Nuclear Security & Deterrence Monitor Vol. 26 No. 42
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Nuclear Security & Deterrence Monitor
Article 6 of 8
November 04, 2022

Quarterly earnings dip at Fluor, but weapons complex work remains steady

By Wayne Barber

Fluor chair and CEO David Constable is happy to see a joint venture led by his company remain as prime at the Department of Energy’s Savannah River Site in South Carolina for at least four more years, and said Fluor teams will aggressively pursue two big National Nuclear Security Administration contracts.

In an earnings call and slide presentation Friday for Wall Street analysts, Constable touted the recent award of a four-year extension to Fluor-led Savannah River Nuclear Solutions. The deal allows DOE to extend the agreement for an additional year through September 2027. Fluor’s share of the $12 billion extension package is $4.5 billion over four years.

Work done at Savannah River includes nuclear cleanup for the DOE Office of Environmental Management, Constable said. “The site also supports the U.S. government’s non-proliferation efforts by processing and storing nuclear materials,” the CEO added. Savannah River Nuclear Solutions will remain in charge even as Environmental Management prepares to transfer responsibility for the property to the National Nuclear Security Administration (NNSA).

In response to a question during a Friday conference call, Constable said he expects bids for a new management contract for the Pantex Plant in Texas to be due to NNSA around the middle or end of 2023. Proposals for operation of the Y-12 National Security Complex in Oak Ridge, Tenn., will likely be due sometime in 2025, the Fluor CEO said.

The Pantex and Y-12 facilities currently fall under a single management contract held by Bechtel-led Consolidated Nuclear Security.

In May, after contract challenges from rivals, the NNSA did an about-face and canceled a potentially decade-long contract, worth a total of about $30 billion, to replace Consolidated Nuclear Security with a Fluor-led team that included Amentum. The incumbent remains in charge of both plants until the individual procurements are carried out.

Constable said Fluor will employ slightly different strategies for landing Pantex and Y-12 but did not elaborate.

Earnings fell at Fluor, Irving, Texas, in the third quarter, which the international engineering company and government contractor attributed to charges from big infrastructure projects around highways and airports.

Net earnings for the third quarter ended Sept. 30 were $22 million or $0.08 a share, down from $42 million or $0.22 a share, in the year-ago quarter. Quarterly revenue was $3.6 billion, up year-over-year from $3.5 billion.

Quarterly segment operating income for Mission Solutions, where Fluor quarterbacks its government contracting work, was $29 million, up from $28 million a year ago. Segment revenue was $639 million, down from $723 million in the year-ago period.

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