Jacobs Engineering Group Inc ( JEC - Analyst Report ) reported strong fiscal fourth-quarter and full year 2012 (ending September 28, 2012) financial results. Though earnings came in better than expected, both the quarter’s and fiscal 2012 revenues fell short of the Zacks Consensus Estimate.

The company reported fourth quarter earnings per share of 83 cents, beating the Zacks Consensus Estimate of 80 cents. The quarterly earnings also improved 12.2% from the year-ago earnings of 74 cents a share.

Fiscal 2012 earnings came in at $2.94 per share, beating the Zacks Consensus Estimate of $2.91 by 1%. Earnings for fiscal 2012 also increased from the 2011 earnings of $2.60 by 13%.

The company generated a one-time gain of $6.3 million on sale of its intellectual property for iron ore palletizing and other related assets. Excluding this impact, the company’s non-GAAP earnings in the reported quarter were 80 cents, whereas earnings in fiscal 2012 were $2.91, both in line with the Zacks Consensus Estimate.

Revenue

Revenue increased 2.6% year over year to $2.72 billion in the reported quarter. However, it fell short of the Zacks Consensus Estimate of $2.87 billion by 5.7%. Revenue for fiscal 2012 came in at $10.89 billion, an increase of 4.91% compared with 2011. It was 0.9% lower than the Zacks Consensus Estimate of $10.99 billion.

Technical Professional Services revenue came in at $1.63 billion, increasing 2.24% from the year-ago quarter. However, the segment’s revenue increased 9.8% to $6.46 billion in fiscal 2012.

Field Services revenue in fourth quarter was $1.15 billion, up 2.4% from fourth quarter 2011. However, revenue in fiscal 2012 slipped 1.5% from fiscal 2011 to $4.43 billion.

Costs

During the reported quarter, direct costs of contracts, a major expenditure for Jacobs, edged up 1.86% from the year-ago quarter to settle at $2,339.6 million. Selling, general and administrative (SG&A) expenses came in at $279.0 million, up 0.13% year over year.

Operating profit improved to $167.6 million, an increase of 13.3% over the year-ago quarter.

Backlog

Exiting the fourth quarter, backlog stood at $15.9 billion, an increase of 11.3% from $14.3 billion in the year-ago quarter. It includes backlog from technical professional services of $10.3 billion versus $9.1 billion at the end of the fourth quarter of 2011.

The company has won a number of contracts in the quarter, including contracts to support NASA Marshall Space Flight Center (on July 24, 2012, worth $600 million), a contract from CODELCO to provide engineering services for a copper mine in Chile (on August 8, 2012, estimated total installed cost $4.5 billion) and contract from Methanex to provide engineering, procurement and construction services in Louisiana (on August 14, 2012, worth $550 million), among others.

Balance Sheet

Jacobs’ cash and cash equivalents at the end of fourth quarter were approximately $1,032 million, up 14.0% year over year. Total debt decreased 7.5% from the previous-year quarter to $528.3 million as of September 28, 2012.

Outlook

Based on improvement across most markets, encouraging backlog, increased margins and a stronger balance sheet, Jacobs expects earnings for fiscal 2013 between $3.00 and $3.50 per share. Improved earnings in 2012 also allowed management initiate the fiscal 2013 guidance.

The company competes against industry players including Fluor Corporation ( FLR - Analyst Report ) and Foster Wheeler AG ( FWLT - Analyst Report ) . We currently maintain a Neutral recommendation on Jacobs. The stock also bears a Zacks #3 Rank, which implies a short-term (1-3 months) Hold rating.