Foster Wheeler reported net income for the third quarter of 2012 of $58.2m, or $0.54 per diluted share, compared with $36.9m, or $0.31 per diluted share, in the third quarter of 2011.
Net income in both quarterly periods was impacted by asbestos-related provisions as detailed in an attached table. Excluding such items from both quarterly periods, net income in the third quarter of 2012 was $60.2m, or $0.56 per diluted share, compared with $38.8m, or $0.33 per diluted share, in the year-ago quarter.
For the first nine months of 2012, net income was $129.7m, or $1.20 per diluted share, compared with $123.1m, or $1.01 per diluted share, for the first nine months of 2011.
The company believes that quarterly averages provide meaningful comparative relevance for certain key metrics in light of the significant quarter-to-quarter variability that is inherent in the company’s financial results.
Foster Wheeler’s Chief Executive Officer, Kent Masters, said, “The company’s net income increased 43% in the third quarter of 2012 as compared with the average quarter of 2011 due largely to the performance of our Global Power Group, which reported a sharp increase in EBITDA and very strong margins.”
“Additionally, our Global Engineering and Construction Group booked a record-level of scope new orders, which generated a 31% sequential-quarter increase in scope backlog to more than $1.7bn.”
Also contributing to the improvement in adjusted net income in the third quarter of 2012 was an effective tax rate that was below the average 2011 rate.
Masters said, “In our Global Power Group, we are raising our full-year 2012 EBITDA margin guidance to 20% to 22%. We are maintaining our previous guidance on full-year scope revenues in GPG, specifically that we expect them to be essentially flat in 2012 as compared to 2011.”
He continued, “In our Global E&C Group, we are maintaining our full-year 2012 EBITDA margin guidance at 11% to 13%, but we are lowering our expectation regarding full-year scope revenues in our E&C Group, now expecting that they will be essentially flat in 2012 as compared to 2011.”
Masters said, “We continue to expect that our full-year earnings per share in 2012 will be materially higher than 2011.”
The company repurchased 1,944,210 shares during the third quarter of 2012 for approximately $40m. As of September 30, 2012, the company had approximately $460m remaining under its authorised share repurchase program.