KBR Inc Overview
KBR is a Houston-based provider of science, technology and engineering solutions. It has two distinct franchises.
The first is Mission Technology Solutions (MTS), a ~USD 5.6B government-services business. MTS serves the U.S. Department of Defense, intelligence community, NASA and other civil agencies, the U.K. Ministry of Defence and the Australian Defence Force. Its work spans space, defense modernization, C5ISR, health and human performance, and global logistics and readiness.
The second is Sustainable Technology Solutions (STS), a ~USD 2.2B, high-margin (~22% adjusted EBITDA margin) franchise. STS is anchored on more than 85 proprietary process technologies in ammonia/syngas, petrochemicals, clean refining and circular plastics. Around these it adds advisory, engineering and digital services.
KBR is now in the final quarter before a planned January 2027 spin-off. MTS will become "Trinzic" (more than USD 5B revenue, ~18,000 employees). The remaining KBR ("New KBR", ~15,000 employees in more than 40 countries) will be a capital-light, IP-led lifecycle solutions company for energy, industrial and infrastructure markets.
Company's own description
In its FY2024 10-K, KBR described itself as delivering "science, technology, engineering and logistics support solutions to governments and companies around the world." It said it combines deep domain expertise with full life-cycle capabilities.
Its stated capability set covers six areas:
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National security and defense systems engineering, rapid prototyping, test and evaluation, acquisition support and sustainment engineering.
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Operational expertise in space domain awareness, C5ISR, human spaceflight, satellite operations, integrated supply chain and military aviation support.
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Advanced digital, AI/ML and information operations.
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Scientific research, including quantum science, health and human performance, materials, life sciences and earth sciences.
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Engineering and project management for energy security, decarbonization and energy transition, plus proprietary sustainability-focused process licensing.
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Professional advisory services across defense, renewable energy and critical infrastructure.
The 1 October 2026 press release describes the post-spin company differently. "New KBR" is described as "a global, capital-light lifecycle solutions company serving customers in high-complexity industrial, energy and infrastructure markets."
Business model and revenue model
KBR is overwhelmingly a services and technology-licensing company rather than a product manufacturer. Its revenue model has several components.
Government services (MTS, ~72% of FY2025 revenue).
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Contracts are predominantly cost-reimbursable (cost-plus-fixed-fee or award-fee), with time-and-materials and firm-fixed-price task orders alongside.
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Work is delivered through single-award and multiple-award IDIQ vehicles, for example IAC MAC, OASIS+, SHIELD, WEXMAC, LOGCAP V and GLOBALCAP.
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U.K. Private Finance Initiatives (PFIs) are 15–35-year availability-based contracts (Aspire Defence, UKMFTS/Affinity), largely held through equity-method JVs.
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U.S. government revenue was 57% of consolidated revenue in FY2024 (USD 4,382M). U.K. government revenue was 9% (USD 674M) (FY2024 10-K).
Technology and services (STS, ~28% of FY2025 revenue).
Licensing fees: for proprietary process technologies, typically paid in milestones.
Proprietary equipment and catalysts: STS signed its first long-term (10-year) ammonia catalyst supply agreement in Q1 FY2026.
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Front-end and detailed engineering, project management consultancy (PMC) and advisory.
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Digitally enabled operations and maintenance services, for example Petro Rabigh's 10-year maintenance contract.
Equity-method JV earnings: Examples include the KZJV LNG project with Zachry (45%), Brown & Root Industrial Services (BRIS) (50%), and the legacy JKC Ichthys (30%).
- KBR has deliberately exited lump-sum turnkey EPC risk. JV income is significant: equity in earnings of unconsolidated affiliates was USD 210M in FY2025 versus USD 107M in FY2024.
Subscription and licensing mix.
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KBR does not report a subscription line.
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Licensing and proprietary equipment revenue is not separately quantified in the filings reviewed and is "not publicly disclosed" as a stand-alone figure.
Value-chain position
MTS sits at the high-end professional and technical services tier of the defense and space value chain. This covers systems engineering, mission operations, analytics and readiness. It is not a platform manufacturer and is typically a prime contractor.
STS sits at the front of the industrial capital cycle:
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technology selection and licensing;
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feasibility and front-end engineering design (FEED);
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advisory and PMC;
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then into the operating phase through maintenance, turnarounds (via BRIS) and digital optimization.
It largely avoids fixed-price construction.
Customer types and end-markets
| End-market | Representative customers |
|---|---|
| U.S. defense & intelligence | U.S. Army, Navy, Air Force, Space Force, Missile Defense Agency, NGA, NRO, other IC agencies |
| U.S. civil / science | NASA, U.S. Geological Survey, NOAA, National Science Foundation |
| International government | U.K. MoD and Crown services (incl. Ministry of Justice), Royal Australian Air Force/Navy/Army |
| Energy & chemicals | NOCs and IOCs, e.g., Basra Oil Company, Petro Rabigh, BP (KBR SOCAR JV), Qatar offshore, ENKA |
| Fertilizer / ammonia | Indorama Eleme, Pampa Energía, IGNIS |
| Low-carbon fuels | NorSAF, Keppel/Aster, Power2X, Fikrat Al-Tadweer |
| Circular plastics | Mitsubishi Chemical / ENEOS (Hydro-PRT plant) |
Independent characterization
KBR has spent a decade (2014–2025) transforming from a cyclical, risk-heavy hydrocarbons engineering and construction contractor into two businesses:
MTS: a scaled, cost-plus government technical-services platform with mid-single-digit growth and ~10–12% adjusted EBITDA margins.
STS: an IP-led industrial technology franchise with ~20%+ margins.
The conglomerate discount between these two very different profiles is the explicit rationale for the 2027 spin-off. Equity-market performance has been weak: the share price is down ~27% over 52 weeks. This reflects several factors:
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the HomeSafe termination in 2025;
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EUCOM contingency run-off;
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U.S. federal civilian funding pressure;
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~USD 10.6B of awarded work tied up in protests.
Meanwhile underlying margins and cash conversion have improved materially.
