News Release
($ in millions, except EPS) | As Reported |
Adjusted |
||||
Revenue | $5,148 | - | ||||
Operating Income | $161 | $2021 | ||||
Net Income | $61 | $1011 | ||||
EPS (Fully Diluted) | $0.37 | $0.621 | ||||
Operating Cash Flow | $72 | - | ||||
Free Cash Flow | - | $482 | ||||
Backlog | $53,794 | - | ||||
Third Quarter 2018 Accomplishments:
- Organic4 revenue increased by 10% over the prior year, which marks the seventh consecutive quarter of positive organic growth, led by the higher-margin DCS and MS segments and growth in all three segments.
-
Adjusted EBITDA of
$223 million increased by 15% year-over-year after adjusting for the largeAECOM Capital gain in the prior-year quarter; sequential adjusted EBITDA growth of 11% was ahead of prior guidance for slight growth. -
Total backlog reached a new record of
$54 billion , a 16%3 increase over the prior year, which includes a continued favorable mix shift to the higher-margin DCS and MS segments. -
Wins of
$9.4 billion also set a new record, resulting in a 1.7x book-to-burn5 ratio, and included solid performance across the business. -
Delivered positive free cash flow2 for the 23rd
time in the past 25 quarters, and total debt declined by
$69 million ; cash flow was impacted due to working capital used to support 13% revenue growth, primarily from increased storm recovery work in theAmericas .
Prioritizing Stock Repurchases to Create Shareholder Value:
-
AECOM plans to commence its share repurchases ahead of its prior expectation by entering into a$150 million accelerated stock repurchase (ASR) once its trading window opens onAugust 9 th due to confidence in the strength of its business and outlook for its markets. -
The Company continues to believe its shares are undervalued and that
repurchases represent a compelling avenue to generate long-term value
for both
AECOM and its shareholders. -
Upon completion of the ASR, the Company intends to then deploy
substantially all free cash flow towards ongoing debt reduction and
repurchases under its
$1 billion Board authorization. - The Company reiterates its target net leverage6 of 2.5x, which it expects to achieve through a combination of ongoing debt reduction and EBITDA growth.
Strategic Decisions Update:
-
On
June 25 th, the Company completed the sale of itsCanadian Industrial Services Division and expects to complete the second non-core Oil & Gas business sale over the next several months. - Construction of the Alliant combined cycle gas power plant remains on schedule and budget.
“Our record revenue and all-time high backlog are evidence that our
design, build, finance, and operate vision, along with our leading scale
and broad geographic reach, are resulting in a differentiated
competitive offering and strong performance,” said
“Our strong third quarter results demonstrate the progress we are making
on our five-year financial plan through fiscal 2022 to deliver a 5%+
revenue CAGR, 7%+ adjusted EBITDA CAGR, 12-15% adjusted EPS CAGR, and at
least
Wins and Backlog
Wins were
Business Segments
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 third quarter was
Operating income was
Construction Services (CS)
The CS segment provides construction services for energy, sports, commercial, industrial, and public and private infrastructure clients.
Revenue in the third quarter was
Operating income was
Management Services (MS)
The MS segment provides program and facilities management and maintenance, training, logistics, consulting, technical assistance and systems-integration services and information technology services, primarily for agencies of the U.S. government, national governments around the world and commercial customers.
Revenue in the third quarter was
Operating income was
Tax Rate
The effective tax rate in the third quarter was 30.6%. On an adjusted basis, the effective tax rate was 26.0%. The adjusted tax rate was derived by re-computing the expected annual effective tax rate on earnings from adjusted net income.7 The adjusted tax expense differs from the GAAP tax expense based on the taxability or deductibility and tax rate applied to each of the adjustments.
