01—Abstract
Summary
Summary of the 10-K filed February 27, 2012. Cited figures are marked; the original filing is the authoritative source.
EMCOR Group, Inc. operates as a leading provider of electrical and mechanical construction and facilities services across the United States and the United Kingdom.
For the fiscal year ended December 31, 2011, the company reported revenues of $5.6 billiona, a notable increase from the prior year, driven by strategic acquisitions and growth in its United States facilities services segment, particularly in refinery and petrochemical markets. Despite facing a challenging economic environment characterized by competitive pricing, EMCOR demonstrated resilience by increasing operating income year-over-year, largely due to improved performance in its electrical construction and facilities services segment and the positive impact of acquired businesses.
The company also successfully navigated its operations by selling its Canadian subsidiary and focusing on integrating new acquisitions. EMCOR's management remains focused on executing its growth strategy, managing costs, and maintaining strong customer relationships.
02—Key points
Key Highlights
- EMCOR reported 2011 revenues of $5.6 billion, an increase from $4.9 billion in 2010, driven by acquisitions and performance in key segments.
- Operating income improved to $210.8 million in 2011 from an operating loss of $26.5 million in 2010, primarily due to a significant goodwill impairment charge in the prior year.
- The company divested its Canadian operations in August 2011, focusing on its core U.S. and UK markets.
- Acquisitions played a significant role, with revenues from acquired companies contributing $407.1 million in 2011.
- The United States facilities services segment showed strong growth, with revenues increasing by 33% to $2.02 billion.
- The company repurchased approximately $27.5 million of its common stock during 2011 under a $100 million authorization.
- Backlog increased to $3.3 billion at year-end 2011 from $3.1 billion in 2010, indicating future revenue potential.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in FY2011, EMCOR Group kept $0.02.
- Revenue$5.61B100.0%
- Cost of revenue−$4.88B86.9%
- Gross profit$733.9M13.1%
- Operating costs−$523.2M9.3%
- Operating income$210.8M3.8%
- Interest, other & tax−$80.0M1.4%
- Net income$130.8M2.3%
Where FY2011 revenue went
$5.61B- Cost of revenue: $4.88B, 87% of revenue
- Net income: $130.8M, 2.3% of revenue
- SG&A: $518.1M, 9.2% of revenue
- Interest, other & tax: $80.0M, 1.4% of revenue
Kept 2.3% as net incomeNet income $130.8M · 2.3%Interest, other & tax $80.0M · 1.4%
Full revenue history →04—Financials
Financial Highlights
Figures from 10-KFY2011filed February 27, 2012Financial Statements
FY2011 against FY2010
| Line item | FY2011FY2010 | Change |
|---|---|---|
| Revenue | $5.61B$4.85B | +15.7% |
| Cost of Revenue | $4.88B$4.16B | +17.3% |
| Gross Profit | $733.95M$693.52M | +5.8% |
| SG&A Expenses | $518.12M$472.13M | +9.7% |
| Operating Income | $210.79M-$26.53M | +894.6% |
| Interest Expense | $11.26M$12.15M | −7.3% |
| Net Income | $130.83M-$86.69M | +250.9% |
| EPS (Basic) | $1.96$-1.31 | +249.6% |
| EPS (Diluted) | $1.91$-1.31 | +245.8% |
| Shares Outstanding (Basic) | 66.78M66.39M | +0.6% |
| Shares Outstanding (Diluted) | 68.38M66.39M | +3.0% |
05—Questions
Frequently Asked Questions
What were EMCOR's key financial performance indicators in 2011?
In 2011, EMCOR reported revenues of $5.6 billion, an increase of 15.7% from 2010. Operating income was $210.8 million, a significant improvement from the $26.5 million operating loss in 2010. Net income attributable to EMCOR Group, Inc. was $130.8 million, or $1.91 per diluted share, compared to a net loss of $86.7 million in 2010.
How did the company's segment performance contribute to the 2011 results?
The United States facilities services segment was a key driver of growth, with revenues increasing by 33% to $2.02 billion. The United States mechanical construction and facilities services segment also saw revenue growth, while the United States electrical construction and facilities services segment remained relatively flat. The United Kingdom operations also contributed positively to revenue.
What significant corporate actions did EMCOR undertake in 2011?
In 2011, EMCOR completed three acquisitions to expand its service offerings, notably USM Services Holdings, Inc. The company also divested its Canadian subsidiary, which was no longer considered a strategic fit. Additionally, EMCOR announced and commenced a stock repurchase program, buying back approximately $27.5 million of its common stock.
What are the main risks EMCOR highlighted in its 2011 filing?
EMCOR identified several risks, including the impact of economic downturns on demand for services, cyclicality in client industries, potential increases in material and energy prices, intense competition, reliance on fixed-price contracts, and labor-related risks due to a largely unionized workforce. They also noted the importance of surety bonds for securing projects.
06—Continue