Jacobs Solutions Seizes Momentum in Strategic Shift to Higher-Value Portfolio
Jacobs Solutions has wrapped up a remarkable fourth quarter and fiscal year 2024, marking significant milestones in its strategic shift toward a simpler, higher-value portfolio. The company's CEO, Bob Pragada, highlighted the critical moment on Slide 4 of the earnings presentation, where Jacobs successfully closed the separation transaction involving its Critical Mission Solutions and Cyber Intelligence businesses, culminating with momentum listing on the NYSE under the ticker AMTM.
As a result of this strategic move, Jacobs received $911 million, which was concurrently used to repay existing debt. Furthermore, the company secured a 7.5% equity ownership in Amentum, with potential for an increase to 8%. The separation also saw Jacob shareholders become 51% owners in shares of Amentum, and their stake could rise up to 55%. This transaction has been well-received by the market, demonstrating confidence in Jacobs' focused direction.
Speaking on the conference call, Bob Pragada emphasized the importance of this transaction for Jacobs. As a more sharply focused company operating in robust end markets with strong secular growth tailwinds, Jacobs is poised to create substantial shareholder value. The simplified structure and global delivery model of the company position it nicely to build on a strong end to FY '24.
The company's financial performance also reflects its growing momentum. Total gross revenue increased 4% in Q4 with adjusted net revenue rising by the same percentage. GAAP EPS from continuing operations was $2.38, which includes a positive $120 impact from the mark-to-market of Jacobs' investment in Amentum and a negative impact of $0.19 related to transaction restructuring and other costs. Excluding these items, fourth-quarter adjusted EPS was $1.37, marking a 28% increase compared to the previous year.
Adjusted EBITDA for Q4 came in at $289 million, representing a 12% growth versus FY '23. Looking at the full year, total gross revenue increased 6% with adjusted net revenue rising by 5%. GAAP EPS from continuing operations was $4.79 and included a positive $0.50 impact related to the amortization of acquired intangibles and the mark-to-market of Jacobs' investment in Amentum. Excluding these items, adjusted EPS from continuing operations was $5.28, marking a 16% increase compared to the previous year.
Adjusted EBITDA for FY '24 was $1.06 billion, representing a 9% increase versus FY '23. Jacobs' trailing 12-month book-to-bill was 1.35x as its consolidated backlog increased 23% year-on-year in Q4. These metrics demonstrate the company's growing momentum and encourage investors.
As Jacobs continues on this strategic path, it remains poised to capitalize on robust end markets with strong secular growth tailwinds. With a simplified structure and global delivery model, Jacobs is well-positioned to build on its strong finish in FY '24 and deliver sustained value and growth for its shareholders.
