<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Quarterly Report on
FORM 10-Q
(Mark one)
(X) Quarterly Report Pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934
For the quarterly period ended December 31, 1998
-----------------
( ) 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 1-7463
JACOBS ENGINEERING GROUP INC.
- --------------------------------------------------------------------------------
(Exact name of Registrant as specified in its charter)
Delaware 95-4081636
- --------------------------------------------------------------------------------
(State of incorporation) (I.R.S. employer identification number)
1111 South Arroyo Parkway, Pasadena, California 91105
- -------------------------------------------------------------------------------
(Address of principal executive offices) (Zip code)
(626) 578 - 3500
- --------------------------------------------------------------------------------
(Registrant's telephone number, including area code)
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:
(X) YES - ( ) NO
Number of shares of common stock outstanding at February 10, 1999: 25,674,728
Page 1
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JACOBS ENGINEERING GROUP INC.
INDEX TO FORM 10-Q
<TABLE>
<CAPTION>
Page No.
--------
- --------------------------------------------------------------------------------
<S> <C> <C>
Part I - Financial Information
Item 1. Financial Statements:
Consolidated Condensed Balance
Sheets as of December 31, 1998
and September 30, 1998 3
Consolidated Condensed Statements
of Income for the Three Months
Ended December 31, 1998 and 1997 4
Consolidated Condensed Statements of
Cash Flows for the Three Months
Ended December 31, 1998 and 1997 5
Notes to Consolidated Condensed
Financial Statements 6 - 8
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of
Operations 9 - 12
Part II - Other Information
Item 4. Submission of Matters to a Vote of
Security Holders 12 - 13
Item 6. Exhibits and Reports on Form 8-K 13
Signatures 13
</TABLE>
Page 2
<PAGE>
Part I - FINANCIAL INFORMATION
Item 1. Financial Statements
JACOBS ENGINEERING GROUP INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(In thousands, except share information)
(Unaudited)
<TABLE>
<CAPTION>
December 31, September 30,
1998 1998
------------- --------------
<S> <C> <C>
ASSETS
Current Assets:
Cash and cash equivalents $114,155 $101,328
Marketable securities 37 16,482
Receivables 399,698 394,841
Deferred income taxes 45,416 45,419
Prepaid expenses and other 9,221 7,937
- ---------------------------------------------- -------- --------
Total current assets 568,527 566,007
- ---------------------------------------------- -------- --------
Property, Equipment and Improvements, Net 106,273 100,565
- ---------------------------------------------- -------- --------
Other Noncurrent Assets:
Goodwill, net 74,923 77,246
Other 65,067 63,671
- ---------------------------------------------- -------- --------
Total other noncurrent assets 139,990 140,917
- ---------------------------------------------- -------- --------
$814,790 $807,489
======== ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities:
Notes payable $ 280 $ 217
Accounts payable 111,143 101,846
Accrued liabilities 153,240 161,552
Customers' advances in excess of
related revenues 77,491 85,049
Income taxes payable 23,362 19,684
- ---------------------------------------------- -------- --------
Total current liabilities 365,516 368,348
- ---------------------------------------------- -------- --------
Long-term Debt 23,640 26,221
- ---------------------------------------------- -------- --------
Other Deferred Liabilities 33,902 35,170
- ---------------------------------------------- -------- --------
Minority Interests 6,523 6,345
- ---------------------------------------------- -------- --------
Commitments and Contingencies
- ----------------------------------------------
Stockholders' Equity:
Capital stock:
Preferred stock, $1 par value,
authorized - 1,000,000 shares,
issued and outstanding - none - -
Common stock, $1 par value,
authorized - 60,000,000 shares,
issued - 25,864,832 shares and
25,866,795 shares, respectively 25,865 25,867
Additional paid-in capital 56,080 55,698
Retained earnings 314,899 300,296
Other (4,939) (2,856)
- ---------------------------------------------- -------- --------
391,905 379,005
Less, cost of common stock held
in treasury (223,792 shares and
254,028 shares, respectively) 6,696 7,600
- ---------------------------------------------- -------- --------
Total stockholders' equity 385,209 371,405
- ---------------------------------------------- -------- --------
$814,790 $807,489
================================================================================
</TABLE>
See the accompanying notes.
