MYR Group Inc. (“MYR”) (NASDAQ: MYRG), a holding
company of leading specialty contractors serving the electric
utility infrastructure, commercial and industrial construction
markets in the United States and Canada, announced today its
first-quarter 2024 financial results.
Highlights for
First Quarter
2024
- Quarterly revenues of $815.6
million
- Quarterly net income of $18.9
million, or $1.12 per diluted share
- Quarterly EBITDA of $39.8
million
- Backlog of $2.43 billion
Management CommentsRick Swartz,
MYR’s President and CEO, said, “Our first quarter 2024 financials
resulted in a slight increase in revenues and consolidated gross
profit compared to the same period of 2023.” Mr. Swartz also said,
“The relatively slow start to the year for MYR Group in the first
quarter of 2024 reflects some of the near-term supply chain and
regulatory challenges a few of our customers are experiencing.
Bidding activity remains healthy across both of our business
segments, demonstrating positive signs for continued long-term
growth. We remain focused on expanding our strong customer
relationships through alliance agreements and strategically
capturing new opportunities which we believe will drive success in
the coming year.”
First Quarter
ResultsMYR reported first-quarter 2024 revenues of $815.6
million, an increase of $4.0 million, or 0.5 percent, compared to
the first quarter of 2023. Specifically, our Transmission and
Distribution (“T&D”) segment reported quarterly revenues of
$490.4 million, an increase of $45.1 million, or 10.1 percent, from
the first quarter of 2023, due to an increase in revenue on
distribution projects and an increase in revenue on transmission
projects. Our Commercial and Industrial (“C&I”) segment
reported quarterly revenues of $325.2 million, a decrease of $41.1
million, or 11.2 percent, from the first quarter of 2023, which was
primarily due to the delayed start of certain projects that are
expected to begin later in 2024.
Consolidated gross profit increased to $86.2
million for the first quarter of 2024, compared to $84.4 million
for the first quarter of 2023. The increase in gross profit was due
to higher revenues and higher margin. Gross margin increased to
10.6 percent for the first quarter of 2024 from 10.4 percent for
the first quarter of 2023. The increase in gross margin was
primarily due to better-than-anticipated productivity, favorable
joint venture results, favorable change orders and a favorable job
closeout. These margin improvements were partially offset by labor
and project inefficiencies, some of which were caused by inclement
weather experienced on certain projects, rising costs associated
with supply chain disruptions, an unfavorable change order and an
unfavorable job closeout. Changes in estimates of gross profit on
certain projects resulted in gross margin decreases of 1.2 percent
and 0.6 percent for the first quarter of 2024 and 2023,
respectively.
Selling, general and administrative expenses
increased to $62.2 million for the first quarter of 2024, compared
to $57.0 million for the first quarter of 2023. The
period-over-period increase was primarily due to an increase in
employee-related expenses, an increase in contingent compensation
expense related to a prior acquisition and an increase in employee
incentive compensation costs.
Interest expense increased to $1.1 million for the
first quarter of 2024, compared to $0.6 million for the first
quarter of 2023. The period-over-period increase was attributable
to higher average outstanding debt balances and higher interest
rates, during the first quarter of 2024 as compared to the first
quarter of 2023.
Income tax expense was $4.2 million for the first
quarter of 2024, with an effective tax rate of 18.0 percent,
compared to income tax expense of $3.9 million for the first
quarter of 2023, with an effective tax rate of 14.4 percent. The
increase in the effective tax rate for the first quarter of 2024
compared to the first quarter of 2023 was primarily due to lower
stock compensation excess tax benefits and higher other permanent
difference items.
For the first quarter of 2024, net income was $18.9
million, or $1.12 per diluted share, compared to $23.2 million, or
$1.38 per diluted share, for the same period of 2023. First-quarter
2024 EBITDA, a non-GAAP financial measure, was $39.8 million,
compared to $41.3 million in the first quarter of 2023.
BacklogAs of March 31, 2024,
MYR's backlog was $2.43 billion, compared to $2.51 billion as of
December 31, 2023. As of March 31, 2024, T&D backlog
was $853.2 million, and C&I backlog was $1.57 billion. Total
backlog at March 31, 2024 decreased $243.0 million, or 9.1
percent, from the $2.67 billion reported at March 31,
2023.
Balance SheetAs of March 31,
2024, MYR had $434.3 million of borrowing availability under its
$490 million revolving credit facility.
