DALLAS--(BUSINESS WIRE)--
Jacobs Engineering Group Inc. (NYSE:JEC) today announced its financial
results for the fourth quarter and fiscal year ended September 29, 2017.
Fiscal 2017 Highlights:
-
Q4 2017 net earnings of $94.1 million, or $0.78 per diluted share, and
fiscal 2017 net earnings of $293.7 million, or $2.42 per diluted share;
-
Q4 2017 adjusted net earnings of $118.3 million, or $0.98 per diluted
share, and fiscal 2017 adjusted net earnings of $392.2 million, or
$3.24 per diluted share;
-
Positive improvement in sequential revenue performance for the quarter
(up 5% over third quarter);
-
Record high backlog of $19.8 billion at year end, up $1.2 billion vs.
prior quarter and over $1.0 billion a year ago; total professional
services backlog is up $581 million from year end 2016;
-
Continued strong gross margin performance in Q4, contributing to 160
basis point annual improvement in 2017;
-
Continued strong cash flow from operations of $194 million in the
quarter, resulting in cash flow from operations totaling $575 million
for the year; and
-
On track to close CH2M acquisition mid-December 2017.
Commenting on the results for the fourth quarter and fiscal year 2017,
Steve Demetriou, Jacobs Chairman and CEO, said, “I am pleased with the
continued momentum and performance in our final quarter of fiscal 2017.
Results included sequential revenue growth, a significant increase in
backlog, and strong margin performance, all of which were aligned with
our strategic initiatives outlined in December of last year. This
organic growth momentum combined with the previously announced
acquisition of CH2M will further strengthen our position as a global
leader in providing innovative solutions to our clients. Importantly, we
remain confident that we will close the CH2M transaction before the end
of the year.”
Kevin Berryman, Jacobs CFO, added, "Our fourth quarter and
full year results demonstrate our success in our first year
implementation of our strategic plan. Growth is gaining traction, margin
has improved and cash flow has continued to be strong. We believe that
our positive momentum will continue into fiscal year 2018, with expected
adjusted EPS (excluding impacts from the CH2M acquisition) in the range
of $3.25-$3.60.”
Fourth Quarter Review
Jacobs reported net earnings of $94.1 million, or $0.78 per diluted
share, on revenues of $2.7 billion for the fourth quarter ended
September 29, 2017. This compares to net earnings of $29.6 million, or
$0.24 per diluted share, on revenues of $2.6 billion for the fourth
quarter ended September 30, 2016.
Jacobs’ net earnings for the fourth fiscal quarter of 2017 included
approximately $24.2 million, or $0.20 per diluted share, in after tax
charges comprised of:
-
$13.6 million, or $0.11 per diluted share, in after-tax Restructuring
and other charges, driven primarily by an acceleration in
restructuring activities associated with the Company’s announced
definitive agreement to acquire CH2M and, consistent with previous
guidance, final charges recognized in connection with the 2015
Restructuring, which was completed this quarter; and
-
after-tax charges of $10.6 million, or $0.09 per diluted share, in
professional fees and related costs associated with the CH2M
acquisition.
Jacobs’ net earnings for fourth fiscal quarter of 2016 results included
approximately $63 million, or $0.53 per diluted share, in after-tax
restructuring and other charges including:
-
after-tax charges of $36 million, or $0.30 per diluted share, in
connection with the 2015 Restructuring;
-
additional restructuring charges of $17 million, or $0.14 per diluted
share, as a result of our strategic decision to exit our French
operation and divest our French subsidiary; and
-
a non-cash write-down on an equity investment of $10 million, or $0.09
per diluted share.
Excluding the items mentioned above, Jacobs’ adjusted net earnings for
the fourth quarter ended September 29, 2017 totaled $118.3 million, or
$0.98 per diluted share, favorable in comparison to $93.1 million, or
$0.77 per diluted share, for the corresponding period for 2016.
Our fourth quarter U.S. GAAP and adjusted results include one-time net
tax and tax related benefit items of $8.0 million, or $0.07 per diluted
share, for fourth quarter 2017, and $4.1 million, or $0.03 per diluted
share, in net tax benefit and other items for fourth quarter fiscal 2016.
Fiscal Year Review
For the fiscal year ended September 29, 2017, the company reported net
earnings of $293.7 million, or $2.42 per diluted share, on revenues of
$10.0 billion. This compares to net earnings of $210.5 million, or $1.73
per diluted share, on revenues of $11.0 billion for the prior fiscal
year.