Cash Flow
Operating cash flow for the third quarter was
Balance Sheet
As of
Financial Outlook
AECOM’s fiscal year 2018 financial guidance is as follows:
Fiscal Year 2018 Outlook | |||
Adjusted EBITDA1 | $880 million | ||
Adjusted EPS1 | $2.50 – $2.90 | ||
Free Cash Flow2 | $600+ million | ||
Interest Expense
(excluding amortization of deferred financing fees) |
$210 million | ||
Amortization8 | $105 million | ||
Full-Year Share Count | 162 million | ||
Effective Tax Rate for Adjusted Earnings7 | ~17% | ||
Capital Expenditures9 | $100 million | ||
Conference Call
1 Excluding acquisition and integration related items, financing charges in interest expense, foreign exchange gains, the amortization of intangible assets, financial impacts associated with expected and actual dispositions of non-core businesses and assets, and the revaluation of deferred taxes and one-time tax repatriation charge associated with U.S. tax reform. If an individual adjustment has no financial impact then the individual adjustment is not reflected in the Regulation G Information tables. See Regulation G Information for a reconciliation of Non-GAAP measures. |
2 Free cash flow is defined as cash flow from operations less capital expenditures net of proceeds from disposals. |
3 On a constant-currency basis. |
4 Organic growth is year-over-year at constant currency and excludes revenue associated with actual and planned non-core asset and business dispositions. Results expressed in constant currency are presented excluding the impact from changes in currency exchange rates. |
5 Book-to-burn ratio is defined as the amount of wins divided by revenue recognized during the period, including revenue related to work performed in unconsolidated joint ventures. |
6 Net debt-to-EBITDA is comprised of EBITDA as defined in the Company’s credit agreement, which excludes stock-based compensation, and net debt as defined as total debt on the Company’s financial statements, net of cash and cash equivalents. |
7 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 actual and planned dispositions of non-core businesses and assets. |
8 Amortization of intangible assets expense includes the impact of amortization included in equity in earnings of joint ventures and non-controlling interests. |
9 Capital expenditures, net of proceeds from disposals. |
About
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, cash flows, tax rate, share count, stock repurchases, interest expense, capital expenditures, amortization of intangible assets and financial fees, or other financial items, non-core Oil & Gas business sales, 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 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; we are dependent
on long-term government contracts and subject to uncertainties related
to government contract appropriations; governmental agencies may modify,
curtail or terminate our contracts; government contracts are subject to
audits and adjustments of contractual terms; impacts of the Tax Cuts and
Jobs Acts; we may experience losses under fixed-price contracts; we have
limited control over operations run through our joint venture entities;
we may be liable for misconduct by our employees or consultants or our
failure to comply with laws or regulations applicable to our business;
we may not maintain adequate surety and financial capacity; we are
highly leveraged and may not be able to service our debt and guarantees;
we have exposure to political and economic risks in different countries
where we operate as well as currency exchange rate fluctuations; we may
not be able to retain and recruit key technical and management
personnel; we may be subject to legal claims and we may have inadequate
insurance coverage; we are subject to environmental law compliance and
we may have inadequate nuclear indemnification; there may be unexpected
adjustments and cancellations related to our backlog; we are dependent
on partners and third parties who may fail to satisfy their obligations;
we may not be able to manage pension costs; we may face 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
