Gaurav Kapoor: Sure. Absolutely. Now, if you recall for ACAP, we move that into held-for-sale a few quarters ago and would that basically requires it’s got to be carried at fair market value of cost per the accounting rules. So what you saw through was just an accounting entry coming through in the current quarter which is the credit markets continue to tighten. But our expectation that we had communicated a few quarters ago on the expected cash flow from this business now being part of non-core. That has not changed. Also, I think it’s important to note there is minimal value left of our direct investments in ACAP on our balance sheet. I believe it’s less than $15 million. Nothing has changed in terms of what our strategy was, what we communicated a few quarters ago and we continue on the timing consistent with our expectations to execute on that strategy.
Sabahat Khan: Okay. Great. And then just one last quick one. How are you thinking about given where the share prices today, how are you thinking about buybacks as we look ahead for the rest of the year? Is there a certain amount that you definitely want to do or is it going to be more opportunistic over the next few quarters?
Troy Rudd: Sabahat I’ll, first I’d just point out that with respect to how we allocate capital. Nothing has really changed. And so again, what we’ve described in the past, we’ll stick to this and say, we are going to be a returns-focused in terms of allocating our capital. We will continue to invest in organic growth. It’s a little bit different investing in organic growth as Gaurav pointed out that does go through our margins. So our margins actually contain a pretty significant investment in the future. Secondly, we believe that we should be returning capital to shareholders and we’ve increased the dividend and as I said in the prepared comments we’ve got a Board authorization for a billion dollars of repurchases and we will continue to repurchase our stock.
What we said with respect to timing, is that we will effectively use our cash flow through the year to buyback our stock. So that might be a way to think about just the timing of it. We don’t look at being opportunistic. We look at just doing it consistently over the course of the year.
Sabahat Khan: Great. Thanks very much for the color.
Troy Rudd: Thank you.
Operator: Your next question comes from the line of Andy Kaplowitz from Citigroup. Please go ahead.
Andy Kaplowitz: Good morning, everyone.
Troy Rudd: Good morning.
Gaurav Kapoor: Good morning.
Lara Poloni: Good morning.
Andy Kaplowitz: So, Gaurav you beat the street excluding the lower tax rate by something like $0.05 in your design backlog is up nicely, as you said, but you didn’t increase the guide at either end of the range. I know it’s early in the year, but is there anything that you’re seeing that gives you some pause? And then how do you think about EPS cadence in Q2 and for the rest of the year? Should it just be for a normal seasonality?
Gaurav Kapoor: Yeah, Andy. Thank you for the question, and good morning to you as well. We did have a very strong first quarter, and it’s a valid question, right, because we have met and beat expectations in the last four years. But as you would recall this management team, our mantra is to be prudently conservative, especially in Q1. So we are going to continue to operate with that mantra. Q1 definitely gives us a lot of confidence, in continuing the trend we have accomplished over the last four years and I think from a phasing standpoint, as we said before, the phasing is going to be consistent on earnings with our historical phasing we have delivered upon. But there’s nothing in the horizon that would give us pause as we continue to operate in FY ’24, given the backdrop of how strong our businesses are including again, I can’t emphasize enough I’ll have to be redundant is how the robust pipeline and record level of bidding where we are experiencing in the business.
Andy Kaplowitz: Thanks, Gaurav. And then Troy maybe you give us a little more color into your end markets within the Americas. You mentioned strength in water and transportation, but didn’t really highlight facilities for instance yet. I think AECOM has good data center design exposures. So could you elaborate on what you’re seeing across all the end markets in the Americas?
Troy Rudd: Yeah. Sure. The simple answer is, we are seeing strength across all of our end markets, including our facilities business. And again within our facilities business, we have shifted our focus over the past three years from what we have done in the past to again to more public infrastructure and that includes transportation projects. So, we saw strength across the entire business, but I think there’s another importable — another important trend to call out, which is we’ve actually changed the focus. So that we are now instead of being a design firm that’s exposed to, say, 10% to 15% of a project spend through the expansion of our advisory and program management offering we are now exposed to, say, 30% of the project spend, but more importantly we are exposed to — we think, more than 50% of the profitability of the projects.
And so that’s given us an opportunity. So even where there might be some slowness in the market because we are exposed to much greater client spend we have the opportunity to support businesses that might even — they might even be seen some slowing in the market. Again strength across the business because of healthy markets, but also because of our increased exposure to client projects and spending. And with respect to program management. Over the course of the last year on projects that we bid that are greater than $50 million in size, we’ve bid 11, and we’ve won all 11. So again, I think that just speaks to the strength of our program management offering, but it also gives you the example of the opportunity that we see again across all of our markets and all of our projects, and our end customers.
Andy Kaplowitz: Appreciate the color, guys.
Troy Rudd: Thanks.
Operator: Your next question comes from the line of Sangita Jain from KeyBanc Capital Markets. Please go ahead.
Sangita Jain: Yes. Hi, thanks for taking my question. Troy, you talked about the U.K. elections and a little bit of a pause in spending there. Can you give us color on the U.S. and the EU elections, which are also coming up? And whether you think there’s — you’re seeing a pull-forward of business, there, or people in a wait-and-see mode maybe?
Troy Rudd: Certainly. So with respect to the U.S. we are not seeing a change in as you described in spending patterns or spending habits. There is, first of all, over the last few years, there have been a lot of funding put in place that is long-term and multi-year funding and that’s all supported, again. I think in a — bipartisan way in the United States. So we haven’t seen a change in funding nor a change in the appetite for our U.S. government clients to invest in infrastructure. With respect to the EU again, it’s just start by saying, our exposure to the EU market is quite small. If you recall 90% of our business actually comes from four countries. It’s the U.S., Canada, the U.K., and Australia. So, well, Europe may be choppy in terms of infrastructure funding. We just don’t see it having a large impact on us, but we still see, again, there are some places across the EU where there is certainly money being put in infrastructure, in particular into water programs.
Sangita Jain: Great. Thank you so much. And if I can ask you another one, on your project management portfolio, obviously you’ve been seeing some phenomenal wins there. Can you talk a little bit about the typical pushback that you may be seeing as you take share from incumbents in these projects maybe?
Troy Rudd: Well, it’s an interesting question. We really haven’t seen much pushback as evidenced by our win rate. I have to say, I think that there is a large opportunity. That was a long — it was driven a few years ago from our customers and our customers recognize that with all the funding that was available. And frankly, the complexity and size of these programs that the only way they could advance some was actually having help from someone like us who has the technical ability to understand these complex projects and then has the management ability to deliver them. So our opportunity was born out of a need from our customers. And then we just taken advantage of the opportunity to take our skills across the platform and to grow it by supplementing it with people from across the industry with those skills.
So we’ve built up a really strong impressive core team and I think it’s a combination of our skills in that core team and frankly some of the things we are doing with respect to our digital innovations to make the customer process much more transparent and to improve the communication or think about it as an improved client experience. So all those things have come together and we are just not seeing the pushback in the market as evidenced by our win rate.
Sangita Jain: Great. Thanks so much.
Troy Rudd: Thank you.
Operator: Your next question comes from the line of Steven Fisher from UBS. Please go ahead.