On an annual basis, the combined impact of the Restructuring and other
charges and the CH2M acquisition related costs was $98.5 million, or
$0.82 per diluted share, for 2017. The Restructuring and other charges
for 2016 amounted to $163.1 million, or $1.35 per diluted share.
On an annual basis, our adjusted net earnings excluding these items
amounted to $392.2 million after tax, or $3.24 per diluted share, for
fiscal 2017 and $373.6 million, or $3.08 per diluted share, for fiscal
2016.
For the full fiscal year 2017 and 2016, total one-time net benefits from
tax and other items included in our U.S. GAAP and adjusted results
amounted to $12.0 million after tax, or $0.10 per diluted share, and
$18.7 million after tax, or $0.16 per diluted share, respectively.
Jacobs is hosting a conference call at 9:00 A.M. CT on Tuesday, November
21, 2017, which it is webcasting live on the internet at www.jacobs.com.
Jacobs is one of the world's largest and most diverse providers of
full-spectrum technical, professional and construction services for
industrial, commercial and government organizations globally. The
Company employs over 54,000 people and operates in more than 25
countries around the world. For more information, visit www.jacobs.com.
Forward-Looking Statements
Certain statements contained in this press release constitute
forward-looking statements as such term is defined in Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended, and such statements are intended to be
covered by the safe harbor provided by the same. Statements made in this
press release that are not based on historical fact are forward-looking
statements, including statements regarding whether and when the proposed
transaction with CH2M will be consummated and the anticipated benefits
thereof. Although such statements are based on management's current
estimates and expectations, and currently available competitive,
financial, and economic data, forward-looking statements are inherently
uncertain, and you should not place undue reliance on such statements as
actual results may differ materially. We caution the reader that there
are a variety of risks, uncertainties and other factors that could cause
actual results to differ materially from what is contained, projected or
implied by our forward-looking statements. The potential risks and
uncertainties include, among others, the possibility that CH2M may be
unable to obtain required stockholder approval or that other conditions
to closing the transaction may not be satisfied, such that the
transaction will not close or that the closing may be delayed; general
economic conditions; the transaction may involve unexpected costs,
liabilities or delays; risks that the transaction disrupts current plans
and operations of the parties to the transaction; the ability to
recognize the benefits of the transaction; the amount of the costs,
fees, expenses and charges related to the transaction the outcome of any
legal proceedings related to the transaction; the occurrence of any
event, change or other circumstances that could give rise to the
termination of the transaction agreement. For a description of some
additional factors that may occur that could cause actual results to
differ from our forward-looking statements see our Annual Report on Form
10-K for the period ended September 30, 2016, and when filed with the
