Kbr, Inc 10-Q for FY2025 Q1

Kbr, Inc. (KBR)

10-Q 2025-05-06 For: 2025-04-04

Added on April 11, 2026

About this 10-Q

Kbr, Inc filed this 10-Q on May 6, 2025, covering the quarter ended April 4, 2025 (FY2025 Q1).

Headline figures

Quarter ended April 4, 2025, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $2.06B; up 13.0% from $1.82B a year earlier
Net income: $116M; up 24.7% from net income of $93M a year earlier
Diluted EPS: $0.88; up 27.5% from $0.69 a year earlier

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Title of each class	Trading symbol	Name of each exchange on which registered
Common Stock, $0.001 par value	KBR	New York Stock Exchange



			Page
PART I. FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)			5
Condensed Consolidated Statements of Operations			5
Condensed Consolidated Statements of Comprehensive Income (Loss)			6
Condensed Consolidated Balance Sheets			7
Condensed Consolidated Statements of Shareholders' Equity			8
Condensed Consolidated Statements of Cash Flows			9
Notes to Condensed Consolidated Financial Statements			10
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			27
Item 3. Quantitative and Qualitative Disclosures About Market Risk			35
Item 4. Controls and Procedures			37
PART II. OTHER INFORMATION
Item 1. Legal Proceedings			38
Item 1A. Risk Factors			38
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			38
Item 5. Other Information			38
Item 6. Exhibits			39
SIGNATURES			40


Acronym						Definition

AOCL						Accumulated other comprehensive loss
ASC						Accounting Standards Codification
Aspire Defence						Aspire Defence Limited
ASU						Accounting Standards Update


C5ISR						Command, Control, Communications, Computers, Cyber, Intelligence, Surveillance and Reconnaissance
CAS						Cost Accounting Standards for U.S. government contracts
DCAA						Defense Contract Audit Agency
DCMA						Defense Contract Management Agency
DoD						Department of Defense







ESPP						Employee Stock Purchase Plan
Exchange Act						Securities Exchange Act of 1934, as amended
FAR						Federal Acquisition Regulation
FASB						Financial Accounting Standards Board


FKTC						First Kuwaiti Trading Company











JKC						JKC Australia LNG, an Australian joint venture executing the Ichthys LNG Project

LNG						Liquefied natural gas
MD&A						Management's Discussion and Analysis of Financial Condition and Results of Operations

MTS						Mission Technology Solutions
MoD						Ministry of Defence
NASA						National Aeronautics and Space Administration
NCI						Noncontrolling interests

PFIs						Private financed initiatives and projects
PIC						Paid-in capital in excess of par

PPE						Property, Plant and Equipment


RPA						Master Accounts Receivable Purchase Agreement

SEC						U.S. Securities and Exchange Commission
SOFR						Secured Overnight Financing Rate
SONIA						Sterling Overnight Index Average
STS						Sustainable Technology Solutions



U.K.						United Kingdom
U.S.						United States
U.S. GAAP						Accounting principles generally accepted in the United States


VIEs						Variable interest entities


	Three Months Ended
		April 4,		March 29,
		2025		2024

Revenues		$	2,055	$	1,818
Cost of revenues		(1,757)		(1,570)
Gross profit		298		248
Equity in earnings of unconsolidated affiliates		42		30
Selling, general and administrative expenses		(145)		(121)





Other		—		9

Operating income		195		166
Interest expense		(41)		(31)


Other non-operating income (expense)		3		(6)
Income before income taxes		157		129
Provision for income taxes		(42)		(35)
Net income		115		94
Less: Net income (loss) attributable to noncontrolling interests		(1)		1
Net income attributable to KBR		$	116	$	93
Net income attributable to KBR per share
Basic		$	0.88	$	0.69
Diluted		$	0.88	$	0.69
Basic weighted average common shares outstanding		132		135
Diluted weighted average common shares outstanding		132		135
Cash dividends declared per share		$	0.165	$	0.150


