CORRECTION – TRC Announces Second-Quarter Fiscal 2016 Financial Results

LOWELL, MA--(Marketwired - Feb 3, 2016) - In the news release, "TRC Announces Second-Quarter Fiscal 2016 Financial Results" issued earlier today by TRC Companies, Inc. (NYSE: TRR), we are advised by the company that the fourth and fifth bullet sentences of the Second-Quarter FY 2016 Vs. Second-Quarter FY 2015 Highlights should read "Net income of $3.9 million; Adjusted net income² up 18% to 4.7 million" and "Diluted EPS of $0.13; Adjusted diluted EPS² up 15% to $0.15." Additionally, the second to last sentence of the second paragraph should read "NSR, adjusted EBITDA, and adjusted net income were up 12%, 13% and 18%, respectively, compared with the same period of fiscal 2015." Please also be advised that the figures to Adjusted net income² and Adjusted diluted earnings per common share² from the Non-GAAP Results table have been updated as well. Complete corrected text follows.

LOWELL, MA -- Feb 3, 2016 - TRC Companies, Inc. (NYSE: TRR)

Second-Quarter FY 2016 Vs. Second-Quarter FY 2015 Highlights

• NSR¹ up 12% to $111.4 million
• Operating income of $6.7 million; Adjusted operating income² up 16% to $7.9 million
• EBITDA of $9.5 million; Adjusted EBITDA² up 13% to $10.7 million
• Net income of $3.9 million; Adjusted net income² up 18% to $4.7 million
• Diluted EPS of $0.13; Adjusted diluted EPS² up 15% to $0.15

TRC Companies, Inc.  (NYSE: TRR), a recognized leader in engineering, environmental consulting and construction-management services to the energy, environmental, infrastructure and pipeline markets, today announced financial results for the fiscal second quarter ended December 25, 2015.

"During our second quarter, we delivered strong financial results on top of the transformative acquisition of Willbros Professional Services (WPS), which closed November 30," said Chris Vincze, Chairman and Chief Executive Officer. "NSR, adjusted EBITDA, and adjusted net income were up 12%, 13% and 18%, respectively, compared with the same period of fiscal 2015. Results for the second quarter of fiscal 2016 included one month of performance from the Willbros acquisition."

		Three Months Ended									Six Months Ended
(In millions, except per share data)		December 25, 2015			December 26, 2014			% Change			December 25, 2015			December 26, 2014			% Change
GAAP Results
Net service revenue(1)		$	111.4		$	99.8		12	%		$	211.5		$	192.5		10	%
Acquisition and integration expense		$	1.2		$	-		N/A			$	2.1		$	-		N/A
Operating income		$	6.7		$	6.9		-2	%		$	14.4		$	12.9		12	%
Net income applicable to TRC Companies, Inc.		$	3.9		$	4.0		-2	%		$	8.4		$	7.5		13	%
Diluted earnings per common share		$	0.13		$	0.13		0	%		$	0.27		$	0.25		8	%
Non-GAAP Results
Adjusted operating income(2)		$	7.9		$	6.9		16	%		$	16.5		$	12.9		28	%
Adjusted net income(2)		$	4.7		$	4.0		18	%		$	9.7		$	7.5		30	%
Adjusted EBITDA(2)		$	10.7		$	9.5		13	%		$	21.5		$	17.8		21	%
Adjusted diluted earnings per common share(2)		$	0.15		$	0.13		15	%		$	0.31		$	0.25		24	%

(1)		TRC believes net service revenue (NSR) best reflects the value of services provided and is the most meaningful indicator of revenue performance.
(2)		Excludes acquisition and integration expenses of $1.2 million and $2.1 million for the three and six months ended December 25, 2015, respectively.

Comments on the Results
"Overall, our business performed well. In particular, demand for electrical transmission and distribution services resulted in an 11% increase in Energy segment NSR, with segment profit up 17% year over year. In addition, transportation-related spending by our municipal and state clients drove a 26% increase in Infrastructure segment NSR, while project execution and cost control drove a 96% increase in segment profit. In our Environmental segment, a slowdown from certain oil and gas clients and the completion of a large pipeline permitting project led to a 2% decline in NSR and a profit decline of 6%. Even so, other service areas within the Environmental segment remain solid," said Vincze.