Page 3
<PAGE>
JACOBS ENGINEERING GROUP INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF INCOME
For the Three Months Ended December 31, 1998 and 1997
(In thousands, except per-share information)
(Unaudited)
<TABLE>
<CAPTION>
1998 1997
- --------------------------------------------------------------------------------
<S> <C> <C>
Revenues $555,172 $506,359
- --------------------------------------------------------------------------------
Costs and Expenses:
Direct costs of contracts 486,852 440,787
Selling, general and administrative expenses 45,155 45,322
Interest income, net (982) (686)
Other (income) expense, net 93 (65)
- --------------------------------------------------------------------------------
531,118 485,358
-------------------------------------------------------------------------------
Income before taxes 24,054 21,001
- --------------------------------------------------------------------------------
Income Tax Expense 8,899 8,191
- --------------------------------------------------------------------------------
Net Income $ 15,155 $ 12,810
================================================================================
Net Income Per Share:
Basic $ .59 $ .50
Diluted $ .58 $ .49
================================================================================
</TABLE>
See the accompanying notes.
Page 4
<PAGE>
JACOBS ENGINEERING GROUP INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENTS OF CASH FLOWS
For the Three Months Ended December 31, 1998 and 1997
(In thousands)
(Unaudited)
<TABLE>
<CAPTION>
1998 1997
- --------------------------------------------------------------------------
<S> <C> <C>
Cash Flows from Operating Activities:
Net income $ 15,155 $ 12,810
Adjustments to reconcile net income
to net cash flows from operations:
Depreciation and amortization 6,029 5,269
Amortization of deferred gains - (205)
Changes in assets and liabilities, net:
Receivables (2,616) (10,873)
Prepaid expenses and other
current assets (1,364) (221)
Accounts payable 9,580 8,020
Accrued liabilities (8,250) (19,055)
Customers' advances (7,238) 12,907
Income taxes payable 3,687 7,156
Deferred income taxes 3 15
Other, net 100 5
- -------------------------------------------------------------------------
Net cash provided 15,086 15,828
- -------------------------------------------------------------------------
Cash Flows from Investing Activities:
Additions to property and equipment, net
of disposals (11,348) (7,665)
Proceeds from sales of marketable securities 16,445 -
Purchases of investments and marketable
securities (72) (4,211)
Net increase in other noncurrent assets (4,310) (572)
- -------------------------------------------------------------------------
Net cash provided (used) 715 (12,448)
- -------------------------------------------------------------------------
Cash Flows from Financing Activities:
Exercises of stock options, including the
related income tax benefits 527 125
Decrease in bank borrowings, net (2,339) (933)
Change in other deferred liabilities, net (57) 1,460
Purchases of treasury stock - (4,300)
- -------------------------------------------------------------------------
Net cash used (1,869) (3,648)
- -------------------------------------------------------------------------
Effect of Exchange Rate Changes (1,105) 407
- -------------------------------------------------------------------------
Increase in Cash and Cash Equivalents 12,827 139
Cash and Cash Equivalents at the Beginning
of the Period 101,328 55,992
- -------------------------------------------------------------------------
Cash and Cash Equivalents at the End
of the Period $114,155 $ 56,131
=========================================================================
</TABLE>
See the accompanying notes.
Page 5
<PAGE>
JACOBS ENGINEERING GROUP INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
December 31, 1998
1. The accompanying consolidated condensed financial statements and financial
information included herein have been prepared by the Company, without
audit, pursuant to the interim period reporting requirements of Form 10-Q.
Consequently, certain information and note disclosures normally included in
financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. Readers of this
report should refer to the consolidated financial statements and the notes
thereto incorporated into the Company's latest Annual Report on Form 10-K.
In the opinion of the Company, the accompanying unaudited
consolidated condensed financial statements contain all adjustments
(consisting of only normal recurring adjustments) necessary for the fair
presentation of its consolidated financial position at December 31, 1998
and September 30, 1998, and its consolidated results of operations and cash
flows for the three months ended December 31, 1998 and 1997.
The Company's interim results of operations are not necessarily
indicative of the results to be expected for the full year.
2. Included in receivables at December 31, 1998 and September 30, 1998 were
unbilled amounts totaling $98,419,800 and $106,072,200, respectively.
