- Record First Quarter Revenues of $2.30
billion - - Record First Quarter Diluted EPS of $1.54, 14.1%
Increase Year-over-Year - - Record Remaining Performance
Obligations of $4.78 billion, 7.9% Increase Year-over-Year - -
Increases 2021 Diluted EPS Guidance Range to $6.35 - $6.75 from
$6.20 - $6.70 -
EMCOR Group, Inc. (NYSE: EME) today reported results for the
first quarter ended March 31, 2021.
For the first quarter of 2021, net income was $84.8 million, or
$1.54 per diluted share, compared to $75.7 million, or $1.35 per
diluted share, for the first quarter of 2020. Revenues for the
first quarter of 2021 totaled $2.30 billion, up 0.2% from the year
ago period.
Operating income for the first quarter of 2021 was $117.0
million, or 5.1% of revenues. This compared to $106.0 million, or
4.6% of revenues, for the first quarter of 2020.
Selling, general and administrative expenses for the first
quarter of 2021 totaled $224.1 million, or 9.7% of revenues,
compared to $227.0 million, or 9.9% of revenues, for the first
quarter of 2020.
The Company's income tax rate for the first quarter of 2021 was
27.2% compared to an income tax rate of 27.4% for the first quarter
of 2020.
Remaining performance obligations as of March 31, 2021 were
$4.78 billion compared to $4.42 billion as of March 31, 2020. Total
remaining performance obligations grew approximately $351.3 million
year-over-year.
Tony Guzzi, Chairman, President and Chief Executive Officer of
EMCOR, commented, “The Company had an outstanding start to the
year, achieving record first quarter revenues, gross profit, gross
profit margin, operating income, operating income margin, net
income, and diluted earnings per share. Our focus on executing for
our customers allowed us to deliver a robust operating income
margin of 5.1%, up 50 basis points year-over-year. Additionally, we
continue to see a healthy project pipeline as evidenced by our
record remaining performance obligations of $4.78 billion, which
increased 7.9% year-over-year.”
Mr. Guzzi added, “Our U.S. Construction segments continue to
deliver outstanding results, posting combined revenue and operating
income growth of 5.0% and 23.1% year-over-year, respectively, led
by our U.S. Mechanical Construction segment in particular, which
delivered revenue growth of 8.4% year-over-year and operating
income growth of 43.8% year-over-year. U.S. Building Services
performed exceptionally well, generating revenue and operating
income growth of 10.3% and 38.0%, respectively, driven primarily by
our commercial site-based and mobile mechanical services
businesses. Our U.S. Industrial Services segment experienced a
difficult quarter as the Texas Freeze impacted our turnaround
schedule, but we remain well-positioned to assist our customers
when the market strengthens. Lastly, our U.K. Building Services
segment continued to take advantage of strong project demand,
delivering revenue and operating income growth of 12.8% and 63.3%,
respectively, which led to operating margin expansion of 230 basis
points year-over-year.”
Based on year-to-date performance and assuming a gradual
improvement of current market conditions as the year progresses,
EMCOR is raising its full-year 2021 diluted earnings per share
guidance range to $6.35 to $6.75, an increase from the prior
guidance range of $6.20 to $6.70. The Company is maintaining its
full-year 2021 revenue guidance of $9.2 billion to $9.4
billion.
Mr. Guzzi concluded, “We are optimistic about our prospects for
the remainder of the year. Our values of Mission First, People
Always will continue to guide us as we focus on the health and
safety of our employees, while executing our work for our customers
with excellence. Looking ahead, we will continue to invest in our
business and pursue strategic acquisition opportunities, while also
returning capital to shareholders through share repurchases and
dividends.”
EMCOR Group, Inc. is a Fortune 500 leader in mechanical and
electrical construction services, industrial and energy
infrastructure and building services. This press release and other
press releases may be viewed at the Company’s website at
www.emcorgroup.com. EMCOR routinely
posts information that may be important to investors in the
“Investor Relations” section of our website at www.emcorgroup.com. Investors and potential
investors are encouraged to consult the EMCOR website regularly for
important information about EMCOR.