Business Outlook
"TRC is the national leader in the environmental permitting of pipeline projects. The acquisition of WPS represents the execution of our strategy to establish a premier pipeline and related facilities engineering, consulting and construction management capability. Now two months after closing, we have functionally integrated our two organizations, migrating the new business onto our payroll system, benefits, IT networks and ERP platform, while building the leading full-service pipeline consulting and engineering company in the nation," Vincze added.

"Our strategic growth initiatives are progressing through the first half of fiscal 2016, as demonstrated by our results. Demand for our Energy segment services from our utility clients remains robust. Our Infrastructure segment backlog continues to grow, and the new transportation bill improves the outlook for this segment. Although we expect to see a slowdown from our oil and gas clients, services related to environmental remediation, construction, transaction support, the retirement of coal plants and the need to transport natural gas should contribute to revenue in our Environmental segment going forward. These factors and the need to ensure the integrity of our national pipeline infrastructure also should support our new Pipeline Services segment. We believe the oil and gas market is a good long-term investment, and we have positioned TRC to be a leader in this industry."

Conference Call Information
TRC will webcast its financial results conference call on Thursday, February 4, 2016 at 9 a.m. ET. To listen to the live webcast and access the accompanying presentation slides, visit the "Investor Center" section of TRC's website at www.TRCsolutions.com. The call also may be accessed by dialing (877) 407-5790 or (201) 689-8328. A webcast replay will be available on the Company's website for approximately one year.

About TRC
A pioneer in groundbreaking scientific and engineering developments since the 1960s, TRC is a national engineering, environmental consulting and construction management firm that provides integrated services to the energy, environmental, infrastructure and pipeline services markets. TRC serves a broad range of commercial, industrial and government clients, implementing complex projects from initial concept to delivery and operation. TRC delivers results that enable clients to achieve success in a complex and changing world. For more information and updates from the Company, visit TRC's website at www.TRCsolutions.com and follow TRC on Twitter and StockTwits at @TRC_Companies and on LinkedIn.

Forward-Looking Statements
Certain statements in this press release may be forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. You can identify these statements by forward-looking words such as "may," "expects," "plans," "anticipates," "believes," "estimates," or other words of similar import. You should consider statements that contain these words carefully because they discuss TRC's future expectations, contain projections of the Company's future results of operations or of its financial condition, or state other "forward-looking" information. TRC believes that it is important to communicate its future expectations to its investors. However, there may be events in the future that the Company is not able to accurately predict or control and that may cause its actual results to differ materially from the expectations described in its forward-looking statements. Investors are cautioned that all forward-looking statements involve risks and uncertainties, and actual results may differ materially from those discussed as a result of various factors, including, but not limited to, the uncertainty of TRC's operational and growth strategies; circumstances which could create large cash outflows, such as contract losses, litigation, uncollectible receivables and income tax assessments; regulatory uncertainty; the availability of funding for government projects; the level of demand for TRC's services; product acceptance; industry-wide competitive factors; the ability to continue to attract and retain highly skilled and qualified personnel; the availability and adequacy of insurance; and general political or economic conditions. Furthermore, market trends are subject to changes, which could adversely affect future results. See the risk factors and additional discussion in TRC's Annual Report on Form 10-K for the fiscal year ended June 30, 2015, and other factors included from time to time in the Company's other subsequent filings with the Securities and Exchange Commission.

