Tetra Tech(TTEK) - 2026 Q1 - Quarterly Results

Financial Performance - Revenue for Q1 FY26 totaled $1.21 billion, with net revenue of $1.04 billion, representing an 8% increase excluding USAID/DOS and Q1-25 Hurricanes[3][6] - Operating income was $141 million, and adjusted EBITDA was $147 million, with an adjusted EBITDA margin improvement of 80 basis points year-over-year[3][7] - EPS increased by 17% year-over-year to $0.40, while adjusted EPS was $0.35[3][6] - Revenue for the three months ended December 28, 2025, was $1,210.7 million, a decrease of 15% compared to $1,420.6 million for the same period in 2024[22] - Gross profit for the same period was $220.4 million, slightly down from $221.5 million year-over-year[22] - Net income attributable to Tetra Tech for the three months ended December 28, 2025, was $105.0 million, compared to $0.7 million in the prior year, representing a significant increase[22] - Earnings per share attributable to Tetra Tech was $0.40 for the three months ended December 28, 2025, compared to a loss in the same period last year[22] - Adjusted EBITDA for the three months ended December 28, 2025, was $147.3 million, compared to $153.2 million in the prior year[26] Cash Flow and Operations - Cash from operations was $72 million in Q1 and $517 million over the trailing 12 months[3] - Net cash provided by operating activities was $72.3 million, a substantial increase from $13.1 million in the prior year[24] - Net cash provided by investing activities was $37.5 million, compared to a cash outflow of $3.4 million in the same period last year[24] - Cash and cash equivalents at the end of the period were $269.4 million, up from $248.1 million at the end of the same period last year[24] - Tetra Tech's DSO improved to 51 days, reflecting better cash flow management[7] Strategic Initiatives - Tetra Tech is raising its FY26 net revenue guidance to a range of $4.15 billion to $4.30 billion and adjusted EPS guidance to a range of $1.46 to $1.56[11] - The company announced two strategic acquisitions to enhance its front-end consulting services for defense clients[8] - Significant contracts include a $151 billion ten-year contract for the U.S. Missile Defense Agency and a $500 million contract for environmental services for USACE Baltimore District[7] - The company plans to continue focusing on market expansion and new product development to drive future growth[22] Shareholder Returns - The company repurchased $50 million of common stock in Q1, with $548 million remaining under its share repurchase programs[9] - The company reported a gain on the sale of a divested business amounting to $7.7 million during the quarter[24] Backlog and Future Potential - Backlog at the end of Q1 was $3.95 billion, indicating strong future revenue potential[3][6]