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. 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 had revenue of approximately $20.2 billion during fiscal year 2018. See how we deliver what others can only imagine at aecom.com and @AECOM.

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, cost savings, profitability, cash flows, tax rate, share count, stock repurchases, interest expense, capital expenditures, amortization of intangible assets and financial fees, or other financial items, any statements of the plans, strategies and objectives for future operations, profitability, strategic value creation, risk profile and investment strategies 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: our business is cyclical and vulnerable to economic downturns and client spending reductions; long-term government contracts and subject to uncertainties related to government contract appropriations; government shutdowns; governmental agencies may modify, curtail or terminate our contracts; government contracts are subject to audits and adjustments of contractual terms; losses under fixed-price contracts; limited control over operations run through our joint venture entities; liability for misconduct by our employees or consultants; failure to comply with laws or regulations applicable to our business; maintaining adequate surety and financial capacity; high leveraged and potential inability to service our debt and guarantees; exposure to Brexit; exposure to political and economic risks in different countries; currency exchange rate fluctuations; retaining and recruiting key technical and management personnel; legal claims; inadequate insurance coverage; environmental law compliance and adequate nuclear indemnification; unexpected adjustments and cancellations related to our backlog; partners and third parties who may fail to satisfy their legal obligations; AECOM Capital real estate development projects; managing pension cost; cybersecurity issues and IT outages; as well as other additional risks and factors that could cause actual results to differ materially from our forward-looking statements 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 EBITDA, adjusted operating income, adjusted tax rate, adjusted interest expense, 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 EBITDA, EPS and operating income to exclude the impact of non-operating items, such as amortization expense, taxes, acquisition and integration expenses, and non-core operating losses. 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 Information tables at the back of this release.

We present constant currency information to help assess how our underlying businesses performed excluding the effect of foreign currency rate fluctuations. We provide this non-GAAP financial information to aid investors in better understanding our international operational performance.

When we provide our long term projections for organic revenue growth, adjusted EBITDA, adjusted EPS growth, and free cash flow on a forward-looking basis, the closest corresponding GAAP measure and a reconciliation of the differences between the non-GAAP expectation and the corresponding GAAP measure generally is not available without unreasonable effort due to length of the forecasted period and potential high variability, complexity and low visibility as to items that would be excluded from the GAAP measure in the relevant future period.

AECOM
Consolidated Statement of Income
(unaudited - in thousands, except per share data)
		Three Months Ended
		December 31, 2017				December 31, 2018				% Change
Revenue		$	4,910,832			$	5,037,495			2.6	%
Cost of revenue			4,774,680				4,866,882			1.9	%
Gross profit			136,152				170,613			25.3	%
Equity in earnings of joint ventures			29,720				12,504			(57.9	%)
General and administrative expenses			(34,670	)			(35,907	)		3.6	%
Restructuring costs			-				(63,295	)		0.0	%
Income from operations			131,202				83,915			(36.0	%)
Other income			2,283				3,597			57.6	%
Interest expense			(56,165	)			(56,026	)		(0.2	%)
Income before income tax benefit			77,320				31,486			(59.3	%)
Income tax benefit			(47,093	)			(33,600	)		(28.7	%)
Net income			124,413				65,086			(47.7	%)
Noncontrolling interest in income of consolidated subsidiaries, net of tax			(13,099	)			(13,567	)		3.6	%
Net income attributable to AECOM		$	111,314			$	51,519			(53.7	%)
Net income attributable to AECOM per share:
Basic		$	0.70			$	0.33			(52.9	%)
Diluted		$	0.69			$	0.32			(53.6	%)
Weighted average shares outstanding:
Basic			157,909				156,416			(0.9	%)
Diluted			161,847				159,603			(1.4	%)

