NV5 Announces First Quarter Results and Raises Guidance
NV5 Global, Inc. reported strong first-quarter results, exceeding revenue and profitability expectations, with 73% growth in cash flows from operations compared to the previous year. The company is experiencing significant revenue growth in AI data center services and has become a leader in infrastructure design for this market. With 8% organic growth, NV5 completed four acquisitions in 2024 to enhance its operations. The company raised its 2024 gross revenue and EPS guidance, with gross revenue expected to be between $937 million and $942 million and GAAP EPS between $2.87 and $2.93.
Strong first-quarter results with 73% growth in cash flows from operations compared to the previous year.
Significant revenue growth in AI data center services, establishing NV5 as a leader in infrastructure design for this market.
Completed four acquisitions in 2024 to enhance operations and expand service offerings.
Raised 2024 gross revenue guidance to $937-942 million and GAAP EPS guidance to $2.87-2.93.
Impact of Federal continuing resolution on fourth quarter of the previous year affected operating margins.
First quarter net income decreased to $0.4 million compared to $5.9 million in the previous year.
GAAP EPS decreased to $0.03 per share compared to $0.39 per share in the previous year.
Adjusted EPS decreased to $0.66 per share compared to $0.88 per share in the previous year.
Insights
HOLLYWOOD, Fla., May 08, 2024 (GLOBE NEWSWIRE) -- NV5 Global, Inc. (Nasdaq GS: NVEE) ("NV5" or the "Company"), a provider of technology, conformity assessment, consulting solutions, and software applications, today reported financial results for the first quarter ended March 30, 2024.
"NV5 delivered strong first quarter results in revenue and profitability, exceeding our budget and analyst consensus for revenue and growing cash flows from operations
Our accelerated organic growth initiative has resulted in
First Quarter 2024 Results
The Company's cash flows grew
The Federal continuing resolution that impacted the fourth quarter of last year and much of the first quarter of this year is now behind us. As a result, we have raised 2024 guidance for revenue and earnings per share.
- Gross revenue guidance for the full year 2024 is now between
$937 million and$942 million , an increase from$930 million to$935 million . - 2024 GAAP EPS guidance is now between
$2.87 per share and$2.93 per share, an increase from$2.86 per share to$2.92 per share. - 2024 Adjusted EPS guidance has been raised to
$5.05 per share to$5.11 per share, an increase from$5.00 per share to$5.06 per share.
Due to our M&A activity, our intangible asset amortization has increased by
Our Adjusted EBITDA increased
_______________
1 Based on revenue most applicable to specific business line (gross revenue or gross revenue generated by internal labor) and excluding revenue from two smaller businesses not accepting new contracts.
Use of Non-GAAP Financial Measures; Comparability of Certain Measures
Earnings before interest, taxes, depreciation, and amortization (“EBITDA”) is not a measure of financial performance under GAAP. Adjusted EBITDA reflects adjustments to EBITDA to eliminate stock-based compensation expense and acquisition-related costs. Management believes adjusted EBITDA, in addition to operating profit, Net Income, and other GAAP measures, is a useful indicator of our financial and operating performance and our ability to generate cash flows from operations that are available for taxes, capital expenditures, and debt service. A reconciliation of Net Income, as reported in accordance with GAAP, to adjusted EBITDA is provided at the end of this news release.
Adjusted earnings per diluted share (“Adjusted EPS”) is not a measure of financial performance under GAAP. Adjusted EPS reflects adjustments to reported diluted earnings per share (“GAAP EPS”) to eliminate amortization expense of intangible assets from acquisitions and acquisition-related costs, net of tax benefits. As we continue our acquisition strategy, the growth in Adjusted EPS may increase at a greater rate than GAAP EPS. A reconciliation of GAAP EPS to Adjusted EPS is provided at the end of this news release.
Our definition of Adjusted EBITDA and Adjusted EPS may differ from other companies reporting similarly named measures. These measures should be considered in addition to, and not as a substitute for, or superior to, other measures of financial performance prepared in accordance with GAAP, such as Net Income, and Diluted Earnings per Share. In addition, when presenting forward-looking non-GAAP metrics, we are unable to provide quantitative reconciliations to the most closely correlated GAAP measure due to the uncertainty in the timing, amount or nature of any adjustments, which could be material in any period.
Conference Call
NV5 will host a conference call to discuss its first quarter 2024 financial results at 4:30 p.m. (Eastern Time) on May 8, 2024. The accompanying presentation for the call is available by visiting http://ir.nv5.com.
Date: | Wednesday, May 8, 2024 | |
Time: | 4:30 p.m. Eastern | |
Toll-free dial-in number: | +1 800-715-9871 | |
International dial-in number: | +1 646-307-1963 | |
Conference ID: | 2719957 | |
Webcast: | http://ir.nv5.com |
Please dial-in at least 5-10 minutes prior to the start time to allow the operator to log your name and connect you to the conference.
The conference call will be webcast live and available for replay via the “Investors” section of the NV5 website.
About NV5
NV5 Global, Inc. (NASDAQ GS: NVEE) is a provider of technology, conformity assessment, consulting solutions, and software applications for public and private sector clients supporting sustainable infrastructure, utility, and building assets and systems. The Company focuses on multiple verticals: construction quality assurance, infrastructure engineering, utility services, buildings & technology, environmental health sciences, and geospatial technology services to deliver innovative, sustainable solutions to complex issues and improve lives in our communities. NV5 operates out of more than 100 offices nationwide and internationally. For additional information, please visit the Company’s website at www.NV5.com. Also, visit the Company on LinkedIn, Twitter, Facebook, and Instagram.