3. Property, equipment and improvements are stated at cost and consisted of
the following at December 31, 1998 and September 30, 1998 (in thousands):
<TABLE>
<CAPTION>
December 31, September 30,
1998 1998
- ----------------------------------------------------------------------
<S> <C> <C>
Land $ 11,560 $ 11,416
Buildings 33,694 33,440
Equipment 139,511 133,379
Leasehold improvements 10,651 10,642
Construction in progress 15,912 12,595
- ----------------------------------------------------------------------
211,328 201,472
Accumulated depreciation
and amortization (105,055) (100,907)
- ----------------------------------------------------------------------
$ 106,273 $ 100,565
======================================================================
</TABLE>
Page 6
<PAGE>
JACOBS ENGINEERING GROUP INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
December 31, 1998
4. Other assets consisted of the following at December 31, 1998 and September
30, 1998 (in thousands):
<TABLE>
<CAPTION>
December 31, September 30,
1998 1998
- -----------------------------------------------------------------------
<S> <C> <C>
Prepaid pension costs $11,553 $11,929
Cash surrender value of life
insurance policies 27,131 26,920
Investments 17,209 20,277
Notes receivable 5,443 1,785
Miscellaneous 3,731 2,760
- -----------------------------------------------------------------------
$65,067 $63,671
=======================================================================
</TABLE>
5. Basic earnings per share ("EPS") shown in the accompanying consolidated
condensed statements of income was computed by dividing net income for each
of the periods presented by the weighted average number of shares of common
stock outstanding during each such period. Diluted EPS was computed by
dividing net income by the weighted average number of shares of common
stock and dilutive securities outstanding (consisting solely of
nonqualified stock options). The following table reconciles the
denominator used to compute basic EPS to the denominator used to compute
diluted EPS (in thousands):
<TABLE>
<CAPTION>
For the Three Months Ended
December 31
----------------------------
1998 1997
- -----------------------------------------------------------------------
<S> <C> <C>
Weighted average shares
outstanding (denominator used
to compute basic EPS) 25,624 25,717
Effect of employee and outside
director stock options 615 326
- -----------------------------------------------------------------------
Denominator used to compute
diluted EPS 26,239 26,043
=======================================================================
</TABLE>
6. Effective October 1, 1998, the Company adopted Statement of Financial
Accounting Standards Board ("SFAS") No. 130 - Reporting Comprehensive
Income. SFAS No. 130 establishes new rules for the reporting and display
of comprehensive income and its components. SFAS No. 130 does not have any
effect, however, on the Company's net income or stockholders' equity, or
how these items are computed. SFAS No. 130 requires that the unrealized
gains and losses from the Company's available-for-sale securities and
foreign currency translation adjustments (which, prior to the adoption of
SFAS No. 130, were reported separately in stockholders' equity) be included
in other comprehensive income.
For the three months ended December 31, 1998 and 1997, total comprehensive
income (net of taxes) was $13,928,500 and $12,744,200, respectively.
Page 7
<PAGE>
JACOBS ENGINEERING GROUP INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED CONDENSED FINANCIAL STATEMENTS
December 31, 1998
7. During the three months ended December 31, 1998 and 1997, the Company made
cash payments of approximately $240,000 and $564,000, respectively, for
interest and $5,058,000 and $1,049,000, respectively, for income taxes.
8. On January 14, 1999, the Company completed its Agreement and Plan of Merger
with the Sverdrup Corporation ("Sverdrup"). Sverdrup provides engineering,
architecture, construction and scientific services for the development,
design, construction and operation of capital facilities, infrastructure
projects and advanced technical systems for public and private sector
clients in the United States and internationally. Sverdrup employs more
than 5,600 people in 35 offices.
Under the terms of the merger agreement, at closing, a wholly-owned
subsidiary of the Company ("Merger Subsidiary") was merged with and into
Sverdrup. Thereupon, each outstanding share of common stock of Sverdrup
was converted into the right to receive a proportional share of the total
amount of initial merger consideration paid at closing ($198.0 million),
plus a proportional amount of any additional merger consideration that may
be paid in the future ("Deferred Merger Consideration"). Amounts payable
as Deferred Merger Consideration, if any, will be payable shortly after
each of the first three anniversaries of the date of the merger agreement,
and is contingent upon the Company's stock price reaching certain price
thresholds as defined in the merger agreement. The total amount payable as
Deferred Merger Consideration is limited to a maximum of $31.0 million.
After the merger and conversion, the Merger Subsidiary ceased to exist, and
Sverdrup survives as a new, wholly-owned subsidiary of the Company. The
terms of the merger were arrived at by arms-length negotiations between the
parties.
