News Release
- Third-quarter diluted earnings per share of 37 cents, up 42% from the same period last year.
- Net income for third quarter increased 59% year over year to $38.5 million.
- Operating income for third quarter increased 40% year over year to $64.2 million.
- Revenue for third quarter increased 20% year over year to $1.3 billion.
- Revenue, net of other direct costs, for the third quarter, increased 33% year over year to $853.3 million.
- Backlog at June 30, 2008, increased 15% year over year to $7.1 billion.
- Diluted earnings-per-share outlook raised to $1.34 to $1.37 for full fiscal year 2008.
LOS ANGELES--(BUSINESS WIRE)--Aug. 7, 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 third quarter of fiscal year 2008, which ended June 30, 2008.
AECOM reported net income of $38.5 million for the third quarter, or diluted earnings per share (EPS) of 37 cents. These results represent an increase of 59% over net income of $24.2 million for the same period last year. Operating income for the third quarter increased 40% year over year to $64.2 million. For the first nine months of fiscal year 2008, AECOM reported net income of $103.8 million and operating income of $167.7 million, an increase of 46% and 48%, respectively.
Third-quarter revenue increased to $1.3 billion, 20% higher than the third 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 June 30, 2008, increased 33% compared to the same period last year, to $853.3 million. For the first nine months of fiscal year 2008, AECOM reported revenue of $3.6 billion and revenue, net of other direct costs, of $2.3 billion, an increase of 14% and 31%, respectively.
"Our third-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. business performed even better. Our non-U.S. revenue now represents 56% of our gross revenue."
"We continue to see solid demand for our services globally throughout the infrastructure market," said Dionisio. "Projects such as our work in support of Qatar's New Doha Port Project, the largest maritime project in the world; the Eisenhower Executive Office Building, within the White House complex in Washington, D.C.; the Hong Kong International Airport master plan; and the U.S. Navy Guam expansion project 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 third quarter of fiscal year 2008, the PTS segment reported revenue of $1.1 billion and operating income of $70.5 million, compared to revenue of $904.3 million and operating income of $48.8 million for the same period during fiscal year 2007. This represents a 21% increase in revenue and a 44% increase in operating income year over year. PTS revenue, net of other direct costs, increased 32% for the three months ended June 30, 2008, to $809.7 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 third quarter of fiscal year 2008, the MSS segment reported revenue of $224.2 million and operating income of $10.6 million, compared to revenue of $196.3 million and operating income of $9.3 million for the same period during fiscal year 2007. This represents a 14% increase in revenue and a 15% 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 June 30, 2008, to $43.6 million.
Outlook
AECOM announced backlog totaling $7.1 billion at June 30, 2008, a 15% increase year over year.
"AECOM continued to deliver strong results across all of our end markets and geographies during the third quarter," said Michael S. Burke, AECOM executive vice president, chief corporate officer and chief financial officer. "Moreover, the $900-million increase in our year-over-year backlog indicates continued strength and solid momentum in our end markets."
Dionisio cited the nine acquisitions that AECOM has closed 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 three quarters of the fiscal year, as well as its strong backlog, AECOM has raised its EPS outlook for fiscal year 2008 to $1.34 to $1.37. This range takes into account an expected $0.01 per share dilution related to the recent Earth Tech acquisition.
Previously, AECOM expected that EPS would be $1.30 to $1.34, which did not include the $0.01 dilution associated with the Earth Tech acquisition.
AECOM is hosting a conference call today at 10 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 41,000 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 100 countries and had revenue of $4.7 billion during the 12-month period ended June 30, 2008. 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.
NR 08-0802
AECOM TECHNOLOGY CORPORATION
Condensed Consolidated Statements of Income
(in thousands, except per share data)
Three Months Ended Nine Months Ended
--------------------- ---------------------
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
---------- ---------- ---------- ----------
Revenue $1,321,203 $1,100,656 $3,565,574 $3,122,914
Other direct costs 467,919 456,965 1,285,952 1,386,607
---------- ---------- ---------- ----------
Revenue, net of other
direct costs 853,284 643,691 2,279,622 1,736,307
Cost of revenue, net of
other direct costs 437,263 331,600 1,167,614 891,926
---------- ---------- ---------- ----------
Gross profit 416,021 312,091 1,112,008 844,381
Equity in earnings of
joint ventures 5,313 3,992 12,163 7,628
