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AECOM reports fourth-quarter, full fiscal year 2011 results
Fourth-quarter EPS increased 29% year over year; organic revenue, net of other direct costs, grew 7% year over year
  • Fourth-quarter diluted earnings per share increased 29% year over year to 75 cents.
  • Net income attributable to AECOM for the fourth quarter increased 29% year over year to $87 million.
  • Operating income for the fourth quarter increased 35% year over year to $134 million.
  • Revenue, net of other direct costs, for the fourth quarter increased 20% year over year to $1.4 billion.
  • Revenue for the fourth quarter increased 16% year over year to $2.1 billion.
  • Cash flow from operations for the fourth quarter increased 128% year over year to $262 million.
  • Diluted earnings-per-share outlook of $2.45 to $2.65 provided for full fiscal year 2012.

LOS ANGELES, Nov 10, 2011 (BUSINESS WIRE) --

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 fourth quarter and full fiscal year ended Sept. 30, 2011.

AECOM reported net income attributable to AECOM of $87 million for the fourth quarter and diluted earnings per share (EPS) of 75 cents for the fourth quarter. This represents an increase of 29% over net income of $68 million for the same period last year and an increase of 29% over diluted earnings per share of 58 cents for the same period last year. Operating income for the fourth quarter increased 35% year over year to $134 million.

Fourth-quarter revenue was $2.1 billion, a 16% increase from the fourth quarter of fiscal year 2010. AECOM's gross revenue includes a significant amount of pass-through costs and, therefore, the company believes that revenue, net of other direct costs, which is a non-GAAP measure, also provides a valuable perspective on its business results. Fourth-quarter revenue, net of other direct costs, was $1.4 billion, representing a 20% increase over the same period last year. Organic revenue, net of other direct costs, for the fourth quarter increased 7% year over year.

For the full fiscal year 2011, AECOM reported net income attributable to AECOM of $276 million and diluted EPS of $2.33. This represents an increase of 16% over net income of $237 million for the same period last year and an increase of 14% over diluted EPS of $2.05 for the same period last year. Operating income for the full year increased 24% year over year to $421 million. For fiscal year 2011, the company's revenue, net of other direct costs, increased 23% to $5.2 billion, while revenue for fiscal year 2011 was $8.0 billion -- 23% higher than fiscal year 2010.

"Overall, 2011 was a good year for AECOM," said John M. Dionisio, AECOM chairman and chief executive officer. "During the year, we integrated a number of acquisitions, which strengthened our capabilities in important end markets, including construction, power, energy, mining, and cyber security and intelligence. This enabled us to deliver record new wins of $9.3 billion, backlog of $15.6 billion and earnings growth of 14%."

"We are poised for continued growth in 2012 with strong positions in the world's most robust and well-funded infrastructure markets," Dionisio added. "Looking ahead, we will focus our global resources on our best and most profitable opportunities across our diversified end markets and geographies. Finally, we will continue to focus on increasing cash flow and improving working capital and margins as well as effective capital allocation."

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 fourth quarter of fiscal year 2011, the PTS segment reported revenue of $1.9 billion and revenue, net of other direct costs, of $1.2 billion, compared to revenue of $1.5 billion and revenue, net of other direct costs, of $1.0 billion in the same period last year. This represents a 23% increase in revenue and an 18% increase in revenue, net of other direct costs. PTS segment operating income increased 22% from last year to $147 million.

For the full year, the PTS segment reported revenue of $6.9 billion and revenue, net of other direct costs, of $4.6 billion compared to revenue of $5.4 billion and revenue, net of other direct costs, of $3.8 billion last year. This represents an increase of 27% in revenue and a 20% increase in revenue, net of other direct costs, from last year. In addition, full year PTS segment operating income increased 11% from last year to $445 million.

Management Support Services

The MSS segment provides facilities management and maintenance, training, logistics, consulting, technical assistance and systems integration services, primarily for agencies of the U.S. government.

