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Share Name | Share Symbol | Market | Type |
---|---|---|---|
KBR Inc | NYSE:KBR | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 66.00 | 0 | 09:09:42 |
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ý
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Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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¨
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Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period from to
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Delaware
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20-4536774
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(State of incorporation or organization)
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(I.R.S. Employer Identification No.)
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601 Jefferson Street, Suite 3400, Houston, Texas
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77002
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(Address of principal executive offices)
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(Zip Code)
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Title of each class
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Name of each exchange on which registered
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Common Stock par value $0.001 per share
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New York Stock Exchange
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Large accelerated filer
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ý
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Accelerated filer
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¨
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Non-accelerated filer
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¨
(Do not check if a smaller reporting company)
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Smaller reporting company
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¨
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Page
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FINANCIAL STATEMENTS
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Consolidated Statements of
Operations
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•
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Government Services
: A wide range of professional services across defense, space and government embracing research and development, test and evaluation, program acquisition, program management integration, and program sustainment. These services are mainly for governmental agencies in the United States ("U.S."), United Kingdom ("U.K.") and Australia and also cover other selective countries. These programs are frequently provided on long-term service contracts, with key scientific, technical and program management differentiation. Key customers include U.S. Department of Defense agencies such as the Missile Defense Agency, U.S. Army, U.S. Navy and U.S. Air Force as well as NASA, the U.K. Ministry of Defence, London Metropolitan Police, U.K. Army, other U.K. Crown Services, and the Royal Australian Air Force, Navy and Army.
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•
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Hydrocarbons
: In the global hydrocarbons sector we offer four primary services:
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◦
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Proprietary Technology:
A broad spectrum of front-end services and solutions, including licensing of technologies, basic engineering and design services ("BED"), proprietary equipment ("PEQ"), plant automation services, remote monitoring of plant operations, catalysts, solvents and vessel internals together with specialist consulting services to the hydrocarbons, petrochemicals, chemicals and fertilizer markets. Key technologies in our portfolio are ammonia, nitric acid, ammonia nitrate, ethylene, phenol, bis-phenol A, polycarbonate, catalytic cracking, isomerization, alkylation, solvent de-asphalting and coal degasification.
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Specialized Consulting:
A broad range of specialized consulting services across upstream, midstream, downstream and specialty chemicals; which includes:
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Front-end consulting services related to field development planning, technology selection and capital expenditure optimization;
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Plant integrity management;
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Specialized naval architecture technology (drillships, floating production, storage and offshore ("FPSO"), floating production units ("FPUs") and structural engineering);
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•
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Feasibility studies, revamp studies, planning/development and construction studies for oil and gas (upstream industry), liquefied natural gas ("LNG"), refining, petrochemicals, chemicals and fertilizers (downstream industries).
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◦
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Project Delivery Solutions:
From conceptual design, through front end engineering design and execution planning, to full engineering, procurement and construction ("EPC")/engineering, procurement, construction and maintenance ("EPCM") delivery for the development, construction and commissioning of projects across the entire hydrocarbons value chain, including offshore and onshore oil and gas industries, LNG/ gas to liquids ("GTL") markets, as well as for refining, petrochemicals, chemicals, specialty chemicals and fertilizers industries. KBR has licensed its market leading Ammonia Technology to over 225 Plants globally, and has constructed around 35% of the world’s LNG Capacity.
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◦
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Maintenance and Asset Services
: Through our Brown & Root Industrial Services joint venture in North America and through KBR’s wholly owned Brown & Root entities in the Middle East, Europe (including Poland, Russia and the Netherlands) and APAC, we are a leading provider of engineering, construction, and reliability-driven maintenance solutions for the refinery, petrochemical, chemical, specialty chemicals and fertilizer markets. The focus is on customers seeking to achieve greater asset utilization and reliability to cut costs and increase production from existing assets, including small projects, sustaining capital, turnarounds, maintenance, specialty welding services, and high quality scaffolding. These contracts are generally long-term service contracts.
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◦
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Over the last few years, KBR has migrated into training simulators for a variety of process plants, and remote monitoring operations as part of its journey to digitalization.
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Health, Safety, Security & Environment
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World-class planning, assessment, and execution practices and performance ('Zero Harm')
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People
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Distinctive, competitive and customer-focused culture, through our people ('One KBR')
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Large numbers of employees with U.S. government-issued security clearances
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Customer Relationships
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Customer objectives are placed at the center of our planning and delivery
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Long-term relationships in government services (for example, we have had a contract with NASA since the beginning of the space program) and with major oil and gas customers such as British Petroleum, Chevron Corporation and Shell Corporation.
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Project Delivery
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A reputation for successful delivery of large, complex and difficult projects globally - using world-class processes (the 'KBR Way'), including program management integrator
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Technical Excellence
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Quality, world-class technology, know-how and technical solutions
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Full Life-cycle Asset Support
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Comprehensive asset services through long-term contracts
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Financial Strength
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Through liquidity, capital capacity and ability to support warranties
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Government Services
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Technology & Consulting
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Engineering & Construction
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Non-strategic Business
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Other
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domestic and foreign governments;
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international oil companies and national oil companies;
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independent refiners;
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petrochemical and fertilizer producers;
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developers; and
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manufacturers.
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expropriation and nationalization of our assets in that country;
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political and economic instability;
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civil unrest, acts of terrorism, war or other armed conflict;
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currency fluctuations, devaluations and conversion restrictions;
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confiscatory taxation or other adverse tax policies; or
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governmental activities or judicial actions that limit or disrupt markets, restrict payments, limit the movement of funds, result in the deprivation of contract rights or result in the inability for us to obtain or retain licenses required for operation.
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policy or spending changes implemented by the current administration, defense department or other government agencies;
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changes, delays or cancellations of government programs or requirements;
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adoption of new laws or regulations that affect companies providing services to the governments;
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curtailment of the governments’ outsourcing of services to private contractors; or
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level of political instability due to war, conflict or natural disasters.
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worldwide or regional political, social or civil unrest, military action and economic conditions;
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the level of demand for oil, natural gas, and industrial services;
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governmental regulations or policies, including the policies of governments regarding the use of energy and the exploration for and production and development of their oil and natural gas reserves;
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a reduction in energy demand as a result of energy taxation or a change in consumer spending patterns;
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global economic growth or decline;
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the global level of oil and natural gas production;
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global weather conditions and natural disasters;
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oil refining capacity;
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shifts in end-customer preferences toward fuel efficiency and the use of natural gas;
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potential acceleration of the development and expanded use of alternative fuels;
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environmental regulation, including limitations on fossil fuel consumption based on concerns about its relationship to climate change; and
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reduction in demand for the commodity-based markets in which we operate.
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valuation methodologies may not accurately capture the value proposition;
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future completed acquisitions may not be integrated within our operations with the efficiency and effectiveness initially expected, resulting in a potentially significant detriment to the associated product/service line financial results and posing additional risks to our operations as a whole;
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we may have difficulty managing our growth from acquisition activities;
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key personnel within an acquired organization may resign from their related positions resulting in a significant loss to our strategic and operational efficiency associated with the acquired company;
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the effectiveness of our daily operations may be reduced by the redirection of employees and other resources to acquisition activities;
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we may assume liabilities of an acquired business (e.g. litigation, tax liabilities, contingent liabilities, environmental issues), including liabilities that were unknown at the time of the acquisition, that pose future risks to our working capital needs, cash flows and the profitability of related operations;
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we may assume unprofitable projects that pose future risks to our working capital needs, cash flows and the profitability of related operations;
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business acquisitions may include substantial transactional costs to complete the acquisition that exceed the estimated financial and operational benefits; or
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future acquisitions may require us to obtain additional equity or debt financing, which may not be available on attractive terms, if at all. Moreover, to the extent an acquisition results in additional goodwill, it will reduce our tangible net worth, which might have an adverse effect on our credit capacity.
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requiring us to dedicate cash flow from operations to the repayment of debt, interest and other related amounts, which reduces the funds we have available for other purposes, such as working capital, capital expenditures, acquisitions, payment of dividends and share repurchase programs;
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making it more difficult or expensive for us to obtain any necessary future financing for working capital, capital expenditures, debt service requirements, debt refinancing, acquisitions or other purposes;
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reducing our flexibility in planning for or reacting to changes in our industry and market conditions;
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causing us to be more vulnerable in the event of a downturn in our business;
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exposing us to increased interest rate risk given that a portion of our debt obligations are at variable interest rates; and
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increasing our risk of a covenant violation under our Credit Agreement.
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Location
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Owned/Leased
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Description
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Business Segment
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North America:
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Arlington, Virginia
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Leased
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Office facilities
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Government Services
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Birmingham, Alabama
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Leased
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Office facilities
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Engineering & Construction
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Colorado Springs, Colorado
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Leased
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Office facilities
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Government Services
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Columbia, Maryland
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Leased
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Office facilities
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Government Services
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Huntsville, Alabama
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Leased
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Office facilities
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Government Services
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Houston, Texas
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Leased
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Office facilities
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All
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Monterrey, Nuevo Leon, Mexico
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Leased
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Office facilities
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Engineering & Construction
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Newark, Delaware
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Leased
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Office facilities
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Engineering & Construction
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Europe, Middle East and Africa:
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Leatherhead, United Kingdom
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Owned
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Office facilities
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All
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Al Khobar, Saudi Arabia
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Leased
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Office facilities
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Engineering & Construction
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Asia-Pacific:
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Singapore
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Leased
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Office facilities
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Engineering & Construction
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South Brisbane, Australia
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Leased
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Office facilities
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Engineering & Construction
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Sydney, Australia
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Leased
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Office facilities
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Engineering & Construction
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Perth, Australia
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Leased
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Office and project facilities
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Technology & Consulting and Engineering & Construction
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Chennai, India
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Leased
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Office and project facilities
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All
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Item 5.
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Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
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Common Stock Price Range
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Dividends
Declared
Per Share
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High
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Low
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|||||||
Fiscal Year 2016
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||||||
First quarter ended March 31, 2016
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$
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17.10
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$
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11.60
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$
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0.08
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Second quarter ended June 30, 2016
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$
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15.92
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$
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12.08
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$
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0.08
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Third quarter ended September 30, 2016
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$
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15.89
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$
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12.69
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$
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0.08
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Fourth quarter ended December 31, 2016
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$
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17.95
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$
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13.16
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$
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0.08
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Fiscal Year 2015
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First quarter ended March 31, 2015
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$
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18.35
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$
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14.00
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$
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0.08
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Second quarter ended June 30, 2015
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$
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20.77
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$
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14.30
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$
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0.08
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Third quarter ended September 30, 2015
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$
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19.65
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$
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15.64
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$
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0.08
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Fourth quarter ended December 31, 2015
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$
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19.94
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$
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16.34
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$
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0.08
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Purchase Period
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Total Number
of Shares
Purchased
(1)
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Average
Price Paid
per Share
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Total Number of
Shares Purchased
as Part of Publicly
Announced Plan
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Dollar Value of Maximum Number of Shares that May Yet Be
Purchased Under the Plan
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||||||
October 1 – 31, 2016
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29,916
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$
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14.90
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—
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$
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208,030,228
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November 1 – 30, 2016
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226
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$
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16.99
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—
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$
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208,030,228
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December 1 – 31, 2016
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58,596
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$
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17.55
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—
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$
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208,030,228
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(1)
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The shares reported herein consist solely of shares acquired from employees in connection with the settlement of income tax and related benefit withholding obligations arising from issuance of share-based equity awards under the KBR Stock and Incentive Plan. A total of
88,738
shares were acquired from employees during the three months ended
December 31, 2016
at an average price of
$16.66
per share.
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12/31/2011
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12/31/2012
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12/31/2013
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12/31/2014
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12/31/2015
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12/31/2016
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||||||||||||
KBR
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$
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100.00
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$
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108.09
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$
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115.21
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$
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61.24
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$
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61.13
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$
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60.30
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Dow Jones Heavy Construction
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$
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100.00
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$
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120.81
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$
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157.90
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$
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116.99
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$
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102.82
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$
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125.91
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Russell 1000
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$
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100.00
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$
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113.92
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$
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148.60
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$
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165.05
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$
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163.25
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$
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179.08
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Years Ended December 31,
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Dollars in millions, except per share amounts
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2016
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2015
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2014
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2013
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2012
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Statements of Operations Data:
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||||||||||
Revenues
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$
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4,268
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$
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5,096
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$
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6,366
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$
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7,214
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$
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7,770
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Gross profit (loss)
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112
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325
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(65
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)
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417
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518
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|||||
Equity in earnings of unconsolidated affiliates
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91
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149
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163
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137
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151
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|||||
Impairment of goodwill, asset impairments and restructuring charges (a)
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(39
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)
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(70
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)
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(660
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)
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—
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(180
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)
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|||||
Operating income (loss) (b)
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28
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310
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(794
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)
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308
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|
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299
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|||||
Net income (loss) (c)
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(51
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)
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226
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(1,198
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)
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171
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|
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202
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|||||
Net income attributable to noncontrolling interests
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(10
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)
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(23
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)
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(64
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)
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(96
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)
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(58
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)
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|||||
Net income (loss) attributable to KBR
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(61
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)
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203
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(1,262
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)
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75
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|
144
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|||||
Basic net income (loss) attributable to KBR per share
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$
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(0.43
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)
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$
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1.40
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$
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(8.66
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)
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$
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0.50
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|
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$
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0.97
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Diluted net income (loss) attributable to KBR per share
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$
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(0.43
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)
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$
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1.40
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|
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$
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(8.66
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)
|
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$
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0.50
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|
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$
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0.97
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Cash dividends declared per share
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$
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0.32
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$
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0.32
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$
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0.32
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|
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$
|
0.24
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|
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$
|
0.28
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|
|
|
|
|
|
|
|
|
|
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|
||||||||||
Balance Sheet Data (as of the end of period):
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|
|
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|
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||||||||||
Total assets (d)
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$
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4,144
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$
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3,412
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|
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$
|
4,078
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|
|
$
|
5,422
|
|
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$
|
5,752
|
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Long-term nonrecourse project-finance debt
|
|
34
|
|
|
51
|
|
|
63
|
|
|
78
|
|
|
84
|
|
|||||
Long-term revolving credit agreement debt
|
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650
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|
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—
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|
|
—
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|
|
—
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|
|
—
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|
|||||
Total shareholders’ equity
|
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$
|
745
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|
|
$
|
1,052
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|
|
$
|
935
|
|
|
$
|
2,439
|
|
|
$
|
2,511
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other Financial Data (as of the end of period):
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Backlog of unfulfilled orders (e)
|
|
$
|
10,938
|
|
|
$
|
12,333
|
|
|
$
|
10,859
|
|
|
$
|
14,118
|
|
|
$
|
14,931
|
|
|
(a)
|
Included in 2016 and 2015 are asset impairment and restructuring charges of
$39 million
and
$70 million
, respectively. The 2014 balance includes a goodwill impairment charge of
$446 million
related to three of our previous reporting units, long-lived assets impairment charge of
$171 million
and restructuring charges of
$43 million
. Included in 2012 is a goodwill impairment charge of
$178 million
related to one of our previous reporting units and a
$2 million
long-lived asset impairment charge.
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(b)
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Includes gains on disposal of assets of
$7 million
,
$61 million
,
$7 million
,
$2 million
and
$32 million
for the years ended 2016, 2015, 2014, 2013, and 2012, respectively.
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(c)
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Included in 2014 is
$421 million
of tax expense primarily related to valuation allowance on U.S. federal, foreign and state net operating loss carryforwards, foreign tax credit carryforwards, other deferred tax assets and foreign tax expense.
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(d)
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The impact of adopting Accounting Standards Update ("ASU") 2015-17 resulted in a decrease in total assets of
$121 million
,
$16 million
, and
$15 million
for the years ended 2014, 2013 and 2012, respectively.
