Dycom Industries, Inc. · NYSE:DY
Dycom Industries — Investor Presentation (November 2017)
37 slides from Dycom Industries's investor presentation, Nov 29, 2017
Slide 1: Investor Presentation November & December 2017
Investor Presentation November & December 2017 Exhibit 99.1
Slide 2: Forward Looking Statements and Non-GAAP Information
2 Forward Looking Statements and Non-GAAP Information This presentation contains “forward-looking statements”. Other than statements of historical facts, all statements contained in this presentation, including statements regarding the Company’s future financial position, future revenue, prospects,
Slide 3: Dycom Overview
3 Nationwide footprint Operates in all 50 states, Washington, D.C. and in Canada Over 40 operating subsidiaries and over 14,000 employees Strong revenue base, customer relationships and profitable results Contract revenues of $756.2 million in Q1-18, included $15.5 million in revenue from stor
Slide 4: Telecommunication Industry Overview
4 Telecommunications networks fundamental to economic progress Fiber is the foundation globally for wireline and wireless networks Consumer demand for bandwidth driving fiber deployments by telecom providers With a low percentage of total broadband connections provisioned by fiber in U.S., significa
Slide 5: Massive investment cycle in early stages - U.S. fiber passings
5 30 million 0 50 100 150 200 250 2016 Estimate of Homes Passed Homes Available U. S. H o m es w it h F ib er P as si n gs (a ) (I n M ill io n s) Massive investment cycle in early stages - total U.S. homes passed with fiber below 20% (a) Potential of 125.8 million U.S. households (Statista-2016) wi
Slide 6: Strong Secular Trend
6 Strong Secular Trend “IP traffic in North America will reach 85 EB per month by 2021, at a CAGR of 20 percent. Monthly Internet traffic in North America will generate 11 billion DVDs’ worth of traffic, or 44.7 EB per month.” “Business IP traffic will grow fastest in North America. Business IP traf
Slide 7: Industry drivers
7 Industry drivers Firm and strengthening end market opportunities Fiber deployments in contemplation of newly emerging wireless technologies have begun in many regions of the country. A significant number of new project initiations will occur in the near term. Wireless construction activity in
Slide 8: Key Driver: FTTx Deployments
8 1.0 2.2 6 + 14 0 2 4 6 8 10 12 14 Q4-15 Q2-16 Q3-17 2019 AT&T Expectations U S H o m es P as se d ( In M ill io n s) 0 2 4 6 8 10 12 Q2-16 Q2-17 2018 Estimate 2019 Estimate A d d re ss ab le B ro ad b an d U n it s >1 0 0 M p b s (I n M ill io n s) Key Driver: FTTx Deployments “Even more exciting,
Slide 9: Key Driver: Wireless Network Upgrades
9 Key Driver: Wireless Network Upgrades “Mobile connectivity has become essential for many network users. Most people already consider mobile voice service a necessity, and mobile voice, data, and video services are fast becoming an integral part of consumers and business users’ lives. Used extensiv
Slide 10: Key Driver: Fiber to Businesses
10 “Moving on to business services, which continues to be a top driver of our overall cable results. We delivered another strong quarter of double-digit growth, with revenue increasing 12.6% to $1.6 billion during the quarter, primarily driven by customer growth. We added 31,000 business customer re
Slide 11: Intensely Focused on Telecommunications Market
11 Intensely Focused on Telecommunications Market Contract revenues of $756.2 million for Q1-18 Services Crucial to Customers’ Success Electric and Gas Utilities and Other Underground Facility Locating Telecommunications Dycom is well-positioned to benefit from future growth opportunities Outside
Slide 12: Local Credibility, National Capability
12 Local Credibility, National Capability Subsidiaries Dycom’s Nationwide Presence
Slide 13: Focused on High Value Profitable Growth
13 Focused on High Value Profitable Growth Anticipate emerging technology trends that drive capital spending Deliberately target high quality, long-term industry leaders which generate the vast majority of the industry’s profitable opportunities Selectively acquire businesses that complement o
Slide 14: Well Established Customers
14 Well Established Customers Top Customers Dycom has established relationships with: Telephone companies Wireless carriers Cable television multiple system operators Electric utilities and others Customer Revenue Breakdown Q1-18 Blue-chip, investment grade customers comprise a substantial p
Slide 15: Durable Customer Relationships
15 Durable Customer Relationships Revenues ($ in millions) Notes: For comparison purposes, revenues from Verizon Communications Inc. and XO Communications LLC’s fiber-optic network business have been combined for periods prior to their February 2017 merger. Revenues from Charter Communications, Inc.
