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AECOM reports fiscal fourth quarter and full year 2016 results
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LOS ANGELES--(BUSINESS WIRE)--Nov. 14, 2016-- AECOM (NYSE:ACM), a premier, fully integrated global infrastructure firm, today reported fourth quarter revenue of $4.3 billion and full year revenue of $17.4 billion. Net income1 and diluted earnings per share1 were $7 million and $0.05 in the fourth quarter, respectively. Net income1 and diluted earnings per share1 were $96 million and $0.62 for the full year. On an adjusted basis, diluted earnings per share2 was $0.65 for the fourth quarter and $3.00 for the full year.

       
Fourth Quarter Full Year
($ in millions,

except EPS)

    As Reported  

Adjusted
(Non-GAAP)

 

Adjusted YoY
% Change

As Reported  

Adjusted
(Non-GAAP)

 

 

Adjusted
YoY % Change

 

Revenue     $4,323   -   (8)% $17,411   -   (3)%
Operating Income     $69   $1873   (34)% $376   $8943   (6)%
Net Income     $71   $1022   (31)% $961   $4682   0%
EPS (Fully Diluted)     $0.051   $0.652   (32)% $0.621   $3.002   (3)%
Operating Cash Flow     $363   -   31% $814   -   7%
Free Cash Flow4     -   $326   22% - $677 (3)%
Backlog     $42,771   -   (1)%
Wins $6,300   -   N/A
 

Note: All comparisons are year over year unless otherwise noted, and use adjusted or Non-GAAP figures where available.

  • Achieved full year adjusted EPS2 and free cash flow4 guidance
  • Have now paid down $1.2 billion of debt since closing the URS transaction two years ago
  • Delivered second-consecutive year of double-digit growth in Building Construction
  • Continued strong profitability in Management Services with nearly $25 billion of bids under client evaluation
  • Record $6.3 billion of wins in the fourth quarter, reflecting the strength of our combined platform and growing client demand for design, build, finance, and operate services

Commenting on the results, Michael S. Burke, AECOM’s chairman and chief executive officer, said, “We achieved our EPS and free cash flow targets. However, our fiscal 2016 financial performance was negatively impacted by market challenges, including uneven client spending in our Americas Design business, continued market pressures from low oil and gas prices, and lower than anticipated earnings contributions from the sizable power and industrial construction wins in the second half of the year due to the timing.

“Importantly, we entered fiscal 2017 with strong momentum, and our confidence in the long-term trajectory of our business has never been greater. Our $6.3 billion of wins in the fourth quarter marked a new high, highlighted by the new NFL Rams stadium in Los Angeles and a 1.6 book-to-burn5 in our Americas Design business. We have a growing pipeline of pursuits that leverage our design, build, finance, and operate capabilities, including $7 billion of combined pursuits led by our Construction Services business alone. And our Management Services segment is poised to deliver significant backlog growth with $25 billion of bids under client review, much of which are in the mission critical and intelligence sector. These successes reflect the progress we have made to position our industry-leading capabilities to win larger, more complex projects in new markets.”

Stephen M. Kadenacy, AECOM’s president and chief operating officer, added, "We have integrated two large organizations and now have the industry’s best people, systems, and capabilities focused on growth. We are focused on driving collaboration across the company to meet our clients’ growing demands for integrated delivery.”

Wins and Backlog

Wins in the quarter of $6.3 billion resulted in a book-to-burn ratio5 of 1.4. Wins were driven by broad success in the Americas Design market, the selection to build the NFL Rams stadium in Los Angeles, and over $700 million of O&M wins with core oil and gas clients. Total backlog increased 4% from the third quarter to $42.8 billion. Backlog now includes the proportionate contract value of projects accounted for under the equity method.

Business Performance

In addition to providing consolidated financial results, AECOM reports separate financial information for its three segments: Design & Consulting Services, Construction Services and Management Services.