AECOM
Balance Sheet and Cash Flow Information
(unaudited - in thousands)
		September 30, 2018			December 31, 2018
Balance Sheet Information:
Total cash and cash equivalents		$	886,733		$	838,302
Accounts receivable and contract assets – net			5,468,821			5,545,622
Working capital			997,645			1,208,837
Total debt, excluding unamortized debt issuance costs			3,673,463			3,964,541
Total assets			14,681,131			14,767,650
Total AECOM stockholders’ equity			4,092,780			4,077,800

AECOM
Reportable Segments
(unaudited - in thousands)
		Design & Consulting Services								Construction Services						Management Services						AECOM Capital						Corporate				Total
Three Months Ended December 31, 2018
Revenue		$	2,029,679							$	2,014,502				$	989,381						$	3,933			$		-				$		5,037,495
Cost of revenue			1,914,040								2,011,286					941,556							-					-						4,866,882
Gross profit			115,639								3,216					47,825							3,933					-						170,613
Equity in earnings of joint ventures			3,900								7,823					3,266							(2,485	)				-						12,504
General and administrative expenses			-								-					-							(1,727	)				(34,180		)				(35,907	)
Restructuring costs			-								-					-							-					(63,295		)				(63,295	)
Income (loss) from operations		$	119,539							$	11,039				$	51,091						$	(279	)		$		(97,475		)		$		83,915
Gross profit as a % of revenue			5.7					%			0.2		%			4.8			%															3.4	%
Contracted backlog		$	9,108,093							$	8,309,265				$	3,274,519						$	-			$		-				$		20,691,877
Awarded backlog			7,079,149								13,903,114					15,076,223							-					-						36,058,486
Unconsolidated JV backlog			-								1,862,962					858,457							-					-						2,721,419
Total backlog		$	16,187,242							$	24,075,341				$	19,209,199						$	-			$		-				$		59,471,782
Three Months Ended December 31, 2017
Revenue		$	1,941,900							$	2,125,487				$	843,445						$	-			$		-				$		4,910,832
Cost of revenue			1,864,054								2,098,408					812,218							-					-						4,774,680
Gross profit			77,846								27,079					31,227							-					-						136,152
Equity in earnings of joint ventures			7,462								13,406					8,852							-					-						29,720
General and administrative expenses			-								-					-							(2,607	)				(32,063		)				(34,670	)
Income (loss) from operations		$	85,308							$	40,485				$	40,079						$	(2,607	)		$		(32,063		)		$		131,202
Gross profit as a % of revenue			4.0					%			1.3		%			3.7			%															2.8	%
Contracted backlog		$	8,605,057							$	11,666,660				$	3,118,359						$	-			$		-				$		23,390,076
Awarded backlog			7,863,929								5,030,502					9,140,923							-					-						22,035,354
Unconsolidated JV backlog			-								2,451,868					912,987							-					-						3,364,855
Total backlog		$	16,468,986							$	19,149,030				$	13,172,269						$	-			$		-				$		48,790,285

AECOM
Regulation G Information
($ in millions)
Reconciliation of Revenue to Amounts Provided by Acquired Companies
		Three Months Ended Dec 31, 2018
		Total			Provided by Acquired Companies			Excluding Effect of Acquired Companies
Revenue:
AECOM Consolidated		$	5,037.5		$	35.8		$	5,001.7
Design & Consulting Services			2,029.7			-			2,029.7
Construction Services			2,014.5			35.8			1,978.7
Management Services			989.4			-			989.4
AECOM Capital			3.9			-			3.9

Reconciliation of Net Income Attributable to AECOM to EBITDA and to Adjusted EBITDA
		Three months ended
		Dec 31, 2017				Sep 30, 2018				Dec 31, 2018
Net income attributable to AECOM		$	111.3			$	84.0			$	51.5
Income tax (benefit) expense			(47.1	)			18.8				(33.6	)
Income attributable to AECOM before income taxes			64.2				102.8				17.9
Depreciation and amortization expense 1			63.5				68.5				64.3
Interest income 2			(1.8	)			(2.1	)			(2.7	)
Interest expense 3			53.3				52.5				53.5
EBITDA			179.2				221.7				133.0
Non-core operating losses			-				17.5				15.0
Acquisition and integration related items			-				(4.4	)			(3.9	)
Restructuring costs			-				-				63.3
Loss on disposal activity			-				0.8				-
Depreciation expense included in non-core operating losses and acquisition and integration items above			-				(2.2	)			(0.2	)
Adjusted EBITDA		$	179.2			$	233.4			$	207.2

