Impact. Transform. Improve
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Impact. Transform. Improve. 2014 Annual Report 1 Impact. Transform. Improve. Growth and financial performance Fiscal year 2014 was a truly During fiscal year 2014, AECOM delivered value and organic growth during fiscal year transformational year for AECOM — solid results, meeting the evolving needs 2015. The firm generated US$298 million in and the future of the engineering and of its clients, supporting the professional free cash flow during fiscal year 2014 — a construction industry. development of its employees and non-GAAP measure equal to cash flow During the year, AECOM announced strengthening its standing as a valuable from operations of $361 million less capital the combination with URS, which investment. The company continued to expenditures of $63 million. AECOM’s closed in the first few weeks of expand its services — while advancing near-term priority is to deploy cash to pay the current fiscal year, and began its organizational structure and capital- down debt. As communicated during its laying the groundwork for the firm’s allocation strategy — to remain a trusted earnings calls, AECOM expects free cash integration process. With URS on partner to clients, a great place to work, flow of the combined organization to be board, the new AECOM — which has and a results-focused business for quite strong, with debt expected to be paid nearly 100,000 employees serving shareholders. down to approximately two times debt to clients in more than 150 countries — EBITDA by the end of 2017, compared with is nearly twice as large by measures Despite uneven macroeconomic trends, approximately 4.5 times at the close of the such as revenue and employees the firm advanced toward its long-term URS combination. and has unsurpassed design, build, financial and operational goals, while finance, and operate capabilities to strengthening its competitive position. AECOM also expects to deliver on its serve clients on a global basis. AECOM’s diversified services, paired synergy targets related to the URS In addition, during fiscal year 2014, with its global execution capabilities, are transaction, having increased its initial AECOM announced the acquisition of critical factors in the company’s ongoing guidance of US$250 million in synergies stadium construction management success in construction services, its to US$275 million. leader Hunt Construction Group, international design business and its complementing AECOM’s strength in management support services segment. the design of sports arenas and venues, and hospitality-industry facilities, This success, combined with the Spain-based international development company’s demonstrated commitment firm ACE International Consultants to meeting clients’ evolving needs, S.L. Aligned by a common purpose — positions AECOM well to capitalize on to positively impact lives, transform future opportunities. For fiscal year 2014, communities and make the world a the firm recorded US$13.8 billion in new better place — AECOM employees wins. This contributed to a backlog of dedicate themselves to delivering US$25.1 billion, representing 52 percent solutions that draw upon its combined total growth and 33 percent organic global expertise and local knowledge growth. as we bring opportunity, progress and vitality to the communities in which we AECOM’s capital-allocation priorities work and live. continue to be of high importance as the company focuses on stockholder 2 Designing for success Ethics and integrity Now that the combined firm is AECOM remains dedicated to sustaining operating as one company under the a high-performance, engaging work AECOM brand, we have implemented environment that reflects the shared an operating structure that reflects cultures of a long legacy of industry- the strength of both companies and leading firms. The company’score positions us to successfully meet the values — people, clients, excellence, design, build, finance and operate safety, innovation and integrity — are needs of clients globally. paramount to AECOM’s continued success. AECOM’s three reported segments are Design and Consulting Services; Through ongoing, transparent Construction Services; and partnerships with all stakeholders, Management Services. In addition, AECOM builds trust, which is a AECOM Capital continues to support fundamental ingredient for long-term its integrated-services platform success. While business results are and differentiate its competitive a critical measure of this success, offering through direct investments how employees achieve those results in real estate and public-private is every bit as important. For this partnerships. Through the end of reason, the firm’s reputation of fiscal year 2014, AECOM Capital had trustworthiness and integrity has committed $150 million to 13 projects resulted in accolades such as being that have driven approximately $1 named one of the World’s Most Ethical billion in Construction Services Companies by the Ethisphere Institute backlog. for four consecutive years, and being recognized by the New York Stock There are very few companies in the Exchange Governance Services as a world that can execute at the scale finalist in the “Best Governance, Risk, and technical level that AECOM and Compliance Program at Small to is known for delivering, and its Mid-Cap Company” category. capabilities are enhanced with this new structure. 3 Impacting communities Developing a sustainable future AECOM understands that aligning disadvantaged communities through With a vision of contributing to a more- business values, purpose and strategy groups such as Engineers Without sustainable future, AECOM employees with the social, environmental and Borders, Water For People, Just a Drop, incorporate sustainability as part of their economic needs of all stakeholders the International Committee of the Red integrated solutions, enabling clients to creates a competitive advantage Cross and its affiliates around the world, secure business continuity, reduce their for the company. Corporate social the Maasai Wilderness Conservation impact on the environment, and improve responsibility (CSR) encompasses Trust, the Wounded Warrior Project, the lives of the project’s end users. AECOM many areas — from good corporate the Yellow Van Food Rescue, the Sabre defines sustainability as helping clients, citizenship to business imperatives Charitable Trust and the construction society and the firm address complex such as integrity, safety, governance, and property industry’s charity for challenges by managing financial, natural, sustainability and other components. homeless people (CRASH), as well social and human capital, with minimum as natural-disaster-relief efforts risk. Examples of these efforts include: CSR is viewed as the collective and a variety of other philanthropic energy and effort of the company organizations around the world. - The Masdar Siemens Headquarters and its employees to benefit society in Masdar City, Abu Dhabi, is the first and the environment through the AECOM also reaffirmed its commitment Leadership in Energy and Environmental contribution of labor, financial to helping those in need during critical design project in the United Arab support and facilities as well as social times by providing relief efforts for Emirates with a Platinum rating. and community networks. That’s why, those affected by the Oso landslide, - AECOM was selected as a finalist in the in an effort to transform the world earthquakes in China, devastating “River of Life” competition to further around us, the heart of AECOM’s floods in the Western Balkans, and other develop the company’s initial master CSR program focuses on impacting disasters. As an example, during the plan submission to rejuvenate the communities and improving the lives flooding in the Western Balkans, AECOM Klang River and its surrounding area of the people it touches every day. employees already working in the area into an iconic waterway — facilitating responded immediately by participating AECOM and its employees have a rich the continued growth of Kuala Lumpur, in on-site flood-protection activities Malaysia. history of contributing to society and across the region. AECOM employees the environment by supporting pro- also showed their support through - AECOM employees analyzed the bono, philanthropic and charitable fundraising activities across Europe potential long-term implications of activities in the places where they and Asia to help residents resume to climate change and population growth work and live. normalcy. The company matched on the Federal Emergency Management staff donations to the Red Cross Agency’s National Flood Insurance During 2014, employees logged Disaster Appeal. Program in the United States. thousands of volunteer hours helping - The firm’s work on South Africa’s Strumosa Urban Agriculture and Waste Education Centre incorporates an interconnected system optimizing the use of waste and water to create jobs, improve the livelihood of local community members and boost the country’s economy in the long term. - Australia’s Townsville Port Access Road aims to support significant regional economoic development during the next 20 to 25 years. 4 Safety for Life Safety is an essential part of AECOM’s anyone is at risk — taking responsibility injuries and illnesses, reduced by 61 DNA. That’s why its definition of for the safety of their colleagues and percent. safety — one of the firm’s core values ensuring everyone returns home to - The Gold International Business Award — encompasses everything from their families