Design & Consulting Services (DCS)

The DCS segment delivers planning, consulting, architectural and engineering design services to commercial and government clients worldwide in markets such as transportation, facilities, environmental, energy, water and government.

Revenue in the fourth quarter was $1.9 billion. Constant-currency organic6 revenue declined 3.7% due primarily to a decline in the Americas partially offset by continued growth in the U.K. Full year revenue was $7.7 billion, and constant-currency organic6 revenue declined 1.3%. Adjusted operating income3 was $102 million and $514 million in the fourth quarter and full year, respectively.

Construction Services (CS)

The CS segment provides construction services for energy, sports, commercial, industrial, and public and private infrastructure clients.

Revenue in the fourth quarter was $1.6 billion. Full year revenue was $6.5 billion, a decline of 3.0%, with nearly 20% growth in the Building Construction business offset by weakness in the oil and gas market. Adjusted operating income3 was $23 million and $97 million in the fourth quarter and full year, respectively.

Management Services (MS)

The MS segment provides program and facilities management and maintenance, training, logistics, consulting, technical assistance and systems-integration services and information technology services, primarily for agencies of the U.S. government, national governments around the world and commercial customers.

Revenue in the fourth quarter and full year was $857 million and $3.3 billion, respectively. Adjusted operating income7 was $90 million and $399 million in the fourth quarter and full year, respectively. Fourth quarter operating income benefitted from resolutions of project and legal matters. The impact to adjusted EPS was $0.07. In addition, fourth quarter operating income benefitted from a $27 million project performance incentive award.

Tax Rate

The effective tax rate8 for adjusted earnings was 19.0% and 21.0% for the fourth quarter and full year, respectively. The tax rate was lower than anticipated in the fourth quarter due primarily to the jurisdictional mix of income. The full year tax rate was lower than anticipated due primarily to the benefit from the reversal of a deferred tax asset valuation allowance in the third quarter. Our adjusted tax rate was derived by re-computing the annual effective tax rate on earnings from adjusted net income (loss).8 The adjusted tax expense differs from the GAAP tax expense based on the deductibility and tax rate applied to each of the adjustments.

Cash Flow

Free cash flow4 for the fourth quarter was $326 million. For the full year, AECOM generated free cash flow of $677 million, which was within the Company’s guidance of $600 million to $800 million.

Balance Sheet

As of September 30th, 2016, AECOM had $692.1 million of total cash and cash equivalents, $3.4 billion of net debt and $888.4 million in unused capacity under its $1.05 billion revolving credit facility. Total debt has declined by $1.2 billion since closing the URS acquisition in October, 2014.

Financial Outlook

AECOM is initiating fiscal year 2017 adjusted EPS2 guidance of $2.70 to $3.10, which includes approximately $0.20 of anticipated gains related to AECOM Capital realizations.

The Company expects fiscal 2017 full year interest expense, excluding amortization of deferred financing fees, of approximately $190 million and a full-year share count of 159 million.

The Company expects an effective tax rate8 for adjusted earnings of approximately 20%, which is similar to fiscal 2016.

The Company expects $30 million of acquisition and integration expenses during the fiscal year.

Fiscal year 2017 capital expenditures9 are expected to be approximately $115 million. The Company expects depreciation expense of approximately $165 million and the amortization of intangible assets10 to be approximately $95 million.

Kadenacy Named President and Chief Operating Officer

Stephen M. Kadenacy, in addition to his existing operational duties as president, has been given the added title of chief operating officer. Mr. Kadenacy will continue to be responsible for AECOM’s global operations, and oversee strategy and mergers and acquisitions.

Conference Call

AECOM is hosting a conference call today at 12 p.m. EDT, during which management will make a brief presentation focusing on the Company's results, strategies and operating trends. Interested parties can listen to the conference call and view accompanying slides via webcast at www.aecom.com. The webcast will be available for replay following the call.

1 Defined as attributable to AECOM.

2 Defined as attributable to AECOM, excluding acquisition and integration related expenses, financing charges in interest expense, the amortization of intangible assets, and financial impacts associated with expected and actual dispositions of non-core businesses and assets.