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(e)
|
Prior to the second quarter of 2015, the amount included in backlog for long-term contracts associated with the U.K. government's PFIs was limited to five years. In the second quarter of 2015, we modified our backlog policy to record the estimated value of all work forecasted to be performed under these arrangements.
|
Item 7.
|
Management’s Discussion and Analysis of Financial Condition and Results of Operations
|
Equity in Earnings of Unconsolidated Affiliates
|
|||||||||||||||||||||||||
|
|
|
|
|
2016 vs. 2015
|
|
|
|
2015 vs. 2014
|
||||||||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
$
|
|
%
|
|
2014
|
|
$
|
|
%
|
||||||||||||
Equity in earnings of unconsolidated affiliates
|
$
|
91
|
|
|
$
|
149
|
|
|
$
|
(58
|
)
|
|
(39
|
)%
|
|
$
|
163
|
|
|
$
|
(14
|
)
|
|
(9
|
)%
|
General and Administrative Expenses
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
|
|
|
2016 vs. 2015
|
|
|
|
2015 vs. 2014
|
||||||||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
$
|
|
%
|
|
2014
|
|
$
|
|
%
|
||||||||||||
General and administrative expenses
|
$
|
(143
|
)
|
|
$
|
(155
|
)
|
|
$
|
(12
|
)
|
|
(8
|
)%
|
|
$
|
(239
|
)
|
|
$
|
(84
|
)
|
|
(35
|
)%
|
Gain on Disposition of Assets
|
|
|
|
|
|
|
|
||||||||||||||||||
|
|
|
|
|
2016 vs. 2015
|
|
|
|
2015 vs. 2014
|
||||||||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
$
|
|
%
|
|
2014
|
|
$
|
|
%
|
||||||||||||
Gain on disposition of assets
|
$
|
7
|
|
|
$
|
61
|
|
|
$
|
(54
|
)
|
|
(89
|
)%
|
|
$
|
7
|
|
|
$
|
54
|
|
|
771
|
%
|
Net Income Attributable to Noncontrolling Interests
|
|||||||||||||||||||||||||
|
|
|
|
|
2016 vs. 2015
|
|
|
|
2015 vs. 2014
|
||||||||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
$
|
|
%
|
|
2014
|
|
$
|
|
%
|
||||||||||||
Net income attributable to noncontrolling interests
|
$
|
(10
|
)
|
|
$
|
(23
|
)
|
|
$
|
(13
|
)
|
|
(57
|
)%
|
|
$
|
(64
|
)
|
|
$
|
(41
|
)
|
|
(64
|
)%
|
|
Years Ended December 31,
|
||||||||||||||||||||||||
|
|
|
|
|
2016 vs. 2015
|
|
|
|
2015 vs. 2014
|
||||||||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
$
|
|
%
|
|
2014
|
|
$
|
|
%
|
||||||||||||
Revenues
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Government Services
|
$
|
1,359
|
|
|
$
|
663
|
|
|
$
|
696
|
|
|
105
|
%
|
|
$
|
638
|
|
|
$
|
25
|
|
|
4
|
%
|
Technology & Consulting
|
347
|
|
|
324
|
|
|
23
|
|
|
7
|
%
|
|
353
|
|
|
(29
|
)
|
|
(8
|
)%
|
|||||
Engineering & Construction
|
2,352
|
|
|
3,454
|
|
|
(1,102
|
)
|
|
(32
|
)%
|
|
4,584
|
|
|
(1,130
|
)
|
|
(25
|
)%
|
|||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|||||
Subtotal
|
$
|
4,058
|
|
|
$
|
4,441
|
|
|
$
|
(383
|
)
|
|
(9
|
)%
|
|
$
|
5,575
|
|
|
$
|
(1,134
|
)
|
|
(20
|
)%
|
Non-strategic Business
|
210
|
|
|
655
|
|
|
(445
|
)
|
|
(68
|
)%
|
|
791
|
|
|
(136
|
)
|
|
(17
|
)%
|
|||||
Total
|
$
|
4,268
|
|
|
$
|
5,096
|
|
|
$
|
(828
|
)
|
|
(16
|
)%
|
|
$
|
6,366
|
|
|
$
|
(1,270
|
)
|
|
(20
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gross profit (loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Government Services
|
$
|
137
|
|
|
$
|
(3
|
)
|
|
140
|
|
|
n/m
|
|
|
$
|
(32
|
)
|
|
$
|
29
|
|
|
91
|
%
|
|
Technology & Consulting
|
73
|
|
|
77
|
|
|
(4
|
)
|
|
(5
|
)%
|
|
53
|
|
|
24
|
|
|
45
|
%
|
|||||
Engineering & Construction
|
7
|
|
|
224
|
|
|
(217
|
)
|
|
(97
|
)%
|
|
141
|
|
|
83
|
|
|
59
|
%
|
|||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|||||
Subtotal
|
$
|
217
|
|
|
$
|
298
|
|
|
$
|
(81
|
)
|
|
(27
|
)%
|
|
$
|
162
|
|
|
$
|
136
|
|
|
84
|
%
|
Non-strategic Business
|
(105
|
)
|
|
27
|
|
|
(132
|
)
|
|
(489
|
)%
|
|
(227
|
)
|
|
254
|
|
|
112
|
%
|
|||||
Total
|
$
|
112
|
|
|
$
|
325
|
|
|
$
|
(213
|
)
|
|
(66
|
)%
|
|
$
|
(65
|
)
|
|
$
|
390
|
|
|
n/m
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Equity in earnings of unconsolidated affiliates
|
|
|
|
|
|
|
|
|
|||||||||||||||||
Government Services
|
$
|
39
|
|
|
$
|
45
|
|
|
$
|
(6
|
)
|
|
(13
|
)%
|
|
$
|
73
|
|
|
$
|
(28
|
)
|
|
(38
|
)%
|
Technology & Consulting
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|||||
Engineering & Construction
|
52
|
|
|
104
|
|
|
(52
|
)
|
|
(50
|
)%
|
|
90
|
|
|
14
|
|
|
16
|
%
|
|||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|||||
Subtotal
|
$
|
91
|
|
|
$
|
149
|
|
|
$
|
(58
|
)
|
|
(39
|
)%
|
|
$
|
163
|
|
|
$
|
(14
|
)
|
|
(9
|
)%
|
Non-strategic Business
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|
—
|
|
|
—
|
|
|
—
|
%
|
|||||
Total
|
$
|
91
|
|
|
$
|
149
|
|
|
$
|
(58
|
)
|
|
(39
|
)%
|
|
$
|
163
|
|
|
$
|
(14
|
)
|
|
(9
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total general and administrative expense
|
$
|
(143
|
)
|
|
$
|
(155
|
)
|
|
$
|
(12
|
)
|
|
(8
|
)%
|
|
$
|
(239
|
)
|
|
$
|
(84
|
)
|
|
(35
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Impairment of goodwill
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
—
|
%
|
|
$
|
(446
|
)
|
|
$
|
(446
|
)
|
|
(100
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset impairment and restructuring charges
|
$
|
(39
|
)
|
|
$
|
(70
|
)
|
|
$
|
(31
|
)
|
|
(44
|
)%
|
|
$
|
(214
|
)
|
|
$
|
(144
|
)
|
|
(67
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Gain on disposition of assets
|
$
|
7
|
|
|
$
|
61
|
|
|
$
|
(54
|
)
|
|
(89
|
)%
|
|
$
|
7
|
|
|
$
|
54
|
|
|
771
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Total operating income (loss)
|
$
|
28
|
|
|
$
|
310
|
|
|
$
|
(282
|
)
|
|
(91
|
)%
|
|
$
|
(794
|
)
|
|
$
|
1,104
|
|
|
139
|
%
|
|
Dollars in millions
|
December 31, 2015
|
|
New Awards
|
|
Other (a)
|
|
Net Workoff (b)
|
|
December 31, 2016
|
||||||||||
Government Services
|
$
|
6,516
|
|
|
$
|
1,847
|
|
|
$
|
856
|
|
|
$
|
(1,398
|
)
|
|
$
|
7,821
|
|
Technology & Consulting
|
430
|
|
|
228
|
|
|
2
|
|
|
(347
|
)
|
|
313
|
|
|||||
Engineering & Construction
|
5,148
|
|
|
526
|
|
|
(501
|
)
|
|
(2,404
|
)
|
|
2,769
|
|
|||||
Subtotal
|
12,094
|
|
|
2,601
|
|
|
357
|
|
|
(4,149
|
)
|
|
10,903
|
|
|||||
Non-strategic Business
|
239
|
|
|
—
|
|
|
6
|
|
|
(210
|
)
|
|
35
|
|
|||||
Total backlog
|
$
|
12,333
|
|
|
$
|
2,601
|
|
|
$
|
363
|
|
|
$
|
(4,359
|
)
|
|
$
|
10,938
|
|
|
(a)
|
Other includes adjustments for (i) backlog acquired from acquisitions during the period of
$1.0 billion
, (ii) effects of changes in foreign exchange rates, primarily related to adverse movements in the British pound of
$(1.1) billion
, (iii) changes in scope on existing projects of
$2.1 billion
and (iv) elimination of our proportionate share of revenue workoff from our unconsolidated joint ventures of
$(1.7) billion
less equity in earnings
|
(b)
|
These amounts represent the revenue workoff on our projects plus equity earnings from our unconsolidated joint venture projects.
|
Cash flows activities summary
|
|
|
|
|
|
|
||||||
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
|
2016
|
|
2015
|
|
2014
|
||||||
Cash flows provided by operating activities
|
|
$
|
61
|
|
|
$
|
47
|
|
|
$
|
170
|
|
Cash flows (used in) provided by investing activities
|
|
(981
|
)
|
|
101
|
|
|
(44
|
)
|
|||
Cash flows provided by (used in) financing activities
|
|
584
|
|
|
(192
|
)
|
|
(210
|
)
|
|||
Effect of exchange rate changes on cash
|
|
(11
|
)
|
|
(43
|
)
|
|
(52
|
)
|
|||
Decrease in cash and equivalents
|
|
$
|
(347
|
)
|
|
$
|
(87
|
)
|
|
$
|
(136
|
)
|
•
|
Accounts receivable is impacted by the timing and collections on billings to our customers. The decrease in accounts receivable in
2016
is primarily due to collections from customers on three large EPC projects within our E&C business segment as well as collections of retainage and trade receivables associated with the substantial completion of a power project within our Non-strategic business segment. We also increased collections from customers on various projects in our T&C business segment. These decreases in accounts receivable were partially offset by increased billings on various Wyle and KTS projects and the expansion of existing U.S. government and other contracts within our GS business segment in
2016
.
|
•
|
Our CIE was impacted by the timing of billings to our customers and is generally related to our cost reimbursable projects where we bill as we incur project costs. In 2016, CIE decreased in our T&C and E&C business segments and was partially offset by the expansion of existing U.S. government and other projects in our GS business.
|
•
|
Accounts payable is impacted by the timing of receipts of invoices from our vendors and subcontractors and payments on these invoices. The increase in accounts payable in
2016
was primarily due to a U.S. government project and other projects from the Wyle and KTS acquired within our GS business segment as well as the timing of invoicing and payments within the normal course of business.
|
•
|
BIE is associated with our fixed price projects, which we generally structure to be cash positive, and is impacted by the timing of achievement of billing of milestones and payments received from our customers in advance of incurring project costs. The increase in BIE is due primarily to
increases associated with two EPC ammonia projects in the U.S. in our E&C business segment partially offset by decreases from various projects in our T&C business segment and a power project in our Non-strategic business unit.
|
•
|
In addition, we received distributions of earnings from our unconsolidated affiliates of
$56 million
and contributed
$41 million
to our pension funds in
2016
.
|
•
|
Accounts receivable decreased primarily due to the timing of collections on customer billings related to projects within our E&C business segment including an EPC LNG project in Australia as well as several EPC power projects in the U.S. in our Non-strategic business segment.
|
•
|
The decrease in CIE primarily reflected the timing of billings as we substantially completed execution of several major EPC projects within our E&C business segment. Additionally, CIE decreased on various projects in Canada prior to the deconsolidation of our Industrial Services Americas business in the third quarter of 2015.
|
•
|
Accounts payable decreased in
2015
due to the timing of invoicing and payments within the normal course of business on an EPC LNG project in Australia and several EPC projects in the U.S. within our E&C business segment. Also contributing to the decrease were certain projects in Canada from our Industrial Services Americas business as well as various projects in the U.K. in our GS business segment and a power project in our Non-strategic business segment.
|
•
|
In 2015, we received distributions of earnings from our unconsolidated affiliates of
$92 million
. We used
$44 million
for the net settlement of derivative contracts and contributed approximately
$48 million
to our pension funds in
2015
.
|
•
|
Accounts receivable decreased primarily due to the timing of collections on customer billings related to projects within our E&C business segment including an LNG project in Africa that was nearing completion and various other projects in Canada and the U.S.
|
•
|
The increase in CIE in
2014
primarily reflected the timing of billings as we substantially completed execution of major projects within our E&C business segment partially offset by increases on U.S government contracts in our GS business segment.
|
•
|
BIE increased in
2014
, reflecting the timing of our achievement of billing milestones and the receipt of payment in advance of incurring costs related to a power project within our Non-strategic Business segment as well as several projects in our E&C business segment.
|
•
|
We received distributions of earnings from our unconsolidated affiliates of
$249 million
. We used
$40 million
for the net settlement of derivative contracts and contributed approximately
$48 million
to our pension funds in
2014
.
|
|
Payments Due
|
||||||||||||||||||||||||||
Dollars in millions
|
2017
|
|
2018
|
|
2019
|
|
2020
|
|
2021
|
|
Thereafter
|
|
Total
|
||||||||||||||
Operating leases (a)
|
$
|
97
|
|
|
$
|
85
|
|
|
$
|
75
|
|
|
$
|
66
|
|
|
$
|
61
|
|
|
$
|
324
|
|
|
$
|
708
|
|
Purchase obligations (b)
|
8
|
|
|
6
|
|
|
5
|
|
|
3
|
|
|
3
|
|
|
1
|
|
|
26
|
|
|||||||
Pension funding obligation (c)
|
36
|
|
|
35
|
|
|
35
|
|
|
35
|
|
|
35
|
|
|
240
|
|
|
416
|
|
|||||||
Revolving credit agreement
|
—
|
|
|
—
|
|
|
—
|
|
|
650
|
|
|
—
|
|
|
—
|
|
|
650
|
|
|||||||
Interest (d)
|
15
|
|
|
15
|
|
|
15
|
|
|
11
|
|
|
—
|
|
|
—
|
|
|
56
|
|
|||||||
Nonrecourse project finance debt
|
8
|
|
|
9
|
|
|
10
|
|
|
10
|
|
|
5
|
|
|
1
|
|
|
43
|
|
|||||||
Total (e)
|
$
|
164
|
|
|
$
|
150
|
|
|
$
|
140
|
|
|
$
|
775
|
|
|
$
|
104
|
|
|
$
|
566
|
|
|
$
|
1,899
|
|
|
(a)
|
Amounts presented are net of subleases.
|
(b)
|
In the ordinary course of business, we enter into commitments for the purchase or lease of software, materials, supplies and similar items. The purchase obligations can span several years depending on the duration of the projects. The purchase obligations disclosed above do not include purchase obligations that we enter into with vendors in the normal course of business that support existing contracting arrangements with our customers. We expect to recover such obligations from our customers.
|
(c)
|
Included in our pension obligations are payments related to our agreement with the trustees of our international plan. The agreement calls for minimum contributions of
£28 million
in 2016 through 2028. The foreign funding obligations were converted to U.S. dollars using the conversion rate as of
December 31, 2016
. KBR, Inc. has provided a guarantee for up to
£95 million
in support of Kellogg Brown & Root (U.K.) Limited's obligation to make payments to the plan in respect of its liability under the U.K. Pensions Act 1995.
|
(d)
|
Determined based on borrowings outstanding at the end of 2016 using the interest rate in effect at that time and, for our outstanding long-term debt, concluding with the expiration date of the Credit Agreement.
|
(e)
|
Not included in the total are uncertain tax positions recorded pursuant to Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") 740 - Income Taxes, which totaled
$261 million
as of
December 31, 2016
. The ultimate timing of settlement of these obligations cannot be determined with reasonable assurance and have been excluded from the table above. See Note
14
to our consolidated financial statements for further discussion on income taxes.
|
|
Effect on
|
||||||||||
|
Pretax Pension Cost in 2017
|
|
Pension Benefit Obligation at December 31, 2016
|
||||||||
Dollars in millions
|
U.S.
|
|
U.K.
|
|
U.S.
|
|
U.K.
|
||||
25-basis-point decrease in discount rate
|
—
|
|
|
1
|
|
|
2
|
|
|
99
|
|
25-basis-point increase in discount rate
|
—
|
|
|
(1
|
)
|
|
(2
|
)
|
|
(93
|
)
|
25-basis-point decrease in expected long-term rate of return
|
1
|
|
|
3
|
|
|
N/A
|
|
|
N/A
|
|
25-basis-point increase in expected long-term rate of return
|
—
|
|
|
(3
|
)
|
|
N/A
|
|
|
N/A
|
|
|
|
|
|
|
Page No.
