NV5 Global, Inc. (Nasdaq: NVEE) ("NV5" or the
"Company"), a provider of technology, conformity
assessment, and consulting solutions, today reported financial
results for the full year ended December 31, 2022.
"We are pleased to have delivered another strong
year for revenues and earnings in 2022, despite significant
headwinds in the commercial economy due to historic interest rate
increases. All three of our reporting segments grew in 2022, with a
record performance by the geospatial business. We also completed
five strategic acquisitions in 2022, strengthening our utility
geospatial, building technology, and materials testing offerings.
We anticipate a successful year in 2023. We enter 2023 with a
strong backlog to drive organic growth and profitability, and we
anticipate the best year for mergers and acquisitions in our
history," said Dickerson Wright, PE, Chairman and CEO of NV5.
Full Year 2022
Financial Highlights
- Gross revenues in
2022 were $786.8 million compared to $706.7 million in 2021, an 11%
increase.
- Net income in 2022
was $50.0 million compared to $47.1 million in 2021, a 6%
increase.
- Adjusted EBITDA in
2022 was $135.2 million compared to $132.9 million in 2021, a 2%
increase.
- GAAP EPS in 2022
was $3.27 per share compared to $3.22 per share in 2021, a 2%
increase.
- Adjusted EPS in
2022 was $5.19 per share compared to $5.11 per share in 2021, a 2%
increase. Diluted weighted average shares outstanding were
15,260,186 in 2022 compared to 14,656,381 in 2021.
- Cash flows from
operating activities in 2022 were $94.0 million compared to $101.4
million in 2021. Cash flows from operations in 2022 included an
income tax payment of $9.4 million as a result of new tax
provisions that require capitalization and amortization of research
and development costs.
Fiscal Year 2023 Guidance
- Gross revenues between $878 million and
$915 million.
- GAAP EPS between $2.93 per share and
$3.33 per share.
- Adjusted EPS between $5.28 and $5.69
per share.
Use of Non-GAAP Financial Measures; Comparability of
Certain Measures
Earnings before interest, taxes, depreciation,
and amortization (“EBITDA”) is not a measure of financial
performance under GAAP. Adjusted EBITDA reflects adjustments to
EBITDA to eliminate stock-based compensation expense and
acquisition-related costs. Management believes adjusted EBITDA, in
addition to operating profit, Net Income, and other GAAP measures,
is a useful indicator of our financial and operating performance
and our ability to generate cash flows from operations that are
available for taxes, capital expenditures, and debt service. A
reconciliation of Net Income, as reported in accordance with GAAP,
to adjusted EBITDA is provided at the end of this news release.
Adjusted earnings per diluted share (“Adjusted
EPS”) is not a measure of financial performance under GAAP.
Adjusted EPS reflects adjustments to reported diluted earnings per
share (“GAAP EPS”) to eliminate amortization expense of intangible
assets from acquisitions and acquisition-related costs, net of tax
benefits. As we continue our acquisition strategy, the growth in
Adjusted EPS may increase at a greater rate than GAAP EPS. A
reconciliation of GAAP EPS to Adjusted EPS is provided at the end
of this news release.
Our definition of Adjusted EBITDA and Adjusted
EPS may differ from other companies reporting similarly named
measures. These measures should be considered in addition to,
and not as a substitute for, or superior to, other measures of
financial performance prepared in accordance with GAAP, such as Net
Income, and Diluted Earnings per Share. In addition, when
presenting forward-looking non-GAAP metrics, we are unable to
provide quantitative reconciliations to the most closely correlated
GAAP measure due to the uncertainty in the timing, amount or nature
of any adjustments, which could be material in any period.
Conference Call
NV5 will host a conference call to discuss its
full year 2022 financial results at 4:30 p.m. (Eastern Time) on
February 23, 2023. The accompanying presentation for the call
is available by visiting http://ir.nv5.com.
Date: |
Thursday,
February 23, 2023 |
Time: |
4:30 p.m. Eastern |
Toll-free dial-in number: |
+1 888-412-4117 |
International dial-in number: |
+1 646-960-0284 |
Conference ID: |
6172299 |
Webcast: |
http://ir.nv5.com |
Please dial-in at least 5-10 minutes prior to
the start time to allow the operator to log your name and connect
you to the conference.
The conference call will be webcast live and
available for replay via the “Investors” section of the NV5
website.
About NV5
NV5 Global, Inc. (NASDAQ: NVEE) is a provider of
technology, conformity assessment, and consulting solutions for
public and private sector clients supporting sustainable
infrastructure, utility, and building assets and systems. The
Company focuses on multiple verticals: testing, inspection &
consulting, infrastructure engineering, utility services, buildings
& program management, environmental health sciences, and
geospatial technology services to deliver innovative, sustainable
solutions to complex issues and improve lives in our communities.
