Good day ladies and gentlemen and welcome to the first quarter 2012 AECOM Technology Corporation earnings conference call. At this time, all participants are in a listen-only mode. Later, we will be conducting a question-and-answer session. (Operator Instructions) I would now like to turn the conference over to host for today Mr. Paul Cyril, Senior Vice President of Investor Relations. Please go ahead sir.

Thank you. Please turn to slide number two. As we begin let me remind everyone that today’s discussion contains forward-looking statement based on the environment as we see here today and as such does include risks and uncertainties. As you know our actual results might differ materially from these projected forward-looking statements. Please refer to our press release or slide two of our earnings presentations and to our reports filed with the SEC for more information on the specific risk factors that could cause actual results to differ materially. Important information about our earnings is posted to the investor website investors.aecom.com. We posted our earnings release and updated financial statements on the slide for anyone who still needs access. Note that we are using some non-GAAP financial measures as references in the presentation. The appropriate GAAP financial reconciliations are posted on our website as well. Finally, a replay of today’s call will be posted to the website at around middle eastern time and will remain there for approximately two weeks. Please turn to slide number three. Beginning today’s call and presentation is John M. Dionisio, Chairman and Chief Executive Officer. John, please go ahead.

Thank you, Paul. Good morning everyone and thank you for joining our call. Here with me today are Mike Burke, our President; Steve Kadenacy our CFO; and Jane Chmielinski our COO. After my introduction, I will hand it over to Steve who will review our financial results. Mike will cover our outlook, future book of business and capital allocation strategy and I will discuss our markets. We have several objectives on our call today. First is to provide you with an overview of our quarterly financial performance and the drivers behind the performance. Second, we will reaffirm our 2012 earnings per share guidance range and we will set forth our plan on how we will achieve the $2.45 to $2.65 range this year. And then we are going to update you on our most important operating initiatives driving new growth and momentum inside our business. We will then begin the question-and-answer session. With that I would like to turn the call over to Steve for our review of the quarter. Steve, please go ahead.

Thanks, John. Please turn to slide 4. We reported earnings per share of $0.42 for the first quarter. As we noted on our fourth quarter call, this quarter would be lighter than our historical average in terms of the percentage of annual earnings. The three items impacting the quarter specifically were our European transition costs and certain unrecoverable costs on two MSS projects. One, that now is completed and another that is scheduled to be completed in the second quarter. In addition, you may recall that in the first quarter 2011, our Libya project was still active and a positive contributor. Further, we benefited from the R&D tax credit extension in the US during that quarter. The balance of the difference was driven by non-operating items and 7% underlying growth in the business. Our first quarter gross revenue increased 5% over last year to $2 billion and net service revenue increased just over 1% year-over-year. On an organic basis, gross revenue increased 4% driven by increased construction management activity while organic net service revenue was up 0.4% year-over-year. Our total organic net service revenue grew 1.4% on a constant currency basis excluding the impact of Libya. We continue to see strength internationally in geographies such as Asia, Australia, Canada and Latin America and in our private sector business of commercial construction, environmental management and energy. On the other hand, Western Europe remains a challenge. However we anticipate that our restructuring efforts will reap benefits in the second half of the year and we are seeing increased opportunities in this geography including recent sizable wins that are not yet reflected in the backlog. We also won 2.2 billion in new work during the quarter for a book-to-burn ratio of 1.1 and our backlog increased 2% from the prior year to $15.8 billion. Please turn to slide five. We would also like to highlight the cash flow performance in the quarter. Our cash flow from operations improved by $173 million year-over-year. This represents our best first quarter cash flow in five years and builds upon our record cash flow achieved in the fourth quarter. Our PTS DSOs came down by three days year-over-year. In total, our cash and cash equivalents increased by 20% year-over-year to $507 million and our leverage ratio declined to 1.4 versus 1.7 in the prior year. We continue to focus on cash flow as a key measure of operational performance and we’re on track to achieve our full-year target for free cash flow as a percentage of net income. Please turn to slide six. Our PTS segment accounted for 89% of our first quarter revenue. Gross revenue increased by 15% year-over-year driven by an uptick in commercial construction activity in North America. Net service revenue increased 1% from last year to $1.1 billion. Organic net service revenue rose 0.4% year-over-year and increased 2% on a constant currency basis, excluding Libya. Operating income in the PTS segment decreased 5% over last year to $87 million while operating margins fell by 52 basis points year-over-year. Our margins were negatively impacted by the European transition costs in the current period and by the absence of contributions from Libya which benefitted the first quarter of 2011. Excluding Libya and the aforementioned European costs our PTS margins improved by 20 basis points year-over-year. Our Management Support Services segment accounted for 11% of our first quarter revenue. As we mentioned last quarter, this segment is undergoing a change in project mix. It is moving from contracts with significant pass through costs to projects with more self-performed work and a higher component of net service revenue. As a result, gross revenue for the quarter was down 38% year-over-year, while net service revenue increased 1% year-over-year. MSS segment operating income decreased by $10 million from last year to $12 million and operating margins as a percentage of gross revenue were 61 basis points below last year. Operating income was negatively impacted in the quarter by $6 million in unrecoverable costs on two projects. The factors that led to these losses were unique to each of the contracts and do not have a bearing on the rest of the work we perform for the US government. Excluding these project costs, our MSS margins on gross revenue would have increased a 180 basis points year-over-year. Also the speed of the Iraq drawdown impacted our first quarter results more than anticipated. We now have little further exposure in Iraq. Please turn to slide 7. Our EBITDA margin in the quarter was 8.4%. The margins reflect discreet items we already mentioned and we view this as a temporary dip against the backdrop of otherwise strong margins. Because of that, we are reiterating our commitment to achieve our long-term goal of 12% EBITDA margins by 2015. We intend to accomplish this through continued diversification at the higher margin services such as Program and Construction Management and Mike will speak further to this point when he discusses our M&A strategy later in the presentation. We will also continue to drive savings from our scale. This includes areas such as shared services and high-value add design centers as well as real estate consolidations. Capitalizing on these efficiencies also expands our internal collaboration opportunities and improves our overall financial performance. Now let me turn the call over to Mike.

