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FLUOR CORP (FLR)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 adjusted EPS of $0.73 beat S&P Global consensus ~$0.50; adjusted EBITDA of $155M was above consensus ~$122M, while revenue of $3.98B missed ~$4.18B as Energy Solutions execution slowed and Mission Solutions booked a $28M reserve .*
  • GAAP net loss attributable to Fluor was $241M driven by a $477M mark-to-market equity-method loss from NuScale; management emphasized that adjusted results exclude equity method items .
  • Guidance maintained: 2025 adjusted EBITDA $575–$675M, adjusted EPS $2.25–$2.75, operating cash flow $450–$500M; segment margin ranges re-affirmed, book-to-burn expected >1, revenue growth ~15% .
  • Capital returns accelerated: $142M repurchases in Q1 (3.6M shares), target up to $600M for 2025; backlog $28.7B (79% reimbursable), book-to-burn 1.5x, with strong Urban Solutions awards (EPCM for Indiana pharma, TxDOT SH-6) as catalysts .

What Went Well and What Went Wrong

What Went Well

  • Urban Solutions revenue rose to $2.16B (from $1.48B y/y) and profit to $70M (from $50M), supported by major life sciences and metals awards; ending backlog increased 8% to $20.2B .
  • LNG Canada advanced to final stages with 782/837 systems mechanically complete; commissioning cargo received to cool down equipment, increasing confidence heading into Train 1 startup readiness .
  • G&A fell to $36M (down 39% y/y) on lower performance-based comp; adjusted EBITDA $155M (+76% y/y) and adjusted EPS $0.73 (+55% y/y), reflecting improved normalized performance .
  • CEO tone: “Grow and execute” strategy launched; “clients can rely on Fluor’s project delivery expertise to help navigate the complexities of the market” .
  • CFO tone: “More solid footing financially” with majority reimbursable backlog and robust cash generation outlook; continued commitment to capital returns .

What Went Wrong

  • GAAP net loss of $241M, primarily due to NuScale mark-to-market equity method loss of $477M; FX and legacy project reserve impacts also pressured results .
  • Energy Solutions profit declined to $47M (from $68M y/y) with projects nearing completion and a JV reserve in Mexico; new awards fell to $315M, backlog down to $6.2B (from $9.3B y/y) .
  • Mission Solutions profit fell to $5M (from $22M y/y) on a $28M reserve tied to a 2019 project ruling; lost recompete for Strategic Petroleum Reserve (protest pending) .
  • Operating cash flow was an outflow of $286M (vs. $111M outflow y/y) due to working capital increases on large projects; net interest income fell as cash balances declined on JV projects nearing completion .
  • Total backlog decreased 12.3% y/y to $28.7B (from $32.7B), though still 79% reimbursable and supported by Urban Solutions strength .

Financial Results

Headline metrics vs prior quarters (older → newer)

MetricQ3 2024Q4 2024Q1 2025
Revenue ($USD Billions)$4.094 $4.260 $3.982
GAAP EPS ($)$0.31 $10.57 (GAAP; NuScale deconsolidation) ($1.42)
Adjusted EPS ($)$0.51 $0.48 $0.73
EBITDA ($USD Millions)$97 $205 $100
Adjusted EBITDA ($USD Millions)$124 $154 $155
Consolidated Segment Profit ($USD Millions)$117 $206 $131
Consolidated Segment Margin (%)2.9% 4.8% 3.3%
G&A ($USD Millions)$37 $55 $36
Operating Cash Flow ($USD Millions)$330 in Q3 OCF; nine months $501 2024 full-year $828 ($286)
New Awards ($USD Billions)$2.699 $2.308 $5.811
Backlog ($USD Billions)$31.319 $28.484 $28.718
Book-to-Burn (x)——1.5x

