Slide 1: Q3 Earnings Call
Q3 Earnings 24 Call August 1, 2024 Dan Batrack, Chairman & CEO Steve Burdick, Executive VP & CFO Leslie Shoemaker, Ph.D., Executive VP Joseph Fong, High Performance Buildings Lead
Slide 2: Forward-Looking Statements & Non-GAAP Financial Measures
Forward-Looking Statements & Non-GAAP Financial Measures All statements in this communication other than statements of historical fact are “forward-looking statements” for purposes of federal and state securities laws, including any statements of the plans, strategies and objectives for future opera
Slide 3: Q3-24 Record Results
Q3-24 Record Results Net Revenue Operating Income EPS $1.11B $129M $1.59 $0.99B $98M $1.12 +12% +32% +42% Q3-23 Q3-24 Q3-23 Q3-24 Q3-23 Q3-24 3
Slide 4: Q3-24 Performance by Segment
Q3-24 Performance by Segment Segment Net Revenue ($M) OI Margin (%) Comments $488 14.6% $390 14.0% • USAID / Ukraine Up GSG GSG • Advanced Water Treatment Up +25% +60 bps • Environmental Up Q3-23 Q3-24 Q3-23 Q1-22 Q3-24 $621 13.9% $597 11.6% • Sustainable Infrastructure Up CIG CIG +230 • Renewable E
Slide 5: Q3-24 Net Revenue by Customer
Q3-24 Net Revenue by Customer % of Customer Y/Y* Comments Net Rev. • USAID / Ukraine up U.S. U.S. Federal State and Local 30% +34% • Civilian and Defense Environmental up • Advanced Water Treatment up U.S. State & Local 11% +8% • Environmental up • Renewable Energy up U.S. Commercial International 1
Slide 6: Q3-24 Backlog and Recent Key Contract Wins
Recent Key Contract Wins Q3-24 Backlog • $439 million for expanding energy resiliency through innovative solutions for diversified generation, delivery and storage of energy in Ukraine • $73 million to increase energy resiliency and support sustainable $5.23B infrastructure throughout West Africa Q3
Slide 7: FY24 YTD Financial Overview
FY24 YTD Financial Overview Net Revenue ($ in millions) EBITDA ($ in millions) $3,177 $414 +41% Y/Y $2,694 $294 +18% Y/Y +210 bps Y/Y Q3-23 YTD Q3-24 YTD Q3-23 YTD Q3-24 YTD Operating Income ($ in millions) Diluted EPS $357 $4.40 +53% Y/Y +43% Y/Y $4.10 Excl. FY23 $251 FX Hedge Gain +190 bps Y/Y of
Slide 8: Q3-24 Cash Flow Overview
Q3-24 Cash Flow Overview Cash Flow from Ops TTM ($ in millions) Days Sales Outstanding Net Debt Leverage $376 58 1.73x $306 54 4-day Target: +23% Y/Y 1.15x improvement 1.0x-2.0x Q3-23 Q3-24 Q3-23 Q3-24 Q3-23 Q3-24 Cash Flow from Operations has exceeded Net Income every year for the last two decades
Slide 9: Capital Allocation
Capital Allocation • $800M existing liquidity available Debt Facilities • Balanced debt: fixed (2/3) & variable (1/3) • Invest in organic & acquisitive strategic priorities Cash Flow • Strong strategically aligned pipeline $376M Acquisitions • Technical innovation • Water & Environment focus (TTM) •
Slide 10: Increased Funding for Global Priority Water Programs
Increased Funding for Global Priority Water Programs U.K. Water Utilities U.S. Municipal Water • $110B in AMP 8 water spending • National Clean Water Needs - $630B; up 73% • Triple investment in new infrastructure to $45B • $37B to address PFAS drinking water regulations • Target sewer system overfl
Slide 11: Water is a Differentiator for High Performance Buildings
Water is a Differentiator for High Performance Buildings Water for High-Tech & Manufacturing Fabrication & Mission Critical Manufacturing Facilities Data Centers CHIPS Act & AI-Computing & Supply Chain Resiliency Race to Liquid Cooling $200B spend over the next 10 years $500B spend by 2027 Sources:
Slide 12: Increasing FY24 Guidance
Increasing FY24 Guidance Net Revenue EPS Fiscal 2024 Growth* Net Revenue EPS Q4-24 $1.09B - $1.14B $1.82 - $1.87 +15% +23% +15% FY-24 $4.27B - $4.32B $6.23 - $6.28 Assumptions FY-24 FY-23 FY-24 FY-23 FY-24 • Pre-stock split *Midpoint of the range on GAAP basis • Includes intangible amortization of $
Slide 13: Q3-24 Summary
Q3-24 Summary • Strong demand for differentiated Leading with Science® water and environmental services • All-time high revenue and backlog • Backlog and client funding increases are providing momentum for FY24 and beyond • Raising FY24 guidance for Net Revenue & EPS 13
Slide 14: Questions & Answers
[Te] TETRA TECH Questions & Answers