Quanta Services, Inc. · NYSE:PWR
Quanta Services — Merger or Acquisition (July 2024)
26 slides from Quanta Services's merger presentation, Jul 18, 2024
Slide 1: Creating An Industry-Leading Electrical Infrastructure Platform
Acquires Creating An Industry-Leading Electrical Infrastructure Platform Delivering Comprehensive Craft-Led Infrastructure Solutions from Electron Generation to Consumption Investor Investor Presentation Presentation Date, July 18,2021 2024
Slide 2: Notice to Investors
NOTICE TO INVESTORS This presentation (and oral statements regarding the subject matter of this presentation) 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 stat
Slide 3: Quanta Acquires Cupertino Electric Inc. (CEI)
QUANTA ACQUIRES CUPERTINO ELECTRIC INC. (CEI) Comprehensive End-to-End Electrical Infrastructure Solution from Electron Generation to Transmission to Consumption Power Power Grid Power Generation Transmission Consumption Critical Enabler of Key Mega Trends • Transition to renewable • Manufacturing a
Slide 4: Strategic Rationale
STRATEGIC RATIONALE Premier Electrical Solutions Provider to Industries Driving Load Growth and the Energy Transition Combination creates comprehensive end-to-end electrical infrastructure solution from electron 1 generation to transmission to consumption • CEI provides a leading nationwide electric
Slide 5: Cupertino Electric Overview
— CUPERTINO" === ELECTRIC INC. OVERVIEW @Q (ESyPERTING: === ELECTRIC INC. QUANTA
Slide 6: Cupertino Electric Overview
CUPERTINO ELECTRIC OVERVIEW Premier Electrical Solutions Partner with National Service Footprint Offering Opportunities for Growth • Founded in 1954 and headquartered in San Jose, CA • Formerly management- and family-owned, multi-generational • Self-performs >80% of its work, ~30% of revenues from c
Slide 7: Focused On Attractive Growth Markets Levered to Technology, Energy Transition and Infrastructure
CUPERTINO ELECTRIC OVERVIEW Focused On Attractive Growth Markets Levered to Technology, Energy Transition and Infrastructure Technology Renewable Energy Infrastructure & Commercial Segment ~45% of ’24E Revenues ~40% of ’24E Revenues ~15% of ’24E Revenues Data Center Modular Solar Battery Storage Inf
Slide 8: Synergistic Platform for Growth
SYNERGISTIC PLATFORM FOR GROWTH CEI Expands Quanta’s Craft Skill Capabilities and Enhances Our Electrical Infrastructure Solutions Platform • Growth strategy centered around providing comprehensive customer solutions • As the scale and complexity of infrastructure programs have expanded, Quanta’s ab
Slide 9: Access to Large and Growing Technology Market
ACCESS TO LARGE AND GROWING TECHNOLOGY MARKET A Leading Platform to Provide Electrical System Solutions to the Hyperscaler Capex Growth (1) ($ in Billions) Technology and Data Center Market $350 $305 • CEI is purpose built to deliver turnkey electrical system solutions to the technology ~14% CAGR $2
Slide 10: CEI Enhances Our Renewable Solutions Portfolio
CEI ENHANCES OUR RENEWABLE SOLUTIONS PORTFOLIO Provides Quanta with a Complementary Mid-Market Utility-Scale Renewables Platform Overview Strategic Fit • CEI’s solar and battery storage capabilities provide Quanta with an • Significant demand for and growth in mid-market utility-scale solar establis
Slide 11: Infrastructure and Commercial Electrical Solutions
INFRASTRUCTURE AND COMMERCIAL ELECTRICAL SOLUTIONS Solutions-Oriented Approach with Synergistic Customer Relationships • Solutions-oriented EPC approach for complex electrical systems, with synergistic relationships across the technology, industrial and renewable energy client base • Natural evoluti
Slide 12: Complementary Infrastructure Solutions
COMPLEMENTARY INFRASTRUCTURE SOLUTIONS Comprehensive End-to-End Electrical Infrastructure Solution from Electron Generation to Transmission to Consumption Generation Transmission Consumption Utility Utility Utility Scale Front Scale Scale Battery End Transmission Energized Inside Testing & Solar Win
Slide 13: Transaction Summary & Financial Overview
TRANSACTION SUMMARY & FINANCIAL OVERVIEW Page 13
Slide 14: Transaction Summary