TRC Companies, Inc.
Condensed Consolidated Statements of Operations
(in thousands, except per share data)
(Unaudited)
			Three Months Ended								Six Months Ended
			December 25,				December 26,				December 25,				December 26,
			2015				2014				2015				2014
Gross revenue			$	157,743			$	143,228			$	293,202			$	266,253
	Less subcontractor costs and other direct reimbursable charges			46,361				43,390				81,657				73,796
Net service revenue				111,382				99,838				211,545				192,457
Interest income from contractual arrangements				27				22				42				44
Insurance recoverables and other income				1,031				641				1,773				5,485
Operating costs and expenses:
	Cost of services (exclusive of costs shown separately below)			93,676				82,599				176,660				163,789
	General and administrative expenses			8,046				8,395				15,167				16,433
	Acquisition and integraton expenses			1,240				-				2,118				-
	Depreciation and amortization			2,780				2,641				5,044				4,906
Total operating costs and expenses				105,742				93,635				198,989				185,128
Operating income				6,698				6,866				14,371				12,858
Interest income				137				-				137				-
Interest expense				(461	)			(21	)			(489	)			(52	)
Income from operations before taxes				6,374				6,845				14,019				12,806
Income tax provision				(2,439	)			(2,848	)			(5,596	)			(5,328	)
Net income				3,935				3,997				8,423				7,478
Net loss applicable to noncontrolling interest				2				5				6				9
Net income applicable to TRC Companies, Inc.			$	3,937			$	4,002			$	8,429			$	7,487
Basic earnings per common share			$	0.13			$	0.13			$	0.27			$	0.25
Diluted earnings per common share			$	0.13			$	0.13			$	0.27			$	0.25
Weighted-average common shares outstanding:
	Basic			30,968				30,329				30,805				30,157
	Diluted			31,369				30,531				31,347				30,458

TRC Companies, Inc.
Condensed Consolidated Balance Sheets
(in thousands, except per share data)
(Unaudited)
			December 25,				June 30,
			2015				2015
ASSETS
Current assets:
	Cash and cash equivalents		$	9,450			$	37,296
	Restricted cash			199				122
	Accounts receivable, less allowance for doubtful accounts			152,608				138,346
	Insurance recoverable - environmental remediation			40,422				40,927
	Restricted investments			6,582				6,701
	Deferred income tax assets			15,414				16,057
	Income taxes refundable			-				412
	Prepaid expenses and other current assets			23,902				10,499
		Total current assets		248,577				250,360
Property and equipment				71,018				64,594
	Less accumulated depreciation and amortization			(48,607	)			(50,885	)
		Property and equipment, net		22,411				13,709
Goodwill				101,697				37,024
Intangible assets, net				51,888				9,304
Long-term deferred income tax assets				2,583				2,867
Long-term restricted investments				17,102				18,385
Long-term prepaid insurance				24,809				25,929
Other assets				23,131				5,303
		Total assets	$	492,198			$	362,881
LIABILITIES AND EQUITY
Current liabilities:
	Current portion of long-term debt		$	22,242			$	50
	Current portion of capital lease obligations			33				166
	Accounts payable			33,202				31,999
	Accrued compensation and benefits			44,858				47,233
	Deferred revenue			16,350				10,612
	Environmental remediation liabilities			8,673				8,695
	Income taxes payable			230				3,271
	Other accrued liabilities			46,243				42,170
		Total current liabilities		171,831				144,196
Non-current liabilities:
	Long-term debt, net of current portion			96,563				55
	Income taxes payable and deferred income tax liabilities			1,863				1,647
	Deferred revenue			63,567				68,579
	Environmental remediation liabilities			450				489
		Total liabilities		334,274				214,966
Commitments and contingencies
Equity:
	Common stock, $.10 par value; 40,000,000 shares authorized, 31,039,895 and 31,036,413 shares issued and outstanding, respectively, at December 25, 2015, and 30,485,510 and 30,482,028 shares issued and outstanding, respectively, at June 30, 2015			3,104				3,049
	Additional paid-in capital			192,847				191,321
	Accumulated deficit			(37,510	)			(45,939	)
	Accumulated other comprehensive loss			(83	)			(88	)
	Treasury stock, at cost			(33	)			(33	)
		Total shareholders' equity applicable to TRC Companies, Inc.		158,325				148,310
	Noncontrolling interest			(401	)			(395	)
		Total equity		157,924				147,915
		Total liabilities and equity	$	492,198			$	362,881