Dycom Industries, Inc. Announces Fiscal 2014 Second Quarter Results And Provides Guidance For The Next Fiscal Quarter

Feb 25, 2014, 16:19 ET from Dycom Industries, Inc.

PALM BEACH GARDENS, Fla., Feb. 25, 2014 /PRNewswire/ -- Dycom Industries, Inc. (NYSE: DY) announced today its results for the second quarter ended January 25, 2014.

The Company reported:

  • Contract revenues of $390.5 million for the quarter ended January 25, 2014, compared to $369.3 million for the quarter ended January 26, 2013. Contract revenues for the quarter ended January 25, 2014 grew 0.9% on an organic basis after excluding revenues from businesses acquired during fiscal 2013 from the three month periods ended January 25, 2014 and January 26, 2013 and $16.7 million of revenues for storm restoration services in the three months ended January 26, 2013. Revenues from businesses acquired during fiscal 2013 were $111.5 million and $75.9 million for the three months ended January 25, 2014 and January 26, 2013, respectively.
  • Adjusted EBITDA (Non-GAAP) of $28.2 million for the three months ended January 25, 2014, compared to $37.2 million for the three months ended January 26, 2013. 
  • Net loss of $3.1 million, or $0.09 loss per common share, for the quarter ended January 25, 2014, compared to net income of $1.5 million, or $0.04 per common share diluted, for the quarter ended January 26, 2013. On a Non-GAAP basis, net income for the quarter ended January 26, 2013 was $5.2 million, or $0.15 per common share diluted. The Non-GAAP net income for the quarter ended January 26, 2013 excludes $5.8 million in pre-tax acquisition related costs and a pre-tax write-off of $0.3 million of deferred financing costs in connection with the replacement of the Company's credit facility in December 2012.

Worse than expected weather during the latter part of the second fiscal quarter of 2014 sharply impacted the Company's results. Major snowfalls and extremely cold temperatures reduced the number of available workdays and negatively impacted productivity and margins.

The Company also reported:

  • Contract revenues of $903.2 million for the six months ended January 25, 2014, compared to $692.6 million for the six months ended January 26, 2013. Contract revenues for the six months ended January 25, 2014 grew 5.8% on an organic basis after excluding revenues from businesses acquired during fiscal 2013 from the six month periods ended January 25, 2014 and January 26, 2013 and $16.7 million of revenues for storm restoration services in the six months ended January 26, 2013. Revenues from businesses acquired during fiscal 2013 were $268.6 million and $75.9 million for the six months ended January 25, 2014 and January 26, 2013, respectively.
  • Adjusted EBITDA (Non-GAAP) of $91.4 million for the six months ended January 25, 2014, compared to $77.6 million for the six months ended January 26, 2013. 
  • Net income of $15.6 million, or $0.45 per common share diluted, for the six months ended January 25, 2014, compared to $13.3 million, or $0.40 per common share diluted, for the six months ended January 26, 2013. On a Non-GAAP basis, net income for the six months ended January 26, 2013 was $17.5 million, or $0.52 per common share diluted. The Non-GAAP net income for the six months ended January 26, 2013 excludes $6.5 million in pre-tax acquisition related costs and a pre-tax write-off of $0.3 million of deferred financing costs in connection with the replacement of the Company's credit facility in December 2012.

The Company also announced its outlook for the third quarter of fiscal 2014. The Company currently expects revenue for the third quarter of fiscal 2014 to range from $415.0 million to $435.0 million and diluted earnings per share to range from $0.19 to $0.26.

The Company has defined Adjusted EBITDA (Non-GAAP) as earnings before interest, taxes, depreciation and amortization, gain on sale of fixed assets, acquisition related costs, write-off of deferred financing costs, stock-based compensation expense, and certain non-recurring items. See the accompanying tables which present a reconciliation of GAAP to Non-GAAP financial information.

A conference call to review the Company's results will be hosted at 9:00 a.m. (ET), Wednesday, February 26, 2014; call (800) 230-1074 (United States) or (612) 288-0340 (International) ten minutes before the conference call begins and ask for the "Dycom Results" conference call. A live webcast of the conference call, along with related materials, will be available at http://www.dycomind.com under the heading "Events." The conference call materials will be available at approximately 7:00 a.m. (ET) on February 26, 2014. If you are unable to attend the conference call at the scheduled time, a replay of the live webcast and the conference call materials will be available at http://www.dycomind.com until Friday, March 28, 2014.