Securities and Exchange Commission (the “SEC”), our Annual Report on
Form 10-K for the year ended September 29, 2017, and in particular the
discussions contained under Item 1 - Business; Item 1A - Risk Factors;
Item 3 - Legal Proceedings; and Item 7 - Management's Discussion and
Analysis of Financial Condition and Results of Operations, as well as
the Company’s other filings with the Securities and Exchange Commission.
Neither the Company nor CH2M is under any duty to update any of the
forward-looking statements after the date of this press release to
conform to actual results, except as required by applicable law.
Financial Highlights:
Results of Operations (in thousands, except
per-share data):
|
|
|
|
|
Three Months Ended
|
|
|
|
|
Year Ended
|
|
|
|
|
|
|
September 29, 2017
|
|
|
|
|
September 30, 2016
|
|
|
|
|
September 29, 2017
|
|
|
|
|
September 30, 2016
|
|
|
Revenues
|
|
|
|
$
|
2,653,865
|
|
|
|
|
$
|
2,640,587
|
|
|
|
|
$
|
10,022,788
|
|
|
|
|
$
|
10,964,157
|
|
|
Costs and Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Direct cost of contracts
|
|
|
|
|
(2,179,575
|
)
|
|
|
|
|
(2,208,895
|
)
|
|
|
|
|
(8,250,536
|
)
|
|
|
|
|
(9,196,326
|
)
|
|
Selling, general and administrative expenses
|
|
|
|
|
(367,298
|
)
|
|
|
|
|
(348,881
|
)
|
|
|
|
|
(1,379,983
|
)
|
|
|
|
|
(1,429,233
|
)
|
|
Operating Profit
|
|
|
|
|
106,992
|
|
|
|
|
|
82,811
|
|
|
|
|
|
392,269
|
|
|
|
|
|
338,598
|
|
|
Other Income (Expense):
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
|
|
3,051
|
|
|
|
|
|
2,740
|
|
|
|
|
|
8,748
|
|
|
|
|
|
7,848
|
|
|
Interest expense
|
|
|
|
|
(708
|
)
|
|
|
|
|
(4,945
|
)
|
|
|
|
|
(12,035
|
)
|
|
|
|
|
(15,260
|
)
|
|
Gain/(Loss) on disposal of business and investments
|
|
|
|
|
10,880
|
|
|
|
|
|
(41,410
|
)
|
|
|
|
|
10,880
|
|
|
|
|
|
(41,410
|
)
|
|
Miscellaneous expense, net
|
|
|
|
|
(766
|
)
|
|
|
|
|
(3,523
|
)
|
|
|
|
|
(6,645
|
)
|
|
|
|
|
(3,053
|
)
|
|
Total other income (expense), net
|
|
|
|
|
12,457
|
|
|
|
|
|
(47,138
|
)
|
|
|
|
|
948
|
|
|
|
|
|
(51,875
|
)
|
|
Earnings Before Taxes
|
|
|
|
|
119,449
|
|
|
|
|
|
35,673
|
|
|
|
|
|
393,217
|
|
|
|
|
|
286,723
|
|
|
Income Tax Expense
|
|
|
|
|
(26,021
|
)
|
|
|
|
|
(5,790
|
)
|
|
|
|
|
(105,842
|
)
|
|
|
|
|
(72,208
|
)
|
|
Net Earnings of the Group
|
|
|
|
|
93,428
|
|
|
|
|
|
29,883
|
|
|
|
|
|
287,375
|
|
|
|
|
|
214,515
|
|
|
Net Earnings (Loss) Attributable to Non-controlling Interests
|
|
|
|
|
714
|
|
|
|
|
|
(239
|
)
|
|
|
|
|
6,352
|
|
|
|
|
|
(4,052
|
)
|
|
Net Earnings Attributable to Jacobs
|
|
|
|
$
|
94,142
|
|
|
|
|
$
|
29,644
|
|
|
|
|
$
|
293,727
|
|
|
|
|
$
|
210,463
|
|
|
Net Earnings Per Share:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
|
|
$
|
0.78
|
|
|
|
|
$
|
0.25
|
|
|
|
|
$
|
2.43
|
|
|
|
|
$
|
1.75
|
|
|
Diluted
|
|
|
|
$
|
0.78
|
|
|
|
|
$
|
0.24
|
|
|
|
|
$
|
2.42
|
|
|
|
|
$
|
1.73
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Segment Information (in thousands):
|
|
|
|
|
Three Months Ended
|
|
|
|
|
Year Ended
|
|
|
|
|
|
September 29, 2017
|
|
|
|
|
September 30, 2016
|
|
|
|
|
September 29, 2017
|
|
|
|
|
September 30, 2016
|
|
Revenues from External Customers:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aerospace & Technology
|
|
|
|
$
|
620,706
|
|
|
|
|
$
|
649,993
|
|
|
|
|
$
|
2,360,613
|
|
|
|
|
$
|
2,657,433
|
|
Buildings & Infrastructure
|
|
|
|
|
639,211
|
|