Thank you, Steve. Please turn to slide 8. Our backlog provide us with good visibility on the remainder of the year and we are reiterating our 2012 earnings per share guidance range of $2.45 to $2.65. We will drive towards this goal by executing on the market initiatives we just discussed in achieving strong organic growth in our fastest expanding markets of Asia, Australia, power, energy and mining as well as construction management. While we expect second quarter earnings per share to be similar to the first quarter we are confident in our visibility for the second half of the year as we see an increasing conversion of backlog to revenue. This confidence level is driven by several factors. First our successful European restructuring has resulted in a dramatic operational improvement, including over $300 million in new wins in January alone, which is a significant acceleration for this business. Next and more importantly we have almost $16 billion in backlog with specific implementation schedules that provide us with a very strong view of the second half of the year. Please turn to slide 9. Now I would like to spend some time on our future growth which is underpinned by a solid book of business, flexible balance sheet and a new business momentum. In the last quarter we had a wins $2.2 billion for book-to-burn ratio of 1.1. We have been consistently adding to our backlog and have also achieved a book-to-burn ratio of 1.1 on a trailing 12 month basis. We closed the quarter with a backlog of $15.8 billion, a 2% organic increase over the first quarter of last year. In addition our backlog was strong in both segments, bolstered by 8% year-over-year EPS backlog growth excluding the impact of Libya. The PTS growth came from multiple areas including a 100% increase in our energy sector wins taking us to a record energy backlog. In MFS we were successful on the $900 million global contingency IDIQ for the US government during the quarter, which joins of portfolio of over 100 other IDIQ contracts. On a factored basis our IDIQs equate to an estimated $12 billion in additional pipeline opportunities. We also had strong PTS performance in US government wins. As you may know a transition is occurring in the Middle East today as the US military gradually shifts mission responsibility to its Department of State. In the first quarter we won a $177 million contract supporting US AID development efforts in Afghanistan. In sum our solid book of business underpins our increased confidence in both the second half of 2012 and our long-term outlook. Please turn to slide 10. we have a number of ongoing initiatives to help drive the next wave of growth at AECOM. These investment are enabled by our strong cash flow and liquidity. Let me make some comments and how we are driving this within AECOM’s financial framework and the leverage we have available to optimize financial performance. First, we believe that maintaining a consistent investment program across all economic cycle is the best way to create growth and shareholder returns. We continue to make organic investments in key growth geographies such as Qatar and Saudi Arabia and specialty end markets like sporting events and oil and gas. We expect significant capital expense to be made in our markets and we are positioning to capitalize on these opportunities. In addition to geography specific investment that John will discuss we are also investing in specialty service offerings to target high growth sectors that did well with our global platform and integrated services. For instance, last year reformed the global sport group to capture our share of the $20 billion of annual CapEx that is driven by major international sporting events. We are leveraging our recent Brazil Olympics master plan assignment to expand our other practice areas. Our second leverage M&A. We are constantly evaluating acquisition opportunities where we project returns and growth profile will be attractive for AECOM and its shareholders. Our primary focus is on emerging markets as well as power, energy and mining sectors where we see the most attractive opportunities and higher margins. We currently have several prospects at advance negotiations that if successfully completed, will significantly expand our footprint in those areas. Lastly, we continue to invest in underlying value of AECOM shares. Our share repurchases accelerated in the first quarter. The first $100 million tranche is largely complete and we have bought back about 10 million thus far and the second $100 million tranche. Now let me hand the call over to John who will discuss our market opportunities.

