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shaw group 656631FE-D4E6-4F14-A3DB-B8C5E6B7BB07_1Q2009
1. The Shaw Group Inc.
First Quarter FY 2009:
Earnings Conference Call
Thursday, January 8, 2009
J.M. Bernhard Jr.
Chairman, President & Chief Executive Officer
Brian K. Ferraioli
85M102006D
Executive Vice President & Chief Financial Officer
2. Forward Looking Statements &
Regulation G Disclosure
This presentation contains forward-looking information and statements within the
meaning of the Private Securities Litigation Act of 1995. The words “believe,” “expect,”
“anticipate,” “plan,” “intend,” “foresee,” “should,” “would,” “could,” or other similar
expressions are intended to identify forward-looking statements, which are generally not
historical in nature. These forward-looking statements are based on our current
expectations and beliefs concerning future developments and their effect on us.
However, the absence of these words does not mean that the statements are not
forward-looking. Our forward-looking statements involve significant risks and
uncertainties, some of which are beyond our control and actual results may differ
materially from those expressed or implied by forward-looking statements as a result of
many factors or events, including current economic conditions and resulting capital
constraints, as well as the factors we discuss or refer to in the “Risk Factors” section of
our most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and
Current Reports on Form 8-K filed with the Securities and Exchange Commission (SEC)
and on our website under the heading “Forward-Looking Statements.”
This presentation contains non-GAAP measures as defined by the SEC rules and
regulations. A reconciliation of these measures to the most directly comparable GAAP
measures is included in the attached appendix and on our Web site at
02M102007D
www.shawgrp.com in the Investor Relations section under “Regulation G Disclosures.”
2
3. Q-1 FY 2009: Executive Summary
• Very strong quarter from operations: Record revenue
and EBITDA (excluding Westinghouse)
• $161M non-cash foreign exchange translation loss on
Westinghouse yen bonds, as Yen continued to
appreciate vs. the Dollar
• Subsequent to quarter end, signed nuclear EPC
contract with Progress Energy Florida, the largest
contract in our history
02M102007D
3
5. Q-1 FY 2009: Quarter in Summary
Record Q-1 FY 2009 Q-1 FY 2008
(in millions, except per As Reported Westinghouse Actuals Actuals
share data) Segment Excluding Excluding
Westinghouse* Westinghouse*
Revenue $ 1,900.4 $ 0.0 $ 1,900.4 $ 1,712.2
Gross Profit 188.1 0.0 188.1 135.0
GP% 9.9% N/A 9.9% 7.9%
EBITDA* (37.5) (158.7) 121.2 78.6
EBITDA % (2.0)% N/A 6.4% 4.6%
Net Income (39.9) (102.7) 62.8 37.7
Diluted EPS (0.48) (1.23) 0.75 0.45
Operating Cash Flow (98.9) (14.7) (84.2) 121.7
New Awards 1,131.7 N/A 1,131.7 1,363.6
•• Earnings continue to be led by E&C, Fossil, and F&M contracts, but E&I also had a strong quarter
Earnings continue to be led by E&C, Fossil, and F&M contracts, but E&I also had a strong quarter
•• Yen/Dollar FX rate continues to decline (95 at quarter end vs. 109 at end of FY08) resulting in a
Yen/Dollar FX rate continues to decline (95 at quarter end vs. 109 at end of FY08) resulting in a
$161M non-cash pre-tax loss
$161M non-cash pre-tax loss
•• Cash flow is project timing related, after a very strong Q-4 FY08 (generated $286M)
Cash flow is project timing related, after a very strong Q-4 FY08 (generated $286M)
•• Q-2 and the balance of FY09 are forecast to be cash positive; previous guidance of $250M-$300M
02M102007D
Q-2 and the balance of FY09 are forecast to be cash positive; previous guidance of $250M-$300M
of operating cash flow remains unchanged
of operating cash flow remains unchanged
*See Appendices for a reconciliation to the corresponding GAAP measure.