Strategy
Stated strategy themes
FY2024 10-K growth vectors:
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defense modernization;
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national security space superiority;
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health and human performance;
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sustainable energy and industrial technology;
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high-end defense engineering;
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energy security and energy transition;
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digital asset modernization and optimization.
Capital-deployment priorities (10-K), in stated order:
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Fund organic growth.
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Maintain responsible leverage.
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Maintain an attractive dividend.
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Make strategic, accretive acquisitions.
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Repurchase shares.
2026 proxy CEO letter. Four themes:
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Disciplined execution and record capital returns.
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Both segments positioned for growth.
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Earnings quality through selectivity, mix and innovation.
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Spin readiness.
New KBR's stated focus areas include new nuclear, ammonia, hydrogen, critical minerals and other energy vectors, a "digital-first strategy" and "mega-scale infrastructure" experience.
Strategic initiatives, last 24 months
| Initiative | Date | Detail | Status |
|---|---|---|---|
| Segment realignment (GS → MTS) | Jan 2025 | Integrated international government business; created COO role; cost savings cited in FY2025 Q4 MTS SG&A | Complete; COO role vacated in 2025 |
| Chair/CEO combination | May 2025 | Bradie Chair; Lead Independent Director role created | Complete |
| HomeSafe exit | Jun 2025 | Termination by TRANSCOM; disposed; discontinued operations | Complete |
| MTS spin-off (Trinzic) | Announced 24 Sep 2025; target 4 Jan 2027 | Tax-free spin intended (IRS private letter ruling / opinion; Form 10; financing) | In progress; leadership and brand in place |
| Pre-spin perimeter changes | FY2026 | Frazer-Nash and U.K. Civil Nuclear moved to STS | Complete |
| Recurring services via JVs | Q4 FY2025–Jan 2026 | BRIS acquires SWAT; capital-light OPEX growth strategy | Closed 6 Jan 2026 |
| Long-term catalyst supply | Q1 FY2026 | First 10-year ammonia catalyst contract (Indorama Eleme) | Signed |
| Low-carbon fuels technology push | 2025–2026 | PureSAF, PureM and K-GreeN awards in Europe, Middle East and Asia | Ongoing |
| AI and digital investment | 2025–2026 | "Revolutionary new AI tools" (2026 proxy); AI tools embedded in ASESC bid | Ongoing; spend not disclosed |
| ERP implementation | 2,025 | New ERP system raising STS SG&A (Q4 FY2025) | In progress |
| Separation cost-structure actions | 2,026 | "Simplify our cost structure" (Q2 FY2026); USD 46M of spin-off and other charges in H1 FY2026 | Ongoing |
| Sustainability | Ongoing | Carbon-neutral operations annually since 2019; 1.5°C-aligned 2030 near-term and 2050 targets; 35% of FY2025 revenue sustainability-focused | Ongoing |
Guidance and medium-term targets
| Metric | Low | High | Midpoint |
|---|---|---|---|
| Revenue (USD B) | 7.90 | 8.36 | 8.13 |
| Adjusted EBITDA (USD M) | 980 | 1,040 | 1,010 |
| Adjusted EPS (USD) | 3.87 | 4.22 | 4.05 |
| Adjusted operating cash flow (USD M) | 560 | 600 | 580 |
FY2026 assumptions:
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capex ~USD 40–50M;
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effective tax rate 26–28%;
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D&A ~USD 165M;
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~127M adjusted shares;
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phasing 46% in H1 and 54% in H2.
Medium-term targets.
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KBR's FY2027 financial targets were "updated for the HomeSafe termination" in the Q2 FY2025 release.
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The January 2025 realignment release referenced an STS revenue CAGR target of 11–15%.
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Standalone outlooks for New KBR and Trinzic are expected in connection with the spin. The Oct 2026 release says additional separation-related updates are expected "in the coming months".
Products & Services
KBR does not publish a price list. Pricing is contract-specific: cost-plus, T&M or FFP for government work, and license fee plus engineering/equipment for STS. Launch years are given where disclosed.
Mission Technology Solutions (future Trinzic)
| Offering / program | Description & capabilities | Target customer | Status / year | Commercial model |
|---|---|---|---|---|
| Human Health & Performance (NASA HHPC) | Astronaut health, biomedical research, ISS/human-spaceflight medical operations support; held since 2015 | NASA Johnson Space Center | Recompete won 2025 | Cost-type contract. Ceiling reported as USD 2.5B base period (2026 proxy) and USD 3.6B (Washington Technology); figures differ, likely base vs. total |
| Space domain awareness & space operations | Satellite ops, space surveillance, mission planning; includes USD 176M Air Force space surveillance support | U.S. Space Force, AFRL, Space Systems Command | Ongoing | Cost-plus / FFP task orders |
| Digital engineering ecosystem (ASCEND2) | 10-year IDIQ to build a digital engineering ecosystem | U.S. Space Force | Awarded 2025; USD 970M ceiling | IDIQ |
| Digital Engineering & Enterprise Decision Support | Kirtland AFB, 5 years | U.S. Space Force | Awarded Q2 FY2026; USD 95M | CPFF |
| Decision Support for HQ Analysis | Digital engineering and assured communications | Space Force / AFRL / SSC | Q4 FY2025; USD 77M task order | FFP |
| ADEDDIS (AFLCMC) | Analytics, digital transformation and systems engineering, Eglin AFB | U.S. Air Force | Q4 FY2025; USD 149M ceiling | CPFF |
| Missile defense (SHIELD) | Seat on MDA's homeland/layered missile defense vehicle (incl. Golden Dome initiatives) | Missile Defense Agency | FY2025; USD 151B ceiling multi-award | IDIQ |
| Army Tactical Aviation & Ground Munitions (TAGM) | Engineering, prototyping, modernization, FMS and logistics for HELLFIRE, JAGM, Javelin, TOW, Hydra, long-range precision munitions | U.S. Army | 10 Aug 2026; ~USD 208M, 5-year recompete under OASIS+ | CPFF |