Slide 16: Anchored by Long-Term Agreements
16 Anchored by Long-Term Agreements Dycom is party to hundreds of MSA’s and other arrangements with customers that extend for periods of one or more years Generally multiple agreements maintained with each customer Master Service Agreements (MSA’s) Multi-year, multi-million dollar arrangemen
Slide 17: Industry Themes
17 Industry Themes Industry increasing network bandwidth dramatically Major industry participants deploying significant 1 gigabit wireline networks Emerging wireless technologies require incremental wireline deployments o A complementary wireline investment cycle is fundamental to applications
Slide 18: 10 Years of Robust Cash Flow Generation
18 Cash Flow from Operations $1,245 Other Cash Flow $650 Cap-Ex, net $823 Business Acquisitions $597 Share Repurchases $455 Sources of Cash Uses of Cash * Sources and Uses of Cash ($ in millions) 10 Years of Robust Cash Flow Generation Notes: Amounts represent cumulative cash flow for fiscal 2008 –
Slide 19: Financial Update
19 Financial Update
Slide 20: Financial Overview
20 Strengthening market opportunities Contract revenues of $756.2 million in Q1-18, included $15.5 million in revenue from storm restoration services Non-GAAP Adjusted EBITDA of $97.6 million, or 12.9% of revenues in Q1-18 Non-GAAP Adjusted Diluted EPS of $0.99 in Q1-18 Solid financial pro
Slide 21: Fiscal Year Change
21 Fiscal Year Change In September 2017, the Company changed its fiscal year end from July to January Beginning with a six month transitional period ending January 27, 2018, the Company’s fiscal year will end on the last Saturday of January Fiscal year 2019 will be for the period from January
Slide 22: Revenue trend charts
22 $559 $665 $789 $799 $701 $786 $780 $756 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Q1-18 Contract Revenue Trend Annual Organic Revenue Trend Quarterly Contract Revenues Quarterly Organic Revenue Trend Annual Growth in Contract Revenues Financial charts - $ in millions *Organic % growth adjusted fo
Slide 23: Earnings
23 $180 $188 $265 $390 $442 11.2% 10.4% 13.1% 14.6% 14.4% FY2013 FY2014 FY2015 FY2016 FY2017 Non-GAAP Adjusted EBITDA Non-GAAP Adjusted EBITDA as a % of Revenue Non-GAAP Adjusted EBITDA $1.18 $1.16 $2.41 $4.48 $5.26 FY2013 FY2014 FY2015 FY2016 FY2017 Quarterly Non-GAAP Adjusted EBITDA Quarterly Non-
Slide 24: Strong balance sheet and robust liquidity
24 Strong balance sheet and robust liquidity Liquidity and Cash Flow Financial tables - $ in millions Balance sheet reflects the strength of our business Liquidity of $425.8 million at the end of Q1-18 consisting of availability under our Credit Facility and cash on hand Cash Flow from Operating
Slide 25: Capital Allocated to Maximize Returns
25 Capital Allocated to Maximize Returns Strong balance sheet, solid cash flow and long-term confidence in industry outlook drives capital allocation strategy Invest in organic growth Revenues grew organically 14.1% in fiscal 2017 Pursue complementary acquisitions Fiscal 2013 - 2017 acquisit
Slide 26: Questions and Answers
CDYCOM THE PEOPLE CONNECTING AMERICA‘ Questions and Answers
Slide 27: Selected Information from Q1-18 Dycom Results Conference Call Materials
Selected Information from Q1-18 Dycom Results Conference Call Materials The following slides 28, 29 & 30 were used on November 20, 2017 in connection with the Company’s conference call for its fiscal 2018 first quarter results and are included for your convenience. Reference is made to slide 2 title
Slide 28: Q2-2018 Outlook
28 Q2-2018 Outlook Financial table- $ in millions, except earnings per share amounts (% as a percent of contract revenues) See “Regulation G Disclosure” slides 30-36 for a reconciliation of GAAP to Non-GAAP financial measures. “Q2-2018 Outlook” - This slide was prepared and used on November 20, 2017
Slide 29: Looking Ahead to Q1-2019
29 Looking Ahead to Q1-2019 See “Regulation G Disclosure” slides 30-36 for a reconciliation of GAAP to Non-GAAP financial measures. “Looking ahead to Q1-2019” - This slide was prepared and used on November 20, 2017 in connection with the Company’s conference call to discuss fiscal 2018 first quarter
Slide 30: Explanation of Non-GAAP Measures
30 Explanation of Non-GAAP Measures The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). In the Company’s quarterly results releases, trend schedules, conference calls, slide presentations, and webcasts, it may use or discuss Non-GAAP fin
Slide 31: Reconciliation of Non-GAAP Financial Measures: Outlook Diluted EPS
31 Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Financial Measures Outlook – Non-GAAP Diluted Earnings per Common Share for the Three Months Ending January 27, 2018 Unaudited Appendix: Regulation G Disclosure This slide was prepared and used on November 20, 2017 in connection wit
Slide 32: Regulation G Disclosure: Non-GAAP Organic Contract Revenue
32 Appendix: Regulation G Disclosure Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Financial Measures Non-GAAP Organic Contract Revenue Unaudited ($ in millions) (a) Q4-16 contained 14 weeks as a result of our 52/53 week fiscal year as compared to 13 weeks in all other quarterly p
Slide 33: Contract Revenues and Organic Growth Reconciliation
33 (a) Non-GAAP adjustments in FY 2016 reflect adjustments in Q4-16 resulting from the Company’s 52/53 week fiscal year. The Q4-16 Non-GAAP adjustment is calculated independently for each comparative period as (i) contract revenues less, (ii) revenues from acquired businesses in each applicable peri
Slide 34: Calculation of Cumulative Cash Flows Fiscal 2008 through Fiscal 2017
34 Notes: Amounts may not add due to rounding. 1 Other financing activities represents net cash provided by (used in) financing activities less repurchases of common stock. 2 Other investing activities represents net cash provided by (used in) investing activities less capital expenditure, net of pr
Slide 35: Non-GAAP Adjusted Net Income and Adjusted Diluted EPS Reconciliation
35 Notes: Amounts above may not add due to rounding. Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Financial Measures Non-GAAP Adjusted Net Income, Non-GAAP Adjusted Diluted EPS, and Non-GAAP Adjusted Interest Expense Unaudited ($ in 000's, except per share amounts) Appendix: Regu
Slide 36: Non-GAAP Adjusted EBITDA Reconciliation
36 Appendix: Regulation G Disclosure Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Financial Measures Non-GAAP Adjusted EBITDA Unaudited ($ in 000's, except per share amounts) Notes: Amounts above may not add due to rounding. Use of Non-GAAP Financial Measures: The Company reports
Slide 37: November & December 2017
Investor Presentation November & December 2017
Dycom Industries — Investor Presentation (November 2017) on 6ix