Dive Brief:
- Jacobs posted earnings of $171.61 million for its first quarter 2024, which ended Dec. 29, marking a 26.5% increase from its earnings of $135.65 million a year ago, according to the company’s earnings report.
- Revenue for its first quarter jumped to $4.2 billion compared to $3.8 billion in the prior year, up about 9.5%, due to water infrastructure and advanced manufacturing projects, said Jacobs CEO Bob Pragada.
- The Dallas-based company reported its backlog reached $29.6 billion, about a 4.7% jump from last year. That increase stems from growth in all of Jacobs’ business divisions, according to the earnings report.
Dive Insight:
Jacobs continues to add notable wins in its water infrastructure and advanced facility projects, two areas the company identified as key sectors of focus, said Pragada during the call.
For example, chipmaker giant TSMC recently selected Jacobs for the first phase of the design and project delivery of the campus’ industrial reclaimed water plant for its $40 billion semiconductor facility in Phoenix. Jacobs also won a $191 million project in St. Johns County, Florida, for the design and project delivery of a water reclamation facility, according to the company.
The Dallas-based firm also has ongoing projects in transportation, including the design of a high-speed rail link in Las Vegas to Southern California, said Pragada during the call.
“We kicked off 2024 with strong performance, underpinned by robust organic revenue growth in our People and Places Solutions business, reflecting the broad-based strength that we see in global infrastructure and sustainability investment,” said Pragada. “Aligned with our position as a global leader in science-based, digitally-enabled solutions, our portfolio remains resilient.”
Takeaways from earnings
Jacobs remains on track with its plans to spin off its Critical Mission Solutions and Cyber & Intelligence government services business and merge them with Amentum, a global engineering and technology company.
That should bode well for the company, since its energy, chemical and resource business tended to be more cyclical and less profitable, according to a research note from Matt Arnold, industrial analyst with financial services firm Edward Jones.
“The remaining company will have strong positions in infrastructure consulting and advanced facility design. The intent of the spinoff is to focus Jacobs on its faster-growing and more profitable infrastructure business,” Arnold wrote. “In addition, we view the remaining business as a likely beneficiary of the infrastructure stimulus that was signed into law.”
The deal will create a new publicly traded company focused on the government-services sector, providing consulting services to government agencies aligned to space, national security, nuclear remediation, 5G technology and cybersecurity.
Jacobs shareholders will receive shares of the new company in a tax-free transaction sometime during the second half of fiscal 2024, according to Arnold.