3 Excluding intangible amortization and financial impacts associated with expected and actual dispositions of non-core businesses and assets.

4 Free cash flow is defined as cash flow from operations less capital expenditures net of proceeds from disposals, and is a non-GAAP measure.

5 Book-to-burn ratio is defined as the amount of wins divided by revenue recognized during the period, including revenue related to work performed in unconsolidated joint ventures.

6 Organic growth is at constant currency and excludes revenue associated with actual and planned non-core asset and business dispositions. Results expressed in constant currency are presented excluding the impact from changes in currency exchange rates.

7 Excluding intangible amortization.

8 Inclusive of non-controlling interest deduction and adjusted for acquisition and integration expenses, financing charges in interest expense, the amortization of intangible assets and financial impacts associated with actual and planned dispositions of non-core businesses and assets.

9 Capital expenditures, net of proceeds from disposals.

10 Amortization of intangible assets expense includes the impact of amortization included in equity in earnings of joint ventures and non-controlling interests.

About AECOM

AECOM (NYSE: ACM) is built to deliver a better world. We design, build, finance and operate infrastructure assets for governments, businesses and organizations in more than 150 countries. As a fully integrated firm, we connect knowledge and experience across our global network of experts to help clients solve their most complex challenges. From high-performance buildings and infrastructure, to resilient communities and environments, to stable and secure nations, our work is transformative, differentiated and vital. A Fortune 500 firm, AECOM companies had revenue of approximately $17.4 billion during the 12 months ended September 30, 2016. See how we deliver what others can only imagine at aecom.com and @AECOM.

Forward-Looking Statements: All statements in this press release other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including any projections of earnings, revenue, cash flows, tax rate, share count, interest expense, amortization of intangible assets, AECOM Capital contribution gains, acquisition and integration costs, or other financial items; any statements of the plans, strategies and objectives for future operations; and any statements regarding future economic conditions or performance. Although we believe that the expectations reflected in our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements.

Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in our forward-looking statements include, but are not limited to, the following: demand for our services is cyclical; uncertainties related to government contract appropriations; Budget Control Act of 2011; governmental agencies may modify, curtail or terminate our contracts; government contracts are subject to audits and adjustments of contractual terms; Brexit; losses under fixed-price contracts; limited control over operations run through our joint venture entities; misconduct by our employees or consultants or our failure to comply with laws or regulations applicable to our business; our leveraged position and ability to service our debt; ability to maintain surety and financial capacity; exposure to legal, political and economic risks in different countries as well as currency exchange rate fluctuations; the failure to retain and recruit key technical and management personnel; our insurance policies may not provide adequate coverage; unexpected adjustments and cancellations related to our backlog; dependence on third party contractors who fail to satisfy their obligations; systems and information technology interruption; and changing client preferences/demands, fiscal positions and payment patterns. Additional factors that could cause actual results to differ materially from our forward-looking statements are set forth in our reports filed with the Securities and Exchange Commission. We do not intend, and undertake no obligation, to update any forward-looking statement.

This press release contains financial information calculated other than in accordance with U.S. generally accepted accounting principles (“GAAP”). In particular, the Company believes that non-GAAP financial measures such as adjusted EPS, adjusted operating income, adjusted tax rate, organic revenue, and free cash flow also provide a meaningful perspective on its business results as the Company utilizes this information to evaluate and manage the business. We use adjusted net and operating income to exclude the impact of prior acquisitions. We use free cash flow to represent the cash generated after capital expenditures to maintain our business. Our non-GAAP disclosure has limitations as an analytical tool, should not be viewed as a substitute for financial information determined in accordance with GAAP, and should not be considered in isolation or as a substitute for analysis of our results as reported under GAAP, nor is it necessarily comparable to non-GAAP performance measures that may be presented by other companies. A reconciliation of these non-GAAP measures is found in the Regulation G tables at the back of this release.