EMCOR Group's first quarter conference call will be available
live via internet broadcast today, Thursday, April 29, at 10:30 AM
Eastern Daylight Time. The live call may be accessed through the
Company's website at www.emcorgroup.com.
Forward Looking Statements:
This release contains certain forward-looking statements. Any
such comments speak only as of April 29, 2021 and EMCOR assumes no
obligation to update any such forward-looking statements, unless
required by law. These forward-looking statements may include
statements regarding anticipated future operating and financial
performance, the nature and impact of our remaining performance
obligations, our ability to pursue acquisitions, our ability to
return capital to shareholders, market opportunities, market growth
and customer trends. These forward-looking statements involve risks
and uncertainties that could cause actual results to differ
materially from those anticipated (whether expressly or implied) by
the forward-looking statements. Accordingly, these statements are
no guarantee of future performance. Such risks and uncertainties
include, but are not limited to, adverse effects of general
economic conditions, changes in the political environment, changes
in the specific markets for EMCOR’s services, adverse business
conditions, availability of adequate levels of surety bonding,
increased competition, unfavorable labor productivity, mix of
business, and the impact of the COVID-19 pandemic on our revenue
and operations, including employees, construction activity, and
facilities utilization, and certain of the risk factors associated
with EMCOR’s business discussed in Part I, Item 1A “Risk Factors,”
of the Company’s 2020 Form 10-K, and in other reports filed from
time to time with the Securities and Exchange Commission and
available at www.sec.gov and
www.emcorgroup.com. Such risk factors
should be taken into account in evaluating any forward-looking
statements.
EMCOR GROUP, INC.
FINANCIAL HIGHLIGHTS CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except share and
per share information)
(Unaudited)
For the three months ended
March 31,
2021
2020
Revenues
$
2,304,049
$
2,299,832
Cost of sales
1,962,976
1,966,771
Gross profit
341,073
333,061
Selling, general and administrative
expenses
224,069
226,997
Restructuring expenses
—
69
Operating income
117,004
105,995
Net periodic pension (cost) income
908
742
Interest expense, net
(1,363)
(2,488)
Income before income taxes
116,549
104,249
Income tax provision
31,604
28,584
Net income including noncontrolling
interests
84,945
75,665
Less: Net income attributable to
noncontrolling interests
(171)
—
Net income attributable to EMCOR Group,
Inc.
$
84,774
$
75,665
Basic earnings per common share
$
1.54
$
1.35
Diluted earnings per common share
$
1.54
$
1.35
Weighted average shares of common stock
outstanding:
Basic
54,896,548
56,007,122
Diluted
55,135,304
56,210,728
Dividends declared per common share
$
0.13
$
0.08
EMCOR GROUP, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands)
March 31, 2021
(Unaudited)
December 31,
2020
ASSETS
Current assets:
Cash and cash equivalents
$
758,833
$
902,867
Accounts receivable, net
2,037,525
1,922,096
Contract assets
192,369
171,956
Inventories
48,212
53,338
Prepaid expenses and other
68,692
70,679
Total current assets
3,105,631
3,120,936
Property, plant and equipment, net
157,202
158,427
Operating lease right-of-use assets
239,457
242,155
Goodwill
862,323
851,783
Identifiable intangible assets, net
580,555
582,893
Other assets
116,021
107,646
Total assets
$
5,061,189
$
5,063,840
LIABILITIES AND EQUITY
Current liabilities:
Current maturities of long-term debt and
finance lease liabilities
$
16,713
$
16,910
Accounts payable
624,884
671,886
Contract liabilities
739,572
722,252
Accrued payroll and benefits
384,942
450,955
Other accrued expenses and liabilities
272,942
247,597
Operating lease liabilities, current
54,354
53,632
Total current liabilities
2,093,407
2,163,232
Long-term debt and finance lease
liabilities
259,714
259,619
Operating lease liabilities, long-term
201,894
205,362
Other long-term obligations
385,502
382,383
Total liabilities
2,940,517