Thank you Mike. Diversification has been a hallmark of our business model particularly over the past decade as we have worked diligently to increase our exposure to rapidly growing markets. Now, let me spend few minutes discussing some of the highlights during the quarter from across our diversified platform. Our Asia Pacific business remains strong with continued double digit organic growth throughout the region. The growing pipeline of opportunities across Asia which includes Hong Kong, China, India and Southeast Asia is reflected in our book-to-burn ratio in the first quarter as we won over $270 million of new work. In Australia we have expanded our service offering to better service clients and capture a great share of mining CapEx. This expansion combines with our transportation and facilities business, has fueled 67% growth in backlog from a year ago. In addition we continue to evaluate potential M&A candidate in the region that can enhance our collected growth. We’re also benefitting from the surge of investment in the natural resources market in our Americas geography, specifically, in Latin America and Canada. Our environmental management business is typically an early indicator of private sector investments as permits and planning proceed development. This increased activity has resulted in a record environment management backlog of over 80% year-over-year. The commercial construction market is also beginning to improve in concert with a loosening of the credit market. A great example of this is our recent program management win on the $4 billion [Housing] project on New York’s west side. This is the most transformative project in New York City in over a generation. We’re also seeing a resurgence in the Water market where we recorded a book-to-burn ratio of 1.6 in the first quarter and wins of over $240 million. Our transportation business continues to be solid, with activities across all our market segment. This was reflected by key wins during the quarter in transit rail in the United States in cities like Dallas, New Orleans and Honolulu. In addition, we have recently become more optimistic that we will finally get a new transportation bill based on current activity on Capitol Hill and we’re also encouraged by the increased activity in T3 funding as well as projects funded by user fees and tolls. At the US federal level, we see strong prospects in environment management, USAID international development and performance-based energy efficiency contracts. As Mike mentioned earlier, in the Middle East, we’re seeing positive signs of growth and a shift from the UAE market to other geographies. For example, Saudi Arabia is investing roughly $400 billion in infrastructure over the next few years. Locally we have a backlog of roughly 1000 people and we regularly utilize out the resources to optimize our project delivery. Recently we won a major health care project that will utilize the full breath of our services and opportunity we would not have had just a few years ago. In neighboring Qatar we are well-positioned with upcoming $200 billion in capital expenditures, a market we have been active in for decades and are currently program managers for the new Doha Port, the largest Greenfield port project in the world. Similarly the increased activity in our European business highlighted by January wins that were an excess of the prior two quarters combined is showing signs of very dramatic turn around. Looking forward our growth in diversification strategies are appropriately aligned to achieve the following future objectives. Our revenue mix that is 65% international with a focus on best of growing emerging and natural resource rich market and 50% of our business coming from the private sector and significantly increased exposure to power energy and mining demand. On that note I would also like to talk a bit about momentum and specifically the traction we are seeing in our power, energy and mining end markets. As you know we have been talking about energy and power opportunities for a while and have been making strategic investments along the way. Five years ago our energy-related projects made up only 3% of our overall business and it has more been tripled to 10% today. Overall 10% is still a small part of our portfolio, but we are seeing increasing opportunities globally in this area. Let me explain why the opportunities have gained momentum and why AECOM is a partner of choice. Please turn to slide 12. The demand for energy related infrastructure continues to increase and by some estimates the market will require $1.5 trillion of investment annually. Income, global footprint, network and expertise fit naturally into the growing market and we are looking at both organic and inquisitive investment opportunities. We are moving forward in four main areas of this part of our portfolio; mining, oil and gas, renewable and transmission and distribution. In mining, 90% of the CapEx is dedicated to the infrastructure outside the mine. Our mining revenue is up 130% year-over-year and we’re working concurrently on large projects in West Africa and Australia. This is a new kind of opportunity for us. And potential customers are finding increasing value in our integrated platform of global footprint and our suite of services. For instance, we are currently working on a large mining project in Africa for an Australian customer and are delivering the work utilizing professionals across multiple geographies including Australia, Europe and North America. In oil and gas we have substantial expertise in environmental management services and are translating this into new infrastructure opportunities in and around the shale plays. To capitalize on this opportunity, we have recently established a shale center of excellence. We have a proven track record of working with the large integrated oil companies and the project specific needs of these unconventional play suites are breadth of service as well. In renewable, we’re working on several new hydropower projects in Africa, Latin America, Middle East, Indonesia and North America. We expect to see an increasing amount of revenue opportunity in renewable as companies look to supplement oil and gas production. In transmission and distribution we are rapidly expanding our presence in a market value at over $100 billion over the next four years in North America alone. Currently, we are pursuing multiple opportunities in North America, Africa and Australia. Our integrated service option fits well in this industry because of these clients’ complex project needs. In conclusion, we have a strong pipeline of opportunities and expect that the pipeline will continue to grow as we leverage our global platforms to expand our service offerings beyond our traditional markets. Please turn to slide 13. We hope you walk away from today’s call with a better understanding of how we are executing in an improving economic environment. We are seeing traction and momentum in key growing markets. And lastly, we are on-track to achieve our full year guidance and remain committed to our long-term annual earnings growth target of 15%. With that, I would like to open the line for questions and you may direct your questions either to Mike, Steve or myself, as well Jane Chmielinski. Operator, please open the line.

(Operator Instructions) Your first question today comes from the line of Andrew Obin with Bank of America-Merrill Lynch.

Just a question, can you give us some more details on cost overall in the MSS segment on two contracts; never really had the issue before, are federal contracts getting more competitive and how would we really get comfortable if it’s a one-time issue?

