Tetra Tech Reports Record First Quarter Results

  • Record Net Revenue $737 million
  • Record EPS $2.18; Record Adjusted EPS $1.34, up 13% Y/Y
  • Record Backlog of $3.81 billion, up 11% Y/Y

Tetra Tech, Inc. (NASDAQ: TTEK), a leading provider of high-end consulting and engineering services, today announced results for the first quarter ended January 1, 2023.

First Quarter Results

Tetra Tech achieved record high quarterly results in key financial metrics, including net revenue, operating margin, EPS and backlog. Revenue in the first quarter totaled $895 million and revenue, net of subcontractor costs (net revenue)1, was $737 million. Operating income was $92 million; adjusted operating income was $97 million, up 17% year-over-year, which reflects a 90-basis point increase to an all-time high adjusted EBITDA1 margin of 14.0%. Earnings per share (“EPS”) was $2.18; adjusted EPS was $1.34, up 13% over first quarter fiscal 2022. Backlog increased to $3.81 billion, up 11% year-over-year, and up 14% on a constant currency basis.

Quarterly Dividend

On January 30, 2023, Tetra Tech’s Board of Directors approved a $0.23 per share dividend, payable on February 24, 2023, to stockholders of record as of February 13, 2023. This represents a 15% increase year-over-year and the 35th consecutive quarterly dividend.

Chairman and CEO Comments

Tetra Tech Chairman and CEO Dan Batrack commented, “Tetra Tech began fiscal 2023 with record high net revenue and earnings as a result of our strong operations where we are Leading with Science® in the areas of water, environment and sustainable infrastructure. On a year-over-year basis, we saw double-digit top line growth across both our government and commercial end markets. We also had new orders approaching $1 billion in the quarter contributing to an all-time high backlog of $3.81 billion which further improves our outlook for fiscal 2023 and beyond.”

Mr. Batrack further stated, “We are very pleased to announce that we successfully closed the RPS Group transaction at the end of January. The addition of RPS aligns with our strategy to be the premier global high-end consulting and engineering firm addressing the impacts of climate change. RPS brings 5,000 staff that significantly expand our position in U.K. water programs, and add energy transformation expertise in the U.K., Europe and Australia.”


Non-GAAP financial measures which the Company believes provide valuable perspectives on its business results.

Business Outlook

The following statements are based on current expectations. These statements are forward-looking, and the actual results could differ materially. These statements do not include the potential impact of transactions that may be completed or developments that become evident after the date of this release. The Business Outlook section should be read in conjunction with the information on forward-looking statements at the end of this release.

Excluding RPS, Tetra Tech expects EPS for the second quarter of fiscal 2023 to range from $1.03 to $1.08 and net revenue to range from $685 million to $735 million. For fiscal 2023, Tetra Tech is increasing EPS guidance to now range from $4.90 to $5.05 and is increasing net revenue guidance to range from $3.00 billion to $3.15 billion.2

RPS is expected to contribute additional net revenue of approximately $100 million in the second quarter and $400 million for fiscal 2023. The impact to adjusted EPS, excluding transaction, integration and intangible amortization expenses, is expected to be approximately $0.10 dilutive for the second quarter and $0.10 accretive in the second half of the year, resulting in neutral impact for fiscal 2023.3


Investors will have the opportunity to access a live audio-visual webcast and supplemental financial information concerning the first quarter of fiscal 2023 results through a link posted on the Company’s website at tetratech.com on February 2, 2023, at 8:00 a.m. (PT).

Reconciliation of GAAP and Non-GAAP Items

In thousands (except EPS data)


Three Months Ended


Jan. 1, 2023


Jan. 2, 2022


% Y/Y











Subcontractor costs










Net revenue
















Operating income










Acquisition related costs









COVID-19 Credits









Adjusted operating income


























FX hedge gain









Acquisition related costs









COVID-19 Credits









Adjusted EPS











2 Reconciliation of the net revenue guidance to the most directly comparable GAAP measure is not available without unreasonable efforts because the Company cannot predict the magnitude and timing of all the components required to provide such reconciliation with sufficient precision.

