CB&I net income falls

CB&I has recorded a net income of US$107 million in 1Q16, compared to US$132 million in the corresponding period of last year.

1Q16 revenue of US$2.7 billion compares to US$3.1 billion in 1Q15, which included US$488 million in revenue from the former nuclear business. On a pro forma basis, revenue has increased slightly compared to 1Q15 results. New awards in 1Q16 stood at US$1.2 billion with a backlog of US$21.2 billion.

Net cash provided by operating activities during 1Q16 was US$142 million, representing an increase of US$432 million compared to the same period last year.

Philip K. Asherman, CB&I's President and Chief Executive Officer, said: "Our cash generation in the first quarter reflects our ability to deliver on our capital allocation priorities of reducing leverage, returning capital to shareholders and investing in our business. Despite market uncertainty slowing the pace of new awards in the quarter, we maintained a healthy backlog and solid margins […] Earnings lagged this quarter due to underperformance from our Fabrication Services group and a continuing softness in the technology licensing market worldwide. However, as previously communicated, we expect our new awards, revenue and earnings to progressively improve during the year, and we remain on track to perform within our guided ranges for 2016."

New awards during 1Q16 included scope increases for an LNG mechanical erection and instrumentation project in Australia, refinery maintenance work in the US and Canada, crude oil storage in the Middle East and Canada, petrochemical licensing in the Asia Pacific region, catalyst awards in the Middle East, environmental remediation work for the US Navy, and a variety of technology and fabrication awards globally.

Edited from various sources by Callum O'Reilly

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