EMCOR Group (EME) Tops Q2 EPS by 21c, Beats on Revenues; Boosts FY18 EPS/Revenue Outlooks

EMCOR Group (NYSE: EME) reported Q2 EPS of $1.21, $0.21 better than the analyst estimate of $1.00. Revenue for the quarter came in at $1.95 billion versus the consensus estimate of $1.91 billion.

• Record Second Quarter Revenues of $1.95 Billion, 3.1% Increase Year-over-Year
• Record Second Quarter Diluted EPS from Cont. Operations of $1.21, 27.4% Increase Year-over-Year
• Increases Full-Year Revenue Guidance and Diluted EPS Guidance Range

Tony Guzzi, Chairman, President and Chief Executive Officer of EMCOR, commented, “The Company delivered record second quarter revenue and record quarterly diluted earnings per share, building upon the strong momentum that we saw during the start of the year. This was driven by continued strength in our U.S. Construction and Building Services segments, as well as excellent performance in our U.K. Building Services segment. Consistent project execution across our business drove an 8% increase in operating income year-over-year and solid operating margin expansion to 5.1% of revenues. We are very pleased with these results, and continue to see strong project opportunities across geographies and end markets.”

Mr. Guzzi added, “Our U.S. Construction segments continued to perform exceptionally, with combined revenue and operating income growth of 2.4% and 9.8%, respectively. Our U.S. Electrical Construction segment revenue increased 6.7% year-over-year driven by solid execution on our diverse mix of projects. We are pleased with the performance in our U.S. Mechanical Construction segment, which grew operating income 8.5% year-over-year, despite a difficult comparison to the year ago period, due to the benefit of certain cost recoveries from a project completed in 2016. Our U.S. Building Services segment continued to deliver solid results, with double-digit operating income growth driven by strong performance in our government and energy services businesses. Results in our U.S. Industrial Services segment reflected expected weakness due to typical seasonality, further impacted by the continued residual effects from Hurricane Harvey. However, we believe that we have largely surpassed the headwinds in this segment, and expect improved performance in the second half of 2018 with the resumption of normal demand and increased project activity in our shop business. Finally, our U.K. Building Services segment had another outstanding quarter, with revenue growth of over 33% year-over-year, as we continue to execute specialty project work and expand our business with new contract awards.”

GUIDANCE:

EMCOR Group sees FY2018 EPS of $4.40-$4.80, versus the consensus of $4.48. EMCOR Group sees FY2018 revenue of $7.8 billion, versus the consensus of $7.79 billion.

For earnings history and earnings-related data on EMCOR Group (EME) click here.

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