FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
( X ) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended April 30, 1994
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OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from ____________ to
____________
Commission file number 1-7567
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URS CORPORATION
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(Exact name of registrant as specified in its charter)
Delaware 94-1381538
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(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification No.)
100 California Street, Suite 500
San Francisco, California 94111-4529
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: 415-774-2700
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Indicate by check mark whether the registrant (1) has
filed all reports required to be filed by Section 13 or 15(d) of
the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
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Indicate the number of shares outstanding of each of
the issuer's classes of common stock, as of the latest
practicable date.
Class Outstanding at May 27, 1994
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Common stock, $.01 par value 7,005,048
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URS CORPORATION AND SUBSIDIARIES
PART I. FINANCIAL INFORMATION:
In the opinion of management, the information
furnished reflects all adjustments, consisting only of normal
recurring adjustments, which are necessary for a fair statement
of the interim financial information. Net earnings per share
computations are based upon the weighted average number of
common shares outstanding during the period plus shares issuable
under warrants and stock options that have a dilutive effect.
Certain information and footnote disclosures normally
included in financial statements prepared in accordance with
generally accepted accounting principles have been omitted.
These condensed financial statements should be read in
conjunction with the financial statements and notes thereto
included in the Company's Annual Report on Form 10-K for the
fiscal year ended October 31, 1993. The results of operations
for the three and six month periods ended April 30, 1994 are not
necessarily indicative of the operating results for the full
year.
Item 1. Financial Statements (unaudited)
Consolidated Balance Sheets
April 30, 1994 and October 31, 1993 . . . . . 2
Consolidated Statements of Operations
Three and six months ended April 30,
1994 and 1993 . . . . . . . . . . . . . . . . 3
Consolidated Statements of Cash Flows
Six months ended April 30, 1994 and 1993 . . . 4
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations . . . . . . . . . . . . . . . . . 5
PART II. OTHER INFORMATION:
Item 4. Submission of Matters to a
Vote of Security Holders . . . . . . . . . . . 7
Item 6. Exhibits and Reports on Form 8-K . . . . . . . 7
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PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
URS CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except per share data)
April 30, October 31,
1994 1993
ASSETS ---- ----
(unaudited)
Current assets:
Cash $ 4,641 $ 6,628
Accounts receivable, less allowance for
doubtful accounts of $874 and $665 30,584 27,157
Costs and accrued earnings in excess of
billings on contracts in process, less
allowances for losses of $389 and $416 10,852 11,783
Prepaid expenses and other 1,048 955
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Total current assets 47,125 46,523
Property and equipment at cost, net 4,602 4,596
Goodwill, net 5,023 5,260
Other assets 781 1,695
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$57,531 $58,074
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Accounts payable $ 7,088 $ 8,078
Accrued salaries and wages 4,588 3,574
Accrued expenses 4,562 7,187
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Total current liabilities 16,238 18,839
Long-term debt, including related parties 8,483 8,277
Deferred compensation and other 1,662 1,569
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Total liabilities 26,383 28,685
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Shareholders' equity:
Common shares, par value $.01; authorized
20,000 shares; issued 7,005 and 6,989 shares 70 70
Additional paid-in capital 29,097 28,365
Retained earnings since February 21,
1990, date of quasi-reorganization 1,981 954
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Total shareholders' equity 31,148 29,389
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$57,531 $58,074
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URS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
Three months ended Six months ended
April 30, April 30,
1994 1993 1994 1993
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(unaudited) (unaudited)
Revenues $40,520 $36,585 $77,276 $69,542
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Expenses:
Direct operating 24,751 22,691 47,579 42,704
Indirect, general
and administrative 14,285 12,418 27,163 24,354
Interest expense, net 328 280 657 586
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39,364 35,389 75,399 67,644
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Income before taxes 1,156 1,196 1,877 1,898
Income tax expense 140 120 210 190
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Net income $ 1,016 $ 1,076 $ 1,667 $ 1,708
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Net income per share:
Primary $ .14 $ .14 $ .24 $ .22
Fully diluted ====== ====== ====== ======
$ .14 $ .14 $ .23 $ .22
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URS CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
Six Months Ended
April 30,
1994 1993
---- ----
(unaudited)
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income $ 1,667 $ 1,708
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Adjustment to reconcile net income to net
cash provided (used) by operating
activities:
Depreciation and amortization 1,151 1,305
Changes in current assets and liabilities:
(Increase) decrease in accounts receivable
and costs and accrued earnings in excess
of billings on contracts in process (2,496) 567
Increase in prepaid expenses (93) (92)
Decrease in accounts payable, accrued
salaries and wages and accrued expenses (2,616) (4,292)
Other, net 25 688
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Total adjustments (4,029) (1,824)
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Net cash used by operating activities (2,362) (116)
CASH FLOWS FROM INVESTING ACTIVITIES:
Capital expenditures (700) (1,130)
Other - (400)
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Net cash used by investing activities (700) (1,530)
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CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from sale of common shares 75 71
Repurchase of January Notes - (1,340)
Other 1,000 -
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Net cash provided (used) by financing
activities 1,075 (1,269)
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Net decrease in cash (1,987) (2,915)
Cash at beginning of period 6,628 5,729
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Cash at end of period 4,641 $ 2,814
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SUPPLEMENTAL INFORMATION:
Interest paid 629 $ 567
Taxes paid 84 289
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$ 713 $ 856
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URS CORPORATION AND SUBSIDIARIES
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
The Company reports the results of its operations on
a fiscal year which ends on October 31. This Management
Discussion and Analysis (MD&A) should be read in conjunction
with the MD&A and the footnotes to the Consolidated Financial
Statements included in the Annual Report on Form 10-K for the
fiscal year ended October 31, 1993 which was previously filed
with the Securities and Exchange Commission.
