Shaw Group Posts 3Q Profit

NEW ORLEANS — Shaw Group Inc., an engineering and construction services provider, posted a third-quarter profit on Wednesday, citing strong demand for power generation capacity and petrochemicals processing.

The results beat Wall Street expectations, and Shaw Group shares rose more than 8 percent in afternoon trading.

The company earned $54.6 million, or 67 cents per share, in the three months ended May 31 versus a loss of $16.7 million, or 21 cents per share, posted in the prior-year quarter.

The results include $5.7 million, or 7 cents a share, from the company's acquisition a year ago of 20 percent interest in Westinghouse Electric, a service provider for nuclear plants.

Revenue increased to $1.6 billion from $1.2 billion in the third quarter of 2006.

Analysts polled by Thomson Financial expected earnings per share of 40 cents before one-time items on revenue of $1.55 billion.

Shaw shares rose $4.18, or 6.9 percent, to close at $65 Wednesday after rising to a 52-week high of $68.69 earlier in the session.

Revenue in all but one of Shaw Group's divisions grew. In the case of its biggest business, its fossil and nuclear division, it more than doubled.

The company attributed the 26 percent decline in revenue in its second-largest division, its environmental and infrastructure group, to results in the prior-year quarter swollen by "significant" amounts of disaster relief and emergency response services due to the Gulf Coast hurricanes.

"Our operating segments are well positioned to benefit from this continued global economic expansion, and we continue to believe there will be significant long-term growth in the development nuclear power markets," Shaw Group President, Chief Executive and Chairman J.M. Bernhard Jr. said in a statement.

The company said it had a backlog of unfilled orders of $13.3 billion, up from about $8 billion in the 2006 period. The company expected about $5.6 billion of that backlog to turn to revenue over the next year. It also expected the backlog to grow from the end of the third quarter through the end of its fiscal year, to $14.3 billion.

"Our record backlog positions us well for fiscal 2008, and we believe the global markets we serve will remain strong throughout the year," Bernhard said.

Shaw Group, which employs about 25,000 people, sees nuclear energy as a growth area with strong potential in the coming years in the Southeast, spokesman Sean Clancy said.

"The nation as a whole is undergoing a nuclear renaissance right now," with nuclear a cleaner, lower-cost source of energy, he said.

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http://www.shawgrp.com/

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