| IAC MAC / DoD research & analysis | Lifecycle R&A, e.g., USD 229M Army cargo helicopter task; over USD 800M IAC MAC task orders in 2021 | U.S. Army / DoD | Ongoing | Task orders |
| F/A-18 & EA-18G FMS support | Foreign Military Sales program support | NAVAIR | Q4 FY2025; USD 117M follow-on | CPFF |
| C5ISR / RF engineering | 40-year-plus RF engineering and modernization program, end-to-end manufacturing capability | Undisclosed U.S. government customer | 3-year renewal, Sep 2026 | T&M |
| Geospatial / GIS modernization | GIS modernization | NGA | 2026; USD 37.1M | — |
| ASTRA | Advisory & technical requirement administration | USAF, Department of War, IC | Q2 FY2026; USD 866M ceiling multi-award | IDIQ |
| LOGCAP V | Contingency logistics for EUCOM and NORTHCOM | U.S. Army | Extended through 2030 (2025) | Cost-type |
| Base operations support | E.g., Camp Lemonnier, Djibouti | U.S. Navy / DoD | 2025; USD 476M | — |
| WEXMAC 2.1 – TITUS | Expeditionary logistics / contingency ops | NAVSUP | FY2025 seat; USD 10B ceiling | IDIQ |
| GLOBALCAP | Global stability support (training, mentoring, logistics) | U.S. Department of State | FY2025 seat; USD 5B program | IDIQ |
| SOUTHCOM support | 7-year support contract | U.S. Southern Command | 2026; USD 910M (as reported by secondary source) | — |
| Antarctic Science & Engineering Support (ASESC) | Operation of 3 year-round Antarctic stations, 2 research vessels, camps, logistics, cyber, AI tools | National Science Foundation | Awarded 2 Jun 2026; USD 8B ceiling, 20 years; under re-evaluation after GAO decision | Hybrid IDIQ |
| USGS EROS | Technical support for the Earth Resources Observation & Science Center | U.S. Geological Survey | Q4 FY2025; USD 350M ceiling | — |
| NASA Wallops range | Range operations | NASA | Extended (~USD 250M) | — |
| NASA COSMOS (protest) | KBR incumbent; protest of USD 1.8B award to Ascend Aerospace led NASA to re-evaluate (2026) | NASA | Pending | Not applicable |
| Aspire Defence (45% JV) | Facilities lifecycle management, British Army garrisons at Aldershot and Salisbury Plain | U.K. MoD | PFI, long-term | Equity-method |
| UKMFTS / Affinity (50% JV with Elbit) | Procure, operate and maintain training aircraft, 18-year contract | U.K. MoD | PFI | Equity-method |
| Workplace Services Management | Facilities management across the prison and probation estate using Estates Intelligence and VIAverse | U.K. Ministry of Justice | 5 years + extensions; mobilization Q3 2026; full start 1 Jun 2027 | — |
| VIAverse platform | Proprietary asset/estate data and performance-monitoring platform | U.K. government estates | In service | Embedded in services |
| Australian defence support | ADF aviation, engineering and sustainment | RAAF, RAN, Army | Growth market (Q2 FY2026) | — |
| Axiom Space collaboration | Astronaut training, flight ops support, next-gen spacesuit development | Commercial space | Ongoing | Commercial |
Sustainable Technology Solutions (New KBR)
| Technology / service | Description | Target customer | Year / status | Model |
|---|---|---|---|---|
| Purifier ammonia process | Flagship ammonia synthesis technology. Selected for Pampa Energía's Bahía Blanca, Argentina ammonia-urea complex, expected to be Latin America's largest single-train ammonia plant | Fertilizer producers | Award Q2 FY2026 | License + engineering + equipment |
| K-GreeN | Fully developed, proprietary end-to-end green ammonia solution | Green hydrogen/ammonia developers (e.g., IGNIS, A Coruña, Spain) | In market | License + engineering |
| Ammonia catalysts | Long-term catalyst supply. First 10-year ammonia catalyst agreement with Indorama Eleme (Nigeria) | Ammonia plant owners | Q1 FY2026 | Recurring supply |
| Hydro-PRT | Exclusive licensor of supercritical-water technology converting mixed waste plastics into virgin-grade feedstock (technology originated with Mura Technology). Mitsubishi Chemical/ENEOS plant opened 2025 | Petrochemical producers | Commercial | License |
| PureSAF | Sustainable aviation fuel technology launched 2023. Selected by NorSAF (Latvia, 100 kt/yr SAF/e-SAF) and Keppel/Aster (Singapore, Jurong Island) | Fuel producers, refiners | Launched 2023; awards 2026 | License + FEED |
| PureM | Green methanol technology; biomethanol from landfill gas for Fikrat Al-Tadweer (Saudi Arabia) | Methanol/e-fuels developers | Award Q4 FY2025 | License + engineering |
| Phenol and petrochemical technologies | Transformation of raw materials into commodity chemicals such as phenol | Chemical producers | Long-established | License |
| Clean refining technologies | Portfolio within the "clean refining" vertical; individual technology names not itemized in reviewed filings | Refiners | Ongoing | License |
| Critical minerals processing | Technologies for conversion/refinement of minerals for electrification (FY2024 10-K) | Mining/processing | Emerging | Engineering/license |
| LNG engineering | KZJV (45%) design/engineering/procurement for Plaquemines LNG; FEED for Coastal Bend LNG (Texas) | LNG developers | Ongoing | Services; equity-method JV |
| Energy security engineering | Bul Hanine (Qatar offshore) detailed engineering; ENKA Basra Associated Gas Upstream Project Phase 2; BP Azerbaijan via KBR SOCAR JV | NOCs/IOCs | 2025–2026 awards | Reimbursable services |
| Integrated field management / EPCM | Majnoon oil field (Basra Oil Company), Iraq: EPCM renewal plus integrated field management contract | Basra Oil Company | Renewed 2025 | Services |
| Digitally enabled maintenance | 10-year general maintenance services, Petro Rabigh Polymer I & II (KSA) | Petrochemical operators | Q4 FY2025 | Recurring services |
| PMC for e-fuels | Power2X Rotterdam e-SAF (>250 kt/yr) | e-fuels developers | Q2 FY2026 | Consulting |
| Advisory & consulting | Energy transition, net-zero and energy-security advisory | Governments, industrials | Ongoing | Fee-based |
| Frazer-Nash Consultancy (moved to STS FY2026) | U.K. high-end engineering consultancy (defense, nuclear, energy) | U.K. government/industry | Acquired 2021 | Fee-based |
| U.K. Civil Nuclear (moved to STS FY2026) | New-nuclear and decommissioning engineering | U.K. nuclear sector | Ongoing | Fee-based |
| Brown & Root Industrial Services (50% JV) | Maintenance, turnarounds, small capital projects, North America; acquired SWAT (specialty welding, cooling tower, catalyst services) on 6 Jan 2026 | Refining/chemicals | Ongoing | Equity-method |
Financial Narrative
Basis. FY2024 and FY2025 are shown on a continuing-operations basis, excluding HomeSafe. FY2021–FY2023 are shown as originally reported.
