HOUSTON (AP) -- Engineering company and contractor KBR Inc. cut its 2012 net income forecast on Thursday, and issued a disappointing outlook for 2013.
The company expects to take major charges related to its minerals and U.S. construction divisions during the fourth quarter and said labor costs have been higher than it thought. KBR's shares fell almost 8 percent in aftermarket trading.
KBR now expects to report net income of $1.95 to $2.10 per share for 2012. In October the company said it still expected to make between $2.60 and $2.80 per share for the year. Both estimates exclude a large write-down the company took during the third quarter.
Analysts expected the company to earn $2.66 per share on average, according to FactSet.
Shares of KBR rose 2.4 percent to close at $32 on Thursday. In after-hours trading the stock dropped $2.50, or 7.8 percent, to $29.50.
KBR said it should earn $2.45 to $2.90 per share in 2013, which fell below analysts' estimates of $2.95 per share. It said some contracts awarded in late 2012 were delayed. As a result it expects to earn 90 cents to $1.10 per share in the first half of 2013, with stronger results in the second half of the year.
In the third quarter the company took a charge of $178 million, or $1.20 per share, to write down the value of Roberts & Schaefer. KBR bought the company in 2010, and said its value was hurt by a reduction in the business of handling solid fuel materials in North America as shale gas took off.
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