8-KEarnings & ResultsExhibits & Filings

EMCOR Group, Inc. 8-K Report, Financial Results (Jul 30, 2009)

Filed July 30, 2009For Securities:EME

Summary

EMCOR Group, Inc. reported its second quarter 2009 results on July 30, 2009, highlighting a period of record performance despite a challenging economic environment. Net income attributable to EMCOR Group, Inc. increased by 2.0% to $44.8 million, or $0.67 per diluted share, compared to $44.0 million, or $0.65 per diluted share, in the prior year's second quarter. This was achieved on lower revenues of $1.42 billion, down from $1.72 billion in Q2 2008, indicating improved operational efficiency and cost management. Operating income saw a modest 2.1% increase to $74.9 million, with operating margin expanding significantly from 4.3% to 5.3% of revenues. This margin expansion was driven by a notable decrease in Selling, General, and Administrative (SG&A) expenses, which fell by $14.9 million. The company also updated its full-year 2009 guidance, projecting revenues between $5.5 billion and $5.7 billion and diluted EPS between $2.00 and $2.20, signaling confidence in its ability to navigate the downturn and capitalize on potential economic stimulus. Despite the positive operational and profit improvements, contract backlog declined year-over-year to $3.40 billion from $4.67 billion, primarily due to reduced awards in the hospitality/gaming and commercial sectors. However, backlog growth in the institutional sector and strategic diversification efforts were cited as mitigating factors. EMCOR's strong balance sheet and liquidity were emphasized as key competitive advantages in the current market.

Key Highlights

  • 1Second quarter 2009 net income increased by 2.0% to $44.8 million, with diluted EPS rising to $0.67 from $0.65 in Q2 2008.
  • 2Operating income grew 2.1% to $74.9 million, and operating margin improved significantly to 5.3% from 4.3% in the prior year's quarter.
  • 3Selling, General, and Administrative (SG&A) expenses decreased by $14.9 million, contributing to improved profitability.
  • 4Contract backlog stood at $3.40 billion as of June 30, 2009, a decrease from $4.67 billion a year prior, primarily due to weakness in hospitality/gaming and commercial sectors.
  • 5The company updated its full-year 2009 guidance to revenues of $5.5 billion - $5.7 billion and diluted EPS of $2.00 - $2.20.
  • 6First half 2009 net income increased by 11.3% to $81.6 million, or $1.22 per diluted share, on reduced revenues.
  • 7EMCOR highlighted its strong balance sheet and liquidity as key competitive differentiators in the current economic climate.

Frequently Asked Questions

In the second quarter of 2009, EMCOR reported net income of $44.8 million, or $0.67 per diluted share, a slight increase from $44.0 million, or $0.65 per diluted share, in the second quarter of 2008. While revenues decreased to $1.42 billion from $1.72 billion, operating income increased to $74.9 million with a significantly improved operating margin of 5.3% compared to 4.3% in the prior year, driven by effective cost control and operational efficiency.

As of June 30, 2009, EMCOR's contract backlog was $3.40 billion. This represents a decrease from $4.67 billion as of June 30, 2008. The decline is primarily attributed to reduced contract awards in the hospitality/gaming and commercial sectors, particularly in Las Vegas. However, this was partially offset by backlog growth in the institutional sector.

Yes, based on its first half performance, current market conditions, and backlog, EMCOR updated its full-year 2009 guidance. The company now projects revenues in the range of $5.5 billion to $5.7 billion and full-year diluted earnings per share between $2.00 and $2.20.

EMCOR highlighted its strong balance sheet and growing cash position as key competitive differentiators. The company also emphasized its strategic diversification into more profitable market segments with less direct ties to the overall economy, its disciplined expense management, and its belief that its financial strength and experience position it well to capitalize on potential government stimulus projects.