         

AECOM

Consolidated Statements of Income

(in thousands, except per share data)

 
Three Months Ended Twelve Months Ended
Sep 30,
2015
  Sep 30,
2016
  %
Change
Sep 30,
2015
  Sep 30,
2016
  %
Change
Revenue $ 4,723,637 $ 4,323,096 (8.5)% $ 17,989,880 $ 17,410,825 (3.2)%
Cost of revenue 4,553,009 4,175,917 (8.3)% 17,454,692 16,768,001 (3.9)%
Gross profit 170,628 147,179 (13.7)% 535,188 642,824 20.1 %
 
Equity in earnings of joint ventures 29,917 21,240 (29.0)% 106,245 104,032 (2.1)%
General and administrative expenses (25,422 ) (28,131 ) 10.7 % (113,975 ) (115,088 ) 1.0 %
Acquisition and integration expenses (79,883 ) (71,215 ) (10.9)% (398,440 ) (213,642 ) (46.4)%
Loss on disposal activities 0.0 % (42,589 ) 0.0 %
Income from operations 95,240 69,073 (27.5)% 129,018 375,537 191.1 %
 
Other income 7,470 2,894 (61.3)% 19,139 8,180 (57.3)%
Interest expense (60,046 ) (73,405 ) 22.2 % (299,627 ) (258,162 ) (13.8)%
Income (loss) before income tax expense 42,664 (1,438 ) (103.4)% (151,470 ) 125,555 (182.9)%
 
Income tax expense (benefit) 16,187 (14,325 ) (188.5)% (80,237 ) (37,917 ) (52.7)%
 
Net income (loss) 26,477 12,887 (51.3)% (71,233 ) 163,472 (329.5)%
 
Noncontrolling interests in income of consolidated subsidiaries, net of tax (25,421 ) (5,683 ) (77.6)% (83,612 ) (67,363 ) (19.4)%
 
Net income (loss) attributable to AECOM $ 1,056 $ 7,204 582.2 % $ (154,845 ) $ 96,109 (162.1)%
 
Net income (loss) attributable to AECOM per share:
Basic $ 0.01 $ 0.05 400.0 % $ (1.04 ) $ 0.62 (159.6)%
Diluted $ 0.01 $ 0.05 400.0 % $ (1.04 ) $ 0.62 (159.6)%
 
Weighted average shares outstanding:
Basic 153,779 156,320 1.7 % 149,605 154,772 3.5 %
Diluted 155,231 157,856 1.7 % 149,605 156,073 4.3 %
 
   

Balance Sheet Information

(in thousands)

 
September 30,
2015
September 30,
2016
Balance Sheet Information:
Total cash and cash equivalents $ 683,893 $ 692,145
Accounts receivable – net 4,841,450 4,531,460
Working capital 1,410,033 696,015
Total debt 4,606,938 4,125,290
Total assets 14,014,298 13,726,745
Total AECOM stockholders’ equity 3,407,748 3,366,921
 
 
AECOM
Reportable Segments
(in thousands)
                     
Design &
Consulting
Services
Construction
Services
Management
Services
Corporate Total
Three Months Ended September 30, 2016
Revenue $ 1,906,978 $ 1,559,558 $ 856,560 $ - $ 4,323,096
Cost of revenue   1,823,963   1,556,235   795,719   -   4,175,917
Gross profit 83,015 3,323 60,841 - 147,179
Equity in earnings of joint ventures 2,657 9,256 9,327 - 21,240
General and administrative expenses - - - (28,131) (28,131)
Acquisition and integration expenses   -   -   -   (71,215)   (71,215)
Income (loss) from operations $ 85,672 $ 12,579 $ 70,168 $ (99,346) $ 69,073
 
