AECOM reports second quarter fiscal year 2021 results
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AECOM reports second quarter fiscal year 2021 results

LOS ANGELES — (BUSINESS WIRE) — May 10, 2021 — AECOM (NYSE: ACM), the world’s premier infrastructure consulting firm, today reported second quarter fiscal year 2021 results.

 

Second Quarter Fiscal 2021

 

First Half Fiscal 2021

(from Continuing Operations;

$ in millions, except EPS)

As Reported

Adjusted1

(Non-GAAP)

As Reported YoY % Change

Adjusted YoY % Change

 

As Reported

Adjusted1

(Non-GAAP)

As Reported YoY % Change

Adjusted YoY % Change

Revenue

$3,266

--

1%

--

 

$6,579

--

2%

--

Net Service Revenue (NSR)2

--

$1,569

--

1%

 

--

$3,045

--

(2%)

Operating Income

$158

$172

43%

8%

 

$299

$331

51%

9%

Segment Operating Margin3 (NSR)

--

13.1%

--

+140 bps

 

--

13.1%

--

+140 bps

Net Income

$88

$100

82%

14%

 

$172

$195

116%

20%

EPS (Fully Diluted)

$0.59

$0.67

97%

22%

 

$1.13

$1.29

131%

28%

EBITDA4

--

$202

--

11%

 

--

$391

--

10%

Operating Cash Flow

$59

--

NM

--

 

$66

--

NM

--

Free Cash Flow5

--

$3

--

NM

 

--

($11)

--

NM

Backlog

$39,427

--

(5%)

--

 

 

 

 

 

Fiscal Second Quarter and First Half Fiscal 2021 Highlights

Cash Flow, Balance Sheet and Capital Allocation Update

Fiscal 2021 Financial Guidance

“I am proud of how our teams have come together against a backdrop defined by continued uncertainty and an uneven pace of recovery across the globe,” said Troy Rudd, AECOM’s chief executive officer. “Importantly, market conditions are improving, and our Think and Act Globally strategy is resulting in improved margin performance and earnings growth, and inspires confidence in our increased guidance for this year. As we look ahead, substantial COVID relief funding in the U.S., increasing tax receipts and improving global economic conditions have strengthened our clients’ budgets, resulting in accelerating award activity, strong wins in April and a growing pipeline of opportunities.”

“Our teams are collaborating to bring the full strength of our capabilities to bear for our clients around the world through the execution of our Think and Act Globally strategy,” said Lara Poloni, AECOM’s president. “We are ideally suited to capitalize on improving market conditions and to deliver long-term profitable growth, as underscored by ENR’s recent design rankings that reaffirmed our number one position in transportation and facilities and saw our position in water improve to number two. In addition, last month we launched our Sustainable Legacies strategy to best align our teams on the ESG opportunities apparent across our business – both internally through the advancement of our own industry-leading net zero and diversity commitments, as well as the opportunity, as the number one ranked environment firm, to advise leading public- and private-sector clients that are increasingly investing in their multi-decade sustainability initiatives.”

“I am very pleased with what we have accomplished in the first half of the fiscal year,” said Gaurav Kapoor, AECOM’s chief financial officer. “We made it a priority to deliver more balanced cash flow in the first half of the year when compared to prior years, and our results reflect strong execution against this priority. Additionally, the actions we have taken to strengthen our balance sheet are accreting immediate value to our shareholders and creating additional capital to invest in our teams, as well as enhancing our ability to consistently return capital to our shareholders.”

Business Segments

Americas

Revenue in the second quarter of $2.5 billion was effectively unchanged from the prior year and net service revenue2 of $924 million declined by 1%.

Operating income increased by 10% over the prior year to $155 million and on an adjusted basis1 operating income increased by 9% to $159 million. The adjusted operating margin on an NSR2 basis of 17.2% was a 160 basis point increase over the prior year and marks a record high for a fiscal second quarter. This performance reflects the benefits of the actions taken to enhance margins through a simplified operating structure and reduced real estate, as well as investments in technology and shared service centers to enhance project delivery efficiencies.

International

Revenue in the second quarter was $796 million, a 3% increase from the prior year. Net service revenue2 of $645 million increased by 3%. Market conditions are stabilizing and backlog increased by 16%.

Operating income increased by 28% over the prior year to $46 million. On an adjusted basis1, operating income increased by 26% to $47 million. The adjusted operating margin on an NSR2 basis increased by 130 basis points over the prior year to 7.3%, which set a new quarterly high and reflects a 510 basis point improvement since the beginning of fiscal 2019 when the Company began executing actions to improve margins, including consolidating real estate, implementing a streamlined overhead structure and exiting lower-returning markets and countries.