|
|
|
|
557,508
|
|
|
|
|
|
2,452,321
|
|
|
|
|
|
2,253,512
|
|
Industrial
|
|
|
|
|
727,877
|
|
|
|
|
|
749,061
|
|
|
|
|
|
2,743,662
|
|
|
|
|
|
2,793,713
|
|
Petroleum & Chemicals
|
|
|
|
|
666,071
|
|
|
|
|
|
684,025
|
|
|
|
|
|
2,466,192
|
|
|
|
|
|
3,259,499
|
|
Total
|
|
|
|
$
|
2,653,865
|
|
|
|
|
$
|
2,640,587
|
|
|
|
|
$
|
10,022,788
|
|
|
|
|
$
|
10,964,157
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
Year Ended
|
|
|
|
|
|
|
September 29, 2017
|
|
|
|
|
September 30, 2016
|
|
|
|
|
September 29, 2017
|
|
|
|
|
September 30, 2016
|
|
|
Operating Profit:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aerospace & Technology
|
|
|
|
$
|
55,861
|
|
|
|
|
$
|
46,947
|
|
|
|
|
$
|
202,595
|
|
|
|
|
$
|
203,808
|
|
|
Buildings & Infrastructure (1)
|
|
|
|
|
54,499
|
|
|
|
|
|
41,564
|
|
|
|
|
|
193,455
|
|
|
|
|
|
174,648
|
|
|
Industrial
|
|
|
|
|
33,714
|
|
|
|
|
|
13,052
|
|
|
|
|
|
115,262
|
|
|
|
|
|
81,268
|
|
|
Petroleum & Chemicals
|
|
|
|
|
25,532
|
|
|
|
|
|
34,410
|
|
|
|
|
|
113,858
|
|
|
|
|
|
126,604
|
|
|
Total Segment Operating Profit
|
|
|
|
|
169,606
|
|
|
|
|
|
135,973
|
|
|
|
|
|
625,170
|
|
|
|
|
|
586,328
|
|
|
Other Corporate Expenses
|
|
|
|
|
(25,975
|
)
|
|
|
|
|
(1,926
|
)
|
|
|
|
|
(81,595
|
)
|
|
|
|
|
(60,100
|
)
|
|
Restructuring and Other Charges
|
|
|
|
|
(19,539
|
)
|
|
|
|
|
(51,236
|
)
|
|
|
|
|
(134,206
|
)
|
|
|
|
|
(187,630
|
)
|
|
CH2M Professional Fees and Integration costs
|
|
|
|
|
(17,100
|
)
|
|
|
|
|
—
|
|
|
|
|
|
(17,100
|
)
|
|
|
|
|
—
|
|
|
Total U.S. GAAP Operating Profit
|
|
|
|
|
106,992
|
|
|
|
|
|
82,811
|
|
|
|
|
|
392,269
|
|
|
|
|
|
338,598
|
|
|
Gain/(Loss) on disposal of business and investments
|
|
|
|
|
10,880
|
|
|
|
|
|
(41,410
|
)
|
|
|
|
|
10,880
|
|
|
|
|
|
(41,410
|
)
|
|
Total Other Expense (2)
|
|
|
|
|
1,577
|
|
|
|
|
|
(5,728
|
)
|
|
|
|
|
(9,932
|
)
|
|
|
|
|
(10,465
|
)
|
|
Earnings Before Taxes
|
|
|
|
$
|
119,449
|
|
|
|
|
$
|
35,673
|
|
|
|
|
$
|
393,217
|
|
|
|
|
$
|
286,723
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
|
|
|
Excludes $ 23,844 in restructuring and other charges for the fiscal
year ended September 29, 2017.
|
|
(2)
|
|
|
Years ended September 29, 2017 and September 30, 2016 amounts
include Restructuring and other charges of $1,233 and $277,
respectively.
|
|
|
|
|
|
Other Operational Information (in thousands):
|
|
|
|
|
Three Months Ended
|
|
|
|
|
Year ended
|
|
|
|
|
|
September 29, 2017
|
|
|
|
|
September 30, 2016
|
|
|
|
|
September 29, 2017
|
|
|
|
|
September 30, 2016
|
|
Depreciation (pre-tax)
|
|
|
|
$
|
23,700
|
|
|
|
|
$
|
18,916
|
|
|
|
|
$
|
76,418
|
|
|
|
|
$
|
82,363
|
|
Amortization of Intangibles (pre-tax)
|
|
|
|
$
|
11,204
|
|
|
|
|
$
|
12,109
|
|
|
|
|
$
|
46,095
|
|
|
|
|
$
|
47,608
|
|
Pass-Through Costs Included in Revenues
|
|
|
|
$
|
677,698
|
|
|
|
|
$
|
602,304
|
|
|
|
|
$
|
2,539,311
|
|
|
|
|
$
|
2,489,924
|
|
Capital Expenditures
|
|
|
|
$
|
44,508
|
|
|
|
|
$
|
21,285
|
|
|
|
|
$
|
118,060
|
|
|
|
|
$
|
67,688
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Balance Sheet (in thousands):
|
|
|
|
|
|
|
|
|
|
September 29, 2017
|
|
|
|
|
|
September 30, 2016
|
|
|
ASSETS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
|
|
|
|
|
|
|
$
|
774,151
|
|
|
|
|
|
$
|
655,716
|
|
|
Receivables
|
|
|
|
|
|
|
|
|
|
2,102,543
|
|
|
|
|
|
|
2,115,663
|
|
|
Prepaid expenses and other