NV5 operates out of more than 100 offices nationwide and
internationally. For additional information, please visit the
Company’s website at www.NV5.com. Also visit the Company on
LinkedIn, Twitter, Facebook, and Instagram.
Forward-Looking Statements
This news release contains “forward-looking
statements” within the meaning of the safe harbor provisions of the
U.S. Private Securities Litigation Reform Act of 1995. The Company
cautions that these statements are qualified by important factors
that could cause actual results to differ materially from those
reflected by the forward-looking statements contained in this news
release and on the conference call. Such factors include: (a)
changes in demand from the local and state government and private
clients that we serve; (b) general economic conditions, nationally
and globally, and their effect on the market for our services; (c)
competitive pressures and trends in our industry and our ability to
successfully compete with our competitors; (d) changes in laws,
regulations, or policies; and (e) the “Risk Factors” set forth in
the Company’s most recent SEC filings. All forward-looking
statements are based on information available to the Company on the
date hereof, and the Company assumes no obligation to update such
statements, except as required by law.
Investor Relations Contact
NV5 Global, Inc.Jack CochranVice President, Marketing &
Investor RelationsTel: +1-954-637-8048Email: ir@nv5.com
Source: NV5 Global, Inc.
NV5 GLOBAL, INC. AND
SUBSIDIARIESCONSOLIDATED BALANCE
SHEETS(UNAUDITED) (in thousands, except share data)
|
December 31, 2022 |
|
January 1, 2022 |
Assets |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
38,541 |
|
$ |
47,980 |
Billed receivables, net |
|
145,637 |
|
|
153,814 |
Unbilled receivables, net |
|
92,862 |
|
|
89,734 |
Prepaid expenses and other current assets |
|
13,636 |
|
|
12,442 |
Total current assets |
|
290,676 |
|
|
303,970 |
Property and equipment,
net |
|
41,640 |
|
|
32,729 |
Right-of-use lease assets,
net |
|
39,314 |
|
|
44,260 |
Intangible assets, net |
|
160,431 |
|
|
188,224 |
Goodwill |
|
400,957 |
|
|
389,916 |
Other assets |
|
2,705 |
|
|
2,844 |
Total Assets |
$ |
935,723 |
|
$ |
961,943 |
|
|
|
|
Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
57,771 |
|
$ |
55,954 |
Accrued liabilities |
|
44,313 |
|
|
50,461 |
Billings in excess of costs and estimated earnings on uncompleted
contracts |
|
31,183 |
|
|
29,444 |
Other current liabilities |
|
1,597 |
|
|
1,551 |
Current portion of contingent consideration |
|
10,854 |
|
|
5,807 |
Current portion of notes payable and other obligations |
|
15,176 |
|
|
20,734 |
Total current liabilities |
|
160,894 |
|
|
163,951 |
Contingent consideration, less
current portion |
|
4,481 |
|
|
2,521 |
Other long-term
liabilities |
|
29,542 |
|
|
34,304 |
Notes payable and other
obligations, less current portion |
|
39,673 |
|
|
111,062 |
Deferred income tax
liabilities, net |
|
6,893 |
|
|
25,385 |
Total liabilities |
|
241,483 |
|
|
337,223 |
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
Stockholders’ equity: |
|
|
|
Preferred stock, $0.01 par value; 5,000,000 shares authorized, no
shares issued and outstanding |
|
— |
|
|
— |
Common stock, $0.01 par value; 45,000,000 shares authorized,
15,523,300 and 15,414,005 shares issued and outstanding as of
December 31, 2022 and January 1, 2022, respectively |
|
155 |
|
|
154 |
Additional paid-in capital |
|
471,300 |
|
|
451,754 |
Retained earnings |
|
222,785 |
|
|
172,812 |
Total stockholders’ equity |