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.
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 Statements of Income | ||||||||||||||||||||
(unaudited - in thousands, except per share data) | ||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||
June 30, |
June 30, 2018 |
% |
June 30, 2017 |
June 30, 2018 |
% |
|||||||||||||||
Revenue | $ | 4,561,467 | $ | 5,147,920 | 12.9% | $ | 13,347,014 | $ | 14,849,662 | 11.3% | ||||||||||
Cost of revenue | 4,386,291 | 4,962,741 | 13.1% | 12,833,421 | 14,387,059 | 12.1% | ||||||||||||||
Gross profit | 175,176 | 185,179 | 5.7% | 513,593 | 462,603 | (9.9)% | ||||||||||||||
Equity in earnings of joint ventures | 66,458 | 12,863 | (80.6)% | 109,667 | 55,621 | (49.3)% | ||||||||||||||
General and administrative expenses | (33,944 | ) | (35,159 | ) | 3.6% | (96,427 | ) | (100,046 | ) | 3.8% | ||||||||||
Impairment of assets held for sale, including goodwill | — | — | — | — | (168,178 | ) | NM | |||||||||||||
Acquisition & integration expenses | — | — | — | (35,409 | ) | — | (100.0)% | |||||||||||||
(Loss) gain on disposal activities | — | (2,149 | ) | NM | 572 | (2,149 | ) | (475.7)% | ||||||||||||
Income from operations | 207,690 | 160,734 | (22.6)% | 491,996 | 247,851 | (49.6)% | ||||||||||||||
Other income | 2,136 | 2,752 | 28.8% | 4,237 | 17,542 | 314.0% | ||||||||||||||
Interest expense | (61,547 | ) | (55,213 | ) | (10.3)% | (176,985 | ) | (211,955 | ) | 19.8% | ||||||||||
Income before income tax expense (benefit) | 148,279 | 108,273 | (27.0)% | 319,248 | 53,438 | (83.3)% | ||||||||||||||
Income tax expense (benefit) | 12,205 | 33,131 | 171.5% | 1,556 | (38,362 | ) | NM | |||||||||||||
Net income | 136,074 | 75,142 | (44.8)% | 317,692 | 91,800 | (71.1)% | ||||||||||||||
Noncontrolling interests in income of consolidated subsidiaries, net of tax | (34,747 | ) | (14,232 | ) | (59.0)% | (66,790 | ) | (39,309 | ) | (41.1)% | ||||||||||
Net income attributable to AECOM | $ | 101,327 | $ | 60,910 | (39.9)% | $ | 250,902 | $ | 52,491 | (79.1)% | ||||||||||
Net income attributable to AECOM per share: | ||||||||||||||||||||
Basic | $ | 0.65 | $ | 0.38 | (41.5)% | $ | 1.62 | $ | 0.33 | (79.6)% | ||||||||||
Diluted | $ | 0.64 | $ | 0.37 | (42.2)% | $ | 1.58 | $ | 0.32 | (79.7)% | ||||||||||
Weighted average shares outstanding: | ||||||||||||||||||||
Basic | 155,763 | 160,395 | 3.0% | 155,128 | 159,266 | 2.7% | ||||||||||||||
Diluted | 158,820 | 163,213 | 2.8% | 158,488 | 162,426 | 2.5% | ||||||||||||||
NM — not meaningful |
||||||||||||||||||||
Balance Sheet and Cash Flow Information | ||||||||
(unaudited - in thousands) | ||||||||
September 30, 2017 |
June 30, 2018 |
|||||||
Balance Sheet Information: | ||||||||
Total cash and cash equivalents | $ | 802,362 | $ | 801,419 | ||||
Accounts receivable – net | 5,127,743 | 5,447,985 | ||||||
Working capital | 1,103,843 | 1,153,772 | ||||||
Total debt, excluding unamortized debt issuance costs | 3,896,398 | 3,929,758 | ||||||
Total assets | 14,396,956 | 14,727,417 | ||||||
Total AECOM stockholders’ equity | 3,996,126 | 4,077,732 | ||||||
AECOM | ||||||||||||||||||||||||
Reportable Segments | ||||||||||||||||||||||||
(unaudited - in thousands) | ||||||||||||||||||||||||
|
Design & Consulting Services |
Construction Services |
Management Services |
AECOM Capital |
Corporate | Total | ||||||||||||||||||
Three Months Ended June 30, 2018 | ||||||||||||||||||||||||
Revenue | $ | 2,105,219 | $ | 2,106,720 | $ | 935,981 | $ | - | $ | - | $ | 5,147,920 | ||||||||||||
Cost of revenue | 1,989,093 | 2,097,586 | 876,062 | - | - | 4,962,741 | ||||||||||||||||||
Gross profit | 116,126 | 9,134 | 59,919 | - | - | 185,179 | ||||||||||||||||||
Equity in earnings of joint ventures | 4,275 | 2,276 | 6,312 | - | - | 12,863 | ||||||||||||||||||
General and administrative expenses | - | - | - | (3,682 | ) | (31,477 | ) | (35,159 | ) | |||||||||||||||
Loss on disposal activities | - | (2,149 | ) | - | - | - | (2,149 | ) | ||||||||||||||||
Income (loss) from operations | $ | 120,401 | $ | 9,261 | $ | 66,231 | $ | (3,682 | ) | $ | (31,477 | ) | $ | 160,734 | ||||||||||