5
6. Q-1 FY 2009: Segment Analysis
Record Revenue Gross Profit Gross Profit %
(in millions) Q-1 FY 2009 Q-1 FY 2008 Q-1 FY 2009 Q-1 FY 2008 Q-1 FY 2009 Q-1 FY 2008
Fossil & Nuclear $ 676.6 598.5 $ 51.8 $ 42.9 7.7% 7.2%
E&C1* 218.6 161.7 52.4 16.4 24.0% 10.1%
Maintenance 334.1 290.4 11.7 14.8 3.5% 5.1%
E&I2* 401.4 365.8 34.5 25.1 8.6% 6.9%
F&M 164.7 136.6 35.7 35.1 21.7% 25.7%
Corporate 1.9 0.7 2.0 0.7 N/M N/M
$ 1,797.3 $ 1,553.7 $ 188.1 $ 135.0 10.5% 8.7%
Fossil & Nuclear: Continues to be driven by fossil contracts (new build and air emissions)
Fossil & Nuclear: Continues to be driven by fossil contracts (new build and air emissions)
E&C: Increased volume and margins vs. prior year; Q-1 FY09 includes cost reduction estimates on
E&C: Increased volume and margins vs. prior year; Q-1 FY09 includes cost reduction estimates on
several projects
several projects
Maintenance: Revenues improved with higher volumes, but margins less than prior year due to
Maintenance: Revenues improved with higher volumes, but margins less than prior year due to
execution of higher-margin construction projects in FY08
execution of higher-margin construction projects in FY08
E&I: Continued improvement in execution; Q-1 FY09 revenues reflect some hurricane emergency
E&I: Continued improvement in execution; Q-1 FY09 revenues reflect some hurricane emergency
response work
response work
F&M: Continued solid performance; Q-1 FY09 reduction in gross profit reflects change in product mix
F&M: Continued solid performance; Q-1 FY09 reduction in gross profit reflects change in product mix
and some costs associated with Mexico facility and development of modular facility
and some costs associated with Mexico facility and development of modular facility
02M102007D
1E&C revenues presented excluding pass through costs of $103.1M and $134.4M for Q-1 FY2009 and Q-1 FY2008, respectively.
2E&Irevenues presented net of previously consolidated military privatization joint venture revenues of $24.1M for Q-1 FY08 (no longer applicable in Q-1 FY09).
*See Appendices for a reconciliation to the corresponding GAAP measure.
6
7. Foreign Exchange Impact on
Investment in Westinghouse
Yen Denominated Bonds & Put Option
($ equivalent in millions, except exchange rate data)
Date of GAAP
Investment Treatment
11/30/2008 Change
Yen/Dollar Exchange Rate 119.43 95.48 23.95
Yen Denominated Bonds RECORDED
$ 1,080 $ 1,351 $ (271)
Yen Denominated Put Option UNRECORDED
1,044 1,306 262
Principal Exposure $ 36 $ 45 $ (9)
•• If Shaw were to exercise the Put, the net exposure would be approximately $45M, which has
If Shaw were to exercise the Put, the net exposure would be approximately $45M, which has
changed $9M from the exposure at the original investment date.
changed $9M from the exposure at the original investment date.
•• Q-1 FY09 FX loss totaled $161.2M pre-tax ($98.2M after-tax).
Q-1 FY09 FX loss totaled $161.2M pre-tax ($98.2M after-tax).
•• FY09 YTD FX loss would approximate $185M pre-tax (at 93.8 Yen // U.S. dollar).
FY09 YTD FX loss would approximate $185M pre-tax (at 93.8 Yen U.S. dollar).
•• Dividends are based on the U.S. GAAP Net Income of Westinghouse; target distribution during
Dividends are based on the U.S. GAAP Net Income of Westinghouse; target distribution during
the put period is $24M per year for Shaw (dividend rights continue for put period even if not
the put period is $24M per year for Shaw (dividend rights continue for put period even if not
paid during period of Shaw ownership).
paid during period of Shaw ownership).
02M102007D
•• Received $32M in dividends through 12/31/08 ($29M in Q-2 FY09) vs. $48M 2-year target.
Received $32M in dividends through 12/31/08 ($29M in Q-2 FY09) vs. $48M 2-year target.