Discontinued Operations

In October 2020, the Company closed on the sale of its Power construction business and closed on the sale of the Civil construction business in January 2021. Results for discontinued operations included an approximately $39 million loss, primarily reflecting working capital adjustments related to the disposed of businesses.

Balance Sheet
As of March 31, 2021, AECOM had $935 million of total cash and cash equivalents, $2.1 billion of total debt, $1.2 billion of net debt and $1.13 billion in unused capacity under its $1.15 billion revolving credit facility. Gross leverage6 of 2.5x remains below the Company’s long-term leverage target of 3.0x.

Tax Rate
The effective tax rate was 27.4% in the second quarter. On an adjusted basis, the effective tax rate was 28.4%. The adjusted tax rate was derived by re-computing the 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.

Reiterated Long-Term Financial Targets
Following its strong performance in the first half of its fiscal year, AECOM reiterated its long-term financial targets, which include its target to more than double both adjusted1 EPS to at least $4.30 and free cash flow5 to at least $680 million from fiscal 2020 to fiscal 2024, as well as its target to achieve a 15%+ segment3 adjusted1 operating margin and 15%+ return on invested capital (ROIC)8 by fiscal 2024.

Conference Call
AECOM is hosting a conference call tomorrow May 11th at noon Eastern Time, 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 at https://investors.aecom.com. The webcast will be available for replay following the call.

1 Excludes the impact of non-operating items, such as non-core operating losses and transaction-related expenses, restructuring costs and other items. See Regulation G Information for a complete reconciliation of non-GAAP measures to the comparable GAAP measures.
2 Revenue, net of subcontractor and other direct costs.
3 Reflects segment operating performance, excluding AECOM Capital and G&A.
4 Net income before interest expense, tax expense, depreciation and amortization.
5 Free cash flow is defined as cash flow from operations less capital expenditures, net of proceeds from equipment disposals.
6 Gross leverage is comprised of EBITDA as defined in the Company’s credit agreement dated October 17, 2014, as amended, and total debt on the Company’s financial statements.
7 Inclusive of non-controlling interest deduction and adjusted for financing charges in interest expense, the amortization of intangible assets and is based on continuing operations.
8 Return on invested capital, or ROIC, is calculated as the sum of adjusted net income as presented in the Company’s Regulation G Information and interest expense, net of interest income, divided by average quarterly invested capital as defined as the sum of attributable shareholder’s equity and total debt, less cash and cash equivalents.

About AECOM
AECOM (NYSE: ACM) is the world’s premier infrastructure consulting firm, delivering professional services throughout the project lifecycle – from planning, design and engineering to program and construction management. On projects spanning transportation, buildings, water, energy and the environment, our public- and private-sector clients trust us to solve their most complex challenges. Our teams are driven by a common purpose to deliver a better world through our unrivaled technical expertise and innovation, a culture of equity, diversity and inclusion, and a commitment to environmental, social and governance priorities. AECOM is a Fortune 500 firm and its Professional Services business had revenue of $13.2 billion in fiscal year 2020. See how we deliver what others can only imagine at aecom.com and @AECOM.

Forward-Looking Statements
All statements in this communication other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including any statements of the plans, strategies and objectives for future operations, profitability, strategic value creation, coronavirus impacts, risk profile and investment strategies, and any statements regarding future economic conditions or performance, and the expected financial and operational results of AECOM. 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; impacts caused by the coronavirus and the related economic instability and market volatility, including the reaction of governments to the coronavirus, including any prolonged period of travel, commercial or other similar restrictions, the delay in commencement, or temporary or permanent halting of construction, infrastructure or other projects, requirements that we remove our employees or personnel from the field for their protection, and delays or reductions in planned initiatives by our governmental or commercial clients or potential clients; 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 leverage 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, IT outages and data privacy; risks associated with the benefits and costs of the Management Services transaction, including the risk that the expected benefits of the Management Services transaction or any contingent purchase price will not be realized within the expected time frame, in full or at all; 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. Any forward-looking statements are made as of the date hereof. We do not intend, and undertake no obligation, to update any forward-looking statement.

Non-GAAP Financial Information
This press release contains financial information calculated other than in accordance with U.S. generally accepted accounting principles (“GAAP”). The Company believes that non-GAAP financial measures such as adjusted EPS, adjusted EBITDA, adjusted net/operating income, adjusted tax rate, net service revenue and free cash flow provide a meaningful perspective on its business results as the Company utilizes this information to evaluate and manage the business. We use adjusted EBITDA, adjusted EPS, adjusted net/operating income and adjusted tax rate to exclude the impact of non-operating items, such as amortization expense, taxes and non-core operating losses to aid investors in better understanding our core performance results. We use free cash flow to represent the cash generated after capital expenditures to maintain our business. We present net service revenue to exclude subcontractor costs from revenue to provide investors with a better understanding of our operational performance. We present segment adjusted operating margin to reflect segment operating performance of our Americas and International segments, excluding AECOM Capital.