		Fiscal Years Ended Sep 30,
			2016				2017				2018
Net income attributable to AECOM		$	96.1			$	339.4			$	136.5
Income tax (benefit) expense			(37.9	)			7.7				(19.6	)
Income attributable to AECOM before income taxes			58.2				347.1				116.9
Depreciation and amortization expense 1			414.5				280.0				281.0
Interest income 2			(4.3	)			(5.5	)			(9.6	)
Interest expense 3			225.8				212.4				249.4
EBITDA			694.2				834.0				637.7
Non-core operating losses			36.9				9.4				57.4
Loss on assets held for sale, including goodwill			-				-				168.2
Acquisition and integration related items			213.6				38.7				(10.9	)
Loss (gain) on disposal activity			42.6				(0.6	)			2.9
FX gain from forward currency contract			-				-				(9.1	)
Depreciation expense included in non-core operating losses and acquisition and integration items above			(28.8	)			(0.8	)			(9.7	)
Adjusted EBITDA		$	958.5			$	880.7			$	836.5

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
		Dec 31, 2017			Sep 30, 2018			Dec 31, 2018
Short-term debt		$	2.4		$	8.4		$	46.1
Current portion of long-term debt			160.9			134.7			114.7
Long-term debt, gross			3,788.4			3,530.4			3,803.7
Total debt, excluding unamortized debt issuance costs			3,951.7			3,673.5			3,964.5
Less: Total cash and cash equivalents			813.2			886.7			838.3
Net Debt		$	3,138.5		$	2,786.8		$	3,126.2

Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow
		Three Months Ended
		Dec 31, 2017				Sep 30, 2018				Dec 31, 2018
Net cash provided by (used in) operating activities		$	52.4			$	531.9			$	(200.4	)
Capital expenditures, net			(18.5	)			(21.2	)			(21.9	)
Free Cash Flow		$	33.9			$	510.7			$	(222.3	)

		Fiscal Years Ended Sep 30,
			2015				2016				2017				2018
Net cash provided by operating activities		$	764.4			$	814.2			$	696.7			$	774.6
Capital expenditures, net			(69.4	)			(136.8	)			(78.5	)			(86.9	)
Free Cash Flow		$	695.0			$	677.4			$	618.2			$	687.7

