Slide 1: Investor Presentation November/December 2016
Investor Presentation November/December 2016 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 Leading supplier of specialty contracting services to telecommunication providers Nationwide footprint Operates in all 50 states, Washington, D.C. and in Canada Over 40 operating subsidiaries Over 13,000 employees Strong revenue base and customer relationships Contract revenues of $799.2 m
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 less than 15% total broadband connections provisioned by fiber in U.S., significant opp
Slide 5: Customer executive commentary on fiber investment
5 “Yes, it is better. It is, where we have the -- it's one of the reasons we continue to accelerate fibre. […] Meaning, for investors on the line, FTTN or FTTH when I do that. That's clearly where we don't have either of those footprints, where we see the, in essence, the decline in Internet subs. B
Slide 6: Massive investment cycle in early stages - U.S. homes passed with fiber
6 Massive investment cycle in early stages - total U.S. homes passed with fiber less than 15% (a) Potential of 124.6 million U.S. households (Statista-2015) with estimate that each home will be passed by two separate telecom providers. Source: Fiber to the Home Council (FTTH Council) (Nov. 2015). 18
Slide 7: Strong Secular Trend
7 Strong Secular Trend “IP traffic in North America will reach 59.1 EB (exabytes) per month by 2020, growing at a CAGR of 19 percent.” Cisco VNI: Forecast and Methodology, 2015–2020 (June 2016) “In North America, 88% of fixed broadband connections will be faster than 10 Mbps in 2020, up from 64% tod
Slide 8: Industry drivers
8 Industry drivers Firm and strengthening end market drivers Telephone companies deploying FTTx to enable video offerings and 1 gigabit connections Cable operators continuing to deploy fiber to small and medium businesses with overall cable capital expenditures, new build opportunities, and capa
Slide 9: Key Driver: FTTx Deployments
9 Key Driver: FTTx Deployments “So we've had this plan about fiber investments for a number of years. This 12.5 million commitment that we made to the FCC with regard to the DIRECTV transaction, it's just another step in that process. It's a commitment made, and it's going to be a commitment kept. W
Slide 10: Key Driver: Fiber to Businesses
10 Key Driver: Fiber to Businesses 1 Trailing Twelve Month Period ended October 30, 2016 2 Calculated as the combination of the estimated addressable market given by Charter ($20Bn) and Time Warner Cable ($10Bn) in their respective earnings transcripts prior to their May 2016 merger. “Concerning the
Slide 11: Key Driver: Wireless Network Upgrades
11 Key Driver: Wireless Network Upgrades “If you think about it, we never built FiOS in the city of Boston and there was a reason for that. We looked at it and we said, okay, it's all right, but from the standpoint of the return profile, it was a bit marginal. But when I layer in the capital leverag
Slide 12: Key Driver: Connect America Fund
12 Key Driver: Connect America Fund “On the legacy side, let's talk about the CAF-II. We will have a 170,000 homes passed by the end of this year. And the CAF-II program runs all the way to 2020. And there's milestones that we have committed to with the regulators to achieve every year as far as how
Slide 13: Intensely Focused on Telecommunications Market
13 Intensely Focused on Telecommunications Market Outside Plant & Equipment Installation Premise Equipment Installation Wireless Engineering Underground Facility Locating Contract revenues of $799.2 million for Q1-17 Services Crucial to Customers’ Success Electric and Gas Utilities and Oth
Slide 14: Local Credibility, National Capability
14 Local Credibility, National Capability Dycom headquarters Primary locations Subsidiaries Dycom’s Nationwide Presence
Slide 15: Focused on High Value Profitable Growth
15 Focused on High Value Profitable Growth Anticipate emerging technology trends that drive capital spending Deliberately target high quality, long-term industry leaders which generate the vast majority of the industry’s profitable opportunities Selectively acquire businesses that complement o
Slide 16: Well Established Customers
16 Well Established Customers Top Customers Dycom has established relationships with: Telephone companies Wireless carriers Cable television multiple system operators Electric utilities and others Customer Revenue Breakdown Q1-17 Blue-chip, investment grade customers comprise a substantial p
Slide 17: Durable Customer Relationships
17 Durable Customer Relationships Revenues ($ in millions) Note: For comparison purposes, revenues from Charter Communications, Inc., Time Warner Cable Inc., and Bright House Networks, LLC have been combined for periods prior to their May 2016 merger.