|
|
||
|
||
|
||
|
||
|
||
|
||
|
|
Years ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
|
|
|
|
||||||
Revenues
|
$
|
4,268
|
|
|
$
|
5,096
|
|
|
$
|
6,366
|
|
Cost of revenues
|
(4,156
|
)
|
|
(4,771
|
)
|
|
(6,431
|
)
|
|||
Gross profit (loss)
|
112
|
|
|
325
|
|
|
(65
|
)
|
|||
Equity in earnings of unconsolidated affiliates
|
91
|
|
|
149
|
|
|
163
|
|
|||
General and administrative expenses
|
(143
|
)
|
|
(155
|
)
|
|
(239
|
)
|
|||
Impairment of goodwill
|
—
|
|
|
—
|
|
|
(446
|
)
|
|||
Asset impairment and restructuring charges
|
(39
|
)
|
|
(70
|
)
|
|
(214
|
)
|
|||
Gain on disposition of assets
|
7
|
|
|
61
|
|
|
7
|
|
|||
Operating income (loss)
|
28
|
|
|
310
|
|
|
(794
|
)
|
|||
Other non-operating income
|
5
|
|
|
2
|
|
|
17
|
|
|||
Income (loss) before income taxes and noncontrolling interests
|
33
|
|
|
312
|
|
|
(777
|
)
|
|||
Provision for income taxes
|
(84
|
)
|
|
(86
|
)
|
|
(421
|
)
|
|||
Net income (loss)
|
(51
|
)
|
|
226
|
|
|
(1,198
|
)
|
|||
Net income attributable to noncontrolling interests
|
(10
|
)
|
|
(23
|
)
|
|
(64
|
)
|
|||
Net income (loss) attributable to KBR
|
$
|
(61
|
)
|
|
$
|
203
|
|
|
$
|
(1,262
|
)
|
Net income (loss) attributable to KBR per share:
|
|
|
|
|
|
||||||
Basic
|
$
|
(0.43
|
)
|
|
$
|
1.40
|
|
|
$
|
(8.66
|
)
|
Diluted
|
$
|
(0.43
|
)
|
|
$
|
1.40
|
|
|
$
|
(8.66
|
)
|
Basic weighted average common shares outstanding
|
142
|
|
|
144
|
|
|
146
|
|
|||
Diluted weighted average common shares outstanding
|
142
|
|
|
144
|
|
|
146
|
|
|||
Cash dividends declared per share
|
$
|
0.32
|
|
|
$
|
0.32
|
|
|
$
|
0.32
|
|
|
Years ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(51
|
)
|
|
$
|
226
|
|
|
$
|
(1,198
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
||||||
Foreign currency translation adjustments:
|
|
|
|
|
|
||||||
Foreign currency translation adjustments, net of tax
|
7
|
|
|
(68
|
)
|
|
(71
|
)
|
|||
Reclassification adjustment included in net income
|
—
|
|
|
4
|
|
|
1
|
|
|||
Foreign currency translation adjustments, net of tax of $(3), $(3) and $4
|
7
|
|
|
(64
|
)
|
|
(70
|
)
|
|||
Pension and post-retirement benefits, net of tax:
|
|
|
|
|
|
||||||
Actuarial gains (losses), net of tax
|
(249
|
)
|
|
71
|
|
|
(96
|
)
|
|||
Reclassification adjustment included in net income
|
24
|
|
|
39
|
|
|
34
|
|
|||
Pension and post-retirement benefits, net of taxes of $45, $(22) and $10
|
(225
|
)
|
|
110
|
|
|
(62
|
)
|
|||
Changes in fair value of derivatives:
|
|
|
|
|
|
||||||
Changes in fair value of derivatives, net of tax
|
—
|
|
|
—
|
|
|
(2
|
)
|
|||
Reclassification adjustment included in net income
|
(1
|
)
|
|
1
|
|
|
—
|
|
|||
Changes in fair value of derivatives, net of taxes of $0, $0 and $0
|
(1
|
)
|
|
1
|
|
|
(2
|
)
|
|||
Other comprehensive income (loss), net of tax
|
(219
|
)
|
|
47
|
|
|
(134
|
)
|
|||
Comprehensive income (loss)
|
(270
|
)
|
|
273
|
|
|
(1,332
|
)
|
|||
Less: Comprehensive income attributable to noncontrolling interests
|
(10
|
)
|
|
(25
|
)
|
|
(66
|
)
|
|||
Comprehensive income (loss) attributable to KBR
|
$
|
(280
|
)
|
|
$
|
248
|
|
|
$
|
(1,398
|
)
|
|
December 31,
|
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Assets
|
|
|
|
||||
Current assets:
|
|
|
|
||||
Cash and equivalents
|
$
|
536
|
|
|
$
|
883
|
|
Accounts receivable, net of allowance for doubtful accounts of $14 and $17
|
592
|
|
|
628
|
|
||
Costs and estimated earnings in excess of billings on uncompleted contracts ("CIE")
|
416
|
|
|
224
|
|
||
Claims receivable
|
400
|
|
|
—
|
|
||
Other current assets
|
103
|
|
|
109
|
|
||
Total current assets
|
2,047
|
|
|
1,844
|
|
||
Claims and accounts receivable
|
131
|
|
|
526
|
|
||
Property, plant, and equipment, net of accumulated depreciation of $324 and $352 (including net PPE of $36 and $48 owned by a variable interest entity)
|
145
|
|
|
169
|
|
||
Goodwill
|
959
|
|
|
324
|
|
||
Intangible assets, net of accumulated amortization of $100 and $91
|
248
|
|
|
35
|
|
||
Equity in and advances to unconsolidated affiliates
|
369
|
|
|
281
|
|
||
Deferred income taxes
|
118
|
|
|
99
|
|
||
Other assets
|
127
|
|
|
134
|
|
||
Total assets
|
$
|
4,144
|
|
|
$
|
3,412
|
|
Liabilities and Shareholders’ Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
535
|
|
|
$
|
438
|
|
Billings in excess of costs and estimated earnings on uncompleted contracts ("BIE")
|
552
|
|
|
509
|
|
||
Accrued salaries, wages and benefits
|
171
|
|
|
173
|
|
||
Nonrecourse project debt
|
9
|
|
|
10
|
|
||
Other current liabilities
|
292
|
|
|
263
|
|
||
Total current liabilities
|
1,559
|
|
|
1,393
|
|
||
Pension obligations
|
526
|
|
|
333
|
|
||
Employee compensation and benefits
|
113
|
|
|
105
|
|
||
Income tax payable
|
78
|
|
|
78
|
|
||
Deferred income taxes
|
149
|
|
|
94
|
|
||
Nonrecourse project debt
|
34
|
|
|
51
|
|
||
Revolving credit agreement
|
650
|
|
|
—
|
|
||
Deferred income from unconsolidated affiliates
|
90
|
|
|
100
|
|
||
Other liabilities
|
200
|
|
|
206
|
|
||
Total liabilities
|
3,399
|
|
|
2,360
|
|
||
KBR shareholders’ equity:
|
|
|
|
||||
Preferred stock, $0.001 par value, 50,000,000 shares authorized, 0 shares issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value, 300,000,000 shares authorized, 175,913,310 and 175,108,100 shares issued, and 142,803,782 and 142,058,356 shares outstanding
|
—
|
|
|
—
|
|
||
Paid-in capital in excess of par ("PIC")
|
2,088
|
|
|
2,070
|
|
||
Accumulated other comprehensive loss ("AOCL")
|
(1,050
|
)
|
|
(831
|
)
|
||
Retained earnings
|
488
|
|
|
595
|
|
||
Treasury stock, 33,109,528 shares and 33,049,744 shares, at cost
|
(769
|
)
|
|
(769
|
)
|
||
Total KBR shareholders’ equity
|
757
|
|
|
1,065
|
|
||
Noncontrolling interests
|
(12
|
)
|
|
(13
|
)
|
||
Total shareholders’ equity
|
745
|
|
|
1,052
|
|
||
Total liabilities and shareholders’ equity
|
$
|
4,144
|
|
|
$
|
3,412
|
|
|
December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
|
|
|
|
||||||
Balance at January 1,
|
$
|
1,052
|
|
|
$
|
935
|
|
|
$
|
2,439
|
|
Acquisition of noncontrolling interest
|
—
|
|
|
(40
|
)
|
|
—
|
|
|||
Share-based compensation
|
18
|
|
|
18
|
|
|
22
|
|
|||
Common stock issued upon exercise of stock options
|
—
|
|
|
1
|
|
|
4
|
|
|||
Tax benefit decrease related to share-based plans
|
1
|
|
|
—
|
|
|
—
|
|
|||
Dividends declared to shareholders
|
(46
|
)
|
|
(47
|
)
|
|
(47
|
)
|
|||
Repurchases of common stock
|
(4
|
)
|
|
(62
|
)
|
|
(106
|
)
|
|||
Issuance of employee stock purchase plan ("ESPP") shares
|
3
|
|
|
5
|
|
|
4
|
|
|||
Investments by noncontrolling interests
|
—
|
|
|
—
|
|
|
10
|
|
|||
Distributions to noncontrolling interests
|
(9
|
)
|
|
(28
|
)
|
|
(61
|
)
|
|||
Other noncontrolling interests activity
|
—
|
|
|
(3
|
)
|
|
2
|
|
|||
Comprehensive income (loss)
|
(270
|
)
|
|
273
|
|
|
(1,332
|
)
|
|||
Balance at December 31,
|
$
|
745
|
|
|
$
|
1,052
|
|
|
$
|
935
|
|
KBR, Inc.
Consolidated Statements of Cash Flows
(In millions)
|
|||||||||||
|
Years ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
|
|
|
|
||||||
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(51
|
)
|
|
$
|
226
|
|
|
$
|
(1,198
|
)
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
45
|
|
|
39
|
|
|
72
|
|
|||
Equity in earnings of unconsolidated affiliates
|
(91
|
)
|
|
(149
|
)
|
|
(163
|
)
|
|||
Deferred income tax expense
|
18
|
|
|
14
|
|
|
353
|
|
|||
Gain on disposition of assets
|
(7
|
)
|
|
(61
|
)
|
|
(7
|
)
|
|||
Gain on negotiated settlement with former parent
|
—
|
|
|
—
|
|
|
(24
|
)
|
|||
Impairment of goodwill
|
—
|
|
|
—
|
|
|
446
|
|
|||
Asset impairment
|
16
|
|
|
31
|
|
|
171
|
|
|||
Other
|
3
|
|
|
21
|
|
|
11
|
|
|||
Changes in operating assets and liabilities, net of acquired businesses:
|
|
|
|
|
|
||||||
Accounts receivable, net of allowance for doubtful accounts
|
121
|
|
|
41
|
|
|
170
|
|
|||
Costs and estimated earnings in excess of billings on uncompleted contracts
|
8
|
|
|
224
|
|
|
(107
|
)
|
|||
Accounts payable
|
(6
|
)
|
|
(274
|
)
|
|
(10
|
)
|
|||
Billings in excess of costs and estimated earnings on uncompleted contracts
|
33
|
|
|
(2
|
)
|
|
144
|
|
|||
Accrued salaries, wages and benefits
|
(50
|
)
|
|
(8
|
)
|
|
(29
|
)
|
|||
Reserve for loss on uncompleted contracts
|
(5
|
)
|
|
(94
|
)
|
|
57
|
|
|||
(Advances to) payments from unconsolidated affiliates, net
|
(1
|
)
|
|
10
|
|
|
13
|
|
|||
Distributions of earnings from unconsolidated affiliates
|
56
|
|
|
92
|
|
|
249
|
|
|||
Income taxes payable
|
(52
|
)
|
|
26
|
|
|
14
|
|
|||
Pension funding
|
(41
|
)
|
|
(48
|
)
|
|
(48
|
)
|
|||
Retainage payable
|
(2
|
)
|
|
(2
|
)
|
|
(16
|
)
|
|||
Subcontractor advances
|
8
|
|
|
(12
|
)
|
|
(3
|
)
|
|||
Net settlement of derivative contracts
|
(9
|
)
|
|
(44
|
)
|
|
(40
|
)
|
|||
Other assets and liabilities
|
68
|
|
|
17
|
|
|
115
|
|
|||
Total cash flows provided by operating activities
|
61
|
|
|
47
|
|
|
170
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Purchases of property, plant and equipment
|
(11
|
)
|
|
(10
|
)
|
|
(53
|
)
|
|||
Payments for investments in equity method joint ventures
|
(61
|
)
|
|
(19
|
)
|
|
—
|
|
|||
Proceeds from sale of assets or investments
|
2
|
|
|
130
|
|
|
9
|
|
|||
Acquisitions of businesses, net of cash acquired
|
(911
|
)
|
|
—
|
|
|
—
|
|
|||
Total cash flows (used in) provided by investing activities
|
$
|
(981
|
)
|
|
$
|
101
|
|
|
$
|
(44
|
)
|
KBR, Inc.
Consolidated Statements of Cash Flows
(In millions)
|
|||||||||||
|
Years ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
|
|
|
|
|
|
||||||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Payments to reacquire common stock
|
(4
|
)
|
|
(62
|
)
|
|
(106
|
)
|
|||
Acquisition of noncontrolling interest
|
—
|
|
|
(40
|
)
|
|
—
|
|
|||
Investments from noncontrolling interests
|
—
|
|
|
—
|
|
|
10
|
|
|||
Distributions to noncontrolling interests
|
(9
|
)
|
|
(28
|
)
|
|
(61
|
)
|
|||
Payments of dividends to shareholders
|
(46
|
)
|
|
(47
|
)
|
|
(47
|
)
|
|||
Net proceeds from issuance of common stock
|
—
|
|
|
1
|
|
|
4
|
|
|||
Excess tax benefits from share-based compensation
|
1
|
|
|
—
|
|
|
—
|
|
|||
Borrowings on revolving credit agreement
|
700
|
|
|
—
|
|
|
—
|
|
|||
Payments on revolving credit agreement
|
(50
|
)
|
|
—
|
|
|
—
|
|
|||
Payments on short-term and long-term borrowings
|
(9
|
)
|
|
(11
|
)
|
|
(11
|
)
|
|||
Other
|
1
|
|
|
(5
|
)
|
|
1
|
|
|||
Total cash flows provided by (used in) financing activities
|
584
|
|
|
(192
|
)
|
|
(210
|
)
|
|||
Effect of exchange rate changes on cash
|
(11
|
)
|
|
(43
|
)
|
|
(52
|
)
|
|||
Decrease in cash and equivalents
|
(347
|
)
|
|
(87
|
)
|
|
(136
|
)
|
|||
Cash and equivalents at beginning of period
|
883
|
|
|
970
|
|
|
1,106
|
|
|||
Cash and equivalents at end of period
|
$
|
536
|
|
|
$
|
883
|
|
|
$
|
970
|
|
Supplemental disclosure of cash flows information:
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
12
|
|
|
$
|
10
|
|
|
$
|
11
|
|
Cash paid for income taxes (net of refunds)
|
$
|
49
|
|
|
$
|
66
|
|
|
$
|
37
|
|
Noncash financing activities
|
|
|
|
|
|
||||||
Dividends declared
|
$
|
12
|
|
|
$
|
12
|
|
|
$
|
12
|
|
•
|
project revenues, costs and profits on engineering and construction contracts, including recognition of estimated losses on uncompleted contracts
|
•
|
project revenues, award fees, costs and profits on government services contracts
|
•
|
provisions for uncollectible receivables and client claims and recoveries of costs from subcontractors, vendors and others
|
•
|
provisions for income taxes and related valuation allowances and tax uncertainties
|
•
|
recoverability of goodwill
|
•
|
recoverability of other intangibles and long-lived assets and related estimated lives
|
•
|
recoverability of equity method and cost method investments
|
•
|
valuation of pension obligations and pension assets
|
•
|
accruals for estimated liabilities, including litigation accruals
|
•
|
consolidation of VIEs
|
•
|
valuation of share-based compensation
|
•
|
valuation of assets and liabilities acquired in business combinations
|
•
|
recognize on its balance sheet the funded status (measured as the difference between the fair value of plan assets and the benefit obligation) of the pension plan;
|
•
|
recognize, through comprehensive income, certain changes in the funded status of a defined benefit plan in the year in which the changes occur;
|
•
|
measure plan assets and benefit obligations as of the end of the employer’s fiscal year; and
|
•
|
disclose additional information.
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Inventory
|
$
|
5
|
|
|
$
|
5
|
|
Restricted cash
|
2
|
|
|
2
|
|
||
Prepaid expenses
|
56
|
|
|
58
|
|
||
Value-added tax receivable
|
17
|
|
|
9
|
|
||
Advances to subcontractors
|
1
|
|
|
9
|
|
||
Other miscellaneous assets
|
22
|
|
|
26
|
|
||
Total other current assets
|
$
|
103
|
|
|
$
|
109
|
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Reserve for estimated losses on uncompleted contracts (a)
|
$
|
63
|
|
|
$
|
60
|
|
Retainage payable
|
47
|
|
|
49
|
|
||
Income taxes payable
|
55
|
|
|
56
|
|
||
Restructuring reserves
|
30
|
|
|
29
|
|
||
Taxes payable not based on income
|
14
|
|
|
7
|
|
||
Value-added tax payable
|
16
|
|
|
12
|
|
||
Insurance payable
|
14
|
|
|
12
|
|
||
Dividend payable
|
12
|
|
|
12
|
|
||
Other miscellaneous liabilities (b)
|
41
|
|
|
26
|
|
||
Total other current liabilities
|
$
|
292
|
|
|
$
|
263
|
|
|
(a)
|
See Note
2
to our consolidated financial statements for further discussion on significant reserves for estimated losses on uncompleted contracts.
|
(b)
|
Included in "other miscellaneous liabilities" is deferred rent of
$4 million
and
$7 million
as of
December 31, 2016
and
2015
, respectively.
