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URS Corp. (URS - Analyst Report) reported fourth-quarter 2012 recurring earnings per share of 95 cents a share, 4.0% below the Zacks Consensus Estimate of 99 cents but soared 156.7% year over year. Profits during the quarter were primarily driven by strong activity in the company’s oil and gas business.

Earnings of $4.17 a share in full year 2012 were 0.5% higher than the Zacks Consensus Estimate of $4.15 a share, driven by strong business across the company’s segments and synergies from the acquisition of Flint Energy. During fiscal 2011, the company posted a loss of $6.03 a share due to goodwill impairment charges and restructuring related charges.

Total Revenue

Total revenue in the quarter was $2.97 billion, up 24.2% compared with $2.39 billion in the prior-year quarter. Revenue in the quarter was aided by strong performance of the federal sector and the oil and gas businesses.

Backlog at the end of 2012 was $13.2 billion compared with $14.3 billion at the end of Dec 30, 2011.

Segment Result

Infrastructure and Environment revenue in the quarter was $941.0 million, down 3.1% from $970.8 million in the prior-year quarter. The segment continues to bear the brunt of the slowdown in the Infrastructure market. However, there has been a steady recovery in the Infrastructure industry with new opportunities in highway, transit, airports and other public infrastructure projects.

Federal Services revenue was $603.5 million, down 17% from $726.8 million a year ago. The decline in the Federal services reflects the continuing delay in procurement decisions and reduction in anticipated spending against previously awarded contracts.

Energy and Construction revenue was $853.0 million, up 16.9% from $866.4 million in the prior-year period. The segment revenue was primarily driven by growth in the emission control projects, modification on nuclear facilities and transmission and distribution projects.

The Oil & Gas segment reported revenues of $605.4 million, driven by the Flint acquisition and the strong pipeline of EPC opportunities. In the fourth quarter, 29% of the consolidated revenues came from the oil & gas market, providing URS with the strategic balance for continued growth.

URS’ consolidated energy revenue (power and oil gas) contributed approximately 42% of the total revenue in the fourth quarter. 

Income and Expenses

Operating income in the quarter was $171.4 million, up 50.2% from $114.1 million in the prior-year quarter. General and administrative expenses were $21.6 million compared with $19.6 million a year ago.

Balance Sheet and Cash Flow

Cash and cash equivalents were $314.5 million as on December 28, 2012 compared with $436.0 million at the end of 2011. Long-term debt was $2.0 billion as on December 28, 2012 compared with $737 million and shareowners equity was $3.76 billion compared with $3.48 billion at the end of 2011.

Dividend

The board of directors approved a 5% increase in its regular quarterly cash dividend to 21 cents per common share. The dividend will be paid on Apr 5, 2013 to shareholders of record as of Mar 15, 2013.

Outlook

URS expects full year 2013 consolidated revenues to be between $11.8 billion and $12.2 billion. The company expects EPS to be between $4.25 and $4.75 a share, on a fully diluted basis.

URS Corporation currently has a Zacks Rank #3 (Sell). Its close rivals such as Quanta Services Inc. (PWR - Analyst Report) currently has a Zacks Rank #1 (Strong Buy) while Jacobs Engineering Group (JEC - Analyst Report) and Aecom Technology Corporation (ACM - Analyst Report) have a Zacks Rank #2 (Buy).

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