Strong oil, gas revenue boosts McDermott 3Q profit

McDermott International posts better-than-expected 3rd-qtr results on Middle East oil projects

• On 7:22 am EST, Tuesday November 10, 2009

HOUSTON (AP) -- McDermott International Inc., which provides engineering and construction services for utilities and oil and gas producers, said its third-quarter profit jumped on strong revenue from oil and gas projects in the Middle East.

"We are delighted that the challenging Middle East pipelines are now complete," said CEO John A. Fees, in a statement after the markets closed Monday.

"As we expected, bookings were light, however the bidding activity remained at a high level while the company's liquidity and balance sheet continued to improve," he said.

Profit for the three months ended Sept. 30 rose to $118.1 million, or 50 cents per share, from $85.6 million, or 37 cents per share, a year earlier.

Revenue climbed to almost $1.68 billion from $1.66 billion, as results surged 26 percent in its offshore oil and gas construction segment and jumped 17 percent in its government operations division. Those increases offset lower revenue in its power generation systems segment linked to less activity on major capital projects such as new power plant construction and retrofits of existing power plants.

The results easily topped analysts' consensus estimates for profit of 40 cents per share and revenue of $1.54 billion, according to Thomson Reuters.

At the end of the quarter, McDermott's consolidated backlog totaled $8.5 billion, down from $9.4 billion in the year-ago period and $9.5 billion at the end of the 2009 second quarter.

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