7
8. Q-1 FY 2009: Cash and Debt
937
($ in millions)
831
Cash
Debt
688
663
482
361
218
178 165
107
86
28 28
17 18 10 8
13
Q-1 FY07 Q-2 FY07 Q-3 FY07 Q-4 FY07 Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09
Trailing Twelve Months Operating Cash Flow: $416M
Trailing Twelve Months Operating Cash Flow: $416M
02M102007D
Notes:
1. Cash balance represents the sum of cash, cash equivalents and restricted cash.
2. Total debt excludes Japanese Yen-denominated bonds secured by Investment in Westinghouse. See Appendices for a
reconciliation to the corresponding GAAP measure.
8
10. Business Segments
Power: Power: Energy & Fabrication & Environmental &
Fossil & Nuclear Maintenance Chemicals Manufacturing Infrastructure
The Shaw Group Inc. is a full service provider of engineering, design, technology, procurement,
construction, maintenance, fabrication, manufacturing, consulting and facilities management
services for private sector and government clients in the energy, chemicals, environmental,
infrastructure and emergency response markets.
02M102007D
10
11. Stable Customer Base in Uncertain Times
Shaw’s $14.8B Backlog at
11/30/08 is Comprised of 3 Major • Regulated Utilities
Customer Classes – Solid balance sheets backed by the
ability to recover costs through the
National or regulatory process; capital projects are
International Oil long-term (multi-decade) investments not
Companies: subject to short-term economics
14%
• U.S. Government
– Spending expected to remain strong with
potential stimulus package; focus likely
Regulated to remain on economy, military
Utilities: transformation, terrorism, and
Other: 35% infrastructure improvements
18%
• National or International Oil Companies
– Large amounts of cash on hand; long-
U.S.
term investment horizon; government
Government:
backing
33%
Approximately 82%, or $12B, of backlog is comprised of regulated utilities,
Approximately 82%, or $12B, of backlog is comprised of regulated utilities,
national or international oil companies, and the U.S. Government, who provide
national or international oil companies, and the U.S. Government, who provide
financial strength and stability, are expected to continue capital investments, and
financial strength and stability, are expected to continue capital investments, and
02M102007D
who should reduce the risk of project delays, payment defaults, or cancellations.
who should reduce the risk of project delays, payment defaults, or cancellations.
11
12. Market Overview: Power
• Fossil projects in backlog continue to be executed
as planned
• Domestic scrubber market continues to be strong;
expect significant bookings in 2009
• Domestic nuclear market appears to be
accelerating; signed largest contract in our history
with Progress Energy Florida
• International nuclear market for AP1000™
developing
• Interest in domestic gas fired and geothermal
projects increasing
• Maintenance market continues to be steady;
nuclear uprate activity expected to increase
02M102007D
12
13. Major Power Market Opportunities
Europe
China
Indonesia &
Philippines
Brazil
India
United States
South Africa
Australia &
New Zealand
02M102007D
IEA forecasts $5.2 trillion in global power
IEA forecasts $5.2 trillion in global power
generation investment from 2005-2030
generation investment from 2005-2030
13
14. Nuclear Renaissance First Movers
Alternate Energy
PPL Generation
Holdings Unistar Susquehanna
Bruneau Nine Mile
Detroit Edison
Fermi
Unistar
Exelon Calvert Cliffs
Clinton
AmerenUE
Callaway Dominion
North Anna
Progress Energy
Harris
Unistar Duke
Amarillo TVA William Lee
Bellefonte
Entergy
Grand Gulf
Luminant
Comanche Peak
AP1000™ SCE&G
V.C. Summer
EPR Entergy
River Bend
ESBWR
Progress Energy Southern
ABWR Exelon Levy County Vogtle
Victoria County
APWR NRG Entergy
02M102007D
South Texas
FP&L
To Be Determined
Turkey Point
14
15. Market Overview: Energy & Chemicals
• Projects in backlog continue to be executed as
planned
• No significant changes at this time to our 2009
sales prospects
• If global economy / price of oil remain depressed,
clients likely to focus on higher margin technology
and consulting services – a Shaw strength
02M102007D
15
16. Market Overview: Environmental &
Infrastructure
• 93% of existing backlog is with the U.S.