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Revenues:
|
|
|
|
|
|
||||||
Government Services
|
$
|
1,359
|
|
|
$
|
663
|
|
|
$
|
638
|
|
Technology & Consulting
|
347
|
|
|
324
|
|
|
353
|
|
|||
Engineering & Construction
|
2,352
|
|
|
3,454
|
|
|
4,584
|
|
|||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Subtotal
|
4,058
|
|
|
4,441
|
|
|
5,575
|
|
|||
Non-strategic Business
|
210
|
|
|
655
|
|
|
791
|
|
|||
Total
|
$
|
4,268
|
|
|
$
|
5,096
|
|
|
$
|
6,366
|
|
Gross profit (loss):
|
|
|
|
|
|
||||||
Government Services
|
$
|
137
|
|
|
$
|
(3
|
)
|
|
$
|
(32
|
)
|
Technology & Consulting
|
73
|
|
|
77
|
|
|
53
|
|
|||
Engineering & Construction
|
7
|
|
|
224
|
|
|
141
|
|
|||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Subtotal
|
217
|
|
|
298
|
|
|
162
|
|
|||
Non-strategic Business
|
(105
|
)
|
|
27
|
|
|
(227
|
)
|
|||
Total
|
$
|
112
|
|
|
$
|
325
|
|
|
$
|
(65
|
)
|
Equity in earnings of unconsolidated affiliates:
|
|
|
|
|
|
||||||
Government Services
|
$
|
39
|
|
|
$
|
45
|
|
|
$
|
73
|
|
Technology & Consulting
|
—
|
|
|
—
|
|
|
—
|
|
|||
Engineering & Construction
|
52
|
|
|
104
|
|
|
90
|
|
|||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Subtotal
|
91
|
|
|
149
|
|
|
163
|
|
|||
Non-strategic Business
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
91
|
|
|
$
|
149
|
|
|
$
|
163
|
|
Impairment of goodwill (Note 9):
|
|
|
|
|
|
||||||
Government Services
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Technology & Consulting
|
—
|
|
|
—
|
|
|
—
|
|
|||
Engineering & Construction
|
—
|
|
|
—
|
|
|
(293
|
)
|
|||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Subtotal
|
—
|
|
|
—
|
|
|
(293
|
)
|
|||
Non-strategic Business
|
—
|
|
|
—
|
|
|
(153
|
)
|
|||
Total
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(446
|
)
|
Asset impairment and restructuring charges (Note 10):
|
|
|
|
|
|
||||||
Government Services
|
$
|
(1
|
)
|
|
$
|
—
|
|
|
$
|
(5
|
)
|
Technology & Consulting
|
(1
|
)
|
|
(10
|
)
|
|
(2
|
)
|
|||
Engineering & Construction
|
(30
|
)
|
|
(34
|
)
|
|
(24
|
)
|
|||
Other
|
(7
|
)
|
|
(22
|
)
|
|
(149
|
)
|
|||
Subtotal
|
(39
|
)
|
|
(66
|
)
|
|
(180
|
)
|
|||
Non-strategic Business
|
—
|
|
|
(4
|
)
|
|
(34
|
)
|
|||
Total
|
$
|
(39
|
)
|
|
$
|
(70
|
)
|
|
$
|
(214
|
)
|
Segment operating income (loss):
|
|
|
|
|
|
||||||
Government Services
|
$
|
152
|
|
|
$
|
37
|
|
|
$
|
25
|
|
Technology & Consulting
|
66
|
|
|
62
|
|
|
49
|
|
|||
Engineering & Construction
|
4
|
|
|
295
|
|
|
(114
|
)
|
|||
Other
|
(93
|
)
|
|
(140
|
)
|
|
(312
|
)
|
|||
Subtotal
|
129
|
|
|
254
|
|
|
(352
|
)
|
|||
Non-strategic Business
|
(101
|
)
|
|
56
|
|
|
(442
|
)
|
|||
Total
|
$
|
28
|
|
|
$
|
310
|
|
|
$
|
(794
|
)
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Capital expenditures:
|
|
|
|
|
|
||||||
Government Services
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Technology & Consulting
|
—
|
|
|
—
|
|
|
—
|
|
|||
Engineering & Construction
|
5
|
|
|
6
|
|
|
19
|
|
|||
Other
|
4
|
|
|
4
|
|
|
34
|
|
|||
Subtotal
|
11
|
|
|
10
|
|
|
53
|
|
|||
Non-strategic Business
|
—
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
11
|
|
|
$
|
10
|
|
|
$
|
53
|
|
Depreciation and amortization:
|
|
|
|
|
|
||||||
Government Services
|
$
|
16
|
|
|
$
|
6
|
|
|
$
|
8
|
|
Technology & Consulting
|
3
|
|
|
2
|
|
|
2
|
|
|||
Engineering & Construction
|
16
|
|
|
17
|
|
|
23
|
|
|||
Other
|
10
|
|
|
14
|
|
|
33
|
|
|||
Subtotal
|
45
|
|
|
39
|
|
|
66
|
|
|||
Non-strategic Business
|
—
|
|
|
—
|
|
|
6
|
|
|||
Total
|
$
|
45
|
|
|
$
|
39
|
|
|
$
|
72
|
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Total assets:
|
|
|
|
||||
Government Services
|
$
|
1,646
|
|
|
$
|
464
|
|
Technology & Consulting
|
219
|
|
|
198
|
|
||
Engineering & Construction
|
1,600
|
|
|
1,656
|
|
||
Other
|
666
|
|
|
1,060
|
|
||
Subtotal
|
4,131
|
|
|
3,378
|
|
||
Non-strategic Business
|
13
|
|
|
34
|
|
||
Total
|
$
|
4,144
|
|
|
$
|
3,412
|
|
Goodwill (Note 9):
|
|
|
|
||||
Government Services
|
$
|
674
|
|
|
$
|
60
|
|
Technology & Consulting
|
52
|
|
|
31
|
|
||
Engineering & Construction
|
233
|
|
|
233
|
|
||
Other
|
—
|
|
|
—
|
|
||
Subtotal
|
959
|
|
|
324
|
|
||
Non-strategic Business
|
—
|
|
|
—
|
|
||
Total
|
$
|
959
|
|
|
$
|
324
|
|
Equity in and advances to related companies (Note 11):
|
|
|
|
||||
Government Services
|
$
|
37
|
|
|
$
|
26
|
|
Technology & Consulting
|
—
|
|
|
—
|
|
||
Engineering & Construction
|
332
|
|
|
255
|
|
||
Other
|
—
|
|
|
—
|
|
||
Subtotal
|
369
|
|
|
281
|
|
||
Non-strategic Business
|
—
|
|
|
—
|
|
||
Total
|
$
|
369
|
|
|
$
|
281
|
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Revenues:
|
|
|
|
|
|
||||||
United States
|
$
|
2,111
|
|
|
$
|
2,212
|
|
|
$
|
2,324
|
|
Middle East
|
849
|
|
|
786
|
|
|
707
|
|
|||
Europe
|
498
|
|
|
495
|
|
|
624
|
|
|||
Australia
|
376
|
|
|
836
|
|
|
1,380
|
|
|||
Canada
|
145
|
|
|
185
|
|
|
752
|
|
|||
Africa
|
111
|
|
|
164
|
|
|
251
|
|
|||
Other Countries
|
178
|
|
|
418
|
|
|
328
|
|
|||
Total
|
$
|
4,268
|
|
|
$
|
5,096
|
|
|
$
|
6,366
|
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Property, plant & equipment, net:
|
|
|
|
||||
United States
|
$
|
70
|
|
|
$
|
73
|
|
United Kingdom
|
35
|
|
|
48
|
|
||
Other
|
40
|
|
|
48
|
|
||
Total
|
$
|
145
|
|
|
$
|
169
|
|
Dollars in millions
|
|
||
Fair value of total consideration transferred
|
$
|
280
|
|
|
|
||
Recognized amounts of identifiable assets acquired and liabilities assumed:
|
|
||
Trade receivables, net
|
29
|
|
|
CIE
|
93
|
|
|
Prepaids and other current assets
|
5
|
|
|
Total current assets
|
127
|
|
|
Property, plant and equipment, net
|
7
|
|
|
Intangible assets (a):
|
|
||
Customer relationships
|
62
|
|
|
Backlog
|
7
|
|
|
Internally developed software
|
1
|
|
|
Deferred income taxes
|
8
|
|
|
Total assets
|
212
|
|
|
|
|
||
Accounts payable
|
23
|
|
|
BIE
|
5
|
|
|
Other current liabilities
|
35
|
|
|
Total current liabilities
|
63
|
|
|
|
|
||
Goodwill
|
$
|
131
|
|
|
(a)
|
These intangible assets are amortized over their estimated useful lives up to
20 years
.
|
Dollars in millions
|
|
||
Fair value of total consideration transferred
|
$
|
623
|
|
|
|
||
Recognized amounts of identifiable assets acquired and liabilities assumed:
|
|
||
Cash
|
10
|
|
|
Trade receivables, net
|
47
|
|
|
CIE
|
98
|
|
|
Prepaids and other current assets
|
4
|
|
|
Total current assets
|
159
|
|
|
Property, plant and equipment, net
|
10
|
|
|
Intangible assets (a):
|
|
||
Customer relationships
|
82
|
|
|
Trademarks/trade names
|
48
|
|
|
Backlog
|
11
|
|
|
Total assets
|
310
|
|
|
|
|
||
Accounts payable
|
59
|
|
|
Other current liabilities
|
47
|
|
|
Total current liabilities
|
106
|
|
|
Deferred income taxes
|
52
|
|
|
Other liabilities
|
12
|
|
|
Total liabilities
|
170
|
|
|
|
|
||
Goodwill
|
$
|
483
|
|
|
(a)
|
These intangible assets are amortized over their estimated useful lives up to
20 years
with the exception of Trademarks/trade names which have an indefinite life.
|
|
Years ended December 31,
|
||||||
Dollars in millions, except per share data
|
2016
|
|
2015
|
||||
|
(Unaudited)
|
||||||
Revenue
|
$
|
5,129
|
|
|
$
|
6,599
|
|
Net income (loss) attributable to KBR
|
(23
|
)
|
|
248
|
|
||
Diluted earnings per share
|
$
|
(0.16
|
)
|
|
$
|
1.72
|
|
Dollars in millions
|
|
||
Fair value of total consideration transferred
|
$
|
25
|
|
|
|
||
Recognized amounts of identifiable assets acquired and liabilities assumed:
|
|
||
Cash
|
2
|
|
|
Trade receivables, net
|
5
|
|
|
CIE
|
8
|
|
|
Prepaids and other current assets
|
5
|
|
|
Total current assets
|
20
|
|
|
Intangible assets (a):
|
|
||
Developed technology
|
10
|
|
|
Customer relationships
|
7
|
|
|
Trademarks/trade names
|
2
|
|
|
Other assets
|
1
|
|
|
Total assets
|
40
|
|
|
|
|
||
Accounts payable
|
2
|
|
|
BIE
|
15
|
|
|
Other current liabilities
|
7
|
|
|
Total current liabilities
|
24
|
|
|
Deferred income taxes
|
10
|
|
|
Other liabilities
|
5
|
|
|
Total liabilities
|
39
|
|
|
|
|
||
Goodwill
|
$
|
24
|
|
|
(a)
|
These intangible assets are amortized over their estimated useful lives up to
20 years
with the exception of Trademarks/trade names which have an indefinite life.
|
|
December 31, 2016
|
||||||||||
Dollars in millions
|
International (a)
|
|
Domestic (b)
|
|
Total
|
||||||
Operating cash and equivalents
|
$
|
163
|
|
|
$
|
242
|
|
|
$
|
405
|
|
Short-term investments (c)
|
68
|
|
|
7
|
|
|
75
|
|
|||
Cash and equivalents held in joint ventures
|
50
|
|
|
6
|
|
|
56
|
|
|||
Total
|
$
|
281
|
|
|
$
|
255
|
|
|
$
|
536
|
|
|
December 31, 2015
|
||||||||||
Dollars in millions
|
International (a)
|
|
Domestic (b)
|
|
Total
|
||||||
Operating cash and equivalents
|
$
|
177
|
|
|
$
|
253
|
|
|
$
|
430
|
|
Short-term investments (c)
|
293
|
|
|
107
|
|
|
400
|
|
|||
Cash and equivalents held in joint ventures
|
49
|
|
|
4
|
|
|
53
|
|
|||
Total
|
$
|
519
|
|
|
$
|
364
|
|
|
$
|
883
|
|
|
(a)
|
Includes deposits held in non-U.S. operating accounts
|
(b)
|
Includes U.S. dollar and foreign currency deposits held in operating accounts that constitute onshore cash for tax purposes but may reside either in the U.S. or in a foreign country
|
(c)
|
Includes time deposits, money market funds, and other highly liquid short-term investments.
|
|
December 31, 2016
|
||||||||||
Dollars in millions
|
Retainage
|
|
Trade & Other
|
|
Total
|
||||||
Government Services
|
$
|
6
|
|
|
$
|
190
|
|
|
$
|
196
|
|
Technology & Consulting
|
—
|
|
|
52
|
|
|
52
|
|
|||
Engineering & Construction
|
53
|
|
|
276
|
|
|
329
|
|
|||
Other
|
—
|
|
|
3
|
|
|
3
|
|
|||
Subtotal
|
59
|
|
|
521
|
|
|
580
|
|
|||
Non-strategic Business
|
5
|
|
|
7
|
|
|
12
|
|
|||
Total
|
$
|
64
|
|
|
$
|
528
|
|
|
$
|
592
|
|
|
December 31, 2015
|
||||||||||
Dollars in millions
|
Retainage
|
|
Trade & Other
|
|
Total
|
||||||
Government Services
|
$
|
2
|
|
|
$
|
75
|
|
|
$
|
77
|
|
Technology & Consulting
|
—
|
|
|
70
|
|
|
70
|
|
|||
Engineering & Construction
|
51
|
|
|
402
|
|
|
453
|
|
|||
Other
|
—
|
|
|
2
|
|
|
2
|
|
|||
Subtotal
|
53
|
|
|
549
|
|
|
602
|
|
|||
Non-strategic Business
|
9
|
|
|
17
|
|
|
26
|
|
|||
Total
|
$
|
62
|
|
|
$
|
566
|
|
|
$
|
628
|
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Government Services
|
$
|
271
|
|
|
$
|
68
|
|
Technology & Consulting
|
30
|
|
|
42
|
|
||
Engineering & Construction (a)
|
115
|
|
|
114
|
|
||
Subtotal
|
416
|
|
|
224
|
|
||
Non-strategic Business
|
—
|
|
|
—
|
|
||
Total
|
$
|
416
|
|
|
$
|
224
|
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Government Services
|
$
|
76
|
|
|
$
|
69
|
|
Technology & Consulting
|
61
|
|
|
72
|
|
||
Engineering & Construction
|
388
|
|
|
307
|
|
||
Subtotal
|
525
|
|
|
448
|
|
||
Non-strategic Business
|
27
|
|
|
61
|
|
||
Total
|
$
|
552
|
|
|
$
|
509
|
|
Dollars in millions
|
2016
|
|
2015
|
||||
Amounts included in project estimates-at-completion at January 1,
|
$
|
46
|
|
|
$
|
31
|
|
Additions
|
19
|
|
|
71
|
|
||
Approved change orders
|
(37
|
)
|
|
(42
|
)
|
||
Adjustment due to disposition of business
|
—
|
|
|
(14
|
)
|
||
Amounts included in project estimates-at-completion at December 31,
|
$
|
28
|
|
|
$
|
46
|
|
Amounts recorded in revenues on a percentage-of-completion basis at December 31,
|
$
|
28
|
|
|
$
|
41
|
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Government Services
|
$
|
131
|
|
|
$
|
126
|
|
Engineering & Construction
|
—
|
|
|
400
|
|
||
Total
|
$
|
131
|
|
|
$
|
526
|
|
|
Estimated
Useful
Lives in Years
|
|
December 31,
|
||||||
Dollars in millions
|
|
2016
|
|
2015
|
|||||
Land
|
N/A
|
|
$
|
7
|
|
|
$
|
7
|
|
Buildings and property improvements
|
5 - 44
|
|
124
|
|
|
140
|
|
||
Equipment and other
|
3 - 25
|
|
338
|
|
|
374
|
|
||
Total
|
|
|
469
|
|
|
521
|
|
||
Less accumulated depreciation
|
|
|
(324
|
)
|
|
(352
|
)
|
||
Net property, plant and equipment
|
|
|
$
|
145
|
|
|
$
|
169
|
|
Dollars in millions
|
Government Services
|
|
Technology & Consulting
|
|
Engineering & Construction
|
|
Other
|
|
Subtotal
|
|
Non-strategic Business
|
|
Total
|
||||||||||||||
Balance as of January 1, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross goodwill
|
$
|
60
|
|
|
$
|
31
|
|
|
$
|
526
|
|
|
$
|
—
|
|
|
$
|
617
|
|
|
$
|
331
|
|
|
$
|
948
|
|
Accumulated impairment losses
|
—
|
|
|
—
|
|
|
(293
|
)
|
|
—
|
|
|
(293
|
)
|
|
(331
|
)
|
|
(624
|
)
|
|||||||
Net goodwill as of January 1, 2015
|
$
|
60
|
|
|
$
|
31
|
|
|
$
|
233
|
|
|
$
|
—
|
|
|
$
|
324
|
|
|
$
|
—
|
|
|
$
|
324
|
|
Impairment loss
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Net foreign exchange difference
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balances as of December 31, 2015:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross goodwill
|
$
|
60
|
|
|
$
|
31
|
|
|
$
|
526
|
|
|
$
|
—
|
|
|
$
|
617
|
|
|
$
|
331
|
|
|
$
|
948
|
|
Accumulated impairment losses
|
—
|
|
|
—
|
|
|
(293
|
)
|
|
—
|
|
|
(293
|
)
|
|
(331
|
)
|
|
(624
|
)
|
|||||||
Net goodwill as of December 31, 2015
|
$
|
60
|
|
|
$
|
31
|
|
|
$
|
233
|
|
|
$
|
—
|
|
|
$
|
324
|
|
|
$
|
—
|
|
|
$
|
324
|
|
Goodwill acquired during the period
|
$
|
614
|
|
|
$
|
24
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
638
|
|
|
$
|
—
|
|
|
$
|
638
|
|
Impairment loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net foreign exchange difference
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
|
—
|
|
|
(3
|
)
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Balance as of December 31, 2016:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Gross goodwill
|
$
|
674
|
|
|
$
|
52
|
|
|
$
|
526
|
|
|
$
|
—
|
|
|
$
|
1,252
|
|
|
$
|
331
|
|
|
$
|
1,583
|
|
Accumulated impairment losses
|
—
|
|
|
—
|
|
|
(293
|
)
|
|
—
|
|
|
(293
|
)
|
|
(331
|
)
|
|
(624
|
)
|
|||||||
Net goodwill as of December 31, 2016
|
$
|
674
|
|
|
$
|
52
|
|
|
$
|
233
|
|
|
$
|
—
|
|
|
$
|
959
|
|
|
$
|
—
|
|
|
$
|
959
|
|
Dollars in millions
|
December 31, 2016
|
||||||||||||
|
Weighted Average Remaining Useful Lives
|
|
Intangible Assets, Gross
|
|
Accumulated Amortization
|
|
Intangible Assets, Net
|
||||||
Trademarks/trade names
|
Indefinite
|
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
60
|
|
Customer relationships
|
14
|
|
199
|
|
|
(47
|
)
|
|
152
|
|
|||
Developed technologies
|
10
|
|
46
|
|
|
(33
|
)
|
|
13
|
|
|||
Other
|
1
|
|
43
|
|
|
(20
|
)
|
|
23
|
|
|||
Total intangible assets
|
|
|
$
|
348
|
|
|
$
|
(100
|
)
|
|
$
|
248
|
|
|
|
|
|
|
|
|
|
||||||
|
December 31, 2015
|
||||||||||||
|
Weighted Average Remaining Useful Lives
|
|
Intangible Assets, Gross
|
|
Accumulated Amortization
|
|
Intangible Assets, Net
|
||||||
Trademarks/trade names
|
Indefinite
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
11
|
|
Customer relationships
|
3
|
|
48
|
|
|
(40
|
)
|
|
8
|
|
|||
Developed technologies
|
11
|
|
35
|
|
|
(33
|
)
|
|
2
|
|
|||
Other
|
9
|
|
32
|
|
|
(18
|
)
|
|
14
|
|
|||
Total intangible assets
|
|
|
$
|
126
|
|
|
$
|
(91
|
)
|
|
$
|
35
|
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Intangibles amortization expense
|
$
|
14
|
|
|
$
|
4
|
|
|
$
|
11
|
|
Dollars in millions
|
Expected future
intangibles
amortization expense
|
||
2017
|
$
|
22
|
|
2018
|
$
|
14
|
|
2019
|
$
|
13
|
|
2020
|
$
|
11
|
|
2021
|
$
|
9
|
|
Beyond 2021
|
$
|
119
|
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Asset impairment:
|
|
|
|
|
|
||||||
Government Services
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Technology & Consulting
|
—
|
|
|
—
|
|
|
—
|
|
|||
Engineering & Construction
|
10
|
|
|
8
|
|
|
1
|
|
|||
Other
|
7
|
|
|
21
|
|
|
139
|
|
|||
Subtotal
|
17
|
|
|
29
|
|
|
140
|
|
|||
Non-strategic Business
|
—
|
|
|
2
|
|
|
31
|
|
|||
Total
|
$
|
17
|
|
|
$
|
31
|
|
|
$
|
171
|
|
Restructuring charges:
|
|
|
|
|
|
||||||
Government Services
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
5
|
|
Technology & Consulting
|
1
|
|
|
10
|
|
|
2
|
|
|||
Engineering & Construction
|
20
|
|
|
26
|
|
|
23
|
|
|||
Other
|
—
|
|
|
1
|
|
|
10
|
|
|||
Subtotal
|
22
|
|
|
37
|
|
|
40
|
|
|||
Non-strategic Business
|
—
|
|
|
2
|
|
|
3
|
|
|||
Total
|
$
|
22
|
|
|
$
|
39
|
|
|
$
|
43
|
|
Asset impairment and restructuring charges:
|
|
|
|
|
|
||||||
Total
|
$
|
39
|
|
|
$
|
70
|
|
|
$
|
214
|
|
Dollars in millions
|
Severance Accrual
|
||
Balance at December 31, 2014
|
$
|
21
|
|
Charges
|
27
|
|
|
Payments
|
(29
|
)
|
|
Balance at December 31, 2015
|
$
|
19
|
|
Charges
|
18
|
|
|
Payments
|
(29
|
)
|
|
Balance at December 31, 2016
|
$
|
8
|
|
Dollars in millions
|
2016
|
|
2015
|
||||
Balance at January 1,
|
$
|
281
|
|
|
$
|
151
|
|
Equity in earnings of unconsolidated affiliates
|
91
|
|
|
149
|
|
||
Distributions of earnings of unconsolidated affiliates (a)
|
(56
|
)
|
|
(92
|
)
|
||
Advances (receipts)
|
1
|
|
|
(10
|
)
|
||
Investments (b)
|
61
|
|
|
80
|
|
||
Foreign currency translation adjustments
|
(8
|
)
|
|
(9
|
)
|
||
Other
|
(8
|
)
|
|
1
|
|
||
Balance before reclassification
|
362
|
|
|
270
|
|
||
Reclassification of excess distributions (a)
|
12
|
|
|
16
|
|
||
Recognition of excess distributions (a)
|
(5
|
)
|
|
(5
|
)
|
||
Balance at December 31,
|
$
|
369
|
|
|
$
|
281
|
|
|
(a)
|
We received cash dividends in excess of the carrying value of one of our investments. We have no obligation to return any portion of the cash dividends received. We recorded the excess dividend amount as "deferred income from unconsolidated affiliates" on our consolidated balance sheets and recognize these dividends as earnings are generated by the investment.
|
(b)
|
In 2016, investments included a
$56 million
investment in the Brown & Root Industrial Services joint venture and a
$5 million
investment in EPIC Piping LLC ("EPIC") joint venture. In 2015, investments included a
$58 million
investment in the Brown & Root Industrial Services joint venture, a
$24 million
investment in EPIC, and the disposition of a joint venture included in the sale of the Building Group.