	Three Months Ended
		April 4,		March 29,
		2025		2024
Net income		$	115	$	94
Other comprehensive income (loss):
Foreign currency translation adjustments		29		(8)
Pension and post-retirement benefits		1		2
Changes in fair value of derivatives		(18)		11
Other comprehensive income		12		5
Income tax (expense) benefit:


Changes in fair value of derivatives		4		(2)
Income tax (expense) benefit		4		(2)
Other comprehensive income, net of tax		16		3
Comprehensive income		131		97
Less: Comprehensive income (loss) attributable to noncontrolling interests		(1)		1
Comprehensive income attributable to KBR		$	132	$	96


☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to


	April 4,		January 3,
	2025		2025
	(Unaudited)
Assets
Current assets:
Cash and cash equivalents	$	442	$	350
Accounts receivable, net of allowance for credit losses of $8 and $9, respectively	1,150		1,071
Contract assets	280		273

Other current assets	185		179
Total current assets	2,057		1,873

Pension Assets	96		82
Property, plant, and equipment, net of accumulated depreciation of $491 and $474 (including net PPE of $64 and $57 owned by a variable interest entity), respectively	294		289
Operating lease right-of-use assets	194		203
Goodwill	2,643		2,630
Intangible assets, net of accumulated amortization of $448 and $427, respectively	753		763
Equity in and advances to unconsolidated affiliates	178		192
Deferred income taxes	196		209
Other assets	436		422
Total assets	$	6,847	$	6,663
Liabilities and Shareholders’ Equity
Current liabilities:
Accounts payable	$	792	$	777

Contract liabilities	333		336
Accrued salaries, wages and benefits	369		353
Current maturities of long-term debt	39		36


Other current liabilities	324		280
Total current liabilities	1,857		1,782

Employee compensation and benefits	118		135
Income tax payable	124		122
Deferred income taxes	83		83


Long-term debt	2,705		2,533
Operating lease liabilities	219		228

Other liabilities	311		313
Total liabilities	5,417		5,196
Commitments and Contingencies (Notes 5, 10 and 11)
KBR shareholders’ equity:
Preferred stock, $0.001 par value, 50,000,000 shares authorized, none issued	—		—
Common stock, $0.001 par value 300,000,000 shares authorized, 182,787,698 and 182,469,230 shares issued, and 129,735,945 and 132,435,609 shares outstanding, respectively	—		—
PIC	2,534		2,526
Retained earnings	1,461		1,367
Treasury stock, 53,051,753 shares and 50,033,621 shares, at cost, respectively	(1,648)		(1,494)
AOCL	(930)		(946)
Total KBR shareholders’ equity	1,417		1,453
Noncontrolling interests	13		14
Total shareholders’ equity	1,430		1,467
Total liabilities and shareholders’ equity	$	6,847	$	6,663



















Dollars in millions	Total		PIC		Retained Earnings		Treasury Stock		AOCL		NCI
Balance at January 3, 2025	$	1,467	$	2,526	$	1,367	$	(1,494)	$	(946)	$	14
Share-based compensation	5		5		—		—		—		—


Dividends declared to shareholders ($0.165/share)	(22)		—		(22)		—		—		—
Repurchases of common stock	(156)		—		—		(156)		—		—
Issuance of ESPP shares	6		3		—		3		—		—




Other	(1)		—		—		(1)		—		—
Net income (loss)	115		—		116		—		—		(1)
Other comprehensive income, net of tax	16		—		—		—		16		—
Balance at April 4, 2025	$	1,430	$	2,534	$	1,461	$	(1,648)	$	(930)	$	13


















Dollars in millions	Total		PIC		Retained Earnings		Treasury Stock		AOCL		NCI
Balance at December 29, 2023	$	1,394	$	2,505	$	1,072	$	(1,279)	$	(915)	$	11
Share-based compensation	6		6		—		—		—		—

Common stock issued upon exercise of stock options	1		1		—		—		—		—
Dividends declared to shareholders ($0.150/share)	(20)		—		(20)		—		—		—
Repurchases of common stock	(61)		—		—		(61)		—		—
Issuance of ESPP shares	4		2		—		2		—		—



