Slide 1: 4Q and Full-Year 2022 Earnings Call Presentation
4Q and Full-Year 2022 Earnings Call Presentation February 23, 2023
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: Call Participants and Agenda
Call Participants and Agenda Duke Austin • Introduction and Forward-Looking President and Chief Executive Officer Statements Disclaimer • 2022 Results, Operational and Strategic Jayshree Desai Commentary Chief Financial Officer • Financial Review and Discussion Kip Rupp • Outlook Vice President, Inv
Slide 4: 2022: Another Year of Solid, Safe Execution and Profitable Growth
2022: Another Year of Solid, Safe Execution and Profitable Growth • Strong full-year 2022 results include record: *Adj. ◦ Revenues EBITDA(1) *Adj. ◦ Adjusted EBITDA *Operating EPS(1) Income ◦ Adjusted EPS $1.7B ◦ Total Backlog $6.34 $872M ◦ Cash from Operations *Cash from • Results built off an indu
Slide 5: Select Full-Year 2022 Accomplishments
Select Full-Year 2022 Accomplishments • Advanced our front-end solutions strategy, both organically and through acquisition and investments • Record Electric Power Infrastructure Solutions segment revenues • Expanded emergency response capabilities - strong and safe emergency response performance •
Slide 6: Electric Power Infrastructure Solutions
Electric Power Infrastructure Solutions • Another strong year of profitable growth despite supply chain challenges • Reflects solid and safe execution, robust demand for our services and operational excellence ◦ Grid modernization, system hardening, grid upgrades for increased EV penetration and eme
Slide 7: Renewable Energy Infrastructure Solutions
Renewable Energy Infrastructure Solutions • Utilities and renewable developers continue to advance carbon- reduction initiatives, increase electrification and lead the energy transition • Achieving this will require substantial incremental investment in transmission, substation and renewable generat
Slide 8: Underground Utility & Infrastructure Solutions
Underground Utility & Infrastructure Solutions Projected North America Green Hydrogen Demand(1) • Consistently performed at a high level throughout 2022 • Revenues grew strongly and margins significantly improved ◦ Solid demand for gas utility, pipeline integrity and industrial services. Executed we
Slide 9: Across Our Portfolio, Megatrends Provide Multiple Paths for Growth
Across Our Portfolio, Megatrends Provide Multiple Paths for Growth SOUND STRATEGY * STRENGTH AND SUSTAINABILITY * FAVORABLE LONG-TERM TRENDS * STRONG FINANCIAL PROFILE 9
Slide 10: Strong 2022 Performance and Positive Multi-Year Outlook
Strong 2022 Performance and Positive Multi-Year Outlook • 2022 performance and full-year 2023 expectations demonstrate our confidence in the strength and sustainability of our business and long-term strategy, favorable end-market trends, our ability to safely execute and our strong competitive posit
Slide 11: 4Q22 Segment Results versus 4Q21
4Q22 Segment Results versus 4Q21 Op Inc %(1) ($M) Revenues Commentary Change (bps) + Revenues increased primarily due to increased spending by our utility customers on grid modernization and hardening, Electric resulting in increased demand for electric power services, as well as $40M in revenues fr
Slide 12: Backlog
Backlog (1) +25.0% ($B) over Total Backlog 4Q21 • Total backlog of $24.1B and 12-month backlog of $13.8B represent record levels as of December 31, 2022 • The increase in backlog is primarily +21.9% attributable to multiple new project awards, over including Colorado Power Pathway Project, 4Q21 and
Slide 13: Free Cash Flow & DSO
Free Cash Flow & DSO 4th Quarter Recap Free Cash Flow (1) ($M) Days Sales Outstanding (2) (DSO) Free Cash Flow increase driven by: 4Q21 4Q22 • 4Q22 cash flow benefited from favorable billing arrangements on certain contracts. Net capital expenditures in 4Q21 included a $50 million opportunistic proc
Slide 14: Balance Sheet & Liquidity
Balance Sheet & Liquidity December 31, ($M) 2019 2020 2021 2022 Liquidity Highlights Cash and Cash Equivalents 165 185 229 429 Debt • Continue to identify and execute on Credit Facility (Revolver) 105 149 450 37 strategic investments and Commercial Paper — — — 373 Term Loans 1,241 — 750 750 acquisit
Slide 15: Electric Power Solutions Segment Guidance
Electric Power Solutions Segment Guidance Estimated Range 2022 △ 2023 Revenues + Base business growth led by continued investments $8.9B supporting grid modernization, hardening $10.0B - $10.1B and reliability Op Inc % (1) + Continued base business 10.7% execution strength 10.7% - 11.3% EXPECTED DOU
Slide 16: Renewable Energy Solutions Segment Guidance