Hi Andrew, its Steve, I’ll address that question for you. The two contracts, I don’t think it’s a pervasive issue. The first was determination for convenience and it was really related to the Iraq drawdown. Terminations for convenience are fairly rare. This one caught us by surprise. It caught our client by surprise; in fact we just received increased task orders on this project recently before the termination for convenience. And the result was that we had some demobilization cost that were unrecoverable. The demob costs are typically recoverable, well so that even is unusual. It’s a rare case in this situation that they weren’t. The other one was just a fixed price contract Andrew that we changed our estimate in the cost to complete and took a write-down. That’s unusual for us, but in this situation occurred both are non-recurring.

But I guess the idea is, has the government changed the way they sort of deal with you guys on these things or do you think these are truly one off events never to be seen again or never to be seen for a while I guess?

Andrew, I don’t know if I can say, we can never see it again. But I think the unique thing that we saw here is that applies to the Middle East, Iraq and Afghanistan. Nobody, our clients and nor I think contracts are realized how quickly they were going to shutdown at Iraq. And as Steve mentioned just a couple of months before they gave us an extra on our contract. So they increased our contract value. The other one that Steve mentioned, it was just poor performance by our team in over writing the budget. So we’re not seeing a change in the contracts from the federal government, but as you know, everyone is on pins and needles when you’re thinking about what the federal government is going to do in terms of spending.

So, another question I have, I apologize if you missed it. Could you give us an update on collection of receivables from the MSS contract closed last quarter?

Sure. The one you’re referring to is the large close out on a project that took place over a decade. That receivable is about the same level. I believe, we said on the Q4 call that we expected collection in Q2 or Q3; that remains the same.

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

This is Brandon Verblow for Steve. My first question relates to the 2012 outlook; I guess, you mentioned that the backlog gives you confidence in 2012, but what areas do you think you still need to book work to hit your 2012 targets like in which end markets or regions?

The opportunities that we see ahead of us are very positive and they’ve been that way throughout FY’11 and then as we see going forward in ’12. The issue that we face is delay in projects starting up and converting from awarded backlog into revenue. So that has been sluggish for sometime and it continues to be sluggish, but we anticipate as the market is improving and if you look at the different indicators, the market is improving and we see an accelerated conversion of this awarded backlog into revenue in the second half of the year.

So it’s mainly a matter of how and what pace the backlog gets converted rather than only to book additional work?

Speaking of additional work Brandon I think that’s a good point you just made and another thing that gives us confidence is we had $2.2 billion of wins in the first quarter alone with the book-to-burn ratio of 1.1. So clearly the wins are accelerating. If we look at our PTS backlog for instance, excluding the impact of Libya, it grew organically at 8% so fairly significant growth on the backlog side. And then also the European turnaround that we mentioned earlier in the call where we implemented our restructuring plan in Q4 and Q1, we were in a loss making position in Q1 in Europe and that business has turned around dramatically and now we have very high expectations for it in the second half of the year bolstered by the $300 million of wins in Europe alone in January. And so which you are not seeing in these backlog numbers that was wins that came in during January. So there is a lot of things that are pointing to confidence in the second half of the year.

And I guess related to that, so compared to what your organic growth expectations were three months ago; would you say they improved better, worse or the same?

I would say they are a little bit better than they were because now we have confidence based on the wins we saw in Q1, when you see a book-to-burn ratio of 1.1, that gives you a little more confidence than some of the backlog numbers we've seen in previous quarters. So we feel better than we did three months ago.

The next question comes from the line of John Rogers with D. A. Davidson.

Just to follow-up a little bit on that, I mean based on your guidance and I think Mike you said you are looking at the second quarter being relatively flat with the first quarter, I mean it’s a pretty substantial ramp in the second half of the year and I guess I am wondering are there specific projects or hurdles that you are looking at to give you a big boost in margins or profitability in the second half or is it just a mix.

It’s actually a good question John. First of all, it’s important to point out that we have historically had a backend loaded year, right. We [did] an up tick in performance. So historically we have earned 55% of our earnings per share in the second half of the year. So that's historically, we've always had that upward slope. And what I said was that Q2 will be similar to Q1. So if you extrapolate that out and just take the midpoint of our guidance range, it implies that instead of having 55% of our earnings per share in the second half, we will have 68%. So what drives that, so you are right, you are spot on to the right issue, John. So what gives us confidence in that increased earnings in the second half of the year. First of all, just let's look at Europe alone. Europe alone, we lost money in the first quarter. We have turned that business around through the restructuring and we will have a $25 million swing in EBIT from the first half of the year to the second half of the year just in Europe. So that $25 million swing makes up half of the difference between that 55% and 68% that I mentioned. That’s half of it alone. Secondly, on the project performance question you asked, as Steve mentioned the MSS projects. Those two projects contributed to a $6 million of loss in the first quarter. We are not going to see those in the second half of the year. So that makes up another piece and then the third piece that give us confidence in that movement in the second half of the year is the point that John made that we can see our backlog pretty clearly. We’ve got good visibility in the second half of the year and we are seeing the work that was a little slow in converting it from the win to the revenue. We are winning the work and now we just need to convert it into revenue. That was a little slow in Q1 and right now in Q2, but we’ve got good visibility to when those projects come online in the second half. Those are the really, the three major components that give us that confidence.