Non-GAAP Financial MeasuresTo
supplement MYR’s financial statements presented in accordance with
generally accepted accounting principles in the United States
(“GAAP”), MYR uses certain non-GAAP measures. Reconciliation to the
nearest GAAP measures of all non-GAAP measures included in this
press release can be found at the end of this release. MYR’s
definitions of these non-GAAP measures may differ from similarly
titled measures used by others. These non-GAAP measures should be
considered supplemental to, and not a substitute for, financial
information prepared in accordance with GAAP.
MYR believes that these non-GAAP measures are
useful because they (i) provide both management and investors
meaningful supplemental information regarding financial performance
by excluding certain expenses and benefits that may not be
indicative of recurring core business operating results, (ii)
permit investors to view MYR’s performance using the same tools
that management uses to evaluate MYR’s past performance, reportable
business segments and prospects for future performance, (iii)
publicly disclose results that are relevant to financial covenants
included in MYR’s credit facility and (iv) otherwise provide
supplemental information that may be useful to investors in
evaluating MYR.
Conference CallMYR will host a
conference call to discuss its first-quarter 2024 results on
Thursday, May 2, 2024 at 8:00 a.m. Mountain time. To
participate via telephone and join the call live, please register
in advance here:
https://register.vevent.com/register/BI854acb449c13458fab6e49708f48fcef.
Upon registration, telephone participants will receive a
confirmation email detailing how to join the conference call,
including the dial-in number and a unique passcode. Participants
may access the audio-only webcast of the conference call from the
Investors page of MYR Group’s website at myrgroup.com. A replay of
the webcast will be available for seven days.
About MYR Group Inc. MYR Group is
a holding company of leading, specialty electrical contractors
providing services throughout the United States and Canada through
two business segments: Transmission & Distribution (T&D)
and Commercial & Industrial (C&I). MYR Group subsidiaries
have the experience and expertise to complete electrical
installations of any type and size. Through their T&D segment
they provide services on electric transmission, distribution
networks, substation facilities, clean energy projects and electric
vehicle charging infrastructure. Their comprehensive T&D
services include design, engineering, procurement, construction,
upgrade, maintenance and repair services. T&D customers include
investor-owned utilities, cooperatives, private developers,
government-funded utilities, independent power producers,
independent transmission companies, industrial facility owners and
other contractors. Through their C&I segment, they provide a
broad range of services which include the design, installation,
maintenance and repair of commercial and industrial wiring
generally for airports, hospitals, data centers, hotels, stadiums,
commercial and industrial facilities, clean energy projects,
manufacturing plants, processing facilities, water/waste-water
treatment facilities, mining facilities, intelligent transportation
systems, roadway lighting, signalization and electric vehicle
charging infrastructure. C&I customers include general
contractors, commercial and industrial facility owners, government
agencies and developers. For more information, visit
myrgroup.com.
Forward-Looking StatementsVarious
statements in this announcement, including those that express a
belief, expectation, or intention, as well as those that are not
statements of historical fact, are forward-looking statements. The
forward-looking statements may include projections and estimates
concerning the timing and success of specific projects and our
future production, revenue, income, capital spending, segment
improvements and investments. Forward-looking statements are
generally accompanied by words such as “anticipate,” “believe,”
“estimate,” “expect,” “intend,” “likely,” “may,” “objective,”
“outlook,” “plan,” “project,” “possible,” “potential,” “should,”
“unlikely,” or other words that convey the uncertainty of future
events or outcomes. The forward-looking statements in this
announcement speak only as of the date of this announcement. We
disclaim any obligation to update these statements (unless required
by securities laws), and we caution you not to rely on them unduly.
We have based these forward-looking statements on our current
expectations and assumptions about future events. While our
management considers these expectations and assumptions to be
reasonable, they are inherently subject to significant business,
economic, competitive, regulatory and other risks, contingencies
and uncertainties, most of which are difficult to predict and many
of which are beyond our control. No forward-looking statement can
be guaranteed and actual results may differ materially from those
projected. Forward-looking statements in this announcement should
be evaluated together with the many uncertainties that affect MYR's
business, particularly those mentioned in the risk factors and
cautionary statements in Item 1A. of MYR's Annual Report on Form
10-K for the fiscal year ended December 31, 2023, and in any
risk factors or cautionary statements contained in MYR's subsequent
Quarterly Reports on Form 10-Q or Current Reports on Form 8-K.
MYR Group Inc. Contact:Kelly M.