AECOM
Regulation G Information
($ in millions, except per share data)
		Three Months Ended
		Dec 31, 2017				Sep 30, 2018				Dec 31, 2018
Reconciliation of Income from Operations to Adjusted Income from Operations
Income from operations		$	131.2			$	177.0			$	83.9
Non-core operating losses			-				17.5				15.0
Acquisition and integration related items			-				(4.8	)			(4.3	)
Restructuring costs			-				-				63.3
Loss on disposal activity			-				0.8				-
Amortization of intangible assets			26.9				27.4				25.7
Adjusted income from operations		$	158.1			$	217.9			$	183.6
Reconciliation of Income Before Income Taxes to Adjusted Income Before Income Taxes
Income before income tax (benefit) expense		$	77.3			$	124.1			$	31.5
Non-core operating losses			-				17.4				15.0
Acquisition and integration related items			-				(4.8	)			(4.3	)
Restructuring costs			-				-				63.3
Loss on disposal activity			-				0.8				-
Amortization of intangible assets			26.9				27.4				25.7
Financing charges in interest expense			2.9				2.9				2.4
Adjusted income before income tax (benefit) expense		$	107.1			$	167.8			$	133.6
Reconciliation of Income Taxes to Adjusted Income Taxes
Income tax (benefit) expense		$	(47.1	)		$	18.7			$	(33.6	)
Tax effect of the above adjustments*			5.4				9.4				28.5
Revaluation of deferred taxes and one-time tax repatriation charges associated with U.S. tax reform			41.7				6.1				1.5
Valuation allowances and other tax only items			-				(25.0	)			32.1
Adjusted income tax expense		$	-			$	9.2			$	28.5
Reconciliation of Noncontrolling Interest to Adjusted Noncontrolling Interests
Noncontrolling interests in income of consolidated subsidiaries, net of tax		$	(13.1	)		$	(21.4	)		$	(13.6	)
Acquisition and integration related items, net of tax			-				0.4				0.4
Amortization of intangible assets included in NCI, net of tax			(2.5	)			(3.3	)			(3.0	)
Adjusted noncontrolling interests in income of consolidated subsidiaries, net of tax		$	(15.6	)		$	(24.3	)		$	(16.2	)
Reconciliation of Net Income Attributable to AECOM to Adjusted Net Income Attributable to AECOM
Net income attributable to AECOM		$	111.3			$	84.0			$	51.5
Non-core operating losses			-				17.5				15.0
Acquisition and integration related items			-				(4.4	)			(3.9	)
Restructuring costs			-				-				63.3
Loss on disposal activity			-				0.8				-
Amortization of intangible assets			26.9				27.4				25.7
Financing charges in interest expense			2.9				2.9				2.4
Tax effect of the above adjustments *			(5.4	)			(9.4	)			(28.5	)
Revaluation of deferred taxes and one-time tax repatriation charges associated with U.S. tax reform			(41.7	)			(6.1	)			(1.5	)
Valuation allowances and other tax only items			-				25.0				(32.1	)
Amortization of intangible assets included in NCI, net of tax			(2.5	)			(3.3	)			(3.0	)
Adjusted net income attributable to AECOM		$	91.5			$	134.4			$	88.9
Reconciliation of Net Income per Diluted Share to Adjusted Net Income per Diluted Share
Net income attributable to AECOM - per diluted share		$	0.69			$	0.52			$	0.32
Per diluted share adjustments:
Non-core operating losses			-				0.11				0.09
Acquisition and integration related expenses			-				(0.03	)			(0.02	)
Restructuring costs			-				-				0.40
Amortization of intangible assets			0.17				0.17				0.16
Financing charges in interest expense			0.02				0.02				0.02
Tax effect of the above adjustments *			(0.03	)			(0.06	)			(0.18	)
Revaluation of deferred taxes and one-time tax repatriation charges associated with U.S. tax reform			(0.26	)			(0.03	)			(0.01	)
Valuation allowances and other tax only items			-				0.15				(0.20	)
Amortization of intangible assets included in NCI, net of tax			(0.02	)			(0.02	)			(0.02	)
Adjusted net income attributable to AECOM - per diluted shares		$	0.57			$	0.83			$	0.56
Weighted average shares outstanding - diluted			161.8				161.8				159.6

* Adjusts the income tax (benefit) expense during the period to exclude the impact on our effective tax rate of the pre-tax adjustments shown above.

