Comfort Systems Usa, Inc. · NYSE:FIX
Comfort Systems Usa — Investor Presentation (March 2020)
21 slides from Comfort Systems Usa's investor presentation, Mar 6, 2020
Slide 1: Quality People. Building Solutions.
Quality People. Building Solutions. NYSE: FIX March 6, 2020
Slide 2: Safe Harbor / Non-GAAP Measures
SAFE HARBOR Certain statements and information in this presentation may constitute forward-looking statements regarding our future business expectations, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, as amended. The words “believe,” “expect,
Slide 3: Comfort Systems USA
Comfort Systems USA • Leading mid-market mechanical, electrical and plumbing (“MEP”) installation and service provider • $2.6B yearly revenue • 12,000 employees • 35 operating companies • Balanced construction & service portfolio 2
Slide 4: National Footprint
National Footprint 134 locations | 115 cities | 12,000 employees 3
Slide 5: Investment Thesis
Investment Thesis • Strong free cash flow and low capital requirements • Consistent Capital allocation • Multiple opportunities for growth • Strong Balance Sheet • Record of accretive acquisitions 4
Slide 6: Our Markets
Our Markets Every Building You See … Light Heavy Light Heavy Residential Commercial Industrial Commercial Commercial Industrial Industrial … Needs What We Do 5
Slide 7: Revenue Breakdown
Revenue Breakdown Activity Market Sector FY2019 Revenue = $2.62B Retail / Restaurant / Entertainment Health Care 9% 9% 14% Other 8% 30% 15% Education Office Building 16% 13% Government 6% 46% Industrial 34% New Construction Existing Building Construction Service Projects Service Calls, Maintenance &
Slide 8: Diverse Project Mix
Diverse Project Mix Number of Projects 5,000 4,734 4,500 4,000 3,500 3,000 2,500 2,000 1,500 1,000 580 500 133 48 0 <$1M $1–$5M $5-$15M >$15M Average Project Size: $0.8 M | Average Project Length: 6 – 9 months (Information as of December 31, 2019) 7
Slide 9: Construction Backlog
Construction Backlog ($ in millions) $1,600 $1,400 $1,200 $1,000 $800 $600 $400 $200 $763 $948 $1,166 $1,602 $0 2016 2017 2018 2019 8
Slide 10: Service Maintenance Base
Service Maintenance Base ($ in millions) $125 $100 $75 $50 $25 $111 $116 $123 $127 $0 2016 2017 2018 2019 9
Slide 11: Recent Financial Performance
Recent Financial Performance Three Months Ended Twelve Months Ended ($ in millions, except per share information) 12/31/19 12/31/18 12/31/19 12/31/18 Revenue $719.6 $588.4 $2,615.3 $2,182.9 Net Income $34.1 $25.2 $114.3 $112.9 Diluted EPS $0.92 $0.67 $3.08 $3.00 Adjusted EPS (1) $0.92 $0.67 $3.08 $2
Slide 12: Historical Financial Summary
Historical Financial Summary ($ in millions, except per share information) Revenue Adjusted EPS (1) CAGR = 16.97% CAGR = 21.43% $3,000 $3.60 $2,700 $3.20 $2,400 $2.80 $2,100 $2.40 $1,800 $2.00 $1,500 $1.60 $1,200 $900 $1.20 $600 $0.80 $300 $0.40 $0 $0.00 2016 2017 2018 2019 2016 2017 2018 2019 Opera
Slide 13: Adjusted EPS/Stock Price History
Adjusted EPS/Stock Price History $3.50 $60.00 $3.00 $50.00 $2.50 $40.00 Stock Price at 12 / 31 Adjusted EPS at 12/31* $2.00 $30.00 ` $1.50 $20.00 $1.00 $10.00 $0.50 $- $- 2014 2015 2016 2017 2018 2019 Adjusted EPS at 12/31* Stock Price at 12/31 *Adjusted EPS is a non-GAAP financial measure. Adjusted
Slide 14: Focus on Cash Flow
Focus on Cash Flow • Positive free cash flow for 21 consecutive years • Increased dividend for 7 consecutive years • Debt/TTM EBITDA = 1.06 • $50.8M cash at December 31, 2019 • $226.1M total debt at December 31, 2019 • Debt capacity – $178.0M borrowings at 12/31/19 – $600M senior credit facility – 2
Slide 15: Earnings Profile for Growth
Profile for Growth Earnings Time 14
Slide 16: Consistent Capital Allocation
Consistent Capital Allocation ($ in thousands) Average 2006 - 2019 $8,749 13% $10,906 17% $45,034 70% Acquisitions Share Repurchases Dividends $70,000 $64,689 $60,000 $56,273 $50,000 $40,000 $30,000 $20,000 $10,000 $- Free Cash Flow Disc Spending 15
Slide 17: Our Strengths
Our Strengths • Consistent free cash flow • Strong Balance Sheet • Acquisition record • Leading innovation • Positioned for growth 16
Slide 18: Thank You
Thank You 12,000 Employees 12,000 of the most qualified HVAC and electrical contracting personnel in America 134 Locations $2.6 Billion 35 operating companies across America at $2.6 billion in yearly revenue 134 locations in 115 cities Contact: Bill George Executive Vice President & CFO 1-800-723-84
Slide 19: Appendix I – GAAP Reconciliation to Adjusted EBITDA
Appendix I – GAAP Reconciliation to Adjusted EBITDA Three Months Ended December 31, Twelve Months Ended December 31, ($ in thousands) 2019 2018 2019 2018 Net Income $34,052 $25,156 $114,324 $112,903 Provision for Income Taxes 11,079 9,307 37,418 35,773 Other (Income) Expense, net (20) (79) (187) (4,
Slide 20: Appendix II – GAAP Reconciliation to Adjusted EBITDA
Appendix II – GAAP Reconciliation to Adjusted EBITDA (Historical) Year Ended December 31, ($ in thousands) 2014 2015 2016 2017 2018 2019 Net Income Including Non-controlling $28,599 $57,440 $64,896 $55,272 $112,903 $114,324 Interests Discontinued Operations 15 - - - - - Provision for Income Taxes 11
Slide 21: Appendix III – GAAP Reconciliation to Adjusted EPS
Appendix III – GAAP Reconciliation to Adjusted EPS (Historical) Year Ended December 31, 2014 2015 2016 2017 2018 2019 Diluted income per share from continuing operations attributable to $0.61 $1.30 $1.72 $1.47 $3.00 $3.08 Comfort Systems USA, Inc. Goodwill impairment 0.01 - - 0.02 - - Tax valuation
Comfort Systems USA — Investor Presentation (March 2020) on 6ix