Huntington, Chief Financial Officer, 847-290-1891,
investorinfo@myrgroup.com
Investor Contact:David Gutierrez,
Dresner Corporate Services, 312-780-7204,
dgutierrez@dresnerco.com
Financial tables follow…
|
MYR GROUP INC.Consolidated Balance
SheetsAs of March 31,
2024 and December 31,
2023 |
|
|
|
|
(in thousands, except share and per share
data) |
March 31,2024 |
|
December 31,2023 |
|
(unaudited) |
|
|
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
3,911 |
|
|
$ |
24,899 |
|
Accounts receivable, net of allowances of $946 and $1,987,
respectively |
|
527,069 |
|
|
|
521,893 |
|
Contract assets, net of allowances of $575 and $610,
respectively |
|
450,741 |
|
|
|
420,616 |
|
Current portion of receivable for insurance claims in excess of
deductibles |
|
8,215 |
|
|
|
8,267 |
|
Refundable income taxes |
|
1,754 |
|
|
|
4,034 |
|
Prepaid expenses and other current assets |
|
34,497 |
|
|
|
46,535 |
|
Total current assets |
|
1,026,187 |
|
|
|
1,026,244 |
|
Property and equipment, net of accumulated depreciation of $383,009
and $380,465, respectively |
|
272,569 |
|
|
|
268,978 |
|
Operating lease right-of-use assets |
|
38,515 |
|
|
|
35,012 |
|
Goodwill |
|
115,865 |
|
|
|
116,953 |
|
Intangible assets, net of accumulated amortization of $31,564 and
$30,534, respectively |
|
81,449 |
|
|
|
83,516 |
|
Receivable for insurance claims in excess of deductibles |
|
33,594 |
|
|
|
33,739 |
|
Investment in joint ventures |
|
9,461 |
|
|
|
8,707 |
|
Other assets |
|
5,850 |
|
|
|
5,597 |
|
Total assets |
$ |
1,583,490 |
|
|
$ |
1,578,746 |
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
Current liabilities: |
|
|
|
Current portion of long-term debt |
$ |
6,617 |
|
|
$ |
7,053 |
|
Current portion of operating lease obligations |
|
9,918 |
|
|
|
9,237 |
|
Current portion of finance lease obligations |
|
1,845 |
|
|
|
2,039 |
|
Accounts payable |
|
321,277 |
|
|
|
359,363 |
|
Contract liabilities |
|
270,964 |
|
|
|
240,411 |
|
Current portion of accrued self-insurance |
|
24,623 |
|
|
|
28,269 |
|
Accrued income taxes |
|
1,185 |
|
|
|
237 |
|
Other current liabilities |
|
95,929 |
|
|
|
100,593 |
|
Total current liabilities |
|
732,358 |
|
|
|
747,202 |
|
Deferred income tax liabilities |
|
47,829 |
|
|
|
48,230 |
|
Long-term debt |
|
31,315 |
|
|
|
29,188 |
|
Accrued self-insurance |
|
51,007 |
|
|
|
51,796 |
|
Operating lease obligations, net of current maturities |
|
28,592 |
|
|
|
25,775 |
|
Finance lease obligations, net of current maturities |
|
184 |
|
|
|
314 |
|
Other liabilities |
|
28,485 |
|
|
|
25,039 |
|
Total liabilities |
|
919,770 |
|
|
|
927,544 |
|
Commitments and contingencies |
|
|
|
Shareholders’ equity: |
|
|
|
Preferred stock—$0.01 par value per share; 4,000,000 authorized
shares; none issued and outstanding at March 31, 2024 and
December 31, 2023 |
|
— |
|
|
|
— |
|
Common stock—$0.01 par value per share; 100,000,000 authorized
shares; 16,761,942 and 16,684,492 shares issued and outstanding at
March 31, 2024 and December 31, 2023, respectively |