RESULTS OF OPERATIONS
Second quarter ended fiscal 1994 vs. fiscal 1993.
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The Company's revenues were $40,520,000 for the
second quarter ended April 30, 1994, an increase of $3,935,000
or 11% over the amount reported for the same period last year.
The growth in revenue is generally attributable to an increase
in demand for the Company's services, on both infrastructure
and environmental projects. The revenues generated from the
Company's three largest indefinite delivery contracts, the Navy
CLEAN, EPA ARCS 9 & 10, and EPA ARCS 6, 7 & 8 contracts, were
$9,874,000 for the quarter ended April 30, 1994, compared to
$10,045,000 for the same period last year.
Direct operating expenses for the quarter ended
April 30, 1994, which consist of direct labor and other direct
expenses, including subcontractor costs, increased $2,060,000,
a 9% increase over the amount reported for the same period last
year. This increase is due to increases in subcontractor costs
and direct labor costs.
Indirect, general and administrative expenses for the
quarter ended April 30, 1994 increased $1,867,000, or 15% over
the amount reported for the same period last year as a result
of an increase in business activity.
The Company earned $1,156,000 before income taxes for
the second quarter ended April 30, 1994 compared to $1,196,000
for the same period last year. For Federal income tax
purposes, the Company has available net operating loss
carryforwards which off-set otherwise taxable income. For
state income tax purposes, net operating loss carryforwards are
not necessarily available to off-set income subject to tax.
Accordingly, the Company's effective income tax rate for the
quarter ended April 30, 1994 was approximately 12%.
The Company reported net income of $1,016,000, or
$.14 per share for the second quarter ended April 30, 1994,
compared with $1,076,000, or $.14 per share for the same period
last year.
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Six months ended fiscal 1994 vs. fiscal 1993.
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The Company's revenues were $77,276,000 for the six
months ended April 30, 1994, an increase of $7,734,000, or 11%
over the amount reported for the same period last year. The
growth in revenues is attributable to all areas of the
Company's business including infrastructure projects involving
transportation systems, institutional and commercial facilities
and environmental projects. The revenues generated from the
Company's three largest indefinite delivery contracts (Navy
CLEAN, EPA ARCS 9 & 10 and EPA ARCS 6, 7 & 8) were $17,929,000
for the six months ended April 30, 1994, compared to
$19,723,000 for the same period last year.
Direct operating expenses for the six months ended
April 30, 1994, which consist of direct labor and other direct
expenses including subcontractor costs, increased $4,875,000,
or 11% over the amount reported in the same period last year.
This increase is attributable to the overall increase in the
Company's business as compared to the same period last year.
Indirect, general and administrative expenses were $27,163,000
for the six months ended April 30, 1994, an increase of
$2,809,000, or 12% over the amount reported for the same period
last year. The increase in indirect, general and adminis-
trative expenses is due to an increase in business activity.
The Company earned $1,877,000 before income taxes for
the six months ended April 30, 1994 compared to $1,898,000 for
the same period last year. For Federal income tax purposes,
the Company has available net operating loss carryforwards to
off-set income. For state income tax purposes, such amounts
are not necessarily available to off-set income subject to tax.
Accordingly, the Company's effective income tax rate for the
six months ended April 30, 1994 is approximately 11%.
The Company reported net income of $1,667,000, or
$.23 per share, for the six months ended April 30, 1994,
compared with $1,708,000, or $.22 per share for the same period
last year.
The Company's backlog at April 30, 1994 was
$173,218,000, as compared to $142,000,000 at October 31, 1993.
LIQUIDITY AND CAPITAL RESOURCES
At April 30, 1994, the Company had working capital of
$30,887,000, an increase of $3,203,000 from October 31, 1993.
The Company also has $9,800,000 in available borrowing capacity
under its bank line of credit. It did not borrow on this line
in the six months ended April 30, 1994.
The Company believes that its existing financial
resources, together with its planned cash flow from operations
and its unused bank line of credit, will provide sufficient
capital to fund its operations and its capital needs for fiscal
1994.
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PART II
OTHER INFORMATION
ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
At the Company's regularly scheduled annual meeting,
held on March 22, 1994, the stockholders approved the
(i) retention of Coopers & Lybrand as the Company's independent
auditors for the 1994 fiscal year, with stockholders holding
5,768,417 shares voting in favor, stockholders holding 8,920
shares voting against, and stockholders holding 19,303 shares
abstaining from voting, and (ii) election of each of the
following nominees as directors of the Company by the following
vote:
For Withheld
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Richard C. Blum 5,744,322 1,250
Emmet J. Cashin Jr. 5,745,083 489
Martin M. Koffel 5,745,128 444
Richard B. Madden 5,745,161 411
Richard Q. Praeger 5,744,841 731
Irwin L. Rosenstein 5,744,767 805
Michael B. Shane 5,744,599 973
William D. Walsh 5,744,571 1,001
No stockholders abstained from voting in this
election of directors.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(a) Exhibits
None
(b) No reports on Form 8-K were filed during the
quarter ended April 30, 1994.
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SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned thereunto
duly authorized.
Dated June 13, 1994
URS CORPORATION
/s/ Kent Ainsworth
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Kent P. Ainsworth
Vice President and
Chief Financial Officer
(Principal Accounting Officer)
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