Sources.
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KBR 8-K earnings exhibits for FY2021, FY2022, FY2023 and FY2025.
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The FY2023 10-K for FY2021–FY2023 pre-tax and net income.
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S&P Global Market Intelligence via StockAnalysis for gross profit, balance sheet and capex.
Income statement
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FY2024 pre-tax income and net income are on the recast continuing-operations basis. FY2025 pre-tax income is from continuing operations.
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FY2025 net income attributable includes USD (36)M from discontinued operations attributable to KBR; continuing operations contributed USD 451M.
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FY2025 diluted EPS from continuing operations was USD 3.49.
GAAP operating income as reported by KBR
- FY2021 company-reported GAAP operating income is not reproduced here; it was depressed by the USD 193M Ichthys non-cash charge to equity in earnings.
Margins (%)
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Revenue CAGR FY2021–FY2025: ~1.5% p.a. The FY2021 base was inflated by ~USD 1B of Operation Allies Welcome (OAW) Afghan-evacuee support revenue.
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Revenue CAGR FY2022–FY2025 (ex-OAW base effects): ~5.9% p.a.
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Adjusted EBITDA CAGR FY2021–FY2025: ~11.6% p.a.
Commentary.
Margin trajectory: The defining feature of the five-year record is a ~390 bp expansion in adjusted EBITDA margin, from 8.5% to 12.4%, on essentially flat revenue. Three drivers stand out:
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Mix shift toward high-end technical work: the Centauri, Frazer-Nash and LinQuest acquisitions, and STS licensing.
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Run-off of low-margin OAW and contingency logistics.
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Rising equity-method JV income, notably the KZJV LNG project.
Reported earnings volatility: Reported earnings have been distorted by legacy items:
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FY2021: USD 193M Ichthys non-cash charge.
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FY2022: USD 137M Ichthys power-plant subcontractor settlement.
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FY2023: USD 144M legacy legal settlement, plus USD 494M of non-cash charges on the cash election and repurchase of convertible notes and warrant unwinds. These items produced the FY2023 net loss.
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FY2025: USD (55)M after-tax loss from discontinued operations (HomeSafe).
Inflection: FY2024 marked the inflection to clean GAAP profitability. FY2025 delivered 18% growth in GAAP operating income despite only 1% revenue growth.
Balance sheet
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Balance-sheet values are from S&P Global via StockAnalysis, cross-checked to the FY2025 8-K for FY2024–FY2025.
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Company-defined net debt (gross debt before issuance costs, less cash) was USD 2,252M at FY2024 and USD 2,117M at FY2025. Company net leverage was 2.6x and 2.2x respectively.
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S&P total debt including leases was USD 2,899M at FY2025.
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FY2022 current maturities included USD 350M+ of convertible notes due 2023.
Commentary.
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Goodwill and intangibles (USD 3.4B) exceed shareholders' equity by more than 2x, so tangible book value is negative at ~USD (1.9)B. This is a direct consequence of the acquisition-led pivot into government services.
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Leverage stepped up in FY2024 with incremental term-loan borrowing (USD 574M) for LinQuest. It has since been reduced to 2.2x (FY2025), rising slightly to 2.3x in Q2 FY2026 on working-capital build and spin costs.
Cash flow
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FY2024–FY2025 OCF is from continuing operations. Including discontinued operations, OCF was USD 462M (FY2024) and USD 524M (FY2025) per S&P.
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Capex is from S&P / the 8-K.
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Buybacks: FY2022–FY2025 are derived from the change in balance-sheet treasury stock and include withholding. Reported cash share repurchases were USD 82M (FY2021), USD 218M (FY2024) and USD 329M (FY2025). FY2021 treasury stock change is not computed.
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Dividends paid in cash were USD 61M (FY2021), USD 79M (FY2024) and USD 84M (FY2025). FY2022 and FY2023 cash dividends are not reproduced here.
Commentary.
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Cash generation is structurally strong because the model is capital-light: capex is ~0.5% of revenue.
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FY2025 operating cash conversion of adjusted EPS was 110%.
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FY2023 OCF was depressed by the USD 144M legal settlement; adjusted OCF was USD 463M.
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H1 FY2026 OCF fell to USD 160M (from USD 308M) on contract-asset build, spin costs (USD 23M) and lower JV distributions. FY2026 guidance is USD 560–600M adjusted OCF.
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KBR returned USD 413M to shareholders in FY2025, a record.
Ratios
How the ratios are calculated:
ROE: net income attributable / average KBR equity. FY2021 uses year-end equity.
ROA: net income attributable / year-end total assets.
Debt to equity: total borrowings excluding leases / KBR equity.
Net debt to adjusted EBITDA: calculated on borrowings ex-leases. Company-reported net leverage was 2.6x (FY2024) and 2.2x (FY2025).
Asset turnover: revenue / year-end total assets.
Other ratios.
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Interest coverage (company-reported operating income / interest expense) was 4.6x in FY2024 (659/144) and 4.9x in FY2025 (778/158).
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S&P TTM metrics at Q2 FY2026: ROIC 10.2%, ROE 27.5%, interest coverage 3.8x (on S&P-standardized EBIT).
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The cash conversion cycle is not meaningful for a services contractor and is not disclosed. On a proxy basis, receivables plus contract assets of ~USD 1.37B against FY2025 revenue implies ~64 days sales outstanding.
