News Release
- Second-quarter diluted earnings per share of 35 cents, up 30% from the same period last year.
- Net income for second quarter increased 69% year over year to $35.8 million.
- Operating income for second quarter increased 55% year over year to $59.0 million.
- Revenue for second quarter increased 7% year over year to $1.2 billion.
- Revenue, net of other direct costs increased 27% year over year to $750.8 million.
- Backlog at March 31, 2008, increased 20% year over year to $7.1 billion.
- Diluted earnings-per-share outlook raised to $1.30 to $1.34 for full fiscal year 2008.
LOS ANGELES--(BUSINESS WIRE)--May 8, 2008--AECOM Technology Corporation (NYSE: ACM), a leading provider of professional technical and management support services for government and commercial clients around the world, announced today its financial results for the second quarter of fiscal year 2008, which ended March 31, 2008.
AECOM reported net income of $35.8 million for the second quarter, or diluted earnings per share (EPS) of 35 cents. These results represent an increase of 69% over net income of $21.2 million for the same period last year. Operating income for the second quarter increased 55% year over year to $59.0 million. For the first six months of fiscal year 2008, AECOM reported net income of $65.3 million and operating income of $103.5 million, an increase of 40% and 52%, respectively.
Second-quarter revenue increased to $1.2 billion, 7% higher than the second quarter of fiscal year 2007. AECOM's gross revenue includes a significant amount of pass-through costs and, therefore, revenue, net of other direct costs, which is a non-GAAP measure, also provides a valuable perspective on its business results. AECOM's revenue, net of other direct costs for the three months ended March 31, 2008, increased 27% compared to the same period last year, to $750.8 million. For the first six months of fiscal 2008, AECOM reported revenue of $2.2 billion and revenue, net of other direct costs of $1.4 billion, an increase of 11% and 31%, respectively.
"Our second-quarter results were marked by strong global growth," said John M. Dionisio, AECOM president and chief executive officer. "During the quarter, we saw continued strength in our U.S. business, while our non-U.S. revenue continued to increase - our non-U.S. revenue now represents 53% of our total revenue."
"The global infrastructure market continues to fuel a solid demand for our services," said Dionisio. "Projects such as our work in support of Abu Dhabi's Ain Khalid Commercial Avenue project, the Los Angeles International Airport Capital Improvement Program, and evolving work for the Libyan Housing and Infrastructure Board highlight the breadth and diversification of our success."
Business Segments
In addition to providing consolidated financial results, AECOM reports separate financial information for its two segments: Professional Technical Services (PTS) and Management Support Services (MSS).
Professional Technical Services
The PTS segment delivers planning, consulting, architecture and engineering design, and program and construction management services to institutional, commercial and government clients worldwide.
For the second quarter of fiscal 2008, the PTS segment reported revenue of $955.1 million and operating income of $60.6 million, compared to revenue of $843.2 million and operating income of $39.4 million for the same period during fiscal year 2007. This represents a 13% increase in revenue and a 54% increase in operating income year over year. PTS revenue, net of other direct costs, increased 27% for the three months ended March 31, 2008, to $710.6 million.
Management Support Services
The MSS segment provides program and facilities management and maintenance, training, logistics, consulting, technical assistance and systems integration services, primarily for agencies of the U.S. government.
For the second quarter of fiscal year 2008, the MSS segment reported revenue of $209.1 million and operating income of $14.0 million, compared to revenue of $240.5 million and operating income of $8.3 million for the same period during fiscal year 2007. This represents a 13% decrease in revenue and a 68% increase in operating income year over year. Segment results for the quarter were positively affected by the release of key task orders and the resolution of government contract negotiations. MSS revenue, net of other direct costs, increased 40% for the three months ended March 31, 2008, to $40.1 million.
Outlook
AECOM announced backlog totaling $7.1 billion at March 31, 2008, a 20% increase year over year.
"AECOM continued to deliver strong results across all of our end markets and geographies during the second quarter," said Michael S. Burke, AECOM executive vice president, chief corporate officer and chief financial officer. "Moreover, the $1.2-billion increase in our year-over-year backlog indicates continued strength and solid momentum in our end markets."
