LOWELL, MA — (Marketwire) — 02/06/13 — (NYSE: TRR), a recognized leader in engineering, consulting and construction management services to the , and markets, today announced financial results for the fiscal three and six months ended December 28, 2012.
(1) The Company believes net service revenue best reflects the value of services provided to its customers and is the most meaningful indicator of TRC–s revenue performance.
(2) On October 5, 2011 a post-trial motion was granted to disregard a substantial portion of the verdict in this matter resulting in an $11.2 million reduction of the litigation accrual in the first quarter of fiscal 2012. In the fourth quarter of fiscal 2011 the Company had recorded litigation expense of $17.3 million related to the verdict.
(3) The Company received approval of a federal tax settlement resulting in a one-time benefit in the first quarter of fiscal 2012.
“In the second quarter TRC delivered another solid performance as we continued to grow the business despite challenging market conditions,” said Chairman and Chief Executive Officer . “Driven by higher demand for our Energy services, Net Service Revenue (NSR) increased 2% in the second quarter compared to the same quarter of the prior year. We also continued building our growth platform and finalized two strategic acquisitions which closed at the beginning of our fiscal third quarter.”
“Energy segment NSR grew 9% in the second quarter compared to the same period of the prior year primarily due to increased activity on electric distribution projects for large utilities and the expansion of our geographic presence in the mid-Atlantic region. Segment profit for the quarter was down 14% compared to the second quarter of fiscal 2012 reflecting higher-than-expected contract costs on several fixed-price projects. The market demand for distribution and transmission services continues to be high, and we believe that capital spending programs underlying those markets represent a growth opportunity for TRC in the years ahead.”
“Our Environmental segment NSR grew 2% and profit was up 8% in the second quarter compared to the same period of the prior year due to increased utilization on certain large remediation projects. Natural gas pipeline development and regional gas transportation, as well as the potential for gas export, continue to represent major opportunities for TRC. Our Infrastructure segment, which is most affected by the lack of consistent government funding, saw NSR decrease 8% and profit 25% in the second quarter compared to the same period of the prior year, reflecting lower overall demand for our services. However, segment NSR backlog for the quarter was 14% higher than in the comparable period of the prior year.”
“We recently acquired GE–s Air Emissions Testing business and the Heschong Mahone Group, Inc. (“HMG”), a California based energy efficiency consulting firm. The addition of the GE business to our Environmental segment strengthens our leadership position in the emissions testing market by adding technical resources and geographic reach, primarily in the upper Midwest, West Coast, and the South. Energy efficiency is a key growth market, and the HMG acquisition in our Energy segment augments our client base and service offerings while expanding our presence in the West Coast energy efficiency market. These acquisitions represent important steps in our profitable growth strategy and extend our momentum by focusing resources on our most attractive markets.”
“As we have said before, we believe TRC is in the right markets at the right time. We are well-positioned to benefit as the ongoing transformation of the U.S. energy industry continues and capital spending patterns normalize in our target markets. We continue to maintain a strong balance sheet and will leverage that to pursue profitable growth both organically and through acquisitions.”
The Company will broadcast its financial results conference call today, February 6, 2013 at 9 a.m. ET. Those who wish to listen to the conference call should visit the “” section of TRC–s website at . The call may also be accessed by dialing (877) 709-8155 or (201) 689-8881. For interested individuals unable to join the live conference call, a webcast replay will be available on the Company–s website for one year.
A pioneer in groundbreaking scientific and engineering developments since the 1960s, TRC is a national engineering, consulting and construction management firm that provides integrated services to the , and markets. TRC serves a broad range of clients in and industry, implementing complex projects from initial concept to delivery and operation. TRC delivers results that enable clients to achieve success in a complex and changing world. For more information and updates from the Company, visit TRC–s website at and follow TRC on Twitter at and on .
Certain statements in this press release may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You can identify these statements by forward-looking words such as “may,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” or other words of similar import. You should consider statements that contain these words carefully because they discuss TRC–s future expectations, contain projections of the Company–s future results of operations or of its financial condition, or state other “forward-looking” information. TRC believes that it is important to communicate its future expectations to its investors. However, there may be events in the future that the Company is not able to accurately predict or control and that may cause its actual results to differ materially from the expectations described in its forward-looking statements. Investors are cautioned that all forward-looking statements involve risks and uncertainties, and actual results may differ materially from those discussed as a result of various factors, including, but not limited to, the uncertainty of TRC–s operational and growth strategies; circumstances which could create large cash outflows, such as contract losses, litigation, uncollectible receivables and income tax assessments; regulatory uncertainty; the availability of funding for government projects; the level of demand for TRC–s services; product acceptance; industry-wide competitive factors; the ability to continue to attract and retain highly skilled and qualified personnel; the availability and adequacy of insurance; and general political or economic conditions. Furthermore, market trends are subject to changes, which could adversely affect future results. See the risk factors and additional discussion in TRC–s Annual Report on Form 10-K for the fiscal year ended June 30, 2012, Quarterly Reports on Form 10-Q, and other factors detailed from time to time in the Company–s other filings with the Securities and Exchange Commission.
Dennis Walsh
Sharon Merrill
(617) 542-5300
Thomas W. Bennet, Jr.
CFO
(978) 970-5600