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Released November 16, 2016 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--The results of last week's U.S. presidential election have done little to heal the country's many deep divisions, but one engineering, procurement and construction (EPC) company certainly has a positive outlook: AECOM Technology Corporation (NYSE:ACM) (Los Angeles, California), which sees myriad opportunities from the infrastructure projects and reduced energy regulations that could emerge from a new administration. Industrial Info is tracking $82.72 billion in active projects involving AECOM.
On the campaign trail, President-elect Donald Trump vowed to spend $1 trillion over 10 years on various infrastructure projects if elected, which is music to the ears of a company that has had more than $10 billion in government contracts awarded to it since 2007. And even if Trump's plan falls short or doesn't pass at all, AECOM executives are optimistic about $200 billion in infrastructure projects that were approved by voters via state ballot initiatives on November 8. Higher gasoline taxes in 20 states also are expected to drive domestic spending.
"I don't think we've ever been more bullish on the future of infrastructure in North America than we are right now," said Mike Burke, the chairman and chief executive officer of AECOM, in a quarterly earnings conference call. "We were tracking about $230 billion in ballot measures across the United States, and $200 billion of them passed--led by one of the largest that we had a significant involvement in, which is a $120 billion measure in Los Angeles, our home city, where we have an incredibly strong position to take advantage of that spend. But we also have seen 20 states that have increased gas taxes, most recently in New Jersey--again, a state where we have a significant presence."
AECOM executives also expect to see a "change in direction" on energy policy, such as the Keystone pipeline, which they said could present opportunities for the company's oil & gas businesses. "If we see some of these regulatory changes on the Keystone pipeline and others, we could see a resurgence in capital expenditures in the oil and gas sector in 2017 and forward," said Troy Rudd, AECOM's chief financial officer, in the earnings call. For more information, see November 11, 2016, article - Trump Election Raises Hopes for Keystone XL.
More than $6 billion of the active AECOM projects tracked by Industrial Info are in the Oil & Gas Pipeline Industry. The largest is unlikely to begin construction for a long time, if it does at all: Exxon Mobil Corporation (NYSE:XMO) (Irving, Texas) and TransCanada Corporation's (NYSE:TRP) (Calgary, Alberta) proposed $5.5 billion natural gas pipeline from Alaska's North Slope to the Kenai Peninsula, which is related to Chevron Corporation's (NYSE:CVX) (San Ramon, California) $45 billion-to-$65 billion Alaska LNG Project, which would produce liquefied natural gas (LNG) and ship it to overseas markets. Although the project has made headway in receiving government approvals for exports, the ongoing global glut in liquefied natural gas (LNG) puts the project out of economic reach. For more information, including capacities, measurements, operating pressure, major components and contractor contact information, see Industrial Info's project report.
Still, reduced regulations could speed up some of the pipeline projects involving AECOM that have graduated from the planning phases, such as Williams Partners LP's (NYSE:WPZ) (Tulsa, Oklahoma) $65 million addition of a natural gas compressor station for the Transcontinental Gas Pipeline near Parlin, New Jersey. The segment of the massive pipeline served provides 115 million standard cubic feet per day of natural gas from Middlesex County, New Jersey, to Keyport, New Jersey. For more information, see Industrial Info's project report.
But AECOM wouldn't necessarily benefit if other regulations were pared too far, as it is involved in several major retrofits under way at coal-fired power plants across the country, the largest being the $1 billion installation of pollution-control equipment at the Gallatin Power Station in Gallatin, Tennessee; the $320 million addition of similar equipment at the Weston Power Station in Rothschild, Wisconsin; and $200 million in additions at the Shawnee Power Station in West Paducah, Kentucky. The facilities must comply with regulations such as the Mercury Air Toxics Standards (MATS) and the Cross-State Air Pollution Rule (CSAPR).
Each of these projects is being performed by an engineering, procurement and construction (EPC) subsidiary that was formed after AECOM acquired URS Corporation in 2014. The Tennessee and Kentucky plants are owned by the Tennessee Valley Authority, while the Wisconsin plant is owned by Wisconsin Public Service Corporation. For more information, see Industrial Info's project reports on the Tennessee, Wisconsin and Kentucky retrofits.
AECOM reported $6.3 billion in contract wins during the quarter, including more than $700 million from clients in the Oil & Gas Industry. Total backlog increased 4% from the third quarter to $42.8 billion. The company was in need of the good news: Revenues fell 8.5% from the same period last year to $4.32 billion, while net incomes fell 51.3% to $12.88 million. Burke blamed the weak results on "uneven client spending in our Americas Design business, continued market pressures from low oil and gas prices, and lower than anticipated earnings contributions from the sizable power and industrial construction wins in the second half of the year due to the timing."
