Financial Highlights
- Adjusted EPS1 of $0.68.
- Free cash flow2 of $77 million in the first quarter.
- On track with full-year free cash flow target of $600 million to $800 million for fiscal years 2016 and 2017.
- Q1 debt reduction of $84 million; $804 million since the close of the URS transaction.
- Wins of $4.4 billion; book-to-burn3 of 1.0x.
- Company reiterates fiscal year 2016 adjusted EPS1 guidance of $3.00 to $3.40.
LOS ANGELES — (BUSINESS WIRE) — February 9, 2016 — AECOM (NYSE: ACM), a premier, fully integrated global infrastructure firm, reported first-quarter revenue of $4.3 billion today. Net loss4 and loss per share4 were $20 million and $0.13 in the first quarter, respectively. On an adjusted basis, diluted earnings per share1 was $0.68. Better than expected performance on the resolution of acquisition related project and legal matters had a net $0.07 impact on our adjusted earnings per share.
| First Quarter | |||||||||
| ($ in millions, except EPS) | Q1 FY15 | Q1 FY16 |
YOY % Change |
||||||
| Revenue | $4,210 | $4,298 | 2% | ||||||
| Operating Income | ($14) | $96 | NM | ||||||
| Net Loss4 | ($139) | ($20) | NM | ||||||
| Adjusted EPS1 | $0.80 | $0.68 | (15%) | ||||||
| Free Cash Flow2 | $258 | $77 | (70%) | ||||||
| Backlog | $40,694 | $40,180 | (1%) | ||||||
Note: All comparisons are year over year unless otherwise noted.
“Our performance is supported by our broadly diversified mix of geographies and end-markets, as well as our differentiated ability to design, build, finance and operate critical infrastructure assets around the world,” said Michael S. Burke, AECOM’s chairman and chief executive officer. “We are energized by the recent passage of a 5-year surface transportation bill in the U.S., and the opportunities resulting from an expansion of the services we deliver through our global footprint.”
“We are driving operational performance through our investments in the best people and most advanced systems in our industry,” said Stephen M. Kadenacy, AECOM’s president. “We are committed to delivering on our financial and operational objectives through consistent performance and execution.”
Wins and Backlog
Wins in the quarter of $4.4 billion were driven primarily by the building construction business within the Construction Services segment. The book-to-burn ratio3 was over 1.0. The Company’s total backlog of $40.2 billion increased slightly from the prior quarter after adjusting for currency fluctuations.
Business Segments
In addition to providing consolidated financial results, AECOM reports separate financial information for its three segments: Design & Consulting Services (DCS), Construction Services (CS), and Management Services (MS).
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 first quarter was $1.9 billion. Constant-currency5 organic revenue declined 5 percent. Adjusted operating income6 increased to $121 million compared to $98 million in the year ago period, due to operating efficiencies achieved through synergy savings.
Construction Services (CS)
The CS segment provides construction services for energy, commercial, industrial and public and private infrastructure clients.
Revenue in the first quarter was $1.7 billion. Organic revenue increased 6 percent, with strong growth in building construction more than offsetting weakness in oil and gas markets. Adjusted operating income6 was $32 million compared to $73 million in the year ago period.
Management Services (MS)
The MS 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, national governments around the world, and commercial customers.
Revenue in the first quarter was $724 million. Organic revenue declined 19 percent driven by the contemplated reduction in chemical demilitarization revenue and lower Middle East defense support services activity. Adjusted operating income7 was $95 million compared to $102 million in the year ago period.
Tax Rate
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 expected and actual dispositions of non-core businesses and assets the effective tax rate was 25.0 percent.
Cash Flow
Free cash flow2 for the first quarter was $77 million; on track to achieve full-year free cash flow target of $600 million to $800 million for fiscal years 2016 and 2017.
Balance Sheet
As of December 31, 2015, AECOM had $658 million of total cash and cash equivalents, $4.5 billion of debt and $951 million in unused capacity under its $1.05 billion revolving credit facility.
