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Jacobs Solutions Inc. is a global professional services company that delivers technology-centric solutions to tackle complex challenges across various sectors . The company operates through two primary lines of business: Critical Mission Solutions (CMS) and People & Places Solutions (P&PS), offering services that range from information and cyber warfare to climate change and smart cities . Jacobs generates revenue from both cost-reimbursable and fixed-price contracts, with a significant portion coming from cost-reimbursable contracts . The company also invests in PA Consulting and operates Divergent Solutions (DVS), which integrates offerings to both CMS and P&PS . Jacobs' operations are geographically diverse, with a presence in North America, Europe, the Middle East, India, Australia, New Zealand, and Asia .
- Critical Mission Solutions (CMS) - Provides solutions for information and cyber warfare, digital transformation, national security, defense, space exploration, and green energy transition, serving sectors like Aerospace, Automotive, Space, Telecom, Intel, Defense, and Energy .
- People & Places Solutions (P&PS) - Offers end-to-end solutions for challenges related to climate change, energy transition, connected mobility, integrated water management, and smart cities, serving clients in Infrastructure, Cities & Places, Energy & Environmental, Health & Life Sciences, and Advanced Manufacturing .
- Divergent Solutions (DVS) - Integrates offerings to both CMS and P&PS, enhancing the company's ability to deliver comprehensive solutions across its business lines .
- "Given the significant reliance on government stimulus programs like the IIJA and CHIPS Act to drive backlog growth, how are you preparing for potential funding delays or reductions, and what steps are you taking to diversify your revenue streams to mitigate this risk?"
- "With the upcoming spin-off and merger with Amentum, can you elaborate on the specific challenges you anticipate in separating the Critical Mission Solutions and Cyber & Intelligence businesses, and how you plan to address any operational disruptions or cost increases during this transition?"
- "You mentioned that approximately two-thirds of your water-related and life sciences business is concentrated in high-value, science-based consulting and advisory services. How sustainable is this level of high-margin work, and what are the risks of increased competition or market saturation impacting your margins in these sectors?"
- "Can you provide more detail on your capital allocation strategy post-spin-off, specifically regarding your appetite for M&A versus returning capital to shareholders, and how you intend to balance organic growth opportunities with potential acquisitions to drive shareholder value?"
- "Given the robust backlog and strong book-to-bill ratio in People & Places Solutions, what challenges do you foresee in converting this backlog into revenue, and are there any capacity constraints or supply chain issues that could impact your ability to deliver on these projects timely and maintain your margin expansion trajectory?"
Competitors mentioned in the company's latest 10K filing.
- AECOM
- Tetra Tech
- WSP
- Arcadis
- Bechtel
- Arup
- Mott MacDonald
- Stantec
- Parsons
- Accenture
- Schneider Electric
- Mace
- AtkinsRealis
- Altair
- Montrose
- Capgemini
- Fluor
- IBM
- Infosys
- Deloitte
- KPMG
- PwC
- Bain & Company
- BCG
- McKinsey & Company
These companies are mentioned as competitors in the markets where Jacobs Solutions Inc. provides services, which include technology, consulting, and engineering firms .
Recent developments and announcements about J.
Financial Reporting
- Revenue: $3.0 billion, a 4.4% increase year-over-year.
- Net Income: $309 million, up 333.1% year-over-year.
- Earnings Per Share (EPS): $2.38, a 277.8% increase year-over-year.
- Backlog: $21.8 billion, up 22.5% year-over-year.
- Revenue: $11.5 billion, a 6.0% increase year-over-year.
- Net Income: $613 million, up 61.6% year-over-year.
- EPS: $4.79, a 57.0% increase year-over-year.
- Free Cash Flow Conversion: Exceeded 100% of net income.
- Jacobs completed the separation of its Critical Mission Solutions and Cyber & Intelligence businesses, now trading as Amentum (NYSE: AMTM).
- The company recorded $187 million in mark-to-market gains on its investment in Amentum, boosting Q4 GAAP net income.
- Jacobs is focusing on a simpler, higher-value, and higher-margin portfolio, with strong demand in end markets such as Water and Environmental, Critical Infrastructure, and Life Sciences and Advanced Manufacturing.
- Adjusted Net Revenue Growth: Expected to grow mid-to-high single digits over fiscal 2024.
- Adjusted EBITDA Margin: Expected to range from 13.8% to 14.0%.
- Adjusted EPS: Expected to range from $5.80 to $6.20.
- Free Cash Flow Conversion: Expected to exceed 100% of net income.
Earnings Report
Jacobs Solutions Inc. (NYSE: J) has released its financial results for the fiscal fourth quarter and fiscal year ended September 27, 2024.
Q4 2024 Financial Highlights
Fiscal Year 2024 Highlights
Significant Trends and Strategic Moves
Outlook for Fiscal Year 2025
Jacobs' strategic shift and financial strength position it well for continued growth and shareholder returns in fiscal year 2025 and beyond .
Financial Actions
- Separation and Distribution: Jacobs transferred its CMS and C&I businesses to a newly formed entity, SpinCo. Subsequently, Jacobs distributed 124,084,108 shares of SpinCo common stock to its shareholders on a pro rata basis .
- Merger: SpinCo merged with Amentum, with SpinCo surviving as an independent public company listed on the New York Stock Exchange under the symbol "AMTM" .
- Ownership Structure: Post-transaction, Jacobs' shareholders own approximately 51% of SpinCo, Jacobs retains about 7.5%, and Amentum Equityholder holds around 37%. An additional 4.5% of SpinCo stock is held in escrow as contingent consideration, dependent on SpinCo's fiscal year 2024 performance .
- Cash Payment: Jacobs received approximately $0.9 billion from SpinCo, which is subject to adjustments based on SpinCo's cash, debt, and working capital levels .
- Debt Reduction: The cash received was used to fully redeem $575 million of the 2020 Term Loan Facility and partially redeem $333 million of revolving credit facility debt, resulting in a net zero impact on cash balances .
- Pro Forma Financials: The transaction is expected to impact Jacobs' financial statements, with the CMS and C&I businesses being reflected as discontinued operations in future reports .
- Strategic Focus: This transaction allows Jacobs to streamline its operations and focus on its core business areas, potentially enhancing operational efficiency and financial performance.
- Future Plans: Jacobs intends to dispose of its remaining equity stake in SpinCo within 12 months, further simplifying its business structure .
Strategic Assets
Jacobs Solutions Inc. Completes Major Asset Disposition
On September 27, 2024, Jacobs Solutions Inc. successfully completed a significant transaction involving the disposition of its Critical Mission Solutions (CMS) and portions of the Divergent Solutions (DVS) business, collectively known as the SpinCo Business. This was achieved through a Reverse Morris Trust transaction, which included a series of strategic agreements and mergers .
Transaction Details
Financial Implications
Operational Impact
This strategic move is anticipated to provide Jacobs with greater financial flexibility and a more focused operational approach, aligning with its long-term business objectives .