Slide 18: Anchored by Long-Term Agreements
18 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 19: Years of Robust Cash Flow Generation
19 10 Years of Robust Cash Flow Generation Sources and Uses of Cash ($ in millions) Notes: Amounts represent cumulative cash flow for fiscal 2007 – fiscal 2016; See “Regulation G Disclosure” slides as set forth in the Appendix for a summary of amounts. Amounts may not add due to rounding. 1 Other ca
Slide 20: Industry Themes
20 Industry Themes Industry increasing network bandwidth dramatically Major industry participants deploying significant wireline networks Newly deployed networks provisioning 1 gigabit speeds; multi-gigabit speeds planned by some industry participants Industry developments have produced oppo
Slide 21: Financial Update
Financial Update Financial Update
Slide 22: Financial Overview
22 Strong operating results Contract revenues of $799.2 million in Q1-17 compared to $659.3 million in Q1-16, organic growth of 18.0%* Non-GAAP Adjusted EBITDA of $129.2 million, or 16.2% of revenues in Q1-17, compared to $105.7 million, or 16.0% in Q1-16 Non-GAAP Adjusted Diluted EPS increa
Slide 23: Contract Revenue Trend
23 Contract Revenue Trend Annual Organic Revenue Trend Quarterly Contract Revenues Quarterly Organic Revenue Trend Annual Growth in Contract Revenues Financial charts - $ in millions See “Regulation G Disclosure” slides 32-37 for a reconciliation of GAAP to Non-GAAP financial measures. Strong and su
Slide 24: Earnings
24 Earnings Non-GAAP Adjusted EBITDA Quarterly Non-GAAP Adjusted EBITDA Non-GAAP Adjusted Diluted EPS Financial charts - $ in millions, except earnings per share amounts See “Regulation G Disclosure” slides 32-37 for a reconciliation of GAAP to Non-GAAP financial measures. Quarterly Non-GAAP Adjuste
Slide 25: Strong balance sheet and robust liquidity
25 Strong balance sheet and robust liquidity Liquidity and Cash Flow Financial tables - $ in millions Liquidity exceeds $346 million at the end of Q1-17 consisting of availability from our Credit Facility and cash on hand Cash Flow from Operating Activities Operating cash flows support strong or
Slide 26: Capital Allocated to Maximize Returns
26 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 18.0 % in Q1-17 and 22.7% in fiscal 2016, reflecting growth from several key customers Pu
Slide 27: Financial Update Questions and Answers
27 Financial Update Questions and Answers
Slide 28: Selected Information from Q1-17 Dycom Results Conference Call Materials
28 Financial Update Selected Information from Q1-17 Dycom Results Conference Call Materials The following slides 29-31 were used on November 22, 2016 in connection with the Company’s conference call to discuss fiscal 2017 first quarter results and are included for your convenience. Reference is made
Slide 29: Q2-2017 Outlook and Commentary
29 Q2-2016 Included for comparison Q2-2017 Outlook and Commentary Contract Revenues $ 559.5 $640 - $670 Expectations of normal winter weather Broad range of demand from several large customers Robust 1 gigabit deployments, cable capacity projects accelerating, CAF II firmly underway, core mark
Slide 30: Looking Ahead to Q3-2017
30 Looking Ahead to Q3-2017 Q3-2016 Included for comparison Q3-2017 Outlook and Commentary Contract Revenues $ 664.6 Total revenue growth % of mid to high single digits as a % of revenue compared to Q3-16 Expectation of normal winter weather Broad range of demand from several large customers R
Slide 31: Reconciliation of Non-GAAP Financial Measures: Outlook Diluted EPS
31 Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Financial Measures Outlook – Diluted Earnings per Common Share Unaudited Use of Non-GAAP Financial Measures The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). In our qu
Slide 32: Appendix: Regulation G Disclosure
32 Appendix: Regulation G Disclosure Use of Non-GAAP Financial Measures The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). In our quarterly results releases, trend schedules, conference calls, slide presentations, and webcasts, we may u
Slide 33: Contract Revenues and Organic Growth Reconciliation
33 1 Non-GAAP adjustments in FY 2016 reflect adjustments in Q4-16 resulting from the Company’s 52/53 week fiscal year of $52.9 million. The Q4-16 Non-GAAP adjustments reflect the impact of the additional week in Q4-16 and are calculated by (i) contract revenues less acquired revenue, divided by (ii)
Slide 34: Calculation of Cumulative Cash Flows Fiscal 2007 through Fiscal 2016
34 Notes: Amounts may not add due to rounding. 1 Other financing activities represents net cash provided by (used in) financing activities less repurchases of common stock. 2 Other investing activities represents net cash provided by (used in) investing activities less capital expenditure, net of pr
Slide 35: Non-GAAP Adjusted Net Income and Adjusted Diluted EPS
35 Notes: Amounts above may not add due to rounding. Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Financial Measures Non-GAAP Adjusted Net Income, Non-GAAP Adjusted Diluted EPS, and Non-GAAP Adjusted Interest Expense Unaudited ($ in 000's, except per share amounts) Use of Non-GAA
Slide 36: Non-GAAP Adjusted EBITDA
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) Use of Non-GAAP Financial Measures: The Company reports its financial results in accordance with U.S. gen
Slide 37: Explanation of Non-GAAP Measures
37 Explanation of Non-GAAP Measures Appendix: Regulation G Disclosure 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,
Slide 38: November/December 2016
Investor Presentation November/December 2016