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.

AECOM
Consolidated Statements of Income
(unaudited - in thousands, except per share data)

 

 

Three Months Ended

 

Six Months Ended

 

 

 

March 31,
2020

 

March 31,
2021

 

%
Change

 

March 31,
2020

 

March 31,
2021

 

%
Change

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$

3,245,737

 

$

3,265,573

 

0.6 %

 

$

6,481,347

 

$

6,578,728

 

1.5 %

 

Cost of revenue

 

3,076,924

 

3,070,314

 

(0.2)%

 

6,146,734

 

6,199,099

 

0.9 %

 

Gross profit

 

168,813

 

195,259

 

15.7 %

 

334,613

 

379,629

 

13.5 %

 

Equity in earnings of joint ventures

 

13,505

 

7,157

 

(47.0)%

 

23,433

 

15,358

 

(34.5)%

 

General and administrative expenses

 

(41,037

)

(36,007

)

(12.3)%

 

(84,651

)

(74,367

)

(12.1)%

 

Restructuring costs

 

(31,213

)

(8,746

)

(72.0)%

 

(76,138

)

(21,784

)

(71.4)%

 

Income from operations

 

110,068

 

157,663

 

43.2 %

 

197,257

 

298,836

 

51.5 %

 

Other income

 

2,430

 

3,477

 

43.1 %

 

6,438

 

7,330

 

13.9 %

 

Interest expense

 

(37,111

)

(32,800

)

(11.6)%

 

(77,488

)

(63,451

)

(18.1)%

 

Income before income tax expense

 

75,387

 

128,340

 

70.2 %

 

126,207

 

242,715

 

92.3 %

 

Income tax expense

 

21,604

 

35,148

 

62.7 %

 

37,510

 

60,749

 

62.0 %

 

Income from continuing operations

 

53,783

 

93,192

 

73.3 %

 

88,697

 

181,966

 

105.2 %

 

Loss from discontinued operations

 

(130,749

)

(47,914

)

(63.4)%

 

(112,569

)

(103,666

)

(7.9)%

 

Net (loss) income

 

(76,966

)

45,278

 

(158.8)%

 

(23,872

)

78,300

 

(428.0)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to noncontrolling interests
from continuing operations

 

(5,243

)

(4,845

)

(7.6)%

 

(9,290

)

(10,259

)

10.4 %

 

Net income attributable to noncontrolling interests
from discontinued operations

 

(3,917

)

(1,074

)

(72.6)%

 

(12,360

)

(2,554

)

(79.3)%

 

Net income attributable to noncontrolling interests

 

(9,160

)

(5,919

)

(35.4)%

 

(21,650

)

(12,813

)

(40.8)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income attributable to AECOM from continuing operations

 

48,540

 

88,347

 

82.0 %

 

79,407

 

171,707

 

116.2 %

 

Net loss attributable to AECOM from discontinued operations

 

(134,666

)

(48,988

)

(63.6)%

 

(124,929

)

(106,220

)

(15.0)%

 

Net (loss) income attributable to AECOM

 

$

(86,126

)

$

39,359

 

(145.7)%

 

$

(45,522

)

$

65,487

 

(243.9)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net (loss) income attributable to AECOM
per share:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Continuing operations

 

$

0.31

 

$

0.60

 

93.5 %

 

$

0.50

 

$

1.15

 

130.0 %

 

Discontinued operations

 

 

(0.85

)

 

(0.33

)

(61.2)%

 

 

(0.79

)

 

(0.71

)

(10.1)%

 

Basic (loss) earnings per share

 

$

(0.54

)

$

0.27

 

(150.0)%

 

$

(0.29

)

$

0.44

 

(251.7)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Continuing operations

 

$

0.30

 

$

0.59

 

96.7 %

 

$

0.49

 

$

1.13

 

130.6 %

 

Discontinued operations

 

 

(0.84

)

 

(0.33

)

(60.7)%

 

 

(0.77

)

 

(0.70

)

(9.1)%

 

Diluted (loss) earnings per share

 

$

(0.54

)

$

0.26

 

(148.1)%

 

$

(0.28

)

$

0.43

 

(253.6)%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average shares outstanding:

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic

 

158,550

 

147,770

 

(6.8)%

 

157,941

 

149,597

 

(5.3)%

 

Diluted

 

160,718

 

149,519

 

(7.0)%

 

160,687

 

151,632

 

(5.6)%

 

NM — not meaningful

Balance Sheet Information
(unaudited - in thousands)

