MYRG
Myr Group INC
NASDAQ
8-K: MYR Group Inc. Reports Slight Revenue Increase in First Quarter 2024 Amidst Supply Chain Challenges
Sentiment:
Quarterly Report
1 May 2024 4:08 PM
MYR Group Inc. announced a slight revenue increase for the first quarter of 2024, with $815.6 million, despite facing some supply chain and regulatory headwinds.
Worse than expected
Net income decreased from $23.2 million to $18.9 million year-over-year.
EBITDA decreased from $41.3 million to $39.8 million year-over-year.
Backlog decreased from $2.67 billion to $2.43 billion year-over-year.
Delay expected
The Commercial and Industrial segment experienced a revenue decrease due to the delayed start of certain projects.
Summary
- MYR Group Inc. reported first-quarter 2024 revenues of $815.6 million, a 0.5% increase compared to the same period in 2023.
- The Transmission and Distribution (T&D) segment saw a 10.1% revenue increase, reaching $490.4 million, while the Commercial and Industrial (C&I) segment experienced an 11.2% decrease to $325.2 million due to project delays.
- Consolidated gross profit rose to $86.2 million, with a gross margin of 10.6%, up from 10.4% in the first quarter of 2023.
- Net income for the quarter was $18.9 million, or $1.12 per diluted share, down from $23.2 million, or $1.38 per diluted share, in the first quarter of 2023.
- EBITDA for the first quarter of 2024 was $39.8 million, compared to $41.3 million in the same period last year.
- The company's backlog decreased to $2.43 billion as of March 31, 2024, from $2.51 billion at the end of 2023 and $2.67 billion at the end of March 2023.
Sentiment
Score: 5
Explanation: The sentiment is neutral to slightly negative. While there was a slight revenue increase and gross margin improvement, the decrease in net income, EBITDA, and backlog, along with project delays and supply chain issues, temper the positive aspects.
Positives
- The company experienced a slight increase in overall revenue compared to the same period last year.
- The Transmission and Distribution segment showed strong growth with a 10.1% increase in revenue.
- Gross profit increased due to higher revenues and improved margins.
- Gross margin improved to 10.6% due to better-than-anticipated productivity and favorable project outcomes.
- Bidding activity remains healthy across both business segments, indicating positive long-term growth potential.
Negatives
- The Commercial and Industrial segment experienced an 11.2% decrease in revenue due to project delays.
- Net income decreased to $18.9 million, or $1.12 per diluted share, from $23.2 million, or $1.38 per diluted share, in the first quarter of 2023.
- EBITDA decreased to $39.8 million from $41.3 million in the first quarter of 2023.
- The company's backlog decreased by 9.1% year-over-year.
- Selling, general and administrative expenses increased to $62.2 million due to higher employee-related and compensation costs.
- Interest expense increased to $1.1 million due to higher debt balances and interest rates.
Risks
- The company is facing near-term supply chain and regulatory challenges affecting some customers.
- Project delays in the Commercial and Industrial segment negatively impacted revenue.
- Inclement weather on certain projects caused labor and project inefficiencies.
- Rising costs associated with supply chain disruptions are impacting margins.
- Changes in estimates of gross profit on certain projects resulted in gross margin decreases.
Future Outlook
The company expects continued long-term growth, driven by healthy bidding activity and strategic opportunities, despite near-term challenges. They remain focused on expanding customer relationships and capturing new opportunities.
Management Comments
- Rick Swartz, MYR's President and CEO, stated that the first quarter financials resulted in a slight increase in revenues and consolidated gross profit compared to the same period of 2023.
- Mr. Swartz also noted that the relatively slow start to the year reflects some of the near-term supply chain and regulatory challenges a few of their customers are experiencing.
- Management believes that bidding activity remains healthy across both business segments, demonstrating positive signs for continued long-term growth.
- The company remains focused on expanding strong customer relationships through alliance agreements and strategically capturing new opportunities.
