Fluor Q2 Earnings Call Highlights

Fluor NYSE: FLR reported second-quarter revenue of $4.3 billion, up 9% from a year earlier, as strong project execution helped lift adjusted EBITDA to $149 million from $96 million in the prior-year period. Adjusted earnings per share rose to $0.91 from $0.43.

The engineering and construction company also reported more than $6 billion in new awards during the quarter, lifting ending backlog to $26.9 billion. Chief Executive Officer Jim Breuer said several client decisions arrived sooner than expected, supporting the company’s expectation for a full-year book-to-bill ratio “well above” one.

“The pull-through capture of our prospect pipeline is taking flight,” Breuer said, pointing to awards across nuclear fuels, fertilizers, copper and midstream markets.

Breuer said Fluor is converting front-end engineering and planning assignments into larger engineering, procurement and construction, or EPC, programs while replenishing its pipeline with additional front-end opportunities. Areas of focus include fertilizers in the United Kingdom, data centers, copper projects in the Americas, domestic refining, nuclear power, Middle Eastern chemicals and liquefied natural gas.

Urban Solutions received $3.2 billion in new awards during the quarter, including construction management for a Chilean copper mine, a feasibility study for an Anglo fertilizer project in the U.K., expanded Canadian fertilizer-project scope, added U.S. life-sciences work and a European infrastructure project.

Breuer said Fluor sees nearly $30 billion of potential Mining & Metals awards over the next 18 months within its in-house pipeline. These opportunities include copper, fertilizers, potash, steel and aluminum projects across South America, North America, Australia, the U.K. and the Middle East. He said most anticipated Mining & Metals work would be reimbursable and lower risk, with margins consistent with the segment’s historical profile.

Clients remain focused on capital efficiency, permitting and project economics, Breuer said, though demand and commodity prices for copper, fertilizers, aluminum and steel remain supportive.

Fluor said it completed two legacy infrastructure projects during the quarter and expects its remaining two legacy projects to be completed by year-end. Remaining legacy-project backlog fell to $120 million at the end of the second quarter. Urban Solutions generated segment profit of $38 million, compared with ...