|
167 |
|
|
|
167 |
|
Additional paid-in capital |
|
158,791 |
|
|
|
162,386 |
|
Accumulated other comprehensive loss |
|
(6,352 |
) |
|
|
(3,880 |
) |
Retained earnings |
|
511,114 |
|
|
|
492,529 |
|
Total shareholders’ equity |
|
663,720 |
|
|
|
651,202 |
|
Total liabilities and shareholders’ equity |
$ |
1,583,490 |
|
|
$ |
1,578,746 |
|
|
|
|
|
|
|
|
|
|
MYR GROUP INC.Unaudited Consolidated
Statements of
OperationsThree Months
Ended March 31,
2024 and 2023 |
|
|
|
Three months endedMarch 31, |
(in thousands, except per share data) |
2024 |
|
2023 |
Contract revenues |
$ |
815,562 |
|
|
$ |
811,616 |
|
Contract costs |
|
729,319 |
|
|
|
727,224 |
|
Gross profit |
|
86,243 |
|
|
|
84,392 |
|
Selling, general and administrative expenses |
|
62,233 |
|
|
|
56,964 |
|
Amortization of intangible assets |
|
1,228 |
|
|
|
1,226 |
|
Gain on sale of property and equipment |
|
(1,489 |
) |
|
|
(1,224 |
) |
Income from operations |
|
24,271 |
|
|
|
27,426 |
|
Other income (expense): |
|
|
|
Interest income |
|
142 |
|
|
|
321 |
|
Interest expense |
|
(1,054 |
) |
|
|
(586 |
) |
Other expense, net |
|
(263 |
) |
|
|
(90 |
) |
Income before provision for income taxes |
|
23,096 |
|
|
|
27,071 |
|
Income tax expense |
|
4,157 |
|
|
|
3,908 |
|
Net income |
$ |
18,939 |
|
|
$ |
23,163 |
|
Income per common share: |
|
|
|
—Basic |
$ |
1.13 |
|
|
$ |
1.39 |
|
—Diluted |
$ |
1.12 |
|
|
$ |
1.38 |
|
Weighted average number of common shares and potential common
shares outstanding: |
|
|
|
—Basic |
|
16,711 |
|
|
|
16,618 |
|
—Diluted |
|
16,837 |
|
|
|
16,824 |
|
|
|
|
|
|
|
|
|
|
MYR GROUP INC.Unaudited Consolidated
Statements of Cash FlowsThree Months
Ended March 31,
2024 and 2023 |
|
|
|
Three months endedMarch 31, |
(in thousands) |
2024 |
|
2023 |
Cash flows from operating activities: |
|
|
|
Net income |
$ |
18,939 |
|
|
$ |
23,163 |
|
Adjustments to reconcile net income to net cash flows provided by
operating activities: |
|
|
|
Depreciation and amortization of property and equipment |
|
14,602 |
|
|
|
12,763 |
|
Amortization of intangible assets |
|
1,228 |
|
|
|
1,226 |
|
Stock-based compensation expense |
|
1,917 |
|
|
|
1,982 |
|
Gain on sale of property and equipment |
|
(1,489 |
) |
|
|
(1,224 |
) |
Other non-cash items |
|
656 |
|
|
|
62 |
|
Changes in operating assets and liabilities: |
|
|
|
Accounts receivable, net |
|
(6,009 |
) |
|
|
53,819 |
|
Contract assets, net |
|
(30,962 |
) |
|
|
(31,868 |
) |
Receivable for insurance claims in excess of deductibles |
|
197 |
|
|
|
(601 |
) |
Other assets |
|
13,409 |
|
|
|
15,921 |
|
Accounts payable |
|
(30,990 |
) |
|
|
(19,142 |
) |
Contract liabilities |
|
30,758 |
|
|
|
(6,312 |
) |
Accrued self-insurance |
|
(4,426 |
) |
|
|
(2,561 |
) |
Other liabilities |
|
(140 |
) |
|
|
(10,070 |
) |
Net cash flows provided by operating activities |
|
7,690 |
|
|
|
37,158 |
|
Cash flows from investing activities: |
|
|
|
Proceeds from sale of property and equipment |
|
1,879 |
|
|
|
1,539 |
|
Purchases of property and equipment |