Gross profit as a % of revenue | 5.5 | % | 0.4 | % | 6.4 | % | - | - | 3.6 | % | ||||||||||||||
Three Months Ended June 30, 2017 | ||||||||||||||||||||||||
Revenue | $ | 1,863,475 | $ | 1,841,620 | $ | 856,372 | $ | - | $ | - | $ | 4,561,467 | ||||||||||||
Cost of revenue | 1,772,240 | 1,815,467 | 798,584 | - | - | 4,386,291 | ||||||||||||||||||
Gross profit | 91,235 | 26,153 | 57,788 | - | - | 175,176 | ||||||||||||||||||
Equity in earnings of joint ventures | 2,371 | 7,022 | 8,638 | 48,427 | - | 66,458 | ||||||||||||||||||
General and administrative expenses | - | - | - | (2,147 | ) | (31,797 | ) | (33,944 | ) | |||||||||||||||
Income (loss) from operations | $ | 93,606 | $ | 33,175 | $ | 66,426 | $ | 46,280 | $ | (31,797 | ) | $ | 207,690 | |||||||||||
Gross profit as a % of revenue | 4.9 | % | 1.4 | % | 6.7 | % | - | - | 3.8 | % | ||||||||||||||
Nine Months Ended June 30, 2018 | ||||||||||||||||||||||||
Revenue | $ | 6,051,864 | $ | 6,120,549 | $ | 2,677,249 | $ | - | $ | - | $ | 14,849,662 | ||||||||||||
Cost of revenue | 5,737,658 | 6,097,631 | 2,551,770 | - | - | 14,387,059 | ||||||||||||||||||
Gross profit | 314,206 | 22,918 | 125,479 | - | - | 462,603 | ||||||||||||||||||
Equity in earnings of joint ventures | 14,500 | 16,890 | 24,231 | - | - | 55,621 | ||||||||||||||||||
General and administrative expenses | - | - | - | (9,169 | ) | (90,877 | ) | (100,046 | ) | |||||||||||||||
Loss on disposal activities | - | (2,149 | ) | - | - | - | (2,149 | ) | ||||||||||||||||
Impairment of assets held for sale, including goodwill | - | (168,178 | ) | - | - | - | (168,178 | ) | ||||||||||||||||
Income (loss) from operations | $ | 328,706 | $ | (130,519 | ) | $ | 149,710 | $ | (9,169 | ) | $ | (90,877 | ) | $ | 247,851 | |||||||||
Gross profit as a % of revenue | 5.2 | % | 0.4 | % | 4.7 | % | - | - | 3.1 | % | ||||||||||||||
Contracted backlog | $ | 9,326,176 | $ | 10,558,903 | $ | 3,212,884 | $ | - | $ | - | $ | 23,097,963 | ||||||||||||
Awarded backlog | 7,338,587 | 4,935,679 | 15,284,218 | - | - | 27,558,484 | ||||||||||||||||||
Unconsolidated JV backlog | - | 2,190,808 | 946,732 | - | - | 3,137,540 | ||||||||||||||||||
Total backlog | $ | 16,664,763 | $ | 17,685,390 | $ | 19,443,834 | $ | - | $ | - | $ | 53,793,987 | ||||||||||||
Nine Months Ended June 30, 2017 | ||||||||||||||||||||||||
Revenue | $ | 5,571,823 | $ | 5,324,561 | $ | 2,450,630 | $ | - | $ | - | $ | 13,347,014 | ||||||||||||
Cost of revenue | 5,279,322 | 5,264,199 | 2,289,900 | - | - | 12,833,421 | ||||||||||||||||||
Gross profit | 292,501 | 60,362 | 160,730 | - | - | 513,593 | ||||||||||||||||||
Equity in earnings of joint ventures | 12,578 | 16,596 | 32,066 | 48,427 | - | 109,667 | ||||||||||||||||||
General and administrative expenses | - | - | - | (6,594 | ) | (89,833 | ) | (96,427 | ) | |||||||||||||||
Acquisition & integration expenses | - | - | - | - | (35,409 | ) | (35,409 | ) | ||||||||||||||||
Gain on disposal activities | 572 | - | - | - | - | 572 | ||||||||||||||||||
Income (loss) from operations | $ | 305,651 | $ | 76,958 | $ | 192,796 | $ | 41,833 | $ | (125,242 | ) | $ | 491,996 | |||||||||||
Gross profit as a % of revenue | 5.2 | % | 1.1 | % | 6.6 | % | - | - | 3.8 | % | ||||||||||||||
Contracted backlog | $ | 8,523,849 | $ | 11,650,567 | $ | 3,376,912 | $ | - | $ | - | $ | 23,551,328 | ||||||||||||
Awarded backlog | 6,738,345 | 4,696,196 | 8,395,977 | - | - | 19,830,518 | ||||||||||||||||||
Unconsolidated JV backlog | - | 2,023,084 | 995,820 | - | - | 3,018,904 | ||||||||||||||||||
Total backlog | $ | 15,262,194 | $ | 18,369,847 | $ | 12,768,709 | $ | - | $ | - | $ | 46,400,750 | ||||||||||||
AECOM | |||||||||||||||||||
Regulation G Information | |||||||||||||||||||
($ in millions) | |||||||||||||||||||
Reconciliation of Revenue to Amounts Provided by Acquired Companies |
|||||||||||||||||||
Three Months Ended June 30, 2018 | Nine Months Ended June 30, 2018 | ||||||||||||||||||
Total |
Provided by |
Excluding |
Total |
Provided by |
Excluding |
||||||||||||||
Revenue: | |||||||||||||||||||
AECOM Consolidated | $ | 5,148.0 | $ | 129.0 | $ | 5,019.0 | $ | 14,849.7 | $ | 412.1 | $ | 14,437.6 | |||||||