|
|
|
|
|
|
|
|
|
|
119,486
|
|
|
|
|
|
|
93,091
|
|
|
Total current assets
|
|
|
|
|
|
|
|
|
|
2,996,180
|
|
|
|
|
|
|
2,864,470
|
|
|
Property, Equipment, and Improvements, Net
|
|
|
|
|
|
|
|
|
|
349,911
|
|
|
|
|
|
|
319,673
|
|
|
Other Noncurrent Assets:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Goodwill
|
|
|
|
|
|
|
|
|
|
3,009,826
|
|
|
|
|
|
|
3,079,628
|
|
|
Intangibles, net
|
|
|
|
|
|
|
|
|
|
332,920
|
|
|
|
|
|
|
336,922
|
|
|
Miscellaneous
|
|
|
|
|
|
|
|
|
|
692,022
|
|
|
|
|
|
|
759,329
|
|
|
Total other noncurrent assets
|
|
|
|
|
|
|
|
|
|
4,034,768
|
|
|
|
|
|
|
4,175,879
|
|
|
|
|
|
|
|
|
|
|
|
$
|
7,380,859
|
|
|
|
|
|
$
|
7,360,022
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Current Liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Notes payable
|
|
|
|
|
|
|
|
|
$
|
3,071
|
|
|
|
|
|
$
|
2,421
|
|
|
Accounts payable
|
|
|
|
|
|
|
|
|
|
683,605
|
|
|
|
|
|
|
522,427
|
|
|
Accrued liabilities
|
|
|
|
|
|
|
|
|
|
939,687
|
|
|
|
|
|
|
938,378
|
|
|
Billings in excess of costs
|
|
|
|
|
|
|
|
|
|
299,864
|
|
|
|
|
|
|
319,460
|
|
|
Total current liabilities
|
|
|
|
|
|
|
|
|
|
1,926,227
|
|
|
|
|
|
|
1,782,686
|
|
|
Long-term Debt
|
|
|
|
|
|
|
|
|
|
235,000
|
|
|
|
|
|
|
385,330
|
|
|
Other Deferred Liabilities
|
|
|
|
|
|
|
|
|
|
732,281
|
|
|
|
|
|
|
861,824
|
|
|
Commitments and Contingencies
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ Equity:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital stock:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock, $1 par value, authorized—1,000,000 shares; issued
and outstanding—none
|
|
|
|
|
|
|
|
|
|
—
|
|
|
|
|
|
|
—
|
|
|
Common stock, $1 par value, authorized—240,000,000 shares; issued
and outstanding—120,385,544 shares and 120,950,899 shares as of
September 29, 2017 and September 30, 2016, respectively
|
|
|
|
|
|
|
|
|
|
120,386
|
|
|
|
|
|
|
120,951
|
|
|
Additional paid-in capital
|
|
|
|
|
|
|
|
|
|
1,239,782
|
|
|
|
|
|
|
1,168,272
|
|
|
Retained earnings
|
|
|
|
|
|
|
|
|
|
3,721,698
|
|
|
|
|
|
|
3,586,647
|
|
|
Accumulated other comprehensive loss
|
|
|
|
|
|
|
|
|
|
(653,514
|
)
|
|
|
|
|
|
(610,594
|
)
|
|
Total Jacobs stockholders’ equity
|
|
|
|
|
|
|
|
|
|
4,428,352
|
|
|
|
|
|
|
4,265,276
|
|
|
Non-controlling interests
|
|
|
|
|
|
|
|
|
|
58,999
|
|
|
|
|
|
|
64,906
|
|
|
Total Group stockholders’ equity
|
|
|
|
|
|
|
|
|
|
4,487,351
|
|
|
|
|
|
|
4,330,182
|
|
|
|
|
|
|
|
|
|
|
|
$
|
7,380,859
|
|
|
|
|
|
$
|
7,360,022
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Backlog (in millions):
|
|
|
|
|
|
|
|
|
|
September 29, 2017
|
|
|
|
|
|
September 30, 2016
|
|
Aerospace & Technology
|
|
|
|
|
|
|
|
|
$
|
6,231.4
|
|
|
|
|
|
$
|
5,110.0
|
|
Buildings & Infrastructure
|
|
|
|
|
|
|
|
|
|
5,412.4
|
|
|
|
|
|
|
5,033.5
|
|
Industrial
|
|
|
|
|
|
|
|
|
|
2,836.9
|
|
|
|
|
|
|
3,106.6
|
|
Petroleum & Chemicals
|
|
|
|
|
|
|
|
|
$
|
5,307.9
|
|
|
|
|
|
$
|
5,510.4
|
|
Total
|
|
|
|
|
|
|
|
|
$
|
19,788.6
|
|
|
|
|
|
$
|
18,760.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Non-U.S. GAAP Financial Measures:
In this press release, the Company has included certain non-GAAP
financial measures as defined in Regulation G promulgated under the
Securities Exchange Act of 1934, as amended. The non-GAAP financial
measures included in this press release are adjusted net earnings and
adjusted EPS.
