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MasTec Announces Second Quarter 2016 Results Above Expectations and Increases 2016 Full Year Guidance

- Q2 Revenue Increased 15.5% Over Prior Year

- Q2 Results Significantly Above Expectations

- Q2 Backlog Increased 31% Over Prior Year To $5.3 Billion

- Full Year 2016 Guidance Increased

CORAL GABLES, Fla., Aug. 4, 2016 /PRNewswire/ -- MasTec, Inc. (NYSE:MTZ) today announced second quarter 2016 financial results, as well as increased 2016 full year guidance. The Company reported:

  • Second quarter 2016 revenue was $1.23 billion compared to $1.07 billion in the same period in 2015. GAAP net income was $24.4 million, or $0.30 per diluted share, compared to a net loss of $3.8 million, or a loss of $0.05 per diluted share, in the second quarter of 2015.
  • Second quarter 2016 adjusted net income, a non-GAAP measure, was $29.9 million compared to $8.1 million in the same period in 2015. Second quarter 2016 adjusted diluted earnings per share, a non-GAAP measure, was $0.36, compared to $0.10 in the same period last year. Second quarter 2016 adjusted diluted earnings per share, a non-GAAP measure, of $0.36 exceeded the high end of the company's previously announced second quarter 2016 guidance range by $0.09 per share.
  • Second quarter 2016 adjusted EBITDA, also a non-GAAP measure, was $104 million compared to $71 million in the same period in 2015.
  • 18-month backlog as of June 30, 2016 was $5.3 billion, compared to $4.1 billion as of June 30, 2015, a 31% increase.
  • The Company increased 2016 full year revenue guidance to approximately $5.0 billion. The Company also increased 2016 full year guidance expectations to GAAP net income of approximately $112 million, or $1.36 per diluted share, adjusted net income of approximately $129 million or $1.57 per adjusted diluted share and adjusted EBITDA of approximately $440 million.

Adjusted net income, adjusted diluted earnings per share and adjusted EBITDA, all non-GAAP measures, exclude certain items which are detailed and reconciled to the most comparable GAAP-reported measures in the attached Supplemental Disclosures and Reconciliation of Non-GAAP Disclosures.

Jose R. Mas
, MasTec's Chief Executive Officer, commented, "Our second quarter results significantly exceeded our expectations, primarily due to improved productivity in our Oil & Gas segment. We expect record levels of Oil & Gas segment revenue during the second half of 2016 as we further ramp execution on large projects initiated at varying times during the 2016 second quarter. Most importantly, we have clear visibility to opportunities in the Oil & Gas segment which we expect will drive continued growth in 2017 and beyond."

Mr. Mas continued, "It is also important to note that in addition to the strong 2016 second quarter performance in our Oil & Gas segment, we also experienced significant growth in our Communications segment, and began to see improvement, as expected, in our Electrical Transmission segment. We expect these positive trends to continue, driving improved revenue and operating margin performance during the second half of 2016."

George Pita
, MasTec Executive Vice President and CFO, added, "We enter the second half of 2016 with a strong balance sheet and capital structure, excellent working capital metrics and ample liquidity. These factors leave us well positioned to take advantage of the significant growth opportunities in the various markets we serve".

Based on information available today, the Company is raising full year 2016 guidance and providing initial third quarter 2016 guidance. The Company currently estimates 2016 annual revenue to approximate $5.0 billion. 2016 annual GAAP net income is expected to approximate $112 million with adjusted EBITDA, a non-GAAP measure, estimated to approximate $440 million. 2016 annual GAAP diluted earnings per share is estimated to approximate $1.36, with adjusted diluted earnings per share, a non-GAAP measure, estimated to approximate $1.57.

Additionally, for the third quarter of 2016, the Company expects revenue to approximate $1.5 billion. Third quarter 2016 GAAP net income is expected to approximate $52 million with adjusted EBITDA, a non-GAAP measure, estimated to approximate $155 million. Third quarter 2016 GAAP diluted earnings per share is expected to approximate $0.64, with adjusted diluted earnings per share, a non-GAAP measure, estimated at approximate $0.69.