Design & Consulting Services | 2,105.4 | - | 2,105.4 | 6,052.0 | - | 6,052.0 | |||||||||||||
Construction Services | 2,106.7 | 129.0 | 1,977.7 | 6,120.5 | 412.1 | 5,708.4 | |||||||||||||
Management Services | 935.9 | - | 935.9 | 2,677.2 | - | 2,677.2 | |||||||||||||
Reconciliation of Net Income Attributable to AECOM to EBITDA and to Adjusted EBITDA |
||||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||||
Jun 30, | Mar 31, | Jun 30, | Jun 30, | Jun 30, | ||||||||||||||||||
2017 | 2018 | 2018 | 2017 | 2018 | ||||||||||||||||||
Net income (loss) attributable to AECOM | $ | 101.3 | $ | (119.7 | ) | $ | 60.9 | $ | 250.9 | $ | 52.5 | |||||||||||
Income tax expense (benefit) | 12.1 | (24.4 | ) | 33.1 | 1.5 | (38.4 | ) | |||||||||||||||
Income (loss) attributable to AECOM before income taxes | 113.4 | (144.1 | ) | 94.0 | 252.4 | 14.1 | ||||||||||||||||
Depreciation and amortization expense1 | 67.4 | 81.0 | 68.0 | 206.0 | 212.5 | |||||||||||||||||
Interest income2 | (1.7 | ) | (3.4 | ) | (2.3 | ) | (3.7 | ) | (7.5 | ) | ||||||||||||
Interest expense3 | 58.5 | 90.9 | 52.7 | 161.6 | 196.9 | |||||||||||||||||
EBITDA | $ | 237.6 | $ | 24.4 | $ | 212.4 | $ | 616.3 | $ | 416.0 | ||||||||||||
Non-core operating losses | 3.2 | 21.2 | 18.7 | 5.7 | 39.9 | |||||||||||||||||
Loss on assets held for sale, including goodwill | - | 168.2 | - | - | 168.2 | |||||||||||||||||
Acquisition and integration related items | - | - | (6.5 | ) | 35.4 | (6.5 | ) | |||||||||||||||
Loss (gain) on disposal activities | - | - | 2.1 | (0.6 | ) | 2.1 | ||||||||||||||||
FX gain from forward currency contract | - | (9.1 | ) | - | - | (9.1 | ) | |||||||||||||||
Depreciation expense included in non-core operating losses and acquisition and integration items above | - | (3.8 | ) | (3.7 | ) | (0.8 | ) | (7.5 | ) | |||||||||||||
Adjusted EBITDA | $ | 240.8 | $ | 200.9 | $ | 223.0 | $ | 656.0 | $ | 603.1 | ||||||||||||
_____________________ |
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: | |||||||||
Jun 30, 2017 | Mar 31, 2018 | Jun 30, 2018 | |||||||
Short-term debt | $ | 1.7 | $ | 9.8 | $ | 47.4 | |||
Current portion of long-term debt | 155.4 | 123.9 | 125.6 | ||||||
Long-term debt, gross | 3,809.2 | 3,865.4 | 3,756.7 | ||||||
Total debt excluding unamortized debt issuance costs | 3,966.3 | 3,999.1 | 3,929.7 | ||||||
Less: Total cash and cash equivalents | 812.5 | 867.2 | 801.4 | ||||||
Net debt | $ | 3,153.8 | $ | 3,131.9 | $ | 3,128.3 | |||
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow |
||||||||||||||||||||||||||||||||
Three Months Ended | ||||||||||||||||||||||||||||||||
Sep 30, | Dec 31, | Mar 31, | Jun 30, | Sep 30, | Dec 31, | Mar 31, | Jun 30, | |||||||||||||||||||||||||
2016 | 2016 | 2017 | 2017 | 2017 | 2017 | 2018 | 2018 | |||||||||||||||||||||||||
Net cash provided by (used in) operating activities | $ | 362.9 | $ | 77.5 | $ | (46.1 | ) | $ | 413.9 | $ | 251.4 | $ | 52.4 | $ | 118.4 | $ | 71.9 | |||||||||||||||
Capital expenditures, net | (36.9 | ) | (21.0 | ) | (17.7 | ) | (19.8 | ) | (20.0 | ) | (18.5 | ) | (23.7 | ) | (23.5 | ) | ||||||||||||||||
Free cash flow | $ | 326.0 | $ | 56.5 | $ | (63.8 | ) | $ | 394.1 | $ | 231.4 | $ | 33.9 | $ | 94.7 | $ | 48.4 |
Fiscal Years Ended Sep 30, | |||||||||||||||||||||||||
2012 | 2013 | 2014 | 2015 | 2016 | 2017 | ||||||||||||||||||||
Net cash provided by operating activities | $ | 433.4 | $ | 408.6 | $ | 360.6 | $ | 764.4 | $ | 814.2 | $ | 696.7 | |||||||||||||
Capital expenditures, net | (62.9 | ) | (52.1 | ) | (62.8 | ) | (69.4 | ) | (136.8 | ) | (78.5 | ) | |||||||||||||
Free cash flow | $ | 370.5 | $ | 356.5 | $ | 297.8 | $ | 695.0 | $ | 677.4 | $ | 618.2 | |||||||||||||
AECOM | ||||||||||||||||||||
Regulation G Information | ||||||||||||||||||||
(in millions, except per share data) | ||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||
Jun 30, | Mar 31, | Jun 30, | Jun 30, | Jun 30, | ||||||||||||||||
2017 | 2018 | 2018 | 2017 | 2018 | ||||||||||||||||
Reconciliation of Income from Operations to Adjusted Income from Operations |
||||||||||||||||||||
Income (loss) from operations | $ | 207.7 | $ | (44.1 | ) | $ | 160.8 | $ | 492.0 | $ | 247.9 | |||||||||
