JACOBS ENGINEERING GROUP INC /DE/ - FORM 8-K - EX-99.1 - EXHIBIT 99.1 - February 3, 2016

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8-K - 8-K - JACOBS ENGINEERING GROUP INC /DE/firstquarterfiscal2016earn.htm
Exhibit 99.1

 
 
 
 
155 North Lake Avenue 91101
 
PO Box 7084
 
Pasadena, California 91109-7084
 
1.626.578.3500 Fax 1.626.578.7144
Press Release
FOR IMMEDIATE RELEASE
February 3, 2016

For additional information contact:

Kevin C. Berryman
Executive Vice President and Chief Financial Officer
626.578.3505

Jacobs Engineering Group Inc. Reports Earnings for the First Quarter of Fiscal 2016
PASADENA, CALIF - Jacobs Engineering Group Inc. (NYSE:JEC) today announced its financial results for the first quarter of fiscal 2016 ended January 1, 2016.
First Quarter Fiscal 2016 Highlights:

•
U.S.-GAAP net earnings and EPS of $47 million and $0.38, respectively;
•
Adjusted net earnings of $95 million;
•
Adjusted EPS of $0.78;
•
Backlog at January 1, 2016 of $18.2 billion;
•
2015 Restructuring (focused on cost effectiveness) - delivering strong results - now targeting annual savings of $180-200 million;
•
1.0 million shares of common stock repurchased during the first quarter of fiscal 2016 for $42 million;

Jacobs reported today adjusted net earnings of $95 million, or $0.78 per diluted share, on revenues of $2.8 billion for its first quarter of fiscal 2016 ended January 1, 2016 (U.S. GAAP net earnings and EPS were $47 million and $0.38, respectively). This compares to net earnings of $100 million, or $0.77 per diluted share, on revenues of $3.2 billion for the first quarter of fiscal 2015 ended December 26, 2014. Included in the Company's first quarter adjusted net earnings is a $11 million, or $0.09 per share, tax benefit related to an international tax matter.

The Company's adjusted net earnings for the first quarter of fiscal 2016 exclude the after-tax costs related to certain restructuring activities that began during fiscal 2015 (the "2015 Restructuring") totaling $48 million, or $0.40 per diluted share.

Jacobs also announced total backlog of $18.2 billion at January 1, 2016, including a technical professional services component of $11.4 billion.

Commenting on the results for the first quarter of fiscal 2016, Jacobs President and CEO Steve Demetriou stated, “Despite strong headwinds in certain sectors and a challenging macro-economic

1
Exhibit 99.1

environment, we delivered results aligned with our expectations. This performance was due to our diverse portfolio of customers, geographic footprint and improvements in project delivery execution. Our performance was also supported by our efforts to realign our business and streamline operations, which continues to benefit the Company and right-sizes it in light of current economic conditions."

Commenting on the Company’s reorganization and its earnings outlook, Jacobs Chief Financial Officer Kevin Berryman stated, “The Company remains on track to implement revised segment reporting for our Q2 results, given that the company has begun managing its operations during Q2 along the previously announced four lines of business: Petroleum & Chemicals, Building & Infrastructure, Aerospace & Technology, and Industrial. Regarding our outlook, although the Company met expectations in the quarter, continuing challenges in certain end-markets require us to remain cautious as to our near-term outlook.  Considering the benefits we're realizing from our recent restructuring activities, we are confirming our fiscal 2016 adjusted EPS range of $2.80 to $3.30, including the discrete international tax item."

Jacobs is hosting a conference call at 11:00 a.m. Eastern Time on Wednesday, February 3, 2016, 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 technical professional and construction services.

Statements made in this press release that are not based on historical fact are forward-looking statements. 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. For a description of some of the 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 October 2, 2015, 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. We also caution the readers of this release that we do not undertake to update any forward-looking statements made herein.
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Exhibit 99.1


Financial Highlights:
Results of Operations (in thousands, except per-share data):        
 
Three Months Ended
 
January 1, 2016
December 26, 2014
Revenues
$
2,847,934

$
3,187,005

Costs and Expenses:
 
 
Direct costs of contracts
(2,407,460
)
(2,667,559
)
Selling, general, and administrative expenses
(381,024
)
(361,223
)
Operating Profit
59,450

158,223

Other Income (Expense):
 
 
Interest income
2,220

2,276

Interest expense
(3,543
)
(5,318
)
Miscellaneous income (expense), net
(340
)
(486
)
Total other income (expense), net
(1,663
)
(3,528
)
Earnings Before Taxes
57,787