 

September 30, 2020

 

March 31, 2021

 

Balance Sheet Information:

 

 

 

 

Total cash and cash equivalents

$ 1,708,332

 

$ 934,906

 

Accounts receivable and contract assets – net

4,532,255

 

4,310,875

 

Working capital

1,439,912

 

656,529

 

Total debt, excluding unamortized debt issuance costs

2,085,017

 

2,126,553

 

Total assets

12,998,951

 

11,983,833

 

Total AECOM stockholders’ equity

3,292,558

 

2,822,969

 

AECOM

 

Reportable Segments

 

(unaudited - in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Americas

 

International

 

AECOM
Capital

 

Corporate

 

Total

 

Three Months Ended March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$ 2,468,401

 

$ 796,442

 

$ 730

 

$ -

 

$ 3,265,573

 

Cost of revenue

 

2,316,726

 

753,588

 

-

 

-

 

3,070,314

 

Gross profit

 

151,675

 

42,854

 

730

 

-

 

195,259

 

Equity in earnings of joint ventures

 

2,978

 

3,003

 

1,176

 

-

 

7,157

 

General and administrative expenses

 

-

 

-

 

(1,432

)

(34,575

)

(36,007

)

Restructuring costs

 

-

 

-

 

-

 

(8,746

)

(8,746

)

Income (loss) from operations

 

$ 154,653

 

$ 45,857

 

$ 474

 

$ (43,321

)

$ 157,663

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit as a % of revenue

 

6.1%

 

5.4%

 

-

 

-

 

6.0%

 

 

 

 

 

 

 

 

 

 

 

 

 

Three Months Ended March 31, 2020

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$ 2,475,694

 

$ 769,535

 

$ 508

 

$ -

 

$ 3,245,737

 

Cost of revenue

 

2,340,061

 

736,863

 

-

 

-

 

3,076,924

 

Gross profit

 

135,633

 

32,672

 

508

 

-

 

168,813

 

Equity in earnings of joint ventures

 

5,341

 

3,148

 

5,016

 

-

 

13,505

 

General and administrative expenses

 

-

 

-

 

(1,759

)

(39,278

)

(41,037

)

Restructuring costs

 

-

 

-

 

-

 

(31,213

)

(31,213

)

Income (loss) from operations

 

$ 140,974

 

$ 35,820

 

$ 3,765

 

$ (70,491

)

$ 110,068

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit as a % of revenue

 

5.5%

 

4.2%

 

--

 

--

 

5.2%

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended March 31, 2021

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$ 5,025,661

 

$ 1,552,053

 

$ 1,014

 

$ -

 

$ 6,578,728

 

Cost of revenue

 

4,728,954

 

1,470,145

 

-

 

-

 

6,199,099

 

Gross profit

 

296,707

 

81,908

 

1,014

 

-

 

379,629

 

Equity in earnings of joint ventures

 

4,385

 

6,011

 

4,962

 

-

 

15,358

 

General and administrative expenses

 

-

 

-

 

(3,361

)

(71,006

)

(74,367

)

Restructuring costs

 

-

 

-

 

-

 

(21,784

)

(21,784

)

Income (loss) from operations

 

$ 301,092

 

$ 87,919

 

$ 2,615

 

$ (92,790

)

$ 298,836

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit as a % of revenue

 

5.9%

 

5.3%

 

-

 

-

 

5.8%

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracted backlog

 

$ 15,138,981

 

$ 4,038,385

 

$ -

 

$ -

 

$ 19,177,366

 

Awarded backlog

 

18,779,481

 

1,084,276

 

-

 

-

 

19,863,757

 

Unconsolidated JV backlog

 

386,302

 

-

 

-

 

-

 

386,302

 

Total backlog

 

$ 34,304,764

 

$ 5,122,661

 

$ -

 

$ -

 

$ 39,427,425

 

 

 

 

 

 

 

 

 

 

 

 

 

Six Months Ended March 31, 2020

 

 

 

 

 

 

 

 

 

 

 

Revenue

 

$ 4,927,676

 

$ 1,552,630

 

$ 1,041

 

$ -

 

$ 6,481,347

 

Cost of revenue

 

4,652,611

 

1,494,123

 

-

 

-

 

6,146,734

 

Gross profit

 

275,065

 

58,507

 

1,041

 

-

 

334,613

 

Equity in earnings of joint ventures

 

11,770

 

5,984

 

5,679

 

-

 

23,433

 

General and administrative expenses

 

-

 

-

 

(4,178

)

(80,473

)

(84,651

)

Restructuring costs

 

-

 

-

 

-

 

(76,138

)

(76,138

)

Income (loss) from operations

 

$ 286,835

 

