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AECOM leaders are confident in the infrastructure sector and the potential for additional permitting reforms under the incoming Trump administration.
In an earnings call Tuesday, Chief Executive Troy Rudd said most of the Jobs and Infrastructure Investment Act funding is not at risk and noted that voters continued to demonstrate. infrastructure financing support in the November state and local elections.
“First of all, elections create certainty. Infrastructure investment is a bipartisan priority and we don’t foresee that changing,” Rudd said on the call. “While specific initiatives and targets may change, with 70% of our workforce expendable in market sectors , we are in a great position to capitalize on investments in the US economy.”
Troy Rudd
Authorization granted by AECOM
Rudd also cited opportunities for growth arising from the new administration. For example, a reduction in government funding promoted by President-elect Donald Trump would increase demand for technical advisory and program management services to support infrastructure investment.
“Prudent deregulation is positive for our customers and our business,” Rudd said. “This includes authorizing reform, which is one of the biggest bottlenecks for infrastructure investment and simplification would increase the volume of project opportunities.”
AECOM also completed the acquisition of EMPSi, an environmental permitting practice based in Boulder, Colorado centered on federal landwhich is an opportunity for rapid growth under the incoming Trump administration, according to CFO and COO Gaurav Kapoor.
Fiscal year 2024 and Q4 numbers
Despite some impacts from Hurricanes Helene and Milton, AECOM posted higher revenue, profit and portfolio in its fiscal year and fourth quarter earnings report
The company’s revenue for its fiscal year, which ended Sept. 30, was $16.1 billion, up 12% from 2023. Revenue was $4.11 billion in the fourth quarter, 7% more than the same period last year.
AECOM reported an annual profit of $402.3 million, up 627% from the previous year. For the fourth quarter, profits were $172.5 million, up 577% from the fourth quarter of 2023. These big percentages come in part from lower profits last year.
Backlog for the quarter was $23.9 million, up 3% year-over-year, and Rudd said the company’s pipeline hit a new high.
AECOM also successfully resolved two legacy project disputes, resulting in a gross cash infusion of approximately $130 million, Kapoor said.
While company leaders will continue to make investments in the business, they do not plan to seek major acquisitions in fiscal 2025, according to Rudd.
“We’re focused on growing the business organically,” Rudd said. “When you look at making an acquisition in today’s market, the prices are very expensive, and so just in terms of a return model, it doesn’t make sense to do it.”
Hot sectors
Like the aging of the United States infrastructure continues to suffer damage due to extreme times, Rudd said the need for investment in the sector has never been greater.
This is a worldwide trend: urbanization is transforming demand for infrastructure around the world, Rudd said, creating “huge investment demand for safe and reliable drinking water and to build modern transport systems at the same time which minimizes environmental impacts”.
To this end, AECOM has recently launched a consultancy business in water and environment and named head of Jill Hudkins. It expands the company’s capabilities in high-growth areas such as advanced digital water asset management and automation, environmental permitting, per- and polyfluoroalkyl substances (PFAS) remediation, and water solutions in water environments. high technology
“A great example of the opportunity is digital water, which is a $70 billion opportunity through 2030,” said President Lara Poloni. “In the United States alone, there are 500 municipal water utilities serving populations of more than 500,000 people, and each requires substantial digital investments to modernize operations, incorporate predictive analytics and cybersecurity, and drive process efficiencies.”
Rudd said he expects that business to double within three years.
Demand for power for electrification and data centers to support artificial intelligence is also creating opportunities for the company, Rudd said. These include permitting work, air quality, energy storage and grid modernization.