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Current assets
|
$
|
2,655
|
|
|
$
|
2,331
|
|
Noncurrent assets
|
3,003
|
|
|
3,435
|
|
||
Total assets
|
$
|
5,658
|
|
|
$
|
5,766
|
|
|
|
|
|
||||
Current liabilities
|
$
|
1,657
|
|
|
$
|
1,501
|
|
Noncurrent liabilities
|
3,148
|
|
|
3,742
|
|
||
Total liabilities
|
$
|
4,805
|
|
|
$
|
5,243
|
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Revenues
|
$
|
5,877
|
|
|
$
|
5,245
|
|
|
$
|
6,439
|
|
Operating income
|
$
|
365
|
|
|
$
|
635
|
|
|
$
|
659
|
|
Net income
|
$
|
192
|
|
|
$
|
476
|
|
|
$
|
419
|
|
|
December 31, 2016
|
||||||||||
Dollars in millions
|
Total Assets
|
|
Total Liabilities
|
|
Maximum
Exposure to
Loss
|
||||||
Affinity project
|
$
|
12
|
|
|
$
|
3
|
|
|
$
|
12
|
|
Aspire Defence project
|
$
|
14
|
|
|
$
|
107
|
|
|
$
|
14
|
|
Ichthys LNG project
|
$
|
124
|
|
|
$
|
33
|
|
|
$
|
124
|
|
U.K. Road projects
|
$
|
30
|
|
|
$
|
9
|
|
|
$
|
30
|
|
EBIC Ammonia plant (65% interest)
|
$
|
34
|
|
|
$
|
2
|
|
|
$
|
22
|
|
Dollars in millions
|
December 31, 2015
|
||||||||||
Total Assets
|
|
Total Liabilities
|
|
Maximum
Exposure to
Loss
|
|||||||
Aspire Defence project
|
$
|
17
|
|
|
$
|
121
|
|
|
$
|
17
|
|
Ichthys LNG project
|
$
|
87
|
|
|
$
|
63
|
|
|
$
|
87
|
|
U.K. Road projects
|
$
|
34
|
|
|
$
|
11
|
|
|
$
|
34
|
|
EBIC Ammonia plant (65% interest)
|
$
|
36
|
|
|
$
|
2
|
|
|
$
|
22
|
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Accounts receivable (a)
|
$
|
22
|
|
|
$
|
7
|
|
Costs and estimated earnings in excess of billings on uncompleted contracts (b)
|
$
|
1
|
|
|
$
|
5
|
|
Billings in excess of costs and estimated earnings on uncompleted contracts (b)
|
$
|
41
|
|
|
$
|
55
|
|
Accounts payable (c)
|
$
|
—
|
|
|
$
|
9
|
|
|
(a)
|
Includes a
$11 million
net receivable from the Brown & Root Industrial Services joint venture at
December 31, 2016
.
|
(b)
|
Reflects CIE and BIE primarily related to joint ventures within our E&C business segment as discussed above.
|
(c)
|
Reflects a
$9 million
net payable to the Brown & Root Industrial Services joint venture at
December 31, 2015
.
|
Dollars in millions
|
December 31, 2016
|
||||||
Total Assets
|
|
Total Liabilities
|
|||||
Gorgon LNG project
|
$
|
28
|
|
|
$
|
60
|
|
Escravos Gas-to-Liquids project
|
$
|
11
|
|
|
$
|
22
|
|
Fasttrax Limited project
|
$
|
56
|
|
|
$
|
50
|
|
Dollars in millions
|
December 31, 2015
|
||||||
Total Assets
|
|
Total Liabilities
|
|||||
Gorgon LNG project
|
$
|
117
|
|
|
$
|
145
|
|
Escravos Gas-to-Liquids project
|
$
|
16
|
|
|
$
|
33
|
|
Fasttrax Limited project
|
$
|
74
|
|
|
$
|
70
|
|
|
United States
|
|
Int’l
|
|
United States
|
|
Int’l
|
||||||||
Dollars in millions
|
2016
|
|
2015
|
||||||||||||
Change in projected benefit obligations:
|
|
|
|
|
|
|
|
||||||||
Projected benefit obligations at beginning of period
|
$
|
75
|
|
|
$
|
1,849
|
|
|
$
|
87
|
|
|
$
|
2,138
|
|
Acquisitions
|
12
|
|
|
3
|
|
|
—
|
|
|
—
|
|
||||
Service cost
|
—
|
|
|
1
|
|
|
—
|
|
|
2
|
|
||||
Interest cost
|
3
|
|
|
63
|
|
|
2
|
|
|
76
|
|
||||
Foreign currency exchange rate changes
|
—
|
|
|
(304
|
)
|
|
(3
|
)
|
|
(174
|
)
|
||||
Actuarial (gain) loss
|
—
|
|
|
448
|
|
|
—
|
|
|
(112
|
)
|
||||
Other
|
—
|
|
|
(1
|
)
|
|
—
|
|
|
—
|
|
||||
Benefits paid
|
(15
|
)
|
|
(89
|
)
|
|
(11
|
)
|
|
(81
|
)
|
||||
Projected benefit obligations at end of period
|
$
|
75
|
|
|
$
|
1,970
|
|
|
$
|
75
|
|
|
$
|
1,849
|
|
Change in plan assets:
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets at beginning of period
|
$
|
59
|
|
|
$
|
1,532
|
|
|
$
|
66
|
|
|
$
|
1,652
|
|
Acquisitions
|
8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Actual return on plan assets
|
3
|
|
|
235
|
|
|
(1
|
)
|
|
8
|
|
||||
Employer contributions
|
1
|
|
|
40
|
|
|
5
|
|
|
43
|
|
||||
Foreign currency exchange rate changes
|
—
|
|
|
(255
|
)
|
|
—
|
|
|
(90
|
)
|
||||
Benefits paid
|
(15
|
)
|
|
(89
|
)
|
|
(11
|
)
|
|
(81
|
)
|
||||
Other
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Fair value of plan assets at end of period
|
$
|
56
|
|
|
$
|
1,463
|
|
|
$
|
59
|
|
|
$
|
1,532
|
|
Funded status
|
$
|
(19
|
)
|
|
$
|
(507
|
)
|
|
$
|
(16
|
)
|
|
$
|
(317
|
)
|
|
United States
|
|
Int’l
|
|
United States
|
|
Int’l
|
||||||||
Dollars in millions
|
2016
|
|
2015
|
||||||||||||
Amounts recognized on the consolidated balance sheets
|
|
|
|
|
|
|
|
||||||||
Pension obligations
|
$
|
19
|
|
|
$
|
507
|
|
|
$
|
16
|
|
|
$
|
317
|
|
|
United States
|
|
Int’l
|
|
United States
|
|
Int’l
|
|
United States
|
|
Int’l
|
||||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||||||||||||||
Components of net periodic benefit cost
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Service cost
|
$
|
—
|
|
|
$
|
1
|
|
|
$
|
—
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
2
|
|
Interest cost
|
3
|
|
|
63
|
|
|
2
|
|
|
76
|
|
|
3
|
|
|
90
|
|
||||||
Expected return on plan assets
|
(3
|
)
|
|
(87
|
)
|
|
(3
|
)
|
|
(97
|
)
|
|
(4
|
)
|
|
(102
|
)
|
||||||
Settlements/curtailments
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1
|
|
|
—
|
|
||||||
Recognized actuarial loss
|
1
|
|
|
28
|
|
|
5
|
|
|
43
|
|
|
3
|
|
|
39
|
|
||||||
Net periodic benefit cost
|
$
|
2
|
|
|
$
|
5
|
|
|
$
|
4
|
|
|
$
|
24
|
|
|
$
|
3
|
|
|
$
|
29
|
|
|
United States
|
|
Int’l
|
|
United States
|
|
Int’l
|
||||||||
Dollars in millions
|
2016
|
|
2015
|
||||||||||||
Unrecognized actuarial loss, net of tax of $10 and $244, and $11 and $198, respectively
|
$
|
24
|
|
|
$
|
761
|
|
|
$
|
25
|
|
|
$
|
535
|
|
Total in accumulated other comprehensive loss
|
$
|
24
|
|
|
$
|
761
|
|
|
$
|
25
|
|
|
$
|
535
|
|
Dollars in millions
|
United States
|
|
Int’l
|
||||
Actuarial loss
|
$
|
1
|
|
|
$
|
24
|
|
Total
|
$
|
1
|
|
|
$
|
24
|
|
Weighted-average assumptions used to determine
net periodic benefit cost
|
|
||||||||||||||||
|
United States
|
|
Int'l
|
|
United States
|
|
Int'l
|
|
United States
|
|
Int'l
|
||||||
|
2016
|
|
2015
|
|
2014
|
||||||||||||
Discount rate
|
3.42
|
%
|
|
3.75
|
%
|
|
2.89
|
%
|
|
3.65
|
%
|
|
3.38
|
%
|
|
4.45
|
%
|
Expected return on plan assets
|
5.00
|
%
|
|
6.10
|
%
|
|
4.81
|
%
|
|
6.25
|
%
|
|
5.28
|
%
|
|
6.45
|
%
|
Asset Allocation
|
2017 Targeted
|
||||
|
United States
|
|
Int'l
|
||
Equity funds and securities
|
53
|
%
|
|
20
|
%
|
Fixed income funds and securities
|
46
|
%
|
|
38
|
%
|
Hedge funds
|
—
|
%
|
|
21
|
%
|
Real estate funds
|
1
|
%
|
|
5
|
%
|
Other
|
—
|
%
|
|
16
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
International Plans
|
2017 Targeted
|
|
2016 Targeted
|
||||||||
|
Percentage Range
|
|
Percentage Range
|
||||||||
|
Minimum
|
|
Maximum
|
|
Minimum
|
|
Maximum
|
||||
Equity funds and securities
|
—
|
%
|
|
60
|
%
|
|
—
|
%
|
|
60
|
%
|
Fixed income funds and securities
|
—
|
%
|
|
100
|
%
|
|
—
|
%
|
|
100
|
%
|
Hedge funds
|
—
|
%
|
|
35
|
%
|
|
—
|
%
|
|
35
|
%
|
Real estate funds
|
—
|
%
|
|
10
|
%
|
|
—
|
%
|
|
10
|
%
|
Other
|
—
|
%
|
|
20
|
%
|
|
—
|
%
|
|
20
|
%
|
Domestic Plans
|
2017 Targeted
|
|
2016 Targeted
|
||||||||
|
Percentage Range
|
|
Percentage Range
|
||||||||
|
Minimum
|
|
Maximum
|
|
Minimum
|
|
Maximum
|
||||
Cash and cash equivalents
|
—
|
%
|
|
—
|
%
|
|
19
|
%
|
|
19
|
%
|
Equity funds and securities
|
52
|
%
|
|
55
|
%
|
|
49
|
%
|
|
49
|
%
|
Fixed income funds and securities
|
44
|
%
|
|
47
|
%
|
|
32
|
%
|
|
32
|
%
|
Real estate funds
|
1
|
%
|
|
1
|
%
|
|
—
|
%
|
|
—
|
%
|
|
Fair Value Measurements at Reporting Date
|
||||||||||||||
Dollars in millions
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Asset Category at December 31, 2016
|
|
|
|
|
|
|
|
||||||||
United States plan assets
|
|
|
|
|
|
|
|
||||||||
Investments measured at net asset value
|
$
|
56
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total United States plan assets
|
$
|
56
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
International plan assets
|
|
|
|
|
|
|
|
||||||||
Equities
|
$
|
76
|
|
|
$
|
60
|
|
|
$
|
—
|
|
|
$
|
16
|
|
Fixed income
|
12
|
|
|
—
|
|
|
—
|
|
|
12
|
|
||||
Real estate
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
||||
Cash and cash equivalents
|
8
|
|
|
8
|
|
|
—
|
|
|
—
|
|
||||
Other
|
50
|
|
|
—
|
|
|
—
|
|
|
50
|
|
||||
Investments measured at net asset value
|
1,313
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total international plan assets
|
$
|
1,463
|
|
|
$
|
68
|
|
|
$
|
—
|
|
|
$
|
82
|
|
Total plan assets at December 31, 2016
|
$
|
1,519
|
|
|
$
|
68
|
|
|
$
|
—
|
|
|
$
|
82
|
|
|
Fair Value Measurements at Reporting Date
|
||||||||||||||
Dollars in millions
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
Asset Category at December 31, 2015
|
|
|
|
|
|
|
|
||||||||
United States plan assets
|
|
|
|
|
|
|
|
||||||||
Investments measured at net asset value
|
$
|
59
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Total United States plan assets
|
$
|
59
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
International plan assets
|
|
|
|
|
|
|
|
||||||||
Equities
|
$
|
66
|
|
|
$
|
54
|
|
|
$
|
—
|
|
|
$
|
12
|
|
Fixed income
|
14
|
|
|
—
|
|
|
—
|
|
|
14
|
|
||||
Real estate
|
6
|
|
|
—
|
|
|
—
|
|
|
6
|
|
||||
Cash and cash equivalents
|
10
|
|
|
10
|
|
|
—
|
|
|
—
|
|
||||
Other
|
13
|
|
|
—
|
|
|
—
|
|
|
13
|
|
||||
Investments measured at net asset value
|
1,423
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Total international plan assets
|
$
|
1,532
|
|
|
$
|
64
|
|
|
$
|
—
|
|
|
$
|
45
|
|
Total plan assets at December 31, 2015
|
$
|
1,591
|
|
|
$
|
64
|
|
|
$
|
—
|
|
|
$
|
45
|
|
Dollars in millions
|
Total
|
|
Equities
|
|
Fixed Income
|
|
Real Estate
|
|
Other
|
||||||||||
International plan assets
|
|
|
|
|
|
|
|
|
|
||||||||||
Balance as of December 31, 2014
|
$
|
42
|
|
|
$
|
6
|
|
|
$
|
11
|
|
|
$
|
12
|
|
|
$
|
13
|
|
Return on assets held at end of year
|
2
|
|
|
1
|
|
|
—
|
|
|
(2
|
)
|
|
3
|
|
|||||
Return on assets sold during the year
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|||||
Purchases, sales and settlements
|
(1
|
)
|
|
5
|
|
|
4
|
|
|
(8
|
)
|
|
(2
|
)
|
|||||
Foreign exchange impact
|
(3
|
)
|
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|
(1
|
)
|
|||||
Balance as of December 31, 2015
|
$
|
45
|
|
|
$
|
12
|
|
|
$
|
14
|
|
|
$
|
6
|
|
|
$
|
13
|
|
Return on assets held at end of year
|
14
|
|
|
1
|
|
|
1
|
|
|
1
|
|
|
11
|
|
|||||
Return on assets sold during the year
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Purchases, sales and settlements, net
|
32
|
|
|
5
|
|
|
(1
|
)
|
|
(3
|
)
|
|
31
|
|
|||||
Foreign exchange impact
|
(9
|
)
|
|
(2
|
)
|
|
(2
|
)
|
|
—
|
|
|
(5
|
)
|
|||||
Balance as of December 31, 2016
|
$
|
82
|
|
|
$
|
16
|
|
|
$
|
12
|
|
|
$
|
4
|
|
|
$
|
50
|
|
|
Pension Benefits
|
||||||
Dollars in millions
|
United States
|
|
Int’l
|
||||
2017
|
$
|
5
|
|
|
$
|
48
|
|
2018
|
$
|
5
|
|
|
$
|
50
|
|
2019
|
$
|
5
|
|
|
$
|
51
|
|
2020
|
$
|
5
|
|
|
$
|
52
|
|
2021
|
$
|
5
|
|
|
$
|
53
|
|
Years 2022 – 2026
|
$
|
25
|
|
|
$
|
287
|
|
|
December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Deferred compensation plans obligations
|
$
|
70
|
|
|
$
|
70
|
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
United States
|
$
|
(250
|
)
|
|
$
|
(35
|
)
|
|
$
|
(1,051
|
)
|
Foreign:
|
|
|
|
|
|
||||||
United Kingdom
|
55
|
|
|
105
|
|
|
130
|
|
|||
Australia
|
38
|
|
|
32
|
|
|
180
|
|
|||
Canada
|
(8
|
)
|
|
87
|
|
|
(101
|
)
|
|||
Middle East
|
66
|
|
|
35
|
|
|
(12
|
)
|
|||
Africa
|
76
|
|
|
34
|
|
|
28
|
|
|||
Other
|
56
|
|
|
54
|
|
|
49
|
|
|||
Subtotal
|
283
|
|
|
347
|
|
|
274
|
|
|||
Total
|
$
|
33
|
|
|
$
|
312
|
|
|
$
|
(777
|
)
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Provision for income taxes
|
$
|
(84
|
)
|
|
$
|
(86
|
)
|
|
$
|
(421
|
)
|
Shareholders' equity, foreign currency translation adjustment
|
(3
|
)
|
|
(3
|
)
|
|
4
|
|
|||
Shareholders' equity, pension and post-retirement benefits
|
45
|
|
|
(22
|
)
|
|
10
|
|
|||
Total income taxes
|
$
|
(42
|
)
|
|
$
|
(111
|
)
|
|
$
|
(407
|
)
|
Dollars in millions
|
Current
|
|
Deferred
|
|
Total
|
||||||
Balance as of December 31, 2016
|
|
|
|
|
|
||||||
Federal
|
$
|
(5
|
)
|
|
$
|
9
|
|
|
$
|
4
|
|
Foreign
|
(61
|
)
|
|
(26
|
)
|
|
(87
|
)
|
|||
State and other
|
—
|
|
|
(1
|
)
|
|
(1
|
)
|
|||
Provision for income taxes
|
$
|
(66
|
)
|
|
$
|
(18
|
)
|
|
$
|
(84
|
)
|
|
|
|
|
|
|
||||||
Balance as of December 31, 2015
|
|
|
|
|
|
||||||
Federal
|
$
|
(17
|
)
|
