Tetra Tech Performs Well

Tetra Tech (TTEK - Analyst Report)  reported Q1-09 results: Gross Revenue = $638.7 million, up 35.8%; Net Revenue (i.e., excludes subcontractor costs) = $330.0 million, up 19.1%; Operating Income = $28.6 million, + 26.0%; Net Income = $16.3 million, up 26.4%; Diluted EPS = $0.27, up 24.1%; Backlog = $1.77 billion, up 36.4%. There is joy on Colorado Boulevard.

The Net Revenue breakdown by customer: Federal = 43%, Commercial = 40%, State & Local = 15% and International (includes the results of recently-acquired Wardrop Engineering of Canada) = 15%. Revenue growth in Q1-09: Federal = Gross +8%, Net +12%; Commercial = Gross +127%, Net +43% (~$100 million, or one-half of the total ~$200 contract million value, from one project); State & Local = Gross -14%; Net -10%.

New Segment Net Revenue mix based on Q1-09 results: Environmental Consulting Services (ECS) = 27%; Technical Support Services (TSS) = 23%; Engineering and Architectural Services (EAS) = 19%; Remediation and Construction Management (RCM) = 31%.

Fiscal year 2009 revenue outlook by market: Federal (U.S. Agency for International Development = USAID + Dept. of Defense Base Realignment and Closure = BRAC) = 45% of revenue, growing at 5+%; Commercial (wind energy, water) = 35% of revenue, growing at 5% to 10%; State & Local = 15% of revenue, declining by 5% to 10%; International (Waldrop acquisition) = 5%, growing by > 100%.

The E&C-related spending in the Congressional stimulus proposals is someplace between $159 billion and $160 billion (close enough for government work). Of that, TTEK probably would be qualified to bid on between $46 billion to $58 billion worth of work, of which it hopes to be awarded at least $8 billion.

TTEK is looking down the tunnel, and the light at the other end is the stimulus package.

Read the full analyst report on TTEK

Read the full analyst report on TTEK