General and administrative
expenses 357,152 270,401 956,498 738,375
---------- ---------- ---------- ----------
Income from operations 64,182 45,682 167,673 113,634
Minority interest in share
of earnings 4,862 3,824 10,939 9,058
Gain on sale of equity
investment -- -- -- 11,286
Non-Operating Income 756 -- (872) --
Interest income (expense)
- net (198) (6,312) 4,111 (9,615)
---------- ---------- ---------- ----------
Income before income tax
expense 59,878 35,546 159,973 106,247
Income tax expense 21,424 11,360 56,197 35,343
---------- ---------- ---------- ----------
Net income $ 38,454 $ 24,186 $ 103,776 $ 70,904
========== ========== ========== ==========
Net income allocation:
Preferred stock dividend $ 36 $ 68 $ 131 $ 184
Net income available for
common stockholders 38,418 24,118 103,645 70,720
---------- ---------- ---------- ----------
Net income $ 38,454 $ 24,186 $ 103,776 $ 70,904
========== ========== ========== ==========
Net income per share:
Basic $ 0.38 $ 0.30 $ 1.03 $ 1.09
========== ========== ========== ==========
Diluted $ 0.37 $ 0.26 $ 1.00 $ 0.85
========== ========== ========== ==========
Weighted average shares
outstanding:
Basic 102,020 80,915 100,745 64,948
Diluted 104,563 92,037 103,681 83,013
AECOM Technology Corporation
Balance Sheet and Cash Flow Information
(in thousands)
June 30, September
2008 30,
2007
---------- ----------
Balance Sheet Information:
Cash and cash equivalents $ 173,108 $ 216,911
Working capital 461,740 597,655
Working capital, net of cash and cash
equivalents 288,632 380,744
Total debt 88,840 47,950
Total stockholders' equity 1,448,751 1,278,485
Nine Months Ended
---------------------
June 30, June 30,
2008 2007
---------- ----------
Cash Flow Information
Net cash provided by operating activities $ 92,010 $ 20,339
AECOM TECHNOLOGY CORPORATION
Reportable Segments
($ in thousands)
Professional Management
Technical Support
Services Services Corporate Total
------------ ---------- --------- ----------
Three Months Ended June
30, 2008:
Revenue $1,096,986 $224,217 $ -- $1,321,203
Other direct costs 287,271 180,648 -- 467,919
------------ ---------- --------- ----------
Revenue, net of other
direct costs 809,715 43,569 -- 853,284
Cost of revenue, net of
other direct costs 411,416 25,847 -- 437,263
------------ ---------- --------- ----------
Gross profit 398,299 17,722 -- 416,021
Gross profit as a % of
revenue 36.3% 7.9% -- 31.5%
Gross profit as a % of
revenue, net of other
direct costs 49.2% 40.7% -- 48.8%
Equity in earnings of
joint ventures 2,922 2,391 -- 5,313
General and
administrative expenses 330,714 9,466 16,972 357,152
Segment income from
operations 70,507 10,647 (16,972) 64,182
Segment assets 2,561,708 210,721 148,562 2,920,991
Three Months Ended June
30, 2007:
Revenue $ 904,349 $196,307 $ -- $1,100,656
Other direct costs 291,799 165,166 -- 456,965
------------ ---------- --------- ----------
Revenue, net of other
direct costs 612,550 31,141 -- 643,691
Cost of revenue, net of
other direct costs 312,196 19,404 -- 331,600
------------ ---------- --------- ----------
Gross profit 300,354 11,737 -- 312,091
Gross profit as a % of
revenue 33.2% 6.0% -- 28.4%
Gross profit as a % of
revenue, net of other
direct costs 49.0% 37.7% -- 48.5%
Equity in earnings of
joint ventures 1,064 2,928 -- 3,992
General and
administrative expenses 252,598 5,394 12,409 270,401
Segment income from
operations 48,820 9,271 (12,409) 45,682
AECOM TECHNOLOGY CORPORATION
Reportable Segments
($ in thousands)
Professional Management
Technical Support
Services Services Corporate Total
------------ ---------- --------- ----------
Nine Months Ended June
30, 2008:
Revenue $2,945,494 $620,080 $ -- $3,565,574
Other direct costs 776,623 509,329 -- 1,285,952
------------ ---------- --------- ----------
Revenue, net of other
direct costs 2,168,871 110,751 -- 2,279,622
Cost of revenue, net of
other direct costs 1,100,597 67,017 -- 1,167,614
------------ ---------- --------- ----------
Gross profit 1,068,274 43,734 -- 1,112,008
Gross profit as a % of
revenue 36.3% 7.1% -- 31.2%
Gross profit as a % of
revenue, net of other
direct costs 49.3% 39.5% -- 48.8%
Equity in earnings of
joint ventures 6,630 5,533 -- 12,163
General and
administrative expenses 892,621 21,208 42,669 956,498
Segment income from
operations 182,283 28,059 (42,669) 167,673
Segment assets 2,561,708 210,721 148,562 2,920,991
Nine Months Ended June
30, 2007:
Revenue $2,501,436 $621,478 $ -- $3,122,914
Other direct costs 844,980 541,627 -- 1,386,607
------------ ---------- --------- ----------
Revenue, net of other
direct costs 1,656,456 79,851 -- 1,736,307
Cost of revenue, net of
other direct costs 844,771 47,155 -- 891,926
------------ ---------- --------- ----------
Gross profit 811,685 32,696 -- 844,381
Gross profit as a % of
revenue 32.4% 5.3% -- 27.0%
Gross profit as a % of
revenue, net of other
direct costs 49.0% 40.9% -- 48.6%
Equity in earnings of
joint ventures 960 6,668 -- 7,628
General and
administrative expenses 688,541 17,200 32,634 738,375
Segment income from
operations 124,104 22,164 (32,634) 113,634
CONTACT: AECOM
Paul Gennaro, 212-973-3167
SVP & Chief Communications Officer
paul.gennaro@aecom.com
SOURCE: AECOM Technology Corporation