For the fourth quarter of fiscal year 2011, the MSS segment reported revenue of $235 million and revenue, net of other direct costs, of $147 million, compared to revenue of $294 million, and revenue, net of other direct costs, of $105 million for the same period during fiscal year 2010. This represents a 20% decrease in revenue contrasted by a 40% increase in revenue, net of other direct costs, highlighting a change in the mix of the business. In addition, the MSS segment reported operating income of $18 million compared to $12 million for the same period during fiscal year 2010, which represents a 56% year-over-year increase.

For the full year, the MSS segment reported revenue of $1.16 billion and operating income of $78 million. This represents an increase of 1% over revenue of $1.15 billion for fiscal year 2010 and an increase of 51% over operating income of $52 million for fiscal year 2010. For the full fiscal year 2011, MSS revenue, net of other direct costs, increased 55% to $569 million.

Cash Flow and Balance Sheet

Cash flow from operations for the fourth quarter of fiscal year 2011 increased by 128% from the prior year to $262 million. As of Sept. 30, 2011, AECOM had $457 million of total cash and cash equivalents, $1.2 billion of debt and $1.05 billion in committed bank facilities with $917 million in unused capacity.

Backlog

AECOM announced total backlog of $15.6 billion at Sept. 30, 2011, a 6% increase year over year. Excluding backlog obtained through acquisitions, total backlog increased 3% year over year. Foreign exchange rates negatively impacted backlog by $150 million during the fourth quarter.

Outlook

"AECOM continues to expand its presence in high-growth emerging and natural-resource-rich markets that now constitute over 40% of our net service revenue," said Michael S. Burke, AECOM president. "Overall, 59% of our net service revenue is derived from non-U.S. markets, providing us with confidence in our long-term outlook."

Building upon the progress achieved in the fiscal fourth quarter of 2011, AECOM expects diluted earnings per share results for fiscal year 2012 to be in the range of $2.45 to $2.65. The initial 2012 earnings guidance range includes the following key assumptions: 2012 tax rate of 29% (inclusive of non-controlling interest deduction), interest expense of $43 million, amortization of intangibles expense of $24 million, depreciation expense of $75 million, and full-year share count of 116 million.

The company will host a conference call at 10 a.m. Eastern Time, during which management will make a brief presentation focusing on the company's results, strategies and operating trends. Those wishing to dial in to the call via telephone can do so by dialing 1-866-543-6403 or 1-617-213-8896 and entering the passcode 70487053. Interested parties also can listen to the conference call and view accompanying slides via webcast at www.aecom.com. The webcast will be available for replay following the call.

About AECOM

AECOM is a global provider of professional technical and management support services to a broad range of markets, including transportation, facilities, environmental, energy, water and government. With approximately 45,000 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 create, enhance and sustain the world's built, natural, and social environments. A Fortune 500 company, AECOM serves clients in approximately 125 countries and had revenue of $8.0 billion during its fiscal year 2011. 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 Statement of Income
(in thousands, except per share data)
Three Months Ended Twelve Months Ended

September 30,
2011

September 30,
2010

September 30,
2011

September 30,
2010

Revenue $ 2,118,045 $ 1,828,658 $ 8,037,374 $ 6,545,791
Other direct costs 758,571 699,735 2,856,598 2,340,014
Revenue, net of other direct costs (non-GAAP) 1,359,474 1,128,923 5,180,776 4,205,777
Cost of revenue, net of other direct costs 1,207,634 1,004,589 4,702,627 3,775,506
Gross profit 151,840 124,334 478,149 430,271
Equity in earnings of joint ventures 13,144 7,217 44,819 20,987
General and administrative expenses 31,315 32,373 101,745 110,463
Income from operations 133,669 99,178 421,223 340,795
Other income (expense) 1,209 6,970 3,368 10,250
Interest income (expense), net (10,073 ) (5,442 ) (40,411 ) (9,928 )
Income from continuing operations
before income tax expense 124,805 100,706 384,180 341,117
Income tax expense 36,389 31,518 100,090 91,696
Income from continuing operations 88,416 69,188 284,090 249,421
Discontinued operations, net of tax - - - (77 )
Net income 88,416 69,188 284,090 249,344

Noncontrolling interest in income of consolidated
subsidiaries, net of tax

(1,033 ) (1,414 ) (8,290 ) (12,457 )
Net income attributable to AECOM $ 87,383 $ 67,774 $ 275,800 $ 236,887
Net income allocation:
Preferred stock dividend $ - $ 23 $ 2 $ 127