|
(25,783 |
) |
|
|
(19,615 |
) |
Net cash flows used in investing activities |
|
(23,904 |
) |
|
|
(18,076 |
) |
Cash flows from financing activities: |
|
|
|
Borrowings under revolving lines of credit |
|
121,745 |
|
|
|
9,242 |
|
Repayments under revolving lines of credit |
|
(117,463 |
) |
|
|
(22,157 |
) |
Payment of principal obligations under equipment notes |
|
(2,591 |
) |
|
|
(1,980 |
) |
Payment of principal obligations under finance leases |
|
(275 |
) |
|
|
(302 |
) |
Proceeds from exercise of stock options |
|
— |
|
|
|
20 |
|
Payments related to tax withholding for stock-based
compensation |
|
(5,866 |
) |
|
|
(7,936 |
) |
Net cash flows used in financing activities |
|
(4,450 |
) |
|
|
(23,113 |
) |
Effect of exchange rate changes on cash |
|
(324 |
) |
|
|
30 |
|
Net decrease in cash and cash equivalents |
|
(20,988 |
) |
|
|
(4,001 |
) |
Cash and cash equivalents: |
|
|
|
Beginning of period |
|
24,899 |
|
|
|
51,040 |
|
End of period |
$ |
3,911 |
|
|
$ |
47,039 |
|
|
|
|
|
|
|
|
|
|
MYR GROUP INC.Unaudited Consolidated
Selected Data,Unaudited Performance Measure and
Reconciliation of Non-GAAP MeasureFor the Three
and Twelve Months Ended March 31,
2024 and 2023 andAs
of March 31,
2024, December 31,
2023, March 31,
2023 and March 31,
2022 |
|
|
|
|
|
|
Three months endedMarch 31, |
|
Last twelve months endedMarch
31, |
|
(dollars in thousands,
except share and per share data) |
2024 |
|
2023 |
|
2024 |
|
2023 |
|
Summary Statement of Operations Data: |
|
|
|
|
|
|
|
|
Contract revenues |
$ |
815,562 |
|
|
$ |
811,616 |
|
|
$ |
3,647,851 |
|
|
$ |
3,183,534 |
|
|
Gross profit |
$ |
86,243 |
|
|
$ |
84,392 |
|
|
$ |
366,248 |
|
|
$ |
347,869 |
|
|
Income from operations |
$ |
24,271 |
|
|
$ |
27,426 |
|
|
$ |
125,938 |
|
|
$ |
117,431 |
|
|
Income before provision for income taxes |
$ |
23,096 |
|
|
$ |
27,071 |
|
|
$ |
121,029 |
|
|
$ |
116,831 |
|
|
Income tax expense |
$ |
4,157 |
|
|
$ |
3,908 |
|
|
$ |
34,263 |
|
|
$ |
30,975 |
|
|
Net income |
$ |
18,939 |
|
|
$ |
23,163 |
|
|
$ |
86,766 |
|
|
$ |
85,856 |
|
|
Tax rate |
|
18.0 |
% |
|
|
14.4 |
% |
|
|
28.3 |
% |
|
|
26.5 |
% |
|
|
|
|
|
|
|
|
|
|
Per Share Data: |
|
|
|
|
|
|
|
|
Income per common
share: |
|
|
|
|
|
|
|
|
—Basic |
$ |
1.13 |
|
|
$ |
1.39 |
|
|
$ |
5.19 |
|
(1) |
$ |
5.15 |
|
(1) |
—Diluted |
$ |
1.12 |
|
|
$ |
1.38 |
|
|
$ |
5.16 |
|
(1) |
$ |
5.08 |
|
(1) |
Weighted average
number of common shares and potential common shares
outstanding: |
|
|
|
|
|
|
|
|
—Basic |
|
16,711 |
|
|
|
16,618 |
|
|
|
16,706 |
|
(2) |
|
16,687 |
|
(2) |
—Diluted |
|
16,837 |
|
|
|
16,824 |
|
|
|
16,828 |
|
(2) |
|
16,884 |
|
(2) |
(in thousands) |
March 31,2024 |
|
December 31,2023 |
|
March 31,2023 |
|
March 31,2022 |
Summary Balance Sheet Data: |
|
|
|
|
|
|
|
Total assets |
$ |
1,583,490 |
|
|
$ |
1,578,746 |
|
|
$ |
1,360,237 |
|
|
$ |
1,205,579 |
|
Total shareholders’ equity |
$ |
663,720 |
|
|
$ |
651,202 |
|
|
$ |
577,565 |
|
|
$ |
536,278 |
|
Goodwill and intangible assets |