Other	(2)		—		—		(1)		—		(1)
Net income	94		—		93		—		—		1
Other comprehensive income, net of tax	3		—		—		—		3		—
Balance at March 29, 2024	$	1,419	$	2,514	$	1,145	$	(1,339)	$	(912)	$	11


	Three months ended April 4, 2025
Dollars in millions		Mission Technology Solutions		Sustainable Technology Solutions		Corporate		Total


Revenues		$	1,505	$	550	$	—	$	2,055
Cost of revenues		(1,320)		(437)		—		(1,757)
Gross profit		185		113		—		298
Equity in earnings of unconsolidated affiliates		7		35		—		42
Selling, general and administrative expenses		(78)		(30)		(37)		(145)




Other		—		1		(1)		—

Operating income (loss)		114		119		(38)		195
Interest expense		—		—		(41)		(41)


Other non-operating income (expense)		(1)		—		4		3
Income (loss) before income taxes		113		119		(75)		157
Provision for income taxes		—		—		(42)		(42)
Net income (loss)		113		119		(117)		115
Less: Net income (loss) attributable to noncontrolling interests		(2)		1		—		(1)
Net income (loss) attributable to KBR		$	115	$	118	$	(117)	$	116
Supplemental disclosures:
Depreciation and amortization		$	29	$	6	$	6	$	41
Purchases of property, plant and equipment		$	(7)	$	—	$	(2)	$	(9)
Total Assets as of April 4, 2025		$	4,667	$	1,194	$	986	$	6,847


	Three months ended March 29, 2024
Dollars in millions	Mission Technology Solutions		Sustainable Technology Solutions		Corporate		Total

Revenues	$	1,325	$	493	$	—	$	1,818
Cost of revenues	(1,167)		(403)		—		(1,570)
Gross profit	158		90		—		248
Equity in earnings of unconsolidated affiliates	5		25		—		30
Selling, general and administrative expenses	(63)		(21)		(37)		(121)




Other	6		—		3		9
Operating income (loss)	106		94		(34)		166
Interest expense	—		—		(31)		(31)


Other non-operating income (expense)	1		1		(8)		(6)
Income before income taxes	107		95		(73)		129
Provision for income taxes	—		—		(35)		(35)
Net income (loss)	107		95		(108)		94
Less: Net income attributable to noncontrolling interests	—		1		—		1
Net income (loss) attributable to KBR	$	107	$	94	$	(108)	$	93
Supplemental disclosures:
Depreciation and amortization	$	24	$	6	$	6	$	36
Purchases of property, plant and equipment	$	(20)	$	(2)	$	(3)	$	(25)
Total assets as of January 3, 2025	$	4,534	$	1,182	$	947	$	6,663



	Three Months Ended April 4, 2025

Total by Countries/Regions Dollars in millions		Mission Technology Solutions		Sustainable Technology Solutions		Total
United States		$	1,013	$	133	$	1,146
Europe		380		77		457
Middle East		26		152		178
Australia		50		82		132
Africa		18		33		51
Asia		3		41		44
Other countries		15		32		47
Total revenue		$	1,505	$	550	$	2,055

	Three Months Ended March 29, 2024

Total by Countries/Regions Dollars in millions		Mission Technology Solutions		Sustainable Technology Solutions		Total
United States		$	818	$	127	$	945
Europe		396		72		468
Middle East		30		135		165
Australia		47		74		121
Africa		17		33		50
Asia		4		27		31
Other countries		13		25		38
Total revenue		$	1,325	$	493	$	1,818


	April 4, 2025
Dollars in millions	International (a)		Domestic (b)		Total
Cash and cash equivalents	$	234	$	56	$	290
Short-term investments (c)	11		14		25
Cash and cash equivalents held in consolidated joint ventures and Aspire Defence subcontracting entities (d)	118		9		127
Total	$	363	$	79	$	442


	January 3, 2025
Dollars in millions	International (a)		Domestic (b)		Total
Cash and cash equivalents	$	199	$	14	$	213
Short-term investments (c)	8		10		18
Cash and cash equivalents held in consolidated joint ventures and Aspire Defence subcontracting entities (d)	110		9		119
Total	$	317	$	33	$	350



