NV5 Global (NASDAQ: NVEE) reported Q4 EPS of $0.91, $0.03 worse than the analyst estimate of $0.94. Revenue for the quarter came in at $116.1 million versus the consensus estimate of $118.07 million.

“We are pleased to announce continued strong performance in revenues and earnings in the fourth quarter and full year 2018 and we are looking forward to continued strong organic, acquisition and strategic growth in 2019. Our success in the fourth quarter and full year 2018 was reflected in our strong backlog, profitability, and substantial growth in our strategic geographic presence and service offerings,” said Dickerson Wright, PE Chairman and CEO of NV5. “In the fourth quarter, Gross Revenues increased 23%, EBITDA increased 34% and Net Income increased 38%, excluding the impact of the Tax Cuts and Jobs Act of 2017 (“2017 Tax Reform”). In the full year 2018, Gross Revenues increased 26%, EBITDA increased 34% and Net Income increased 49%, excluding the impact of the 2017 Tax Reform. Our core business remains robust and organic growth for the full year 2018 was 8%. Additionally, our acquisition pipeline is active and we are confident about the strategic investments we are making to further grow our infrastructure and energy business throughout the United States.”

Fourth Quarter 2018 Financial Highlights

• Total Revenues for the quarter were $116.1 million, an increase of 22% year-over-year. Gross Revenues – GAAP for the quarter were $115.3 million, an increase of 23% year-over-year.
• Net Revenues for the quarter were $88.5 million, an increase of 21% year-over-year.
• Organic revenue growth for the quarter was 5%. Organic growth is measured by internal growth of our existing business plus growth from acquisitions from the time of acquisition.
• EBITDA for the quarter was $15.8 million or 18% of Net Revenues, an increase of 34% from $11.8 million, or 16% of Net Revenues in the fourth quarter of 2017.
• Income before income tax expense for the quarter was $9.8 million, an increase of $2.5 million, or 34% compared to $7.3 million in the fourth quarter of 2017.
• Net Income for the quarter was $7.7 million. Excluding the impact of the 2017 Tax Reform, Net Income increased 38% over the fourth quarter of 2017 from $5.6 million. Net Income, including the impact of the 2017 Tax Reform, was $11.5 million in the fourth quarter of 2017.
• Adjusted EPS for the quarter was $0.91 per diluted share. Excluding the impact of the 2017 Tax Reform, Adjusted EPS increased 28% from $0.71 per share in the fourth quarter of 2017. Adjusted EPS, including the impact of the 2017 Tax Reform, was $1.26 per diluted share in the fourth quarter of 2017.
• GAAP EPS for the quarter was $0.62 per diluted share over 12.4 million shares. Excluding the impact of the 2017 Tax Reform, GAAP EPS increased 22% from $0.51 per share in the fourth quarter of 2017. GAAP EPS, including the impact of the 2017 Tax Reform, was $1.06 per diluted share over 10.9 million shares in the fourth quarter of 2017.
• Backlog was $390 million as of December 29, 2018, a 32% increase from $296 million as of December 30, 2017.
• Cash flow from operating activities increased $5.5 million, or 46% to $17.4 million for the quarter compared to $12.0 million in the fourth quarter of 2017.

GUIDANCE:

NV5 Global sees FY2019 EPS of $3.51-$3.93, versus the consensus of $3.88. NV5 Global sees FY2019 revenue of $485-520 million, versus the consensus of $522.75 million.

The Company is initiating guidance for full year 2019 Gross Revenues, Net Revenues, Adjusted EPS and GAAP EPS, including the impact of acquisitions closed through February 28, 2019. The Company expects Gross Revenues to range from $485 million to $520 million, which represents an increase of 16% to 24% from 2018 Gross Revenues of $418 million. Net Revenues are expected to range from $385 million to $414 million, which represents an increase of 15% to 24% from 2018 Net Revenues of $334 million. The Company expects full year 2019 Adjusted EPS to range from $3.51 per share to $3.93 per share, an increase of 8% to 21%. Furthermore, the Company expects full year 2019 GAAP EPS to range from $2.44 per share to $2.85 per share. This guidance for Total Revenues, Net Revenues, Adjusted EPS and GAAP EPS excludes anticipated acquisitions for the remainder of 2019.

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