Adjusted net earnings and adjusted EPS are non-GAAP financial measures
that are calculated by excluding the after-tax costs related to (i) the
2015 Restructuring activities, which included involuntary terminations,
the abandonment of certain leased offices, combining operational
organizations and the co-location of employees into other existing
offices; charges associated with our Europe, U.K. and Middle East
region, which included write-offs on contract accounts receivable and
charges for statutory redundancy and severance costs; and restructuring
activities associated with the Company’s announced definitive agreement
to acquire CH2M, which included involuntary terminations (collectively
referred to as “Restructuring and other charges”), and (ii) professional
fees, integration costs and related costs associated with the CH2M
acquisition (collectively referred to as “CH2M professional fees and
integration costs”), which are not considered by management to be part
of the Company’s ordinary operations. We believe that the adjusted net
earnings and adjusted EPS are useful to management, investors and other
users of our financial information in evaluating the Company’s operating
results and understanding the Company’s operating trends by excluding
the effects of the Restructuring and other charges and the professional
fees, integration costs and related costs associated with CH2M
acquisition, which can obscure underlying trends. Additionally,
management uses adjusted net earnings and adjusted EPS in its own
evaluation of the Company’s performance, particularly when comparing
performance to past periods, and believes these measures are useful for
investors because they facilitate a comparison of our financial results
from period to period.
The Company provides non-GAAP measures to supplement U.S. GAAP measures,
as they provide additional insight into the Company’s financial results.
However, non-GAAP measures have limitations as analytical tools and
should not be considered in isolation and are not in accordance with, or
a substitute for, U.S. GAAP measures. In addition, other companies may
define non-GAAP measures differently, which limits the ability of
investors to compare non-GAAP measures of the Company to those used by
our peer companies.
The following tables reconcile the components and values of U.S. GAAP
net earnings and EPS to the corresponding "adjusted" amounts. For the
comparable periods presented below, such adjustments consist of amounts
incurred in connection with the Restructuring and other charges and the
CH2M professional fees and integration costs. Amounts are shown in
thousands, except for per-share data:
U.S. GAAP Reconciliation for the fourth quarter of
fiscal 2017 and 2016:
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
September 29, 2017
|
|
|
|
|
|
|
U.S. GAAP
|
|
|
|
|
Effects of
Restructuring
and Other
Charges
|
|
|
|
|
Effects of
CH2M
professional
fees and
integration
costs
|
|
|
|
|
Adjusted
|
|
|
Revenue
|
|
|
|
$
|
2,653,865
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
2,653,865
|
|
|
Direct cost of contracts
|
|
|
|
|
(2,179,575
|
)
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
(2,179,575
|
)
|
|
Selling, general and administrative expenses
|
|
|
|
|
(367,298
|
)
|
|
|
|
|
19,539
|
|
|
|
|
|
17,100
|
|
|
|
|
|
(330,659
|
)
|
|
Total other (expense) income, net
|
|
|
|
|
12,457
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
12,457
|
|
|
Earnings Before Taxes
|
|
|
|
|
119,449
|
|
|
|
|
|
19,539
|
|
|
|
|
|
17,100
|
|
|
|
|
|
156,088
|
|
|
Income Tax (Expense) Benefit
|
|
|
|
|
(26,021
|
)
|
|
|
|
|
(5,980
|
)
|
|
|
|
|
(6,498
|
)
|
|
|
|
|
(38,499
|
)
|
|
Net earnings of the Group
|
|
|
|
|
93,428
|
|
|
|
|
|
13,559
|
|
|
|
|
|
10,602
|
|
|
|
|
|
117,589
|
|
|
Net Earnings Attributable to Non-controlling interests
|
|
|
|
|
714
|
|
|
|
|
|
—
|
|
|
|
|
|
—
|
|
|
|
|
|
714
|
|
|
Net earnings Attributable to Jacobs
|
|
|
|
$
|
94,142
|
|
|
|
|
$
|
13,559
|
|
|
|
|
$
|
10,602
|
|
|
|
|
$
|
118,303
|
|
|
Diluted earnings per share
|
|
|
|
$
|
0.78
|
|
|
|
|
$
|
0.11