	Three Months Ended		Year ended
	April 4,		January 3,
	2025		2025
Dollars in millions
Beginning balance	$	192	$	206
Equity in earnings of unconsolidated affiliates	42		107
Distributions of earnings of unconsolidated affiliates (a)	(49)		(202)
Payments from unconsolidated affiliates, net	(4)		(9)
Return of equity method investments, net (b)	—		(36)

Foreign currency translation adjustments	2		(2)
Other (c)	(5)		128
Ending balance	$	178	$	192



	Three Months Ended
	April 4,		March 29,
Dollars in millions	2025		2024
Amounts included in project estimates-at-completion at beginning of fiscal year	$	104	$	74
Net increase in project estimates	57		41


Ending balance of amounts included in project estimates-at-completion	$	161	$	115
Amounts recognized over time based on progress	$	114	$	81


Dollars in millions	April 4, 2025		January 3, 2025
Term Loan A	$	1,003	$	1,006
Term Loan B	990		993
Senior Notes	250		250
Revolver	525		345
Unamortized debt issuance costs and discounts	(24)		(25)
Total debt	2,744		2,569
Less: current portion	39		36
Total long-term debt, net of current portion	$	2,705	$	2,533


	Revolver, Term Loan A-1 and Term Loan A-3
Consolidated Net Leverage Ratio	Reference Rate (a)		Base Rate		Commitment Fee
Greater than or equal to 4.25 to 1.00	2.25	%	1.25	%	0.33	%
Less than 4.25 to 1.00 but greater than or equal to 3.25 to 1.00	2.00	%	1.00	%	0.30	%
Less than 3.25 to 1.00 but greater than or equal to 2.25 to 1.00	1.75	%	0.75	%	0.28	%
Less than 2.25 to 1.00 but greater than or equal to 1.25 to 1.00	1.50	%	0.50	%	0.25	%
Less than 1.25 to 1.00	1.25	%	0.25	%	0.23	%


	Term Loan A-2
Consolidated Net Leverage Ratio	Reference Rate (a)		Base Rate		Commitment Fee
Greater than or equal to 4.25 to 1.00	2.13	%	1.13	%	0.33	%
Less than 4.25 to 1.00 but greater than or equal to 3.25 to 1.00	1.88	%	0.88	%	0.30	%
Less than 3.25 to 1.00 but greater than or equal to 2.25 to 1.00	1.63	%	0.63	%	0.28	%
Less than 2.25 to 1.00 but greater than or equal to 1.25 to 1.00	1.38	%	0.38	%	0.25	%
Less than 1.25 to 1.00	1.13	%	0.13	%	0.23	%


Dollars in millions	Accumulated foreign currency translation adjustments		Accumulated pension liability adjustments		Changes in fair value of derivatives		Total
Balance at January 3, 2025	$	(320)	$	(655)	$	29	$	(946)
Other comprehensive income (loss) adjustments before reclassifications	29		—		(10)		19
Amounts reclassified from AOCL	—		1		(4)		(3)
Net other comprehensive income (loss)	29		1		(14)		16
Balance at April 4, 2025	$	(291)	$	(654)	$	15	$	(930)


	Three Months Ended
	April 4, 2025
		Number of Shares	Average Price per Share		Dollars in Millions
Repurchases under the authorized share repurchase program		3,009,087	$	49.83	$	150
Withhold to cover shares		113,683	48.97		6
Total		3,122,770	$	49.80	$	156

	Three Months Ended
	March 29, 2024
		Number of Shares	Average Price per Share		Dollars in Millions
Repurchases under the authorized share repurchase program		826,797	$	60.45	$	50
Withhold to cover shares		189,942	59.14		11
Total		1,016,739	$	60.21	$	61