Federal Government
• Projects in backlog continue to be
executed as planned
• Segment well-positioned for potential U.S.
Federal stimulus plan (e.g., incremental
levee, coastal restoration, environmental
remediation, infrastructure projects),
although not assumed in our 2009
financial forecast
02M102007D
16
17. Consolidated Backlog and Backlog Conversion
(as of 11/30/08)
Backlog by Business Segment Expected Backlog Conversion
($ in billions)
Consolidated
Next
Fabrication & Manufacturing $15.6
$14.8 12 months
$14.3
Energy & Chemicals
$0.8
41%
$0.7
Environmental & Infrastructure $0.7
$2.2
$6.0B
$2.0
Maintenance
$2.6
Fossil & Nuclear
$3.7B
$9.1 $5.1
$2.6
$5.1B
$5.0
$0.4
$1.4
$6.7 $1.7
$5.8 13-24 months
$1.4
$1.3
$4.8 25%
$2.8
Greater than
24 months
$1.3 $6.7
34%
$6.1 $5.8
$3.2
FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 Q-1 FY
2009
Backlog excludes majority of domestic nuclear work expected to be performed under signed
Backlog excludes majority of domestic nuclear work expected to be performed under signed
02M102007D
EPC contracts (Georgia Power, SCE&G, and Progress Energy Florida)
EPC contracts (Georgia Power, SCE&G, and Progress Energy Florida)
17
18. Fossil and Nuclear Projects Present Significant Upside
To Current Backlog
Backlog + Projects Where Shaw Has Been Selected But Work Has Not Been Released
$36.8
($ in billions)
Consolidated
Fabrication & Manufacturing RWE npower
Energy & Chemicals
Environmental & Infrastructure
Maintenance
Fossil & Nuclear
3 Signed Nuclear
Fossil & Nuclear – selected but $13
EPC Contracts
projects not in backlog
$15.6
$14.3
Current
$0.7
Backlog - $14.8
$2.0
$9.1
$5.0
$6.7
$5.8
$4.8
$1.3
$5.8
02M102007D
FY 2003 FY 2004 FY 2005 FY 2006 FY 2007 FY 2008 Q-1 FY09
Full Spectrum of Shaw’s Workload Approaching $37B
Full Spectrum of Shaw’s Workload Approaching $37B
18
19. Fossil & Nuclear
Q-1 FY09 in Summary Q-1 2009 New Awards: $489M
• Earnings for the quarter driven • Approx. $400M EPC contract
by Fossil contracts (primarily with NV Energy for combined
new build coal and air cycle gas power plant near
emissions projects) Las Vegas
• Nuclear projects expected to
begin having more significant
earnings impact in FY 2010
Backlog EBITDA*
($ in billions) ($ in millions)
41.7
6.9
6.6 6.7 39.6
6.1 35.8
5.8
27.0
20.5
Fossil & Nuclear
Backlog:
Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09
$5.8 billion Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09
EBITDA from nuclear division forecast to approximate $10M in
EBITDA from nuclear division forecast to approximate $10M in
FY 2009, $75M in FY 2010, and $125M in FY 2011
FY 2009, $75M in FY 2010, and $125M in FY 2011
39%
(excludes F&M’s earnings from fabrication activities and modular
(excludes F&M’s earnings from fabrication activities and modular
02M102007D
components, as well as earnings from Investment in Westinghouse)
components, as well as earnings from Investment in Westinghouse)
Total Shaw Backlog: $14.8 billion
*See Appendices for a reconciliation to the corresponding GAAP measure.