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Effective Details
| Effective | Change |
|---|---|
FY2022 | Two core segments: Government Solutions (GS) and STS |
FY2025 (announced 7 Jan 2025) | GS renamed MTS; international government business re-integrated across MTS and STS; prior periods recast |
Q2 FY2025 | HomeSafe (MTS) moved to discontinued operations; FY2024 recast |
FY2026 | Pre-spin perimeter changes: Frazer-Nash Consultancy and the U.K. Civil Nuclear portfolio moved from MTS to STS; recast supplemental data posted on investors.kbr.com (full-year recast figures not reproduced in reviewed filings) |
Q1 FY2026 | Adjusted EBITDA definition revised prospectively to add back KBR's share of unconsolidated JV interest, tax, D&A and acquisition costs (~20 bps estimated FY2025 margin effect) |
Segment Revenue
| Segment | FY2024 | FY2025 |
|---|---|---|
Mission Technology Solutions revenue | 5,555 | 5,581 |
Sustainable Technology Solutions revenue | 2,155 | 2,205 |
Total revenue | 7,710 | 7,786 |
Segment Revenue (FY2022–FY2024)
| Segment | FY2022 | FY2023 | FY2024 |
|---|---|---|---|
Government Solutions revenue | 5,320 | 5,353 | 5,871 |
Sustainable Technology Solutions revenue | 1,244 | 1,603 | 1,871 |
Total revenue (incl. HomeSafe) | 6,564 | 6,956 | 7,742 |
Business Units
| Business unit | FY2024 | FY2025 |
|---|---|---|
Science & Space | 1,188 | 1,126 |
Defense & Intel (incl. international) | 2,887 | 3,178 |
Readiness & Sustainment | 1,480 | 1,277 |
MTS total | 5,555 | 5,581 |
Segment Revenue — MTS operating income
| Metric | FY2024 | FY2025 |
|---|---|---|
MTS operating income | 415 | 463 |
STS operating income | 405 | 477 |
Corporate operating loss | -161 | -162 |
Total operating income | 659 | 778 |
MTS adjusted EBITDA | 544 | 579 |
STS adjusted EBITDA | 439 | 497 |
Corporate adjusted EBITDA | -115 | -108 |
Total adjusted EBITDA | 868 | 968 |
Segment Margins & Growth (%) and Revenue by Segment (%)
| Metric | FY2024 | FY2025 |
|---|---|---|
MTS operating margin % | 7.5 | 8.3 |
STS operating margin % | 18.8 | 21.6 |
MTS adjusted EBITDA margin % | 9.8 | 10.4 |
STS adjusted EBITDA margin % | 20.4 | 22.5 |
MTS revenue YoY growth % | — | 0.5 |
STS revenue YoY growth % | — | 2.3 |
MTS share of revenue % | 72.0 | 71.7 |
STS share of revenue % | 28.0 | 28.3 |
Segment Margins & Growth (%)
| Metric | H1 FY2025 | H1 FY2026 |
|---|---|---|
MTS revenue | 2,717 | 2,604 |
STS revenue | 1,253 | 1,303 |
MTS operating income | 221 | 227 |
STS operating income | 252 | 216 |
MTS adjusted EBITDA | 275 | 296 |
STS adjusted EBITDA | 269 | 260 |
MTS adjusted EBITDA margin % | 10.1 | 11.4 |
STS adjusted EBITDA margin % | 21.5 | 20.0 |
Segment Revenue (FY2024–Q2 FY2026)
| Metric | FY2024 | FY2025 | Q2 FY2026 |
|---|---|---|---|
MTS backlog | 12,642 | 12,712 | 12,282 |
STS backlog | 3,963 | 4,152 | 5,523 |
Total backlog | 16,605 | 16,864 | 17,805 |
MTS backlog and options | 16,617 | 19,059 | 17,474 |
Total backlog and options | 20,580 | 23,211 | 22,997 |
Income Statement and Per-Share Data
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Revenue (USD Mn) | 7,339 | 6,564 | 6,956 | 7,710 | 7,786 |
Gross profit (USD Mn) | 806 | 828 | 977 | 1,099 | 1,150 |
Operating income, S&P standardized ex-equity earnings (USD Mn) | 399 | 404 | 479 | 552 | 568 |
Adjusted EBITDA, company non-GAAP (USD Mn) | 625 | 668 | 747 | 868 | 968 |
Pre-tax income (USD Mn) | 146 | 284 | -166 | 508 | 614 |
Net income attributable to KBR (USD Mn) | 27 | 190 | -265 | 375 | 415 |
Diluted EPS, attributable to KBR (USD) | 0.19 | 1.26 | -1.96 | 2.79 | 3.21 |
Dividends per share (USD) | 0.44 | 0.48 | 0.54 | 0.60 | 0.66 |
Income Statement and Per-Share Data (FY2022–FY2025)
| Metric | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|
Operating income, company reported (USD Mn) | 343 | 448 | 659 | 778 |
Adjusted EPS, company non-GAAP (USD) | 2.71 | 2.91 | 3.33 | 3.93 |
D&A (USD Mn) | — | — | 156 | 169 |
EBITDA = reported OI + D&A (USD Mn) | — | — | 815 | 947 |
Margin Analysis (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Gross margin % | 11.0 | 12.6 | 14.0 | 14.3 | 14.8 |
Operating margin % (S&P standardized) | 5.4 | 6.2 | 6.9 | 7.2 | 7.3 |
Adjusted EBITDA margin % | 8.5 | 10.2 | 10.7 | 11.3 | 12.4 |
Net margin % | 0.4 | 2.9 | -3.8 | 4.9 | 5.3 |
Balance Sheet
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Total assets (USD Mn) | 6,204 | 5,566 | 5,565 | 6,663 | 6,584 |
Cash and equivalents (USD Mn) | 370 | 389 | 304 | 342 | 500 |
Short-term debt / current maturities (USD Mn) | 26 | 364 | 31 | 36 | 49 |
Long-term debt (USD Mn) | 1,875 | 1,376 | 1,801 | 2,533 | 2,547 |
Total borrowings, ex-leases (USD Mn) | 1,901 | 1,740 | 1,832 | 2,569 | 2,596 |