|
694,240 |
|
|
624,720 |
Total liabilities and stockholders’ equity |
$ |
935,723 |
|
$ |
961,943 |
|
|
|
|
|
|
NV5 GLOBAL, INC. AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF NET INCOME AND
COMPREHENSIVE INCOME(UNAUDITED)(in thousands, except share
data)
|
Three Months Ended |
|
Twelve Months Ended |
|
December 31, 2022 |
|
January 1, 2022 |
|
December 31, 2022 |
|
January 1, 2022 |
Gross revenues |
$ |
189,818 |
|
|
$ |
188,555 |
|
|
$ |
786,778 |
|
|
$ |
706,706 |
|
|
|
|
|
|
|
|
|
Direct
costs: |
|
|
|
|
|
|
|
Salaries and wages |
|
44,830 |
|
|
|
43,417 |
|
|
|
186,806 |
|
|
|
175,047 |
|
Sub-consultant services |
|
37,084 |
|
|
|
35,995 |
|
|
|
153,641 |
|
|
|
124,998 |
|
Other direct costs |
|
14,931 |
|
|
|
11,633 |
|
|
|
60,357 |
|
|
|
47,347 |
|
Total direct costs |
|
96,845 |
|
|
|
91,045 |
|
|
|
400,804 |
|
|
|
347,392 |
|
|
|
|
|
|
|
|
|
Gross
profit |
|
92,973 |
|
|
|
97,510 |
|
|
|
385,974 |
|
|
|
359,314 |
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
Salaries and wages, payroll
taxes, and benefits |
|
46,769 |
|
|
|
45,077 |
|
|
|
193,488 |
|
|
|
176,838 |
|
General and
administrative |
|
18,501 |
|
|
|
16,095 |
|
|
|
66,114 |
|
|
|
53,986 |
|
Facilities and facilities
related |
|
5,431 |
|
|
|
4,863 |
|
|
|
21,252 |
|
|
|
20,193 |
|
Depreciation and
amortization |
|
9,565 |
|
|
|
10,189 |
|
|
|
38,938 |
|
|
|
39,953 |
|
Total operating expenses |
|
80,266 |
|
|
|
76,224 |
|
|
|
319,792 |
|
|
|
290,970 |
|
|
|
|
|
|
|
|
|
Income from
operations |
|
12,707 |
|
|
|
21,286 |
|
|
|
66,182 |
|
|
|
68,344 |
|
|
|
|
|
|
|
|
|
Interest
expense |
|
(1,005 |
) |
|
|
(878 |
) |
|
|
(3,808 |
) |
|
|
(6,239 |
) |
|
|
|
|
|
|
|
|
Income before income tax
expense |
|
11,702 |
|
|
|
20,408 |
|
|
|
62,374 |
|
|
|
62,105 |
|
Income tax expense |
|
(3,702 |
) |
|
|
(4,953 |
) |
|
|
(12,401 |
) |
|
|
(14,958 |
) |
Net income and
comprehensive income |
$ |
8,000 |
|
|
$ |
15,455 |
|
|
$ |
49,973 |
|
|
$ |
47,147 |
|
|
|
|
|
|
|
|
|
Earnings per
share: |
|
|
|
|
|
|
|
Basic |
$ |
0.54 |
|
|
$ |
1.05 |
|
|
$ |
3.39 |
|
|
$ |
3.34 |
|
Diluted |
$ |
0.52 |
|
|
$ |
1.02 |
|
|
$ |
3.27 |
|
|
$ |
3.22 |
|
|
|
|
|
|
|
|
|
Weighted average
common shares outstanding: |
|
|
|
|
|
|
|
Basic |
|
14,816,773 |
|
|
|
14,651,218 |
|
|
|
14,753,738 |
|
|
|
14,135,333 |
|
Diluted |
|
15,320,123 |
|
|
|
15,159,314 |
|
|
|
15,260,186 |
|
|
|
14,656,381 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
NV5 GLOBAL, INC. AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF CASH
FLOWS(UNAUDITED)(in thousands)
|
Twelve Months Ended |
|
December 31, 2022 |
|
January 1, 2022 |
Cash flows from
operating activities: |
|
|
|
Net income |
$ |
49,973 |
|
|
$ |
47,147 |
|
Adjustments to reconcile net
income to net cash provided by operating activities: |
|
|
|
Depreciation and amortization |
|
44,063 |
|
|
|
44,971 |
|
Non-cash lease expense |
|
12,813 |
|
|
|
10,191 |
|
Provision for doubtful accounts |
|
(60 |
) |
|
|
1,243 |
|
Stock-based compensation |
|
19,326 |
|
|
|
16,301 |
|
Change in fair value of contingent consideration |
|
2,972 |
|
|
|
2,333 |
|
Gain on disposals of property and equipment |
|
(328 |
) |
|
|
(1,102 |
) |
Deferred income taxes |
|
(18,492 |
) |
|
|
(7,007 |
) |
Amortization of debt issuance costs |
|
724 |
|
|
|
1,210 |
|
Changes in operating assets
and liabilities, net of impact of acquisitions: |
|
|
|
Billed receivables |
|
10,212 |
|
|
|
2,677 |
|
Unbilled receivables |
|
(3,303 |
) |
|
|
(12,573 |
) |
Prepaid expenses and other assets |
|
(1,125 |
) |
|
|