$ 64,491

 

$ 2,542

 

$ (156,611

)

$ 197,257

 

 

 

 

 

 

 

 

 

 

 

 

 

Gross profit as a % of revenue

 

5.6%

 

3.8%

 

-

 

-

 

5.2%

 

 

 

 

 

 

 

 

 

 

 

 

 

Contracted backlog

 

$ 13,512,174

 

$ 3,518,306

 

$ -

 

$ -

 

$ 17,030,480

 

Awarded backlog

 

22,907,354

 

897,933

 

-

 

-

 

23,805,287

 

Unconsolidated JV backlog

 

775,275

 

-

 

-

 

-

 

775,275

 

Total backlog

 

$ 37,194,803

 

$ 4,416,239

 

$ -

 

$ -

 

$ 41,611,042

 

AECOM

Regulation G Information

($ in millions)

 

Reconciliation of Revenue to Revenue, Net of Subcontractor and Other Direct Costs (NSR)

 

Three Months Ended

 

 

Six Months Ended

 

 

Mar 31,
2020

 

Dec 31,
2020

 

Mar 31,
2021

 

 

Mar 31,
2020

 

Mar 31,
2021

 

Americas

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

$

2,475.7

 

$

2,557.3

 

$

2,468.3

 

 

$

4,927.7

 

$

5,025.6

 

Less: Subcontractor and other direct costs

 

1,542.5

 

 

1,694.3

 

 

1,544.7

 

 

 

3,088.9

 

 

3,239.0

 

Revenue, net of subcontractor and other direct costs

$

933.2

 

$

863.0

 

$

923.6

 

 

$

1,838.8

 

$

1,786.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

International

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

$

769.5

 

$

755.6

 

$

796.5

 

 

$

1,552.6

 

$

1,552.1

 

Less: Subcontractor and other direct costs

 

143.2

 

 

142.6

 

 

151.8

 

 

 

292.7

 

 

294.4

 

Revenue, net of subcontractor and other direct costs

$

626.3

 

$

613.0

 

$

644.7

 

 

$

1,259.9

 

$

1,257.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Performance (excludes ACAP)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

$

3,245.2

 

$

3,312.9

 

$

3,264.8

 

 

$

6,480.3

 

$

6,577.7

 

Less: Subcontractor and other direct costs

 

1,685.7

 

 

1,836.9

 

 

1,696.5

 

 

 

3,381.6

 

 

3,533.4

 

Revenue, net of subcontractor and other direct costs

$

1,559.5

 

$

1,476.0

 

$

1,568.3

 

 

$

3,098.7

 

$

3,044.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Consolidated

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Revenue

$

3,245.7

 

$

3,313.2

 

$

3,265.5

 

 

$

6,481.3

 

$

6,578.7

 

Less: Subcontractor and other direct costs

 

1,685.7

 

 

1,836.9

 

 

1,696.5

 

 

 

3,381.6

 

 

3,533.4

 

Revenue, net of subcontractor and other direct costs

$

1,560.0

 

$

1,476.3

 

$

1,569.0

 

 

$

3,099.7

 

$

3,045.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Total Debt to Net Debt

 

 

Balances at:

 

 

Mar 31, 2020

 

Dec 31, 2020

 

Mar 31, 2021

 

Short-term debt

$ 27.2

 

$ 2.3

 

$ 4.7

 

Current portion of long-term debt

25.2

 

22.0

 

42.2

 

Long-term debt, gross

2,101.2

 

2,066.4

 

2,079.7

 

Total debt, excluding unamortized debt issuance costs

2,153.6

 

2,090.7

 

2,126.6

 

Less: Total cash and cash equivalents

1,135.1

 

1,044.7

 

934.9

 

Net debt

$ 1,018.5

 

$ 1,046.0

 

$ 1,191.7

 

 

 

 

 

 

 

 

               

Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow

 

 

Three Months Ended

 

Six Months Ended

 

 

Mar 31,
2020

 

Dec 31,
2020

 

Mar 31,
2021

 

Mar 31,
2020

 

Mar 31,
2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net cash (used in) provided by operating activities

$

(299.1

)

$

7.1

 

$

59.2

 

$

(506.0

)

$

66.3

 

Capital expenditures, net

 

(13.4

)

 

(21.3

)

 

(55.9

)

 

(44.5

)

 

(77.2

)

Free cash flow

$

(312.5

)

$

(14.2

)

$

3.3

 

$

(550.5

)

$

(10.9

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AECOM

 

Regulation G Information

 

($ in millions, except per share data)

 
         

 

Three Months Ended

 

Six Months Ended

 

 

Mar 31,
2020

 

Dec 31,
2020

 

Mar 31,
2021

 

Mar 31,
2020

 