One other quick thing. You mentioned the share repurchases and I missed those numbers, could you tell me what you bought and where you are in that second half?

Sure, as you know we announced an authorization of a $200 million share buyback. We executed on the first $100 million tranche and we did an accelerated share repurchase program at the beginning of the fiscal year. We then have been executing in the open market on the second $100 million tranche and as of today, we’ve bought back about $10 million worth of stock against that second tranche.

Your next question is from the line of Andy Kaplowitz with Barclays Capital.

Could you talk about the mix of backlog in the sense that you had awarded backlog up pretty significantly and contracted backlog down a little bit and what I am really getting at to is the private non-residential markets like there are large projects out there, are you starting to see any of them actually hit your awarded backlog yet?

You mean, hit our contracts there?

Well, I mean because awarded was up a lot, John. So, it doesn’t seem like they are hitting contracted, but may be they are hitting awarded.

As I said from the first call, the issue is converting our awarded backlog into contracted backlog. It’s been little bit sluggish. But specifically on the commercial side and with mostly in the commercial side, we don’t really do much in the residential side you know. We are seeing a pickup on the commercial side. Yeah I mentioned in my remarks about the west side, the west side yards which is a multi-billion dollar development program, we were just awarded the program management. And we are seeing a lot of that, the Moynihan station here in New York, the win in construction management. Now we are seeing more spending on the private side, the private commercial side and that’s accelerating and it’s been accelerating over the past two quarters.

One of the things that we’ve talked about in the past is, so you are talking about converting awarded to contracted and we have also talked about converting backlog to revenue, right. And so you know, people have talked about a slowing in the emerging markets, the second half of last year, calendar last year and through today. Have you seen any slowdown in converting revenue in any of these high growth areas for you guys? Do you expect to see any or may be things are starting to improve already. Can you give us a lay of the land in places like Asia and other emerging markets?

We haven’t seen a slowdown. If anything, we’ve seen the acceleration in the Middle East, in Qatar and in Saudi Arabia. As I’d mentioned, the market has moved from the UAE to Saudi and in Qatar. And in Asia, I mean Asia is, when we look at it, different markets. Hong Kong and China still remain very strong. And by the working, we converting it into backlog and into revenues at a very nice pace, the same thing in Australia. The place, in terms of emerging markets that we have seen a slowdown in converting the wins that we have into revenue, it’s been in India. It’s taking a bit longer than we ever anticipated. But again, the good news is we have the opportunities, the bad news is it is taking a little bit longer, but again, it’s not a big part of our market just yet. And it’s not a big part of the revenue that we had in 2012.

Okay. I hesitate to ask you guys this, but I’ll do it anyway. Libya, any chance we’re going to see a comeback in Libya in 2012?

In 2012, I would hope to say yes. But I am not an optimist on Libya. I mean, I think, there are a lot of things that need to happen in that country. We’ve been in contact with our clients. So, we have had people back in to Libya to see where we can be helpful to the new government and how we can jumpstart the project. But I still think it’s several months off before we get any clear direction of which way the government is going. We have got the commitment that the project would go ahead and we could reinitiate our activities, but we haven’t seen anything beyond the commitment.

Just quickly on currency, anything on the currency effect on the backlog this quarter?

The currency effect on the backlog year-over-year is dead neutral.

Sequentially too, Mike?

Sequentially, it is a little up, a little up. We announced that you remember in the last earnings call we saw that first tick up right at the beginning of the quarter.

Your next question comes from the line of Chase Jacobson with William Blair.

I just wanted to talk about the acquisition strategy a little bit. Just in terms of the strategy. You talk a lot about adding services and adding your footprint and how that helps improve your organic growth profile. But I am just wondering if you can maybe give us a little bit of color on how you look at these in terms of financial returns. If we look at your return on capital over the last couple of years has come down quite a bit and I was just trying to get a sense of what outlook for type of returns are?

Our typical target returns, we are looking for a 20% ROI on acquisitions and the acquisitions as you've heard us say in the past Chase, they fall into two categories. Either we are buying a geographic platform through which we will drive the rest of our service offerings through or we are buying a specialty service that we will drive through the rest of our geographic platform. So it falls in one or two categories and the type of opportunities that we are looking at are in markets that we believe present an outsized growth opportunity. So those are either some of the emerging markets that you've heard us talk about in the past or it’s in the power energy and mining sector that you heard John talk about earlier and that area for us, it historically was about 3% of our business, it’s now up to 10% of our business. It’s the fastest growing part of our business and we are interested in continuing to make investments in those higher growth areas from an end market perspective and then from an emerging geographic perspective.

Okay and then that actually kind of leads into my next question. Given that power and energy and mining are such strong markets and you do have such a diverse footprint at this point in time, when you go and look at your businesses, is there a potential that you would ever maybe look to exit any of the markets that you are in, if there's any maybe lower margin businesses or services that you offer now, is there any chance down the road that maybe those could be pushed to a different company.

