if you haven't had time to respond to my reply
since 2/3/00 or if you are just another disgruntled
DMer or ex-DMer coming on this board to stir things up
without factual basis, but I am still curious as to which
large clients are leaving URS.
usrgwcformer is correct to say that the
accounting systems are a bit behind the times... but urs
management has always survived with the basic financial
facts, nothing fancy, concentrating on the business,
just getting the bills out and collected was the
important thing, not flashy systems. Now they are looking
to radically change everything, which will cost
valuable time, cash and energy. Arthur Anderson is
probably smiling --- they will reap a bundle on consulting
fees. This has never been the course with any other
acquisition... wonder how they will make it work?
If you took a look at MK's past you'd see that he
is quite capable. He was able to bring URS from a
bankrupt position to where they are today - largest design
firm in the industry overall. He is a visionary CEO
and dispite the stock position today, I have no doubt
that MK and Ainsworth (CFO) can put the backbone into
the stock yet again. They are the turnaround kings
and this is another turnaround opportunity for them.
Risks: What you are consistently seeing on the message
board is a concern about the debt load and that is a
concern!! URS buys companies that come cheap and, other
than Greiner, they've all had some debt. MK &
Ainsworth have put some new management in place on the
accounting side - possibly in an effort to give some
backbone to the debt repayment priority? Speculation but
it probably has some truth to it. Another risk is
their current accounting systems and the ability of the
accounting systems to facilitate integration. From what I
understand the accounting systems are a bit behind the times
and need a bit of a facelift.
Your comments are overall quite positive. What is
your opinion of MK? What do you think is the biggest
risk for URS going forward? If the trend is positive
and sustainable, then the stock would seem
Is there a competitive threat? ITX? WSTNA?
1. Market: URS needs to figure out what markets
it is going to chase. The transportation market
continues to be the big hitter in the federal budgets and
this is an area of strength. Despite all of the
discussions to the contrary, we in the trenches still make a
good living on the environmental business and some of
us would like to keep working at it. I buy the fact
that the remediation market is moving downwards, esp.
without Superfund reform, but it doesn't really seem to
have an impact on our day-to-day business.
Many of the URSGWC posters don't seem to think much of
the recent defections from the ex-D&M corps. That
said, I think that they are delusional, and that we are
now seeing some of the heavier hitters either
retiring or quitting. Within the past three weeks we have
lost two of the most senior management members of our
Midwest team, two good officers (partner level) in Texas,
and the regional manager in Southern California. Were
they all worthless? What my new colleagues at URS fail
to understand is that these people had relationships
with the industrial clients they represented and will
likely take that business with them. URS has been so
focused on public sector work where this paradigm has no
relevance. In order to lose a contract with say, the City of
St. Louis, you would have to lose your entire project
team, not just a key manager. On the federal side, this
mentality is even worse, as the ACOE and EPA don't really
care who is on the team once the contract is in
3. Other acquisitions: URS is starting to sell small
pieces (look for the news) and they are looking for some
additional strategic purchases. I don't think we'll double
in size (30,000?) but we may see the addition of
2-3,000 people over the next year if MK has his way. I
understand that Montgomery Watson was under consideration
before DMG floated along.
4. Accelerating debt
paydown: Rumor has it that MK got all the top brass
together and told them he wanted a little more $$$ of the
overhead lines. This after what he felt were good 1Q
The firm is just getting its act together. For most,
it's just time to buckle our seatbelts and hold on.
All of the strategy and so forth will come soon
Art Darrow was CEO of D&M at the time of
acquisition. His strategy of making D&M a "billion dollar
company by 2000" effectively ran the company into the
ground. His merry men were all the upper management help
he had. Re: prospects of URS etc. I can't answer, I
left D&M prior to the URS buyout. The stock looks
cheap at this point with a P/E under 10, but the debt
load has to be a concern
Who is Art Darrow? Who are the merry
What do you think are the prospects for URS in its
current form? Stock cheap or not? Debt load bearable, or
not? MK capable, or not? More deals (acquisitions), or
Are these the right questions? If not, what are the
I can answer a few of your questions.
business\industry is definitely in the dumps. The regulators have
backed off - waiting on new administration, clients are
more savvy on pricing - thereby forcing margins down,
and gov't contracts do not generate much profit. Add
this to the never ending mergers and flight of talent
to better paying fields and you have an industry not
poised for huge success.
are limited to stealing clients from other
consultants following inability to provide adequate service.
The D&M acquisistion seems to have allowed Art Darrow
and his merry men to bury thier mistakes in the cat
Well, it sure seems like a bunch of big 9th
graders working at URS and predecessor companies with a
lot to whine about. Separate from all of the
political BS that goes with every corporate merger, does
anyone know what is the state of the business? Industry?
Contract environment? Strategic initiatives?
plans to accelarate debt paydown? What are the trading
levels for the URS junk bonds? Above or below
Will URS ever make another acquisition? Was the D-M
acquisition legit, or was it just intended to be big enough
to cover up problems?
...and seem to have some good views into the west
coast operations of the various companies. FYI- There
are plans floating around to combine offices where it
makes sense. The process is happening very slowly for
some pretty good reasons: subleasing is complicated
and expensive; moving is expensive; and integrating
staff is complicated. I agree that there are some
excessive overhead dollars being spent. On the flip side
though, if you integrate too quickly you're likely to
waste those overhead dollars. Better to integrate ONCE
right that TWICE wrong. IMHO...