Dycom Industries, Inc. · NYSE:DY
Dycom Industries — 2013 Credit Suisse Engineering & Construction Conference
35 slides from Dycom Industries's conference presentation, Jun 6, 2013
Slide 1: 2013 Credit Suisse Engineering & Construction Conference
2013 Credit Suisse Engineering & Construction Conference June 6, 2013 Exhibit 99.1
Slide 2: Forward-Looking Statements
2 Forward-Looking Statements Fiscal 2013 year to date and interim results are unaudited. This presentation contains “forward-looking statements” which are statements relating to future events, future financial performance, strategies, expectations, and the competitive environment. All statements, ot
Slide 3: Positioned for strong equity returns
3 Positioned for strong equity returns A leading supplier of specialty contracting services to telecommunication providers nationwide Telecommunications networks fundamental to economic progress Firm end market opportunities Wireless network upgrades FTTx deployments Wireless backhaul
Slide 4: Nationwide Footprint and Significant Resources
4 Nationwide Footprint and Significant Resources Note: See “Regulation G Disclosure” slides for a reconciliation of GAAP to Non-GAAP financial measures. Headquartered in Palm Beach Gardens, Florida Nationwide footprint Operates in 49 states and in Canada Over 40 operating subsidiaries and hu
Slide 5: Services Crucial to Customer Success
5 Services Crucial to Customer Success Engineering Underground Facility Locating Outside Plant & Equipment Installation Premise Equipment Installation Wireless Services
Slide 6: Intensely Focused on Telecommunications Market
6 88.0% 7.3%4.7% Intensely Focused on Telecommunications Market Contract Revenue $437.4 million Quarter Ended April 27, 2013 Telecommunications Underground Facility Locating Electric and Gas Utilities and Other Construction and Maintenance
Slide 7: Strong Secular Trend
7 Strong Secular Trend Quar terl y G D P C hang e U .S . In terne t Pro to c ol T ra ffic (Pe tab yte s per M on th ) Sources: U.S. Telecom, The Broadband Association Cisco Visual Networking Index U.S. National Bureau of Economic Analysis “…what we've seen today is 13 billion devices connected. Proj
Slide 8: Key Driver: Wireless Network Upgrades
8 - 50,000 100,000 150,000 200,000 250,000 300,000 350,000 US cell sites US Towers Key Driver: Wireless Network Upgrades “…Project VIP, as you know, is a major initiative for us we announced last November. It says that by year-end 2014 we will expand to cover LTE to more than 300 million POPs in the
Slide 9: Key Driver: FTTx Deployments
9 0 1,000,000 2,000,000 3,000,000 4,000,000 5,000,000 1Q 08 3Q 08 1Q 09 3Q 09 1Q 10 3Q 10 1Q 11 3Q 11 1Q 12 3Q 12 1Q 13 Cumulative Subscribers Verizon FiOS Video AT&T U-Verse Key Driver: FTTx Deployments “In Wireline, U-verse continues to shine. We had our best-ever U-verse high-speed Internet sales
Slide 10: Key Driver: Wireless Backhaul
10 Key Driver: Wireless Backhaul 0X 10X 20X 30X 40X 50X 2009 2010 2011 2012 2013E 2014E Mobile Data Traffic Growth Relative to 2009 Yankee Group Coda Research Cisco Systems, Inc. Average “…a third key strategic initiative is investing in fiber builds to as many towers in our service areas as economi
Slide 11: Key Driver: Fiber to Businesses
11 $9.5B $20.0B $27.5B 2012 Business Services Revenue $5.0 Billion Addressable Business Services Market $57 Billion “The business services side, it's $2.6 billion business, growing at 34%. It has both the SMB, or small and medium business component, which is about 85% of the business, as well as the
Slide 12: Dycom's Nationwide Presence
