-=McDermott (MDR) reported earnings on Tue 30 Oct 2018 (a/h)

McDermott misses by $0.09, misses on revs; guides 2H2018 revenue; to divest storage tank, U.S. pipe fabrication businesses

Reports Q3 (Sep) earnings of $0.20 per share, excluding non-recurring items, $0.09 worse thanthe S&P Capital IQ Consensus of $0.29; revenues rose 138.7% year/year to $2.29 bln vs the $2.5 bln S&P Capital IQ Consensus.

Issues 2H2018 guidance for revenue between $4.8-5.1 billion, operating margins of 4.2-4.5%, diluted net income of ($0.06)-($0.11), EBITDA of $375-415 million.

Also announced the completion of its comprehensive strategic review of its portfolio. As a result of the review, McDermott has determined that its storage tank business and its U.S. pipe fabrication business are not core to the company's long-term strategic objectives as a vertically integrated supplier with strong pull-through from technology. In particular, McDermott has determined that these operations offer limited pull-through or cross-selling opportunities and, in some cases, their ability to pursue third-party work aggressively can be hampered by internal considerations. As a result, McDermott is developing plans to seek buyers for each of the two businesses.