Construction services provider,
Jacobs Engineering Group Inc.
), reported strong fiscal fourth-quarter 2013 (ended Sep 27,
2013) financial results. While overall results improved year over
year, earnings fell short of the Zacks Consensus Estimate.
The company reported fourth-quarter adjusted earnings per
share of 84 cents, 5.0% higher than year-ago adjusted earnings of
80 cents. The increase in earnings was a result of improved
revenues and margins in the quarter. The quarterly earnings
missed the Zacks Consensus Estimate of 87 cents by 3.4%.
In fiscal 2013, Jacobs generated adjusted earnings per share
of $3.23, a hike of 11.0% from $2.91 a year ago. However, results
missed the Zacks Consensus Estimate of $3.26 per share.
Revenues gained 12.8% year over year to $3.14 billion in the
reported quarter, in line with the Zacks Consensus Estimate. The
Technical Professional Services component's revenues came in at
$1.66 billion, up compared with $1.63 billion in the year-ago
quarter. The Field Services component's revenues were $1.49
billion, up compared with $1.15 billion reported in the fourth
quarter of fiscal 2012.
In fiscal 2013, revenues amounted to $11.82 billion,
registering an increase of 8.5% year over year. Also, revenues
were in line with the Zacks Consensus Estimate.
In the reported quarter, direct costs of contracts, a major
expenditure for Jacobs, climbed 14.0% from the year-ago quarter
and settled at $2.67 billion. Selling, general and administrative
(SG&A) expenses came in at $299.5 million, up 7.3% year over
In the quarter, operating margin reached 5.6%, declining 45
basis points year over year.
Exiting the quarter, backlog stood at $17.2 billion, rising 8.2%
from $15.9 billion in the year-ago quarter. It includes backlog
from the Technical Professional Services component of $11.12
billion versus $10.27 billion at the end of the fourth quarter of
fiscal 2012, with the remainder coming from the Field Services
Jacobs' cash and cash equivalents at the end of fiscal
fourth-quarter were approximately $1.26 billion, decreasing from
$1.30 billion recorded at the end of the previous quarter. Total
debt at quarter-end declined to $437.9 million, compared with
$445.0 million as of Jun 28, 2013.
Management predicts ample opportunities to increase market share
as end markets promise significant improvement. However, the
first quarter of fiscal 2014 is expected to be weak. For fiscal
2014, the company expects earnings per share in the range of
$3.35 to $3.90.
Other Stocks to Consider
Jacobs currently carries a Zacks Rank #2 (Buy). Other stocks
worth a watch in the industry include
Quanta Services, Inc.
). While VSE Corp. carries a Zacks Rank #1 (Strong Buy), Quanta
Services and KB Home carry a Zacks Rank #2.
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