- EPS from ongoing operations $0.42,
up 2%
- Revenue from ongoing operations up
3%
- Backlog from ongoing operations up
5%
- Cash from ongoing operations up
87%
- Coffey Int’l. Ltd. joined Tetra Tech
on 1/18/16
Tetra Tech, Inc. (NASDAQ: TTEK) today announced results for the
fiscal 2016 first quarter ended December 27, 2015.
The following presents results from ongoing operations1 with
year-over-year comparisons on a constant currency basis. Revenue in
the quarter was $540 million, and revenue, net of subcontractor
costs2 (net revenue), was $414 million, up 3% and 2%, respectively,
in the first quarter of fiscal 2016 compared to the same period in
fiscal 2015. Operating income was $39 million and diluted earnings
per share (EPS) were $0.42, up 1% and 2%, respectively, compared to
the first quarter of fiscal 2015. Cash generated from operations
was $10 million, up 87% over the prior-year period. Backlog of $1.8
billion was up 5% year over year.
Acquisition of Coffey International
Limited
On January 18, 2016, Coffey International Limited
(Coffey) officially joined Tetra Tech. Founded in 1959 and
headquartered in Sydney, Australia, Coffey has a staff of 3,300
people delivering technical and engineering solutions in
international development and geoscience. Coffey significantly
expands Tetra Tech’s geographic presence, particularly in Australia
and Asia Pacific. For the most recent fiscal year ended June 30,
2015, Coffey reported revenue of approximately US$400 million.
Quarterly Dividend and Share Repurchase
Program
On January 25, 2016, Tetra Tech’s Board of Directors declared a
quarterly dividend of $0.08 per share payable on February 26, 2016
to stockholders of record as of February 12, 2016. Additionally,
the Company has $75 million remaining under the previously approved
$200 million share repurchase program.
Comments on Results
Tetra Tech’s Chairman and CEO Dan Batrack commented, “Tetra Tech
delivered solid performance for the first quarter of 2016 with
growth in revenue, operating income, and EPS from our ongoing
operations. Our cash flow from operations remained strong and we
continued to return capital to our shareholders through a
combination of dividends and share buybacks. In addition, we
welcomed Coffey to Tetra Tech last week, which expands our
geographic presence and advances us to a world-leading position in
international development. With a strong first quarter and the
addition of Coffey, we have increased guidance and look forward to
a successful 2016.”
Business Outlook
The following statements are based on current expectations.
These statements are forward-looking and the actual results could
differ materially. These statements do not include the potential
impact of transactions that may be completed or developments that
become evident after the date of this release. The Business Outlook
section should be read in conjunction with the information on
forward-looking statements at the end of this release.
Tetra Tech is increasing its guidance to include Coffey for
eight months of the fiscal year. Tetra Tech expects diluted EPS for
the second quarter of fiscal 2016 to be in the range of $0.33 to
$0.38. Net revenue for the second quarter is expected to range from
$425 million to $475 million. For the fiscal year 2016, diluted EPS
is expected to range from $1.75 to $1.95, and net revenue is
expected to range from $1.8 billion to $2.0 billion. Cash EPS3 is
expected to range from $2.70 to $3.00 for the full year.
Webcast
Investors will have the opportunity to access a live
audio-visual webcast and supplemental financial information
concerning the first quarter results through a link posted on the
Company’s website at tetratech.com on January 28, 2016 at 8:00 a.m.
(PST).
1 Refer to the Reconciliation of GAAP to Ongoing Operations
table.2 Tetra Tech’s revenue includes a significant amount of
subcontractor costs and, therefore, the Company believes revenue,
net of subcontractor costs, which is a non-GAAP financial measure,
provides a valuable perspective on its business results.3 Cash EPS
defined as cash flow from operations divided by diluted shares
outstanding. Cash EPS is a non-GAAP financial measure that provides
a valuable perspective on the Company’s financial results.
