10-KPeriod: FY2011

EMCOR Group, Inc. Annual Report, Year Ended Dec 31, 2011

Filed February 27, 2012For Securities:EME

Summary

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 billion, 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.

Financial Highlights

52 data points
Beta

Revenue

$5.61B

13.1% Gross Margin

Net Income

$130.83M

2.3% Net Margin

EPS (Diluted)

$1.91

Total Assets

$3.01B

Cash & Equivalents

$511.32M

Free Cash Flow

$149.43M

Financial Statements
Beta
Revenue$5.61B
Cost of Revenue$4.88B
Gross Profit$733.95M
SG&A Expenses$518.12M
Operating Income$210.79M
Interest Expense$11.26M
Net Income$130.83M
EPS (Basic)$1.96
EPS (Diluted)$1.91
Shares Outstanding (Basic)66.78M
Shares Outstanding (Diluted)68.38M

Key Highlights

  • 1EMCOR reported 2011 revenues of $5.6 billion, an increase from $4.9 billion in 2010, driven by acquisitions and performance in key segments.
  • 2Operating 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.
  • 3The company divested its Canadian operations in August 2011, focusing on its core U.S. and UK markets.
  • 4Acquisitions played a significant role, with revenues from acquired companies contributing $407.1 million in 2011.
  • 5The United States facilities services segment showed strong growth, with revenues increasing by 33% to $2.02 billion.
  • 6The company repurchased approximately $27.5 million of its common stock during 2011 under a $100 million authorization.
  • 7Backlog increased to $3.3 billion at year-end 2011 from $3.1 billion in 2010, indicating future revenue potential.

Frequently Asked Questions

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.

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.

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.

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.