Other plans from AECOM include some more recognizable landmarks: During the quarter, the company received a contract of more than $1 billion to build a new stadium for the Los Angeles Rams, and it is among the bidders for project management work to overhaul the Palace of Westminster in London, England.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
On the campaign trail, President-elect Donald Trump vowed to spend $1 trillion over 10 years on various infrastructure projects if elected, which is music to the ears of a company that has had more than $10 billion in government contracts awarded to it since 2007. And even if Trump's plan falls short or doesn't pass at all, AECOM executives are optimistic about $200 billion in infrastructure projects that were approved by voters via state ballot initiatives on November 8. Higher gasoline taxes in 20 states also are expected to drive domestic spending.
"I don't think we've ever been more bullish on the future of infrastructure in North America than we are right now," said Mike Burke, the chairman and chief executive officer of AECOM, in a quarterly earnings conference call. "We were tracking about $230 billion in ballot measures across the United States, and $200 billion of them passed--led by one of the largest that we had a significant involvement in, which is a $120 billion measure in Los Angeles, our home city, where we have an incredibly strong position to take advantage of that spend. But we also have seen 20 states that have increased gas taxes, most recently in New Jersey--again, a state where we have a significant presence."
AECOM executives also expect to see a "change in direction" on energy policy, such as the Keystone pipeline, which they said could present opportunities for the company's oil & gas businesses. "If we see some of these regulatory changes on the Keystone pipeline and others, we could see a resurgence in capital expenditures in the oil and gas sector in 2017 and forward," said Troy Rudd, AECOM's chief financial officer, in the earnings call. For more information, see November 11, 2016, article - Trump Election Raises Hopes for Keystone XL.
More than $6 billion of the active AECOM projects tracked by Industrial Info are in the Oil & Gas Pipeline Industry. The largest is unlikely to begin construction for a long time, if it does at all: Exxon Mobil Corporation (NYSE:XMO) (Irving, Texas) and TransCanada Corporation's (NYSE:TRP) (Calgary, Alberta) proposed $5.5 billion natural gas pipeline from Alaska's North Slope to the Kenai Peninsula, which is related to Chevron Corporation's (NYSE:CVX) (San Ramon, California) $45 billion-to-$65 billion Alaska LNG Project, which would produce liquefied natural gas (LNG) and ship it to overseas markets. Although the project has made headway in receiving government approvals for exports, the ongoing global glut in liquefied natural gas (LNG) puts the project out of economic reach. For more information, including capacities, measurements, operating pressure, major components and contractor contact information, see Industrial Info's project report.
Still, reduced regulations could speed up some of the pipeline projects involving AECOM that have graduated from the planning phases, such as Williams Partners LP's (NYSE:WPZ) (Tulsa, Oklahoma) $65 million addition of a natural gas compressor station for the Transcontinental Gas Pipeline near Parlin, New Jersey. The segment of the massive pipeline served provides 115 million standard cubic feet per day of natural gas from Middlesex County, New Jersey, to Keyport, New Jersey. For more information, see Industrial Info's project report.
But AECOM wouldn't necessarily benefit if other regulations were pared too far, as it is involved in several major retrofits under way at coal-fired power plants across the country, the largest being the $1 billion installation of pollution-control equipment at the Gallatin Power Station in Gallatin, Tennessee; the $320 million addition of similar equipment at the Weston Power Station in Rothschild, Wisconsin; and $200 million in additions at the Shawnee Power Station in West Paducah, Kentucky. The facilities must comply with regulations such as the Mercury Air Toxics Standards (MATS) and the Cross-State Air Pollution Rule (CSAPR).
Each of these projects is being performed by an engineering, procurement and construction (EPC) subsidiary that was formed after AECOM acquired URS Corporation in 2014. The Tennessee and Kentucky plants are owned by the Tennessee Valley Authority, while the Wisconsin plant is owned by Wisconsin Public Service Corporation. For more information, see Industrial Info's project reports on the Tennessee, Wisconsin and Kentucky retrofits.
AECOM reported $6.3 billion in contract wins during the quarter, including more than $700 million from clients in the Oil & Gas Industry. Total backlog increased 4% from the third quarter to $42.8 billion. The company was in need of the good news: Revenues fell 8.5% from the same period last year to $4.32 billion, while net incomes fell 51.3% to $12.88 million. Burke blamed the weak results on "uneven client spending in our Americas Design business, continued market pressures from low oil and gas prices, and lower than anticipated earnings contributions from the sizable power and industrial construction wins in the second half of the year due to the timing."
Other plans from AECOM include some more recognizable landmarks: During the quarter, the company received a contract of more than $1 billion to build a new stadium for the Los Angeles Rams, and it is among the bidders for project management work to overhaul the Palace of Westminster in London, England.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
