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AECOM Reports 31% Growth in Diluted Earnings Per Share, Backlog of $9.0 Billion for First Quarter of Fiscal Year 2009

First-quarter diluted earnings per share of 38 cents, up 31% from the same period last year.

Net income for first quarter increased 37% year over year to $40.5 million.

Operating income for first quarter increased 57% year over year to $69.7 million.

Revenue for first quarter increased 35% year over year to $1.5 billion.

Revenue, net of other direct costs, for the first quarter increased 32% year over year to $889.5 million.

Backlog at December 31, 2008, increased 32% year over year to $9.0 billion.

Diluted earnings-per-share outlook reaffirmed at $1.60 to $1.70 for full fiscal year 2009.

LOS ANGELES--(BUSINESS WIRE)--Feb. 10, 2009-- 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 first quarter of fiscal year 2009, which ended December 31, 2008.

AECOM reported net income of $40.5 million for the first quarter, or diluted earnings per share (EPS) of 38 cents. These results represent an increase of 37% over net income of $29.5 million – and an increase of 31% over diluted EPS of 29 cents – for the same period last year. The net income amount does not include $0.4 million of earnings from discontinued operations associated with non-strategic assets acquired as part of the 2008 Earth Tech transaction, which AECOM intends to divest. Operating income for the first quarter increased 57% year over year to $69.7 million.

First-quarter revenue increased to $1.5 billion, 35% higher than the first quarter of fiscal year 2008. 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, increased 32% compared to the same period last year, to $889.5 million.

“Our solid first-quarter results reflect the benefits of AECOM’s diversified global business model,” said John M. Dionisio, AECOM president and chief executive officer. “During the quarter, we continued to expand our business in spite of a slowing demand in some of our commercial and private facilities markets. Overall, we saw continued strength and growth in our U.S. businesses as well as our non-U.S. operations. Looking forward, we believe that AECOM is well positioned to benefit from the implementation of stimulus programs around the world.”

“We saw continued demand for our services globally throughout the infrastructure market, and this was reflected in our backlog growth during the quarter,” said Dionisio. “Projects such as our work in support of Zayed University’s new campus in Abu Dhabi, major transit expansions in San Francisco and Toronto, and five task order wins for the U.S. Air Force’s Contract Field Teams program, 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 first quarter of fiscal year 2009, the PTS segment reported revenue of $1.2 billion and operating income of $76.9 million, compared to revenue of $893.4 million and operating income of $53.4 million for the same period during fiscal year 2008. This represents a 38% increase in revenue and a 44% increase in operating income year over year. PTS revenue, net of other direct costs, increased 30% to $846 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 first quarter of fiscal year 2009, the MSS segment reported revenue of $223 million and operating income of $10.0 million, compared to revenue of $187 million and operating income of $3.4 million for the same period during fiscal year 2008. This represents a 19% increase in revenue and a 194% increase in operating income year over year. The year over year comparison for MSS is positively impacted by an adjustment in the corresponding period last year that lowered award fees. MSS revenue, net of other direct costs, increased 60% to $43 million.

Backlog

AECOM announced backlog totaling $9.0 billion at December 31, 2008, a 32% increase year over year.

“We continued to effectively execute our growth strategy across our end markets and geographies during the first quarter,” said Michael S. Burke, AECOM executive vice president and chief financial officer.

“Our continued positive trends in margin improvement, where we saw a 107-basis-point improvement, and backlog growth, where we achieved a $2.2-billion increase in our year-over-year backlog, indicate continued solid momentum in our global end markets.”

Outlook

Based on its results through the first quarter of the fiscal year, as well as its backlog, AECOM has reaffirmed its EPS outlook for fiscal year 2009 of $1.60 to $1.70.

AECOM is hosting a conference call today at 11 a.m. EST, 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. Those wishing to dial in to the call via telephone can do so at (800) 218-4007 or (303) 205-0033.

