Financial Data and Key Metrics Changes - The company achieved record results for revenue, net revenue, operating income, and earnings per share in the second quarter, with net revenue increasing to $1.1 billion, up $51 million year-over-year, and operating income rising to $130 million, an 11% increase from the prior year [9][10] - Earnings per share for the quarter was $0.33, reflecting an 18% increase from the previous year [10] Business Line Data and Key Metrics Changes - The Government Services Group (GSG) segment saw a 12% year-over-year revenue increase to $521 million, with a margin of 13.8% [10][11] - The Commercial International Group (CIG) segment's revenue was $597 million, up approximately 2%, with a margin of 13.2% [11] - U.S. Federal client work (excluding USAID) increased by 16%, representing about 20% of total revenues, driven by disaster response activities and new programs for the Army Corps of Engineers [11][12] Market Data and Key Metrics Changes - International work accounted for about 38% of revenues, with slight growth on a constant currency basis, although Australian infrastructure work saw a reduction of over 10% due to a recent election [12][13] - The company reported a backlog of $4.31 billion, which includes $220 million in ongoing work with USAID, primarily in Ukraine [13][14] Company Strategy and Development Direction - The company is focusing on high-end data centers and water and environmental projects, which are expected to carry higher margins [16][31] - The addition of the Sage Group is expected to enhance capabilities in digital systems and automation, positioning the company for growth in these areas [34][35] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the funding streams from the U.S. Federal Government, particularly in defense-related services, and noted that the Department of Defense is expected to spend what they contract for [72][74] - The company anticipates continued strong demand for its services in water supply and environmental projects, driven by ongoing challenges such as drought and aging infrastructure [86] Other Important Information - The company announced a 12% increase in its quarterly dividend and reinstated its stock buyback program, with $150 million in stock repurchased in the second quarter [22][23] - A new credit facility of $1.5 billion was secured, providing more liquidity and favorable terms for future investments [20][39] Q&A Session All Questions and Answers Question: Concerns about federal expenditure reductions affecting state and local business - Management noted that they have not seen any near-term pressure on state and local projects, which are often funded through multi-year bonds [42][44] Question: Impact of proposed EPA deregulation on the company - Management indicated that most of their environmental work is driven by state and local regulations, and they do not foresee a direct impact from proposed federal regulations [49][52] Question: Core margin progression post-USAID cancellations - Management expects margins to grow slightly faster than the previously targeted 50 basis points annually, with a new higher baseline established [59][60] Question: Visibility and confidence from government partners for future projects - Management reported positive feedback from federal clients regarding funding commitments, particularly in defense and infrastructure projects [72][74] Question: Capital allocation preferences between share buybacks and M&A - Management stated that they have the ability to pursue both share buybacks and acquisitions simultaneously, with a focus on maintaining double-digit dividend increases [88][89] Question: Utilization rates of staff previously working with USAID - Management acknowledged a decrease in utilization rates for USAID staff but noted that overall staffing levels remained high due to disaster response projects [96]

Tetra Tech (TTEK) Q2 2025 Earnings Call May 08, 2025 11:00 AM ET Speaker0 Good morning and thank you for joining the Tetra Tech Earnings Call. As a reminder, Tetra Tech is also simulcasting this presentation with slides in the Investors section of its website at tetratech.com. This call is being recorded at the request of Tetra Tech, and this broadcast is the copyrighted property of Tetra Tech. Any rebroadcast of this information in whole or part without the prior written permission of Tetra Tech is prohibi ...

May 8, 2025 Dan Batrack, Chairman & CEO Steve Burdick, Executive VP & CFO Leslie Shoemaker, Executive VP Joseph Fong, High Performance Buildings Lead Forward-Looking Statements & Non-GAAP Financial Measures Earnings Call Q2 25 To supplement the financial results presented in accordance with generally accepted accounting principles in the United States ("GAAP"), we present certain non-GAAP financial measures within the meaning of Regulation G under the Securities Exchange Act of 1934, as amended. We provide ...

Group 1: Earnings Performance - Tetra Tech reported quarterly earnings of $0.33 per share, exceeding the Zacks Consensus Estimate of $0.31 per share, and up from $0.28 per share a year ago, representing an earnings surprise of 6.45% [1] - The company posted revenues of $1.1 billion for the quarter ended March 2025, surpassing the Zacks Consensus Estimate by 4.82%, compared to year-ago revenues of $1.05 billion [2] Group 2: Stock Performance and Outlook - Tetra shares have declined approximately 23.3% since the beginning of the year, while the S&P 500 has decreased by 4.7% [3] - The current consensus EPS estimate for the upcoming quarter is $0.34 on revenues of $1.06 billion, and for the current fiscal year, it is $1.37 on revenues of $4.37 billion [7] Group 3: Industry Context - The Pollution Control industry, to which Tetra belongs, is currently ranked in the bottom 18% of over 250 Zacks industries, indicating potential challenges for stock performance [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can impact investor sentiment [5]