Segment breakdown – Q1 2025 vs Q1 2024

SegmentRevenue Q1 2024 ($USD Billions)Revenue Q1 2025 ($USD Billions)Segment Profit Q1 2024 ($USD Millions)Segment Profit Q1 2025 ($USD Millions)Margin Q1 2024Margin Q1 2025
Urban Solutions$1.479 $2.157 $50 $70 3.4% 3.2%
Energy Solutions$1.432 $1.206 $68 $47 4.7% 3.9%
Mission Solutions$0.601 $0.597 $22 $5 3.7% 0.8%
Other$0.222 $0.022 ($22) $9 NM 40.9%
Total$3.734 $3.982 $118 $131 3.2% 3.3%

KPIs and cash/capital allocation

KPIQ3 2024Q4 2024Q1 2025
Cash & Marketable Securities ($USD Billions)$2.912 $2.829 $2.5 (approx)
Share Repurchases ($USD Millions)—$125 $142
Reimbursable Backlog (%)80% 79% 79%
New Awards Reimbursable (%)——87%
Legacy Project Backlog ($USD Millions)——$585

Guidance Changes

MetricPeriodPrevious Guidance (Feb 18, 2025)Current Guidance (May 2, 2025)Change
Adjusted EBITDA ($USD Millions)FY 2025$575–$675 $575–$675 Maintained
Adjusted EPS ($)FY 2025$2.25–$2.75 $2.25–$2.75 Maintained
Operating Cash Flow ($USD Millions)FY 2025$450–$500 (implied from initial outlook) $450–$500 Maintained
Segment Margins (Urban, Energy, Mission)FY 2025Urban ~4–5%; Energy ~3.5–4.5%; Mission ~5–6% (implied in modeling) Urban ~4–5%; Energy ~3.5–4.5%; Mission ~5–6% Maintained
Book-to-BurnFY 2025>1x (qualitative) >1x Maintained
Revenue GrowthFY 2025~15% (qualitative) ~15% Maintained
Tax Rate Assumption (%)FY 202530–35% 30–35%; Q1 effective ~20%, rising toward ~30% full-year Maintained (timing nuance)
Share Repurchases ($USD Millions)FY 2025$300 planned Up to $600, incl. ~$150 in Q2 Raised

Earnings Call Themes & Trends

TopicQ3 2024 MentionsQ4 2024 MentionsQ1 2025 Current PeriodTrend
Life sciences/ATLSIncremental awards; Urban revenue up y/y Urban Solutions strong, $7.2B revenue FY EPCM for second multi-billion $$ Indiana pharma; ATLS strengthening execution; Urban awards $5.3B Strengthening pipeline; execution ramp
LNG CanadaNot highlighted Not highlighted 782/837 systems MC; commissioning cargo; approaching Train 1 RFSU Nearing completion; milestone-driven
Dow Path2Zero——Construction slowdown; continuing engineering/procurement; client remains committed Timing uncertainty; mitigated by continued FE work
Tariffs/macro——Clients seek clarity on tariffs/trade; some price/GDP-sensitive projects delayed; majority moving forward Mixed macro sensitivity
Mexico JV exposureES cost growth noted in Q3 (MX subcontract) FX and embedded derivatives noted FY Reserve on long-completed JV project; forward exposure limited; 4 major projects, 2 near completion Legacy clean-up; limited forward risk
Data centers——Advancing design under MSA with major tech provider Emerging opportunity
Infrastructure (TxDOT SH-6)——$671–$682M award; SH-6 widening, start summer 2025 New awards drive Urban backlog
Savannah River pit facility——Expect full release in coming quarters Pending DOE decision

Management Commentary

  • CEO: “We are well positioned for the grow and execute chapter… we see substantial opportunities for growth in our key markets… clients can rely on Fluor’s project delivery expertise to help navigate the complexities of the market.” (Jim Breuer) .
  • CFO: “On a much more solid footing financially, supported by a majority reimbursable backlog and a robust outlook for cash generation… enhance operating margins through project execution excellence, lean processes, and risk management discipline.” (John Regan) .
  • CEO on client sentiment: Time-to-market projects (ATLS, Mission Solutions) proceeding; more price/GDP-sensitive projects (energy, copper) require macro clarity; pursuing quality pursuits with high conversion to EPC(M) .
  • CFO on quarterly shape: Adjusted EPS benefited ~$0.08–0.09 from stock price-sensitive comp; descopes pulled forward ~9¢ EPS, ~$40M EBITDA credit spread over 2025 (not entirely one-time) .

