TRC Companies Inc. (TRR, Financial) filed Quarterly Report for the period ended 2010-12-24.
Trc Cos has a market cap of $97.6 million; its shares were traded at around $3.6 with and P/S ratio of 0.4. Hedge Fund Gurus that owns TRR: Jim Simons of Renaissance Technologies LLC. Mutual Fund and Other Gurus that owns TRR: Chuck Royce of Royce& Associates.
COS increased $1.8 million, or 3.7%, to $51.7 million for the three months ended December 24, 2010 from $49.9 million for the same period in the prior year. The increase in COS was related, in part, to a $1.0 million increase in bonus expense. The increase in our bonus expense was due to improved current period operating performance relative to our fiscal year 2010 earnings targets for the respective periods. In addition, the increase in COS also included a $0.6 million charge incurred for the early termination of an office lease. As a percentage of NSR, COS was 85.7% and 92.0% for the three months ended December 24, 2010 and December 25, 2009, respectively.
Gross revenue decreased $1.5 million, or 0.9%, to $163.1 million for the six months ended December 24, 2010 from $164.6 million for the same period in the prior year. Current period gross revenue in our Infrastructure operating segment decreased $2.8 million primarily due to the wind-down of a large transportation design project, certain actions taken in the prior fiscal year to eliminate lower margin work and lower overall demand due primarily to revenue shortfalls at state and municipal levels. In addition, current period gross revenue in our Environmental operating segment decreased $2.6 million primarily due to a decline in work performed by our subcontractors. In the comparable period in fiscal year 2010, our projects experienced higher levels of subcontracting and procurement activity and, therefore, generated higher gross revenues and other direct costs (“ODC's”). This increase was offset, in large part, by increased gross revenue in our Energy operating segment primarily due to increased activity on electric transmission and distribution projects.
NSR increased $6.7 million, or 6.0%, to $117.9 million for the six months ended December 24, 2010 from $111.2 million for the same period in the prior year. NSR in our Energy operating segment increased $3.8 million in the six months ended December 24, 2010 primarily due to the aforementioned increased activity on electric transmission and distribution projects. Current year NSR in our Environmental operating segment also increased $7.2 million primarily due to the improved project performance on certain Exit Strategy contracts and a moderate increase in demand for our environmental services. These increases were offset, in part, by a $3.9 million decrease in our Infrastructure operating segment, the result of the wind-down of a significant transportation design project and lower overall demand from state and municipal clients which have experienced significant revenue shortfalls.
COS decreased $2.5 million, or 2.5%, to $98.3 million for the six months ended December 24, 2010 from $100.8 million for the same period in the prior year. The decrease was related, in part, to a $1.9 million decrease in Exit Strategy contract loss reserves. As discussed above, increases to our Exit Strategy cost estimates did not occur at the same level in the current period as compared to the same period last year. In addition, the decrease in COS was attributable to a $1.8 million reduction in payroll due to headcount reductions primarily in our Infrastructure operating segment and a $2.1 million decrease in fringe benefit costs associated with our self-insured medical benefits plan, due, in part, to plan design changes. These decreases were partially offset by higher bonus costs and a charge incurred for the early termination of an office lease. As a percentage of NSR, COS was 83.3% and 90.6% for the six months ended December 24, 2010 and December 24, 2010, respectively.
The federal and state income tax provision was $0.7 million for the six months ended December 24, 2010 compared to a tax benefit of $4.4 million for the same period in the prior year. We recognized a net tax benefit of $4.4 million in the six months ending December 25, 2009 primarily due to (i) the Worker, Homeownership, and Business Assistance Act of 2009 which amended I.R.C. §172(b)(1)(H), allowing taxpayers to elect to carry-back an applicable net operating loss for a period of 3, 4, or 5 years, to offset taxable income in those preceding years and enabling us to carry-back our fiscal year 2008 net operating loss for a tax benefit of $2.8 million, which amount was collected in January 2010, and (ii) the re-assessment of our uncertain tax positions based on communications with the IRS relating to its examination including the impact of the net operating loss law change which resulted in an income tax benefit of $1.9 million.
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Trc Cos has a market cap of $97.6 million; its shares were traded at around $3.6 with and P/S ratio of 0.4. Hedge Fund Gurus that owns TRR: Jim Simons of Renaissance Technologies LLC. Mutual Fund and Other Gurus that owns TRR: Chuck Royce of Royce& Associates.
