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Impairments from three projects sting McDermott International’s 2018 earnings

David Dickson, president and CEO of McDermott
David Dickson, president and CEO of McDermott

Impairments from three large projects stung Houston service company McDermott International, which closed 2018 with a $2.7 billion loss.

McDermott International reported closing 2018 with a $2.7 billion loss on $6.7 billion of revenue. By comparison, the company closed 2017 with a $179 million profit on $3 billion of revenue.

The Houston service company’s end-of-year earnings were dragged down by $2.2 billion in impairment costs attributed company’s Cameron LNG, Freeport LNG and Calpine projects during the fourth quarter.

“Although the headline numbers distract from the company’s underlying fundamental strength, McDermott is continuing to progress toward the realisation of its full potential as a premier, fully integrated provider of technology, engineering and construction solutions,” McDermott International CEO David Dickson said in a statement.

The impairment costs resulted in a $2.8 billion loss on $2.1 billion of revenue for the company during the fourth quarter. The figures represented a huge swing from the $26 million profit on $718 million of revenue during the fourth quarter of 2017.

McDermott reported profits during the first, second and third quarter of 2018 but those figures were not enough to make up for the fourth quarter loss.

Founded in 1923, McDermott provides design, engineering and construction services to petrochemical plants, liquefied natural gas plants and offshore oil and natural gas facilities. The company has more than 32,000 employees in 54 nations.

This article first appeared on the Houston Chronicle – an Energy Voice content partner. For more from the Houston Chronicle click here.

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