Renewable Energy Solutions Segment Guidance Estimated Range 2022 △ 2023 Revenues + Solid growth compared to $3.8B prior year with ramp in 2H23 $4.3B - $4.5B Op Inc %(1) + Improved margins with higher volumes 8.1% - 1H23 cost absorption ~8.5% pressure with lower revenues EXPECTED ROBUST GROWTH WITH I
Slide 17: Underground Utility & Infrastructure Solutions Segment Guidance
Underground Utility & Infrastructure Solutions Segment Guidance Estimated Range 2022 △ 2023 Revenues - Lower volumes of larger pipeline projects $4.4B + Continued base business $4.1B - $4.3B growth Op Inc % (1) + Continued strong execution 7.3% across our base business 7.25% - 7.75% EXPECTED UPPER S
Slide 18: 2023 Guidance Summary
2023 Guidance Summary Estimated Range ($M except per share data) Low Mid High Revenues $18,400 $18,650 $18,900 Adj. EBITDA (1) $1,825 $1,881 $1,938 Free Cash Flow (2) $750 $875 $1,000 Net Income $692 $729 $766 Diluted EPS (GAAP) $4.67 $4.92 $5.17 Adjusted Diluted EPS (3) $6.75 $7.00 $7.25 ENABLING T
Slide 19: Closing Remarks
Closing Remarks • The infrastructure investment required to support North America's energy transition remains in its early stages, and creates opportunities for Quanta's industry-leading comprehensive, end-to-end solutions • Our relationships and the breadth of our solutions have proven to be critic
Slide 20: Appendix
Appendix • Definitions • Reconciliation Tables • Cautionary Statement About Forward-Looking Statements and Information 20
Slide 21: Definitions
Definitions • Backlog is defined as performance obligations, plus estimated orders under master service agreements, including estimated renewals, and non-fixed price contracts expected to be completed within one year. Quanta’s methodology for determining backlog may not be comparable to the methodol
Slide 22: Definitions
Definitions • Adjusted Earnings per Share is defined as diluted earnings per share adjusted for the after-tax impact of certain other items, in the current year, as described below: ◦ Non-cash stock-based compensation expense varies period to period due to acquisition activity, changes in the estima
Slide 23: Reconciliation of Adjusted Net Income and Adjusted Diluted Earnings per Share
Reconciliation of Adjusted Net Income and Adjusted Diluted Earnings per Share ($000s, except per share information) 2022 FY 2023 GUIDANCE RANGE FY Low Mid High Reconciliation of adjusted net income attributable to common stock: Net income attributable to common stock (GAAP as reported) $ 491,189 $ 6
Slide 24: Reconciliation of EBITDA and Adjusted EBITDA
Reconciliation of EBITDA and Adjusted EBITDA ($000s) 2022 FY 2023 GUIDANCE RANGE FY Low Mid High Net income attributable to common stock (GAAP as reported) $ 491,189 $ 691,700 $ 728,800 $ 765,900 Interest expense, net 121,757 147,000 150,000 153,000 Provision for income taxes 192,243 246,900 263,650
Slide 25: Reconciliation of Free Cash Flow
Reconciliation of Free Cash Flow ($000s) 2021 2022 FY 2023 GUIDANCE RANGE 4Q FY 4Q FY Low Mid High Net cash provided by operating activities (GAAP as reported) $ 249,953 $ 582,390 $ 583,129 $1,130,312 $1,150,000 $1,275,000 $1,400,000 Less: Net capital expenditures: Capital expenditures (152,856) (38
Slide 26: Reconciliation of Backlog
Reconciliation of Backlog ($000s) December 31, 2021 September 30, 2022 December 31, 2022 12 Month Total 12 Month Total 12 Month Total Electric Power Infrastructure Solutions Remaining performance obligations $2,002,862 $2,769,106 $2,207,737 $2,854,847 $2,124,820 $3,033,472 Estimated orders under MSA
Slide 27: Cautionary Statement About Forward-Looking Statements and Information
Cautionary Statement About Forward-Looking Statements and Information 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 Litigatio
Slide 28: Cautionary Statement About Forward-Looking Statements and Information
Cautionary Statement About Forward-Looking Statements and Information • Market, industry, economic, financial or political conditions that are outside of the control of Quanta, including as a result of, among other things, inflation, interest rates, recessionary economic conditions, deterioration or
Slide 29: Cautionary Statement About Forward-Looking Statements and Information
Cautionary Statement About Forward-Looking Statements and Information • Unavailability of, or increased prices for, materials, equipment and consumables (such as fuel) used in Quanta’s or its customers' businesses, including as a result of inflation, supply chain disruptions, governmental regulation
Slide 30: Connect With Quanta Services Investor Relations
Connect With Quanta Services Investor Relations @QuantaIR QuantaServicesIR 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 investors@quantaservices.com www.quantaservices.com 30