(4,792 |
) |
Accounts payable |
|
(1,673 |
) |
|
|
8,181 |
|
Accrued liabilities and other long-term liabilities |
|
(19,901 |
) |
|
|
(12,507 |
) |
Contingent consideration |
|
(800 |
) |
|
|
— |
|
Billings in excess of costs and estimated earnings on uncompleted
contracts |
|
(296 |
) |
|
|
4,005 |
|
Other current liabilities |
|
(125 |
) |
|
|
1,164 |
|
Net cash provided by operating
activities |
|
93,980 |
|
|
|
101,442 |
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
Cash paid for acquisitions
(net of cash received from acquisitions) |
|
(5,908 |
) |
|
|
(67,995 |
) |
Proceeds from sale of
assets |
|
87 |
|
|
|
1,639 |
|
Purchase of property and
equipment |
|
(15,689 |
) |
|
|
(13,903 |
) |
Net cash used in investing
activities |
|
(21,510 |
) |
|
|
(80,259 |
) |
|
|
|
|
Cash flows from
financing activities: |
|
|
|
Borrowings from Senior Credit
Facility |
|
— |
|
|
|
138,750 |
|
Proceeds from common stock
offering |
|
— |
|
|
|
172,500 |
|
Payments of borrowings from
Senior Credit Facility |
|
(65,000 |
) |
|
|
(323,832 |
) |
Payments on notes payable |
|
(15,445 |
) |
|
|
(12,516 |
) |
Payments of contingent
consideration |
|
(1,464 |
) |
|
|
(1,329 |
) |
Payments of common stock
offering costs |
|
— |
|
|
|
(10,657 |
) |
Payments of debt issuance
costs |
|
— |
|
|
|
(976 |
) |
Purchases of common stock
tendered by employees to satisfy the required withholding taxes
related to stock-based compensation |
|
— |
|
|
|
(52 |
) |
Net cash used in financing
activities |
|
(81,909 |
) |
|
|
(38,112 |
) |
|
|
|
|
Net decrease in cash
and cash equivalents |
|
(9,439 |
) |
|
|
(16,929 |
) |
Cash and cash
equivalents – beginning of period |
|
47,980 |
|
|
|
64,909 |
|
Cash and cash
equivalents – end of period |
$ |
38,541 |
|
|
$ |
47,980 |
|
|
|
|
|
|
|
|
|
NV5 GLOBAL, INC. AND
SUBSIDIARIESRECONCILIATION OF GAAP FINANCIAL MEASURES TO
COMPARABLE NON-GAAP FINANCIAL MEASURES(UNAUDITED)(in thousands,
except share data)
RECONCILIATION OF GAAP NET INCOME TO ADJUSTED
EBITDA
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
December 31, 2022 |
|
January 1, 2022 |
|
December 31, 2022 |
|
January 1, 2022 |
Net
Income |
$ |
8,000 |
|
$ |
15,455 |
|
$ |
49,973 |
|
$ |
47,147 |
Add: |
Interest expense |
|
1,005 |
|
|
878 |
|
|
3,808 |
|
|
6,239 |
|
Income tax expense |
|
3,702 |
|
|
4,953 |
|
|
12,401 |
|
|
14,958 |
|
Depreciation and
amortization |
|
10,972 |
|
|
11,574 |
|
|
44,063 |
|
|
44,971 |
|
Stock-based compensation |
|
4,077 |
|
|
4,214 |
|
|
19,326 |
|
|
16,301 |
|
Acquisition-related
costs* |
|
4,720 |
|
|
2,667 |
|
|
5,612 |
|
|
3,274 |
Adjusted
EBITDA |
$ |
32,476 |
|
$ |
39,741 |
|
$ |
135,183 |
|
$ |
132,890 |
* Acquisition-related costs include contingent consideration
fair value adjustments.
RECONCILIATION OF GAAP EPS TO ADJUSTED EPS
|
|
Three Months Ended |
|
Twelve Months Ended |
|
|
December 31, 2022 |
|
January 1, 2022 |
|
December 31, 2022 |
|
January 1, 2022 |
Net Income
- per diluted share |
$ |
0.52 |
|
|
$ |
1.02 |
|
|
$ |
3.27 |
|
|
$ |
3.22 |
|
Per
diluted share adjustments: |
|
|
|
|
|
|
|
Add: |
Amortization expense of intangible assets |
|
0.52 |
|
|
|
0.56 |
|
|
|
2.12 |
|
|
|
2.29 |
|
|
Acquisition-related
costs* |
|
0.30 |
|
|
|
0.18 |
|
|
|
0.36 |
|
|
|
0.22 |
|
|
Income tax expense |
|
(0.13 |
) |
|
|
(0.15 |
) |
|
|
(0.56 |
) |
|
|
(0.62 |
) |
Adjusted
EPS |
$ |
1.21 |
|
|
$ |
1.61 |
|
|
$ |
5.19 |
|
|
$ |
5.11 |
|
* Acquisition-related costs include contingent consideration
fair value adjustments.
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