2009_URS_AR

Our performance in the power market sector in 2009 reflected
a decline in capital spending by many of our customers and
the winding down and completion of more than a dozen large
air quality control projects to meet a 2010 emissions reduction
deadline. Despite the short-term effects of the economic downturn
and the timing of regulatory mandates, we are confident
in our long-term prospects in this market sector.
There are signs of an emerging growth cycle as our power
clients plan for the next phase of capital investments. These
investments are expected to include major air quality control
projects to meet emissions reduction requirements that
take effect in 2015 and the development of new gas-fired and
nuclear power facilities as the economy recovers and the
demand for electricity rises. With our expertise in the engineering
and construction of virtually every type of power plant, we
expect these trends will generate new opportunities for URS
in 2011 and 2012.
In the past fiscal year, our work in the industrial and commercial
sector was the most affected by the economic downturn.
In response to lower commodity prices and reduced demand
for manufactured goods, many of our customers in the oil
and gas, manufacturing and mining industries cut production
levels and reduced capital spending on the types of programs
that require the engineering and construction services we
provide. At the same time, demand remained steady for our
facility management services as clients continued to outsource
non-core activities to better manage their overhead costs.
URS is not dependent on any
single market, funding source
or commodity price.
With the stabilization of some commodity prices and positive
indicators in certain measures of the economy, we are beginning
to see new opportunities in this market sector. Although we
expect that 2010 will be a transitional year for many of our
industrial and commercial customers, we are confident that,
longer term, growth will resume as the economy recovers.
In summary, we are pleased with the Company’s performance
in 2009, particularly given the difficult economic conditions.
The strength of our federal sector and relative stability of the
infrastructure sector helped to offset short-term weakness in
our power and industrial and commercial businesses.
This year’s Annual Report—Strategy. Execution. Results.—
describes how, through the successful execution of our diversification
strategy, URS delivered strong results in 2009 and
is strategically positioned for future growth in each of our key
markets. It also highlights projects that demonstrate our broad
technical capabilities and global resources, the talent and
ingenuity of our employees, and their expertise performing
the largest and most complex assignments.
The strength of our federal
sector and relative stability
of the infrastructure sector
helped to offset short-term
weakness in our power
and industrial and commercial
businesses.
I should like to thank our stockholders, clients and employees
for their ongoing support and confidence in URS. I also should
like to extend my sincere gratitude to H. Jesse Arnelle, who is
retiring in May after six years of distinguished service as
a member of the URS Board of Directors. Drawing upon his
wealth of experience, gained from an impressive legal career
and service on the boards of other major corporations, Jesse’s
leadership and keen business perspective have been invaluable
to URS as the Company has evolved and grown.
I look forward to updating you on our progress in 2010.
Martin M. Koffel
Chairman and Chief Executive Officer
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