Of the total initial merger consideration paid at closing, $10.0 million
was paid into an escrow account, the purpose of which will be to settle
certain claims or disputes relating to certain contracts and litigation
matters identified in the merger agreement.
The initial merger consideration was financed in part by a new, $230.0
million revolving credit facility obtained by the Company from a group of
banks led by Bank of America NT&SA. Amounts borrowed under this facility
initially were used to fund that portion of the initial merger
consideration not financed using existing internal funds, and the repayment
of certain Sverdrup indebtedness existing at closing.
The merger will be accounted for as a purchase.
Page 8
<PAGE>
JACOBS ENGINEERING GROUP INC. AND SUBSIDIARIES
December 31, 1998
Item 2. Management's Discussion and Analysis of Financial Condition and
Results of Operations.
General
- -------
The following discussion should be read in conjunction with Management's
Discussion and Analysis of Financial Condition and Results of Operation
(incorporated by reference from pages A-3 through A-11 of Exhibit 13 of the
Company's 1998 Annual Report on Form 10-K).
Results of Operations
- ---------------------
Revenues for the three months ended December 31, 1998 (the "first quarter of
fiscal 1999") were $555.2 million. This was $48.8 million, or 9.6%, more than
the amount for the three months ended December 31, 1997 (the "first quarter of
fiscal 1998"). Revenues from both engineering services and field services were
higher during the first quarter of fiscal 1999 as compared to the first quarter
of fiscal 1998.
As a percent of revenues, direct costs of contracts were 87.7% for the first
quarter of fiscal 1999, as compared to 87.1% for the first quarter of fiscal
1998. The percentage relationship between direct costs of contracts and
revenues will fluctuate between reporting periods depending on a variety of
factors including the mix of business during the reporting periods being
compared, as well as the level of margins earned from the various services
provided by the Company. The movement in this percentage relationship during
the first quarter of fiscal 1999 as compared to the first quarter of fiscal 1998
was due to a proportionately higher level of the Company's overall business
volume coming from construction and maintenance services relative to engineering
services.
Selling, general and administrative ("SG & A") expenses for the first quarter of
fiscal 1999 totaled $45.2 million. This was $0.2 million less than the amount
of SG & A expenses for the first quarter of fiscal 1998. The decrease in SG & A
expenses occurred in spite of the increase in the overall business activity
discussed above. The decrease in SG & A expenses reflects the Company's
continued emphasis to maintain its low-cost method of operations throughout the
organization, and in particular to the results of its cost reduction efforts
relating to the Serete Group and HGC-India (two businesses the Company acquired
in fiscal 1997).
The Company's operating profit (defined as revenues, less direct costs of
contracts and SG & A expenses) was $23.2 million for the first quarter of fiscal
1999. This was $2.9 million more than the amount for the first quarter of
fiscal 1998. The increase in operating profit was due primarily to the higher
level of overall business activity, combined with the SG & A expense control
discussed above.
The Company's effective tax rate was 37.0% for the first quarter of fiscal 1999,
as compared to 39.0% for the first quarter of fiscal 1998. The reduction in the
Company's effective tax rate is attributable primarily to a lower tax rate on
the Company's non-U.S. operations.
Page 9
<PAGE>
Backlog Information
- -------------------
The following table summarizes the Company's backlog at December 31, 1998 and
1997 (in millions):
<TABLE>
<CAPTION>
1998 1997
-------- --------
<S> <C> <C>
Engineering services backlog $1,022.0 $ 934.2
Total backlog 3,335.0 3,045.2
</TABLE>
Liquidity and Capital Resources
- -------------------------------
The Company's cash and cash equivalents increased $12.8 million during the three
months ended December 31, 1998. This compares to a net increase of $0.1 million
during the three months ended December 31, 1997. The Company's operating
activities provided a total of $15.1 million of cash and cash equivalents during
the first quarter of fiscal 1999. The current year increase in cash and cash
equivalents was due to cash provided by operations ($15.1 million) and investing
activities ($0.7 million), offset in part by cash used in financing activities
($1.9 million) and the effect of exchange rate changes ($1.1 million).
The Company's operating activities contributed $15.1 million of cash and cash
equivalents during the first quarter of fiscal 1999. This compares to net
contributions of cash of $15.8 million during the first quarter of fiscal 1998.
