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URS Corp. (URS - Analyst Report) reported third-quarter fiscal 2011 loss per share of $8.05 compared with earnings per share of 87 cents in third-quarter 2010. The Zacks Digest Consensus Estimate for earnings per share were 99 cents.

During the quarter, the company recorded a goodwill impairment charge of $9.03 per share, resulting in a reported loss per share. The goodwill impairment charge is mainly led by adverse stock market conditions that led to a decrease in the company's stock price as of September 30, 2011. Excluding this charge, earnings per share would have been 98 cents in the quarter.

Total Revenue

Total revenue in the quarter was $2.47 billion compared with $2.34 billion in the prior-year quarter. The company continues to see positive trends in most of its operating markets. URS Corp.’s backlog was $16.0 billion at the end of the third quarter of 2011 compared with $16.6 billion as of December 31, 2010.

Segment Result

Infrastructure and Environment revenue in the quarter was $950.8 million compared with $818.2 million in the prior-year quarter. The segment revenue included $112.8 million contribution from Scott Wilson Group plc, acquired by URS in September 2010.

Federal Services revenue was $718.7 million compared with $645.2 million, aided by strong demand for URS’ specialized engineering and technical services. The federal segment revenue in the quarter included $78.6 million contribution from Apptis Holdings Inc., acquired in June 2011.

Energy and Construction revenue was $844.6 million compared with $898.6 million in the prior-year period.

Income and Expenses

As a result of goodwill impairment charge of $798.1 million, the company incurred an operating loss of $620.2 million compared with an operating profit of $162.2 million in the prior-year period. General and administrative expenses were $18.5 million compared with $21.5 million.

Balance Sheet and Cash Flow

Cash and cash equivalents were $427.1 million at the end of the third-quarter of 2011 compared with $573.8 million at the end of 2010. Long-term debt was $690.8 million compared with $641.3 million and shareowners equity was $3.62 billion compared with $4.20 billion at the end of 2010.


The company expects its 2011 revenue to be in the range of $9.6 billion to $9.8 billion and EPS in the range of $(5.30) to $(5.40). before the non-cash, after-tax goodwill impairment charge diluted EPS is expected to be in the range of $3.60 to $3.70, same as previously provided guidance.

URS Corp. was originally incorporated in California on May 1, 1957 as Broadview Research Corporation. On May 18, 1976, it was re-incorporated in Delaware under the name URS Corporation. The name “URS Corporation” was formally adopted on February 21, 1990. Major competitors of URS are AECOM Technology Corporation (ACM - Analyst Report), Fluor Corporation (FLR - Analyst Report) and KBR Inc. (KBR).

We currently maintain our Neutral rating on URS Corp. with a Zacks #4 Rank (short-term Sell recommendation) over the next one-to-three months.

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