Second Quarter Fiscal 2019
PHOENIX SKY HARBOR INTERATIONAL AIRPORT TERMINAL 3 MODERNIZATION
United States Serving as design-builder for the new renovation of the Terminal 3 facility, north concourse and the addition of a new south concourse
Disclosures
Safe Harbor
Except for historical information contained herein, this presentation contains "forward-looking statements." All statements other than statements of historical fact are "forward-looking statements" for purposes of federal and state securities laws, financial and business projections, including but not limited to revenue, earnings, operating and free cash flows, stock repurchases; cost savings reduction, profitability; any statements of the plans, strategies and objectives for future operation profitability, risk profile and investment strategies; any statements regarding future economic conditions or performance; any statements of belief; and any statements of assumptions underlying any of the foregoing. Forward-looking statements may include the words "may," "will," "estimate," "intend," "continue," "believe," "expect" or "anticipate" and other similar words.
Although we believe that the expectations reflected in any of our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and to inherent risks and uncertainties, such as those disclosed in this presentation. Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in forward-looking statements include, among others, the following:
•our business is cyclical and vulnerable to economic downturns and client spending reductions;
•dependence on long-term government contracts and 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;
•unexpected government shutdowns and impacts caused by Brexit;
•losses under fixed-price contracts;
•limited control over operations run through our joint venture entities;
•misconduct by our employees or consultants or our failure to comply with laws or regulations applicable to our business;
•maintain adequate surety and financial capacity;
•our leveraged position and ability to service our debt and guarantees;
•exposure to legal, political and economic risks in different countries as well as currency exchange rate fluctuations;
•retaining and recruiting key technical and management personnel;
•legal claims and inadequate insurance coverage;
•environmental law compliance and adequate nuclear indemnification;
•unexpected adjustments and cancellations related to our backlog;
•dependence on partners and third parties who fail to satisfy their obligations;
•AECOM Capital Real Estate development projects;
•managing pension costs and cybersecurity, IT outages and data privacy; and
•changing client demands, fiscal positions and payments.
Additional factors that could cause actual results to differ materially from our forward-looking statements are set forth in our most recent periodic report (Form 10-K or Form 10-Q) filed and our other filings with the Securities and Exchange Commission. We do not intend, and undertake no obligation, to update any forward-looking statement.
Non-GAAP Measures
This presentation 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, adjusted interest expense, organic 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, adjusted tax rate and adjusted interest expense to exclude the impact of non-operating items, such as amortization expense, taxes, acquisition and integration expenses, 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 constant currency information, such as organic revenue, to help assess how our underlying businesses performed excluding the effect of foreign currency rate fluctuations to aid investors in better understanding our international operational performance.
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 to the most directly comparable GAAP financial measures is found in the attached appendix and in our earnings release on the Investors section of our Web site at: http://investors.aecom.com. 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 the length, high variability, complexity and low visibility associated with the non-GAAP expectation projected against the multi-year forecast which could significantly impact the GAAP measure.
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Michael S. Burke
Chairman
Chief Executive Officer
GORDIE HOWE INTERNATIONAL BRIDGE
United States / Canada
Connecting Windsor, Canada and Detroit, Michigan via a
2.5kilometer bridge that when completed will be the longest cable-stayed bridge on the continent.
Second Quarter Fiscal 2019 Results
•Continued positive organic revenue1 growth, 17% adjusted EBITDA2 growth and all-time high backlog of $61 billion
•Financial performance was ahead of our expectations:
-Strong profitability in the DCS segment
-Delivered double-digit growth in the MS segment driven by strong conversion of record backlog
-$8.1 billion of wins with strength across the business, including in the higher-margin MS and DCS segments
Continued Organic Revenue Growth
Record Backlog
$5.0B
$4.8B
Q2'18Q2'19
$61.0B
$49.9B
Q2'18Q2'19
$235M
• Continue to prioritize stock repurchases, including $210 | Double-Digit Adj. |
EBITDA2 | Growth |
million to-date under our $1 billion Board authorization | |
and debt reduction to achieve 2.5x net leverage4
$201M
Q2'18Q2'19
CONFIDENT IN ACHIEVING OUR FY'19 FINANCIAL GUIDANCE
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Delivering on Our Commitment to Generate Substantial Value
EXECUTED $225 MILLION G&A REDUCTION PLAN
•Positioned the DCS segment to deliver at least 7% adj. operating margins2 in FY'19 and at least 7.5% adj. operating margins in FY'20, with additional opportunities for margin expansion being evaluated
DE-RISKING AND HONING FOCUS ON HIGHER-MARGIN, LOWER-RISKPROFESSIONAL SERVICES MARKETS
•On track to exit the fixed-price, combined cycle gas power market and at-risk O&G construction markets, including agreement to divest the Production Services business, which closed early in Q3
•No longer pursuing international at-risk construction projects and accelerating our review of all at-risk construction exposure
OPTIMIZING GEOGRAPHIC FOOTPRINTS
•Approximately 40% complete with our plan to exit more than 30 countries
•Focused on improving return on invested capital and return on management time
DRIVING DOUBLE-DIGITADJUSTED EARNINGS GROWTH:
$1,000+
$940
$837
Adjusted EBITDA2 (millions)
FY'18 | FY'19E | FY'20E |
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AECOM published this content on 08 May 2019 and is solely responsible for the information contained herein. Distributed by Public, unedited and unaltered, on 08 May 2019 15:22:06 UTC