Quarterly revenue and segment income grew year over year for the AECOM business unit that conducts nuclear cleanup work for the Energy Department’s Office of Environmental Management, the Los Angeles-based engineering services giant said Tuesday.
Quarterly revenue for AECOM’s Management Services division recorded revenue of just over $765 million for the fiscal first-quarter 2017 ended Dec. 30, up a little more than 1 percent for the same period of fiscal 2016, according to the company’s latest earnings release. The segment’s operating income rose to almost $75 million, a roughly 7 percent gain.
Management Services’ first-quarter operating income included a $35-million “benefit from legal proceedings” related to the $57.5 million charge AECOM paid Nov. 23 to settle allegations the company spent federal dollars on non-nuclear-certified parts and services for the Waste Treatment Plant under construction at the Hanford Site in Washington state. In its fiscal 2016 10-K filing with the U.S. Securities and Exchange Commission, AECOM said it had set aside more money for the settlement than it wound up paying to the Justice Department, and that the savings would result in a future earnings bump.
AECOM became a major subcontractor to Bechtel National on the Waste Treatment Plant when it acquired URS Corp. in 2014. The misuse of federal funds allegedly occurred before the acquisition. Bechtel also paid a $67.5 million settlement; both companies denied any wrongdoing.
AECOM’s latest earnings presser was otherwise short on details about the revenue and income contributions of the company’s Cold War cleanup contracts with DOE. This work represented about a quarter of the $3-billion-plus in revenue the segment pulled in during the 2016 fiscal year that ended Sept. 30.
Outside of DOE’s legacy cleanup project, AECOM’s Construction Services division booked a massive win in its fiscal first quarter, hauling in a 10-year, roughly $1-billion contract from Southern California Edison for decommissioning of the San Onofre Nuclear Generating Station in Pendleton, Calif., as part of a joint venture with EnergySolutions of Salt Lake City.
