Dycom Industries, Inc. · NYSE:DY
Dycom Industries — Investor Presentation (September 2017)
36 slides from Dycom Industries's investor presentation, Sep 20, 2017
Slide 1: Investor Presentation September 2017
Investor Presentation September 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 and customer relationships Contract revenues of $780.2 million in Q4-17 compared to $789.2 million in Q4-16, organic growth of 4.6%* N
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: Fiber passings: massive investment cycle in early stages
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 124.6 million U.S. households (Statista-2015) 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 Telephone companies deploying FTTH to enable video offerings and 1 gigabit connections Cable operators continuing to deploy fiber to small and medium businesses and enterprises with increasing urgency. Fiber deep deployments to e
Slide 8: Key Driver: FTTx Deployments
8 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 “We also have been making great headway with our fiber build. We have the largest fiber footprint in the country, and we are ahead of the
Slide 9: Key Driver: Cable business services opportunity
9 “Well, business services, let's put in perspective, is about a $5.5 billion business. We think that within the small and medium space it is a $20 billion to $25 billion opportunity within our footprint. In the small business segment it is about 70% of our revenue, 60% of our growth. We think we ha
Slide 10: Key Driver: Wireless Network Upgrades
10 0 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 500,000 20 00 20 01 20 02 20 03 20 04 20 05 20 06 20 07 20 08 20 09 20 10 20 11 20 12 20 13 20 14 20 15 20 20 Es ti m at es 20 25 Es ti m at es U S C e ll C it ie s Key Driver: Wireless Network Upgrades “…this integration as
Slide 11: Intensely Focused on Telecommunications Market
11 Intensely Focused on Telecommunications Market Contract revenues of $780.2 million for Q4-17 Services Crucial to Customers’ Success Electric and Gas Utilities and Other Underground Facility Locating Telecommunications Dycom is well-positioned to benefit from future growth opportunities Outside
Slide 12: Local Credibility, National Capability
12 Local Credibility, National Capability Dycom headquarters Primary locations Subsidiaries Dycom’s Nationwide Presence
Slide 13: Focused on High Value Profitable Growth
13 Focused on High Value Profitable Growth Anticipate emerging technology trends that drive capital spending Deliberately target high quality, long-term industry leaders which generate the vast majority of the industry’s profitable opportunities Selectively acquire businesses that complement o
Slide 14: Well Established Customers
14 Well Established Customers Top Customers Dycom has established relationships with: Telephone companies Wireless carriers Cable television multiple system operators Electric utilities and others Customer Revenue Breakdown Q4-17 Blue-chip, investment grade customers comprise a substantial p
Slide 15: Durable Customer Relationships
15 Durable Customer Relationships Revenues ($ 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: 10 Years of Robust Cash Flow Generation
17 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 18: Industry Themes
18 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 19: Financial Update
19 Financial Update
Slide 20: Strong operating results
20 Strong operating results Contract revenues of $780.2 million in Q4-17 compared to $789.2 million in Q4-16, organic growth of 4.6%* Non-GAAP Adjusted EBITDA of $118.0 million, or 15.1% of revenues in Q4-17, compared to $126.0 million, or 16.0% in Q4-16 Non-GAAP Adjusted Diluted EPS of $1.4
Slide 21: Contract revenue and organic growth trends
21 21.9% 19.4% 28.7% 20.0% 18.0% 22.9% 14.9% 4.6% 0% 5% 10% 15% 20% 25% 30% Q1-16 Q2-16 Q3-16 Q4-16 Q1-17 Q2-17 Q3-17 Q4-17 Contract Revenue Trend Annual Organic Revenue Trend Quarterly Contract Revenues Quarterly Organic Revenue Trend Annual Growth in Contract Revenues Financial charts - $ in milli
Slide 22: Earnings: Adjusted EBITDA and EPS
22 $1.18 $1.16 $2.41 $4.48 $5.26 FY2013 FY2014 FY2015 FY2016 FY2017 Quarterly Non-GAAP Adjusted EBITDA Quarterly Non-GAAP Adjusted Diluted EPS Non-GAAP Adjusted Diluted EPS Non-GAAP Adjusted EBITDA Financial charts - $ in millions, except earnings per share amounts Earnings See “Regulation G Disclos
Slide 23: Strong balance sheet and robust liquidity
23 Strong balance sheet and robust liquidity Liquidity and Cash Flow Financial tables - $ in millions Balance sheet reflects the strength of our business Liquidity of $439.9 million at the end of Q4-17 consisting of availability under our Credit Facility and cash on hand Cash Flow from Operating
Slide 24: Capital Allocated to Maximize Returns
24 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 Organic revenue grew 4.6% in Q4-17 and 14.1% in fiscal 2017, reflecting growth from several key customers Purs
Slide 25: Questions and Answers
25 Questions and Answers
Slide 26: Slides used on August 30, 2017 conference call
26 The following slides 27, 28 & 30 were used on August 30, 2017 in connection with the Company’s conference call to discuss fiscal 2017 fourth quarter results and are included for your convenience. Reference is made to slide 2 titled “Forward-Looking Statements and Non-GAAP Information” with respec
Slide 27: Q1-2018 Outlook
27 Q1-2018 Outlook Financial table- $ in millions, except earnings per share amounts (% as a percent of contract revenues) See “Regulation G Disclosure” slides 29-36 for a reconciliation of GAAP to Non-GAAP financial measures. “Q1-2018 Outlook” - This slide was prepared and used on August 30, 2017 i
Slide 28: Looking Ahead to Q2-2018
28 Looking Ahead to Q2-2018 See “Regulation G Disclosure” slides 29-36 for a reconciliation of GAAP to Non-GAAP financial measures. “Looking Ahead to Q2-2018” - This slide was prepared and used on August 30, 2017 in connection with the Company’s conference call to discuss fiscal 2017 fourth quarter
Slide 29: Explanation of Non-GAAP Measures
29 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 30: Reconciliation: Outlook Non-GAAP Diluted EPS
30 Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Financial Measures Outlook – Non-GAAP Diluted Earnings per Common Share for the Three Months Ending October 28, 2017 Unaudited Appendix: Regulation G Disclosure This slide was prepared and used on August 30, 2017 in connection with
Slide 31: Non-GAAP Organic Contract Revenue
31 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 32: Contract Revenues and Organic Growth Reconciliation
32 (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 33: Calculation of Cumulative Cash Flows
33 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 34: Non-GAAP Adjusted Net Income and Diluted EPS
34 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 35: Non-GAAP Adjusted EBITDA Reconciliation
35 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 36: Investor Presentation September 2017
Investor Presentation September 2017
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