Net debt, ex-leases (USD Mn) | 1,531 | 1,351 | 1,528 | 2,227 | 2,096 |
KBR shareholders' equity (USD Mn) | 1,669 | 1,620 | 1,383 | 1,453 | 1,503 |
Goodwill (USD Mn) | 2,060 | 2,087 | 2,109 | 2,630 | 2,677 |
Intangible assets (USD Mn) | 708 | 645 | 618 | 763 | 727 |
Working capital (USD Mn) | 277 | -74 | 79 | 91 | 363 |
Cash Flow
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Operating cash flow (USD Mn) | 278 | 396 | 331 | 450 | 557 |
Capital expenditure (USD Mn) | 30 | 71 | 62 | 52 | 42 |
Free cash flow = OCF − capex (USD Mn) | 248 | 325 | 269 | 398 | 515 |
Increase in treasury stock, derived proxy for buybacks (USD Mn) | — | 200 | 136 | 215 | 324 |
Returns & Leverage Ratios (%) and Financial Ratios (x)
| Ratio | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
ROE % | 1.6 | 11.6 | -17.6 | 26.5 | 28.1 |
ROA % | 0.4 | 3.4 | -4.8 | 5.6 | 6.3 |
Current ratio (x) | 1.15 | 0.96 | 1.05 | 1.05 | 1.22 |
Debt to equity (x) | 1.14 | 1.07 | 1.32 | 1.77 | 1.73 |
Net debt to adjusted EBITDA (x) | 2.45 | 2.02 | 2.05 | 2.57 | 2.17 |
Asset turnover (x) | 1.18 | 1.18 | 1.25 | 1.16 | 1.18 |
Revenue by Region
| Region | FY2022 | FY2023 | FY2024 |
|---|---|---|---|
United States (USD Mn) | 3,733 | 3,617 | 4,077 |
Middle East (USD Mn) | 406 | 528 | 731 |
Australia (USD Mn) | 437 | 496 | 526 |
U.K., Europe and rest of world, derived residual (USD Mn) | 1,988 | 2,315 | 2,408 |
Total (USD Mn) | 6,564 | 6,956 | 7,742 |
Revenue by Region (GS FY2024–STS FY2024)
| Region | GS FY2024 | STS FY2024 |
|---|---|---|
United States (USD Mn) | 3,535 | 542 |
Middle East (USD Mn) | 160 | 571 |
Australia (USD Mn) | 436 | 90 |
Revenue by Region (GS FY2022–STS FY2023)
| Region | GS FY2022 | STS FY2022 | GS FY2023 | STS FY2023 |
|---|---|---|---|---|
United States (USD Mn) | 3,264 | 469 | 3,096 | 521 |
Middle East (USD Mn) | 157 | 249 | 140 | 388 |
Australia (USD Mn) | 392 | 45 | 403 | 93 |
Geographic Revenue
| Region | FY2023 YoY % | FY2024 YoY % | FY2022–FY2024 CAGR % |
|---|---|---|---|
United States | -3.1 | 12.7 | 4.5 |
Middle East | 30.0 | 38.4 | 34.2 |
Australia | 13.5 | 6.0 | 9.7 |
Revenue by Region by Customer
| Customer | FY2022 | FY2023 | FY2024 |
|---|---|---|---|
U.S. government revenue (USD Mn) | 4,034 | 4,000 | 4,382 |
U.K. government revenue (USD Mn) | 584 | 634 | 674 |
Share Price and Per-Share Data
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Implied fiscal-year-end share price (USD) | 47.0 | 48.3 | 53.5 | 57.7 | 40.0 |
Dividend per share (USD) | 0.44 | 0.48 | 0.54 | 0.60 | 0.66 |
Year-end dividend yield % | 0.98 | 0.95 | 1.01 | 1.04 | 1.65 |
Change by Period
| Period | Change | Basis |
|---|---|---|
52-week | −26.9% | S&P |
~3-year (vs. FY2023 year-end implied ~USD 53.5) | ~−35% | Derived |
~5-year (vs. FY2021 year-end implied ~USD 47.0) | ~−27% | Derived; excludes dividends |
Valuation Multiples
| Multiple | KBR |
|---|---|
P/E (TTM GAAP) | 10.4x |
Forward P/E (adjusted) | 8.4x |
EV/Sales | 0.88x |
EV/EBITDA (S&P standardized EBITDA) | 10.1x |
EV/TTM adjusted EBITDA (USD 987M, company) | ~6.9x |
P/B | 2.66x |
P/FCF | 12.5x |
FCF yield | ~8.0% |
Valuation Snapshot
| Metric | Value |
|---|---|
Analysts | 8 (S&P Global) |
Consensus rating | Buy (4 Strong Buy / 4 Hold, Aug 2026) |
Average price target | USD 44.29–45.71 (low USD 35, high USD 60); ~28% upside |
FY2026 consensus revenue | ~USD 8.06B |
FY2026 consensus adjusted EPS | ~USD 3.99 |
FY2027 consensus | Revenue ~USD 8.51B; adjusted EPS ~USD 4.06 (pre-spin, consolidated basis) |
Per-Share Data and Margin Analysis (%)
| Metric | FY2021 | FY2022 | FY2023 | FY2024 | FY2025 |
|---|---|---|---|---|---|
Annual dividend per share (USD) | 0.44 | 0.48 | 0.54 | 0.60 | 0.66 |
Dividend growth % | 10.0 | 9.1 | 12.5 | 11.1 | 10.0 |
Capital Markets
| Item | Detail |
|---|---|
Senior credit facility | Revolver (USD 1.0B committed) with term loans. USD 625M undrawn revolver capacity at 3 Jul 2026. Incremental term borrowing of USD 574M in FY2024 for LinQuest |
Senior notes | USD 250M 4.75% senior notes due 2028 (issued Sept 2020) |
Gross debt | Long-term debt USD 2,503M + current maturities USD 49M (3 Jul 2026) |
Net debt / net leverage | USD 2,258M / 2.3x TTM adjusted EBITDA (3 Jul 2026) |
Liquidity | ~USD 0.9B (USD 312M cash + USD 625M revolver), 3 Jul 2026 |
Credit ratings | KBR is understood to carry sub-investment-grade (BB-category) corporate ratings from Moody's and S&P. |
Capital Instruments
| Instrument | Amount |
|---|---|
Current maturities, next 12 months | 49 |
4.75% notes due 2028 | 250 |
Analyst Conclusions
Management guidance and consensus
FY2026 guidance (reaffirmed 30 Jul 2026): revenue USD 7.90–8.36B; adjusted EBITDA USD 980–1,040M; adjusted EPS USD 3.87–4.22; adjusted OCF USD 560–600M.