12 Subsidiaries Dycom’s Nationwide Presence Local Credibility, National Capability Dycom Headquarters Subsidiary Headquarters
Slide 13: Focused on High Value Profitable Growth
13 Focused on High Value Profitable Growth Anticipating emerging technology trends which drive capital spending Deliberately targeting high quality, long-term industry leaders which generate the vast majority of the industry’s profitable opportunities Selectively acquiring businesses which compl
Slide 14: Well Established Customers
14 18% 14% 10% 9%8% 5% 4% 2% 2% 1% 27% Blue-chip, predominantly investment grade clients comprise the vast majority of revenue Well Established Customers Quarter Ended April 27, 2013 Customer Revenue Breakdown Comcast AT&T CenturyLink Verizon Windstream Charter Ericsson Time Warner Cable Other Front
Slide 15: Durable Customer Relationships
15 $- $50 $100 $150 $200 $250 $300 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 AT&T Comcast CenturyLink Verizon Adelphia Charter Comm Time Warner Cable Windstream $0 $200 $400 $600 $800 $1,000 $1,200 $1,400 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 Top 5 All Other $588 $842 $958 $995 $
Slide 16: Anchored by Long-Term Agreements
16 64.4% 12.6% 23.0% Revenue By Contract Type Quarter Ended April 27, 2013 Anchored by Long-Term Agreements Master Service Agreements Long-term contracts Short-term contracts Master Service Agreements (MSA’s) Multi-year, multi-million dollar arrangements covering thousands of individual work o
Slide 17: Robust Cash Flow - Investing for Growth
17 Note: Amounts represent cumulative cash flow for fiscal 2003 – April 27, 2013; Q2-13 Acquisition is the telecommunications infrastructure services subsidiaries acquired by Dycom on December 3, 2012 from Quanta Services, Inc. See “Regulation G Disclosure” for a summary of amounts. Robust Cash Flow
Slide 18: Financial Update
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Slide 19: Financial Overview
19 Financial Overview Organic revenue growth of 6.2% during Q3-2013 Solid margins and earnings Stable balance sheet Strong cash flows and liquidity Capital structure designed to produce strong equity returns
Slide 20: Quarterly and Annual Contract Revenues and Organic Growth
20 $304 $320 $267 $296 $318 $323 $293 $314 $76 $123 $- $60 $120 $180 $240 $300 $360 $420 $480 Q4-11 Q1-12 Q2-12 Q3-12 Q4-12 Q1-13 Q2-13 Q3-13 Quarterly Contract Revenues ($ in millions) Acquired Subsidiaries $369 $437 (12.0)% (10.5)% 2.0% 15.4% 4.0% (15)% (10)% (5)% 0% 5% 10% 15% 20% FY2009 FY2010(a
Slide 21: Margins and Earnings Expansion
21 Margins and Earnings Expansion (a) The amounts and percentages for EBITDA – Adjusted and amounts for Income from continuing operations –Non-GAAP are Non-GAAP financial measures adjusted to exclude certain items. See “Regulation G Disclosure” slides for a reconciliation of GAAP to Non-GAAP financi
Slide 22: Cash Flow and Liquidity
22 $54.1 $43.9 $65.1 $91.3 $- $20 $40 $60 $80 $100 FY2010 FY2011 FY2012 FY 2013 (Q3 YTD) Cash Flow from Operations ($ in millions) FY2010 FY 2013 (Q3 YTD)Full Fiscal Years Nine months ended April 27, 2013 $46.6 $49.2 $52.8 $41.3 $- $20 $40 $60 $80 FY2010 FY2011 FY2012 FY 2013 (Q3 YTD) Capital Expend
Slide 23: Q3-13 Results and Backlog
23 Note: See “Regulation G Disclosure” slides for a reconciliation of GAAP to Non-GAAP financial measures. $2,019 $2,003 $- $750 $1,500 $2,250 Q2-13 Q3-13 Backlog ($ in millions) Q3-13 Results Organic revenue growth of 6.2% in Q3-13 Revenues of $122.9 million from Acquired Subsidiaries Consoli
Slide 24: Strong Balance Sheet and Liquidity
