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Originally Posted by Azure
My money? Haliburton provides over 11 billion dollars of service to the US Military in Iraq; out of that money, or contract, they take home 330 million in profits. For a company that big, with that many people hired, I would say it is essential to make at least 1 billion dollars profit.
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But their costs are covered by the government--which effectively makes that more profitable, especially when you have them reporting higher costs than what they actually spent and other such shenanigans. I think government contracts are a slightly different animal.
After all, KBR's business is comprised almost exclusively of government military contracts. Clearly, somebody thinks that 10% margin is pretty good, or they wouldn't keep doing it.