Net income available for common
stockholders

87,383 67,751 275,798 236,760
Net income attributable to AECOM $ 87,383 $ 67,774 $ 275,800 $ 236,887
Net income attributable to AECOM per share:
Basic
Continuing operations $ 0.75 $ 0.58 $ 2.35 $ 2.07
Discontinued operations - - - -
$ 0.75 $ 0.58 $ 2.35 $ 2.07
Diluted
Continuing operations $ 0.75 $ 0.58 $ 2.33 $ 2.05
Discontinued operations - - - -
$ 0.75 $ 0.58 $ 2.33 $ 2.05
Weighted average shares outstanding:
Basic 116,366 115,881 117,396 114,344
Diluted 117,080 116,690 118,345 115,463
AECOM Technology Corporation
Balance Sheet and Cash Flow Information
(in thousands)
September 30, 2011 September 30, 2010
Balance Sheet Information:
Cash and cash equivalents $ 456,940 $ 612,857
Accounts receivable - net 2,380,181 2,170,188
Working capital 1,172,586 1,094,239
Working capital, net of cash and cash equivalents 715,646 481,382
Total debt 1,162,469 931,127
Total assets 5,789,019 5,242,909
Total stockholders' equity 2,339,711 2,090,012
Twelve Months Ended
September 30, 2011 September 30, 2010
Cash Flow Information:
Net cash provided by (used in) operating activities* $ 132,021 $ 158,635

* September 30, 2011, amount includes deferred compensation plan termination ($90 million) and associated excess tax
benefits ($58 million).

AECOM Technology Corporation
Reportable Segments
(in thousands)

Professional
Technical
Services

Management
Support
Services

Corporate Total
Three Months Ended September 30, 2011
Revenue $ 1,882,896 $ 235,149 $ - $ 2,118,045
Other direct costs 670,049 88,522 - 758,571
Revenue, net of other direct costs (non-GAAP) 1,212,847 146,627 - 1,359,474
Cost of revenue, net of other direct costs 1,071,251 136,383 - 1,207,634
Gross profit 141,596 10,244 - 151,840
Equity in earnings of joint ventures 4,943 8,201 - 13,144
General and administrative expenses - - 31,315 31,315
Income from operations $ 146,539 $ 18,445 $ (31,315 ) $ 133,669
Gross profit as a % of revenue 7.5 % 4.4 % - 7.2 %

Gross profit as a % of revenue, net of other direct costs (non-
GAAP)

11.7 % 7.0 % - 11.2 %
Three Months Ended September 30, 2010
Revenue $ 1,534,539 $ 294,119 $ - $ 1,828,658
Other direct costs 510,188 189,547 - 699,735
Revenue, net of other direct costs (non-GAAP) 1,024,351 104,572 - 1,128,923
Cost of revenue, net of other direct costs 907,567 97,022 - 1,004,589
Gross profit 116,784 7,550 - 124,334
Equity in earnings of joint ventures 2,957 4,260 - 7,217
General and administrative expenses - - 32,373 32,373
Income from operations $ 119,741 $ 11,810 $ (32,373 ) $ 99,178
Gross profit as a % of revenue 7.6 % 2.6 % - 6.8 %

Gross profit as a % of revenue, net of other direct costs (non-
GAAP)

11.4 % 7.2 % - 11.0 %
AECOM Technology Corporation
Reportable Segments
(in thousands)

Professional
Technical
Services

Management
Support
Services

Corporate Total
Twelve Months Ended September 30, 2011
Revenue $ 6,877,131 $ 1,160,243 $ - $ 8,037,374
Other direct costs 2,264,940 591,658 - 2,856,598
Revenue, net of other direct costs (non-GAAP) 4,612,191 568,585 - 5,180,776
Cost of revenue, net of other direct costs 4,183,025 519,602 - 4,702,627
Gross profit 429,166 48,983 - 478,149
Equity in earnings of joint ventures 15,335 29,484 - 44,819
General and administrative expenses - - 101,745 101,745
Income from operations $ 444,501 $ 78,467 $ (101,745 ) $ 421,223
Gross profit as a % of revenue 6.2 % 4.2 % - 5.9 %