I think that the way we look at it, it would be maybe not exiting the end market, but we could migrate from providing certain services because the size at AECOM isn’t and that our appetite and our ability to be successful, we tend to go to larger projects, the big mega projects and we might not play in a market of the smaller projects. I mean that’s something we are always considering. Right now we see a good play for providing fully integrated services, which goes from planning right through the construction management. But its something we are always evaluating. And its really have to be part of our business strategy and as we look forward in playing our strategic plan we pressure test that all the time, see what makes sense.

Your next question is from the line of Joe Ritchie with Goldman Sachs.

I am just trying to connected dots a little bit here. You’ve got nice book to bill this quarter of 1.1. You mentioned the hard time converting your voted backlog to contracted backlog. I guess my question is your ramping through the year what gives you the confident that the projects are going to start ramping up in the second half of the year and which end markets are going to see that specifically?

Joe, what give this confident is we have project teams all over the world looking at our backlog very specifically with start dates. Right. So we schedule out, we have implementation scheduled out on our projects that allows us to forecast our revenue and therefore forecast our labor needed to deliver on those projects. So we have a fairly robust forecasting process here within the organization and we can get pretty clear visibility to the next three quarters. And of course the closer we are, the higher the degree of clarity.

And is there anything specifically that could derail the timing of those projects moving forward?

There is nothing macro. Of course, on a one-off basis there is always a project here or there. We think it’s a slowdown within the governmental agency decision making process. But there is nothing from a macro perspective that I can see that would impact that.

Hey Joe, just a, from a different point of view, our revenue is comprised about 30000 projects. So there is not one project no matter how large it is, if it was over it would disappear, it would have a significant impact on our revenue. And say, next step where we keep talking about the diversification. So it’s not, as Asia and Australia going gangbusters, Middle East strong, the good news and we probably didn’t speak about is Europe. I mean, for the last year we were telling everyone else how tough Europe was but they won in one month more than they won in the prior quarter.

Okay. Now that is helpful. I guess one last question and then I will stop beating a horse here. I guess based on what you already have in your backlog today, do you really need to book much more in order to meet your expectations, your revenue growth expectations for the year.

Joe, it’s not about booking more work to meet the next couple of quarter. We have to be booking $2 billion plus a quarter for the future. We are booking revenue. We are not selling. We are now for 2013. Right. So, yeah. There is always, depending on the nature of our which end markets, some businesses are quicker book-to-burn. And so you got to sale work yet to deliver on Q4. But given the backlog we have and the scheduled out implementation plans, we feel really good about it. But we got to keep booking $2 billion plus a quarter for 2013 and 2014 and forward.

Now, of course, I had, my question was really more related to 2012 and I guess, one last question for you on the one project that is expected to be completed, next quarter, can give us a sense on percentage of completion and then as this project going to be moving forward, I guess, it’s your margin and if you could provide some kind of impact the next quarter, that would be helpful. Thanks.

Are you referring to the MSS project that…?

Yeah, that’s correct.

That is schedule to be complete in Q2 and we don’t expect any further hits from that project.

I just wanted to go back to one question that you asked that you think we need to book anymore work for ’12. Think what message that I’ll send to you folks. We said we’re not looking any work in the next quarter. I mean that would send a major rumble through the investment community. I mean, I think, it’s key that we always need to be looking at new opportunities as we push for organic growth.

The next question comes from the line of Tahira Afzal with KeyBanc.

First question is in regards to Europe, just digging a little deeper. You know, you’re expecting a 25 million swing in the second half of the fiscal year. How much of that is really just tied to restructuring and stable environment as you’re seeing it right now, versus a potential uptick. So, I would love to know your macro assumptions around Europe as this year progresses? And then, number two, the strong bookings you’ve seen in the first month of the year and month of the quarter could you talk about whether that is coming from general activity levels being up or whether you are gaining some market share or doing something different?

First of all I’ll start with macro assumptions. We are not building in significant GDP growth in Europe, either GDP growth or sector growth into our models that is not what we are anticipating. Europe will be slow. The big turnaround for us was restructuring our organization to get our cost structure in line with the revenue and that is the biggest part of the turn around and so when Europe declined a year ago we had to restructure our workforce and we had to restructure our lease commitments. Those two things happened in Q4 of 2011 or 2012. That is big single biggest contributor. Now moving on the next point about the wins, the $300 million of wins that we mentioned were projects that we have been pursuing for quite some time and we were very delighted about it and those you could see those kind of wins every month in every quarter but we are seeing some really interesting opportunities in Eastern Europe, opportunities in Turkey, for sports stadiums, significant new high speed rail line in Europe. There are opportunities there, but we are starting to see some cracks that are causing some optimism but we are not expecting a dramatic economic growth.

And got it that was helpful and just following on to that answer, you know, you talked earlier in your prepared commentary about having setting up an internal group that focuses on sports events. Could you talk about some of the milestones you've set for that group to really see gaining traction and what the timing of those could be during the year? And then just recycling back to Europe could you talk a bit if possible about the utilization rates you had within your offices there and where do you think they would head as they go into, progress in 2012.