Phasing: guidance implies 54% in H2. H1 FY2026 delivered revenue of USD 3.91B (48% of the USD 8.13B midpoint) and adjusted EBITDA of USD 509M (50% of the midpoint).
Consensus (Aug 2026): FY2026 revenue ~USD 8.06B (+3.5%); adjusted EPS ~USD 3.99 (+1.6%). Three-year revenue growth forecast ~4.6% p.a. (S&P).
Bull case
-
Sum-of-the-parts re-rating. STS generated ~USD 500M of FY2025 adjusted EBITDA at a 22.5% margin with a record USD 5.5B backlog. As a stand-alone process-technology company it could command a premium multiple. The whole group trades at ~6.9x TTM adjusted EBITDA.
-
Protest conversion. ~USD 10.6B of awarded MTS work is outside backlog. GAO rejected Battelle's spin-related arguments and most other claims; only a narrow past-performance issue was sustained. Favorable re-evaluations (ASESC, State Department Iraq) would materially lift Trinzic's visibility.
-
Cash and capital returns. Capex runs at ~0.5% of revenue, FY2025 OCF conversion was 110%, and the FCF yield is ~8%. Together with a shrinking share count, this supports per-share compounding even at low-single-digit revenue growth.
Bear case
-
Growth stall in MTS. H1 FY2026 MTS revenue fell 4%. Federal civilian budgets are pressured, EUCOM contingency is rolling off and HomeSafe is gone, leaving Trinzic as a low-growth, ~10–12% margin government-services company in a crowded peer set.
-
Spin execution and leverage. USD 46M of H1 spin charges have already been taken. Tax-free status depends on IRS/legal opinions. Allocating ~USD 2.3B of net debt between two smaller companies may leave one or both with constrained ratings and dividend capacity. Negative tangible equity limits flexibility.
-
STS cyclicality. Q4 FY2025 showed petrochemical capex cuts and green-project pauses. Q2 FY2026 STS operating income fell 18% on mix. SAF, e-fuels and green ammonia projects remain policy- and financing-dependent, so licensing wins may not convert to revenue on schedule.
Catalysts and monitorables (next 12 months)
| Timing | Catalyst |
|---|---|
| 29 Oct 2026 | Q3 FY2026 results; H2 delivery versus 54% phasing; possible standalone outlooks |
| Q4 2026 | Form 10 effectiveness; Trinzic capital structure; investor day(s); IRS ruling; Board approval of distribution |
| Q4 2026 – H1 2027 | NSF ASESC re-evaluation outcome; NASA COSMOS re-decision; State Department Iraq protest |
| 4 Jan 2027 | Target spin completion; Trinzic listing |
| Early 2027 | FY2026 results; first standalone guidance for New KBR and Trinzic; dividend policy for each company |
| Ongoing | FY2027 U.S. appropriations/continuing-resolution path; Golden Dome task orders under SHIELD; STS FIDs in ammonia, LNG and SAF; Middle East security |
Concluding analyst verdict
KBR enters the final quarter before its separation as a company whose operating quality has outrun its share price.
Over FY2021–FY2025 management improved the business materially:
-
adjusted EBITDA margin rose by roughly 390 bps to 12.4%;
-
operating cash conversion exceeded 100%;
-
share count fell by ~10%;
-
the legacy liabilities that defined the old Kellogg Brown & Root were cleared: Ichthys, the convertible notes and a long tail of litigation.
STS in particular has become a genuinely differentiated, IP-anchored franchise. It earns more than 20% EBITDA margins, has a record backlog and growing recurring streams (catalysts, maintenance, BRIS/SWAT).
The market, however, has focused on the top line, which is not growing. The MTS revenue base has been eroded by several shocks:
-
the HomeSafe termination;
-
EUCOM contingency run-off;
-
federal civilian funding pressure;
-
an unusually large USD 10.6B protest overhang.
The partial GAO sustain on the USD 8B Antarctic contract is a reminder that even won work is not banked. At ~USD 34.50 the stock trades at roughly 8–9x forward adjusted EPS and under 7x TTM adjusted EBITDA. That price implies scepticism about both growth and spin value.
Our synthesis is that the risk/reward is constructive but catalyst-dependent. The investment case rests on three things:
-
a clean, tax-free separation on 4 January 2027 with sensible leverage allocation;
-
conversion of protested awards into Trinzic backlog;
-
STS's ability to turn licensing wins into sustained mid-teens growth.
If those materialize, a sum-of-the-parts re-rating toward the ~USD 44–46 consensus target is plausible. If the separation slips, leverage is unevenly allocated or protests go against KBR, the low multiple could persist.
Key monitorables are the Q3 FY2026 print (29 October), the Form 10 capital structure and the NSF re-evaluation. On balance we view KBR as a "show-me" special situation with asymmetric upside skewed to STS.