Non-core operating losses | 3.2 | 21.2 | 18.5 | 5.7 | 39.7 | |||||||||||||||
Impairment of assets held for sale, including goodwill | - | 168.2 | - | - | 168.2 | |||||||||||||||
Acquisition and integration related items | - | - | (7.9 | ) | 35.4 | (7.9 | ) | |||||||||||||
Loss (gain) on disposal activities | - | - | 2.1 | (0.6 | ) | 2.1 | ||||||||||||||
Amortization of intangible assets | 28.4 | 33.7 | 28.4 | 83.5 | 89.0 | |||||||||||||||
Adjusted income from operations | $ | 239.3 | $ | 179.0 | $ | 201.9 | $ | 616.0 | $ | 539.0 | ||||||||||
Reconciliation of Income Before Income Taxes to Adjusted Income Before Income Taxes |
||||||||||||||||||||
Income (loss) before income tax benefit | $ | 148.2 | $ | (132.1 | ) | $ | 108.2 | $ | 319.2 | $ | 53.4 | |||||||||
Non-core operating losses | 3.2 | 21.2 | 18.6 | 5.7 | 39.8 | |||||||||||||||
Impairment of assets held for sale, including goodwill | - | 168.2 | - | - | 168.2 | |||||||||||||||
Acquisition and integration related items | - | - | (7.9 | ) | 35.4 | (7.9 | ) | |||||||||||||
Loss (gain) on disposal activities | - | - | 2.1 | (0.6 | ) | 2.1 | ||||||||||||||
Amortization of intangible assets | 28.4 | 33.7 | 28.4 | 83.5 | 89.0 | |||||||||||||||
FX gain from forward currency contract | - | (9.1 | ) | - | - | (9.1 | ) | |||||||||||||
Financing charges in interest expense | 2.9 | 44.2 | 2.6 | 14.4 | 49.7 | |||||||||||||||
Adjusted income before income tax expense (benefit) | $ | 182.7 | $ | 126.1 | $ | 152.0 | $ | 457.6 | $ | 385.2 | ||||||||||
Reconciliation of Income Taxes to Adjusted Income Taxes |
||||||||||||||||||||
Income tax expense (benefit) | $ | 12.1 | $ | (24.4 | ) | $ | 33.1 | $ | 1.5 | $ | (38.4 | ) | ||||||||
Tax effect of the above adjustments† |
10.5 | 26.6 | 2.3 | 34.8 | 34.3 | |||||||||||||||
Revaluation of deferred taxes and one-time tax repatriation charges associated with U.S. tax reform | - | - | - | - | 41.7 | |||||||||||||||
Adjusted income tax expense | $ | 22.6 | $ | 2.2 | $ | 35.4 | $ | 36.3 | $ | 37.6 | ||||||||||
† Adjusts the income tax expense (benefit) during the period to exclude the impact on our effective tax rate of the pre-tax adjustments shown above and the impact of the tax reform changes. |
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Reconciliation of Noncontrolling Interests to Adjusted Noncontrolling Interests |
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Noncontrolling interests in income of consolidated subsidiaries, net of tax | $ | (34.8 | ) | $ | (12.0 | ) | $ | (14.2 | ) | $ | (66.8 | ) | $ | (39.3 | ) | |||||
Acquisition and integration related items, net of tax | - | - | 1.4 | - | 1.4 | |||||||||||||||
Amortization of intangible assets included in NCI, net of tax | (2.1 | ) | (3.3 | ) | (2.8 | ) | (6.9 | ) | (8.6 | ) | ||||||||||
Adjusted noncontrolling interests in income of consolidated subsidiaries, net of tax |
$ | (36.9 | ) | $ | (15.3 | ) | $ | (15.6 | ) | $ | (73.7 | ) | $ | (46.5 | ) | |||||
Reconciliation of Net Income Attributable to AECOM to Adjusted Net Income Attributable to AECOM |
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Net income (loss) attributable to AECOM | $ | 101.3 | $ | (119.7 | ) | $ | 60.9 | $ | 250.9 | $ | 52.5 | |||||||||
Non-core operating losses | 3.2 | 21.2 | 18.5 | 5.7 | 39.7 | |||||||||||||||
Impairment of assets held for sale, including goodwill | - | 168.2 | - | - | 168.2 | |||||||||||||||
Acquisition and integration related items | - | - | (6.5 | ) | 35.4 | (6.5 | ) | |||||||||||||
Loss (gain) on disposal activities | - | - | 2.1 | (0.6 | ) | 2.1 | ||||||||||||||
Amortization of intangible assets | 28.4 | 33.7 | 28.4 | 83.5 | 89.0 | |||||||||||||||
FX gain from forward currency contract | - | (9.1 | ) | - | - | (9.1 | ) | |||||||||||||
Financing charges in interest expense | 2.9 | 44.2 | 2.6 | 14.4 | 49.7 | |||||||||||||||
Tax effect of the above adjustments† |
(10.4 | ) | (26.6 | ) | (2.3 | ) | (34.8 | ) | (34.3 | ) | ||||||||||
Revaluation of deferred taxes and one-time tax repatriation charges associated with U.S. tax reform | - | - | - | - | (41.7 | ) | ||||||||||||||