Exhibit 10.1 Execution Version Published Deal CUSIP Number: 88163BAP8 Published Revolving Credit Facility CUSIP Number: 88163BAQ6 Published 3-Year Term Loan Facility CUSIP Number: 88163BAR4 Published 5-Year Term Loan Facility CUSIP Number: 88163BAS2 FOURTH AMENDED AND RESTATED CREDIT AGREEMENT Dated as of May 5, 2025 among TETRA TECH, INC., TETRA TECH CANADA HOLDING CORPORATION, TETRA TECH UK HOLDINGS LIMITED, TETRA TECH AUSTRALIA GROUP HOLDINGS PTY LTD and CERTAIN OTHER SUBSIDIARIES, as Borrowers, THE LEND ...

Tetra Tech, Inc. (TTEK) has secured an extended One Acquisition Solution for Integrated Services (OASIS+) contract for broad service areas from the Government Services Administration (GSA). Financial terms of the deal were kept under wraps.Per the five-year, multiple-award Indefinite Delivery Indefinite Quantity contract, TTEK has been chosen for various technical service areas to support federal agencies. These include management, research, engineering, environmental, facilities, intelligence and logistics ...

Core Viewpoint - Tetra Tech, Inc. has secured multiple significant contracts, indicating a strong growth trajectory despite facing challenges such as rising operating costs and high debt levels [1][3][7]. Group 1: Recent Contracts and Projects - Tetra Tech has been awarded a contract from the U.S. Army Corps of Engineers (USACE) for architect-engineer services, capped at $46 million [1]. - The three-year deal involves providing engineering and design solutions for various projects, including road improvements, building upgrades, and safety checks for dams and levees [2]. - In March 2025, Tetra Tech secured a contract from United Utilities for flood management in the UK, and three contracts worth $416 million from USACE for technical services in the Indo-Pacific region [3]. - In October 2024, the company received a $249 million contract from USACE for environmental evaluation and design services across the U.S. [4]. - Additionally, Tetra Tech secured a $39.3 million contract from USAID to support the Engendering Industries program [4]. Group 2: Financial Performance and Market Position - Tetra Tech currently holds a Zacks Rank of 4 (Sell), with shares declining by 22.3% over the past year, compared to an 11.5% decline in the industry [5]. - The company is facing increasing operating costs and high debt levels, which may impact its profit margins in the future [7].

Tetra Tech, Inc. (TTEK) recently completed the acquisition of management consulting company Carron + Walsh. The financial terms of the transaction have been kept under wraps. Headquartered in Dublin, Ireland, Carron + Walsh is engaged in providing project and cost management services for residential, commercial, life sciences and infrastructure programs. The company has a strong client base, including housing authorities, public sector bodies and financial lenders, particularly in European markets. Tetra Te ...

Group 1 - Tetra Tech, Inc. (TTEK) and its joint venture partner have secured three contracts worth $416 million from the U.S. Army Corps of Engineers (USACE) for technical services in the Indo-Pacific region [1] - The five-year contracts involve civil works, military base infrastructure, and planning projects, including advanced computer modeling and engineering design services [2] - TTEK will conduct detailed facility assessments and focus on optimizing water resources infrastructure to enhance sustainability [3] Group 2 - Recently, Tetra Tech has received several contracts that are expected to drive growth, including a $249 million contract from the USACE Omaha District for environmental evaluation and design services [4] - In addition, TTEK secured a $39.3 million contract from USAID for the Engendering Industries program and a $73 million deal to enhance electricity availability in West Africa [5] - The company also obtained a $375 million contract from NASA for environmental restoration and compliance services at NASA facilities [5] Group 3 - Tetra Tech currently has a Zacks Rank of 4 (Sell) and its shares have declined by 18% over the past year, compared to an 8.4% decline in the industry [6] - The company is facing rising operating costs and high debt levels, which may impact its margins and profitability [7]

Group 1 - Tetra Tech (NASDAQ: TTEK) has experienced a significant decline in stock price due to concerns regarding USAID spending, which constitutes approximately 10% of the company's revenues [1] - The margins associated with USAID contracts are relatively low because of their cost-plus nature, indicating that the impact on overall profitability may be limited [1] Group 2 - The analyst has a background of over 15 years in investment, focusing on medium-term investing strategies that aim to unlock value or capitalize on downside catalysts [1] - The analyst has primarily analyzed sectors such as industrial, consumer, and technology, suggesting a higher conviction in investments within these areas [1]