Quanta Services, Inc. · NYSE:PWR
Quanta Services — Q4 2023 Earnings Presentation
20 slides from Quanta Services's earnings presentation, Feb 22, 2024
Slide 1: Fourth Quarter and Full-Year 2023 Operational and Financial Commentary
February 22, 2024 Fourth Quarter and Full-Year 2023 Operational and Financial Commentary This document is a supplement to our press release reporting fourth quarter and full-year 2023 results for Quanta Services, Inc. (Quanta, we, us or our). Our earnings release was previously distributed by Cision
Slide 2: Select Full-Year 2023 Accomplishments
Select Full-Year 2023 Accomplishments 2023 was a significant year for Quanta, with strategic, operational and financial accomplishments throughout. We believe 2023 represents a transition year to an expected multi-decade infrastructure investment cycle, and we look forward with excitement at our mul
Slide 3: 4Q23 Financial Results and Commentary: Electric Power Segment
4Q23 Financial Results and Commentary Electric Power Infrastructure Solutions Segment (Electric Power) * Operating Income Margins are calculated by dividing operating income by revenues Our Electric Power segment operations performed well, with revenues of $2.5 billion, which resulted in full year 2
Slide 4: Electric Power backlog and demand outlook
Demand for our electric power infrastructure solutions remains strong, as evidenced by backlog of $15.5 billion at year-end 2023. Accordingly, we continue to invest in resources to support the anticipated start-up of multiple, multi-year utility programs and projects. Utilities across the United Sta
Slide 5: Renewable Energy Infrastructure Solutions Segment
Renewable Energy Infrastructure Solutions Segment (Renewable Energy) * Operating Income Margins are calculated by dividing operating income by revenues The Renewable Energy segment had a strong finish to the year, with revenues of $2.0 billion in the fourth quarter of 2023, which resulted in full-ye
Slide 6: Renewable Energy segment backlog reached $8.1 billion
Renewable Energy segment total backlog reached $8.1 billion as of year-end 2023, driven by various renewable generation, transmission and substation projects, as well as the addition of the final portion of the SunZia wind contract. We believe the segment’s rapid backlog growth reflects our strong c
Slide 7: Underground Utility & Infrastructure Solutions Segment
Underground Utility & Infrastructure Solutions Segment (Underground and Infrastructure) * Operating Income Margins are calculated by dividing operating income by revenues The Underground and Infrastructure segment delivered solid results, with revenues of $1.3 billion in the fourth quarter of 2023 a
Slide 8: Underground and Infrastructure segment backlog
*Refer to the Appendix for a definition and reconciliation of this non-GAAP financial measure to its most directly comparable GAAP measure Total backlog for the Underground and Infrastructure segment was $6.5 billion, which was lower than the third quarter of 2023 due to progress on larger pipeline
Slide 9: Free Cash Flow & Days Sales Outstanding
indicative of growth in demand for our solutions across our end markets. We expect to achieve record backlog again in 2024 based on the pipeline of activity we are actively pursuing and believe there are opportunities for record backlog in future years as we plan with our customers to provide comple
Slide 10: Balance Sheet & Liquidity
Balance Sheet & Liquidity As of December 31, 2023, we had total liquidity of approximately $2.8 billion and a debt-to-EBITDA ratio of 1.8 as calculated under our credit agreement. We measure capital deployment opportunities against return opportunities presented through stock repurchases, and we see
Slide 11: Full-Year 2024 Guidance
Full-Year 2024 Guidance *The investment community is encouraged to review Quanta’s Outlook Expectations Summary, which can be found on our Investor Relations website at http://investors.quantaservices.com in the News & Events and Financial Info sections. This document provides a detailed discussion
Slide 12: Electric Power Segment Guidance
Electric Power Segment Guidance Actuals 2024 Estimated Range 2022 2023 Low Mid High Revenues ($M) $8,940 $9,697 $10,400 $10,450 $10,500 Revenue Growth 17.3% 8.5% 7.2% 7.8% 8.3% OI Margin* 10.7% 10.5% ~10.5% *Operating income margins are calculated by dividing operating income by revenues We expect E
Slide 13: Renewable Energy Segment Guidance
We expect operating income margins for the Renewable Energy segment to be approximately 9.0% for 2024, consistent with the operating income margin for the segment during the second half of 2023. Similar to our Electric Power segment, our Canadian operations are expected to be dilutive to Renewable E
Slide 14: Positive Multi-Year Outlook
Positive Multi-Year Outlook We believe the transition towards a reduced-carbon economy is gaining momentum and that we are in the early stages of a multi-decade infrastructure build. We expect to capitalize on significant opportunities across our end markets driven by our collaborative, solutions-ba
Slide 15: Appendix: Notice to Investors
NOTICE TO INVESTORS This commentary (and oral statements regarding the subject matter of this commentary) includes forward-looking statements intended to qualify under the “safe harbor” from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statemen
Slide 16: Non-GAAP measure definitions
Gains and losses on sales of investments vary from period to period depending on activity; Asset impairment charges vary from period to period depending on economic and other factors; and Change in fair value of contingent consideration liabilities varies from period to period depending on, among ot
Slide 17: Reconciliation of Adjusted Net Income and Adjusted Diluted EPS
Reconciliation of Adjusted Net Income Attributable to Common Stock and Adjusted Diluted Earnings Per Share Attributable to Common Stock ($000s, except per share amounts) 2022 2023 FY 2024 GUIDANCE RANGE 4Q FY 4Q FY Low Mid High Reconciliation of adjusted net income attributable to common stock: Net
Slide 18: Reconciliation of Adjusted EBITDA and Free Cash Flow
Reconciliation of Adjusted EBITDA ($000s) 2022 2023 FY 2024 GUIDANCE RANGE 4Q FY 4Q FY Low Mid High Net income attributable to common stock (GAAP as reported) $ 162,572 $ 491,189 $ 210,908 $ 744,689 $ 850,800 $ 888,050 $ 925,300 Interest expense, net 35,551 121,757 43,627 176,083 143,000 146,000 149
Slide 19: Reconciliation of Backlog
Reconciliation of Backlog ($000s) December 31, 2022 March 31, 2023 June 30, 2023 September 30, 2023 December 31, 2023 12 Month Total 12 Month Total 12 Month Total 12 Month Total 12 Month Total Electric Power Infrastructure Solutions Remaining performance $ 2,124,820 $ 3,033,472 $ 2,420,570 $ 3,986,7
Slide 20: Cautionary Statement About Forward-Looking Statements and Information
Cautionary Statement About Forward-Looking Statements and Information This commentary (and oral statements regarding the subject matter of this commentary) contains forward-looking statements intended to qualify for the “safe harbor” from liability established by the Private Securities Litigation Re