Mar 31,
2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Income from Operations to Adjusted Income from Operations

 

Income from operations

$

110.1

 

$

141.2

 

$

157.6

 

$

197.3

 

$

298.8

 

Non-core operating losses & transaction related expenses

 

-

 

 

-

 

 

-

 

 

5.6

 

 

-

 

Accelerated depreciation of project management tool

 

11.3

 

 

-

 

 

-

 

 

11.3

 

 

-

 

Restructuring costs

 

31.2

 

 

13.0

 

 

8.8

 

 

76.1

 

 

21.8

 

Amortization of intangible assets

 

6.2

 

 

5.3

 

 

5.4

 

 

12.3

 

 

10.7

 

Adjusted income from operations

$

158.8

 

$

159.5

 

$

171.8

 

$

302.6

 

$

331.3

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Income from Continuing Operations Before Taxes to Adjusted Income from Continuing Operations Before Taxes

 

Income from continuing operations before tax expense

$

75.4

 

$

114.4

 

$

128.3

 

$

126.2

 

$

242.7

 

Non-core operating losses & transaction related expenses

 

-

 

 

-

 

 

-

 

 

5.6

 

 

-

 

Accelerated depreciation of project management tool

 

11.3

 

 

-

 

 

-

 

 

11.3

 

 

-

 

Restructuring costs

 

31.2

 

 

13.0

 

 

8.8

 

 

76.1

 

 

21.8

 

Amortization of intangible assets

 

6.2

 

 

5.3

 

 

5.4

 

 

12.3

 

 

10.7

 

Financing charges in interest expense

 

0.9

 

 

1.8

 

 

2.6

 

 

2.9

 

 

4.4

 

Adjusted income from continuing operations before tax expense

$

125.0

 

$

134.5

 

$

145.1

 

$

234.4

 

$

279.6

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Income Taxes for Continuing Operations to Adjusted Income Taxes for Continuing Operations

 

Income tax expense for continuing operations

$

21.6

 

$

25.6

 

$

35.1

 

$

37.5

 

$

60.7

 

Tax effect of the above adjustments*

 

11.4

 

 

5.5

 

 

4.6

 

 

26.6

 

 

10.1

 

Valuation allowances and other tax only items

 

(1.1

)

 

2.7

 

 

0.1

 

 

(1.5

)

 

2.8

 

Adjusted income tax expense for continuing operations

$

31.9

 

$

33.8

 

$

39.8

 

$

62.6

 

$

73.6

 


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

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income Attributable to Noncontrolling Interests from Continuing Operations to Adjusted Net Income Attributable to Noncontrolling Interests from Continuing Operations

 

Net income attributable to noncontrolling interests from continuing operations

$

(5.3

)

$

(5.4

)

$

(4.9

)

$

(9.3

)

$

(10.3

)

Amortization of intangible assets included in NCI, net of tax

 

(0.1

)

 

(0.1

)

 

(0.2

)

 

(0.2

)

 

(0.3

)

Adjusted net income attributable to noncontrolling interests from continuing operations

$

(5.4

)

$

(5.5

)

$

(5.1

)

$

(9.5

)

$

(10.6

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income Attributable to AECOM from Continuing Operations to Adjusted Net Income Attributable to AECOM from Continuing Operations

 

Net income attributable to AECOM from continuing operations

$

48.5

 

$

83.4

 

$

88.3

 

$

79.4

 

$

171.7

 

Non-core operating losses & transaction related expenses

 

-

 

 

-

 

 

-

 

 

5.6

 

 

-

 

Accelerated depreciation of project management tool

 

11.3

 

 

-

 

 

-

 

 

11.3

 

 

-

 

Restructuring costs

 

31.2

 

 

13.0

 

 

8.8

 

 

76.1

 

 

21.8

 

Amortization of intangible assets

 

6.2

 

 

5.3

 

 

5.4

 

 

12.3

 

 

10.7

 

Financing charges in interest expense

 

0.9

 

 

1.8

 

 

2.6

 

 

2.9

 

 

4.4

 

Tax effect of the above adjustments*

 

(11.5

)

 

(5.5

)

 

(4.6

)

 

(26.7

)

 

(10.1

)

Valuation allowances and other tax only items

 

1.1

 

 

(2.7

)

 

(0.1

)

 

1.5

 

 

(2.8

)

Amortization of intangible assets included in NCI, net of tax

 

(0.1

)

 

(0.1

)

 

(0.2

)

 

(0.2

)

 

(0.3

)

Adjusted net income attributable to AECOM from continuing operations

$

87.6

 

$

95.2

 

$

100.2

 

$

162.2

 

$

195.4

 


* 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.