Gross profit as a % of revenue 4.4% 0.2% 7.1% - 3.4%
 
 
Three Months Ended September 30, 2015
Revenue $ 2,041,749 $ 1,797,115 $ 884,773 $ - $ 4,723,637
Cost of revenue   1,942,894   1,781,734   828,381   -   4,553,009
Gross profit 98,855 15,381 56,392 - 170,628
Equity in earnings of joint ventures 3,532 5,967 20,418 - 29,917
General and administrative expenses - - - (25,422) (25,422)
Acquisition and integration expenses   -   -   -   (79,883)   (79,883)
Income (loss) from operations $ 102,387 $ 21,348 $ 76,810 $ (105,305) $ 95,240
 
Gross profit as a % of revenue 4.8% 0.9% 6.4% - 3.6%
 
 
AECOM
Reportable Segments
(in thousands)
                     
Design &
Consulting
Services
Construction
Services
Management
Services
Corporate Total
Twelve Months Ended September 30, 2016
Revenue $ 7,655,803 $ 6,501,319 $ 3,253,703 $ - $ 17,410,825
Cost of revenue   7,273,291   6,470,221   3,024,489   -   16,768,001
Gross profit 382,512 31,098 229,214 - 642,824
Equity in earnings of joint ventures 8,859 18,162 77,011 - 104,032
General and administrative expenses - - - (115,088) (115,088)
Acquisition and integration expenses - - - (213,642) (213,642)
Loss on disposal activities   -   (42,589)   -   -   (42,589)
Income (loss) from operations $ 391,371 $ 6,671 $ 306,225 $ (328,730) $ 375,537
 
Gross profit as a % of revenue 5.0% 0.5% 7.0% - 3.7%
 
Contracted backlog $ 8,035,454 $ 11,962,511 $ 3,711,723 $ - $ 23,709,688
Awarded backlog 6,328,531 5,132,931 3,945,313 - 15,406,775
Unconsolidated JV backlog   -   2,612,668   1,042,070   -   3,654,738
Total backlog $ 14,363,985 $ 19,708,110 $ 8,699,106 $ - $ 42,771,201
 
 
Twelve Months Ended September 30, 2015
Revenue $ 7,962,856 $ 6,676,741 $ 3,350,283 $ - $ 17,989,880
Cost of revenue   7,663,565   6,633,907   3,157,220   -   17,454,692
Gross profit 299,291 42,834 193,063 - 535,188
Equity in earnings of joint ventures 6,626 22,950 76,669 - 106,245
General and administrative expenses - - - (113,975) (113,975)
Acquisition and integration expenses   -   -   -   (398,440)   (398,440)
Income (loss) from operations $ 305,917 $ 65,784 $ 269,732 $ (512,415) $ 129,018
 
Gross profit as a % of revenue 3.8% 0.6% 5.8% - 3.0%
 
Contracted backlog $ 8,573,471 $ 11,190,214 $ 4,703,981 $ - $ 24,467,666
Awarded backlog 5,732,258 5,559,937 4,439,463 - 15,731,658
Unconsolidated JV backlog     933,479   1,995,993   -   2,929,472
Total backlog $ 14,305,729 $ 17,683,630 $ 11,139,437 $ - $ 43,128,796
 
 

AECOM

Regulation G Information

($ in millions)

 

Reconciliation of Amounts Provided by Acquired Companies

 
    Three Months Ended
September 30, 2016
    Twelve Months Ended
September 30, 2016
Total  

Provided by
Acquired
Companies

 

Excluding
Effect of
Acquired
Companies

Total  

Provided by
Acquired
Companies

 

Excluding
Effect of
Acquired
Companies

 
Revenue
AECOM Consolidated $ 4,323.1 $ - $ 4,323.1 $ 17,410.8 $ 302.0 $ 17,108.8
Design & Consulting Services 1,907.0 - 1,907.0 7,655.8 119.2 7,536.6
Construction Services 1,559.6 - 1,559.6 6,501.3 90.8 6,410.5
Management Services 856.5 - 856.5 3,253.7 92.0 3,161.7
 

