A weakness in the European and Middle East markets had an effect on overall results leading the company to reduce its workforce and consolidated offices.
Its net income had been US$287.9m in 2010. A net tax benefit in 2010 and costs associated with the Scott Wilson acquisition and integration costs meant that the 2010 EPS had been US$3.54 instead of the US$3.28 that it would have been otherwise.
The results for 2011 include a non-cash, after-tax charge for the impairment of goodwill of US$732.2m. This was primarily driven by adverse stock market conditions that caused a decrease in the company’s stock price leading up to the date on which URS conducted a test of the fair values of its assets versus their book values as required by accounting standards. The company said that the charge had no effect on URS’ business operations, cash balances or operating cash flows.
“URS’ North American operations performed well in 2011, with all of our US and Canadian operations either meeting or exceeding our expectations,” said chairman and CEO Martin Koffel. “While we generate the significant majority of our revenues in North America, our overall results for 2011 were affected by weakness in certain international markets, particularly Europe and the Middle East. During the fourth quarter, we reduced our workforce and consolidated systems and offices as a result of the turbulent economic conditions in these regions.”
He continued: “Our outlook for 2012 reflects favorable conditions in each of our four market sectors – federal, infrastructure, power, and industrial and commercial – particularly in North America. In addition, while not included in our 2012 guidance, our proposed acquisition of Flint Energy Services should position us well in attractive segments of the oil and gas industry, especially in North American oil, oil sands and gas. We expect to complete the acquisition in the second quarter of this year.”
The company’s backlog as of December 30 2011 was US$14.3bn, compared to US$16.6bn a year earlier.
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