Dionisio cited the five acquisitions that AECOM has announced year to date as an indicator of the company's execution on its strategic plan. "Our ability to complement our organic growth with key acquisitions positions us well to leverage the opportunities that we see in the global infrastructure market."
Based on its results through the first half of the fiscal year, as well as its strong backlog, AECOM has raised its EPS outlook for fiscal year 2008 to $1.30 to $1.34.
AECOM is hosting a conference call today at 11 a.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 on the Internet at www.aecom.com. The webcast will be available for replay following the call.
About AECOM
AECOM (NYSE: ACM) is a global provider of professional technical and management support services to a broad range of markets, including transportation, facilities, environmental and energy. With more than 35,000 employees around the world, AECOM is a leader in all of the key markets that it serves. AECOM provides a blend of global reach, local knowledge, innovation, and technical excellence in delivering solutions that enhance and sustain the world's built, natural, and social environments. AECOM serves clients in more than 60 countries and had revenue of $4.2 billion during fiscal year 2007. More information on AECOM and its services can be found at www.aecom.com.
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 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 forward-looking statements include: uncertainties related to funding, audits, modifications and termination of long-term government contracts; 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; failure to successfully execute our merger and acquisition strategy; the need to retain and recruit key technical and management personnel; and unexpected adjustments and cancellations related to our backlog. 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.
AECOM Technology Corporation
Condensed Consolidated Statements of Income
(in thousands, except per share data)
Three Months Ended Six Months Ended
---------------------- ----------------------
March 31, March 31, March 31, March 31,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Revenue $1,164,121 $1,083,709 $2,244,371 $2,022,258
Other direct costs 413,369 494,227 818,033 929,642
---------- ---------- ---------- ----------
Revenue, net of
other direct costs 750,752 589,482 1,426,338 1,092,616
Cost of revenue,
net of other
direct costs 381,357 305,611 730,351 560,326
---------- ---------- ---------- ----------
Gross profit 369,395 283,871 695,987 532,290
Equity in earnings of
joint ventures 4,008 2,219 6,850 3,636
General and
administrative
expenses 314,444 248,146 599,346 467,974
---------- ---------- ---------- ----------
Income from
operations 58,959 37,944 103,491 67,952
Minority interest in
share of earnings 4,798 3,648 6,077 5,234
Other expense 813 -- 1,628 --
Gain on the sale of
equity investment -- -- -- 11,286
Interest income
(expense) and other,
net 2,061 (2,228) 4,309 (3,303)
---------- ---------- ---------- ----------
Income before
income tax expense 55,409 32,068 100,095 70,701
Income tax expense 19,580 10,870 34,773 23,983
---------- ---------- ---------- ----------
Net income $ 35,829 $ 21,198 $ 65,322 $ 46,718
========== ========== ========= ==========
Net income
allocation:
Preferred stock
dividend $ 39 $ 87 $ 95 $ 116
Net income
available for
common
stockholders 35,790 21,111 65,227 46,602
---------- ---------- ---------- ----------
Net income $ 35,829 $ 21,198 $ 65,322 $ 46,718
========== ========== ========== ==========
Net income per share:
Basic $ 0.36 $ 0.37 $ 0.65 $ 0.82
========== ========== ========== ==========
Diluted $ 0.35 $ 0.27 $ 0.63 $ 0.60
========== ========== ========== ==========
Weighted average
shares outstanding:
Basic 100,571 56,331 100,108 56,965
Diluted 103,454 77,964 103,240 78,500
AECOM Technology Corporation
