CH2M HILL's name may be a little tricky, but the engineering and construction firm is all up front. The company (named for its founders Cornell, Howland, Hayes, and Merryfield) is organized into three divisions: government, environment, and nuclear; facilities and infrastructure; and energy and water. Federal projects typically include nuclear and environmental cleanup and government facility operations. CH2M HILL also works for state and local governments building water and wastewater systems, airports, highways, and other transportation projects. Its energy and water division targets private sector clients, utilities and local and state governments. Founded in 1946, the company is owned by its employees.
CH2M HILL provides its services to domestic and international clients in the government, oil and gas, metals and mining, manufacturing, pharmaceuticals, and biotech sectors. While the company serves an array of clients, the US federal government is its largest customer. US federal contracts account for 35% of revenues. CH2M Hill makes most of its money (some 65% of revenues) within its government, environment, and nuclear and facilities and infrastructure segments.
CH2M HILL saw an overall increase in revenues in 2011 thanks to improvements in the energy and water and facilities and infrastructure segments. However, as the recovery in the US slowed, some sectors were not as profitable. There was a decrease in the company's nuclear and government facilities and infrastructure business after many projects funded by the American Recovery and Reinvestment Act-funded were concluded. Other government-funded projects were delayed during the Congressional budget conflict that year. CH2M HILL did see improved results in its environmental services business thanks work for the Environmental Protection Agency.
Transportation remains a growing segment in the public sector and the company has focused its resources there. In 2011 CH2M HILL expanded its public transit business when it acquired the state and local government transit consulting business of Booz Allen Hamilton.
Maintaining geographic and service diversity also is key for the company in order for it to withstand dips in demand. Later in 2011 the company acquired Halcrow Group, a London-based specialist in environmental, infrastructure and transport projects for an estimated $192 million. The deal helped boost CH2M HILL's facilities and infrastructure revenues for 2011 (up by 12%). It also expanded the company's global reach, adding Halcrow's extensive client list and about 100 offices worldwide.
CH2M Hill attempted to diversify itself through the acquisition of the UK-based Scott Wilson in 2011. However CH2M Hill lost a bidding war to URS, which bought Scott Wilson for $356 million.
The company has operations in more than 80 countries. CH2M HILL's overseas growth has helped offset decreases in US projects due to the negative economic conditions at home.Growth in its international markets, including Australia and the United Arab Emirates (where it has worked on water desalination plants), has had a hand in spurring increased revenues in its civil infrastructure group.
CH2M HILL has won several notable contracts in recent years. On the federal front CH2M HILL was awarded a $5.5 million contract from the Department of Energy in 2008 to help 25 American cities accelerate the adoption of solar energy. The company is working with city and government officials to help install clean solar energy technology by 2015.
CH2M HILL, along with partners Laing O'Rourke and Mace Ltd., won a coveted $190 million contract to oversee construction on sports venues and infrastructures for the 2012 Olympic Games in London. Among CH2M HILL's responsibilities will be to make the 2012 Games the most environmentally friendly in history by using recycled construction materials, incorporating wind energy, and reducing carbon dioxide emissions.
The company also expects to see continued growth in its industrial segment, partially due to key acquisitions of two energy services companies; troubled Alaskan oil and gas services firm VECO and Colorado pipeline contractor Trigon EPC. The industrial segment also is being driven by several engineering, procurement, and construction contracts with major US utility companies to build power generation facilities.