Fluor(US:FLR)2024-02-20 17:26Financial Data and Key Metrics Changes - Revenue for 2023 was $15.5 billion, a 13% increase from 2022 [59] - Full year net income was $139 million, or $0.54 per diluted share, with adjusted EBITDA of $613 million [64] - The company established 2024 adjusted EBITDA guidance at $600 million to $700 million, or $2.50 to $3 per diluted share [13][64] - Ending backlog improved to $14.8 billion from $10.3 billion a year ago, with 71% now being reimbursable [50] Business Line Data and Key Metrics Changes - Urban Solutions segment profit for the quarter was $147 million, up from $38 million a year ago, driven by settlements on longstanding claims [60] - Energy Solutions reported a fourth quarter segment profit of $26 million, down from $124 million in 2022, impacted by project nearing completion and cost growth [62] - Mission Solutions reported a segment profit of $31 million in the fourth quarter compared to $20 million a year ago, with ending backlog at $3.9 billion [40] Market Data and Key Metrics Changes - The company reported a book-to-burn ratio of 1.3x for new awards totaling $19.5 billion in 2023 [59] - The current project mix across all business lines is the most diverse it has been in years, with significant prospects in chemicals, advanced technology, life sciences, and energy transition programs [22] Company Strategy and Development Direction - The company aims to be a leader in professional and technical solutions while maintaining global engineering and construction expertise [18] - Strategic priorities include reinforcing financial discipline, pursuing fair contract terms, driving growth across the portfolio, and fostering a high-performance culture [19] - The company is focused on energy transition markets, with over 200 active projects in this area [9] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory for 2024, expecting it to be similar or better than 2022 and 2023 [70] - The company anticipates significant completion of legacy projects over the next 12 months, supporting revenue growth [15] - Management noted strong interest in capabilities to support intelligence services, with projects representing over $75 billion in total installed cost [8] Other Important Information - The company added 5,000 employees in 2023 to support growth and project execution [29] - The company has made considerable progress in divesting non-core businesses to focus on high-return end markets [67] - The company expects cash flow for 2024 to be between $350 million and $450 million, excluding cash funding for legacy projects [16] Q&A Session Summary Question: What is the expected cadence of bookings in 2024? - Management is comfortable that 2024 will shape up similarly or better than 2022 and 2023, with strong hit rates on project pursuits [70] Question: Can you elaborate on free cash flow expectations? - The expected range for tax settlements is approximately $150 million to $160 million, with less claim settlements anticipated in 2024 compared to 2023 [71] Question: What is the outlook for the mining sector in Saudi Arabia? - Management is very bullish on the mining sector in Saudi Arabia, seeing it as a growth engine for the company [74] Question: Can you provide details on the nuclear opportunities in Eastern Europe? - The company is actively pursuing nuclear opportunities in Romania and Bulgaria, focusing on energy independence and security [101] Question: What is the company's position in the data center market? - The company is engaged in significant data center projects in Asia and sees this as a growing market [103] Question: How is the company addressing the semiconductor and pharmaceutical sectors? - The company expects continued momentum in bookings in the semiconductor and pharmaceutical sectors, particularly with the flow of CHIPS Act funding [106]