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 43,000 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 $5.6 billion during the 12-month period ended December 31, 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 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
Reportable Segments
(in thousands)
       

Professional
Technical
Services

Management
Support
Services

Corporate Total
Three Months Ended December 31, 2008
Revenue $ 1,231,326 $ 222,802 $ - $ 1,454,128
Other direct costs   385,036     179,602     -     564,638  
Revenue, net of other direct costs 846,290 43,200 - 889,490
Cost of revenue, net of other direct costs   772,363     35,920     -     808,283  
Gross profit 73,927 7,280 - 81,207
Gross profit as a % of revenue 6.0 % 3.3 % - 5.6 %

Gross profit as a % of revenue, net of other direct
costs

8.7 % 16.9 % - 9.1 %
Equity in earnings of joint ventures 2,977 2,759 - 5,736
General and administrative expenses - - 17,246 17,246
Operating income 76,904 10,039 (17,246 ) 69,697
Segment assets 3,278,307 207,254 49,764 3,535,325
Contracted backlog 4,420,974 712,164 - 5,133,138
Awarded backlog 3,670,702 194,025 - 3,864,727
 
 
Three Months Ended December 31, 2007
Revenue $ 893,441 $ 186,809 $ - $ 1,080,250
Other direct costs   244,916     159,748     -     404,664  
Revenue, net of other direct costs 648,525 27,061 - 675,586
Cost of revenue, net of other direct costs   596,162     25,447     -     621,609  
Gross profit 52,363 1,614 - 53,977
Gross profit as a % of revenue 5.9 % 0.9 % - 5.0 %
Gross profit as a % of revenue, net of other direct
costs
8.1 % 6.0 % - 8.0 %
Equity in earnings of joint ventures 1,032 1,810 - 2,842
General and administrative expenses - - 12,287 12,287
Operating income 53,395 3,424 (12,287 ) 44,532
Contracted backlog 2,778,544 317,032 - 3,095,576
Awarded backlog 2,731,599 1,002,307 - 3,733,906
AECOM Technology Corporation
Condensed Consolidated Statement of Income
(in thousands, except per share data)
 
Three Months Ended
December 31, 2008 December 31, 2007
 
Revenue $ 1,454,128 $ 1,080,250
Other direct costs   564,638     404,664
Revenue, net of other direct costs 889,490 675,586
Cost of revenue, net of other direct costs   808,283     621,609
Gross profit 81,207 53,977
Equity in earnings of joint ventures 5,736 2,842
General and administrative expenses   17,246     12,287
Income from operations 69,697 44,532
Minority interest in share of earnings 3,446 1,279
Other expense 4,788 815
Interest income (expense) - net   (3,598 )   2,248
Income from continuing operations before income tax expense 57,865 44,686
Income tax expense   17,360     15,193
Income from continuing operations 40,505 29,493
Discontinued operations, net of tax   400     -
Net income $ 40,905   $ 29,493
 
Net income allocation:
Preferred stock dividend $ 36 $ 56
Net income available for common stockholders   40,869     29,437
Net income $ 40,905   $ 29,493
 
Net income per share:
Basic
Continuing operations $ 0.39 $ 0.30
Discontinued operations   -     -
$ 0.39   $ 0.30
 
Diluted
Continuing operations $ 0.38 $ 0.29
Discontinued operations   -     -
$ 0.38   $ 0.29
 
Weighted average shares outstanding:
Basic 104,529 99,644
Diluted 106,620 103,025

AECOM Technology Corporation

Balance Sheet and Cash Flow Information
(in thousands)
     
December 31, 2008 September 30, 2008
Balance Sheet Information:
Cash and cash equivalents $ 243,092 $ 194,522
Working capital 659,730 631,171
Working capital, net of cash and cash equivalents 416,638 436,649
Total debt 391,654 398,009
Total assets 3,535,325 3,596,190
Total stockholders’ equity 1,428,039 1,422,993
 
Three Months Ended
December 31, 2008 December 31, 2007
Cash Flow Information:
Net cash used in operating activities $ (12,565 ) $ (35,717 )

NR 09-0202

Source: AECOM Technology Corporation

AECOM Technology Corporation
Paul Gennaro, 212-973-3167
SVP & Chief Communications Officer
paul.gennaro@aecom.com