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View Subscription PlansExecutive Leadership
Executive Leadership Team
| Name | Title | Tenure / background |
|---|---|---|
Stuart J. B. Bradie (59) | Chair, President & CEO | CEO since 2 Jun 2014; Chair since May 2025; post-spin Chair/President/CEO of New KBR. Ex-WorleyParsons (Group MD Operations & Delivery; MD Europe, Africa, Asia & Middle East); Kvaerner. MBA (Heriot-Watt); BSc Mech. Eng. (Aberdeen). Director, Rolls-Royce Holdings plc (since 2023) |
Shad E. Evans | EVP & CFO | CFO effective 5 Jan 2026. Previously SVP Financial Operations (2025), SVP & CFO of STS (May 2024), SVP Finance Operations & Chief Accounting Officer (Oct 2020); joined KBR Sept 2018 as CFO Technology Solutions |
Mark W. Sopp | EVP, Strategic Transactions | CFO until Jan 2026; now leads the MTS spin execution; slated to be New KBR CFO post-spin (per IR spin page) |
J. Jay Ibrahim | President, Sustainable Technology Solutions | President STS since June 2020 |
Jay Lennon | President, Mission Technology Solutions | Cited as MTS President in August 2026 award release |
Sonia Galindo | EVP, General Counsel & Corporate Secretary | Per 2026 proxy |
Jennifer Myles | EVP & Chief People Officer | U.K.-based; 2025 base salary GBP 431,985 (2026 proxy) |
Gregory Conlon | EVP & Chief Digital & Development Officer | Ex-WorleyParsons |
Byron Bright | Former COO | Appointed COO effective May 2025; employment terminated before FY2025 year-end (2026 proxy) |
Michael LaRouche | President & CEO-designate, Trinzic | 25 Jun 2026 |
Nicholas Veasey | EVP & CFO-designate, Trinzic | 25 Jun 2026 |
Directors' Remuneration
| Executive | Total compensation (USD) |
|---|---|
Stuart Bradie, CEO | ~11.61M (11.3% salary / 88.7% incentive and equity) |
Other NEOs | ~2.15M–3.41M range |
Board of Directors
| Director | Age | Since | Independent | Committees | Principal occupation |
|---|---|---|---|---|---|
Stuart Bradie | 59 | 2014 | No | — | Chair, President & CEO, KBR |
Lt. Gen. Wendy Masiello (Ret.) | 67 | 2017 | Yes; Lead Independent Director since 2025 | Compensation; Sustainability, Technology & Cybersecurity | Ex-Director, DCMA; StandardAero director |
Joseph Dominguez | 63 | 2024 | Yes | Compensation | President & CEO, Constellation Energy |
Lynn Dugle | 66 | 2020 | Yes | Compensation; Nominating & Corporate Governance (Chair) | Ex-Chair/CEO, Engility; Micron, TE Connectivity, EOG boards |
Nchacha Etta | 55 | 2024 | Yes | Audit (financial expert); Sustainability, Technology & Cybersecurity | Ex-EVP & CFO, Omnicell |
Sir John Manzoni KCB | 66 | 2022 | Yes | Audit (financial expert); Sustainability, Technology & Cybersecurity | Ex-Permanent Secretary, U.K. Cabinet Office; Chair of Diageo and SSE |
Jack Moore | 72 | 2012 | Yes | Compensation (Chair); Nominating & Corporate Governance | Ex-Chair/CEO, Cameron; Chair, Occidental |
Ann Pickard | 70 | 2015 | Yes | Compensation; Sustainability, Technology & Cybersecurity (Chair) | Ex-EVP Arctic, Shell; Woodside director |
Carlos Sabater | 67 | 2021 | Yes | Audit (Chair; financial expert); Nominating & Corporate Governance | Ex-Senior Global Partner, Deloitte; Pool Corp director |
Huibert Vigeveno | 56 | 2025 | Yes | Nominating & Corporate Governance; Sustainability, Technology & Cybersecurity | Group CEO, MET Group; ex-Shell Downstream Director |
Lewis Von Thaer | 65 | 2025 | Yes | Audit; Nominating & Corporate Governance | President & CEO, Battelle Memorial Institute; AEP director |
Rami Qasem | 59 | Oct 2026 | Presumed independent | Not yet disclosed | Ex-CEO Digital Solutions, Baker Hughes; ex-GE MENA & Turkey CEO |
Major Shareholders
| Holder | Shares (M) | % outstanding | Source / date |
|---|---|---|---|
FMR LLC (Fidelity) | ~19.0 | ~15.1 | Simply Wall St (13F) |
BlackRock, Inc. | ~13.5 | ~10.7 | 13F Q1 2026 |
Vanguard (Portfolio Mgmt + Capital Mgmt + Fiduciary Trust) | ~12.6 | ~10.0 | 13F Q1 2026; Vanguard Capital Management 13G 5.23% (Apr 2026) |
Invesco | ~4.8–5.5 | ~3.8–4.3 | 13F; sources vary |
State Street Global Advisors | ~4.0 | ~3.1 | 13F |
Dimensional Fund Advisors | ~2.8 | ~2.2 | 13F |
Franklin Resources | ~2.7 | ~2.1 | 13F |
Massachusetts Financial Services | ~2.6 | ~2.1 | 13F |
Neuberger Berman | — | ~2.1 | 13F |
Permian Investment Partners / D.E. Shaw / Snyder Capital | ~2.3 each | ~1.7–1.8 | 13F (earlier period) |
Competitive Landscape
Key Competitors
| Company | Latest FY revenue (USD Bn, approx.) | FY | Relative positioning vs KBR |
|---|---|---|---|
KBR | 7.8 | FY2025 | Hybrid: government services plus process IP |
Leidos | ~16.7 | FY2024 | ~2x KBR; broader IT/health/defense; peer adjusted EBITDA margin ~13% |
Booz Allen Hamilton | ~12.0 | FY2025 (Mar) | Consulting/analytics-heavy; civil exposure similar headwind |
CACI | ~8.6 | FY2025 (Jun) | Comparable size; more tech/expertise IP |
SAIC | ~7.5 | FY2025 (Jan) | Comparable size; lower margin |
Parsons | ~6.8 | FY2024 | Defense/intel plus critical infrastructure |
V2X | ~4.3 | FY2024 | Readiness/logistics; overlaps R&S |
Fluor | ~16.3 | FY2024 | Engineering & construction; more lump-sum risk than KBR STS |
Technip Energies | ~EUR 6.9 | FY2024 | LNG, ammonia, process tech; closest STS peer |
Worley | ~AUD 11.8 | FY2024 (Jun) | Engineering services; energy transition |
Competitor Detail
| Metric | KBR FY2025 |
|---|---|
Revenue growth % | 1 |
Adjusted EBITDA margin % | 12.4 |