For additional detail on selected financial information including organic revenue, customer metrics, and certain other selected financial data and Non-GAAP measures, please refer to the Trend Schedule on Dycom's website at http://www.dycomind.com in the Investor Center. The Trend Schedule will be available at approximately 7:00 a.m. (ET) on February 26, 2014.

Dycom is a leading provider of specialty contracting services throughout the United States and in Canada. These services include engineering, construction, maintenance and installation services to telecommunications providers, underground facility locating services to various utilities, including telecommunications providers, and other construction and maintenance services to electric and gas utilities and others.

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). The Company believes that the presentation of certain Non-GAAP financial measures in this press release provides information that is useful to investors because it allows for a more direct comparison of the Company's performance for the period with the Company's performance in the comparable prior-year period. The Company cautions that Non-GAAP financial measures should be considered in addition to, but not as a substitute for, the Company's reported GAAP results. 

Fiscal 2014 second quarter results are preliminary and are unaudited. This press release contains forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act. These statements are based on management's current expectations, estimates and projections. Forward-looking statements are subject to risks and uncertainties that may cause actual results in the future to differ materially from the results projected or implied in any forward-looking statements contained in this press release. The most significant of these risks and uncertainties are described in our Form 10-K, Form 10-Q and Form 8-K reports (including all amendments to those reports) and include business and economic conditions and trends in the telecommunications industry affecting our customers, the adequacy of our insurance and other reserves and allowances for doubtful accounts, whether the carrying value of our assets may be impaired, preliminary purchase price allocations of businesses acquired, expected benefits and synergies of acquisitions, the future impact of any acquisitions or dispositions, the anticipated outcome of other contingent events, including litigation, liquidity and other financial needs, the availability of financing, and the other risks and uncertainties detailed from time to time in our filings with the Securities and Exchange Commission. The Company does not undertake to update forward-looking statements.

 

---Tables Follow---

 

DYCOM INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

January 25, 2014 and July 27, 2013

Unaudited

January 25,

July 27,

2014

2013

ASSETS

(Dollars in thousands)

CURRENT ASSETS:

Cash and equivalents

$

16,344

$

18,607

Accounts receivable, net

231,619

252,202

Costs and estimated earnings in excess of billings

174,138

204,349

Inventories

43,426

35,999

Deferred tax assets, net

16,334

16,853

Income taxes receivable

18,347

2,516

Other current assets

16,142

10,608

Total current assets

516,350

541,134

PROPERTY AND EQUIPMENT, NET

203,639

202,703

GOODWILL

267,810

267,810

INTANGIBLE ASSETS, NET

115,243

125,275

OTHER

16,852

17,286

TOTAL NON-CURRENT ASSETS

603,544

613,074

TOTAL ASSETS

$

1,119,894

$

1,154,208

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES:

Accounts payable

$

52,315

$

77,954

Current portion of debt

9,375

7,813

Billings in excess of costs and estimated earnings

13,869

13,788

Accrued insurance claims

32,638

29,069

Other accrued liabilities

57,566

71,191

Total current liabilities

165,763

199,815

LONG-TERM DEBT

416,301

444,169

ACCRUED INSURANCE CLAIMS

30,942

27,250

DEFERRED TAX LIABILITIES, NET NON-CURRENT

49,003

48,612

OTHER LIABILITIES

6,249

6,001

Total liabilities

668,258

725,847

Total Stockholders' Equity

451,636

428,361

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY

$

1,119,894

$

1,154,208

 

DYCOM INDUSTRIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

Unaudited

Three Months

Three Months

Six Months

Six Months

Ended

Ended

Ended

Ended

January 25,

January 26,

January 25,

January 26,

2014

2013

2014

2013

(Dollars in thousands, except per share amounts)

Contract revenues 

$

390,518

$

369,326

$

903,238

$

692,613

Costs of earned revenues, excluding depreciation and amortization

327,353

301,516

737,472

558,582

General and administrative expenses (1)

38,562

38,827

81,637

67,652

Depreciation and amortization

23,435

20,819

46,987

36,130

Total 

389,350

361,162

866,096

662,364

Interest expense, net

(6,800)

(5,748)

(13,686)

(9,946)

Other income, net

595

428

2,607

2,042

Income (loss) before income taxes

(5,037)

2,844

26,063

22,345

Provision (benefit) for income taxes

(1,970)

1,381

10,470

9,022

Net income (loss)

$

(3,067)

$

1,463

$

15,593

$

13,323

Earnings (loss) per common share:

Basic earnings (loss) per common share

$

(0.09)

$

0.04

$

0.46

$

0.40

Diluted earnings (loss) per common share

$

(0.09)

$

0.04

$

0.45

$

0.40

Shares used in computing income (loss) per common share:

   Basic

33,836,099

32,780,667

33,629,884

32,935,305

   Diluted

33,836,099

33,514,416

34,767,945

33,607,180

(1) Includes stock-based compensation expense of $3.5 million and $2.5 million for the three months ended January 25, 2014 and January 26, 2013, respectively, and $7.0 million and $4.8 million for the six months ended January 25, 2014 and January 26, 2013, respectively.