Management will hold a conference call to discuss these results on Friday, August 5, 2016, at 9:00 a.m. Eastern time. The call-in number for the conference call is (913) 312-0664 and the replay number is (719) 457-0820, with a pass code of 9184746. The replay will run for 30 days. Additionally, the call will be broadcast live over the Internet and can be accessed and replayed through the investor relations section of the Company's website at www.mastec.com.

Summary financial statements for the quarters are as follows:

Condensed Unaudited Consolidated Statements of Operations

(In thousands, except per share amounts)







For the Three Months Ended

June 30,



For the Six Months Ended

June 30,





2016



2015



2016



2015



















Revenue

$

1,232,404

$

1,066,629

$

2,206,630

$

2,069,896

Costs of revenue, excluding depreciation and amortization



1,068,182



945,947



1,952,583



1,832,361

Depreciation and amortization



40,657



43,254



79,664



85,852

General and administrative expenses



67,852



69,250



127,900



143,279

Interest expense, net



12,639



12,907



24,797



23,880

Equity in (earnings) losses of unconsolidated affiliates



(489)



2,638



(3,555)



3,223

Other expense (income), net



1,524



(4,991)



(11,830)



(5,583)

Income (loss) before income taxes

$

42,039



(2,376)



37,071



(13,116)

(Provision for) benefit from income taxes



(17,601)



(1,444)



(15,514)



2,908

Net income (loss)

$

24,438

$

(3,820)

$

21,557

$

(10,208)

Net income (loss) attributable to non-controlling interests



350



(120)



162



(245)

Net income (loss) attributable to MasTec, Inc.

$

24,088

$

(3,700)

$

21,395

$

(9,963)



















Earnings per share:

















Basic earnings (loss) per share

$

0.30

$

(0.05)

$

0.27

$

(0.12)

Basic weighted average common shares outstanding



80,351



79,830



80,253



81,106

Diluted earnings (loss) per share

$

0.30

$

(0.05)

$

0.26

$

(0.12)

Diluted weighted average common shares outstanding



81,266



79,830



81,043



81,106

Condensed Unaudited Consolidated Balance Sheets

(In thousands)







June 30,



December 31,





2016



2015

Assets









Current assets

$

1,321,842

$

1,129,758

Property and equipment, net



559,057



558,667

Goodwill and other intangibles, net



1,190,672



1,187,890

Other long-term assets



52,372



51,032

Total assets

$

3,123,943

$

2,927,347





















Liabilities and Equity









Current liabilities

$

866,434

$

752,535

Acquisition-related contingent consideration, net of current portion



25,151



41,675

Long-term debt



998,440



932,868

Long-term deferred tax liabilities, net



173,220



188,759

Other long-term liabilities



90,482



68,119

Equity



970,216



943,391

Total liabilities and equity

$

3,123,943

$

2,927,347

Condensed Unaudited Consolidated Statements of Cash Flows

(In thousands)







For the Six Months Ended

June 30,





2016



2015











Net cash provided by operating activities

$

28,488

$

161,289

Net cash used in investing activities



(59,872)



(109,583)

Net cash provided by (used in) financing activities



36,046



(70,368)

Effect of currency translation on cash



(888)



(642)

Net increase (decrease) in cash and cash equivalents



3,774



(19,304)

Cash and cash equivalents - beginning of period

$

4,984

$

24,059

Cash and cash equivalents - end of period

$

8,758

$

4,755

Supplemental Disclosures and Reconciliation of Non-GAAP Disclosures - Unaudited

(In millions, except for percentages and per share amounts)







For the Three Months Ended

June 30,



For the Six Months Ended

June 30,

Segment Information



2016



2015



2016



2015

Revenue by Reportable Segment

















Communications

$

592.2

$

468.9

$

1,103.8

$

938.8

Oil and Gas



425.6



410.5



718.4



737.3

Electrical Transmission



95.6



78.2



181.9



194.3

Power Generation and Industrial



119.7



103.1



201.1



187.4

Other



3.9



6.9



7.3



13.5

Eliminations



(4.6)



(1.0)



(5.9)



(1.4)

Corporate



-



-



-



-

Consolidated revenue

$

1,232.4

$

1,066.6

$

2,206.6

$

2,069.9























For the Three Months Ended June 30,



For the Six Months Ended

June 30,





2016



2015



2016



2015

Adjusted EBITDA by...


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