The $0.7 million decrease in cash provided by operations in 1999 as compared to
1998 occurred in spite of a $2.3 million increase in net income, and was due
primarily to the timing of cash receipts and payments relating primarily to
receivables, and trade payables, accrued liabilities, customer advances and
income taxes payable, respectively.
The Company's investing activities contributed $0.7 million of cash and cash
equivalents during the three months ended December 31, 1998. This compares to a
net use of cash of $12.4 million during the comparable period last year. This
turnaround in cash flows from investing activities was due to transactions
involving the Company's marketable securities and investments. During the three
months ended December 31, 1997, the Company was a net purchaser of marketable
securities and investments spending a total of $4.2 million of cash. In
contrast, during the three months ended December 31, 1998, the Company
liquidated its domestic portfolio of marketable securities generating
approximately $16.4 million of cash. The Company sold these securities in
anticipation of the Company's closing of the acquisition of the Sverdrup
Corporation ("Sverdrup" - see Note 8 to the Consolidated Condensed Financial
Statements above), and the net proceeds from the sales were used towards the
acquisition of Sverdrup. Offsetting in part the increase in cash from the sales
of marketable securities was a $3.7 million increase in additions to property
and equipment (net of disposals), and a $3.7 million increase in other,
noncurrent assets.
The Company's financing activities used $1.9 million in cash and cash
equivalents during the three months ended December 31, 1998. This compares to a
net use of cash of $3.6 million during the comparable period last year. The
decrease in the amount of cash used in financing activities during the first
quarter of fiscal 1999 as compared to the first quarter of fiscal 1998 was due
primarily to a reduction in treasury stock activity. The Company spent $4.3
million last year in treasury stock purchases; no treasury stock was purchased
during
Page 10
<PAGE>
the first quarter of fiscal 1999. Offsetting this variance in part was a $1.4
million increase in cash used to pay down the Company's long-term debt in 1999
as compared to last year.
The Company believes it has adequate capital resources to fund its operations
for the remainder of 1999 and beyond. At December 31, 1998, the Company's
short-term committed credit facilities totaled $42.0 million through banks in
the U.S., the U.K., France, India and Chile, against which $0.3 million was
outstanding in the form of direct borrowings.
In January 1999, in connection with the purchase of Sverdrup, the Company
terminated its existing long-term $45.0 million revolving credit agreement and
entered into a new, $230.0 million revolving credit agreement. At closing, the
Company borrowed approximately $165.0 million under the new facility which it
used, along with approximately $56.1 million of internal funds, to pay (i) the
initial purchase price of $198.0 million, (ii) certain fees incurred in
connection with the transaction ($2.1 million), and (iii) certain existing
indebtedness of Sverdrup ($21.0 million). At that time, the Company also
modified one of its existing short-term credit facilities under which it
refinanced amounts outstanding under the old $45.0 million revolving credit
agreement.
Year 2000 Readiness - Update
- ----------------------------
As of December 31, 1998, the Company was continuing its Year 2000 compliance
program (readers should refer to pages A-7 through A-10 of Exhibit 13 to the
Company's 1998 Annual Report on Form 10-K for a more complete discussion of the
Company's Year 2000 Readiness program). As of December 31, 1998, the Company
was actively engaged in one or more compliance phases with respect to each of
the critical business areas previously identified. In addition, the Company had
completed its communications effort with substantially all its vendors and
suppliers in the U.S., U.K., Ireland and India, and was in the process of
communicating its Year 2000 requirements to its suppliers in France, Spain and
Italy. Additionally, the Company, through its network of local offices located
throughout the world, was continuing its communications program with its clients
regarding the Company's Year 2000 readiness.
Forward-Looking Statements
- --------------------------
Statements included in this Quarterly Report on Form 10-Q that are not based on
historical facts are "forward-looking statements", as that term is discussed in
the Private Securities Litigation Reform Act of 1995. These statements are
based on management's current estimates, expectations and projections about the
industries in which the Company operates and the services it provides. By their
nature, such forward-looking statements involve risks and uncertainties. The
Company cautions the reader that a variety of factors could cause business
conditions and results to differ materially from what is contained in its
forward-looking statements. These factors include the following: increase in
competition by foreign and domestic competitors; availability of qualified
engineers and other professional staff needed to execute contracts; the timing
of new awards and of funding for such awards; the ability of the Company to meet
performance or schedule guarantees; cost overruns on fixed, maximum or unit
priced contracts; the outcome of pending and future litigation and governmental
proceedings; the cyclical nature of the individual markets in which the
Company's customers operate; and the ability to integrate successfully the
operations of Sverdrup Corporation. The preceding list is not all-inclusive,
and the Company undertakes
Page 11
<PAGE>
no obligation to update publicly any forward-looking statements, whether as a
result of new information, future events or otherwise.
