) Core operations excludes the results of our now-divested Stork and AMECO businesses. |
|
|
|
(2) We exclude earnings impacts for litigation outcomes, claims, settlements or associated damages from adjusted earnings when they are significant in magnitude, non-routine and do not represent on-going normal operations. |
|
|
|
(3) Reflects the impact of an arbitration ruling on a fabrication project at our Energy Solutions joint venture in |
|
RECONCILIATION OF |
|||||||||||||||
|
|
|||||||||||||||
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
(in millions) |
|
2025 |
|
|
|
2024 |
|
|
|
2025 |
|
|
|
2024 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Net earnings attributable to Fluor |
$ |
2,460 |
|
|
$ |
169 |
|
|
$ |
2,219 |
|
|
$ |
228 |
|
|
Interest income, net |
|
(17 |
) |
|
|
(38 |
) |
|
|
(34 |
) |
|
|
(77 |
) |
|
Tax expense |
|
765 |
|
|
|
61 |
|
|
|
712 |
|
|
|
111 |
|
|
Equity method earnings |
|
(3,212 |
) |
|
|
— |
|
|
|
(2,819 |
) |
|
|
— |
|
|
Depreciation & amortization |
|
17 |
|
|
|
16 |
|
|
|
35 |
|
|
|
34 |
|
|
EBITDA |
$ |
13 |
|
|
$ |
208 |
|
|
$ |
113 |
|
|
$ |
296 |
|
|
|
|
|
|
|
|
|
|
||||||||
|
Adjustments: (1) |
|
|
|
|
|
|
|
||||||||
|
Stork & AMECO businesses marketed for sale or sold |
$ |
1 |
|
|
$ |
(1 |
) |
|
$ |
(10 |
) |
|
$ |
(13 |
) |
|
NuScale expenses |
|
— |
|
|
|
26 |
|
|
|
— |
|
|
|
57 |
|
|
Impact of litigation on completed projects (2) |
|
28 |
|
|
|
— |
|
|
|
56 |
|
|
|
— |
|
|
Impact of bad debt reserves taken for a long-completed project |
|
— |
|
|
|
— |
|
|
|
22 |
|
|
|
— |
|
|
Severance and other exit costs |
|
9 |
|
|
|
— |
|
|
|
9 |
|
|
|
— |
|
|
Reserve for legacy legal claims |
|
4 |
|
|
|
— |
|
|
|
4 |
|
|
|
— |
|
|
Embedded foreign currency derivative (gain)/loss |
|
11 |
|
|
|
(20 |
) |
|
|
13 |
|
|
|
(27 |
) |
|
G&A: Foreign currency (gain)/loss |
|
30 |
|
|
|
(48 |
) |
|
|
44 |
|
|
|
(60 |
) |
|
Adjusted EBITDA |
$ |
96 |
|
|
$ |
165 |
|
|
$ |
251 |
|
|
$ |
253 |
|
|
(1) We exclude earnings impacts for litigation outcomes, claims, settlements or associated damages from adjusted earnings when they are significant in magnitude, non-routine and do not represent on-going normal operations. |
|
|
|
(2) Reflects the impact of an arbitration ruling on a fabrication project at our Energy Solutions joint venture in |
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View source version on businesswire.com: https://www.businesswire.com/news/home/20250801375860/en/
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