AECOM cuts executive salaries 20% as it adapts for COVID-19 market conditions

Los Angeles-based AECOM says it has implemented a  temporary 20% reduction in salaries among the Board of Directors, executive leadership team and other senior leaders as it adapts its business for the COVID-19 pandemic.

The multinational infrastructure business says in a statement it has taken “multiple steps” to safeguard its employees and operations.

“Following the lead of AECOM’s safety and health experts, as well as guidance from government agencies and leading health organizations, the company has implemented comprehensive enterprise resilience plans to include the restriction of all non-essential business travel, enhancement of virtual consultation tools, and the expansion of office and project site safety procedures,” the statement says. “Further, AECOM’s global workforce has seamlessly transitioned to remote working where appropriate, bolstered by key investments in information technology to enable robust remote work environments. For example, nearly 90% of the firm’s design team in the Americas is working remotely.”

AECOM says it has been “selected by key U.S. federal and state government agencies to assist in their responses to the coronavirus crisis, including several substantial design and program management projects to support the construction of emergency triage hospitals on the East Coast.”

AECOM says it has a “strong financial foundation and substantial liquidity position, reflecting the benefit of the cash proceeds from the sale of its Management Services business for aggregate consideration of approximately $2.4 billion, which closed on January 31, 2020.”

“As previously disclosed, on a pro forma basis giving effect to the Management Services sale, as of December 31, 2019, AECOM had cash and equivalents of approximately $1.7 billion, total debt of $2.2 billion and net leverage of approximately 0.5x. In addition, the company has access to a $1.35 billion revolving credit facility,” which AECOM says remains undrawn as of April 3.

“AECOM has conducted a rigorous bottom-up review of the impact of coronavirus at a client, project and office level under multiple scenarios and different durations of virus impacts. As a result of this analysis, the Company has implemented several immediate actions designed to mitigate financial impacts and to ensure business resiliency, including a focus on limiting impacts to employees and keeping teams intact as response moves to recovery. This includes a temporary 20 percent reduction in salaries among the Board of Directors, executive leadership team and other senior leaders.”