$ |
197,314 |
|
|
$ |
200,469 |
|
|
$ |
202,299 |
|
|
$ |
213,510 |
|
Total funded debt (3) |
$ |
37,932 |
|
|
$ |
36,241 |
|
|
$ |
25,658 |
|
|
$ |
49,696 |
|
|
Three months endedMarch 31, |
(dollars in thousands) |
2024 |
|
2023 |
Segment Results: |
Amount |
|
Percent |
|
Amount |
|
Percent |
Contract revenues: |
|
|
|
|
|
|
|
Transmission & Distribution |
$ |
490,395 |
|
|
60.1 |
% |
|
$ |
445,324 |
|
|
54.9 |
% |
Commercial & Industrial |
|
325,167 |
|
|
39.9 |
|
|
|
366,292 |
|
|
45.1 |
|
Total |
$ |
815,562 |
|
|
100.0 |
% |
|
$ |
811,616 |
|
|
100.0 |
% |
Operating income (loss): |
|
|
|
|
|
|
|
Transmission & Distribution |
$ |
29,837 |
|
|
6.1 |
% |
|
$ |
32,821 |
|
|
7.4 |
% |
Commercial & Industrial |
|
11,423 |
|
|
3.5 |
|
|
|
10,627 |
|
|
2.9 |
|
Total |
|
41,260 |
|
|
5.1 |
|
|
|
43,448 |
|
|
5.4 |
|
Corporate |
|
(16,989 |
) |
|
(2.1 |
) |
|
|
(16,022 |
) |
|
(2.0 |
) |
Consolidated |
$ |
24,271 |
|
|
3.0 |
% |
|
$ |
27,426 |
|
|
3.4 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See notes at the end of this earnings release
|
MYR GROUP INC.Unaudited Performance
Measures and Reconciliation of Non-GAAP
MeasuresThree and Twelve Months
Ended March 31,
2024 and 2023 |
|
|
|
|
|
Three months endedMarch 31, |
|
Last twelve months endedMarch
31, |
(in thousands, except
share, per share data, ratios and percentages) |
2024 |
|
2023 |
|
2024 |
|
2023 |
|
|
|
|
|
|
|
|
Financial Performance Measures (4): |
|
|
|
|
|
|
|
EBITDA (5) |
$ |
39,838 |
|
|
$ |
41,325 |
|
|
$ |
186,706 |
|
|
$ |
177,517 |
|
EBITDA per Diluted Share (6) |
$ |
2.37 |
|
|
$ |
2.46 |
|
|
$ |
11.10 |
|
|
$ |
10.51 |
|
EBIA, net of taxes (7) |
$ |
20,694 |
|
|
$ |
24,439 |
|
|
$ |
93,654 |
|
|
$ |
93,696 |
|
Free Cash Flow (8) |
$ |
(18,093 |
) |
|
$ |
17,543 |
|
|
$ |
(49,356 |
) |
|
$ |
100,541 |
|
Book Value per Period End Share (9) |
$ |
39.30 |
|
|
$ |
34.17 |
|
|
|
|
|
Tangible Book Value (10) |
$ |
466,406 |
|
|
$ |
375,266 |
|
|
|
|
|
Tangible Book Value per Period End Share (11) |
$ |
27.62 |
|
|
$ |
22.20 |
|
|
|
|
|
Funded Debt to Equity Ratio (12) |
|
0.06 |
|
|
|
0.04 |
|
|
|
|
|
Asset Turnover (13) |
|
|
|
|
|
2.68 |
|
|
|
2.64 |
|
Return on Assets (14) |
|
|
|
|
|
6.4 |
% |
|
|
7.1 |
% |
Return on Equity (15) |
|
|
|
|
|
15.0 |
% |
|
|
16.0 |
% |
Return on Invested Capital (16) |
|
|
|
|
|
14.9 |
% |
|
|
16.7 |
% |
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP Measures: |
|
|
|
|
|
|
|
Reconciliation of Net Income to EBITDA: |
|
|
|
|
|
|
|
Net income |
$ |
18,939 |
|
|
$ |
23,163 |
|
|
$ |
86,766 |
|
|
$ |
85,856 |
|
Interest expense, net |
|
912 |
|
|
|
265 |
|
|
|
4,698 |
|
|
|
3,198 |
|
Income tax expense |
|
4,157 |
|
|
|
3,908 |
|
|
|
34,263 |
|
|
|
30,975 |
|
Depreciation and amortization |
|
15,830 |
|
|
|
13,989 |
|
|
|
60,979 |
|
|
|
57,488 |
|
EBITDA (5) |
$ |
39,838 |
|
|
$ |
41,325 |
|
|
$ |
186,706 |
|
|
$ |
177,517 |
|
|
|
|
|
|
|
|
|
Reconciliation of Net Income per Diluted Share to EBITDA
per Diluted Share: |
|
|
|
|
|
|
|
