Jacobs Solutions Inc. (NYSE:J) Q4 2022 Earnings Call Transcript

And so that’s going to continue to drive our business as we come up with more technology-enabled and client-driven type solutions. The second is around investments in our people. Our people have delivered time and time again over decades. But if you look at the profile of our people, although our business is weighted towards the U.S., our — we have about a 55-45 U.S. versus outside of the U.S. profile of our people, really driven around that global delivery that we’ve counted for so long. And so those investments and continued driving around inclusion and diversity and sourcing talent from all over the world is going to be really, really important. And the last piece I’d say is around resilience. Resilience in our business with regards to our systems and how we run the company but also simplicity of our business.

We’ve diversified the business and we’ve tried to have direct access to our clients. But making that — having simplicity in the forefront is really key as well. So kind of segregated in those 3 main areas.

Operator: Your next question is from the line of Steven Fisher with UBS.

Steven Fisher: So we have about a month left on the current continuing resolution. So I’m curious what you’ve baked into the guidance for continuing resolution across your segments? And then I guess there’s clearly a lot of cross currents in the global economy at the moment. What do you see as any other big risk to your guidance? And maybe what contingency plans do you have in process to address those risks?

Kevin Berryman: Maybe I’ll make some comments first and then have my partners here add any additional commentary to think appropriate. So look, I think we feel pretty good about the continuing resolution, given the makeup of the Senate and the House and how that’s going to be coming together. And we just had a really deep dive review from a government relations team feeling pretty good about how things are going to play out over the course of this quarter. So we don’t believe that there is going to be a continuing resolution that extends well into 2023. We’re hoping that that will become resolved near the end of the calendar year. So I think that we’re already starting to see, regardless of that continuing resolution, some momentum building relative to what Bob alluded to as — and I made some comments on in terms of the cyber and intelligence business starting to get unlocked relative to bids being awarded and whatnot.

So, we think that the combination of those 2 things are embedded into our guidance. And I feel — we feel pretty good about it actually.

Operator: Your next question is from the line of Andy Kaplowitz with Citigroup.

Andy Kaplowitz: Steve and Bob, congratulations.

Bob Pragada: Thanks, Andy.

Andy Kaplowitz: So you mentioned you’re still targeting double-digit constant currency revenue growth for PA Consulting but I think constant currency Q4 was in the high single digits. Does the recent large contract when you mentioned to give you the visibility you need to be confident around constant currency double-digit growth for FY ’23 despite U.K. economic concerns? And does margin normalize higher quite significantly impair as revenue ramps up towards that 20% goal that you’ve given us before? Or should we think about a gradual margin ramp-up from here in PA?