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Monday, July 29, 2019

McDermott (MDR) reported earnings on Mon 29 July 2019 (a/h)


 






McDermott misses by $0.16, misses on revs; lowers FY19 guidance; continues to pursue a sale of the remaining portion of its pipe fabrication business
  • Reports Q2 (Jun) loss of $0.07 per share, excluding non-recurring items, $0.16 worse than the S&P Capital IQ Consensus of $0.09; revenues rose 23.2% year/year to $2.14 bln vs the $2.25 bln S&P Capital IQ Consensus.
  • Co issues downside guidance for FY19, sees EPS of ~($0.32) vs. $1.59 S&P Capital IQ Consensus; sees FY19 revs of ~$9.5 bln vs. $10.02 bln S&P Capital IQ Consensus; Adjusted EBITDA of ~$725 mln.
  • The company today has updated its guidance for 2019 driven by four main factors: 1) the weaker than expected operating results for the second quarter of 2019; 2) the impact of reduced revenues and higher unallocated operating expenses due to slippage in certain new awards and customer changes to schedule on several projects; 3) changes in our assumptions about the expected performance of legacy CB&I projects in our NCSA operating segment; and 4) a shift from the fourth quarter of 2019 to 2020 in the assumed timing of remaining incentives on the Cameron LNG project. Full-year guidance assumes a sharp improvement in operating income in the fourth quarter of 2019, as the company builds momentum heading into 2020.
  • During the second quarter of 2019, McDermott completed the sale of the APP business, the distribution and manufacturing arm of its pipe fabrication business. McDermott continues to pursue a sale of the remaining portion of its pipe fabrication business.

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