* High-speed rail offers plenty of bidding opportunities
* Low debt means ample room for acquisitions, growth -CFO
* Shares up nearly 11 pct after results, positive outlook
SAN FRANCISCO, Nov 13 Engineering company URS
Corp URS.N sees plenty of opportunities for work next year as
U.S. states seek to build high-speed rail lines with help from
federal funds, and with a few big water projects on the way.
More broadly, $10 billion in federal stimulus money will be
flowing to major infrastructure projects that URS could manage,
compared with just $2 billion this year, the company said.
Last month 24 states applied for stimulus money earmarked
for high-speed rail, and URS is already under contract for
related work in California and Connecticut, the company said.
"We currently are hiring additional engineers to meet
increased demand in this area," Chief Executive Martin Koffel
told analysts on a conference call on Friday to discuss the
company's better-than-expected third quarter earnings
Shares of the San Francisco-based company closed up $4.36,
or 10.8 percent, to $44.85.
URS also has won a stimulus-related contract from U.S. rail
company Amtrak to improve its Northeast corridor, and a joint
venture it leads won a potential $280 million deal for the St.
Bernard levee near New Orleans. Koffel was encouraged by recent
California legislation to improve its water delivery system.
Last month, URS bought oil and gas project specialist
ForeRunner, anticipating a flurry of pipeline building in years
ahead as natural gas becomes a bigger part of the U.S. energy
mix. Rival Quanta Services Inc (PWR.N) gave similar reasons for
its recent purchase of pipeline firm Price Gregory.
URS executives signaled more acquisitions could be on the
way. Chief Financial Officer Tom Hicks said URS would bring in
plenty of cash next year, lowering its leverage well below what
he deems an optimal debt-to-capitalization ratio of 20 percent
to 30 percent. So money would likely be redeployed for
acquisitions or to grow the company internally, he added.
URS, with total capitalization on its balance sheet of more
than $5 billion, now has long-term debt of just over $780
million, down from nearly $1.1 billion at the start of 2009.
"I have no career experience in managing an unleveraged
company," Koffel said, recalling a brief exception to that two
years ago when he was at a New York hotel to meet bankers to
finance its Washington Group takeover.
"For about 10 days we were technically out of debt," he
added. "And I said to the group 'I feel like I've lost an old
(Reporting by Braden Reddall; editing by Carol Bishopric)