Industry Context
The results reflect the broader challenges in the construction and infrastructure sectors, including supply chain disruptions and regulatory hurdles. The company's focus on both transmission and distribution, as well as commercial and industrial projects, positions it to capitalize on diverse market opportunities.
Comparison to Industry Standards
- MYR Group's performance is mixed when compared to industry peers. Companies like Quanta Services (PWR) and MasTec (MTZ) also operate in the infrastructure sector and have reported varying results, with some experiencing similar supply chain issues.
- MYR's T&D segment growth is in line with the increased investment in grid modernization, while the C&I segment's decline highlights the volatility in project timelines.
- The company's gross margin improvement is a positive sign, but the decrease in net income and backlog suggests potential challenges in maintaining profitability and securing new projects.
- Compared to other specialty contractors, MYR's EBITDA performance is slightly weaker, indicating a need for improved operational efficiency.
Stakeholder Impact
- Shareholders may be concerned about the decrease in net income and backlog.
- Employees may be affected by changes in compensation and project timelines.
- Customers may experience delays due to supply chain and regulatory challenges.
- Suppliers may be impacted by changes in project schedules and material needs.
Next Steps
- MYR will host a conference call on May 2, 2024, to discuss the first-quarter 2024 results.
- The company will continue to focus on expanding customer relationships and capturing new opportunities.
Key Dates
- May 1, 2024: Date of the press release announcing first-quarter 2024 financial results.
- May 2, 2024: Date of the conference call to discuss first-quarter 2024 results.
- March 31, 2024: End of the first quarter of 2024, used for financial reporting.
- December 31, 2023: End of the previous fiscal year, used for comparative financial reporting.
Keywords
electrical contracting, infrastructure, transmission, distribution, commercial, industrial, construction, EBITDA, backlog, revenue
MYRG
Myr Group INC
NASDAQ
Sector: Industrials
Filings with Classifications
Better than expected
30 April 2025 8:05 PM
Quarterly Report
- The company's net income increased from $18.9 million to $23.3 million year over year.
- The company's gross margin increased from 10.6% to 11.6% year over year.
- The company's EBITDA increased from $39.8 million to $50.2 million year over year.
Better than expected
30 April 2025 4:02 PM
Earnings Release
- The company's revenue, net income, and EBITDA all increased compared to the same period in the previous year, indicating improved financial performance.
Worse than expected
10 March 2025 4:04 PM
Investor Presentation
- Net income, EBITDA, earnings per share, and free cash flow decreased in 2024 compared to 2023.
Worse than expected
5 March 2025 4:29 PM
Proxy Statement
- The company's revenues decreased by 7.7% in 2024 compared to 2023.
- The company's net income decreased significantly in 2024, dropping from $91.0 million in 2023 to $30.3 million.
Delay expected
26 February 2025 4:08 PM
Annual Results
- The decrease in C&I revenue was primarily due to the delayed start of certain projects in 2024.
Worse than expected
26 February 2025 4:08 PM
Annual Results
- The company's revenue decreased by 7.7% to $3.36 billion in 2024 from $3.64 billion in 2023.
- The company's net income decreased significantly to $30.3 million in 2024 from $91.0 million in 2023.
- The company's gross margin decreased to 8.6% in 2024 compared to 10.0% for the year ended December 31, 2023.
Delay expected
26 February 2025 4:03 PM
Earnings Release
- The C&I segment experienced a decrease in revenue due to the delayed start of certain projects in 2024.
Worse than expected
26 February 2025 4:03 PM
Earnings Release
- The company's revenue and net income decreased for both the fourth quarter and the full year compared to the previous year.
Better than expected
6 November 2024 4:04 PM
Investor Presentation
- The company's third quarter performance showed improvement over the second quarter, demonstrating strong project execution in core areas of the business.
Worse than expected
30 October 2024 4:06 PM
Quarterly Report
- The company's gross margin and net income were significantly lower than the same period last year due to unfavorable project estimate adjustments.