AECOM
Regulation G Information
($ in millions, except per share data)
		Three Months Ended
		Dec 31, 2017				Sep 30, 2018				Dec 31, 2018
Reconciliation of EBITDA to Adjusted Income from Operations
EBITDA (1)		$	179.2			$	221.7			$	133.0
Non-core operating losses			-				17.5				15.0
Acquisition and integration related items			-				(4.4	)			(3.9	)
Restructuring costs			-				-				63.3
Loss on disposal activity			-				0.8				-
Depreciation expense included in non-core operating losses, and acquisition and integration expenses above			-				(2.2	)			(0.2	)
Adjusted EBITDA		$	179.2			$	233.4			$	207.2
Other income			(2.3	)			(2.6	)			(3.6	)
Interest income (2)			1.8				2.1				2.7
Depreciation (3)			(36.2	)			(39.3	)			(38.9	)
Noncontrolling interests in income of consolidated subsidiaries, net of tax			13.1				21.4				13.6
Acquisition and integration expenses related items included in NCI, net of tax			-				(0.4	)			(0.4	)
Amortization of intangible assets included in NCI, net of tax			2.5				3.3				3.0
Adjusted income from operations		$	158.1			$	217.9			$	183.6
(1) See Reconciliation of Net Income Attributable to AECOM to EBITDA and to Adjusted EBITDA. (2) Included in other income. (3) Excludes depreciation from non-core operating losses, and acquisition and integration expenses.
Reconciliation of Segment Income from Operations to Adjusted Income from Operations
Design & Consulting Services Segment:
Income from operations		$	85.3			$	126.4			$	119.5
Non-core operating losses			-				0.9				0.9
Amortization of intangible assets			6.2				5.8				6.0
Adjusted income from operations		$	91.5			$	133.1			$	126.4
Construction Services Segment:
Income from operations		$	40.5			$	21.3			$	11.0
Acquisition and integration related items			-				(4.8	)			(4.3	)
Non-core operating losses			-				16.6				14.1
Loss on disposal activity			-				0.8				-
Amortization of intangible assets			10.8				11.7				10.2
Adjusted income from operations		$	51.3			$	45.6			$	31.0
Management Services Segment:
Income from operations		$	40.1			$	49.9			$	51.1
Amortization of intangible assets			9.9				9.9				9.5
Adjusted income from operations		$	50.0			$	59.8			$	60.6

AECOM
Regulation G Information
FY19 GAAP EPS Guidance based on Adjusted EPS Guidance
		Fiscal Year End 2019
(all figures approximate)
GAAP EPS Guidance		$1.91 to $2.26
Adjusted EPS Excludes:
Amortization of intangible assets		$0.55
Acquisition and integration related items		($0.09)
FY19 restructuring		$0.50 to $0.55
Financing charges in interest expense		$0.06
Non-core operating losses		$0.09
Tax effect of the above items*		($0.28)
Tax expense associated with U.S. tax reform		($0.19)
Adjusted EPS Guidance		$2.60 to $2.90

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

FY19 GAAP Net Income Guidance based on Adjusted EBITDA Guidance
		Fiscal Year End 2019
(in millions, all figures approximate)
GAAP Net Income Attributable to AECOM Guidance*		$307 to $362
Adjusted Net Income Attributable to AECOM Excludes:
Amortization of intangible assets, net of NCI		$88
Acquisition and integration related items		($15)
FY19 restructuring		$80 to $90
Financing charges in interest expense		$10
Non-core operating losses		$15
Tax effect of the above items**		($46)
Tax expense associated with U.S. tax reform		($30)
Adjusted Net Income Attributable to AECOM		$420 to $465
Adjusted EBITDA Excludes:
Interest Expense		$204
Interest Income		($4)
Depreciation		$150
Taxes		$148
Adjusted EBITDA Guidance		$920 to $960

*Calculated based on the mid-point of AECOM’s fiscal year 2019 EPS guidance.

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

Note: the components in this table may not sum to the total due to rounding.

FY19 GAAP Tax Rate Guidance based on Adjusted Tax Rate Guidance
(all figures approximate)		Fiscal Year End 2019
GAAP Tax Rate Guidance		14%
Tax rate impact from adjustments to GAAP earnings		9%
Tax rate impact from inclusion of NCI deduction		2%
Effective Tax Rate for Adjusted Earnings Guidance		25%

FY19 GAAP Interest Expense Guidance based on Adjusted Interest Expense Guidance
		Fiscal Year End 2019
(in millions, all figures approximate)
GAAP Interest Expense Guidance		$214
Financing charge in interest expense		$10
Interest income		$4
Adjusted Interest Expense Guidance		$200

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