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Mar 31, 2023
Primoris Q1 2023 Earnings Report
Reported solid results in the first quarter of 2023, surpassing goals in revenue, gross profit and earnings per share.
Key Takeaways
Primoris Services Corporation reported a strong first quarter in 2023, with revenue reaching $1,256.9 million, a 60.2% increase compared to the same period in 2022. Net income was $1.3 million, or $0.02 per diluted share, and adjusted net income was $9.9 million, or $0.18 per diluted share. The company's backlog reached $5.6 billion, up 38.1% from the first quarter of 2022.
Revenue increased by 60.2% year-over-year to $1,256.9 million, driven by growth in the Utilities and Energy segments and contributions from acquisitions.
Net income rose to $1.3 million, or $0.02 per diluted share, compared to a net loss in the first quarter of 2022.
Backlog increased by 38.1% year-over-year to $5.6 billion, including $2.0 billion in Master Service Agreements (MSA) backlog.
The company is maintaining its estimates for the year ending December 31, 2023, with adjusted EPS estimated in the range of $2.50 to $2.70.
Primoris
Primoris
Forward Guidance
The Company is maintaining its estimates for the year ending December 31, 2023. Net income is expected to be between $2.10 and $2.30 per fully diluted share. Adjusted EPS is estimated in the range of $2.50 to $2.70 for 2023. Adjusted EBITDA for the full year 2023 is expected to range from $350 million to $370 million.
Positive Outlook
- Net income is expected to be between $2.10 and $2.30 per fully diluted share.
- Adjusted EPS is estimated in the range of $2.50 to $2.70 for 2023.
- Adjusted EBITDA for the full year 2023 is expected to range from $350 million to $370 million.
- Targeting SG&A expense as a percentage of revenue in the low six percent range for full year 2023.
- Targeted gross margins by segment are as follows: Utilities in the range of 9 to 11 percent and Energy in the range of 10 to 12 percent.
Challenges Ahead
- Some uncertainty remains as to the economic conditions over the coming quarters.
- Interest expense for the full year 2023 is expected to increase to approximately $73 to $77 million due to higher debt balances and higher interest rates.
- The Company expects its effective tax rate for 2023 to be approximately 28 percent, but it may vary depending on the mix of states in which the Company operates.
- Forward-looking statements are based on current economic conditions and estimates, and the Company does not include other potential impacts, such as changes in accounting or unusual items.
- Backlog, including estimated MSA revenue, should not be considered a comprehensive indicator of future revenue.