* Second-quarter earnings 95 cts/share vs 92 cts expected
* Backlog was $43 bln from $42.5 bln three months before
* CEO sees promise in cheap shale gas for driving projects
By Braden Reddall
Aug 2 Engineering company Fluor Corp on
Thursday reported a stronger-than-expected quarterly profit on
growth across its four top segments, while its power unit made a
loss from investing in small-modular nuclear reactor firm
Boosted by oil and gas work, the project backlog for the
largest publicly traded U.S. engineering company increased to
$43 billion from $42.5 billion three months before. This
included $337 million for an aluminum automotive sheet facility
in Saudi Arabia, announced on Wednesday.
Global energy and mining projects make up the bulk of its
backlog, but Chief Executive David Seaton said several large
petrochemical and gas-to-liquids projects were being studied in
North America that would tap cheap shale gas as a feedstock.
"Considering our strategic relationship with Dow and
BASF, and a host of other key clients that are
considering those major capital expenditures, we're very
enthusiastic about this market," Seaton said.
Fluor's second-quarter net profit was $161 million, or 95
cents per share, compared with $165 million, or 94 cents per
share, a year earlier. Revenue grew 18 percent to $7.1 billion.
Analysts had expected earnings of 92 cents per share on
revenue of $6.7 billion, according to Thomson Reuters I/B/E/S.
Fluor's power segment will get a lift this quarter from a $1
billion natural gas plant that Dominion plans to build in
Brunswick County, Virginia, in a contract unveiled on Thursday.
But NuScale, an Oregon-based nuclear technology developer,
is costing Fluor money at the moment. It expects to bring in
partners if it wins backing from a Department of Energy Funding
Opportunity Announcement (FOA), due in September.
While Seaton cautioned that an FOA might not necessarily be
a "seal of approval," it would make NuScale a more attractive
investment for others.
Also on Thursday, Fluor increased the low end of its 2012
earnings forecast by 10 cents, bringing it to $3.50 to $3.80 per
share. Rival KBR Inc did something similar last month
after reporting higher-than-expected earnings.
Earlier this week, Chicago Bridge & Iron Co sought
to create a sizeable Fluor challenger by bidding for Shaw Group
Inc. There are doubts, however, that deal will go
Seaton reiterated that Fluor preferred to focus on smaller,
targeted acquisitions instead of major deals.