24 Strong Balance Sheet and Liquidity January 26, 2013 April 27, 2013 22.6$ 18.2$ $275 million revolver 20.0$ 36.0$ Term Loan 125.0$ 123.4$ 277.5$ 277.5$ Total Debt (*) 422.5$ 436.9$ 44.1$ 46.7$ 210.9$ 192.3$ 7.125% Senior Subordinated Notes, due January 2021 (*) Letters of Credit outstanding Availa
Slide 25: Capital Allocated to Maximize Shareholder Returns
25 Capital Allocated to Maximize Shareholder Returns Organic growth, solid free cash flow and confidence in industry outlook promotes capital allocation strategy to further expand shareholder returns December 2012 acquisition further strengthens our customer base, geographic scope, and technical s
Slide 26: Selected Information from Q3-13 Dycom Results Conference Call Materials
Selected Information from Q3-13 Dycom Results Conference Call Materials** **The following three slides (slides 27 through 29) were used on May 22, 2013 in connection with the Company’s conference call to discuss fiscal 2013 third quarter results and are included here for your convenience. Reference
Slide 27: Looking Ahead: Outlook
27 Looking Ahead Outlook Contract Revenues Continued total and organic revenue growth as services to wireless carriers remain robust, cable construction strengthens and customers maintain growing expenditures Gross Margin % Improving margin trends as legacy margins remain solid and integration activ
Slide 28: Looking Ahead: Q4-2013 Outlook
28 Looking Ahead Q4-2013 Outlook (all amounts are estimates - actual amounts may differ) ($ in millions) Q4-2012 Q4-2013 Y-O-Y Comments Contract Revenues- (Non-GAAP for Q4-12) $315.8 (excluding $2.3 million of storm revenues) $455.0 - $475.0 (including $120.0 - $130.0 from acquired subsidiaries) Mid
Slide 29: Additional Information - Acquired Subsidiaries
29 Additional Information - Acquired Subsidiaries (a) Estimated future amortization are based on the Company’s preliminary allocation of the purchase price which is subject to revision as additional information about fair value of intangible assets becomes available. Amortization of Intangibles of A
Slide 30: Supplemental Schedules Regulation G Disclosures
Supplemental Schedules Regulation G Disclosures
Slide 31: Regulation G Disclosure
31 Regulation G Disclosure (a) Year-over-year growth percentage is calculated as follows: (i) revenues in the current twelve month period less (ii) revenues in the comparative prior twelve month period; divided by (ii) revenues in the comparative prior twelve month period. (b) Revenues from business
Slide 32: Regulation G Disclosure
32 Regulation G Disclosure Amounts may not foot due to rounding. (a) Year-over-year growth (decline) percentage is calculated as follows: (i) revenues in the quarterly period less (ii) revenues in the comparative prior year quarter period; divided by (iii) revenues in the comparative prior year quar
Slide 33: Regulation G Disclosure
33 Regulation G Disclosure The below table presents the Non-GAAP financial measures of EBITDA and Adjusted EBITDA for the respective periods. EBITDA and Adjusted EBITDA are Non-GAAP financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission. The Compa
Slide 34: Regulation G Disclosure: Cumulative Cash Flows
34 Regulation G Disclosure Amounts may not foot due to rounding. Calculation of Cumulative Cash Flows Fiscal 2002 through April 27, 2013 ($ in millions) Net Cash Provided by Operating Activities Capital Expenditures, Net of Proceeds from Asset Sales Cash Paid for Acquisitions, net of cash acquired R
Slide 35: 2013 Credit Suisse Engineering & Construction Conference
2013 Credit Suisse Engineering & Construction Conference June 6, 2013
Dycom Industries — 2013 Credit Suisse Engineering & Construction Conference on 6ix