|
|
|
|
|
$
|
0.09
|
|
|
|
|
$
|
0.98
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
September 30, 2016
|
|
|
|
|
|
|
U.S. GAAP
|
|
|
|
|
Effects of 2015
Restructuring
and other items
|
|
|
|
|
Adjusted
|
|
|
Revenue
|
|
|
|
$
|
2,640,587
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
2,640,587
|
|
|
Direct cost of contracts
|
|
|
|
|
(2,208,895
|
)
|
|
|
|
|
—
|
|
|
|
|
|
(2,208,895
|
)
|
|
Selling, general and administrative expenses
|
|
|
|
|
(348,881
|
)
|
|
|
|
|
51,236
|
|
|
|
|
|
(297,645
|
)
|
|
Total other income (expense), net
|
|
|
|
|
(47,138
|
)
|
|
|
|
|
41,410
|
|
|
|
|
|
(5,728
|
)
|
|
Earnings Before Taxes
|
|
|
|
|
35,673
|
|
|
|
|
|
92,646
|
|
|
|
|
|
128,319
|
|
|
Income Tax (Expense) Benefit
|
|
|
|
|
(5,790
|
)
|
|
|
|
|
(29,162
|
)
|
|
|
|
|
(34,952
|
)
|
|
Net earnings of the Group
|
|
|
|
|
29,883
|
|
|
|
|
|
63,484
|
|
|
|
|
|
93,367
|
|
|
Net Earnings Attributable to Non-controlling interests
|
|
|
|
|
(239
|
)
|
|
|
|
|
—
|
|
|
|
|
|
(239
|
)
|
|
Net earnings Attributable to Jacobs
|
|
|
|
$
|
29,644
|
|
|
|
|
$
|
63,484
|
|
|
|
|
$
|
93,128
|
|
|
Diluted earnings per share
|
|
|
|
$
|
0.24
|
|
|
|
|
$
|
0.53
|
|
|
|
|
$
|
0.77
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
U.S. GAAP Reconciliation for the fiscal years
ended September 29, 2017 and September 30, 2016:
|
|
|
|
|
Year Ended
|
|
|
|
|
|
|
September 29, 2017
|
|
|
|
|
|
|
U.S. GAAP
|
|
|
|
|
Effects of
Restructuring
and Other
Charges
|
|
|
|
|
Effects of
CH2M
professional
fees and
integration
costs
|
|
|
|
|
|
Adjusted
|
|
|
Revenue
|
|
|
|
$
|
10,022,788
|
|
|
|
|
$
|
17,526
|
|
|
|
|
$
|
—
|
|
|
|
|
|
$
|
10,040,314
|
|
|
Direct cost of contracts
|
|
|
|
|
(8,250,536
|
)
|
|
|
|
|
4,913
|
|
|
|
|
|
—
|
|
|
|
|
|
|
(8,245,623
|
)
|
|
Selling, general and administrative expenses
|
|
|
|
|
(1,379,983
|
)
|
|
|
|
|
111,767
|
|
|
|
|
|
17,100
|
|
|
|
|
|
|
(1,251,116
|
)
|
|
Total other income (expense), net
|
|
|
|
|
948
|
|
|
|
|
|
1,233
|
|
|
|
|
|
—
|
|
|
|
|
|
|
2,181
|
|
|
Earnings Before Taxes
|
|
|
|
|
393,217
|
|
|
|
|
|
135,439
|
|
|
|
|
|
17,100
|
|
|
|
|
|
|
545,756
|
|
|
Income Tax (Expense) Benefit
|
|
|
|
|
(105,842
|
)
|
|
|
|
|
(42,663
|
)
|
|
|
|
|
(6,498
|
)
|
|
|
|
|
|
(155,003
|
)
|
|
Net earnings of the Group
|
|
|
|
|
287,375
|
|
|
|
|
|
92,776
|
|
|
|
|
|
10,602
|
|
|
|
|
|
|
390,753
|
|
|
Net Earnings Attributable to Non-controlling interests
|
|
|
|
|
6,352
|
|
|
|
|
|
(4,913
|
)
|
|
|
|
|
—
|
|
|
|
|
|
|
1,439
|
|
|
Net earnings Attributable to Jacobs
|
|
|
|
$
|
293,727
|
|
|
|
|
$
|
87,863
|
|
|
|
|
$
|
10,602
|
|
|
|
|
|
$
|
392,192
|
|
|
Diluted earnings per share
|
|
|
|
$
|
2.42
|
|
|
|
|
$
|
0.73
|
|
|
|
|
$
|
0.09
|
|
|
|
|
|
$
|
3.24
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Year Ended
|
|
|
|
|
|
|
September 30, 2016
|
|
|
|
|
|
|
U.S. GAAP
|
|
|
|
|
Effects of 2015
Restructuring
and other items
|
|
|
|
|
Adjusted
|
|
|
Revenue
|
|
|
|
$
|
10,964,157
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
10,964,157
|
|
|
Direct cost of contracts
|
|
|
|
|
(9,196,326
|
)
|
|
|
|
|
—
|
|
|
|
|
|
(9,196,326
|
)
|
|
Selling, general and administrative expenses
|
|
|
|
|
(1,429,233
|
)
|
|
|
|
|
187,630
|
|
|
|
|
|
(1,241,603
|
)
|
|
Total other income (expense), net
|
|
|
|
|
(51,875
|
)
|
|
|
|
|
41,687
|
|
|
|
|
|
(10,188
|
)
|
|
Earnings Before Taxes
|
|
|
|
|
286,723
|
|
|
|
|
|
229,317
|
|
|
|
|
|
516,040
|
|
|
Income Tax (Expense) Benefit
|
|
|
|
|
(72,208
|
)
|
|
|
|
|
(66,225
|
)
|
|
|
|
|
(138,433
|
)
|
|
Net earnings of the Group
|
|
|
|
|
214,515
|
|
|
|
|
|
163,092
|
|
|
|
|
|
377,607
|
|
|
Net Earnings Attributable to Non-controlling interests
|
|
|
|
|
(4,052
|
)
|
|
|
|
|
—
|
|
|
|
|
|
(4,052
|
)
|
|
Net earnings Attributable to Jacobs
|
|
|
|
$
|
210,463
|
|
|
|
|
$
|
163,092
|
|
|
|
|
$
|
373,555
|
|
|
Diluted earnings per share
|
|
|
|
$
|
1.73
|
|
|
|
|
$
|
1.35
|
|
|
|
|
$
|
3.08
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Additional Information and Where to Find It
In connection with the proposed acquisition of CH2M Hill Companies Ltd.
