Tetra Tech, Inc. (NASDAQ:TTEK) today announced results for the fourth quarter and fiscal year ended October 2, 2016.
Fourth Quarter Results
Revenue in the fourth quarter totaled $729 million, up 26% year over year. For ongoing operations(1), revenue totaled $713 million, and revenue, net of subcontractor costs(2) (net revenue), was $526 million, up 27% and 25%, respectively, compared to the same period in fiscal 2015. Operating income for the fourth quarter was $47 million, and on an ongoing basis totaled $52 million, up 14% compared to the previous year. Earnings per share (EPS) were $0.53, and on an ongoing basis totaled $0.59, up 18% year over year. Backlog of $2.38 billion was up 25% year over year.
Quarterly Dividend and Share Repurchase Program
On November 7, 2016, Tetra Tech’s Board of Directors declared a quarterly dividend of $0.09 per share payable on December 14, 2016 to stockholders of record as of December 1, 2016. Additionally, the Board authorized a new program to repurchase up to $200 million of common stock, following the recently completed $200 million buyback program.
Fiscal Year Results
Revenue for the fiscal year totaled $2.58 billion, up 12% year over year. For ongoing operations(1), revenue totaled $2.53 billion and net revenue was $1.91 billion, up 14% and 13%, respectively, from fiscal 2015. Operating income for the fiscal year was $136 million, and on an ongoing basis totaled $170 million, up 10% compared to the previous year. EPS was $1.42, and on an ongoing basis totaled $1.88, up 17% year over year.
Comments on Results
Tetra Tech’s Chairman and CEO, Dan Batrack commented, “Tetra Tech had a strong fiscal 2016 and finished the year with record-high fourth quarter revenue and income. We continued our focus on leading with science and providing clients with differentiated high-end consulting and engineering services primarily in the water, environment and energy markets. We completed the year with broad-based contract wins across our end markets, led by growth in U.S. federal, state and local, and international development. This momentum drove our backlog to an all-time high, providing a strong foundation for growth in fiscal 2017.”
(1) Refer to the Operating Results table for a reconciliation to GAAP.
(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.
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 expects diluted EPS for the first quarter of fiscal 2017 to be in the range of $0.44 to $0.48. Net revenue for the first quarter is expected to range from $450 million to $475 million. For fiscal 2017, Tetra Tech expects diluted EPS to be in the range of $2.00 to $2.20 and net revenue to range from $2.0 billion to $2.1 billion.
Webcast
Investors will have the opportunity to access a live audio-visual webcast and supplemental financial information concerning the fourth quarter and fiscal year 2016 results through a link posted on the Company’s website at tetratech.com on November 10, 2016 at 8:00 a.m. (PT).
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.