Amortization of intangible assets included in NCI, net of tax | (2.1 | ) | (3.3 | ) | (2.8 | ) | (6.9 | ) | (8.6 | ) | ||||||||||
Adjusted net income attributable to AECOM | $ | 123.3 | $ | 108.6 | $ | 100.9 | $ | 347.6 | $ | 301.0 | ||||||||||
|
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Reconciliation of Net Income per Diluted Share to Adjusted Net Income per Diluted Share |
||||||||||||||||||||
Net income (loss) attributable to AECOM – per diluted share | $ | 0.64 | $ | (0.75 | ) | $ | 0.37 | $ | 1.58 | $ | 0.32 | |||||||||
Per diluted share adjustments: | ||||||||||||||||||||
Non-core operating losses | 0.02 | 0.13 | 0.11 | 0.04 | 0.24 | |||||||||||||||
Impairment of assets held for sale, including goodwill | - | 1.04 | - | - | 1.04 | |||||||||||||||
Acquisition and integration related items | - | - | (0.04 | ) | 0.22 | (0.04 | ) | |||||||||||||
Loss on disposal activities | - | - | 0.01 | - | 0.01 | |||||||||||||||
Amortization of intangible assets | 0.18 | 0.21 | 0.18 | 0.53 | 0.55 | |||||||||||||||
FX gain from forward currency contract | - | (0.06 | ) | - | - | (0.06 | ) | |||||||||||||
Financing charges in interest expense | 0.02 | 0.27 | 0.02 | 0.09 | 0.31 | |||||||||||||||
Tax effect of the above adjustments† |
(0.07 | ) | (0.15 | ) | (0.01 | ) | (0.23 | ) | (0.21 | ) | ||||||||||
Revaluation of deferred taxes and one-time tax repatriation charges associated with U.S. tax reform | - | - | - | - | (0.26 | ) | ||||||||||||||
Amortization of intangible assets included in NCI, net of tax | (0.01 | ) | (0.02 | ) | (0.02 | ) | (0.04 | ) | (0.05 | ) | ||||||||||
Adjusted net income attributable to AECOM – per diluted share | $ | 0.78 | $ | 0.67 | $ | 0.62 | $ | 2.19 | $ | 1.85 | ||||||||||
Weighted average shares outstanding – diluted | 158.8 | 162.2 | 163.2 | 158.5 | 162.4 | |||||||||||||||
Reconciliation of EBITDA to Adjusted Income from Operations |
||||||||||||||||||||
EBITDA(1) | $ | 237.6 | $ | 24.4 | $ | 212.4 | $ | 616.3 | $ | 416.0 | ||||||||||
Non-core operating losses | 3.2 | 21.2 | 18.7 | 5.7 | 39.9 | |||||||||||||||
Impairment of assets held for sale, including goodwill | - | 168.2 | - | - | 168.2 | |||||||||||||||
Acquisition and integration related items | - | - | (6.5 | ) | 35.4 | (6.5 | ) | |||||||||||||
Loss (gain) on disposal activities | - | - | 2.1 | (0.6 | ) | 2.1 | ||||||||||||||
FX gain from forward currency contract | - | (9.1 | ) | - | - | (9.1 | ) | |||||||||||||
Depreciation expense included in non-core operating losses and acquisition and integration expenses above | - | (3.8 | ) | (3.7 | ) | (0.8 | ) | (7.5 | ) | |||||||||||
Adjusted EBITDA | $ | 240.8 | $ | 200.9 | $ | 223.0 | $ | 656.0 | $ | 603.1 | ||||||||||
Other income | (2.1 | ) | (12.5 | ) | (2.7 | ) | (4.2 | ) | (17.5 | ) | ||||||||||
FX gain from forward currency contract | - | 9.1 | - | - | 9.1 | |||||||||||||||
Interest income(2) | 1.7 | 3.4 | 2.3 | 3.7 | 7.5 | |||||||||||||||
Depreciation(3) | (38.0 | ) | (37.2 | ) | (36.3 | ) | (113.2 | ) | (109.7 | ) | ||||||||||
Noncontrolling interests in income of consolidated subsidiaries, net of tax | 34.8 | 12.0 | 14.2 | 66.8 | 39.3 | |||||||||||||||
Acquisition and integration related items included in NCI, net of tax | - | - | (1.4 | ) | - | (1.4 | ) | |||||||||||||
Amortization of intangible assets included in NCI, net of tax | 2.1 | 3.3 | 2.8 | 6.9 | 8.6 | |||||||||||||||
Adjusted income from operations | $ | 239.3 | $ | 179.0 | $ | 201.9 | $ | 616.0 | $ | 539.0 |
(1) See Reconciliation of Net Income Attributable to AECOM to EBITDA; (2) Included in other income; (3) Excludes depreciation from non-core operating losses, and acquisition and integration expenses |
AECOM | ||||||||||||||||||||
Regulation G Information | ||||||||||||||||||||
(in millions, except per share data) | ||||||||||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||||||||||
Jun 30, 2017 |
Mar 31, 2018 |
Jun 30, 2018 |
Jun 30, 2017 |
Jun 30, 2018 |
||||||||||||||||
Reconciliation of Segment Income from Operations to Adjusted Income from Operations |
||||||||||||||||||||
Design & Consulting Services Segment: | ||||||||||||||||||||
Income from operations | $ | 93.7 | $ | 123.0 | $ | 120.4 | $ | 305.7 | $ | 328.7 | ||||||||||