|
$
|
8
|
|
|
$
|
(9
|
)
|
Foreign
|
(55
|
)
|
|
(22
|
)
|
|
(77
|
)
|
|||
State and other
|
—
|
|
|
—
|
|
|
—
|
|
|||
Provision for income taxes
|
$
|
(72
|
)
|
|
$
|
(14
|
)
|
|
$
|
(86
|
)
|
|
|
|
|
|
|
||||||
Balance as of December 31, 2014
|
|
|
|
|
|
||||||
Federal
|
$
|
41
|
|
|
$
|
(333
|
)
|
|
$
|
(292
|
)
|
Foreign
|
(110
|
)
|
|
(11
|
)
|
|
(121
|
)
|
|||
State and other
|
1
|
|
|
(9
|
)
|
|
(8
|
)
|
|||
Provision for income taxes
|
$
|
(68
|
)
|
|
$
|
(353
|
)
|
|
$
|
(421
|
)
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
United Kingdom
|
$
|
(6
|
)
|
|
$
|
(15
|
)
|
|
$
|
(22
|
)
|
Australia
|
—
|
|
|
16
|
|
|
(24
|
)
|
|||
Canada
|
1
|
|
|
3
|
|
|
6
|
|
|||
Middle East
|
(24
|
)
|
|
(8
|
)
|
|
(5
|
)
|
|||
Africa
|
(22
|
)
|
|
(10
|
)
|
|
(24
|
)
|
|||
Other
|
(36
|
)
|
|
(63
|
)
|
|
(52
|
)
|
|||
Foreign provision for income taxes
|
$
|
(87
|
)
|
|
$
|
(77
|
)
|
|
$
|
(121
|
)
|
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Expected deferred benefit
|
$
|
35
|
|
|
$
|
14
|
|
|
$
|
254
|
|
Tax reserves and allowances on current year activity
|
(1
|
)
|
|
(20
|
)
|
|
(210
|
)
|
|||
Tax reserves and allowances on beginning of year deferred balances
|
—
|
|
|
—
|
|
|
(320
|
)
|
|||
Unremitted foreign earnings
|
(51
|
)
|
|
—
|
|
|
(77
|
)
|
|||
U.K. statutory rate change
|
(1
|
)
|
|
(8
|
)
|
|
—
|
|
|||
Total deferred provision for income taxes
|
$
|
(18
|
)
|
|
$
|
(14
|
)
|
|
$
|
(353
|
)
|
|
Years ended December 31,
|
|||||||
|
2016
|
|
2015
|
|
2014
|
|||
U.S. statutory federal rate, expected (benefit) provision
|
35
|
%
|
|
35
|
%
|
|
(35
|
)%
|
Increase (reduction) in tax rate from:
|
|
|
|
|
|
|||
Rate differentials on foreign earnings
|
(28
|
)
|
|
(10
|
)
|
|
(5
|
)
|
Noncontrolling interests and equity earnings
|
(28
|
)
|
|
(8
|
)
|
|
(4
|
)
|
State and local income taxes, net of federal benefit
|
—
|
|
|
2
|
|
|
(2
|
)
|
Other permanent differences, net
|
54
|
|
|
—
|
|
|
2
|
|
Contingent liability accrual
|
41
|
|
|
(1
|
)
|
|
9
|
|
U.S. taxes on foreign unremitted earnings
|
174
|
|
|
1
|
|
|
11
|
|
Non-deductible goodwill impairment
|
—
|
|
|
—
|
|
|
20
|
|
Change in valuation allowance
|
3
|
|
|
6
|
|
|
58
|
|
U.K. statutory rate change
|
4
|
|
|
3
|
|
|
—
|
|
Effective tax rate on income from operations
|
255
|
%
|
|
28
|
%
|
|
54
|
%
|
|
Years ended December 31,
|
||||||
Dollars in millions
|
2016
|
|
2015
|
||||
Deferred tax assets:
|
|
|
|
||||
Employee compensation and benefits
|
$
|
166
|
|
|
$
|
140
|
|
Foreign tax credit carryforwards
|
356
|
|
|
282
|
|
||
Accrued foreign tax credit carryforwards
|
93
|
|
|
97
|
|
||
Loss carryforwards
|
69
|
|
|
65
|
|
||
Insurance accruals
|
15
|
|
|
15
|
|
||
Allowance for bad debt
|
9
|
|
|
10
|
|
||
Accrued liabilities
|
49
|
|
|
45
|
|
||
Total gross deferred tax assets
|
757
|
|
|
654
|
|
||
Valuation allowances
|
(542
|
)
|
|
(542
|
)
|
||
Net deferred tax assets
|
215
|
|
|
112
|
|
||
Deferred tax liabilities:
|
|
|
|
||||
Construction contract accounting
|
(34
|
)
|
|
(12
|
)
|
||
Intangibles
|
(29
|
)
|
|
(25
|
)
|
||
Indefinite-lived intangibles
|
(39
|
)
|
|
—
|
|
||
Depreciation and amortization
|
2
|
|
|
(2
|
)
|
||
Unremitted foreign earnings
|
(63
|
)
|
|
(39
|
)
|
||
Other
|
(82
|
)
|
|
(29
|
)
|
||
Total gross deferred tax liabilities
|
(245
|
)
|
|
(107
|
)
|
||
Deferred income tax (liabilities) assets, net
|
$
|
(30
|
)
|
|
$
|
5
|
|
Dollars in millions
|
Net Gross Deferred Asset (Liability)
|
|
Valuation Allowance
|
|
Deferred Asset (Liability), net
|
||||||
United States
|
$
|
459
|
|
|
$
|
(506
|
)
|
|
$
|
(47
|
)
|
United Kingdom
|
104
|
|
|
—
|
|
|
104
|
|
|||
Australia
|
1
|
|
|
(1
|
)
|
|
—
|
|
|||
Canada
|
22
|
|
|
(16
|
)
|
|
6
|
|
|||
Mexico
|
(92
|
)
|
|
—
|
|
|
(92
|
)
|
|||
Other
|
18
|
|
|
(19
|
)
|
|
(1
|
)
|
|||
Total
|
$
|
512
|
|
|
$
|
(542
|
)
|
|
$
|
(30
|
)
|
|
|
||||
Dollars in millions
|
December 31, 2016
|
|
Expiration
|
||
Foreign tax credit carryforwards
|
$
|
485
|
|
|
2019-2026
|
Foreign net operating loss carryforwards
|
$
|
128
|
|
|
2017-2037
|
Foreign net operating loss carryforwards
|
$
|
32
|
|
|
Indefinite
|
State net operating loss carryforwards
|
$
|
598
|
|
|
Various
|
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Balance at January 1,
|
$
|
257
|
|
|
$
|
228
|
|
|
$
|
68
|
|
Increases related to current year tax positions
|
2
|
|
|
18
|
|
|
13
|
|
|||
Increases related to tax positions from acquisitions
|
14
|
|
|
—
|
|
|
—
|
|
|||
Increases related to prior year tax positions
|
10
|
|
|
35
|
|
|
168
|
|
|||
Decreases related to prior year tax positions
|
(4
|
)
|
|
(3
|
)
|
|
(13
|
)
|
|||
Settlements
|
(10
|
)
|
|
(2
|
)
|
|
(1
|
)
|
|||
Lapse of statute of limitations
|
(6
|
)
|
|
(16
|
)
|
|
(5
|
)
|
|||
Other, primarily due to exchange rate fluctuations affecting non-U.S. tax positions
|
(2
|
)
|
|
(3
|
)
|
|
(2
|
)
|
|||
Balance at December 31,
|
$
|
261
|
|
|
$
|
257
|
|
|
$
|
228
|
|
Dollars in millions
|
Future rental
payments (a)
|
||
2017
|
$
|
97
|
|
2018
|
$
|
85
|
|
2019
|
$
|
75
|
|
2020
|
$
|
66
|
|
2021
|
$
|
61
|
|
Beyond 2021
|
$
|
324
|
|
|
(a)
|
Amounts presented are net of subleases.
|
Dollars in millions
|
Total
|
|
PIC
|
|
Retained
Earnings
|
|
Treasury
Stock
|
|
AOCL
|
|
NCI
|
||||||||||||
Balance at December 31, 2013
|
$
|
2,439
|
|
|
$
|
2,065
|
|
|
$
|
1,748
|
|
|
$
|
(610
|
)
|
|
$
|
(740
|
)
|
|
$
|
(24
|
)
|
Share-based compensation
|
22
|
|
|
22
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common stock issued upon exercise of stock options
|
4
|
|
|
4
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Dividends declared to shareholders
|
(47
|
)
|
|
—
|
|
|
(47
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchases of common stock
|
(106
|
)
|
|
—
|
|
|
—
|
|
|
(106
|
)
|
|
—
|
|
|
—
|
|
||||||
Issuance of ESPP shares
|
4
|
|
|
—
|
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||||
Investments by noncontrolling interests
|
10
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
10
|
|
||||||
Distributions to noncontrolling interests
|
(61
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(61
|
)
|
||||||
Other noncontrolling interests activity
|
2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2
|
|
||||||
Net income (loss)
|
(1,198
|
)
|
|
—
|
|
|
(1,262
|
)
|
|
—
|
|
|
—
|
|
|
64
|
|
||||||
Other comprehensive income (loss), net of tax
|
(134
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(136
|
)
|
|
2
|
|
||||||
Balance at December 31, 2014
|
$
|
935
|
|
|
$
|
2,091
|
|
|
$
|
439
|
|
|
$
|
(712
|
)
|
|
$
|
(876
|
)
|
|
$
|
(7
|
)
|
Acquisition of noncontrolling interest
|
(40
|
)
|
|
(40
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Share-based compensation
|
18
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Common stock issued upon exercise of stock options
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Dividends declared to shareholders
|
(47
|
)
|
|
—
|
|
|
(47
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchases of common stock
|
(62
|
)
|
|
—
|
|
|
—
|
|
|
(62
|
)
|
|
—
|
|
|
—
|
|
||||||
Issuance of ESPP shares
|
5
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
||||||
Distributions to noncontrolling interests
|
(28
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(28
|
)
|
||||||
Other noncontrolling interests activity
|
(3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3
|
)
|
||||||
Net income
|
226
|
|
|
—
|
|
|
203
|
|
|
—
|
|
|
—
|
|
|
23
|
|
||||||
Other comprehensive income, net of tax
|
47
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
45
|
|
|
2
|
|
||||||
Balance at December 31, 2015
|
$
|
1,052
|
|
|
$
|
2,070
|
|
|
$
|
595
|
|
|
$
|
(769
|
)
|
|
$
|
(831
|
)
|
|
$
|
(13
|
)
|
Share-based compensation
|
18
|
|
|
18
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Tax benefit decrease related to share-based plans
|
1
|
|
|
1
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Dividends declared to shareholders
|
(46
|
)
|
|
—
|
|
|
(46
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Repurchases of common stock
|
(4
|
)
|
|
—
|
|
|
—
|
|
|
(4
|
)
|
|
—
|
|
|
—
|
|
||||||
Issuance of ESPP shares
|
3
|
|
|
(1
|
)
|
|
—
|
|
|
4
|
|
|
—
|
|
|
—
|
|
||||||
Distributions to noncontrolling interests
|
(9
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
||||||
Net income (loss)
|
(51
|
)
|
|
—
|
|
|
(61
|
)
|
|
—
|
|
|
—
|
|
|
10
|
|
||||||
Other comprehensive income (loss), net of tax
|
(219
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(219
|
)
|
|
—
|
|
||||||
Balance at December 31, 2016
|
$
|
745
|
|
|
$
|
2,088
|
|
|
$
|
488
|
|
|
$
|
(769
|
)
|
|
$
|
(1,050
|
)
|
|
$
|
(12
|
)
|
|
December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Accumulated foreign currency translation adjustments, net of tax of $(2), $1 and $4
|
$
|
(262
|
)
|
|
$
|
(269
|
)
|
|
$
|
(203
|
)
|
Pension and post-retirement benefits, net of tax of $254, $209 and $231
|
(785
|
)
|
|
(560
|
)
|
|
(670
|
)
|
|||
Changes in fair value of derivatives, net of tax of $0, $0 and $0
|
(3
|
)
|
|
(2
|
)
|
|
(3
|
)
|
|||
Total accumulated other comprehensive loss
|
$
|
(1,050
|
)
|
|
$
|
(831
|
)
|
|
$
|
(876
|
)
|
Dollars in millions
|
Accumulated foreign currency translation adjustments
|
|
Pension and post-retirement benefits
|
|
Changes in fair value of derivatives
|
|
Total
|
||||||||
Balance as of December 31, 2014
|
$
|
(203
|
)
|
|
$
|
(670
|
)
|
|
$
|
(3
|
)
|
|
$
|
(876
|
)
|
Other comprehensive income adjustments before reclassifications
|
(70
|
)
|
|
71
|
|
|
—
|
|
|
1
|
|
||||
Amounts reclassified from accumulated other comprehensive income
|
4
|
|
|
39
|
|
|
1
|
|
|
44
|
|
||||
Balance at December 31, 2015
|
$
|
(269
|
)
|
|
$
|
(560
|
)
|
|
$
|
(2
|
)
|
|
$
|
(831
|
)
|
Other comprehensive income adjustments before reclassifications
|
7
|
|
|
(249
|
)
|
|
—
|
|
|
(242
|
)
|
||||
Amounts reclassified from accumulated other comprehensive income
|
—
|
|
|
24
|
|
|
(1
|
)
|
|
23
|
|
||||
Balance at December 31, 2016
|
$
|
(262
|
)
|
|
$
|
(785
|
)
|
|
$
|
(3
|
)
|
|
$
|
(1,050
|
)
|
Dollars in millions
|
December 31, 2016
|
|
December 31, 2015
|
|
Affected line item on the Consolidated Statements of Operations
|
||||
Pension and post-retirement benefits
|
|
|
|
|
|
||||
Amortization of actuarial loss (a)
|
$
|
(29
|
)
|
|
$
|
(48
|
)
|
|
See (a) below
|
Tax benefit (expense)
|
5
|
|
|
9
|
|
|
Provision for income taxes
|
||
Net pension and post-retirement benefits
|
$
|
(24
|
)
|
|
$
|
(39
|
)
|
|
Net of tax
|
|
(a)
|
This item is included in the computation of net periodic pension cost. See Note
12
to our consolidated financial statements for further discussion.
|
Shares in millions
|
Shares
|
|
Balance at December 31, 2014
|
174.4
|
|
Common stock issued
|
0.7
|
|
Balance at December 31, 2015
|
175.1
|
|
Common stock issued
|
0.8
|
|
Balance at December 31, 2016
|
175.9
|
|
Shares and dollars in millions
|
Shares
|
|
Amount
|
|||
Balance at December 31, 2014
|
29.6
|
|
|
$
|
712
|
|
Treasury stock acquired, net of ESPP shares issued
|
3.4
|
|
|
57
|
|
|
Balance at December 31, 2015
|
33.0
|
|
|
769
|
|
|
Treasury stock acquired, net of ESPP shares issued
|
0.1
|
|
|
—
|
|
|
Balance at December 31, 2016
|
33.1
|
|
|
$
|
769
|
|
|
Year ending December 31, 2016
|
|||||||||
|
Number of Shares
|
|
Average Price per Share
|
|
Dollars in Millions
|
|||||
Repurchases under the $350 million authorized share repurchase program
|
—
|
|
|
n/a
|
|
|
$
|
—
|
|
|
Repurchases under the existing share maintenance program
|
—
|
|
|
n/a
|
|
|
—
|
|
||
Withheld to cover shares
|
249,891
|
|
|
14.93
|
|
|
4
|
|
||
Total
|
249,891
|
|
|
$
|
14.93
|
|
|
$
|
4
|
|
|
|
|
|
|
|
|||||
|
Year ending December 31, 2015
|
|||||||||
|
Number of Shares
|
|
Average Price per Share
|
|
Dollars in Millions
|
|||||
Repurchases under the $350 million authorized share repurchase program
|
2,992,687
|
|
|
$
|
17.43
|
|
|
$
|
52
|
|
Repurchases under the existing share maintenance program
|
466,974
|
|
|
15.43
|
|
|
7
|
|
||
Withheld to cover shares
|
182,964
|
|
|
16.98
|
|
|
3
|
|
||
Total
|
3,642,625
|
|
|
$
|
17.15
|
|
|
$
|
62
|
|
•
|
stock options, including incentive stock options and nonqualified stock options;
|
•
|
stock appreciation rights, in tandem with stock options or freestanding;
|
•
|
restricted stock;
|
•
|
restricted stock units;
|
•
|
cash performance awards; and
|
•
|
stock value equivalent awards.
