Tetra Tech, Inc. (TTEK) recently announced that it has secured an indefinite delivery/indefinite quantity contract worth $489 million from the U.S. Army Chemical Materials Agency (CMA) and is a part of Integration Support V (PAIS V) contract.
As per the contract, the company will be providing program management and technical support to the CMA and the Assembled Chemical Weapons Alternatives program at facilities across the U.S for the next five years.
Tetra Tech will also support a variety of program management, integration and technical services support for aiding efficient destruction of chemical warfare and related material. This support comprises environmental studies, design, monitoring, operations and maintenance, quality assurance, safety and logistics support services.
Simultaneously, the PAIS V contract activities enable the U.S. Army to fulfill the international chemical weapons conventions and move toward disintegration of chemical agent disposal facilities and stockpile storage areas.
Apart from this, Tetra Tech will also be helping CMA in managing its non-stockpile chemical material program and chemical stockpile emergency preparedness program.
In addition, Tetra Tech recently received a contract for the excavation and construction activities related to the environmental decontamination of Vietnam’s Da Nang Airport, affected by dioxin pollution. This contamination was the result of the use of chemical herbicides and defoliant during the Vietnam War
As per the terms of the contract with the U.S. Agency for International Development (USAID), Tetra Tech will be supporting the first U.S.-funded (in coordination with the Government of Vietnam) decontamination program.
Under the contract terms, the company will support the construction of access roadways, build a thermal desorption pile containment structure, excavate and dewater dioxin-contaminated soils and sediments and place them into the pile containment structure for treatment, thereby by providing remediation measures to the affected site.
Both these contracts will benefit the company’s backlog, which stood at $2.06 billion in the recently reported third quarter. In addition, the company has also raised its earnings guidance for fiscal 2012, based on rising demand for its services across the globe.
Tetra Tech Inc. is a leading provider of consulting, engineering, program management, construction and technical services focusing on resource management and infrastructure. It serves its clients by providing cost-effective and innovative solutions to fundamental needs for water, environmental and alternative energy services.
We currently maintain our Neutral recommendation on Tetra Tech Inc. The stock also carries a Zacks #3 Rank, implying a Hold rating over the next one-to-three months.
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