Dallas-based Jacobs Engineering is getting new leadership in the business division that manages its operations for the Department of Energy.
Terry Hagen, Jacobs’ chief operating officer and president for the Aerospace, Technology, and Nuclear group, will retire from leadership effective June 3.
He will be succeeded by Dawne Hickton, a former CEO and vice chair of RTI International, a titanium producer purchased by Alcoa in 2015. She has also served on the Jacobs board for four years, Chair and CEO Steve Demetriou said during the company’s quarterly earnings call Tuesday.
The business, which serves clients ranging from NASA to DOE, recorded more than $1 billion in revenue for the latest quarter, up from $923 million a year ago. The ATN segment’s operating profit landed at roughly $74 million for the first three months of the year, which is Jacobs’ second quarter for fiscal 2019. That was up from $52 million a year earlier.
During the call, Demetriou expressed optimism about Jacobs retaining the Central Plateau Cleanup contract at the Hanford Site in Washington state. Subsidiary CH2M, which Jacobs bought in December 2017, holds the current contract under a 12-month extension through Sept. 30. The follow-on has an estimated value of $7 billion to $12 billion over 10 years.
Jacobs is also a bidder for another upcoming Hanford award, the anticipated decade-long, $13 billion Tank Closure Contract, Hagen has said previously.
The Energy Department issued requests for proposals for both contracts in February. Demetriou said he expects awards before the current fiscal year ends Sept. 30.
“For the Hanford Central Plateau contract, where Jacobs is currently the majority JV partner we have submitted as a minority partner. If successful as a minority partner, we will only recognize our portion of a fee from the joint venture,” Demetriou said. “However, on the Hanford tank farms, we bid as the majority joint venture partner, which would be a new win and add material revenue and incremental operating income.”
A source in April identified Honeywell as Jacobs’ partner on the Tank Closure Contract bid, possibly also featuring Perma-Fix Environmental Services.
BWX Technologies also said recently it is competing for both contracts.
Through CH2M, Jacobs is a partner in AECOM-led Savannah River Remediation, which recently received an 18-month extension to remain in charge of liquid waste management at the Savannah River Site in South Carolina through September 2020.
Company-wide, Jacobs recorded $3.1 billion in revenue for the first three months of 2019, up 7.7% from the $2.9 billion the company took in for the same period of 2018.
Jacobs’ earnings per diluted share was $0.82, down from $0.86 year ago, according to its earnings release Tuesday. This was affected by costs associated with Jacobs’ purchase of CH2M.
The company’s backlog increased $1.5 billion to $20.7 billion during the quarter.
The company raised its earnings per share projection for the 2019 fiscal year to the $4.45 to $4.85 range, up from the prior guidance of $4.40 to $4.80 per share.
BWXT Not Sweating Cancellation of Savannah River Liquid Waste Procurement
Meanwhile, BWX Technologies said it is not fretting about the Energy Department’s February cancellation of the next liquid waste management procurement for Savannah River.
The company for a few months starting in October 2017 owned a chunk of the follow-on contract, which was terminated after the Government Accountability Office early in 2018 upheld a protest from an AECOM-CH2M bidding team. The Energy Department started over again with the three bidders, including a Fluor-Westinghouse partnership, but ultimately scrapped the proceeding in favor of the extension to the current contract.
Like Jacobs, Lynchburg, Va.-based BWXT still holds a piece of the current waste contract at SRS as a partner in Savannah River Remediation.
BWX Technologies is also optimistic about an additional contract “win,” as part of a joint venture at either the Hanford Tank Closure Contract or Central Plateau Cleanup Contract, Chief Financial Officer David Black said last week. “So, there are some other things out there that will help us,” Black said during the company’s May 2 quarterly earnings call.
Black did not discuss BWXT’s partners on the bids. Last month, the industry source said BWXT was teaming with Fluor on the tank contract.
