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Quanta Services (PWR) Reports In-Line Q1 EPS; Offers FY20 EPS Guidance Below Consensus

May 7, 2020 7:01 AM EDT

Quanta Services (NYSE: PWR) reported Q1 EPS of $0.47, in-line with the analyst estimate of $0.47. Revenue for the quarter came in at $2.76 billion versus the consensus estimate of $2.74 billion.

"Quanta is operating in unprecedented health and economic conditions, and we remain focused on the health and safety of our employees, while continuing to deliver critical infrastructure services to our customers. Quanta generated solid results in the first quarter that put us on track to meet our pre-COVID-19 pandemic full-year outlook. We ended the quarter with near record backlog and a strong balance sheet, which we believe demonstrates the sustainability of our business and favorable positioning going forward," said Duke Austin, President and Chief Executive Officer of Quanta Services. "We estimate that 80% to 90% of our revenues are derived from utility, communications and certain pipeline and industrial infrastructure services that we believe will continue to be resilient, even in the current challenging environment, and we expect to achieve record backlog during the year. We anticipate the second quarter to be our most challenging of the year due to short-term disruptions; however, we are collaborating with our customers and preparing our resources with the expectation that operating conditions will normalize throughout the year.

"Quanta was built for times like these, and we are confident in the resiliency and sustainability of our business model. We believe the successful execution of our key objectives over the past several years, coupled with significant financial liquidity, have positioned us well, and provide us the strength and flexibility to not only navigate through times of uncertainty, but come out the other side better positioned. Quanta's people are the heart of our company, and they are critical to our success going forward. I again want to recognize and thank them for their hard work and dedication during this challenging time. As a critical infrastructure services company, their efforts are especially needed - perhaps now more than ever."

GUIDANCE:

Quanta Services sees FY2020 EPS of $3.04-$3.36, versus the consensus of $3.58.

The long-term outlook for Quanta's business is positive. However, weather, regulatory, permitting, project timing, execution challenges and other factors have impacted the company's historical results, and may impact Quanta's future financial results. More recently, the COVID-19 pandemic has significantly impacted certain of Quanta's operations and various markets where Quanta operates, which has created additional uncertainty. Therefore, Quanta's financial outlook for revenues, margins and earnings reflects management's effort to align these uncertainties with the backlog the company is executing on and the opportunities expected to materialize during the remainder of 2020. Management believes continuing to provide expectations commentary to the investment community in times of uncertainty has value and will discuss its outlook in detail on its earnings conference call this morning. However, given the circumstances, Quanta's outlook commentary should be considered directional and is subject to numerous market and other conditions that are beyond the company's control and represent management's current assessment of potential financial results.

For earnings history and earnings-related data on Quanta Services (PWR) click here.



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