TRANSACTION SUMMARY Leading Data Center Electrical System Platform and Complementary Solar and Battery Storage Capabilities • Upfront purchase price of approximately $1.54 billion, subject to closing adjustments, plus three-year earn-out of up to $200 million Transaction • Approximately $1.3 billion
Slide 15: CEI Historical and Estimated Financial Summary
CEI HISTORICAL AND ESTIMATED FINANCIAL SUMMARY Strong Growth, Profitability, and Backlog Remaining Performance Obligations Revenues Adjusted EBITDA(1) 9% / Total Backlog(2) 10% $mm $mm $mm CAGR CAGR $1,900 $175 - $195 $155 - $175 $2,325 - $2,425 $156 $2,100 - $2,200 $1,961 $1,300 2023 2024E 2025E 20
Slide 16: CEI 2025 Financial Expectations
CEI 2025 FINANCIAL EXPECTATIONS Attractive Contribution to Revenues, Adjusted EBITDA and Adjusted Earnings Per Share CEI Estimated 2025 Contribution Low Mid High Est. Revenues ($ B) $2.325 $2.375 $2.425 Est. Adjusted $175 $185 $195 EBITDA(1) ($ MM) Est. Diluted Adj. EPS $0.40 $0.45 $0.50 Refer to ap
Slide 17: Multi-Year Expectations
MULTI-YEAR EXPECTATIONS Attractive End Markets, Capital-Light Operations and Attainable Synergies Drive Long-Term Shareholder Value • We believe there is opportunity to enhance CEI’s profitable growth through operating leverage and volume-driven synergies, which provides a path for improvement of CE
Slide 18: Key Takeaways
KEY TAKEAWAYS Premier Electrical Solutions Provider to Industries Driving Load Growth and the Energy Transition 1 Combination creates comprehensive end-to-end electrical infrastructure solution from electron generation to transmission to consumption - focused on the most active and attractive areas
Slide 19: Connect With Quanta Services Social Media Channels
Connect With Quanta Services Social Media Channels @QuantaIR @Quanta_Services Quanta Services, Inc. Investor Contact Corporate Office Kip Rupp, CFA, IRC 2727 North Loop West Vice President – Investor Relations Houston, TX 77008 713-341-7260 713-629-7600 Sean Eastman www.quantaservices.com Director –
Slide 20: Appendix
APPENDIX = CUPERTINO™ quiaty GE ELECTAIC ING. Page 20
Slide 21: Reconciliation Tables and Cautionary Statement Regarding Forward-Looking Statements
APPENDIX RECONCILIATION TABLES AND CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS AND INFORMATION
Slide 22: Reconciliation of Non-GAAP Financial Measures
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES CUPERTINO EBITDA AND ADJUSTED EBITDA (in thousands) (Unaudited) Year Ended December 31, 2023 Net income attributable to common stock (GAAP as reported) $ 79,000 Interest and other financing expenses 1,323 Interest income (14,676) Provision for income tax
Slide 23: Reconciliation of Return on Invested Capital
Reconciliation of Return on Invested Capital Reconciliation of Net operating profit after tax, Average invested capital and Return on Invested Capital 2022 2023 Net income from continuing operations attributable to common stock (as defined by GAAP) $ 744,689 Interest expense, net of interest income
Slide 24: Estimated Non-GAAP Financial Measures
ESTIMATED NON-GAAP FINANCIAL MEASURES We have not provided the most directly comparable GAAP financial measures, or a quantitative reconciliation thereto, for the forward- looking guidance for 2024 and 2025 of CEI’s estimated adjusted EBITDA, CEI’s estimated contribution to Quanta's EBITDA, CEI's es
Slide 25: Cautionary Statement About Forward-Looking Statements
CAUTIONARY STATEMENT ABOUT FORWARD-LOOKING STATEMENTS This presentation (and oral statements regarding the subject matter of this presentation) contains forward-looking statements intended to qualify for the “safe harbor” from liability established by the Private Securities Litigation Reform Act of
Slide 26: Cautionary Statement About Forward-Looking Statements
CAUTIONARY STATEMENT ABOUT FORWARD-LOOKING STATEMENTS • Quarterly variations in operating and financial results, liquidity, financial condition, cash flows, capital requirements and reinvestment opportunities; • Trends and growth opportunities in relevant markets, including Quanta’s and CEI’s abilit