19
20. Maintenance
Q-1 2009 New Awards: $184M
Q-1 FY09 in Summary
• Majority of Q-1 new awards
• Steady, consistent performance
from smaller contracts
during Fall outage season
• Fewer higher margin
construction projects in Q-1
FY09 as compared to 08
Backlog EBITDA*
($ in millions)
($ in billions)
15.2
1.6
1.5 1.5 1.4 11.9
1.3
10.2
9.0
Maintenance Backlog: (0.5)
$1.3 billion
Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09
Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09
9%
Maintenance contracts for 41 of the 104 existing nuclear
Maintenance contracts for 41 of the 104 existing nuclear
reactors in the U.S., including fleet-wide services on the 2
reactors in the U.S., including fleet-wide services on the 2
largest U.S. fleets
largest U.S. fleets
02M102007D
Total Shaw Backlog: $14.8 billion
*See Appendices for a reconciliation to the corresponding GAAP measure.
20
21. Energy & Chemicals
Q-1 FY09 in Summary Q-1 2009 New Awards: $166M
• Increase in volume and • Majority of Q-1 new awards
margins drove another strong driven by scope increases on
quarter existing projects
• Strong operational • Engineering and design work
performance and reduced cost for multi-national petrochemical
estimates on several projects client
helped drive quarterly earnings
Backlog EBITDA*
Record
($ in billions) ($ in millions)
41.6
39.8
33.6
2.3
2.3 2.2 2.2
2.0
E&C Backlog: 13.2
9.4
$2.0 billion
14% Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09 Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09
Major prospects internally authorized by clients
Major prospects internally authorized by clients
02M102007D
appear to be proceeding as planned
appear to be proceeding as planned
Total Shaw Backlog: $14.8 billion
*See Appendices for a reconciliation to the corresponding GAAP measure.
21
22. Fabrication & Manufacturing
Q-1 FY09 in Summary Q-1 2009 New Awards: $77M
• Continued strong operational • Majority of Q-1 new awards
performance driven by scope increases on
existing projects
• Projects in backlog continue
as planned
EBITDA*
Backlog
($ in millions)
($ in billions) 39.4
31.8
31.8
0.8
0.7 0.7 28.2
0.7 0.7 27.1
F&M Backlog:
$0.7 billion
5%
Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09
Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09
Progress continues on new nuclear module fabrication and
Progress continues on new nuclear module fabrication and
assembly plant in Lake Charles, LA
assembly plant in Lake Charles, LA
02M102007D
Total Shaw Backlog: $14.8 billion
*See Appendices for a reconciliation to the corresponding GAAP measure.
22
23. Module Fabrication and Assembly Facility
• Work has commenced on the $100 million / 600,000 square foot
facility located in Lake Charles, LA
• Will produce structural, piping and equipment modules for new
nuclear power plants utilizing the Westinghouse AP1000™
technology
• Shaw’s 3 existing nuclear EPC contracts are expected to generate
approx. $1B in revenues for this facility
02M102007D
23
24. Environmental & Infrastructure
Q-1 FY09 in Summary Q-1 2009 New Awards: $216M
• New awards primarily driven by
• MOX and Inner Harbor
contracts within the Federal
Navigation Canal Hurricane
business division
Protection projects continue to
• Some hurricane emergency
perform well
response work
• Overall, business is again
performing well
• Sold interest in final military
housing privatization ventures
Backlog EBITDA*
20.8
($ in billions) ($ in millions) 20.7
5.2 5.1 5.0
13.0
11.5
2.8 2.8
E&I Backlog:
$5.0 billion 5.2
33%
Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 F09
Q-1 FY08 Q-2 FY08 Q-3 FY08 Q-4 FY08 Q-1 FY09
E&I is returning to being a consistent performer
02M102007D
E&I is returning to being a consistent performer
Total Shaw Backlog: $14.8 billion
*See Appendices for a reconciliation to the corresponding GAAP measure.
