1. Quarterly Economic Snapshot Survey Quarterly Economic Snapshot Survey

2. Purpose To take the pulse of the industry on a quarterly basis, determine trends, and become a regular parameter of our industry’s economic conditions Measure business activity in the most recent quarter compared to same quarter last year, as well as sentiment about business conditions in the future for several business segments in the industry Business activity is defined as the changes (“up”, “even”, or “down”) in the dollar value of sales/services sold in major industry segments to applicable markets, during the 1 st quarter of 2015 over the 1 st quarter of 2014 Future business conditions are measured by how the respondents feel (“optimistic”, “neutral”, or “pessimistic”) about their business for three future periods—the upcoming 6 months, coming year and next 2-3 years.

3. Methodology Questionnaire is designed to measure these four indicators of business conditions in five major business segments for both the DoD market and Federal Agency (excluding DoD) market The five business segments include: Architecture, Engineering, Environmental Engineering, Construction and Program & Project Management Results of the survey are displayed for each business segment and market A confidence index is calculated for each question; the index is equal to the percent of positive responses, such as “up” or “optimistic,” plus one half the percent of “even” or “neutral,” converted to a base of 100 A score of 50 or higher suggests expansion, while a score less than 50 indicates contraction Not only will the value of the confidence index be important, the trend of each index will show how business confidence changes over time

4. Survey Sample A total of 963 respondents provided valid survey records, for a response rate of 6.2% and an overall margin of sampling error of plus or minus 3.0% at a 95% confidence level To provide further insight into the business trends and conditions, the data was segmented using some demographic characteristics pertinent to both the company and the individual respondent including: location of the home office, geographic regions in which you do business, size of company in terms of both the number of employees in all locations and gross operating revenue in 2014, and level of responsibility of the person completing the survey

5. Click to edit Master title style Business Segments  A majority (55.3%) of the respondents are involved in the Engineering–DOD Market, and a close second (43.2%) are involved in either Engineering– Federal Agency or Program and Project Management–DOD Market  Almost one-fifth (18.4%) of respondents is involved in Architecture-Federal Agency, while over one-quarter is involved in Architecture–DOD Market or Environmental Engineering–Federal Agency

6. Click to edit Master title styleLocation

7. Geographic Regions in Which You Do Business  Nearly one third of all respondents (31.0%) indicated they do business in All U.S. Regions, and a slightly smaller proportion (27.2%) does business in Region IV (Southeast)  Nearly one-fifth of all respondents (19.3%) does business internationally  A minority of respondents does business in Region I (New England), followed by Region (Northwest/ Arctic)

8. Click to edit Master title style Type of New Employees Planning to Hire Within the Next 6-12 Months  Over seven in 10 respondents indicated they plan to hire full-time equivalent employees within the next 6-12 months, while about one quarter indicated they plan to hire either project specific or part-time employees  All in all, these percentages imply that more companies are expecting business to expand in the next 6-12 months

9. Recent Trends Respondents, in general, were more confident about future business conditions than about recent business trends, and the level of confidence was higher for longer future time horizons The confidence index for recent business trends, for most markets, was in the 50’s, indicating slight business expansion in Q1 2015 compared to Q1 2014 Most respondents indicated business performance was the highest for sustainment restoration and modernization, and the lowest for disaster response, based on the value of the confidence index For example, 39.1% of respondents to the Engineering–DOD Market segment indicated sales were “up” in sustainment restoration and modernization compared to just 16.9% who indicated sales were “down”, producing a confidence index value of 61.1; On the other hand, the confidence index for disaster response was 45.6, indicating business contraction

10. Future Conditions When asked about future business conditions, respondents were most optimistic about business for the next 2-3 years, in all business segments, indicating expectations of business expansion at faster rates 2-3 years down the road than for the upcoming 6 month or the coming year For example, the confidence index for the sustainment restoration and modernization market within the Architecture–Federal Agency segment was 64.3 for the upcoming 6 months and 72.7 for the next 2-3 years, an increase of 8.4 points For ecosystem restoration in the same segment, the index jumped from 45.3 for the upcoming 6 month to 50.0 for the next 2-3 years, indicating respondents expect business conditions to move from contracting to barely expanding over these time intervals.

11. Click to edit Master title style Confidence Index ENGINEERING–DOD MARKET

12. Click to edit Master title style Confidence Index Confidence Index ENGINEERING–DOD MARKET

13. Click to edit Master title style Confidence Index Confidence Index ARCHITECTURE–FEDERAL AGENCY

14. Demographics and Economic Confidence Measures of business trends and confidence varied with demographic factors, especially location and size of the company For those involved in sustainment restoration and modernization within the Engineering– DOD Market segment, the confidence index (for recent changes in sales) was higher for those located in the U.S. than those located internationally Based on company size, business confidence increased, in general, with the number of people employed at all location up to 101-500 employees The confidence index also varied with the company’s 2014 operating revenue, with those with the smallest companies (less than $5 million of revenue) having the highest value (63.7) and those with the largest companies (more than $500 of revenue) having the lowest value (58.3) However, the confidence index was also relatively high for companies with $101.1 million- $500 million (62.7) and companies with $5million-$20 million

15. Click to edit Master title style Demographics and Economic Confidence