 

AECOM

 

Regulation G Information

 

($ in millions, except per share data)

 
   
         

 

Three Months Ended

 

Six Months Ended

 

 

Mar 31,
2020

 

Dec 31,
2020

 

Mar 31,
2021

 

Mar 31,
2020

 

Mar 31,
2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Net Income Attributable to AECOM from Continuing Operations per Diluted Share to Adjusted Net Income Attributable to AECOM from Continuing Operations per Diluted Share

 

Net income attributable to AECOM from continuing operations per diluted share

$

0.30

 

$

0.54

 

$

0.59

 

$

0.49

 

$

1.13

 

Per diluted share adjustments:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Non-core operating losses & transaction related expenses

 

-

 

 

-

 

 

-

 

 

0.03

 

 

-

 

Accelerated depreciation of project management tool

 

0.07

 

 

-

 

 

-

 

 

0.07

 

 

-

 

Restructuring costs

 

0.19

 

 

0.09

 

 

0.06

 

 

0.47

 

 

0.14

 

Amortization of intangible assets

 

0.04

 

 

0.04

 

 

0.04

 

 

0.08

 

 

0.07

 

Financing charges in interest expense

 

0.01

 

 

0.01

 

 

0.02

 

 

0.02

 

 

0.03

 

Tax effect of the above adjustments*

 

(0.07

)

 

(0.04

)

 

(0.04

)

 

(0.16

)

 

(0.06

)

Valuation allowances and other tax only items

 

0.01

 

 

(0.02

)

 

-

 

 

0.01

 

 

(0.02

)

Adjusted net income attributable to AECOM from continuing operations per diluted share

$

0.55

 

$

0.62

 

$

0.67

 

$

1.01

 

$

1.29

 

Weighted average shares outstanding – basic

 

158.6

 

 

151.4

 

 

147.8

 

 

157.9

 

 

149.6

 

Weighted average shares outstanding – diluted

 

160.7

 

 

153.7

 

 

149.5

 

 

160.7

 

 

151.6

 


* 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.

 

 

Reconciliation of Net Income Attributable to AECOM from Continuing Operations to EBITDA to Adjusted EBITDA and to Adjusted Income from Operations

 

Net income attributable to AECOM from continuing operations

$

48.5

 

$

83.4

 

$

88.3

 

$

79.4

 

$

171.7

 

Income tax expense

 

21.6

 

 

25.6

 

 

35.1

 

 

37.5

 

 

60.7

 

Depreciation and amortization expense1

 

48.7

 

 

39.4

 

 

41.1

 

 

89.8

 

 

80.5

 

Interest income2

 

(3.6

)

 

(1.3

)

 

(1.2

)

 

(7.0

)

 

(2.5

)

Interest expense

 

37.1

 

 

30.7

 

 

32.8

 

 

77.4

 

 

63.5

 

Amortized bank fees included in interest expense

 

(1.3

)

 

(1.8

)

 

(2.6

)

 

(3.3

)

 

(4.4

)

EBITDA

$

151.0

 

$

176.0

 

$

193.5

 

$

273.8

 

$

369.5

 

Non-core operating losses & transaction related expenses

 

-

 

 

-

 

 

-

 

 

5.6

 

 

-

 

Restructuring costs

 

31.2

 

 

13.0

 

 

8.8

 

 

76.2

 

 

21.8

 

Adjusted EBITDA

$

182.2

 

$

189.0

 

$

202.3

 

$

355.6

 

$

391.3

 

Other income

 

(2.4

)

 

(3.9

)

 

(3.4

)

 

(6.4

)

 

(7.3

)

Depreciation1

 

(30.0

)

 

(32.4

)

 

(33.3

)

 

(63.1

)

 

(65.7

)

Interest income2

 

3.6

 

 

1.3

 

 

1.2

 

 

7.0

 

 

2.5

 

Noncontrolling interests in income of consolidated subsidiaries, net of tax

 

5.3

 

 

5.4

 

 

4.8

 

 

9.3

 

 

10.2

 

Amortization of intangible assets included in NCI,
net of tax

 

0.1

 

 

0.1

 

 

0.2

 

 

0.2

 

 

0.3

 

Adjusted income from operations

$

158.8

 

$

159.5

 

$

171.8

 

$

302.6

 

$

331.3

 


1 Excludes depreciation from discontinued operations, non-core operating losses, and accelerated depreciation of project management tool 2 Included in other income

 

                                                       

AECOM
Regulation G Information
(in millions, except per share data)

 

 

Three Months Ended

 

Six Months Ended

 

 

Mar 31,
2020

 

Dec 31,
2020

 

Mar 31,
2021

 

Mar 31,
2020

 

Mar 31,
2021

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Reconciliation of Segment Income from Operations to Adjusted Income from Operations