Net income per share |
$ |
1.12 |
|
|
$ |
1.38 |
|
|
$ |
5.16 |
|
|
$ |
5.09 |
|
Interest expense, net, per share |
|
0.06 |
|
|
|
0.02 |
|
|
|
0.28 |
|
|
|
0.19 |
|
Income tax expense per share |
|
0.25 |
|
|
|
0.23 |
|
|
|
2.04 |
|
|
|
1.83 |
|
Depreciation and amortization per share |
|
0.94 |
|
|
|
0.83 |
|
|
|
3.62 |
|
|
|
3.40 |
|
EBITDA per Diluted Share (6) |
$ |
2.37 |
|
|
$ |
2.46 |
|
|
$ |
11.10 |
|
|
$ |
10.51 |
|
|
|
|
|
|
|
|
|
Reconciliation of Non-GAAP measure: |
|
|
|
|
|
|
|
Net income |
$ |
18,939 |
|
|
$ |
23,163 |
|
|
$ |
86,766 |
|
|
$ |
85,856 |
|
Interest expense, net |
|
912 |
|
|
|
265 |
|
|
|
4,698 |
|
|
|
3,198 |
|
Amortization of intangible assets |
|
1,228 |
|
|
|
1,226 |
|
|
|
4,909 |
|
|
|
7,468 |
|
Tax impact of interest and amortization of intangible assets |
|
(385 |
) |
|
|
(215 |
) |
|
|
(2,719 |
) |
|
|
(2,826 |
) |
EBIA, net of taxes (7) |
$ |
20,694 |
|
|
$ |
24,439 |
|
|
$ |
93,654 |
|
|
$ |
93,696 |
|
|
|
|
|
|
|
|
|
Calculation of Free Cash Flow: |
|
|
|
|
|
|
|
Net cash flow from operating activities |
$ |
7,690 |
|
|
$ |
37,158 |
|
|
$ |
41,548 |
|
|
$ |
183,175 |
|
Less: cash used in purchasing property and equipment |
|
(25,783 |
) |
|
|
(19,615 |
) |
|
|
(90,904 |
) |
|
|
(82,634 |
) |
Free Cash Flow (8) |
$ |
(18,093 |
) |
|
$ |
17,543 |
|
|
$ |
(49,356 |
) |
|
$ |
100,541 |
|
|
|
|
|
|
|
|
|
See notes at the end of this earnings
release.
|
MYR GROUP INC.Unaudited Performance
Measures and Reconciliation of Non-GAAP MeasuresAs
of March 31,
2024, 2023 and 2022 |
|
|
|
|
(in thousands, except per share amounts) |
March 31, 2024 |
|
March 31, 2023 |
Reconciliation of Book Value to Tangible Book
Value: |
|
|
|
Book value (total shareholders' equity) |
$ |
663,720 |
|
|
$ |
577,565 |
|
Goodwill and intangible assets |
|
(197,314 |
) |
|
|
(202,299 |
) |
Tangible Book Value (10) |
$ |
466,406 |
|
|
$ |
375,266 |
|
|
|
|
|
Reconciliation of Book Value per Period End Share to
Tangible Book Value per Period End Share: |
|
|
|
Book value per period end share |
$ |
39.30 |
|
|
$ |
34.17 |
|
Goodwill and intangible assets per period end share |
|
(11.68 |
) |
|
|
(11.97 |
) |
Tangible Book Value per Period End Share (11) |
$ |
27.62 |
|
|
$ |
22.20 |
|
|
|
|
|
Calculation of Period End Shares: |
|
|
|
Shares outstanding |
|
16,762 |
|
|
|
16,699 |
|
Plus: common equivalents |
|
126 |
|
|
|
206 |
|
Period End Shares (17) |
|
16,888 |
|
|
|
16,905 |
|
(in thousands) |
March 31, 2024 |
|
March 31, 2023 |
|
March 31, 2022 |
Reconciliation of Invested Capital to Shareholders
Equity: |
|
|
|
|
|
Book value (total shareholders' equity) |
$ |
663,720 |
|
|
$ |
577,565 |
|
|
$ |
536,278 |
|
Plus: total funded debt |
|
37,932 |
|
|
|
25,658 |
|
|
|
49,696 |
|
Less: cash and cash equivalents |
|
(3,911 |
) |
|
|
(47,039 |
) |
|
|
(18,732 |
) |
Invested Capital |
$ |
697,741 |
|
|
$ |
556,184 |
|
|
$ |
567,242 |
|
Average Invested Capital (18) |
$ |
626,963 |
|
|
$ |
561,713 |
|
|
|
|
|
|
|
|
|
|
|
|
|
See notes at the end of this earnings
release.