Reconciliation of Net Income Attributable to AECOM to EBITDA

 
    Three Months Ended   Twelve Months Ended

Sep 30,
2015

  Jun 30

2016

  Sep 30,

2016

Sep 30,

2015

  Sep 30,

2016

 
Net income (loss) attributable to AECOM $ 1.1 $ 67.4 $ 7.2 $ (154.8 ) $ 96.1
Income tax expense (benefit)   16.2   (35.1 )   (14.3 )   (80.2 )   (37.9 )
Income (loss) attributable to AECOM before income taxes 17.3 32.3 (7.1 ) (235.0 ) 58.2
Depreciation and amortization expense1 151.3 98.3 92.1 607.0 414.5
Interest income2 (1.0 ) (1.2 ) (1.3 ) (4.8 ) (4.3 )
Interest expense3   54.2   57.1   55.4   282.5   225.8
EBITDA $ 221.8 $ 186.5 $ 139.1 $ 649.7 $ 694.2
1 Includes the amount for noncontrolling interests in consolidated subsidiaries
2 Included in other income
3 Excludes related amortization
 
 

Reconciliation of Total Debt to Net Debt

 
    Balances at:
Sep 30, 2015     Jun 30, 2016     Sep 30, 2016
Short-term debt $ 2.8 $ 20.8 $ 26.3
Current portion of long-term debt 157.6 333.3 340.0
Long-term debt 4,446.5 3,941.1 3,759.0
Total debt 4,606.9 4,295.2 4,125.3
Less: Total cash and cash equivalents 683.9 628.0 692.1
Net debt $ 3,923.0 $ 3,667.2 $ 3,433.2
 
 

Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow

 
    Three Months Ended

Dec 31,
2014

 

Mar 31,
2015

 

Jun 30,
2015

 

Sep 30,
2015

 

Dec 31,
2015

 

Mar 31,
2016

 

Jun 30,
2016

  Sep 30,
2016
Net cash provided by operating activities $ 282.6 $ 50.0 $ 153.8 $ 278.0 $ 78.0 $ 113.2 $ 260.1 $ 362.9
Capital expenditures, net of disposals (25.0 ) (30.6 ) (3.7 ) (10.1 ) (0.8 ) (30.3 ) (68.8 ) (36.9 )
Free cash flow $ 257.6 $ 19.4 $ 150.1 $ 267.9 $ 77.2 $ 82.9 $ 191.3 $ 326.0
 
 
Fiscal Years Ended Sep 30,
2014 2015 2016
Net cash provided by operating activities $ 360.6 $ 764.4 $ 814.2
Capital expenditures, net (62.8 ) (69.4 ) (136.8 )
Free cash flow $ 297.8 $ 695.0 $ 677.4
 
       

AECOM

Regulation G Information

(in millions, except per share data)

 

Reconciliation of Reported Amounts to Adjusted Amounts Excluding Acquisition and Integration

Related Expenses, Financing Charges in Interest Expense, the Amortization of Intangible Assets

and the Financial Impacts Associated with Dispositions of Non-Core Businesses and Assets

 
Three Months Ended Twelve Months Ended
Sep 30,
2015
  Jun 30,
2016
  Sep 30,
2016
Sep 30,
2015
  Sep 30,
2016
 
Income from operations $ 95.2 $ 110.4 $ 69.0 $ 129.0 $ 375.5
Non-core operating losses - 14.4 9.9 - 36.9
Acquisition and integration expenses 79.9 50.6 71.3 398.5 213.7
Loss on disposal activities - - - - 42.6
Amortization of intangible assets   108.3   43.8   36.6   428.3   225.4
Adjusted income from operations $ 283.4 $ 219.2 $ 186.8 $ 955.8 $ 894.1
 