154,695

Income Tax Benefit (Expense)
(7,481
)
(48,500
)
Net Earnings of the Group
50,306

106,195

Net Earnings Attributable to
  Noncontrolling Interests
(3,792
)
(6,116
)
Net Earnings Attributable to Jacobs
$
46,514

$
100,079

Earnings Per Share (“EPS”):
 
 
Basic
$
0.38

$
0.78

Diluted
$
0.38

$
0.77

 
 
 
Weighted Average Shares Used to Calculate EPS:
 
 
Basic
120,888

128,652

Diluted
121,959

129,973


Other Operational Information (in thousands):    
 
Three Months Ended
 
January 1, 2016
December 26, 2014
Revenues by Major Component:
 
 
Technical professional services
$
1,646,590

$
1,932,524

Field services
1,201,344

1,254,481

Total
$
2,847,934

$
3,187,005

 
 
 
Depreciation (pre-tax)
$
22,167

$
26,006

Amortization of Intangibles (pre-tax)
$
11,726

$
12,981

Pass-Through Costs Included in Revenues
$
670,331

$
706,830

Capital Expenditures
$
(15,987
)
$
(33,775
)

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Exhibit 99.1

Balance Sheet (in thousands):    
 
January 1,
2016
 
October 2,
2015
 
(Unaudited)
 
ASSETS
 
 
 
Current Assets:
 
 
 
Cash and cash equivalents
$
443,725

 
$
460,859

Receivables
2,424,447

 
2,548,743

Deferred income taxes
139,720

 
160,298

Prepaid expenses and other
104,404

 
113,076

Total current assets
3,112,296

 
3,282,976

Property, Equipment and Improvements, Net
361,006

 
381,238

Other Noncurrent Assets:
 
 
 
Goodwill
3,059,279

 
3,048,778

Intangibles
345,770

 
353,419

Miscellaneous
737,500

 
719,515

Total other non-current assets
4,142,549

 
4,121,712

 
$
7,615,851

 
$
7,785,926

LIABILITIES AND STOCKHOLDERS’ EQUITY
 
 
 
Current Liabilities:
 
 
 
Notes payable
$
2,833

 
$
13,364

Accounts payable
421,206

 
566,866

Accrued liabilities
1,033,906

 
1,090,985

Billings in excess of costs
327,031

 
309,951

Total current liabilities
1,784,976

 
1,981,166

Long-term Debt
621,899

 
584,434

Other Deferred Liabilities
838,717

 
863,868

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—122,776,878 shares and 123,152,966 shares, respectively
122,777

 
123,153

Additional paid-in capital
1,142,010

 
1,137,144

Retained earnings
3,511,197

 
3,496,212

Accumulated other comprehensive loss
(470,476
)
 
(464,764
)
Total Jacobs stockholders’ equity
4,305,508

 
4,291,745

Noncontrolling interests
64,751

 
64,713

Total Group stockholders’ equity
4,370,259

 
4,356,458

 
$
7,615,851

 
$
7,785,926


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Exhibit 99.1

Backlog (in thousands):
 
January 1, 2016
December 26, 2014
Backlog Information:
 
 
Technical professional services
$
11,421,400

$
13,222,400

Field services
6,801,000

5,885,000

Total
$
18,222,400

$
19,107,400


Non-U.S. GAAP Financial Measures:

The following tables reconcile the U.S. GAAP values of certain elements of the Company's results of operations to the corresponding "adjusted" amounts. For fiscal 2016, such adjustments consist of amounts incurred in connection with the 2015 Restructuring. For the first quarter of fiscal 2015, there were no such adjustments. Although such adjusted amounts are non-GAAP in nature, they are presented because management believes it provides a better view of the Company’s operating results to investors to assess the Company’s performance and operating trends. Amounts are shown in thousands, except for per-share data:

U.S. GAAP Reconciliation for the first quarter fiscal 2016:
 
U.S. GAAP
 
Effects of 2015 Restructuring
 
Without 2015 Restructuring
 Consolidated pre-tax earnings
$
57,787

 
$
(68,383
)
 
$
126,170

 Tax expense
(7,481
)
 
20,247

 
(27,728
)
 Net earnings of the Group
50,306

 
(48,136
)
 
98,442

 Non-controlling interests
(3,792
)
 
—

 
(3,792
)
 Net earnings of Jacobs
$
46,514

 
$
(48,136
)
 
$
94,650

 Diluted earnings per share
$
0.38

 
$
(0.40
)
 
$
0.78






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JACOBS ENGINEERING GROUP INC /DE/ Reports