Okay, so that's a multi part question so let me try and take it apart. The single biggest milestone in the sports end market for us has already been achieved and that was winning the master plan for the Rio Olympics. When you look at major sporting events, there's about $20 billion a year that is spent on major sporting events. And I am talking about World Cup, Olympics, Commonwealth Games, etcetera. And as you know we were the master planners for the London Olympics of 2012. We recently won the master planning work for the Rio Olympics of 2016. So that was a significant milestone because the master planning work, our hope and our expectation is that that will lead into all the other work that will surround the enormous amount of money that will be spent around that game. The 2014 World Cup in Brazil for instance we are already working on two of the stadiums that are being built in the country. There will be many more to be built. So the milestones are that we schedule out all of these major sporting events over the next, we are looking out to a World Cup 2020, I guess 2018 sorry, but also looking out to, we are working with two groups on pursuing the bid for Olympics in 2020 already. So the milestones are pretty far out there and the lean time is very long but we have made the nice progress on that.

This is Steve. On the utilization side in Europe it really depend on the type of business that we are doing over there in transportation for instance we run fairly high and some of our consulting practices run fairly modestly but I would if you are trying to model the utilization come around 65 to 70% would be right.

Your next question is from the line of Adam Thalhimer with BB&T Capital Markets.

My first question is on Afghanistan. It was interesting reading in the paper this morning they are talking about joined inter combat operations and I am just curious what happened happen in Iraq and what happened in Afghanistan as well in terms of the government pulling out faster than expected?

I thought it was interesting in the paper today and what we heard from today, that yesterday that they made these announcements. What we see going on in Afghanistan, which is a little bit different than Iraq is that over the next 12 to 18 months there is going to be search in our approach to the region and so that we try to gain a position, I am speaking about the United State, to gain position so they will be able to pull out by mid ‘14. What we’ve seeing right now we have 4500 people in Afghanistan. By March of 13 we need to have 88000 people and we’re involved in three types of work. One is O&M of equipment, (inaudible) all the repairing them, getting them in good equipment readiness, and I think there is this thousands and thousands of pieces of equipment that we are working on. The second phase is a training program where we support the training and development of the Afghanis to takeover in the O&M piece that when we leave, they can take that over. And also we are involved in a training of the government in terms of being prepared to take on services which the US contractors and the military are undertaking. And then the third piece is, yeah that’s with DoD and the third piece is with the USAID where we are supporting the efforts in economic development, trade development and infrastructure development, in laying out what the future infrastructure should be. We see ourselves and we plan that one day we’re not going to be there, just to give you an idea of when we are at the height, about 60% of our MSS work was in Afghanistan and Iraq. Now we are about 35% in the Afghanistan and we are in the process of looking to 2014 when we may be exiting and we are looking at federal government in other areas that we want to expand our capabilities, continue to do some training of personnel, looking at DoE as an opportunity for us, looking at some of the new programs that the military will be undertaking in other places around the world. So what we’re seeing is things should move consistently through about 2014 and then at that time, it will probably, you know get minimize and we’ll be added there probably by 2015.

And then I am just curious whether, you know, given the success you had in the month of January, whether you would be willing to say that, you think backlog growth will accelerate in Q2?

Yeah, I really don’t want to try and make predictions now on Q2. It’s too early. We’re a month in to it. And it’s probably too early to start making predictions on quarter-specific wins.

Your next question comes from the line of Min Tang-Varner with Morningstar. Min Tang-Varner: I have a quick question on your MSS segment. I know, you mentioned that you’re looking at some contract mix changes and that’s one of the major reason why their revenue declined substantially. I am just curious, going forward do we also see this as revenue wise, a typical low rate or do you actually think that the revenue will actually materially pick up in the second half as well?

Are you talking about gross revenue or NSR? Min Tang-Varner: Gross revenue.

The change in mix that you heard us talking about, and it relates to John’s comments where we’ve had historically, if you go back a few years, we had 65% of our work in the MSS segment was in Iraq and Afghanistan and that work was heavily dependent on outsourced contractors that worked for us. So we had high gross revenue and lower NSR. Now as you know we are only have 30% of that MSS segment exposure in Iraq and Afghanistan, because we have repositioned our work into the intelligence community and sensitive departments within the US government here on US soil; it’s also impacted by our JVs where had differing amounts of JV income and you see that in the minority interest line on our financial statement. So you need to model and also we’re bringing in income that is not hitting the revenue line. So when we look at the business, we’re looking at the EBIT that is delivered both from the top part of the financial statement as well as the minority JV amounts. But, so there is a number of moving factors there that as you’re seeing work shifting to more NSR type work, that’s pass through cost type work that we saw with our CSA joint venture in the Middle East and of course the JV numbers skewed the results. Min Tang-Varner: So in terms of the top line revenue growth going forward, is it fair to say that the top line at least, the gross revenue line would be majorly rely on the PTS segment while on the MSS side it would mostly coming in from the margin contributions, is that – I am sorry and gross profit after direct cost line then?