|
|
|
Year ending December 31,
|
||||
KBR stock options range assumptions summary (a)
|
2015
|
||||
|
Range
|
||||
|
Start
|
|
End
|
||
Expected volatility range
|
33.92
|
%
|
|
39.65
|
%
|
Expected dividend yield range
|
1.15
|
%
|
|
2.13
|
%
|
Risk-free interest rate range
|
1.46
|
%
|
|
2.12
|
%
|
|
KBR stock options activity summary
|
Number
of Shares
|
|
Weighted
Average
Exercise Price
per Share
|
|
Weighted
Average
Remaining
Contractual
Term (years)
|
|
Aggregate
Intrinsic Value
(in millions)
|
|||||
Outstanding at December 31, 2015
|
3,482,657
|
|
|
$
|
23.83
|
|
|
6.55
|
|
$
|
2.92
|
|
Granted
|
—
|
|
|
—
|
|
|
|
|
|
|||
Exercised
|
(28,579
|
)
|
|
12.25
|
|
|
|
|
|
|||
Forfeited
|
(177,452
|
)
|
|
16.68
|
|
|
|
|
|
|||
Expired
|
(541,020
|
)
|
|
23.96
|
|
|
|
|
|
|||
Outstanding at December 31, 2016
|
2,735,606
|
|
|
$
|
23.81
|
|
|
5.89
|
|
$
|
2.40
|
|
Exercisable at December 31, 2016
|
2,091,530
|
|
|
$
|
25.44
|
|
|
5.23
|
|
$
|
1.90
|
|
Share-based compensation summary table
|
Years ended December 31,
|
||||||||||
Dollars in millions
|
2016
|
|
2015
|
|
2014
|
||||||
Share-based compensation
|
$
|
18
|
|
|
$
|
18
|
|
|
$
|
22
|
|
Income tax benefit recognized in net income for share-based compensation
|
$
|
6
|
|
|
$
|
7
|
|
|
$
|
8
|
|
Incremental compensation cost
|
$
|
8
|
|
|
$
|
2
|
|
|
$
|
2
|
|
|
Years ended December 31,
|
|||||||
Shares in millions
|
2016
|
|
2015
|
|
2014
|
|||
Basic weighted average common shares outstanding
|
142
|
|
|
144
|
|
|
146
|
|
Stock options and restricted shares
|
—
|
|
|
—
|
|
|
—
|
|
Diluted weighted average common shares outstanding
|
142
|
|
|
144
|
|
|
146
|
|
|
Years ended December 31,
|
||||||
Gains (losses) dollars in millions
|
2016
|
|
2015
|
||||
Balance Sheet Hedges - Fair Value
|
$
|
(7
|
)
|
|
$
|
(40
|
)
|
Balance Sheet Position - Remeasurement
|
27
|
|
|
50
|
|
||
Net
|
$
|
20
|
|
|
$
|
10
|
|
(Dollars in millions, except per share amounts)
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
Year
|
||||||||||
2016
|
|
|
|
|
|
|
|
|
|
||||||||||
Total revenues
|
$
|
996
|
|
|
$
|
1,009
|
|
|
$
|
1,073
|
|
|
$
|
1,190
|
|
|
$
|
4,268
|
|
Gross profit (loss) (a)
|
68
|
|
|
74
|
|
|
(36
|
)
|
|
6
|
|
|
112
|
|
|||||
Equity in earnings of unconsolidated affiliates
|
29
|
|
|
33
|
|
|
19
|
|
|
10
|
|
|
91
|
|
|||||
Operating income (loss) (a)
|
65
|
|
|
63
|
|
|
(67
|
)
|
|
(33
|
)
|
|
28
|
|
|||||
Net income (loss)
|
45
|
|
|
47
|
|
|
(57
|
)
|
|
(86
|
)
|
|
(51
|
)
|
|||||
Net income attributable to noncontrolling interests
|
(3
|
)
|
|
—
|
|
|
(6
|
)
|
|
(1
|
)
|
|
(10
|
)
|
|||||
Net income (loss) attributable to KBR
|
42
|
|
|
47
|
|
|
(63
|
)
|
|
(87
|
)
|
|
(61
|
)
|
|||||
Net income (loss) attributable to KBR per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income (loss) attributable to KBR per share—Basic
|
$
|
0.30
|
|
|
$
|
0.32
|
|
|
$
|
(0.44
|
)
|
|
$
|
(0.61
|
)
|
|
$
|
(0.43
|
)
|
Net income (loss) attributable to KBR per share—Diluted
|
$
|
0.30
|
|
|
$
|
0.32
|
|
|
$
|
(0.44
|
)
|
|
$
|
(0.61
|
)
|
|
$
|
(0.43
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
(Dollars in millions, except per share amounts)
|
First
|
|
Second
|
|
Third
|
|
Fourth
|
|
Year
|
||||||||||
2015
|
|
|
|
|
|
|
|
|
|
||||||||||
Total revenues
|
$
|
1,436
|
|
|
$
|
1,381
|
|
|
$
|
1,199
|
|
|
$
|
1,080
|
|
|
$
|
5,096
|
|
Gross profit
|
70
|
|
|
74
|
|
|
87
|
|
|
94
|
|
|
325
|
|
|||||
Equity in earnings of unconsolidated affiliates
|
35
|
|
|
53
|
|
|
35
|
|
|
26
|
|
|
149
|
|
|||||
Operating income
|
64
|
|
|
96
|
|
|
75
|
|
|
75
|
|
|
310
|
|
|||||
Net income
|
51
|
|
|
68
|
|
|
59
|
|
|
48
|
|
|
226
|
|
|||||
Net income attributable to noncontrolling interests
|
(7
|
)
|
|
(6
|
)
|
|
(4
|
)
|
|
(6
|
)
|
|
(23
|
)
|
|||||
Net income attributable to KBR
|
44
|
|
|
62
|
|
|
55
|
|
|
42
|
|
|
203
|
|
|||||
Net income attributable to KBR per share:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net income attributable to KBR per share—Basic
|
$
|
0.30
|
|
|
$
|
0.43
|
|
|
$
|
0.38
|
|
|
$
|
0.29
|
|
|
$
|
1.40
|
|
Net income attributable to KBR per share—Diluted
|
$
|
0.30
|
|
|
$
|
0.43
|
|
|
$
|
0.38
|
|
|
$
|
0.29
|
|
|
$
|
1.40
|
|
|
(a)
|
Gross profit and operating income in the fourth quarter of 2016 was unfavorably impacted by changes in estimated costs to complete a downstream EPC project in the U.S. of
$94 million
and the correction of an immaterial error of
$13 million
within our E&C business segment. See Note
2
to our consolidated financial statements. The acquisitions of Wyle and HTSI contributed
$24 million
to gross profit in the fourth quarter of 2016.
|
(a)
|
The following documents are filed as part of this report or incorporated by reference:
|
1.
|
The consolidated financial statements of the Company listed on page
51
of this annual report.
|
2.
|
The exhibits of the Company listed below under Item 15(b); all exhibits are incorporated herein by reference to a prior filing as indicated, unless designated by a * or **.
|
(b)
|
Exhibits:
|
Exhibit
Number |
|
Description
|
|
|
|
2.1
|
|
Agreement and Plan of Merger by and among Wyle Inc., KBR Holdings, LLC, Road Runner Merger Sub, Inc., and CSC Shareholder Services LLC dated as of May 18, 2016 (incorporated by reference to Exhibit 2.1 to KBR's current report on Form 8-K filed May 23, 2016; File No. 1-33146)
|
|
|
|
2.2
|
|
Purchase and Sale Agreement by and among Honeywell International Inc., Honeywell Technology Solutions Inc., and KBR Holdings, LLC dated as of August 12, 2016 (incorporated by reference to Exhibit 2.1 to KBR's current report on Form 8-K filed August 12, 2016; File No. 1-33146)
|
|
|
|
3.1
|
|
KBR Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to KBR’s current report on Form 8-K filed June 7, 2012; File No. 1-33146)
|
|
|
|
3.2
|
|
Amended and Restated Bylaws of KBR, Inc. (incorporated by reference to Exhibit 3.2 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
4.1
|
|
Form of specimen KBR common stock certificate (incorporated by reference to Exhibit 4.1 to KBR’s registration statement on Form S-1; Registration No. 333-133302)
|
|
|
|
10.1
|
|
Master Separation Agreement between Halliburton Company and KBR, Inc. dated as of November 20, 2006 (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated November 20, 2006; File No. 1-33146)
|
|
|
|
10.2
|
|
Tax Sharing Agreement, dated as of January 1, 2006, by and between Halliburton Company, KBR Holdings, LLC and KBR, Inc., as amended effective February 26, 2007 (incorporated by reference to Exhibit 10.2 to KBR’s Annual Report on Form 10-K for the year ended December 31, 2006; File No. 1-33146)
|
|
|
|
10.3
|
|
Employee Matters Agreement dated as of November 20, 2006, by and between Halliburton Company and KBR, Inc. (incorporated by reference to Exhibit 10.6 to KBR’s current report on Form 8-K dated November 20, 2006; File No. 1-33146)
|
|
|
|
10.4
|
|
Intellectual Property Matters Agreement dated as of November 20, 2006, by and between Halliburton Company and KBR, Inc. (incorporated by reference to Exhibit 10.7 to KBR’s current report on Form 8-K dated November 20, 2006; File No. 1-33146)
|
|
|
|
10.5
|
|
Form of Indemnification Agreement between KBR, Inc. and its directors and executive officers (incorporated by reference to Exhibit 10.7 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
10.6
|
|
Amended and Restated Revolving Credit Agreement dated as of September 25, 2015 among KBR, Inc., the Banks party thereto, Citibank, N.A., as Administrative Agent, Bank of America, N.A., ING Bank, N.V., Dublin Branch, BNP Paribas, and The Bank of Nova Scotia as Syndication Agents, Citibank, N.A., BNP Paribas, ING Bank, N.V., Dublin Branch, The Bank of Nova Scotia, Bank of America, N.A., and Compass Bank as initial Issuing Banks, and Citigroup Global Markets Inc., BNP Paribas Securities Corp., Merrill Lynch, Pierce, Fenner & Smith Inc., ING Bank, N.V., Dublin Branch, and The Bank of Nova Scotia as Joint Lead Arrangers and Bookrunners (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated September 25, 2015; File No. 1-33146)
|
|
|
|
10.7
|
|
First Amendment to Amended and Restated Credit Agreement dated as of December 21, 2016 to the Amended and Restated Revolving Credit Agreement dated as of September 25, 2015 (the “Credit Agreement”) among KBR, Inc., the several banks and other institutions parties to the Credit Agreement, Citibank, NA., as administrative agent, and Bank of America, N.A., ING Bank, N.V., Dublin Branch, BNP Paribas, and The Bank of Nova Scotia as Syndication Agents (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated December 21, 2016; File No. 1-33146)
|
|
|
|
10.8
|
|
Guaranty Agreement dated as of May 18, 2016 by and between KBR, Inc. in favor of Wyle Inc. (incorporated by reference to Exhibit 10.1 to KBR's current report on Form 8-K filed May 23, 2016; File No. 1-33146)
|
|
|
|
10.9
|
|
Guaranty Agreement dated as of August 12, 2016 by and between KBR, Inc. in favor of Honeywell International Inc. (incorporated by reference to Exhibit 10.1 to KBR's current report on Form 8-K filed August 12, 2016; File No. 1-33146)
|
|
|
|
10.10+
|
|
KBR, Inc. 2006 Stock and Incentive Plan (As Amended and Restated March 7, 2012) (incorporated by reference to KBR's definitive Proxy Statement dated April 5, 2012; File No. 1-33146)
|
|
|
|
10.11+
|
|
KBR, Inc. 2006 Stock and Incentive Plan, as amended and restated effective May 16, 2016 (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K filed May 18, 2016; File No. 1-33146)
|
|
|
|
Exhibit
Number |
|
Description
|
10.12+
|
|
KBR, Inc. Senior Executive Performance Pay Plan (incorporated by reference to Exhibit 10.10 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
10.13+
|
|
KBR, Inc. Management Performance Pay Plan (incorporated by reference to Exhibit 10.11 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
10.14+
|
|
KBR, Inc. Transitional Stock Adjustment Plan (incorporated by reference to Exhibit 10.23 to KBR’s Form 10-K for the fiscal year ended December 31, 2006; File No. 1-33146)
|
|
|
|
10.15+
|
|
KBR Dresser Deferred Compensation Plan (incorporated by reference to Exhibit 4.5 to KBR’s Registration Statement on Form S-8 filed on April 13, 2007)
|
|
|
|
10.16+
|
|
KBR Supplemental Executive Retirement Plan (incorporated by reference to Exhibit 10.3 to KBR’s current report on Form 8-K dated April 9, 2007; File No. 1-33146)
|
|
|
|
10.17+
|
|
KBR Benefit Restoration Plan (incorporated by reference to Exhibit 10.4 to KBR’s current report on Form 8-K dated April 9, 2007; File No. 1-33146)
|
|
|
|
10.18+
|
|
KBR Elective Deferral Plan (incorporated by reference to Exhibit 10.5 to KBR’s current report on Form 8-K dated April 9, 2007; File No. 1-33146)
|
|
|
|
10.19+
|
|
KBR Non-Employee Directors Elective Deferral Plan (incorporated by reference to Exhibit 10.1 to KBR's current report on Form 8-K dated December 11, 2013; File No. 1-33146)
|
|
|
|
10.20+
|
|
Form of Stock Option Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended June 30, 2007; File No. 1-33146)
|
|
|
|
10.21+
|
|
Form of KBR Restricted Stock Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.4 to KBR’s quarterly report on Form 10-Q for the period ended June 30, 2007; File No. 1-33146)
|
|
|
|
10.22+
|
|
Form of KBR, Inc. Transitional Stock Adjustment Plan Stock Option Award (incorporated by reference to Exhibit 10.5 to KBR’s quarterly report on Form 10-Q for the period ended June 30, 2007; File No. 1-33146)
|
|
|
|
10.23+
|
|
Form of revised KBR Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.25 to KBR’s annual report on Form 10-K for the year ended December 31, 2010; File No. 1-33146)
|
|
|
|
10.24+
|
|
Form of revised KBR Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.25 to KBR’s annual report on Form 10-K for the year ended December 31, 2012; File No. 1-33146)
|
|
|
|
10.25+
|
|
Form of revised Nonstatutory Stock Option Agreement for US and Non-US Employees pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.26+
|
|
Form of revised Restricted Stock Unit Agreement (U.S. Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.27+
|
|
Form of revised Restricted Stock Unit Agreement (International Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.5 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.28+
|
|
Form of revised Restricted Stock Unit Agreement (Director) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.29+
|
|
Form of revised Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.4 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.30+
|
|
Form of Restricted Stock Unit Agreement (Three-Year Cliff Vesting) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.29 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
Exhibit
Number |
|
Description
|
10.31+
|
|
Form of revised KBR Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2014; File No. 1-33146)
|
|
|
|
10.32+
|
|
Form of revised Nonstatutory Stock Option Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2014; File No. 1-33146)
|
|
|
|
10.33+
|
|
Form of revised Restricted Stock Unit Agreement (U.S. Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2014; File No. 1-33146)
|
|
|
|
10.34+
|
|
Form of revised Restricted Stock Unit Agreement (U.S. Employee - 3 Year Vesting) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended September 31, 2014; File No. 1-33146)
|
|
|
|
10.35+
|
|
Form of revised Restricted Stock Unit Agreement (International Employee - 3 Year Vesting) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended September 31, 2014; File No. 1-33146)
|
|
|
|
10.36+
|
|
Form of Restricted Stock Unit Agreement (U.S. Employee - 3 Year Vesting; Involuntary Termination Trigger) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended September 31, 2014; File No. 1-33146)
|
|
|
|
10.37+
|
|
Form of Restricted Stock Unit Agreement (U.S. Employee - 5 Year Vesting; TSR Requirement) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.4 to KBR’s quarterly report on Form 10-Q for the period ended September 31, 2014; File No. 1-33146)
|
|
|
|
10.38+
|
|
Form of Restricted Stock Unit Agreement (U.S. Employee - 3 Year Vesting; TSR Requirement) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.39 to KBR’s annual report on Form 10-K/A for the fiscal year ended December 31, 2015; File No. 1-33146)
|
|
|
|
10.39+
|
|
Form of KBR Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.40 to KBR’s Form annual report on 10-K for the year ended December 31, 2015; File No. 1-33146)
|
|
|
|
10.40+
|
|
Form of revised Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2015; File No. 1-33146)
|
|
|
|
10.41+
|
|
Form of revised Restricted Stock Unit Agreement (US Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.42+
|
|
Form of revised Restricted Stock Unit Agreement (International Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.43+
|
|
Form of revised Performance Stock Unit Agreement (US Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.44+
|
|
Form of revised Performance Stock Unit Agreement (International Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.4 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.45+
|
|
Form of revised Performance Award Agreement (US/International Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.5 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.46+
|
|
Form of Severance and Change in Control Agreement (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended September 30, 2008; File No. 1-33146)
|
|
|
|
10.47+
|
|
Amendment to the 2008 Severance and Change in Control Agreements effective as of December 31, 2008 (incorporated by reference to Exhibit 10.36 to KBR’s annual report on Form 10-K for the year ended December 31, 2011; File No. 1-33146)
|
|
|
|
Exhibit
Number |
|
Description
|
10.48+
|
|
Severance and Change of Control Agreement effective as of July 9, 2012, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Ivor Harrington (incorporated by reference to Exhibit 10.1 to KBR's current report on Form 8-K dated July 9, 2012; File No. 1-33146)
|
|
|
|
10.49+
|
|
Severance and Change in Control Agreement effective as of June 2, 2014, between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc. and Stuart J. Bradie (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated April 9, 2014; File No. 1-33146)
|
|
|
|
10.50+
|
|
Severance and Change of Control Agreement effective as of December 11, 2011, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Roy Oelking (incorporated by reference to Exhibit 10.38 to KBR’s annual report on Form 10-K for the year ended December 31, 2012; File No. 1-33146)
|
|
|
|
10.51+
|
|
Severance and Change of Control Agreement effective as of December 14, 2011, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Mitch Dauzat (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended September 30, 2013; File No. 1-33146)
|
|
|
|
10.52+
|
|
Severance and Change of Control Agreement effective as of October 28, 2013, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Brian Ferraioli (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated October 28, 2013; File No. 1-33146)
|
|
|
|
10.53+
|
|
Form of Amendment to Severance and Change in Control Agreement (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended September 30, 2015; File No. 1-33146)
|
|
|
|
10.54+
|
|
Severance and Change of Control Agreement effective as of February 23, 2017, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Mark Sopp (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated December 12, 2016; File No. 1-33146)
|
|
|
|
*21.1
|
|
List of subsidiaries
|
|
|
|
*23.1
|
|
Consent of KPMG LLP—Houston, Texas
|
|
|
|
*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 materials from the Company’s Annual Report on Form 10-K for the period ended December 31, 2016, formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Operations, (ii) Consolidated Statements of Comprehensive Income (Loss), (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Shareholders' Equity, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements
|
+
|
Management contracts or compensatory plans or arrangements
|
|
|
|
|
*
|
Filed with this Form 10-K
|
|
|
|
|
**
|
Furnished with this Form 10-K
|
|
***
|
Interactive data files
|
|
(Dollars in Millions)
|
|
|
Additions
|
|
|
|
|
||||||||||||
Descriptions
|
Balance at
Beginning
Period
|
|
Charged to
Costs and
Expenses
|
|
Charged to
Other
Accounts
|
|
Deductions
|
|
Balance at
End of Period
|
||||||||||
Year ended December 31, 2016:
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from accounts and notes receivable:
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
$
|
17
|
|
|
$
|
(2
|
)
|
|
$
|
—
|
|
|
$
|
(1
|
)(a)
|
|
$
|
14
|
|
Reserve for losses on uncompleted contracts
|
$
|
60
|
|
|
$
|
331
|
|
|
$
|
—
|
|
|
$
|
(328
|
)
|
|
$
|
63
|
|
Reserve for potentially disallowable costs incurred under government contracts
|
$
|
50
|
|
|
$
|
10
|
|
|
$
|
6
|
(b)
|
|
$
|
(2
|
)
|
|
$
|
64
|
|
Year ended December 31, 2015:
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from accounts and notes receivable:
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
$
|
19
|
|
|
$
|
2
|
|
|
$
|
—
|
|
|
$
|
(4
|
)(a)
|
|
$
|
17
|
|
Reserve for losses on uncompleted contracts
|
$
|
159
|
|
|
$
|
69
|
|
|
$
|
—
|
|
|
$
|
(168
|
)
|
|
$
|
60
|
|
Reserve for potentially disallowable costs incurred under government contracts
|
$
|
74
|
|
|
$
|
—
|
|
|
$
|
3
|
(b)
|
|
$
|
(27
|
)
|
|
$
|
50
|
|
Year ended December 31, 2014:
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from accounts and notes receivable:
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
$
|
18
|
|
|
$
|
11
|
|
|
$
|
—
|
|
|
$
|
(10
|
)(a)
|
|
$
|
19
|
|
Reserve for losses on uncompleted contracts
|
$
|
109
|
|
|
$
|
278
|
|
|
$
|
—
|
|
|
$
|
(228
|
)
|
|
$
|
159
|
|
Reserve for potentially disallowable costs incurred under government contracts
|
$
|
91
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(17
|
)
|
|
$
|
74
|
|
|
(a)
|
Receivable write-offs, net of recoveries, and reclassifications.