24
25. Q-1 FY09 Summary
• Non-cash FX translation loss continues
to create volatility in GAAP earnings,
but operational performance remains
strong
• All operating segments had strong
financial results this quarter
• Execution of E&C, Fossil, and F&M
contracts continue to drive earnings
• E&I returning to being a consistent and
profitable performer
• Domestic nuclear market continues to
develop and contribution to earnings
expected to begin in FY 2010 as
02M102007D
anticipated
25
26. Investor Relations & Media Contact
Information
Investor Contact:
Chris D. Sammons
Vice President, Investor Relations
225.932.2546
chris.sammons@shawgrp.com
Media Contact:
Craig Pierce
Vice President
225.987.7461
craig.pierce@shawgrp.com
02M102007D
26
27. First Quarter FY 2009:
Earnings Conference Call
Regulation G Appendices
Thursday, January 8, 2008
02M102007D
28. Appendix 1: EBITDA Reconciliation
Q1 FY 2009
Q1 FY 2009
Westinghouse Excluding
(in millions) Consolidated Segment Westinghouse
Net Income (Loss) $ (39.9) $ (102.7) $ 62.8
Interest Expense 11.6 9.9 1.7
Depreciation and Amortization 12.6 - 12.6
Provision for Income Taxes (22.7) (67.0) 44.3
Income Taxes on Unconsolidated Subs 0.9 1.1 (0.2)
EBITDA $ (37.5) $ (158.7) $ 121.2
Revenue 1,900.4 N/A 1,900.4
EBITDA % -2.0% N/A 6.4%
02M102007D
Note: EBITDA is defined as earnings before interest expense, income taxes,
depreciation and amortization. EBITDA is an important financial measure used by The
Shaw Group Inc. to assess performance.
28
29. Appendix 1: EBITDA Reconciliation
Q1 FY 2008
Q1 FY 2008
Westinghouse Excluding
(in millions) Consolidated Segment Westinghouse
Net Income (Loss) $ 2.2 $ (35.5) $ 37.7
Interest Expense 11.1 8.9 2.2
Depreciation and Amortization 10.4 - 10.4
Provision for Income Taxes 2.1 (25.8) 27.9
Income Taxes on Unconsolidated Subs 3.5 3.1 0.4
EBITDA $ 29.3 $ (49.3) $ 78.6
Revenue 1,712.2 N/A 1,712.2
EBITDA % 1.7% N/A 4.6%
02M102007D
Note: EBITDA is defined as earnings before interest expense, income taxes,
depreciation and amortization. EBITDA is an important financial measure used by The
Shaw Group Inc. to assess performance.
29
30. Appendix 1: Segment EBITDA Reconciliation
Q1 FY09 & Q4 FY08
Q1 FY 2009
Energy & Environmental & Fabrication &
(in millions) Fossil & Nuclear Chemicals Maintenance Infrastructure Manufacturing
Income (loss) before income taxes, and earnings (losses)
from unconsolidated entities $ 35.9 $ 41.8 $ 8.2 $ 18.6 $ 30.4
Interest Expense 0.4 0.3 (0.0) 0.2 (0.0)
Depreciation and Amortization 3.3 2.3 0.8 3.0 2.5
Unconsolidated Subs, pre-tax - 0.6 - 0.3 -
Minority Interest, pre-tax - (3.4) - (1.3) (1.1)
EBITDA $ 39.6 $ 41.6 $ 9.0 $ 20.8 $ 31.8
Q4 FY 2008
Energy & Environmental & Fabrication &
(in millions) Fossil & Nuclear Chemicals Maintenance Infrastructure Manufacturing
Income (loss) before income taxes, and earnings (losses)
from unconsolidated entities $ 16.9 $ 40.2 $ (1.2) $ 16.7 $ 38.5
Interest Expense 0.5 (0.1) (0.0) 0.2 (0.0)
Depreciation and Amortization 3.1 1.6 0.7 3.8 2.4
Unconsolidated Subs, pre-tax - 0.6 - (1.1) -
Minority Interest, pre-tax - (2.5) - 1.1 (1.5)
EBITDA $ 20.5 $ 39.8 $ (0.5) $ 20.7 $ 39.4
02M102007D
Note: Segment EBITDA is defined as earnings before interest expense, income taxes,
depreciation and amortization. EBITDA is an important financial measure used by The
Shaw Group Inc. to assess performance.
