Jacobs Solutions Inc. Q3 FY2020 Earnings Call

· Earnings call transcript and AI-powered summary

Overall Performance and Strategic Highlights
  • Despite COVID-19 challenges, Jacobs delivered stronger-than-expected Q3 results with pro forma backlog up 4% year-over-year and adjusted operating profit up 3% versus Q3 2019.
  • Free cash flow was $332 million for the quarter, and full-year FY20 free cash flow is expected to approach $400 million.
  • FY20 adjusted EBITDA guidance increased to a range of $1.00 billion to $1.05 billion (previously $950 million to $1.05 billion).
  • FY20 adjusted EPS guidance increased to $5.05–$5.30 (from $4.80–$5.30). At midpoint, EPS shows year-over-year growth excluding discrete tax items.
  • The estimated second-half FY20 COVID-19 earnings impact reduced to $0.35 per share, improved from the prior estimate of $0.50.
  • The company expects adjusted EBITDA growth in FY21, with stronger performance in the second half of the fiscal year.
Justice and Equality Initiative
  • Jacobs launched a Global Action Plan focused on advancing justice and equality with four pillars: culture building, leadership accountability, talent development, and business growth.
  • Commitments include Bystander Intervention training for all 55,000 employees by FY21, leadership dialogues on anti-racism, tying leader compensation to inclusion performance, and adding MLK Jr. Day as a company holiday.

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Operator: Good morning. May name is Elaine, and I will be your conference operator today. At this time, I would like to welcome everyone to the Jacobs Fiscal Third Quarter 2020 Earnings Conference Call and Webcast. All lines have been placed on mute to prevent any background noise. After the speakers’ remarks, there will be a question-and-answer session. [Operator Instructions] Thank you. Mr. Jonathan Doros, you may begin your conference from Investor Relations. Jonathan Doros: Good morning and evening to all. Our earnings announcement was filed this evening and we have posted a copy of this slide presentation and our prepared remarks to our website, which we will reference during the call. I'd like to refer you to our forward-looking statement disclaimer, which is summarized on slide 2. Certain statements contained in this presentation constitute forward-looking statements, as such is defined in Section 27A of the Securities Act of 1933, as amended; and Section 21E of the Securities and Exchange Act of 1934, as amended, and such statements are intended to be covered by the safe harbor provided by the same. Statements made in this presentation that are not based on historical facts are forward-looking statements. Examples of forward-looking statements include, but are not limited to, statements we make concerning the potential effects of the COVID-19 pandemic on our business, financial condition and results of operations and our expectations as to our future growth, prospects

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