KBR (KBR) Q4 2024 earnings summary

Executive summary

• Delivered strong Q4 and FY2024 results, exceeding expectations with double-digit growth in revenue, Adjusted EBITDA, and Adjusted EPS, along with margin expansion.

• Achieved significant contract wins in defense, sustainable tech, and energy, supporting a robust backlog of over $21 billion and a book-to-bill ratio of 1.1x.

• Completed LinQuest acquisition and integration, enhancing digital, engineering, and military space capabilities.

• Realigned business segments and leadership, improving agility, cost efficiency, and positioning for future growth.

• Entering 2025 with more than 75% of work under contract and a confident outlook for continued double-digit growth.

Financial highlights

• Q4 2024 revenue reached $2.1 billion, up 23% year-over-year; full year revenue was $7.7 billion, up 11%.

• Q4 Adjusted EBITDA was $228 million (up 21%), margin 11.2%; FY Adjusted EBITDA was $870 million (up 16%).

• Q4 Adjusted EPS was $0.91 (up 32%); FY Adjusted EPS was $3.34 (up 15%).

• Operating cash flow for FY2024 was $462 million, with 103% conversion to net income.

• Returned ~$300 million to shareholders via share repurchases and dividends in FY2024.

Outlook and guidance

• FY2025 guidance: revenues $8.7–$9.1 billion (up 15%), Adjusted EBITDA $950–$990 million (up 11%), Adjusted EPS $3.71–$3.95 (up 15%), and operating cash flow $500–$550 million.

• Capex expected at $50–$65 million; effective tax rate 25–27%; targeting net leverage below 2.5x by year-end 2025.

• Over 75% of projected FY2025 revenues already under contract.

• Guidance assumes continued demand for national security, space, and operations programs, and a significant ramp in HomeSafe volumes.

• Assumptions include ~133 million adjusted weighted average shares and $165 million D&A.