Earnings fell at Jacobs, Dallas, in the second quarter of its fiscal 2024, which the international engineering and technical services company attributed to a $95-million share repurchase program.
Importantly, Jacobs also said in its Tuesday earnings release that it has major regulatory approvals in hand for the announced merger of its government contracting and cyber businesses with Amentum.
That deal, announced in November, remains on pace to close before the end of the fourth quarter of fiscal 2024, which ends Sept. 30.
Net earnings for the quarter ended March 29 were $163 million, or $1.29 a share, down from $217 million, or $1.70 a share, in the year-ago quarter. Quarterly revenue was $4.27 billion, up year-over-year from $4.08 billion.
Quarterly segment operating income for the Critical Mission Solutions segment, where Jacobs oversees much of its Department of Energy weapons complex work and which would merge with Amentum, was $104 million, up from $94 million a year ago. Segment revenue was $1.22 billion, up from $1.9 billion in the year-ago period.
“We continue to diligently execute on our commitments in relation to the separation of our CMS [Critical Mission Solutions] and Cyber & Intelligence business,” Jacobs’ CEO Bob Pragada said in the earnings release.
During its second quarter, Jacobs finished the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, which governs pre-merger public notices, the company said. Jacobs “has now also received all other approvals and clearances under competition and foreign direct investment laws which were conditions to the consummation of the separation transaction,” according to the earnings release. Currently, Jacobs expects the transaction to close, “in the second half of the fourth quarter of fiscal year 2024.”
The combination would create a new publicly-traded company. Jacobs has said the deal will be a reverse Morris Trust transaction meant to be tax-free to Jacobs’ shareholders for federal income tax purposes in the United States.
Jacobs is the lead partner on DOE environmental cleanup contracts at the Idaho National Laboratory and the Paducah Site in Kentucky. Both Jacobs and Amentum are minority partners in two teams litigating the award of a potential $45-billion liquid waste contract at the Hanford Site in Washington state.