Dollars in millions	Notional Amount at April 4, 2025*		Pay Fixed Rate (Weighted Average)		Receive Variable Rate	Settlement and Termination
March 2020 Interest Rate Swaps	$	400	0.89	%	Term SOFR	Monthly through January 2027
September 2022 Interest Rate Swaps	$	350	3.43	%	Term SOFR	Monthly through January 2027
March 2023 Interest Rate Swaps	$	205	3.61	%	Term SOFR	Monthly through January 2027
March 2023 Amortizing Interest Rate Swaps	£	108	3.81	%	Term SONIA	Monthly through November 2026
September 2024 Interest Rate Swaps	$	200	3.27	%	Term SOFR	Monthly through August 2027
April 2025 Interest Rate Swaps	$	270	3.39	%	Term SOFR	Monthly through August 2027
April 2025 Forward Interest Rate Swaps	$	150	3.38	%	Term SOFR	Monthly from August 2027 through December 2030


Consolidated Results	Three Months Ended
	April 4,		March 29,		2025 vs. 2024
Dollars in millions	2025		2024		$		%
Revenues	$	2,055	$	1,818	$	237	13	%
Cost of revenues	(1,757)		(1,570)		187		12	%
Gross profit	298		248		50		20	%
Equity in earnings of unconsolidated affiliates	42		30		12		40	%
Selling, general and administrative expenses	(145)		(121)		24		20	%





Other	—		9		(9)		n/m
Operating income	195		166		29		17	%
Interest expense	(41)		(31)		10		32	%


Other non-operating income (expense)	3		(6)		9		n/m
Income before income taxes	157		129		28		22	%
Provision for income taxes	(42)		(35)		7		20	%
Net income	115		94		21		22	%
Less: Net income (loss) attributable to noncontrolling interests	(1)		1		(2)		n/m
Net income attributable to KBR	$	116	$	93	$	23	25	%


Purchase Period	Total Shares Repurchased (1)	Average Price Paid per Share		Shares Repurchased as Part of Publicly Announced Plan	Dollar Value of Maximum Number of Shares that May Yet Be Purchased Under the Plan



January 4, 2025 - January 31, 2025	680	$	54.61	—	$	296,019,108
February 1, 2025 - February 28, 2025	473,967	$	48.90	375,500	$	731,638,238
March 1, 2025 - April 4, 2025	2,648,123	$	49.96	2,633,587	$	600,060,197
Total	3,122,770	$	49.80	3,009,087	$	600,060,197


Exhibit Number						Description
*10.1+						Form of revised Restricted Stock Unit Agreement (US/UK Employee) pursuant to Amended and Restated KBR, Inc. 2006 Stock and Incentive Plan

*10.2+						Form of revised Restricted Stock Unit Agreement (International Employee) pursuant to Amended and Restated KBR, Inc. 2006 Stock and Incentive Plan

*10.3+						Form of revised Performance Stock Unit Agreement (US/UK Employee) pursuant to Amended and Restated KBR, Inc. 2006 Stock and Incentive Plan

*10.4+						Form of revised Performance Stock Unit Agreement (International Employee) pursuant to Amended and Restated KBR, Inc. 2006 Stock and Incentive Plan

*10.5+						Form of revised Performance Award Agreement (US/International Employee Cash Only) pursuant to Amended and Restated KBR, Inc. 2006 Stock and Incentive Plan

*10.6+						Form of revised Performance Award Agreement (US/International Employee Cash/Stock) pursuant to Amended and Restated KBR, Inc. 2006 Stock and Incentive Plan

*31.1						Certification of the Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

*31.2						Certification of the Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

**32.1						Certification Furnished Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

**32.2						Certification Furnished Pursuant to 18 U.S.C. Section 1350 as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

***101						The following financial information from this Quarterly Report on Form 10-Q of KBR, Inc. for the quarter ended April 4, 2025 formatted in iXBRL (Inline eXtensible Business Reporting Language): (i) Condensed Consolidated Statements of Operations, (ii) Condensed Consolidated Statements of Comprehensive Income, (iii) Condensed Consolidated Balance Sheets, (iv) Condensed Consolidated Statements of Shareholders’ Equity, (v) Condensed Consolidated Statements of Cash Flows, and (vi) Notes to the Condensed Consolidated Financial Statements, tagged as blocks of text

104						Cover Page Interactive Data File - formatted as Inline XBRL contained in Exhibit 101




+			Management contracts or compensatory plans or arrangements

*			Filed with this Form 10-Q

**			Furnished with this Form 10-Q

***			Interactive data files


KBR, INC.