Balance Sheet and Cash Flow Information
(in thousands)
March 31, 2008 September 30, 2007
------------------ ------------------
Balance Sheet Information:
Cash and cash equivalents $ 217,675 $ 216,911
Working capital 546,554 597,655
Working capital, net of cash
and cash equivalents 328,879 380,744
Total debt 51,548 47,950
Total stockholders' equity 1,387,138 1,278,485
Six Months Ended
-------------------------------------
March 31, 2008 March 31, 2007
------------------ ------------------
Cash Information
Net cash provided by
operating activities $ 3,267 $ 53,730
AECOM TECHNOLOGY CORPORATION
Reportable Segments
(in thousands)
Professional Management
Technical Support
Services Services Corporate Total
------------ ---------- --------- -----------
Three Months Ended March
31, 2008:
Revenue $ 955,067 $ 209,054 $ - $1,164,121
Other direct costs 244,436 168,933 413,369
------------ ---------- --------- -----------
Revenue, net of other
direct costs 710,631 40,121 - 750,752
Cost of revenue, net of
other direct costs 359,944 21,413 - 381,357
------------ ---------- --------- -----------
Gross profit 350,687 18,708 - 369,395
Gross profit as a % of
revenue 36.7% 8.9% - 31.7%
Gross profit as a % of
revenue, net of other
direct costs 49.3% 46.6% - 49.2%
Equity in earnings of
joint ventures 2,676 1,332 - 4,008
General and
administrative expenses 292,809 6,052 15,583 314,444
Operating income 60,554 13,988 (15,583) 58,959
Segment assets 2,246,431 198,919 256,583 2,701,933
Three Months Ended March
31, 2007:
Revenue $ 843,218 $ 240,491 $ - $1,083,709
Other direct costs 282,359 211,868 494,227
------------ ---------- --------- -----------
Revenue, net of other
direct costs 560,859 28,623 - 589,482
Cost of revenue, net of
other direct costs 289,830 15,781 - 305,611
------------ ---------- --------- -----------
Gross profit 271,029 12,842 - 283,871
Gross profit as a % of
revenue 32.1% 5.3% - 26.2%
Gross profit as a % of
revenue, net of other
direct costs 48.3% 44.9% - 48.2%
Equity in earnings of
joint ventures 681 1,538 - 2,219
General and
administrative expenses 232,264 6,035 9,847 248,146
Operating income 39,446 8,345 (9,847) 37,944
AECOM TECHNOLOGY CORPORATION
Reportable Segments
(in thousands)
Professional Management
Technical Support
Services Services Corporate Total
------------ ---------- --------- -----------
Six Months Ended March
31, 2008:
Revenue $ 1,848,508 $ 395,863 $ - $2,244,371
Other direct costs 489,352 328,681 818,033
------------ ---------- --------- -----------
Revenue, net of other
direct costs 1,359,156 67,182 - 1,426,338
Cost of revenue, net of
other direct costs 689,181 41,170 - 730,351
------------ ---------- --------- -----------
Gross profit 669,975 26,012 - 695,987
Gross profit as a % of
revenue 36.2% 6.6% - 31.0%
Gross profit as a % of
revenue, net of other
direct costs 49.3% 38.7% - 48.8%
Equity in earnings of
joint ventures 3,708 3,142 - 6,850
General and
administrative expenses 561,907 11,742 25,697 599,346
Operating income 111,776 17,412 (25,697) 103,491
Segment assets 2,246,431 198,919 256,583 2,701,933
Six Months Ended March
31, 2007:
Revenue $ 1,597,087 $ 425,171 $ - $2,022,258
Other direct costs 553,181 376,461 929,642
------------ ---------- --------- -----------
Revenue, net of other
direct costs 1,043,906 48,710 - 1,092,616
Cost of revenue, net of
other direct costs 532,575 27,751 - 560,326
------------ ---------- --------- -----------
Gross profit 511,331 20,959 - 532,290
Gross profit as a % of
revenue 32.0% 4.9% - 26.3%
Gross profit as a % of
revenue, net of other
direct costs 49.0% 43.0% - 48.7%
Equity in earnings of
joint ventures (104) 3,740 - 3,636
General and
administrative expenses 435,943 11,806 20,225 467,974
Operating income 75,284 12,893 (20,225) 67,952
CONTACT: AECOM Technology Corporation
Paul Gennaro, 212-973-3167
SVP & Chief Communications Officer
paul.gennaro@aecom.com
SOURCE: AECOM Technology Corporation