ConDig (09-Aug-17). Profit at global engineering firm Jacobs Engineering Group Inc, which recently acquired rival CH2M Hill Cos Ltd in a $3.27 billion cash-and-stock deal, rose 29% in its fiscal third quarter as lower restructuring costs and improved margins offset a dip in revenue.

The Dallas, Texas-based company booked net income of $89 million in the quarter ended June 30 compared with $69.1 million in the same period last year.

It comes as Jacobs reported that net earnings during the quarter included about $6.3 million in after-tax restructuring and other charges compared with about $25.8 million a year earlier.

Gross margin was up over 150 basis points compared with the prior year to 18.3%, driven by strong project execution and increased focus on more profitable business, Jacobs reported.

This trimming back in restructuring charges and improved margins helped offset a drop in revenue to $2.5 billion from $2.7 billion a year ago.

Jacobs said its project backlog was $18.6 billion – up $100 million on the prior quarter and over $200 million a year ago, which is the highest professional services backlog in nine quarters.

Jacobs Engineering expects full-year earnings in the range of $3 to $3.15 per share.

“The growth in our backlog and continued margin strength across all lines of business positions us to deliver on our goal to improve growth momentum into FY18. Expectations of our underlying operating performance for the upcoming fourth quarter remain positive and in line with current expectations,” said Jacobs chief finance officer Kevin Berryman.

The group’s buildings and infrastructure division posted revenue of $647 million and operating profit of $56.1 million. This was up on revenue of $553.5 million and operating profit of $50.1 million a year earlier.

Earlier this month, Jacobs announced that it is set to acquire rival CH2M Hill Cos Ltd in a $3.27 billion cash-and-stock deal aimed at expanding its presence in the government services and infrastructure sectors.