/s/ Mark W. Sopp						/s/ Alison G. Vasquez
Mark W. Sopp						Alison G. Vasquez
Executive Vice President and Chief Financial Officer						Senior Vice President and Chief Accounting Officer


Vesting Date			Vested Percentage of Total Number of Restricted Stock Units
1st Anniversary of Grant Date			33 ⅓%
2nd Anniversary of Grant Date			66 ⅔%
3rd Anniversary of Grant Date			100%


By clicking the “Accept” or similar button implemented into the relevant web page or platform, Employee declares, without limitation, his or her consent to the data processing operations described in this Agreement. Employee understands and acknowledges that he or she may withdraw consent at any time with future effect for any or no reason as described in sub-section (f) above.


Vesting Date			Vested Percentage of Total Number of Performance Stock Units
1st Anniversary of Grant Date			33 ⅓%
2nd Anniversary of Grant Date			66 ⅔%
3rd Anniversary of Grant Date			100%


2025 TSR Formula - Sustained Performance

			q=12
Average indexed performance =				∑	(xq / x)
			q=1
			12
where:
x =	share price at beginning of calendar year in which the applicable calendar quarter occurs (measured by simple average of the closing prices of a share trading during regular trading hours for the last twenty trading days preceding the beginning of such calendar year)
xq =	closing share price at the end of each quarter (measured by simple average of the closing prices of a share trading during regular trading hours for the last twenty trading days of such calendar quarter, and adjusted for dividends paid (where the dividend payment date is the ex-dividend date))
q =	quarter number (1 through 12)

Example 1:
		Date	Share price *		Index
			(x)		(xq / x)
		1/1/2025	$ 20.00
		3/31/2025	$ 22.00		110.0
		6/30/2025	$ 24.00		120.0
		9/30/2025	$ 21.00		105.0
		12/31/2025	$ 20.00		100.0
		3/31/2026	$ 18.00		90.0
		6/30/2026	$ 22.00		110.0
		9/30/2026	$ 25.00		125.0
		12/31/2026	$ 28.00		140.0
		3/31/2027	$ 31.00		110.7
		6/30/2027	$ 33.00		117.9
		9/30/2027	$ 30.00		107.1
		12/31/2027	$ 28.00		100.0

q=12
	∑	(xq / x)	=		1,335.7
q=1


q=12
	∑	(xq / x)	=		111.3
q=1
12

	* Average price adjusted for dividends paid in the period, where the dividend payment date is the ex-dividend date.


TSR Peer Group Percentile and TSR Payout Percentage Table

		Threshold	Target	Maximum
Percentile	< 20%	20%	50%	≥ 90%
TSR Payout Percentage	0%	25%	100%	200%

LTI TSR Calculation Method
	Ranking	Percentile *	TSR Payout Percentage**

	1	100.0%	200.0%
Maximum	2	94.4%	200.0%
	3	88.9%	197.3%
	4	83.3%	183.3%
	5	77.8%	169.5%
	6	72.2%	155.5%
	7	66.7%	141.8%
	8	61.1%	127.8%
	9	55.6%	114.0%
Target	10	50.0%	100.0%
	11	44.4%	86.0%
	12	38.9%	72.3%
	13	33.3%	58.3%
	14	27.8%	44.5%
Threshold	15	22.2%	30.5%
	16	16.7%	0.0%
	17	11.1%	0.0%
	18	5.6%	0.0%
	19	0.0%	0.0%
* Rounded to 1 decimal place. ** For a Percentile ranking between Threshold and Target or Target and Maximum, the TSR Payout Percentage earned shall be determined by linear interpolation between maximum and threshold based on the Percentile ranking achieved. Rounded to 1 decimal place.


/s/ Stuart J. B. Bradie
Stuart J. B. Bradie
Chief Executive Officer