30
31. Appendix 1: Segment EBITDA Reconciliation
Q3 FY08 & Q2 FY08
Q3 FY 2008 (Restated)
Energy & Environmental & Fabrication &
(in millions) Fossil & Nuclear Chemicals Maintenance Infrastructure Manufacturing
Income (loss) before income taxes, and earnings (losses)
from unconsolidated entities $ 38.5 $ 36.8 $ 14.5 $ 7.4 $ 29.1
Interest Expense 0.4 0.3 0.0 0.2 (0.5)
Depreciation and Amortization 2.8 2.1 0.7 4.0 1.9
Unconsolidated Subs, pre-tax - 0.6 - 2.0 0.6
Minority Interest, pre-tax - (6.2) - (2.1) (2.9)
EBITDA $ 41.7 $ 33.6 $ 15.2 $ 11.5 $ 28.2
Q2 FY 2008 (Restated)
Energy & Environmental & Fabrication &
(in millions) Fossil & Nuclear Chemicals Maintenance Infrastructure Manufacturing
Income (loss) before income taxes, and earnings (losses)
from unconsolidated entities $ 24.1 $ 11.7 $ 9.2 $ 5.4 $ 32.0
Interest Expense 0.2 1.0 (0.0) 0.2 (0.1)
Depreciation and Amortization 2.7 1.9 1.0 4.0 1.8
Unconsolidated Subs, pre-tax - 0.7 - (1.6) (0.0)
Minority Interest, pre-tax - (2.1) - (2.8) (1.9)
EBITDA $ 27.0 $ 13.2 $ 10.2 $ 5.2 $ 31.8
02M102007D
Note: Segment EBITDA is defined as earnings before interest expense, income taxes,
depreciation and amortization. EBITDA is an important financial measure used by The
Shaw Group Inc. to assess performance.
31
32. Appendix 1: Segment EBITDA Reconciliation
Q1 FY08
Q1 FY 2008
Energy & Environmental & Fabrication &
(in millions) Fossil & Nuclear Chemicals Maintenance Infrastructure Manufacturing
Income (loss) before income taxes, and earnings (losses)
from unconsolidated entities $ 33.2 $ 8.6 $ 11.3 $ 9.8 $ 27.1
Interest Expense 0.2 0.4 - 0.2 0.0
Depreciation and Amortization 2.4 1.6 0.6 3.7 1.8
Unconsolidated Subs, pre-tax - 0.5 - 0.7 (0.0)
Minority Interest, pre-tax - (1.7) - (1.4) (1.8)
EBITDA $ 35.8 $ 9.4 $ 11.9 $ 13.0 $ 27.1
02M102007D
Note: Segment EBITDA is defined as earnings before interest expense, income taxes,
depreciation and amortization. EBITDA is an important financial measure used by The
Shaw Group Inc. to assess performance.
32
33. Appendix 2: Q1 FY 09 Reconciliation of
Income excluding Westinghouse
(in millions, except per share data) Q1 FY 2009
Quarter ended November 30, 2008
Westinghouse Excluding
Consolidated Segment Westinghouse
Revenues $1,900.4 $0.0 $1,900.4
Cost of revenues 1,712.3 0.0 1,712.3
Gross profit 188.1 0.0 188.1
General and administrative expenses 73.1 0.1 73.0
Operating income (loss) 115.0 (0.1) 115.1
Interest expense (1.7) 0.0 (1.7)
Interest expense on JPY-denominated bonds including accretion and amortization (9.9) (9.9) 0.0
Interest income 3.9 0.0 3.9
Foreign currency translation gains (losses) on JPY-denominated bonds, net (161.2) (161.2) 0.0
Other foreign currency transaction gains (losses), net (2.3) 0.0 (2.3)
Other income (expense), net (1.9) 0.0 (1.9)
(173.1) (171.1) (2.0)
Income (loss) before income taxes, minority interest, earnings (losses) from
unconsolidated entities (b) (58.1) (171.2) 113.1
Provision (benefit) for income taxes (a) (22.7) (67.0) 44.3
Income (loss) before minority interest and earnings (losses) from unconsolidated entities (35.4) (104.2) 68.8
Minority interest (c) (5.9) 0.0 (5.9)