- The Transmission and Distribution segment experienced a significant decrease in operating income.
- The company's effective tax rate increased due to higher permanent difference items.
Delay expected
30 October 2024 4:06 PM
Quarterly Report
- The company's financial results are being affected by delays due to supply chain disruptions and regulatory slowdowns.
- Schedule extensions caused by owner-furnished panel delays led to increased costs on two clean energy projects.
Worse than expected
30 October 2024 4:03 PM
Quarterly Report
- The company's third-quarter revenue and net income were lower than the same period last year.
- The company's gross margin decreased compared to the same period last year.
- The company's earnings per share were lower than the same period last year.
Worse than expected
21 August 2024 4:29 PM
Investor Presentation
- The company reported a net loss of $15.3 million in Q2 2024, which is worse than expected due to project timing issues.
Delay expected
31 July 2024 4:26 PM
Quarterly Report
- The company's financial results are expected to continue to be affected by delays and cost volatility through 2024 due to supply chain disruptions, inflationary pressures, tariffs and regulatory slowdowns.
- The company experienced a decrease in C&I revenue due to the delayed start of certain projects.
Worse than expected
31 July 2024 4:26 PM
Quarterly Report
- The company's net income was significantly lower than expected due to significant changes in project cost estimates.
- The company's gross margin was significantly lower than expected due to significant changes in project cost estimates.
- The company's revenue was lower than expected due to a decrease in revenue on transmission projects, a decrease in C&I revenue, and a decrease in revenue on distribution projects.
Worse than expected
31 July 2024 4:16 PM
Quarterly Report
- The company reported a net loss of $15.3 million for the second quarter, a significant downturn compared to the net income of $22.3 million in the same period last year.
- EBITDA for the second quarter was ($4.7) million, a substantial decrease from $47.1 million in the second quarter of 2023.
- Gross margin decreased to 4.9% in the second quarter of 2024, down from 10.1% in the second quarter of 2023.
Delay expected
31 July 2024 4:16 PM
Quarterly Report
- The Commercial and Industrial (C&I) segment reported a decrease in quarterly revenues primarily due to the delayed start of certain projects.
Better than expected
8 May 2024 4:02 PM
Investor Presentation
- The company achieved record revenue and EPS in 2023, exceeding previous results.
- The company's LTM revenue as of March 31, 2024, reached a record high of $3.65 billion.
- The company has a strong backlog of $2.43 billion, indicating future growth potential.
Delay expected
1 May 2024 4:25 PM
Quarterly Report
- The company expects financial results to be affected by delays due to supply chain disruptions and regulatory slowdowns.
- The C&I segment experienced a revenue decrease due to the delayed start of certain projects.
Worse than expected
1 May 2024 4:25 PM
Quarterly Report
- Net income decreased compared to the same quarter last year.
- Project estimate changes negatively impacted gross margin and operating income.
- Backlog decreased from the previous quarter.
Worse than expected
1 May 2024 4:08 PM
Quarterly Report
- Net income decreased from $23.2 million to $18.9 million year-over-year.
- EBITDA decreased from $41.3 million to $39.8 million year-over-year.
- Backlog decreased from $2.67 billion to $2.43 billion year-over-year.
Delay expected
1 May 2024 4:08 PM
Quarterly Report
- The Commercial and Industrial segment experienced a revenue decrease due to the delayed start of certain projects.
Better than expected
5 March 2024 4:06 PM
Investor Presentation
- The company achieved record revenue, net income, earnings per share, and EBITDA for the full year 2023, indicating better than expected results.
- The company's backlog of $2.51 billion demonstrates strong future demand, exceeding expectations.
Worse than expected
28 February 2024 4:16 PM
Annual Results
- The company's gross margin decreased to 10.0% in 2023 from 11.4% in 2022, primarily due to significant changes in estimated gross profit on certain projects.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.