Readers of this Form 10-Q should also read the Company's most recent Annual
Report on Form 10-K for a further description of the Company's business, legal
proceedings and other information that describes factors that could cause actual
results to differ from such forward-looking statements.
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
The Company's 1999 Annual Meeting of Shareholders was held at the Company's
headquarters on February 9, 1999, as previously announced in its Notice of
Annual Meeting of Shareholders and Proxy Statement dated January 4, 1999, copies
of which have been filed with the Commission pursuant to Regulation 14A.
There were three matters voted upon by the stockholders at the Annual Meeting.
Those matters were:
1. To elect a slate of directors as nominated in the proxy statement
(Drs. Joseph J. Jacobs and Dale R. Laurance, and Ms. Linda Fayne
Levinson);
2. To approve certain amendments to the Company's 1989 Employee Stock
Purchase Plan, including a 500,000 share increase and an extension of
the plan to March 31, 2009; and
3. To approve the appointment of Ernst & Young LLP as independent
auditors for the year ending September 30, 1999.
The results of the shareholder voting were as follows (all shares voted were
voted by proxy):
<TABLE>
<CAPTION>
Votes Against Broker
Votes For or Withheld Abstentions Non-votes
-------------------------- ---------------------- ----------- ---------
<S> <C> <C> <C> <C>
1. Election of Directors:
Joseph J. Jacobs 22,351,890 45,855 -0- -0-
Dale R. Laurance 22,356,877 40,868 -0- -0-
Linda Fayne Levinson 22,338,155 59,590 -0- -0-
2. Approval of amendments
to the 1989 Employee
Stock Purchase Plan 22,201,563 121,960 74,222
3. Ratification of the
Appointment of
Ernst & Young LLP
as independent
auditors 22,356,463 18,748 22,534 -0-
</TABLE>
Page 12
<PAGE>
The Directors who did not stand for election at the Annual Meeting and whose
terms of office continued after the Annual Meeting were: Joseph F. Alibrandi,
Peter H. Dailey, Robert B. Gwyn, Linda K. Jacobs, William R. Kerler, James
Clayburn LaForce, David M. Petrone, James L. Rainey, Jr. and Noel G. Watson.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits:
27. Financial Data Schedule.
(b) Reports on Form 8-K:
On December 14, 1998, the Company filed a Current Report on Form 8-K
reporting that on December 9, 1998 the Company had signed an
"agreement in principle" regarding a possible merger with Sverdrup
Corporation.
A press release (dated December 9, 1998) providing more of the details
to the agreement in principle was filed as Exhibit 99.1 to the Form 8-
K.
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.
JACOBS ENGINEERING GROUP INC.
s/n John W. Prosser, Jr.
___________________________
John W. Prosser, Jr.
Senior Vice President, Finance
and Administration and Treasurer
Date: February 10, 1999
Page 13
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 5
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1999
<PERIOD-END> DEC-31-1998
<CASH> 114,155
<SECURITIES> 37
<RECEIVABLES> 399,698
<ALLOWANCES> 0
<INVENTORY> 0
<CURRENT-ASSETS> 568,527
<PP&E> 211,328
<DEPRECIATION> 105,055
<TOTAL-ASSETS> 814,790
<CURRENT-LIABILITIES> 365,516
<BONDS> 0
0
0
<COMMON> 25,865
<OTHER-SE> 359,344
<TOTAL-LIABILITY-AND-EQUITY> 814,790
<SALES> 0
<TOTAL-REVENUES> 555,172
<CGS> 0
<TOTAL-COSTS> 486,852
<OTHER-EXPENSES> 0
<LOSS-PROVISION> 0
<INTEREST-EXPENSE> (982)
<INCOME-PRETAX> 24,054
<INCOME-TAX> 8,899
<INCOME-CONTINUING> 15,155
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 15,155
<EPS-PRIMARY> 0.59
<EPS-DILUTED> 0.58
</TABLE>