|
(b)
|
Reserves have been recorded as reductions of revenues, net of reserves no longer required.
|
KBR, INC.
|
|
(Registrant)
|
|
|
|
By:
|
/s/ Stuart Bradie
|
|
Stuart Bradie
|
|
President and Chief Executive Officer
|
Signature
|
|
Title
|
|
|
|
/s/ Stuart Bradie
|
|
Principal Executive Officer,
|
Stuart Bradie
|
|
President, Chief Executive Officer and Director
|
|
|
|
/s/ Brian K. Ferraioli
|
|
Principal Financial Officer,
|
Brian K. Ferraioli
|
|
Executive Vice President and Chief Financial Officer
|
|
|
|
/s/ Nelson E. Rowe
|
|
Principal Accounting Officer,
|
Nelson E. Rowe
|
|
Vice President and Chief Accounting Officer
|
|
|
|
/s/ Mark E. Baldwin
|
|
Director
|
Mark E. Baldwin
|
|
|
|
|
|
/s/ James R. Blackwell
|
|
Director
|
James R. Blackwell
|
|
|
|
|
|
/s/ Loren K. Carroll
|
|
Director
|
Loren K. Carroll
|
|
|
|
|
|
/s/ Jeffrey E. Curtiss
|
|
Director
|
Jeffrey E. Curtiss
|
|
|
|
|
|
/s/ Lester L. Lyles
|
|
Director
|
Lester L. Lyles
|
|
|
|
|
|
/s/ Jack B. Moore
|
|
Director
|
Jack B. Moore
|
|
|
|
|
|
/s/ Ann D. Pickard
|
|
Director
|
Ann D. Pickard
|
|
|
|
|
|
/s/ Umberto della Sala
|
|
Director
|
Umberto della Sala
|
|
|
|
|
|
/s/ Richard J. Slater
|
|
Director
|
Richard J. Slater
|
|
|
|
|
|
Exhibit
Number
|
|
Description
|
|
|
|
2.1
|
|
Agreement and Plan of Merger by and among Wyle Inc., KBR Holdings, LLC, Road Runner Merger Sub, Inc., and CSC Shareholder Services LLC dated as of May 18, 2016 (incorporated by reference to Exhibit 2.1 to KBR's current report on Form 8-K filed May 23, 2016; File No. 1-33146)
|
|
|
|
2.2
|
|
Purchase and Sale Agreement by and among Honeywell International Inc., Honeywell Technology Solutions Inc., and KBR Holdings, LLC dated as of August 12, 2016 (incorporated by reference to Exhibit 2.1 to KBR's current report on Form 8-K filed August 12, 2016; File No. 1-33146)
|
|
|
|
3.1
|
|
KBR Amended and Restated Certificate of Incorporation (incorporated by reference to Exhibit 3.1 to KBR’s current report on Form 8-K filed June 7, 2012; File No. 1-33146)
|
|
|
|
3.2
|
|
Amended and Restated Bylaws of KBR, Inc. (incorporated by reference to Exhibit 3.2 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
4.1
|
|
Form of specimen KBR common stock certificate (incorporated by reference to Exhibit 4.1 to KBR’s registration statement on Form S-1; Registration No. 333-133302)
|
|
|
|
10.1
|
|
Master Separation Agreement between Halliburton Company and KBR, Inc. dated as of November 20, 2006 (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated November 20, 2006; File No. 1-33146)
|
|
|
|
10.2
|
|
Tax Sharing Agreement, dated as of January 1, 2006, by and between Halliburton Company, KBR Holdings, LLC and KBR, Inc., as amended effective February 26, 2007 (incorporated by reference to Exhibit 10.2 to KBR’s Annual Report on Form 10-K for the year ended December 31, 2006; File No. 1-33146)
|
|
|
|
10.3
|
|
Employee Matters Agreement dated as of November 20, 2006, by and between Halliburton Company and KBR, Inc. (incorporated by reference to Exhibit 10.6 to KBR’s current report on Form 8-K dated November 20, 2006; File No. 1-33146)
|
|
|
|
10.4
|
|
Intellectual Property Matters Agreement dated as of November 20, 2006, by and between Halliburton Company and KBR, Inc. (incorporated by reference to Exhibit 10.7 to KBR’s current report on Form 8-K dated November 20, 2006; File No. 1-33146)
|
|
|
|
10.5
|
|
Form of Indemnification Agreement between KBR, Inc. and its directors and executive officers (incorporated by reference to Exhibit 10.7 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
10.6
|
|
Amended and Restated Revolving Credit Agreement dated as of September 25, 2015 among KBR, Inc., the Banks party thereto, Citibank, N.A., as Administrative Agent, Bank of America, N.A., ING Bank, N.V., Dublin Branch, BNP Paribas, and The Bank of Nova Scotia as Syndication Agents, Citibank, N.A., BNP Paribas, ING Bank, N.V., Dublin Branch, The Bank of Nova Scotia, Bank of America, N.A., and Compass Bank as initial Issuing Banks, and Citigroup Global Markets Inc., BNP Paribas Securities Corp., Merrill Lynch, Pierce, Fenner & Smith Inc., ING Bank, N.V., Dublin Branch, and The Bank of Nova Scotia as Joint Lead Arrangers and Bookrunners (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated September 25, 2015; File No. 1-33146)
|
|
|
|
10.7
|
|
First Amendment to Amended and Restated Credit Agreement dated as of December 21, 2016 to the Amended and Restated Revolving Credit Agreement dated as of September 25, 2015 (the “Credit Agreement”) among KBR, Inc., the several banks and other institutions parties to the Credit Agreement, Citibank, NA., as administrative agent, and Bank of America, N.A., ING Bank, N.V., Dublin Branch, BNP Paribas, and The Bank of Nova Scotia as Syndication Agents (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated December 21, 2016; File No. 1-33146)
|
|
|
|
10.8
|
|
Guaranty Agreement dated as of May 18, 2016 by and between KBR, Inc. in favor of Wyle Inc. (incorporated by reference to Exhibit 10.1 to KBR's current report on Form 8-K filed May 23, 2016; File No. 1-33146)
|
|
|
|
10.9
|
|
Guaranty Agreement dated as of August 12, 2016 by and between KBR, Inc. in favor of Honeywell International Inc. (incorporated by reference to Exhibit 10.1 to KBR's current report on Form 8-K filed August 12, 2016; File No. 1-33146)
|
|
|
|
10.10+
|
|
KBR, Inc. 2006 Stock and Incentive Plan (As Amended and Restated March 7, 2012) (incorporated by reference to KBR's definitive Proxy Statement dated April 5, 2012; File No. 1-33146)
|
|
|
|
10.11+
|
|
KBR, Inc. 2006 Stock and Incentive Plan, as amended and restated effective May 16, 2016 (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K filed May 18, 2016; File No. 1-33146)
|
|
|
|
Exhibit
Number
|
|
Description
|
10.12+
|
|
KBR, Inc. Senior Executive Performance Pay Plan (incorporated by reference to Exhibit 10.10 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
10.13+
|
|
KBR, Inc. Management Performance Pay Plan (incorporated by reference to Exhibit 10.11 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
10.14+
|
|
KBR, Inc. Transitional Stock Adjustment Plan (incorporated by reference to Exhibit 10.23 to KBR’s Form 10-K for the fiscal year ended December 31, 2006; File No. 1-33146)
|
|
|
|
10.15+
|
|
KBR Dresser Deferred Compensation Plan (incorporated by reference to Exhibit 4.5 to KBR’s Registration Statement on Form S-8 filed on April 13, 2007)
|
|
|
|
10.16+
|
|
KBR Supplemental Executive Retirement Plan (incorporated by reference to Exhibit 10.3 to KBR’s current report on Form 8-K dated April 9, 2007; File No. 1-33146)
|
|
|
|
10.17+
|
|
KBR Benefit Restoration Plan (incorporated by reference to Exhibit 10.4 to KBR’s current report on Form 8-K dated April 9, 2007; File No. 1-33146)
|
|
|
|
10.18+
|
|
KBR Elective Deferral Plan (incorporated by reference to Exhibit 10.5 to KBR’s current report on Form 8-K dated April 9, 2007; File No. 1-33146)
|
|
|
|
10.19+
|
|
KBR Non-Employee Directors Elective Deferral Plan (incorporated by reference to Exhibit 10.1 to KBR's current report on Form 8-K dated December 11, 2013; File No. 1-33146)
|
|
|
|
10.20+
|
|
Form of Stock Option Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended June 30, 2007; File No. 1-33146)
|
|
|
|
10.21+
|
|
Form of KBR Restricted Stock Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.4 to KBR’s quarterly report on Form 10-Q for the period ended June 30, 2007; File No. 1-33146)
|
|
|
|
10.22+
|
|
Form of KBR, Inc. Transitional Stock Adjustment Plan Stock Option Award (incorporated by reference to Exhibit 10.5 to KBR’s quarterly report on Form 10-Q for the period ended June 30, 2007; File No. 1-33146)
|
|
|
|
10.23+
|
|
Form of revised KBR Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.25 to KBR’s annual report on Form 10-K for the year ended December 31, 2010; File No. 1-33146)
|
|
|
|
10.24+
|
|
Form of revised KBR Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.25 to KBR’s annual report on Form 10-K for the year ended December 31, 2012; File No. 1-33146)
|
|
|
|
10.25+
|
|
Form of revised Nonstatutory Stock Option Agreement for US and Non-US Employees pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.26+
|
|
Form of revised Restricted Stock Unit Agreement (U.S. Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.27+
|
|
Form of revised Restricted Stock Unit Agreement (International Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.5 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.28+
|
|
Form of revised Restricted Stock Unit Agreement (Director) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.29+
|
|
Form of revised Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.4 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2013; File No. 1-33146)
|
|
|
|
10.30+
|
|
Form of Restricted Stock Unit Agreement (Three-Year Cliff Vesting) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.29 to KBR’s annual report on Form 10-K for the year ended December 31, 2013 filed on February 27, 2014; File No. 1-33146)
|
|
|
|
10.31+
|
|
Form of revised KBR Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2014; File No. 1-33146)
|
|
|
|
Exhibit
Number
|
|
Description
|
10.32+
|
|
Form of revised Nonstatutory Stock Option Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2014; File No. 1-33146)
|
|
|
|
10.33+
|
|
Form of revised Restricted Stock Unit Agreement (U.S. Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2014; File No. 1-33146)
|
|
|
|
10.34+
|
|
Form of revised Restricted Stock Unit Agreement (U.S. Employee - 3 Year Vesting) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended September 31, 2014; File No. 1-33146)
|
|
|
|
10.35+
|
|
Form of revised Restricted Stock Unit Agreement (International Employee - 3 Year Vesting) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended September 31, 2014; File No. 1-33146)
|
|
|
|
10.36+
|
|
Form of Restricted Stock Unit Agreement (U.S. Employee - 3 Year Vesting; Involuntary Termination Trigger) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended September 31, 2014; File No. 1-33146)
|
|
|
|
10.37+
|
|
Form of Restricted Stock Unit Agreement (U.S. Employee - 5 Year Vesting; TSR Requirement) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.4 to KBR’s quarterly report on Form 10-Q for the period ended September 31, 2014; File No. 1-33146)
|
|
|
|
10.38+
|
|
Form of Restricted Stock Unit Agreement (U.S. Employee - 3 Year Vesting; TSR Requirement) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.39 to KBR’s annual report on Form 10-K/A for the fiscal year ended December 31, 2015; File No. 1-33146)
|
|
|
|
10.39+
|
|
Form of KBR Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.40 to KBR’s Form annual report on 10-K for the year ended December 31, 2015; File No. 1-33146)
|
|
|
|
10.40+
|
|
Form of revised Performance Award Agreement pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2015; File No. 1-33146)
|
|
|
|
10.41+
|
|
Form of revised Restricted Stock Unit Agreement (US Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.42+
|
|
Form of revised Restricted Stock Unit Agreement (International Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.43+
|
|
Form of revised Performance Stock Unit Agreement (US Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.3 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.44+
|
|
Form of revised Performance Stock Unit Agreement (International Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.4 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.45+
|
|
Form of revised Performance Award Agreement (US/International Employee) pursuant to KBR, Inc. 2006 Stock and Incentive Plan (incorporated by reference to Exhibit 10.5 to KBR’s quarterly report on Form 10-Q for the period ended March 31, 2016; File No. 1-33146)
|
|
|
|
10.46+
|
|
Form of Severance and Change in Control Agreement (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended September 30, 2008; File No. 1-33146)
|
|
|
|
10.47+
|
|
Amendment to the 2008 Severance and Change in Control Agreements effective as of December 31, 2008 (incorporated by reference to Exhibit 10.36 to KBR’s annual report on Form 10-K for the year ended December 31, 2011; File No. 1-33146)
|
|
|
|
10.48+
|
|
Severance and Change of Control Agreement effective as of July 9, 2012, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Ivor Harrington (incorporated by reference to Exhibit 10.1 to KBR's current report on Form 8-K dated July 9, 2012; File No. 1-33146)
|
|
|
|
Exhibit
Number
|
|
Description
|
10.49+
|
|
Severance and Change in Control Agreement effective as of June 2, 2014, between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc. and Stuart J. Bradie (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated April 9, 2014; File No. 1-33146)
|
|
|
|
10.50+
|
|
Severance and Change of Control Agreement effective as of December 11, 2011, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Roy Oelking (incorporated by reference to Exhibit 10.38 to KBR’s annual report on Form 10-K for the year ended December 31, 2012; File No. 1-33146)
|
|
|
|
10.51+
|
|
Severance and Change of Control Agreement effective as of December 14, 2011, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Mitch Dauzat (incorporated by reference to Exhibit 10.1 to KBR’s quarterly report on Form 10-Q for the period ended September 30, 2013; File No. 1-33146)
|
|
|
|
10.52+
|
|
Severance and Change of Control Agreement effective as of October 28, 2013, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Brian Ferraioli (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated October 28, 2013; File No. 1-33146)
|
|
|
|
10.53+
|
|
Form of Amendment to Severance and Change in Control Agreement (incorporated by reference to Exhibit 10.2 to KBR’s quarterly report on Form 10-Q for the period ended September 30, 2015; File No. 1-33146)
|
|
|
|
10.54+
|
|
Severance and Change of Control Agreement effective as of February 23, 2017, by and between KBR Technical Services, Inc., a Delaware corporation, KBR, Inc., and Mark Sopp (incorporated by reference to Exhibit 10.1 to KBR’s current report on Form 8-K dated December 12, 2016; File No. 1-33146)
|
|
|
|
*21.1
|
|
List of subsidiaries
|
|
|
|
*23.1
|
|
Consent of KPMG LLP—Houston, Texas
|
|
|
|
*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 materials from the Company’s Annual Report on Form 10-K for the period ended December 31, 2016, formatted in XBRL (Extensible Business Reporting Language): (i) Consolidated Statements of Operations, (ii) Consolidated Statements of Comprehensive Income (Loss), (iii) Consolidated Balance Sheets, (iv) Consolidated Statements of Shareholders' Equity, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements
|
+
|
Management contracts or compensatory plans or arrangements
|
|
|
|
|
*
|
Filed with this Form 10-K
|
|
|
|
|
**
|
Furnished with this Form 10-K
|
|
|
|
|
***
|
Interactive data files
|
|
1 Year KBR Chart |
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