Income from 20% Investment in Westinghouse, net of income taxes 1.5 1.5 0.0
Earnings (losses) from unconsolidated entities, net of income taxes (0.1) 0.0 (0.1)
Net income (loss) ($39.9) ($102.7) $62.8
Net income (loss) per common share:
Basic income (loss) per common share $ (0.48) $ (1.23) $ 0.75
Diluted income (loss) per common share $ (0.48) $ (1.23) $ 0.75
Weighted average shares outstanding:
Basic 83.1 83.1 83.1
Diluted: 83.1 83.1 83.9
02M102007D
Effective tax rate [a/(b+c)] 36% 39% 41%
33 Note: Presents our income statement excluding the Investment in Westinghouse segment
34. Appendix 2: Q1 FY 08 Reconciliation of
Income excluding Westinghouse
Q1 FY 2008
(in millions, except per share data)
Quarter ended November 30, 2007
Westinghouse Excluding
Consolidated Segment Westinghouse
Revenues $1,712.2 $0.0 $1,712.2
Cost of revenues 1,577.2 0.0 1,577.2
Gross profit 135.0 0.0 135.0
General and administrative expenses 68.9 0.0 68.9
Operating income (loss) 66.1 (0.0) 66.1
Interest expense (2.2) 0.0 (2.2)
Interest expense on JPY-denominated bonds including accretion and amortization (8.9) (8.9) 0.0
Interest income 4.8 0.0 4.8
Foreign currency translation gains (losses) on JPY-denominated bonds, net (57.2) (57.2) 0.0
Other foreign currency transaction gains (losses), net 1.2 0.0 1.2
Other income (expense), net (0.3) 0.0 (0.3)
(62.6) (66.1) 3.5
Income (loss) before income taxes, minority interest, earnings (losses) from
unconsolidated entities (b) 3.5 (66.1) 69.6
Provision (benefit) for income taxes (a) 2.1 (25.8) 27.9
Income (loss) before minority interest and earnings (losses) from unconsolidated entities 1.4 (40.3) 41.7
Minority interest (c) (5.0) 0.0 (5.0)
Income from 20% Investment in Westinghouse, net of income taxes 4.8 4.8 0.0
Earnings (losses) from unconsolidated entities, net of income taxes 1.0 0.0 1.0
Net income (loss) $2.2 ($35.5) $37.7
Net income (loss) per common share:
Basic income (loss) per common share $ 0.03 $ (0.44) $ 0.47
Diluted income (loss) per common share $ 0.03 $ (0.42) $ 0.45
Weighted average shares outstanding:
Basic 80.7 80.7 80.7
02M102007D
Diluted: 83.6 83.6 83.6
Effective tax rate [a/(b+c)] -144% 39% 43%
34 Note: Presents our income statement excluding the Investment in Westinghouse segment
35. Appendix 3: E&C Pass-Through
Revenues and Cost Reconciliation
Energy and Chemicals
Energy and Chemicals Q1 FY 2009
Energy and Chemicals Q1 FY 2009 Excluding Pass-Through
(in millions) Q1 FY 2009 Pass-Through Costs Costs
Amount % Amount % Amount %
Income:
Revenues $ 321.7 100.0% $ (103.1) 100.0% $ 218.6 100.0%
Cost of Revenues 269.3 83.7% (103.1) 100.0% 166.2 76.0%
Gross Profit $ 52.4 16.3% $ - 0.0% $ 52.4 24.0%
Energy and Chemicals
Q1 FY 2008
Energy and Chemicals Energy and Chemicals
Q1 FY 2008 Q1 FY 2008 Excluding Pass-Through
(in millions) (Restated) Pass-Through Costs Costs
Amount % Amount % Amount %
Income:
Revenues $ 296.1 100.0% $ (134.4) 100.0% $ 161.7 100.0%
Cost of Revenues 279.7 94.5% (134.4) 100.0% $ 145.3 89.9%
Gross Profit $ 16.4 5.5% $ - 0.0% $ 16.4 10.1%
02M102007D
35 Note: Reconciliation of revenues and cost of revenues to revenues and costs of revenues excluding pass-through costs