Non-core operating losses | 3.1 | 1.2 | 0.7 | 5.6 | 1.9 | |||||||||||||||
Gain on disposal activities | - | - | - | (0.6 | ) | - | ||||||||||||||
Amortization of intangible assets | 6.8 | 6.2 | 6.4 | 20.7 | 18.8 | |||||||||||||||
Adjusted income from operations | $ | 103.6 | $ | 130.4 | $ | 127.5 | $ | 331.4 | $ | 349.4 | ||||||||||
Construction Services Segment: | ||||||||||||||||||||
Income (loss) from operations | $ | 33.2 | $ | (180.3 | ) | $ | 9.3 | $ | 77.0 | $ | (130.5 | ) | ||||||||
Acquisition and integration related items | - | - | (7.9 | ) | - | (7.9 | ) | |||||||||||||
Non-core operating losses | - | 20.0 | 17.9 | - | 37.9 | |||||||||||||||
Impairment of assets held for sale, including goodwill | - | 168.2 | - | - | 168.2 | |||||||||||||||
Loss on disposal activities | - | - | 2.1 | - | 2.1 | |||||||||||||||
Amortization of intangible assets | 8.7 | 17.8 | 12.3 | 23.8 | 40.9 | |||||||||||||||
Adjusted income from operations | $ | 41.9 | $ | 25.7 | $ | 33.7 | $ | 100.8 | $ | 110.7 | ||||||||||
Management Services Segment: | ||||||||||||||||||||
Income from operations | $ | 66.4 | $ | 43.4 | $ | 66.2 | $ | 192.8 | $ | 149.7 | ||||||||||
Amortization of intangible assets | 12.9 | 9.7 | 9.7 | 39.0 | 29.3 | |||||||||||||||
Adjusted income from operations | $ | 79.3 | $ | 53.1 | $ | 75.9 | $ | 231.8 | $ | 179.0 | ||||||||||
AECOM | ||
Regulation G Information | ||
FY18 GAAP EPS Guidance based on Adjusted EPS Guidance |
||
|
||
Fiscal Year End 2018 | ||
GAAP EPS Guidance | $0.84 to $1.24 | |
Adjusted EPS Excludes: | ||
Amortization of intangible assets | $0.65 | |
Acquisition and integration related items | ($0.07) | |
Foreign exchange gain | ($0.06) | |
Financing charges in interest expense | $0.33 | |
Loss on disposal | $0.01 | |
Year-to-date non-core operating losses | $0.25 | |
Tax effect of the above items* | ($0.23) | |
Loss on assets held for sale, including goodwill | $1.04 | |
Revaluation of deferred taxes and one-time tax repatriation charges associated with U.S. tax reform | ($0.26) | |
Adjusted EPS Guidance | $2.50 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. |
FY18 GAAP Net Income Guidance based on Adjusted EBITDA Guidance |
||
Fiscal Year End 2018 | ||
(in millions) | ||
GAAP Net Income Attributable to AECOM Guidance* | $171 | |
Adjusted Net Income Attributable to AECOM Excludes: | ||
Amortization of intangible assets, net of NCI | $105 | |
Acquisition and integration related items | ($11) | |
Foreign exchange gain | ($9) | |
Financing charges in interest expense | $53 | |
Loss on disposal | $2 | |
Year-to-date non-core operating losses | $40 | |
Tax effect of the above items** | ($37) | |
Loss on assets held for sale, including goodwill | $168 | |
Revaluation of deferred taxes and one-time tax repatriation charges associated with U.S. tax reform | ($42) | |
Adjusted Net Income Attributable to AECOM | $440 | |
Adjusted EBITDA Excludes: | ||
Interest Expense | $210 | |
Interest Income | ($8) | |
Depreciation | $145 | |
Taxes | $92 | |
Adjusted EBITDA Guidance | $880 | |
*Calculated based on the mid-point of AECOM’s fiscal year 2018 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. |
FY18 GAAP Tax Rate Guidance based on Adjusted Tax Rate Guidance |
||
Fiscal Year End 2018 |
||
GAAP Tax Rate Guidance | 5% | |
Tax rate impact from adjustments to GAAP earnings | 10% | |
Tax rate impact from inclusion of NCI deduction | 2% | |
Effective Tax Rate for Adjusted Earnings Guidance | 17% | |
FY18 GAAP Interest Expense Guidance based on Adjusted Interest Expense Guidance |
||
Fiscal Year End 2018 |
||
(in millions) | ||
GAAP Interest Expense Guidance | $263 | |
Financing charge in interest expense | $53 | |
Adjusted Interest Expense Guidance | $210 | |
View source version on businesswire.com: https://www.businesswire.com/news/home/20180807005249/en/
Source:
AECOM
Investors:
Will Gabrielski, 213-593-8208
Vice
President, Investor Relations
William.Gabrielski@aecom.com
or
Media:
Brendan
Ranson-Walsh, 213-996-2367
Vice President, Global Communications &
Corporate Responsibility
Brendan.Ranson-Walsh@aecom.com