KBR’s Government Solutions (recently renamed from KBRwyle) business supports defense, space, aerospace, and other U.S. federal programs. KBR supports missions including research and development, systems engineering and integration, test and evaluation, mission planning, operations support, maintenance, and field logistics. They have been significantly diversifying their services in recent years – this is not just the same KBR that many of us know from LOGCAP support (although yes, they still do that, too).
KBR recently confirmed that their Global Industry Classification Standard (GICS) has changed to IT Consulting & Other Services (45102010), under the Information Technology industry. This GICS code is supposed to more accurately reflect the company’s business offerings, where more than 60% of KBR’s revenues stem from the government segment. KBR appears to have been previously classified as Construction and Engineering under the Industrials industry (20103010).
So, who is KBR Government Solutions?
KBR, Inc. was created through mergers as an engineering, procurement, construction (EPC) and services company. Over the past decade, the company has grown and diversified through a number of acquisitions. The following acquisitions have significantly changed KBR’s government services offerings.
Wyle, Inc. – Acquired in July 2016 for $570 million, this acquisition created the short lived “KBRwyle” brand. Wyle provided a range of specialized engineering, scientific, and technical services focused on DoD and NASA customers.
Honeywell Technology Solutions, Inc. (HTSI) – Acquired in September 2016 for approximately $300 million, HTSI was a wholly-owned subsidiary of Honeywell Aerospace with approximately 3,550 employees. HTSI provides professional space, security, logistics, and manpower services. HTSI primarily supported all DoD military branches and NASA.
Stinger Ghaffarian Technologies, Inc. (SGT) – Acquired in April 2018, SGT provides technology solutions, engineering services, mission operations, and scientific and IT software solutions primarily for NASA. This acquisition continued KBR’s expansion of high-end technology services, specifically in space exploration and support domain.
Customers
KBR Government Solutions’ top federal customers by spending are reflected below, with a dominant focus on NASA.
Figure 1 – KBR Government Solutions’ Top 10 Federal Customers by total spend (FY2014-FY2018)
If we break down the customer spend by legacy entity in Figure 2 (below), it helps understand where the customer domain knowledge comes from in tracing core lineage of KBR Government Solutions. As we can see, all four legacy entities provide NASA expertise and three of the four have experience with the larger DOD military buyers – U.S. Navy, Air Force, and Army.
Figure 2 – KBR Government Solutions’ legacy entities’ top federal customers by spend (FY2014-FY2018).
The company’s fastest-growing federal customers include the National Oceanic and Atmospheric Administration (NOAA), whose annual obligations have increased from under $500,000 in FY14 to $17 million in FY18; Defense Health Agency (DHA), which has increased from $29,000 to $5 million annually over the past five years; U.S. Customs and Border Protection (CBP), which has increased from $5 million to $26 million annually over the same time frame; and the U.S. Army, which has increased from $133 million in FY14 to $322 million in FY18.
Recent contract wins
KBR Government Solutions has won several other notable contracts over the past two years, reflecting their shift towards IT operations and services.
NASA Support Services
- Kennedy Space Center (KSC), Base Operations and Spaceport Services – In April 2019, the joint venture PAE-SGT Partners (PSP) was awarded the eight-year, $609 million contract to provide institutional support services at KSC and the NASA facilities at the Cape Canaveral Air Force Station. Note legacy SGT was acquired by KBR in 2018. This was a takeaway win from AECOM who had this through their 2014 acquisition of URS Corporation (via the EG&G Technical Services legacy business acquired in 2002).
- Goddard Space Flight Center (GSFC), Space Geodesy (SG) Satellite Laser Ranging (SLR) Ground Systems – In October 2018, KBR was awarded this $48 million contract to develop, construct, deploy, test, and commission six next-generation SG SLR ground systems.
- Johnson Space Center (JSC), Mission Systems Operations Contract (MSOC) – In February 2018, SGT was awarded this eight-year, $1.1 billion to provide the support to ensure the availability, integrity, reliability, and security of the Flight Operations Directorate’s Mission Systems supporting NASA spaceflight programs. This was a takeaway from Leidos.
Facilities and Operations Support
- U.S. Department of the Army, Logistics Civil Augmentation Program (LOGCAP) V – In April 2019, KBR was awarded a seat on the 10-year, $82 billion LOGCAP V IDIQ contract. They have already been awarded task orders to provide logistics support services in Afghanistan, as well as to support the U.S. European Command (EUCOM) and Northern Command (NORTHCOM). As GAO protests continue to escalate, it is always possible that this may change.
- Naval Facilities Engineering Command (NAVFAC) Atlantic, Camp Lemonnier Base Operations Support Services – In September 2017, KBR was awarded this eight-year, $441 million contract to support base operations at Camp Lemonnier, Djibouti. These services include public safety, air operations, ordnance, supply, facilities, vehicles and equipment, and environmental.
Other Support Services
- U.S. Special Operations Command (USSOCOM), Preservation of the Force and Family (POTFF) – In November 2018, KBR (tied to legacy Wyle) was awarded this eight-year, $500 million contract to provide human performance and behavioral health services to support the physical, mental, social, and spiritual capacity of the Special Operations Forces. These services include performance-based strength and conditioning programs, rehabilitation techniques, counseling, and other services. KBR can leverage its expertise on its Human Health and Performance Contract (HHPC) with NASA to carry out the POTFF mission. This was a takeaway from Booz Allen Hamilton.
- Defense Health Agency (DHA), Cybersecurity Support Services – In August 2018, KBR was awarded this three-year, $71 million Seaport-e task order to assist with cybersecurity and risk management framework (RMF) initiatives and provide support to the DHA Assessment and Authorization (A&A) Division.
- Federal Aviation Administration (FAA), Security Systems Maintenance Contract – In October 2017, KBR was awarded this five-year, $52 million contract to provide maintenance for security systems and equipment at more than 500 FAA locations nationwide.
FedSavvy Strategies Takeaway
KBR Government Solutions is shifting away from their heritage in EPC and logistics support services to a more diversified IT and professional services provider. Their acquisitions provide a larger footprint and new services across NASA, the U.S. Air Force and Army, and several growing agencies. Past is not prologue. The future KBR represents a different threat to your business. Perhaps you want to engage us on a Black Hat review to deal with threats such as these for your future capture efforts. ?
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