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Kellogg Brown & Root’s (KBR) Spin-Off Plan: Can Two Pure-Plays Unlock Value?

Kellogg Brown & Root Inc. reported its first quarter of fiscal 2026 results highlighting a solid start to the year marked by disciplined operational execution, resilient performance, and continued focus on margin improvement and cash generation. Despite a $95 million year-over-year decline in consolidated revenues, primarily due to a planned reduction in EUCOM contingency work and award delays, adjusted EBITDA increased $3 million to $148 million, resulting in an expanded adjusted EBITDA margin of 13.1%, up from 12.3% a year earlier. Adjusted earnings per share at $0.96 were down slightly from $1.01, impacted mainly by higher financing expenses related to unconsolidated joint ventures, partially offset by share repurchases. Segment performance was mixed. Sustainable Technologies (STS) revenues were down $10 million due to timing of new awards ramping, while adjusted EBITDA increased by $2 million with margins expanding to 21.9%, supported by equity earnings from an LNG project.