(1) |
|
Last-twelve-months earnings per share is the sum of earnings per
share reported in the last four quarters. |
(2) |
|
Last-twelve-months weighted average basic and diluted shares were
determined by adding the weighted average shares reported for the
last four quarters and dividing by four. |
(3) |
|
Funded debt includes outstanding borrowings under our revolving
credit facility and our outstanding equipment notes. |
(4) |
|
These financial performance measures are provided as supplemental
information to the financial statements. These measures are used by
management to evaluate our past performance, our prospects for
future performance and our ability to comply with certain material
covenants as defined within our credit agreement, and to compare
our results with those of our peers. In addition, we believe that
certain of the measures, such as book value, tangible book value,
free cash flow, asset turnover, return on equity, and debt leverage
are measures that are monitored by sureties, lenders, lessors,
suppliers and certain investors. Our calculation of each measure is
described in the following notes; our calculation may not be the
same as the calculations made by other companies. |
(5) |
|
EBITDA is defined as earnings before interest, taxes, depreciation
and amortization. EBITDA is not recognized under GAAP and does
not purport to be an alternative to net income as a measure of
operating performance or to net cash flows provided by operating
activities as a measure of liquidity. Certain material covenants
contained within our credit agreement are based on EBITDA with
certain additional adjustments, including our interest coverage
ratio and leverage ratio, which we must comply with to avoid
potential immediate repayment of amounts borrowed or additional
fees to seek relief from our lenders. In addition, management
considers EBITDA a useful measure because it provides MYR Group
Inc. and its investors with an additional tool to compare our
operating performance on a consistent basis by removing the impact
of certain items that management believes to not directly reflect
the company’s core operations. Management further believes
that EBITDA is useful to investors and other external users of our
financial statements in evaluating the company’s operating
performance and cash flow because EBITDA is widely used by
investors to measure a company’s operating performance without
regard to items such as interest expense, taxes, depreciation and
amortization, which can vary substantially from company to company
depending upon accounting methods and book value of assets, useful
lives placed on assets, capital structure and the method by which
assets were acquired. |
(6) |
|
EBITDA per diluted share is calculated by dividing EBITDA by the
weighted average number of diluted shares outstanding for the
period. EBITDA per diluted share is not recognized under GAAP and
does not purport to be an alternative to income per diluted
share. |
(7) |
|
EBIA, net of taxes is defined as net income plus net interest plus
amortization of intangible assets, less the tax impact of net
interest and amortization of intangible assets. The tax impact of
net interest and amortization of intangible assets is computed by
multiplying net interest and amortization of intangible assets by
the effective tax rate. Management uses EBIA, net of taxes, to
measure our results exclusive of the impact of financing and
amortization of intangible assets costs. |
(8) |
|
Free cash flow, which is defined as cash flow provided by operating
activities minus cash flow used in purchasing property and
equipment, is not recognized under GAAP and does not purport to be
an alternative to net income, cash flow from operations or the
change in cash on the balance sheet. Management views free cash
flow as a measure of operational performance, liquidity and
financial health. |
(9) |
|
Book value per period end share is calculated by dividing total
shareholders’ equity at the end of the period by the period end
shares outstanding. |
(10) |
|
Tangible book value is calculated by subtracting goodwill and
intangible assets outstanding at the end of the period from
shareholders’ equity. Tangible book value is not recognized under
GAAP and does not purport to be an alternative to book value or
shareholders’ equity. |
(11) |
|
Tangible book value per period end share is calculated by dividing
tangible book value at the end of the period by the period end
number of shares outstanding. Tangible book value per period end
share is not recognized under GAAP and does not purport to be an
alternative to income per diluted share. |
(12) |
|
The funded debt to equity ratio is calculated by dividing total
funded debt at the end of the period by total shareholders’ equity
at the end of the period. |
(13) |
|
Asset turnover is calculated by dividing the current period revenue
by total assets at the beginning of the period. |
(14) |
|
Return on assets is calculated by dividing net income for the
period by total assets at the beginning of the period. |
(15) |
|
Return on equity is calculated by dividing net income for the
period by total shareholders’ equity at the beginning of the
period. |
(16) |
|
Return on invested capital is calculated by dividing EBIA, net of
taxes, less any dividends, by average invested capital. Return on
invested capital is not recognized under GAAP, and is a key metric
used by management to determine our executive compensation. |
(17) |
|
Period end shares is calculated by adding average common stock
equivalents for the quarter to the period end balance of common
stock outstanding. Period end shares is not recognized under GAAP
and does not purport to be an alternative to diluted shares.
Management views period end shares as a better measure of shares
outstanding as of the end of the period. |
(18) |
|
Average invested capital is calculated by adding net funded debt
(total funded debt less cash and marketable securities) to total
shareholders’ equity and calculating the average of the beginning
and ending of each period. |
|
|
|
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