Summary
Quanta Services, Inc. (PWR) reported robust financial performance for the second quarter and first half of 2018. Total revenues increased by 20.7% year-over-year for the quarter and 15.9% for the half, driven by strong demand in both the Electric Power and Oil & Gas Infrastructure Services segments. The company saw significant revenue growth in its Electric Power segment, attributed to increased customer spending on transmission and distribution projects, alongside favorable progress on a large Canadian transmission project and emergency restoration services. The Oil & Gas segment also experienced revenue growth, largely due to the inclusion of recently acquired businesses, though this was partially offset by a decrease in large-diameter pipeline work. Profitability metrics showed a mixed trend. While gross profit increased in absolute terms, the gross profit margin slightly compressed year-over-year, particularly in the Oil & Gas segment due to a lower proportion of higher-margin large diameter pipeline work. Operating income for the Electric Power segment saw substantial growth, while the Oil & Gas segment's operating income declined. The company's effective tax rate decreased due to the Tax Cuts and Jobs Act. Quanta also reported a strong backlog, indicating continued demand for its services.
Financial Highlights
55 data points| Revenue | $2.66B |
| Cost of Revenue | $2.32B |
| Gross Profit | $333.37M |
| SG&A Expenses | $206.10M |
| Operating Income | $123.04M |
| Interest Expense | $9.18M |
| Net Income | $74.71M |
| EPS (Basic) | $0.49 |
| EPS (Diluted) | $0.48 |
| Shares Outstanding (Basic) | 153.32M |
| Shares Outstanding (Diluted) | 154.59M |
Key Highlights
- 1Revenues for the quarter increased 20.7% to $2.66 billion, and for the first half of 2018, revenues rose 15.9% to $5.07 billion, reflecting strong demand across both segments.
- 2The Electric Power Infrastructure Services segment showed robust growth, with revenues up 20.7% for the quarter and 24.5% for the first half, driven by transmission, distribution, and emergency restoration services.
- 3The Oil & Gas Infrastructure Services segment's revenues increased by 20.7% for the quarter, aided by acquisitions, but operating income declined by 35.3% due to a shift away from higher-margin large diameter pipeline projects.
- 4Gross profit margin for the quarter slightly decreased to 12.5% from 13.7% in the prior year, primarily due to the change in service mix within the Oil & Gas segment.
- 5The company's effective tax rate decreased to 28.2% for the quarter and 29.5% for the first half, benefiting from the lower U.S. federal corporate tax rate enacted by the Tax Cuts and Jobs Act.
- 6Quanta's backlog remained strong, with total backlog at $11.49 billion as of June 30, 2018, indicating a healthy pipeline of future work.
- 7Cash flow from operations improved significantly, with $156.5 million generated in the quarter and $182.5 million in the first half, a substantial increase from the prior year periods.