 
Income (loss) before income tax expense $ 42.7 $ 49.3 $ (1.4 ) $ (151.5 ) $ 125.6
Non-core operating losses - 14.4 9.9 - 36.9
Acquisition and integration expenses 79.9 50.7 71.2 398.5 213.6
Loss on disposal activities - - - - 42.6
Amortization of intangible assets 108.3 43.8 36.6 428.3 225.4
Financing charges in interest expense   3.9   5.1   17.6   79.8   30.9
Adjusted income before income tax expense $ 234.8 $ 163.3 $ 133.9 $ 755.1 $ 675.0
 
 
Income tax expense (benefit) $ 16.3 $ (35.1 ) $ (14.3 ) $ (80.2 ) $ (37.9 )

Tax effect of the above adjustments

 

  34.2   53.1   38.3   256.1   162.4
Adjusted income tax expense $ 50.5 $ 18.0 $ 24.0 $ 175.9 $ 124.5

Adjusts the income tax expense (benefit) during the period to exclude the impact

on our effective tax rate of the pre-tax adjustments shown above.

 
 
Noncontrolling interests in income of consolidated subsidiaries, net of tax $ (25.4 ) $ (17.0 ) $ (5.7 ) $ (83.6 ) $ (67.4 )
Amortization of intangible assets included in NCI,
net of tax
  (11.0 )   (2.2 )   (2.3 )   (29.6 )   (15.0 )
Adjusted noncontrolling interests in income of consolidated subsidiaries, net of tax $ (36.4 ) $ (19.2 ) $ (8.0 ) $ (113.2 ) $ (82.4 )
 
 
Net income (loss) attributable to AECOM $ 1.1 $ 67.4 $ 7.2 $ (154.8 ) $ 96.1
Non-core operating losses - 14.4 9.9 - 36.9
Acquisition and integration expenses 79.9 50.7 71.2 398.5 213.6
Amortization of intangible assets 108.3 43.8 36.6 428.3 225.4
Loss on disposal activities - - - - 42.6
Financing charges in interest expense 3.9 5.1 17.6 79.8 30.9
Tax effect of the above adjustments (34.3 ) (53.1 ) (38.2 ) (256.2 ) (162.3 )
Amortization of intangible assets included in NCI,
net of tax
  (11.0 )   (2.2 )   (2.3 )   (29.6 )   (15.0 )
Adjusted net income attributable to AECOM $ 147.9 $ 126.1 $ 102.0 $ 466.0 $ 468.2
 
     

AECOM

Regulation G Information

(in millions, except per share data)

 

Reconciliation of Reported Amounts to Adjusted Amounts Excluding Acquisition and Integration

Related Expenses, Financing Charges in Interest Expense, the Amortization of Intangible Assets

and the Financial Impacts Associated with Dispositions of Non-Core Businesses and Assets

 
Three Months Ended Twelve Months Ended
Sep 30,
2015
  Jun 30,
2016
  Sep 30,
2016
Sep 30,
2015
  Sep 30,
2016
 
Net income (loss) attributable to AECOM – per diluted share* $ 0.01 $ 0.43 $ 0.05 $ (1.04 ) $ 0.62
Per diluted share adjustments:
Non-core operating losses - 0.09 0.06 - 0.24
Acquisition and integration expenses 0.51 0.32 0.45 2.63 1.37
Amortization of intangible assets 0.70 0.28 0.23 2.83 1.44
Loss on disposal activities - - - - 0.27
Financing charges in interest expense 0.03 0.03 0.11 0.54 0.20
Tax effect of the above adjustments (0.23 ) (0.33 ) (0.24 ) (1.68 ) (1.04 )
Amortization of intangible assets included in NCI,
net of tax
  (0.07 )   (0.01 )   (0.01 )   (0.20 )   (0.10 )
Adjusted net income attributable to AECOM – per diluted share* $ 0.95 $ 0.81 $ 0.65 $ 3.08 $ 3.00
 
Weighted average shares outstanding – diluted 155.2 156.2 157.9 151.3 156.1
*When there is a net loss, basic and dilutive GAAP EPS calculations use the same share count to avoid any

antidilutive effect; however, the adjusted EPS includes the dilutive shares excluded in the GAAP EPS.

