BWXT secures C$1 billion in nuclear project contracts

CAMBRIDGE, Ontario - BWX Technologies, Inc. (NYSE:BWXT), whose stock has delivered an impressive 57% return over the past year and currently commands a market capitalization of $10.2 billion, has secured contracts exceeding C$1 billion in value for nuclear energy projects that will support Ontario Power Generation (HM:PGV)'s (OPG) initiatives, including the life extension of the Pickering Nuclear Generating Station and the introduction of a new small modular reactor (SMR) at the Darlington site. According to InvestingPro analysis, BWXT currently trades above its Fair Value, reflecting strong investor confidence in its growth prospects.

The company will produce 48 steam generators for the Pickering life extension program, a project expected to generate over 250 specialized trade positions and extend the station's operational lifespan by 30 years. With a robust current ratio of 2.25 and operating with moderate debt levels, BWXT demonstrates the financial stability needed for such large-scale projects. CanAtom, a joint venture between AtkinsRéalise and Aecon, is the customer for this work, with a significant portion of the contract recorded in the fourth quarter of 2024. InvestingPro subscribers can access 16 additional key insights about BWXT's financial position and growth prospects.

Additionally, BWXT announced a separate contract to manufacture the reactor pressure vessel (RPV) for GE Hitachi (OTC:HTHIY) Nuclear Energy's BWRX-300 SMR, marking the first North American manufacturer to undertake such a project. This order, which was booked in the second quarter of 2024, positions BWXT as a pivotal contributor to the deployment of SMRs both in Canada and globally.

Ontario's Minister of Energy and Electrification, Stephen Lecce, expressed his support for the initiatives, highlighting the role of Ontario's skilled workforce in fulfilling the province's increasing electricity demands and cementing its status as a leader in new nuclear technologies.

John MacQuarrie, president of BWXT Commercial Operations, emphasized the company's readiness to support the creation of a future with abundant, emissions-free electricity while boosting sustainable, well-paying jobs in Canada.

The Pickering Life Extension Program is currently in its initial stages, with completion expected in the mid-2030s. The Pickering B fleet of reactors, which includes four operating CANDU® reactors, provides roughly 10% of Ontario's electricity. OPG's President and CEO, Nicolle Butcher, underscored the importance of OPG's robust nuclear supply chain and partners like BWXT in ensuring the timely, safe, and quality completion of these projects.

The BWRX-300, slated for the OPG Darlington New Nuclear Project, is anticipated to be the first on-grid SMR in G7 nations. It is a 300-MWe water-cooled, natural circulation SMR with passive safety systems that build upon the design and licensing basis of GEH's U.S. NRC-certified ESBWR.

BWXT's Cambridge facility, already one of the largest commercial nuclear equipment manufacturing sites in North America, is preparing for a C$80 million expansion to meet the growing demand for nuclear projects in Ontario and beyond.

This news is based on a press release statement from BWXT, which includes forward-looking statements subject to risks and uncertainties such as contract modifications, terminations, or delays. BWXT has clarified that the contract values mentioned may not necessarily indicate future revenues and has advised against undue reliance on these forward-looking statements. The company maintains strong fundamentals with a 12% revenue growth in the last twelve months and has consistently raised its dividend for nine consecutive years, currently yielding 0.75%. For detailed analysis and comprehensive financial metrics, investors can access BWXT's full research report on InvestingPro, which includes expert insights and advanced valuation models.

In other recent news, BWX Technologies, Inc. has reported a 14% increase in organic revenue growth and a significant rise in adjusted earnings per share (EPS) in its third-quarter results. The company has upgraded its 2024 adjusted EPS guidance to approximately $3.20 and maintains a robust free cash flow outlook of $225 million to $250 million for the same year. BWXT also secured a $3 billion contract from the U.S. Department of Energy for cleanup efforts at the West Valley Demonstration Project in New York.

In addition, BWXT has announced the acquisition of Kinectrics, Inc., a Canadian firm specializing in lifecycle management services for the nuclear industry. The deal, valued at approximately $525 million, is expected to significantly enhance BWXT's Commercial Operations segment. Kinectrics is projected to generate $300 million in revenue for 2024.

Furthermore, BWXT has disclosed a significant compensation arrangement for its Executive Vice President and Chief Financial Officer, Robb A. LeMasters. The company's Board of Directors approved a grant of 10,000 performance-based restricted stock units (PSUs) to Mr. LeMasters, valued at approximately $1.15 million. The grant is contingent upon achieving specific financial targets over a three-year period, ending December 31, 2027. These recent developments reflect BWXT's emphasis on performance and growth, as well as its commitment to executive retention.

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