Q&A Highlights

  • Guidance shape/midpoint: Management is “more squarely” at the midpoint after normalizing share-price comp tailwind; maintaining EBITDA/EPS/OCF guidance .
  • Cash flow and buybacks: Despite Q1 OCF outflow, April working capital improved; repurchases guided up to $600M in 2025, including ~$150M in Q2 .
  • Project timing/utilization: Dow construction slowdown not indicative of broader trend; backlog earnings potential intact; early procurement buyouts support continuity .
  • Mexico/legacy exposure: Reserve tied to long-completed JV project; forward exposure limited; expecting JV cash collections, more confident in Canada vs. Mexico .
  • Adjustments/one-offs: $84M equity-method benefit from legacy infra verdict not in adjusted EBITDA; descopes pulled-forward profit $20M per segment ($40M total), spread through 2025 .

Estimates Context

MetricQ1 2025 ConsensusQ1 2025 Actual
Primary EPS ($)0.50*0.73*
Revenue ($USD Billions)4.178*3.982*
EBITDA ($USD Millions)122.06*124.00*
# EPS Estimates8*—
# Revenue Estimates7*—

Values retrieved from S&P Global.*

Reference actuals: adjusted EPS/EBITDA per company reconciliation .

Key Takeaways for Investors

  • Q1 2025 normalized performance was strong (adjusted EPS $0.73; adjusted EBITDA $155M), beating EPS/EBITDA consensus, but revenue missed as Energy Solutions slowed and Mission Solutions booked reserves .
  • Guidance intact (EBITDA/EPS/OCF) with segment margin ranges reaffirmed; management commentary suggests execution and backlog earnings potential support the midpoint, albeit with macro timing sensitivity .
  • Capital return is a near-term catalyst: $142M repurchased in Q1; target up to $600M in 2025, signaling confidence in cash generation and supporting per-share metrics .
  • Urban Solutions is the growth engine (life sciences/data centers/infrastructure), evidenced by Indiana EPCM pharma award and TxDOT SH‑6; backlog up to $20.2B, awards $5.3B, book-to-burn 1.5x .
  • LNG Canada nearing critical milestones (commissioning cargo, Train 1 readiness) could drive sentiment; any formal RFSU/production updates would be positive stock catalysts .
  • Risks: NuScale mark-to-market can distort GAAP; Energy Solutions backlog down with projects nearing completion; macro/tariff clarity and Dow site timing are watch items .
  • Near-term trading setup: Expect focus on backlog conversion cadence, Urban awards, and buyback tempo; monitor Q2 awards/book-to-burn and any LNG Canada milestone disclosures for potential upside narrative .

Additional Context – Prior Quarters

  • Q4 2024: Adjusted EBITDA $154M; adjusted EPS $0.48; revenue $4.26B; FY 2025 guidance introduced (EBITDA $575–$675M; EPS $2.25–$2.75) .
  • Q3 2024: Adjusted EPS $0.51; adjusted EBITDA $124M; revenue $4.09B; FY 2024 OCF raised; Energy Solutions profit impacted by MX subcontract cost growth .

Relevant Q1 2025 Press Releases

  • Indiana pharma EPCM award (multi-billion reimbursable, Type 2 diabetes/weight control APIs) recognized in Q1 awards .
  • TxDOT SH‑6 College Station construction award (~$671–$682M), widening 12-mile corridor to 3 lanes each direction; start summer 2025 .
  • Barrick’s Reko Diq JV selected Fluor as lead EPCM partner for major copper-gold project; phase 1 capex contingent on financing, major works in 2025 .

Notes: All adjusted figures per company definitions; adjusted results exclude equity-method items and specified non-routine impacts .