Highlight of Business Operations:
Gross revenue increased $2.0 million, or 2.5%, to $84.3 million for the three months ended December 24, 2010 from $82.3 million for the same period in the prior year. Current quarter gross revenue in our Energy operating segment increased $4.3 million primarily due increased activity on electric transmission and distribution projects as our clients began to resume investments in capital projects that were delayed throughout fiscal year 2010. Current quarter gross revenue in our Environmental operating segment decreased $2.7 million primarily due to a decline in work performed by our subcontractors. In the comparable period in fiscal year 2010, our projects experienced higher levels of subcontracting and procurement activity and, therefore, generated higher gross revenues and other direct costs (“ODC's”).COS increased $1.8 million, or 3.7%, to $51.7 million for the three months ended December 24, 2010 from $49.9 million for the same period in the prior year. The increase in COS was related, in part, to a $1.0 million increase in bonus expense. The increase in our bonus expense was due to improved current period operating performance relative to our fiscal year 2010 earnings targets for the respective periods. In addition, the increase in COS also included a $0.6 million charge incurred for the early termination of an office lease. As a percentage of NSR, COS was 85.7% and 92.0% for the three months ended December 24, 2010 and December 25, 2009, respectively.
Gross revenue decreased $1.5 million, or 0.9%, to $163.1 million for the six months ended December 24, 2010 from $164.6 million for the same period in the prior year. Current period gross revenue in our Infrastructure operating segment decreased $2.8 million primarily due to the wind-down of a large transportation design project, certain actions taken in the prior fiscal year to eliminate lower margin work and lower overall demand due primarily to revenue shortfalls at state and municipal levels. In addition, current period gross revenue in our Environmental operating segment decreased $2.6 million primarily due to a decline in work performed by our subcontractors. In the comparable period in fiscal year 2010, our projects experienced higher levels of subcontracting and procurement activity and, therefore, generated higher gross revenues and other direct costs (“ODC's”). This increase was offset, in large part, by increased gross revenue in our Energy operating segment primarily due to increased activity on electric transmission and distribution projects.
NSR increased $6.7 million, or 6.0%, to $117.9 million for the six months ended December 24, 2010 from $111.2 million for the same period in the prior year. NSR in our Energy operating segment increased $3.8 million in the six months ended December 24, 2010 primarily due to the aforementioned increased activity on electric transmission and distribution projects. Current year NSR in our Environmental operating segment also increased $7.2 million primarily due to the improved project performance on certain Exit Strategy contracts and a moderate increase in demand for our environmental services. These increases were offset, in part, by a $3.9 million decrease in our Infrastructure operating segment, the result of the wind-down of a significant transportation design project and lower overall demand from state and municipal clients which have experienced significant revenue shortfalls.
COS decreased $2.5 million, or 2.5%, to $98.3 million for the six months ended December 24, 2010 from $100.8 million for the same period in the prior year. The decrease was related, in part, to a $1.9 million decrease in Exit Strategy contract loss reserves. As discussed above, increases to our Exit Strategy cost estimates did not occur at the same level in the current period as compared to the same period last year. In addition, the decrease in COS was attributable to a $1.8 million reduction in payroll due to headcount reductions primarily in our Infrastructure operating segment and a $2.1 million decrease in fringe benefit costs associated with our self-insured medical benefits plan, due, in part, to plan design changes. These decreases were partially offset by higher bonus costs and a charge incurred for the early termination of an office lease. As a percentage of NSR, COS was 83.3% and 90.6% for the six months ended December 24, 2010 and December 24, 2010, respectively.
The federal and state income tax provision was $0.7 million for the six months ended December 24, 2010 compared to a tax benefit of $4.4 million for the same period in the prior year. We recognized a net tax benefit of $4.4 million in the six months ending December 25, 2009 primarily due to (i) the Worker, Homeownership, and Business Assistance Act of 2009 which amended I.R.C. §172(b)(1)(H), allowing taxpayers to elect to carry-back an applicable net operating loss for a period of 3, 4, or 5 years, to offset taxable income in those preceding years and enabling us to carry-back our fiscal year 2008 net operating loss for a tax benefit of $2.8 million, which amount was collected in January 2010, and (ii) the re-assessment of our uncertain tax positions based on communications with the IRS relating to its examination including the impact of the net operating loss law change which resulted in an income tax benefit of $1.9 million.
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