Reconciliation of GAAP to Ongoing Operations
In thousands (except EPS data) Three Months
Ended Dec. 27, 2015 Dec. 28, 2014
% Y/Y Revenue $ 560,708 $ 581,056 (4 )% RCM
(20,826 ) (34,430 ) – Ongoing revenue $ 539,882 $
546,626 (1 )% Foreign exchange (FX) 22,078 –
– Ongoing revenue, net of FX $ 561,960 $
546,626 3 % Net revenue $ 420,956 $ 437,080 (4 )% RCM
(7,190 ) (10,611 ) – Ongoing net revenue $
413,766 $ 426,469 (3 )% FX 19,868 – –
Ongoing net revenue, net of FX $ 433,634 $ 426,469
2 % Operating income $ 32,930 $ 36,612 (10 )%
Earn-out expense 1,001 – – RCM loss 5,282
3,420 – Ongoing operating income $ 39,213 $ 40,032 (2
%) FX 1,168 – – Ongoing
operating income, net of FX $ 40,381 $ 40,032 1 %
EPS $ 0.39 $ 0.41 (7 )% Earn-out expense 0.01 – – RCM loss
0.05 0.03 – Retroactive R&E tax credit (0.03 )
(0.02 ) – Ongoing EPS $ 0.42 $ 0.42 0 % FX 0.01
– – Ongoing EPS, net of FX $ 0.43
$ 0.42 2 %
About Tetra Tech
Tetra Tech is a leading provider of consulting and engineering
services. For 50 years, the Company has supported commercial and
government clients focused on water, environment, infrastructure,
resource management, energy, and international development. With
16,000 staff worldwide, Tetra Tech provides clear solutions to
complex problems. For more information about Tetra Tech, please
visit tetratech.com, follow us on Twitter (@TetraTech), or like us
on Facebook.
Forward-Looking Statements
This news release contains forward-looking statements that are
subject to the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements
include information concerning future events and the future
financial performance of Tetra Tech that involve risks and
uncertainties. Readers are cautioned that these forward-looking
statements are only predictions and may differ materially from
actual future events or results. Readers are urged to read the
documents filed by Tetra Tech with the SEC, specifically the most
recent reports on Form 10-K, 10-Q, and 8-K, each as it may be
amended from time to time, which identify risk factors that could
cause actual results to differ materially from the forward-looking
statements. Among the important factors or risks that could cause
actual results or events to differ materially from those in the
forward-looking statements in this release are: worldwide
political and economic uncertainties; fluctuations in annual
revenue, expenses, and operating results; the cyclicality in demand
for our overall services; the cyclicality in demand for mining
services; the cyclicality in demand for oil and gas services;
concentration of revenues from U.S. government agencies and
potential funding disruptions by these agencies; violations of U.S.
government contractor regulations; dependence on winning or
renewing U.S. government contracts; the delay or unavailability of
public funding on U.S. government contracts; the U.S. government’s
right to modify, delay, curtail or terminate contracts at its
convenience; credit risks associated with certain commercial
clients; risks associated with international operations; the
failure to comply with worldwide anti-bribery laws; the failure to
comply with domestic and international export laws; the failure to
properly manage projects; the loss of key personnel or the
inability to attract and retain qualified personnel; the use of
estimates and assumptions in the preparation of financial
statements; the ability to maintain adequate workforce utilization;
the use of the percentage-of-completion method of accounting; the
inability to accurately estimate and control contract costs; the
failure to adequately recover on our claims for additional contract
costs; the failure to win or renew contracts with private and
public sector clients; acquisition strategy and integration risks;
goodwill or other intangible asset impairment; growth strategy
management; backlog cancellation and adjustments; the failure of
partners to perform on joint projects; the failure of
subcontractors to satisfy their obligations; requirements to pay
liquidated damages based on contract performance; changes in
resource management, environmental, or infrastructure industry
laws, regulations, or programs; changes in capital markets and the
access to capital; credit agreement covenants; industry
competition; liability related to legal proceedings,
investigations, and disputes; the availability of third-party
insurance coverage; the ability to obtain adequate bonding;
employee, agent, or partner misconduct; employee risks related to
international travel; safety programs; conflict of interest issues;
liabilities relating to reports and opinions; liabilities relating
to environmental laws and regulations; force majeure events;
protection of intellectual property rights; the interruption of
systems and information technology; the ability to impede a
business combination based on Delaware law and charter documents;
and stock price volatility. Any projections in this release are
based on limited information currently available to Tetra Tech,
which is subject to change. Although any such projections and the
factors influencing them will likely change, Tetra Tech will not
necessarily update the information, since Tetra Tech will only
provide guidance at certain points during the year. Readers should
not place undue reliance on forward-looking statements since such
information speaks only as of the date of this release.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20160127006321/en/
Tetra Tech, Inc.Jim Wu, Investor RelationsCharlie MacPherson,
Media & Public Relations(626) 470-2844
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