3,010,596
Equity:
Total EMCOR Group, Inc. stockholders’
equity
2,119,968
2,052,668
Noncontrolling interests
704
576
Total equity
2,120,672
2,053,244
Total liabilities and equity
$
5,061,189
$
5,063,840
EMCOR GROUP, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
For the Three Months Ended March
31, 2021 and 2020
(In thousands) (Unaudited)
2021
2020
Cash flows - operating activities:
Net income including noncontrolling
interests
$
84,945
$
75,665
Adjustments to reconcile net income to net
cash used in operating activities:
Depreciation and amortization
12,001
11,767
Amortization of identifiable intangible
assets
14,989
14,747
Provision for credit losses
507
2,614
Deferred income taxes
14
4,375
Non-cash share-based compensation
expense
3,193
3,291
Other reconciling items
(739)
42
Changes in operating assets and
liabilities, excluding the effect of businesses acquired
(203,899)
(191,314)
Net cash used in operating
activities
(88,989)
(78,813)
Cash flows - investing activities:
Payments for acquisitions of businesses,
net of cash acquired
(24,326)
(2,582)
Proceeds from sale or disposal of
property, plant and equipment
766
196
Purchases of property, plant and
equipment
(8,204)
(12,035)
Net cash used in investing
activities
(31,764)
(14,421)
Cash flows - financing activities:
Proceeds from revolving credit
facility
—
200,000
Repayments of revolving credit
facility
—
(50,000)
Proceeds from long-term debt
—
300,000
Repayments of long-term debt and debt
issuance costs
—
(257,549)
Repayments of finance lease
liabilities
(1,145)
(1,277)
Dividends paid to stockholders
(7,121)
(4,500)
Repurchases of common stock
(12,917)
(99,048)
Taxes paid related to net share
settlements of equity awards
(3,750)
(2,492)
Issuances of common stock under employee
stock purchase plan
1,731
1,638
Payments for contingent consideration
arrangements
(693)
(653)
Distributions to noncontrolling
interests
(43)
—
Net cash (used in) provided by
financing activities
(23,938)
86,119
Effect of exchange rate changes on
cash, cash equivalents, and restricted cash
886
(4,678)
Decrease in cash, cash equivalents, and
restricted cash
(143,805)
(11,793)
Cash, cash equivalents, and restricted
cash at beginning of year (1)
903,562
359,920
Cash, cash equivalents, and restricted
cash at end of period (2)
$
759,757
$
348,127
_________
(1)
Includes $0.7 million and $1.1
million of restricted cash classified as “Prepaid expenses and
other” in the Consolidated Balance Sheets as of December 31, 2020
and 2019, respectively.
(2)
Includes $0.9 million and $1.0
million of restricted cash classified as “Prepaid expenses and
other” in the Consolidated Balance Sheets as of March 31, 2021 and
2020, respectively.
EMCOR GROUP, INC.
SEGMENT INFORMATION
(In thousands) (Unaudited)
For the three months ended
March 31,
2021
2020
Revenues from unrelated
entities:
United States electrical construction and
facilities services
$
456,168
$
461,803
United States mechanical construction and
facilities services
903,925
834,112
United States building services
581,839
527,611
United States industrial services
235,382
363,929
Total United States operations
2,177,314
2,187,455
United Kingdom building services
126,735
112,377
Total operations
$
2,304,049
$
2,299,832
For the three months ended
March 31,
2021
2020
Operating income (loss):
United States electrical construction and
facilities services
$
40,264
$
40,312
United States mechanical construction and
facilities services
64,950
45,171
United States building services
29,334
21,261
United States industrial services
(2,443)
15,425
Total United States operations
132,105
122,169
United Kingdom building services
9,411
5,764
Corporate administration
(24,512)
(21,869)
Restructuring expenses
—
(69)
Total operations
117,004
105,995
Other corporate items:
Net periodic pension (cost) income
908
742
Interest expense, net
(1,363)
(2,488)
Income before income taxes
$
116,549
$
104,249
View source
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R. Kevin Matz Executive Vice President Shared Services (203)
849-7938 FTI Consulting, Inc. Investors: Haskel Kwestel (212)
850-5646
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