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Construction services provider, Jacobs Engineering Group Inc. (JEC - Analyst Report), reported modest fiscal third-quarter 2013 (ended Jun 28, 2013) financial results. While the overall results improved year over year, earnings fell short of the Zacks Consensus Estimate.

The company reported third-quarter earnings per share of 83 cents, a penny lower than the Zacks Consensus Estimate of 84 cents. The quarterly earnings improved 9.2% from the year-ago earnings of 76 cents due to improvement in revenues as well as margins.

Revenues: Revenues increased 11.1% year over year to $3.08 billion in the reported quarter and beat the Zacks Consensus Estimate of $2.99 billion comfortably. Technical Professional Services revenues came in at $1.71 billion, compared with $1.64 billion in the year-ago quarter. Field Services revenues in fiscal third quarter of 2013 were $1.36 billion, compared with $1.13 billion in the third quarter of fiscal 2012.

Costs/Margin: During the reported quarter, direct costs of contracts, a major expenditure for Jacobs, edged up 11.7% from the year-ago quarter and settled at $2.61 billion. Selling, general and administrative (SG&A) expenses came in at $298.6 million, up 6.8% year over year.

Operating margin reached 5.5%, almost flat compared with the year-ago quarter.

Backlog: Exiting the quarter, backlog stood at $17.2 billion, an increase of 10.2% from $15.6 billion in the year-ago quarter. It includes backlog from Technical Professional Services of $11.09 billion versus $10.17 billion at the end of the third quarter of fiscal 2012, with the remainder coming from Field Services.

Balance Sheet: Jacobs’ cash and cash equivalents at the end of fiscal third quarter were approximately $1.30 billion, increasing from $1.17 recorded at the end of the previous quarter. Total debt at the quarter end decreased to $445.0 million, compared with $450.8 million as of Mar 29, 2013.

Outlook: Jacobs reaffirmed its earnings expectations for fiscal 2013 to range between $3.00 and $3.50 per share. Management also sees ample opportunities to increase market share as end markets see significant improvement.

Other Stocks to Consider

Fluor Corporation (FLR - Analyst Report) is expected to release its second-quarter results before the market opens on Aug 1, 2013. The Zacks Consensus Estimate for the quarter is $1.01.

AECOM Technology Corporation (ACM - Analyst Report) is expected to release its fiscal third-quarter results before the market opens on Aug 6, 2013. The Zacks Consensus Estimate for the quarter is 64 cents.

Foster Wheeler AG (FWLT - Analyst Report) is expected to release its second-quarter results before the market opens on Aug 8, 2013. The Zacks Consensus Estimate for the quarter is 33 cents.

Jacobs currently carries a Zacks Rank #3 (Hold).

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