 

DYCOM INDUSTRIES, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP INFORMATION

Unaudited

The below table presents the reconciliation of GAAP contract revenues to Non-GAAP contract revenues adjusted to exclude revenues from subsidiaries acquired during fiscal 2013 and storm restoration service revenues generated during the prior year periods, as well as the percentages of growth of GAAP and Non-GAAP contract revenues.

Contract Revenues - GAAP

Revenues from subsidiaries acquired in fiscal 2013

Revenues from storm restoration services

Contract Revenues - Non-GAAP

% Growth - GAAP

% Growth - Non-GAAP

(Dollars in thousands)

Three Months Ended January 25, 2014

$    390,518

$       (111,500)

$              -

$    279,018

5.7

%

0.9

%

Three Months Ended January 26, 2013

$    369,326

$         (75,946)

$   (16,721)

$    276,659

Six Months Ended January 25, 2014

$    903,238

$       (268,577)

$              -

$    634,661

30.4

%

5.8

%

Six Months Ended January 26, 2013

$    692,613

$         (75,946)

$   (16,721)

$    599,946

 

DYCOM INDUSTRIES, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP INFORMATION

Unaudited

(continued)

The below table presents the Non-GAAP financial measure of Adjusted EBITDA for the three and six months ended January 25, 2014 and January 26, 2013 and a reconciliation of Adjusted EBITDA to net income (loss), the most directly comparable GAAP measure.

Three Months

Three Months

Six Months

Six Months

Ended

Ended

Ended

Ended

January 25,

January 26,

January 25,

January 26,

2014

2013

2014

2013

(Dollars in thousands)

Reconciliation of net income (loss) to Adjusted EBITDA (Non-GAAP):

Net income (loss)

$

(3,067)

$

1,463

$

15,593

$

13,323

Interest expense, net

6,800

5,748

13,686

9,946

Provision (benefit) for income taxes

(1,970)

1,381

10,470

9,022

Depreciation and amortization expense

23,435

20,819

46,987

36,130

Earnings Before Interest, Taxes, Depreciation & Amortization ("EBITDA")

25,198

29,411

86,736

68,421

Gain on sale of fixed assets

(570)

(826)

(2,435)

(2,407)

Stock-based compensation expense

3,544

2,496

7,049

4,762

Acquisition related costs

-

5,829

-

6,539

Write-off of deferred financing costs

-

321

-

321

Adjusted EBITDA (Non-GAAP)

$

28,172

$

37,231

$

91,350

$

77,636

 

DYCOM INDUSTRIES, INC. AND SUBSIDIARIES

RECONCILIATION OF GAAP TO NON-GAAP INFORMATION

Unaudited

(continued)

The below table presents a reconciliation of GAAP to Non-GAAP net income for the three and six months ended January 26, 2013.

Three Months

Six Months

Ended

Ended

January 26,

January 26,

2013

2013

(Dollars in thousands, except per share amounts)

Reconciling Items:

Acquisition related costs, pre-tax

$

(5,829)

$

(6,539)

Write-off of deferred financing costs

(321)

(321)

Total Reconciling Items

$

(6,150)

$

(6,860)

GAAP net income

$

1,463

$

13,323

Adjustment for Reconciling Items above, net of tax

3,710

4,154

Non-GAAP net income

$

5,173

$

17,477

Earnings per common share:

Basic earnings per common share  - GAAP

$

0.04

$

0.40

Adjustment for Reconciling Items above, net of tax

0.11

0.13

Basic earnings per common share - Non-GAAP 

$

0.16

$

0.53

Diluted earnings per common share - GAAP

$

0.04

$

0.40

Adjustment for Reconciling Items above, net of tax

0.11

0.12

Diluted earnings per common share - Non-GAAP 

$

0.15

$

0.52

Earnings per share amounts may not add due to rounding.

Shares used in computing GAAP and Non-GAAP earnings per common share and adjustment for Reconciling Items above:

   Basic

32,780,667

32,935,305

   Diluted

33,514,416

33,607,180

 

SOURCE Dycom Industries, Inc.



RELATED LINKS

http://www.dycomind.com