(“CH2M”) by Jacobs Engineering Group Inc. (the “Company”) pursuant to
the terms of an Agreement and Plan of Merger by and among CH2M, the
Company and Basketball Merger Sub Inc., a wholly owned subsidiary of the
Company (“Merger Sub”), the Company filed with the Securities and
Exchange Commission (the “SEC”) a Registration Statement on Form S-4
(the “Form S-4”) on September 19, 2017, Amendment No. 1 to the Form S-4
on October 24, 2017 and Amendment No. 2 to the Form S-4 on November 8,
2017, which filings contain a proxy statement of CH2M and a prospectus
of the Company. The Form S-4 (as amended) was declared effective on
November 9, 2017, and the definitive proxy statement/prospectus was
mailed or otherwise disseminated to CH2M’s stockholders on or about
November 10, 2017. BEFORE MAKING ANY VOTING OR INVESTMENT DECISION,
INVESTORS ARE URGED TO READ THE PROXY STATEMENT/PROSPECTUS (INCLUDING
ALL AMENDMENTS AND SUPPLEMENTS) BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE COMPANY, CH2M AND THE MERGER. Investors may obtain
free copies of the proxy statement/prospectus when it becomes available,
as well as other filings containing information about the Company and
CH2M, without charge, at the SEC’s Internet website (http://www.sec.gov).
Copies of these documents may also be obtained for free from the
companies’ websites at www.jacobs.com
or www.ch2m.com.
Participants in Solicitation
The Company, CH2M and their respective officers and directors may be
deemed to be participants in the solicitation of proxies from the
stockholders of CH2M in connection with the proposed Merger of Merger
Sub with and into CH2M. Information about the Company’s executive
officers and directors is set forth in its Annual Report on Form 10-K,
which was filed with the SEC on November 21, 2017 and its proxy
statement for its 2017 annual meeting of stockholders, which was filed
with the SEC on December 9, 2016. Information about CH2M’s executive
officers and directors is set forth in its Annual Report on Form 10-K,
which was filed with the SEC on March 7, 2017, and the proxy statements
for its 2017 annual meeting of stockholders, which was filed with the
SEC on April 24, 2017. Investors may obtain more detailed information
regarding the direct and indirect interests of the Company, CH2M and
their respective executive officers and directors in the acquisition by
reading the preliminary and definitive proxy statement/prospectus
regarding the proposed transaction that was filed with the SEC. You may
obtain free copies of these documents as described in the preceding
paragraph.
No Offer or Solicitation
This press release relates to a proposed business combination between
the Company and CH2M. This press release is for informational purposes
only and shall not constitute an offer to sell or the solicitation of an
offer to buy any securities, nor shall there be any sale of securities
in any jurisdiction in which such offer, solicitation or sale would be
unlawful prior to the registration or qualification under the securities
laws of any such jurisdiction. This document is not a substitute for the
prospectus or any other document that the Company or CH2M may file with
the SEC in connection with the proposed transaction. No offering of
securities shall be made, except by means of a prospectus meeting the
requirements of Section 10 of the Securities Act of 1933, as amended.
View source version on businesswire.com: http://www.businesswire.com/news/home/20171121005353/en/
Source: Jacobs Engineering Group Inc.