 
 
EBITDA(1) $ 221.8 $ 186.5 $ 139.1 $ 649.7 $ 694.2
Non-core operating losses - 14.4 9.9 - 36.9
Acquisition and integration expenses 79.8 50.7 71.2 398.4 213.6
Loss on disposal activities - - - - 42.6
Depreciation expense included in acquisition and integration expense line above   (6.6 )   (7.7 )   (9.0 )   (20.9 )   (28.8 )
Adjusted EBITDA $ 295.0 $ 243.9 $ 211.2 $ 1,027.2 $ 958.5
Other expense (7.5 ) (1.5 ) (2.9 ) (19.2 ) (8.2 )
Interest expense(2) 1.0 1.2 1.3 4.8 4.3
Depreciation(3) (37.2 ) (43.6 ) (30.7 ) (170.3 ) (142.9 )
Noncontrolling interests in income of consolidated subsidiaries, net of tax 25.4 16.9 5.7 83.6 67.4
Amortization of intangible assets included in NCI, net of tax   6.7   2.3   2.2   29.7   15.0
Adjusted income from operations $ 283.4 $ 219.2 $ 186.8 $ 955.8 $ 894.1

(1) See Reconciliation of Net Income Attributable to AECOM to EBITDA

(2) Included in other income

(3) Excluding acquisition and integration related expense

 
       

AECOM

Regulation G Information

(in millions, except per share data)

 

Reconciliation of Segment Reported Amounts to Adjusted Amounts Excluding Acquisition and Integration

Related Expenses, Financing Charges in Interest Expense, the Amortization of Intangible Assets

and the Financial Impacts Associated with Dispositions of Non-Core Businesses and Assets

 
Three Months Ended Twelve Months Ended
Sep 30,
2015
    Jun 30,
2016
    Sep 30,
2016
Sep 30,
2015
    Sep 30,
2016
 
Segment income from Operations
Design & Consulting Services Segment:
Income from operations $ 102.4 $ 124.0 $ 85.7 $ 305.9 $ 391.4
Non-core operating losses - 14.4 9.9 - 31.7
Amortization of intangible assets   50.3   11.5   6.9   197.7   90.9
Adjusted income from operations $ 152.7 $ 149.9 $ 102.5 $ 503.6 $ 514.0
 
Construction Services Segment:
Income from operations $ 21.4 $ 12.6 $ 12.6 $ 65.8 $ 6.7
Non-core operating losses - - - - 5.2
Loss on disposal activities - - - - 42.6
Amortization of intangible assets   20.4   10.6   10.0   86.1   42.1
Adjusted income from operations $ 41.8 $ 23.2 $ 22.6 $ 151.9 $ 96.6
 
Management Services Segment:
Income from operations $ 76.7 $ 53.3 $ 70.1 $ 269.7 $ 306.2
Amortization of intangible assets   37.6   21.7   19.7   144.5   92.4
Adjusted income from operations $ 114.3 $ 75.0 $ 89.8 $ 414.2 $ 398.6
       

FY17 GAAP EPS Guidance based on Adjusted EPS Guidance

 

 

Fiscal Year End 2017

   
Implied GAAP EPS Guidance   $ 2.06 to $ 2.46
Adjusted EPS Excludes:
Amortization of intangible assets $0.60
Acquisition and integration-related expenses $0.19
Financing charges in interest expense $0.09
Tax effect of the above items*     ($0.24)
Adjusted EPS Guidance (Non-GAAP)   $ 2.70 to $ 3.10

*The adjusted tax expense differs from the GAAP tax expense based on the deductibility and tax rate applied to each of the adjustments.

Source: AECOM

AECOM
Investor Relations:
Will Gabrielski, 213-593-8208
VP, Investor Relations
William.Gabrielski@aecom.com
or
Media:
Brendan Ranson-Walsh, 212-739-7212
VP, External Communications
Brendan.Ranson-Walsh@aecom.com