 

 

 

 

 

 

 

Americas Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

$

141.0

 

$

146.4

 

$

154.7

 

$

286.8

 

$

301.1

 

 

Amortization of intangible assets

 

4.8

 

 

4.3

 

 

4.4

 

 

9.5

 

 

8.7

 

 

Adjusted income from operations

$

145.8

 

$

150.7

 

$

159.1

 

$

296.3

 

$

309.8

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

International Segment:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

$

35.8

 

$

42.1

 

$

45.8

 

$

64.5

 

$

87.9

 

 

Non-core operating losses & transaction related expenses

 

-

 

 

-

 

 

-

 

 

(0.1

)

 

-

 

 

Amortization of intangible assets

 

1.4

 

 

1.0

 

 

1.0

 

 

2.8

 

 

2.0

 

 

Adjusted income from operations

$

37.2

 

$

43.1

 

$

46.8

 

$

67.2

 

$

89.9

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Segment Performance (excludes ACAP):

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income from operations

$

176.8

 

$

188.5

 

$

200.5

 

$

351.3

 

$

389.0

 

 

Non-core operating losses & transaction related expenses

 

-

 

 

-

 

 

-

 

 

(0.1

)

 

-

 

 

Amortization of intangible assets

 

6.2

 

 

5.3

 

 

5.4

 

 

12.3

 

 

10.7

 

 

Adjusted income from operations

$

183.0

 

$

193.8

 

$

205.9

 

$

363.5

 

$

399.7

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

                                                               

AECOM

Regulation G Information

 

FY2021 GAAP EPS Guidance based on Adjusted EPS Guidance

(all figures approximate)

Fiscal Year End 2021

 

GAAP EPS Guidance

 

$2.33 to $2.53

 

Adjusted EPS excludes:

 

 

 

Amortization of intangible assets

 

$0.13

 

Amortization of deferred financing fees

 

$0.05

 

Restructuring

 

$0.27

 

Tax effect of the above items

 

($0.13)

 

Adjusted EPS Guidance

 

$2.65 to $2.85

 

           

FY2021 GAAP Net Income Attributable to AECOM from Continuing Operations Guidance
based on Adjusted EBITDA Guidance

(in millions, all figures approximate)

Fiscal Year End 2021

 

GAAP net income attributable to AECOM from continuing operations guidance*

 

$350 to $380

 

Adjusted net income attributable to AECOM from continuing operations excludes:

 

 

 

Amortization of intangible assets

 

$20

 

Amortization of deferred financing fees

 

$7

 

Restructuring*

 

$40

 

Tax effect of the above items

 

($19)

 

Adjusted net income attributable to AECOM from continuing operations

 

$398 to $428

 

Adjusted EBITDA excludes:

 

 

 

Adjusted interest expense, net

 

$100

 

Depreciation

 

$132

 

Income tax expense

 

$160 to $170

 

Adjusted EBITDA Guidance

 

$790 to $830

 


* Calculated based on the mid-point of AECOM’s fiscal year 2021 EPS guidance.

 

               

FY2021 GAAP Interest Expense Guidance based on Adjusted Interest Expense Guidance

(in millions, all figures approximate)

Fiscal Year End 2021

 

GAAP Interest Expense Guidance

 

$111

 

Financing charges in interest expense

 

($7)

 

Interest income

 

($4)

 

Adjusted Interest Expense Guidance

 

$100

 

           

FY2021 GAAP Income from Operations as a % of Revenue Guidance based on Segment Adjusted Operating Income as a % of Net Service Revenue Guidance

(all figures approximate)

Fiscal Year End 2021

Income from operations as a % of revenue

 

4.7%

 

ACAP income from operations

 

(0.1)%

 

Corporate net expense

 

1.1%

 

Restructuring expenses*

 

0.3%

 

Subcontractor and other direct costs

 

7.0%

 

Amortization of intangible assets

 

0.2%

 

Segment adjusted operating income as a % of net service revenue

 

13.2%

 

         

FY2021 GAAP Operating Cash Flow Guidance based on Free Cash Flow Guidance

(in millions, all figures approximate)

Fiscal Year End 2021

 

Operating cash flow guidance

 

$535 to $735

 

Capital expenditures, net of proceeds from equipment disposals

 

($110)

 

Free cash flow guidance

 

$425 to $625

 


* Calculated based on the mid-point of AECOM’s fiscal year 2021 EPS guidance

Note: Variances in tables are due to rounding.

           

 



Contact:

Investor Contact:
Will Gabrielski
Senior Vice President, Finance, Treasurer
213.593.8208
Email Contact

Media Contact:
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Vice President, Global Communications & Corporate Responsibility
213.996.2367
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