Gross profit as a % of revenue, net of other direct costs (non-
GAAP)

9.3 % 8.6 % - 9.2 %

Contracted backlog

$ 7,920,239 $ 960,539 $ - $ 8,880,778
Awarded backlog 5,723,540 999,555 - 6,723,095
Total backlog $ 13,643,779 $ 1,960,094 $ - $ 15,603,873
Twelve Months Ended September 30, 2010
Revenue $ 5,393,729 $ 1,152,062 $ - $ 6,545,791
Other direct costs 1,554,420 785,594 - 2,340,014
Revenue, net of other direct costs (non-GAAP) 3,839,309 366,468 - 4,205,777
Cost of revenue, net of other direct costs 3,449,486 326,020 - 3,775,506
Gross profit 389,823 40,448 - 430,271
Equity in earnings of joint ventures 9,484 11,503 - 20,987
General and administrative expenses - - 110,463 110,463
Income from operations $ 399,307 $ 51,951 $ (110,463 ) $ 340,795
Gross profit as a % of revenue 7.2 % 3.5 % - 6.6 %

Gross profit as a % of revenue, net of other direct costs (non-
GAAP)

10.2 % 11.0 % - 10.2 %

Contracted backlog

$ 6,130,587 $ 670,999 $ - $ 6,801,586
Awarded backlog 6,349,047 1,569,319 - 7,918,366
Total backlog $ 12,479,634 $ 2,240,318 $ - $ 14,719,952
AECOM Technology Corporation
Regulation G Information
(in millions)

Reconciliation of Revenue to Revenue, Net of Other Direct Costs

Three Months Ended Twelve Months Ended

September 30,
2011

September 30,
2010

September 30,
2011

September 30,
2010

Consolidated

Revenue $ 2,118.0 $ 1,828.7 $ 8,037.4 $ 6,545.8
Less: Other direct costs 758.5 699.8 2,856.6 2,340.0
Revenue, net of other direct costs $ 1,359.5 $ 1,128.9 $ 5,180.8 $ 4,205.8

PTS Segment

Revenue $ 1,882.9 $ 1,534.5 $ 6,877.1 $ 5,393.7
Less: Other direct costs 670.1 510.1 2,264.9 1,554.4
Revenue, net of other direct costs $ 1,212.8 $ 1,024.4 $ 4,612.2 $ 3,839.3

MSS Segment

Revenue $ 235.1 $ 294.2 $ 1,160.3 $ 1,152.1
Less: Other direct costs 88.4 189.7 591.7 785.6
Revenue, net of other direct costs $ 146.7 $ 104.5 $ 568.6 $ 366.5

Reconciliation of EBITDA to Net Income Attributable to AECOM

Three Months Ended
Sep 30, 2011 Sep 30, 2010
EBITDA $ 157.8 $ 125.8
Less: Interest (income) / expense* 8.9 5.3
Less: Depreciation and amortization 25.1 21.2
Income from continuing operations attributable to AECOM before income taxes 123.8 99.3
Less: Income tax expense 36.4 31.5
Income from continuing operations attributable to AECOM 87.4 67.8
Discontinued operations, net of tax - -
Net income attributable to AECOM $ 87.4 $ 67.8
Fiscal Years Ended September 30,
2011 2010 2009 2008
EBITDA $ 525.4 $ 417.5 $ 358.5 $ 284.5
Less: Interest (income) / expense* 39.2 9.9 10.7 (1.3 )
Less: Depreciation and amortization 110.3 78.9 84.1 62.8
Income from continuing operations attributable to AECOM before income taxes 375.9 328.7 263.7 223.0
Less: Income tax expense 100.1 91.7 77.0 76.5
Income from continuing operations attributable to AECOM 275.8 237.0 186.7 146.5
Discontinued operations, net of tax - (0.1 ) 3.0 0.7
Net income attributable to AECOM $ 275.8 $ 236.9 $ 189.7 $ 147.2

* Excluding related amortization.

NR 11-1102

SOURCE: AECOM Technology Corporation

AECOM
Paul Dickard, 646.432.8473
VP, External Communications
Paul.Dickard@aecom.com