KBR forced to cut Iraq workforce

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Audit: KBR must trim Iraq workforce or face fines

Ouch all around.

More on DynCorp, LOGCAP

Forbes continues its positive coverage of DynCorp International with an article providing a basic overview of their position on the LOGCAP IV contract and recent award of the Afghanistan-South task orders on that contract.

"DynCorp has emerged as one of the big winners of the wars in Iraq and Afghanistan, which now generate 53% of DynCorp's $3.1 billion of annual revenue. The company's revenue grew 45% last year thanks to a 51%-owned joint venture that has a multiyear $4.6 billion contract to supply 9,100 linguists to translate for U.S. soldiers in Iraq."

Certainly, DynCorp is doing quite well and finds themselves in a strong position in Afghanistan with a strong partner in CH2MHill. At the same time, the southern task orders will be a highly challenging environment to work in, on some high visibility construction projects. Overall the boom years for LOGCAP have temporarily passed, so investors should look another phase ahead to see how DynCorp can continue its diversification across the Defense & Government Services sector with this latest win.

Also mentioned in the article is the recent announcement that KBR will not protest either of the Afghanistan awards, even though one of its bids was lower than its winning competitor. KBR discussed this further during their Q209 earnings call, for which you can find a transcript here. Pages 2-3 discuss their stark prospects for Government Services (more commentary to come on that).