Financial Data and Key Metrics Changes - The company reported net revenue of $987 million for the first quarter, an increase of 8% from the prior year [5] - Operating income rose to $131 million, up 12% year-over-year [5] - Adjusted earnings per share (EPS) increased by 17% to $0.34, while GAAP EPS was reported at $0.40 [5][6] Business Segment Performance - The Government Services segment generated $382 million in revenue, growing 5% despite a U.S. government shutdown [6] - The Commercial and International Group segment's revenue increased by 10% to $605 million, driven by growth in the UK and Ireland [6][7] - Margins for both segments improved by 40 basis points, with Government Services at 18% and Commercial International at 13% [6][7] Market Data and Key Metrics Changes - Federal work increased by 7%, primarily due to projects with the U.S. Army Corps of Engineers [8] - State and local markets in the U.S. grew by 10%, driven by municipal water treatment initiatives [8] - International revenue accounted for 48% of total revenue, growing at a rate of 13%, with significant contributions from the UK and Ireland [9] Company Strategy and Industry Competition - The company focuses on water supply, treatment, flood control, and environmental stewardship, which are in high demand [3] - Strategic growth areas include technology and automation, with plans for acquisitions to enhance capabilities in defense and environmental services [18][25] - The company aims to leverage its strong balance sheet for future acquisitions, targeting firms that can enhance its market position [70] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in revenue growth despite challenges like the government shutdown, anticipating increased federal orders as budget clarity improves [10][11] - The company expects international growth to continue at a rate of 5%-10%, supported by water programs and defense spending [27] - Guidance for the second quarter is set at $975 million to $1.025 billion in net revenue, with adjusted EPS of $0.30 to $0.33 [29] Other Important Information - The company announced a 12% increase in its quarterly cash dividend, marking the 47th consecutive dividend payment [18] - A stock buyback program was initiated, with $50 million repurchased in the first quarter [19] - The company divested its Norway operation, which was deemed non-core, prior to Christmas [82] Q&A Session Summary Question: Strength in Federal Business - Management highlighted that the federal business grew 7% due to advanced planning and strong relationships with clients, particularly the U.S. Army Corps of Engineers [37][40] Question: International Business Performance - The UK and Ireland have shown strong double-digit growth, while Canada is recovering and Australia is stabilizing after previous declines [41][46][48] Question: Guidance and Market Conditions - Management discussed the potential impact of a government shutdown on guidance, noting that while it could affect the lower end, essential services would likely continue [59][61] Question: Focus on M&A - The company is looking to leverage its strong balance sheet for strategic acquisitions, with a focus on larger, transformative opportunities [67][70] Question: Details on Recent Acquisitions - Recent acquisitions include Halvik and Providence, which are expected to enhance the company's capabilities in defense and consulting [79][81]