3 Reconciliation of adjusted EPS guidance to the most directly comparable GAAP measure is not available without unreasonable efforts because the Company cannot predict with sufficient precision all the components required to provide such reconciliation, including transaction, integration, and intangible amortization expenses related to the RPS transaction.

About Tetra Tech

Tetra Tech is a leading provider of high-end consulting and engineering services for projects worldwide. With 27,000 associates working together, Tetra Tech provides clear solutions to complex problems in water, environment, sustainable infrastructure, renewable energy, and international development. We are Leading with Science® to provide sustainable and resilient solutions for our clients. For more information about Tetra Tech, please visit tetratech.com, follow us on Twitter (@TetraTech), or like us on Facebook.

Forward-Looking Statements

This release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The use of words such as "anticipate," "expect," "could," "may," "intend," "plan" and "believe," among others, generally identify forward-looking statements. These forward-looking statements are based on currently available operating, financial, economic and other information, and are subject to a number of risks and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results. A variety of factors, many of which are beyond our control, could cause actual future results or events to differ materially from those projected in the forward-looking statements in this release, including but not limited to: continuing worldwide political and economic uncertainties; the U.S. Administration’s potential changes to fiscal policies; the cyclicality in demand for our overall services; the fluctuation in demand for oil and gas, and mining services; risks related to international operations; concentration of revenues from U.S. government agencies and potential funding disruptions by these agencies; dependence on winning or renewing U.S. government contracts; the delay or unavailability of public funding on U.S. government contracts; the U.S. government’s right to modify, delay, curtail or terminate contracts at its convenience; compliance with government procurement laws and regulations; the impact of global pandemics like COVID-19; credit risks associated with certain clients in certain geographic areas or industries; acquisition strategy and integration risks; goodwill or other intangible asset impairment; the failure to comply with worldwide anti-bribery laws; the failure to comply with domestic and international export laws; the failure to properly manage projects; the loss of key personnel or the inability to attract and retain qualified personnel; the ability of our employees to obtain government granted eligibility; the use of estimates and assumptions in the preparation of financial statements; the ability to maintain adequate workforce utilization; the use of the percentage-of-completion method of accounting; the inability to accurately estimate and control contract costs; the failure to adequately recover on our claims for additional contract costs; the failure to win or renew contracts with private and public sector clients; growth strategy management; backlog cancellation and adjustments; risks relating to cyber security breaches; the failure of partners to perform on joint projects; the failure of subcontractors to satisfy their obligations; requirements to pay liquidated damages based on contract performance; the adoption of new legal requirements; changes in resource management, environmental or infrastructure industry laws, regulations or programs; changes in capital markets and the access to capital; credit agreement covenants; industry competition; liability related to legal proceedings, investigations, and disputes; the availability of third-party insurance coverage; the ability to obtain adequate bonding; employee, agent, or partner misconduct; employee risks related to international travel; safety programs; conflict of interest issues; liabilities relating to reports and opinions; liabilities relating to environmental laws and regulations; force majeure events; protection of intellectual property rights; stock price volatility; the ability to impede a business combination based on Delaware law and charter documents; and other risks and uncertainties as may be described in Tetra Tech’s periodic filings with the Securities and Exchange Commission, including those described in the “Risk Factors” section of Tetra Tech’s Annual Report on Form 10-K for the fiscal year ended October 2, 2022. Readers should not place undue reliance on forward-looking statements since such information speaks only as of the date of this release. Tetra Tech does not intend to update forward-looking statements and expressly disclaims any obligation to do so.

Non-GAAP Financial Measures

To supplement the financial results presented in accordance with generally accepted accounting principles in the United States (“GAAP”), we present certain non-GAAP financial measures within the meaning of Regulation G under the Securities Exchange Act of 1934, as amended. We provide these non-GAAP financial measures because we believe they provide a valuable perspective on our financial results. However, non-GAAP measures have limitations as analytical tools and should not be considered in isolation and are not in accordance with, or a substitute for, GAAP measures. In addition, other companies may define non-GAAP measures differently which limits the ability of investors to compare non-GAAP measures of Tetra Tech to those used by our peer companies. A reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is included in this release.


Jim Wu, Investor Relations

Charlie MacPherson, Media & Public Relations

(626) 470-2844

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