MasTec Announces Record Second Quarter 2017 Financial Results and Increased 2017 Annual Guidance

August 3, 2017

CORAL GABLES, Fla., Aug. 3, 2017 /PRNewswire/ -- MasTec, Inc. (NYSE: MTZ) today announced strong second quarter financial results and increased 2017 guidance.

  • Record second quarter 2017 revenue was $1.89 billion, a 53% increase compared with $1.23 billion for the same period last year, exceeding the Company's previously announced second quarter 2017 expectation by $390 million.
  • Record second quarter 2017 GAAP net income increased 241% to $83.3 million, or $0.99 per diluted share, compared to $24.4 million, or $0.30 per diluted share, in the second quarter of 2016.
  • Record second quarter 2017 adjusted net income, adjusted diluted earnings per share and adjusted EBITDA, all non-GAAP measures were as follows:
    • Adjusted net income was $86.7 million compared to $29.9 million in the same period of the prior year. Adjusted diluted earnings per share was $1.03, compared to $0.36 in the second quarter of 2016, exceeding the Company's previously announced second quarter 2017 expectation by $0.38.
    • Adjusted EBITDA was $202 million; a 94% increase compared to $104 million in the second quarter of 2016, exceeding the Company's previously announced second quarter 2017 expectation by approximately $52 million.

Adjusted net income, adjusted diluted earnings per share and adjusted EBITDA, which are all non-GAAP measures, exclude certain items which are detailed and reconciled to the most comparable GAAP-reported measures in the attached Supplemental Disclosures and Reconciliation of Non-GAAP Disclosures.

Jose Mas, MasTec's Chief Executive Officer, commented, "Our second quarter performance significantly exceeded our expectations primarily due to record levels of Oil & Gas project activity, with segment revenues at $1.1 billion, a 168% increase over last year's second quarter level. Our current performance, coupled with significant opportunities for future growth across all of our segments, position us well for continued long-term growth."

The Company also announced it has recently completed two acquisitions in the third quarter of 2017, including a Texas based provider of heavy civil, water, sewer and drainage systems infrastructure for private developers, state and local municipalities and a leasing company of Oil & Gas specialty pipeline equipment.

Mr. Mas added the following, "We believe the acquisition of an Oil & Gas specialty equipment provider, will reduce our overall equipment costs and provide us with a competitive advantage during the current multi-year cycle of significant Oil & Gas pipeline project activity, which we expect to continue at record levels. Additionally, we believe that geographic expansion of our heavy civil operations, as well as entry into the water, sewer and drainage systems infrastructure market operations will provide an exciting platform to benefit from increasing demand trends in this market."

George Pita, MasTec's Executive Vice President and Chief Financial Officer, noted, "We significantly exceeded our second quarter expectations in our Oil & Gas segment, including acceleration of some second half 2017 project activity, and are pleased to be in the position of increasing our 2017 guidance to new record levels."

Based on the information available today, the Company is increasing 2017 annual guidance, and providing third quarter guidance. The Company currently estimates 2017 annual revenue of approximately $6.0 billion. 2017 annual GAAP net income is expected to increase 58% over 2016 to approximately $212 million with GAAP diluted earnings per share expected to be $2.53, a 57% increase over 2016. 2017 annual adjusted EBITDA, a non-GAAP measure, is expected to increase 30% over 2016 to $620 million with adjusted diluted earnings per share, a non-GAAP measure, expected to be $2.73, a 44% increase over 2016.

For the third quarter of 2017, the Company expects revenue of approximately $1.65 billion.  Third quarter 2017 GAAP net income is expected to increase 4% over 2016 to approximately $59 million with GAAP diluted earnings per share expected to approximate $0.69. Third quarter 2017 adjusted EBITDA, a non-GAAP measure, is expected to increase 1% over the 2016 period and approximate $167 million with adjusted diluted earnings per share, a non-GAAP measure, expected to approximate $0.73.

Management will hold a conference call to discuss these results on Friday, August 4, 2017 at 9:00 a.m. Eastern Time.  The call-in number for the conference call is (913) 981-5571 and the replay phone number is (719) 457-0820 with a pass code of 5477409.  The replay will be available for 30 days.  Additionally, the call will be broadcast live over the Internet and can be accessed and replayed through the Investors section of the Company's website at www.mastec.com.

The following tables set forth the financial results for the periods ended June 30, 2017 and 2016:


 


Condensed Unaudited Consolidated Statements of Operations

(In thousands, except per share amounts)





For the Three Months Ended

June 30,


For the Six Months Ended

June 30,



2017


2016


2017


2016










Revenue  

$

1,890,180

$

1,232,404

$

3,048,364

$

2,206,630

Costs of revenue, excluding depreciation and amortization               


1,626,335


1,068,182


2,597,469


1,952,583

Depreciation and amortization


45,379


40,657


88,282


79,664

General and administrative expenses      


70,823


67,852


135,604


127,900

Interest expense, net


14,791


12,639


27,388


24,797

Equity in earnings of unconsolidated affiliates


(6,060)


(489)


(7,706)


(3,555)

Other expense (income), net   


146


1,524


576


(11,830)

Income before income taxes

$

138,766


42,039


206,751


37,071

Provision for income taxes     


(55,434)


(17,601)


(82,792)


(15,514)

Net income            

$

83,332

$

24,438

$

123,959

$

21,557

Net income attributable to non-controlling interests       


1,664


350


1,321


162

Net income attributable to MasTec, Inc.   

$

81,668

$

24,088

$

122,638

$

21,395










Earnings per share:









Basic earnings per share

$

1.01

$

0.30

$

1.52

$

0.27

Basic weighted average common shares outstanding   


80,925


80,351


80,812


80,253

Diluted earnings per share

$

0.99

$

0.30

$

1.49

$

0.26

Diluted weighted average common shares outstanding   


82,292


81,266


82,226


81,043