KBR to Drop Energy Business
KBR, Inc. reported last week that it has completed a review of its portfolio and will transition from a three-segment to two-segment business model. The firm revealed in a written statement that its new model will comprise its Government Solutions and Technology Solutions units, removing its Energy Solutions business from its portfolio.
According to a company description on KBR’s LinkedIn page, the Energy Solutions unit provides services tied to energy transition and efficiency, onshore and offshore oil and gas, liquefied natural gas and gas-to-liquids, refining, petrochemicals, chemicals and fertilizers. KBR stated that it will carry out the transition through the rest of 2020.
“The transformation of our operating model greatly simplifies our business and allows us to further reduce risk and narrow our strategic focus,” commented Stuart Bradie, KBR’s president and CEO. “This transformation is the culmination of a years-long shift away from high-risk and commoditized markets and toward more agile, technology-driven, knowledge-based delivery.”
KBR stated that its revamped Technology Solutions business will include process technologies and catalysts and integrate more technology-led industrial services that apply digital remote monitoring. Moreover, it noted Technology Solutions “will be enhanced and augmented” with investment in the firm’s advisory/consulting practice – specifically in conjunction with energy transition, energy efficiency and sustainability.
“Recent and ongoing market disruptions, particularly in the energy sector, have allowed us to reimagine how we best add value to our customers,” continued Bradie. “We accelerated our thinking and implementation to becoming a solutions-oriented business. Enhancing our Technology Solutions business with our high-end, sustainability-focused industrial sector expertise and client relationships creates exciting synergy opportunities.”
KBR pointed out that it has removed approximately $1.2 billion of backlog tied to Energy Solutions projects from its books. The company explained that it will no longer pursue or perform the projects given market conditions and the portfolio streamlining.
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