I am not sure I understand your question. Min Tang-Varner: When we are looking at the company’s growth profile on the top line which you know is your gross revenue if your PTS revenue is heading downward because you are changing your contract mix and having actually recoup most of the revenue earnings either from your JV or from operating outside of the direct cost kind of line, do we have, is it fair to say that your corporate wide earnings revenue growth would be primarily relying on the PTS segment?

Let me just clarify. The explanation I was giving you was to your question about the MSS segment. So the JV income, the shifting work in the departments from DoD in the Middle East to States right here, that are all related to the MSS segment. So let me take your question separately because now you've added the PTS element into it. On the PTS side, what I said earlier should give you an indicator of what we can expect from that sector in the quarter. Excluding the impact of Libya, the PTS backlog grew 8% organically. We had a book-to-burn ratio of 1.1, and those are the two best indicators to help you think about a model for revenue growth in the PTS segment. So those are indicators that could point you in the right direction. Now moving to the MSS segment, which is a very different structure. You should not be as focused on gross revenue. Two reasons; one, the changing nature of the business which is moving from a business that had a lot of pass-through costs that are included in gross revenue to a business that is more net service revenue or work that's performed by us directly. Secondly what is, its not as important in that sector because you have significant JV income; joint venture income that is coming in and so when we’re structuring our deals and our joint venture with our clients, we are looking at the EBIT that it will deliver. So unfortunately for you its difficult to model net service revenue in the MSS segment and even more difficult to model gross revenue. But if you focus on modeling a growth in the EBIT, that will be the easiest way your operating income in your lexicon, that will be the easiest way for you to build the model. Min Tang-Varner: And the other question I have is actually you know heading back to your M&A comment, I am just curious because during 2010 you did quite a few deals, in 2011 it get into a bit low period where you digested off your acquisitions. So heading into 2012, do you actually think that deal spilt would actually pick-up or the size of the transactions will actually naturally pick-up?

We are looking at strong pipeline right now and we’re focusing in on some deals in Latin America, Africa and Asia. Min Tang-Varner: So do you actually think that for the target that you are looking at, is the pricing very attractive now or do you actually think they are still price high?

I think its about the same; I mean you know it depends where you go; you know in India they startup with a very high pricing and it depends on your negotiation. But it hasn’t really changed much; there are no fire-sales out there; that’s for sure. Min Tang-Varner: And lastly, I just have – I am just curious if you can give us some comments on the margin profiles of these different projects that you are going after, you know of the sporting events or other public works versus mining and power projects; is there a margin differential between different kinds of projects that you are looking at?

Yes, its something we’ve been talking about for a while its changing the nature of the projects that we’re pursuing, where the margins are greater. And so overtime, if you’ve been following company for a while, we have been moving more into program management, construction management and program management type of work is certainly in the major sporting event category that has the highest margins. And so we have for quite sometime, over the past several years, we’ve moved our margins up a couple of hundred basis points and that continuing shift in service offering in markets will drive us towards our 2015 goal of 12% EBITDA margins.

Your final question today comes from the line of Andrew Wittmann with Robert W. Baird.

I just had a question on the margins as well, you know adding back the effect of European restructuring in the MSS contract, I think it’s probably good for, I don’t know somewhere around 50 basis points of EBIT margin. I guess what are you guys seeing in the business that may be could help offset that in a way of pricing and is there something going on in the pricing environment that might be pressuring margins a little bit?

Well, Andrew the margins, I think you are right. On a pro-forma basis if you add-back some of those one-time, the underlying margins were pretty good and we’re getting that through a number of ways. The revenue obviously which is in the pricing side, but also through the margin improvement initiatives that we’ve talked about which are in the project performance, the mix of work into higher margin businesses and the scale of advantages of driving the larger business through our platform.

But just looking at kind of on a sequential basis and may be this is not fair because of some seasonality even adding back some of those charges seem to indicate that there is something else that might be weighing in the margins, on the negative side. I am just looking to capture some of that effect may be?

You know, sequentially I think it’s a difficult comparison because we are so seasonal. And so that comparison I just gave you where we are actually up on a year-over-year basis, on a gross revenue margin basis for MSS and on a PTS margin basis on NSR, those margins underlying net of the one-time charges are up year-over-year. And because Q1 is such a low volume quarter for us, you can’t really compare to the Q4 which is one of our highest volume quarters.

But on a net revenue basis, so even on your year-ago period, EBITDA margins were 11.7. Now they are more like of 11 if you add back some of those one-timers. And I guess, I am looking for, trying to understand the gap there on that kind of 70 basis points differential?

Year-ago, I have it at 9.65% on EBITDA margin basis.

EBITDA over NSR.

Yeah.

Ladies and gentlemen, this concludes the question-and-answer portion of today’s event. I would like to turn the call back over to management for some closing remarks.

Okay. I would like to thank everyone for joining our call today and for your continued interest in AECOM. If you have any further questions, please feel free to give us a call and we’ll enjoy speaking with you. With that, we’ll be back online in three months. Take care and thank you.

Ladies and gentlemen, thank you for your participation in today’s conference. This does conclude the presentation and you may now disconnect. Have a great day.