Foster Wheeler Reports 2Q 2009 Financial Results



Foster Wheeler reported net income for the second quarter of 2009 of $122.2 million, or $0.96 per diluted share, compared with $160.8 million, or $1.11 per diluted share, in the second quarter of 2008.  Net income in the second quarter of 2009 was $124.0 million, or $0.98 per diluted share, compared with $142.5 million, or $0.98 per diluted share, in the second quarter of 2008.

Second-quarter 2009 consolidated EBITDA (earnings before interest expense, income taxes, depreciation and amortization) was $162.0 million, compared with $220.4 million in the second quarter of 2008. Consolidated EBITDA in the second quarter of 2009 was $163.7 million, compared with $202.2 million in the second quarter of 2008.

For the first six months of 2009, net income was $195.1 million, or $1.54 per diluted share, compared with $298.8 million, or $2.06 per diluted share, for the first six months of 2008. Consolidated EBITDA for the first six months of 2009 was $267.5 million, compared with $415.7 million for the first six months of 2008.

Foster Wheeler's Chairman and Chief Executive Officer, Raymond J. Milchovich, said, "The company's net income in the second quarter of 2009 was driven by very strong EBITDA generation. Specifically, the company reported an increase in consolidated EBITDA in the second quarter of 2009 as compared to the average quarter of 2008, excluding the impact of approximately $17 million of unfavorable currency translation. The increase was due to outstanding commercial and operational performance in both of our business groups. In addition, the strong performance of our Global Engineering and Construction Group was bolstered by its ability to capture available profit enhancement opportunities during the quarter. Also, our Global Power Group's performance benefited from the actions it has taken over the past several years in the pursuit of commercial and operational excellence."

Global Engineering and Construction (E&C) Group

  • EBITDA in the second quarter of 2009 was $145 million, excluding the impact of approximately $14 million of unfavorable currency translation (reported Q2 2009 EBITDA calculated at average 2008 exchange rates). EBITDA was driven by outstanding commercial and operational performance and the capture of available profit enhancement opportunities.
  • Despite the lack of any new "mega" contract booked during the period, new orders booked in Foster Wheeler scope remained at a very strong level. New orders contributed to an all-time record level of scope backlog of $1.98 billion in the second quarter of 2009, excluding the impact of approximately $218 million of unfavorable currency translation (reported Q2 2009 scope backlog calculated at the exchange rates in effect at the end of Q2 2008, when the company had reported record scope backlog). Man-hours in backlog at the end of the second quarter of 2009 amounted to 15.2 million, the second-highest in the company's history.
  • Scope operating revenues were below the average quarter of 2008, primarily due to a modestly lower volume of work executed combined with approximately $52 million of unfavorable currency translation (as compared to average 2008 exchange rates).

Share Repurchase Program

On September 12, 2008, the company announced that its board of directors had authorized a $750 million share repurchase program. The company purchased no shares under the program during the second quarter of 2009. To date, the company has purchased 18.1 million common shares and has approximately $265 million remaining under the existing authorization.
 


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