Forward-Looking Statements
This news release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. The Company cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward-looking statements contained in this news release and on the conference call. Such factors include: (a) changes in demand from the local and state government and private clients that we serve; (b) general economic conditions, nationally and globally, and their effect on the market for our services; (c) competitive pressures and trends in our industry and our ability to successfully compete with our competitors; (d) changes in laws, regulations, or policies; and (e) the “Risk Factors” set forth in the Company’s most recent SEC filings. All forward-looking statements are based on information available to the Company on the date hereof, and the Company assumes no obligation to update such statements, except as required by law.
Investor Relations Contact
NV5 Global, Inc.
Jack Cochran
Vice President, Marketing & Investor Relations
Tel: +1-954-637-8048
Email: ir@nv5.com
Source: NV5 Global, Inc.
NV5 GLOBAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except share data) | |||||||
March 30, 2024 | December 30, 2023 | ||||||
Assets | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 44,766 | $ | 44,824 | |||
Billed receivables, net | 149,206 | 152,593 | |||||
Unbilled receivables, net | 120,705 | 113,271 | |||||
Prepaid expenses and other current assets | 17,435 | 18,376 | |||||
Total current assets | 332,112 | 329,064 | |||||
Property and equipment, net | 54,103 | 50,268 | |||||
Right-of-use lease assets, net | 37,942 | 36,836 | |||||
Intangible assets, net | 246,074 | 226,702 | |||||
Goodwill | 536,908 | 524,573 | |||||
Deferred income tax assets, net | 2,339 | — | |||||
Other assets | 2,479 | 3,149 | |||||
Total Assets | $ | 1,211,957 | $ | 1,170,592 | |||
Liabilities and Stockholders’ Equity | |||||||
Current liabilities: | |||||||
Accounts payable | $ | 52,781 | $ | 54,865 | |||
Accrued liabilities | 53,999 | 47,423 | |||||
Billings in excess of costs and estimated earnings on uncompleted contracts | 40,212 | 41,679 | |||||
Other current liabilities | 2,167 | 2,263 | |||||
Current portion of contingent consideration | 3,436 | 3,922 | |||||
Current portion of notes payable and other obligations | 9,634 | 9,267 | |||||
Total current liabilities | 162,229 | 159,419 | |||||
Contingent consideration, less current portion | 1,610 | 143 | |||||
Other long-term liabilities | 27,564 | 26,930 | |||||
Notes payable and other obligations, less current portion | 237,274 | 205,468 | |||||
Deferred income tax liabilities, net | — | 2,837 | |||||
Total liabilities | 428,677 | 394,797 | |||||
Commitments and contingencies | |||||||
Stockholders’ equity: | |||||||
Preferred stock, | — | — | |||||
Common stock, | 160 | 159 | |||||
Additional paid-in capital | 515,833 | 508,256 | |||||
Accumulated other comprehensive loss | (519 | ) | (18 | ) | |||
Retained earnings | 267,806 | 267,398 | |||||
Total stockholders’ equity | 783,280 | 775,795 | |||||
Total liabilities and stockholders’ equity | $ | 1,211,957 | $ | 1,170,592 | |||
NV5 GLOBAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF NET INCOME AND COMPREHENSIVE INCOME (LOSS) (UNAUDITED) (in thousands, except share data) | |||||||
Three Months Ended | |||||||
March 30, 2024 | April 1, 2023 | ||||||
Gross revenues | $ | 213,295 | $ | 184,317 | |||
Direct costs: | |||||||
Salaries and wages | 56,454 | 48,384 | |||||
Sub-consultant services | 31,260 | 27,615 | |||||
Other direct costs | 12,753 | 12,320 | |||||
Total direct costs | 100,467 | 88,319 | |||||
Gross profit | 112,828 | 95,998 | |||||
Operating expenses: | |||||||
Salaries and wages, payroll taxes, and benefits | 65,434 | 52,672 | |||||
General and administrative | 22,243 | 17,920 | |||||
Facilities and facilities related | 5,960 | 5,374 | |||||
Depreciation and amortization | 14,482 | 11,047 | |||||
Total operating expenses | 108,119 | 87,013 | |||||
Income from operations | 4,709 | 8,985 | |||||
Interest expense | (4,191 | ) | (1,581 | ) | |||
Income before income tax expense | 518 | 7,404 | |||||
Income tax expense | (110 | ) | (1,457 | ) | |||
Net income | $ | 408 | $ | 5,947 | |||
Earnings per share: | |||||||
Basic | $ | 0.03 | $ | 0.40 | |||
Diluted | $ | 0.03 | $ | 0.39 | |||
Weighted average common shares outstanding: | |||||||
Basic | 15,267,151 | 14,883,487 | |||||
Diluted | 15,634,026 | 15,383,437 | |||||
Comprehensive income (loss): | |||||||
Net income | $ | 408 | $ | 5,947 | |||
Foreign currency translation losses, net of tax | (501 | ) | — | ||||
Comprehensive income (loss) | $ | (93 | ) | $ | 5,947 | ||
NV5 GLOBAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) | |||||||
Three Months Ended | |||||||
March 30, 2024 | April 1, 2023 | ||||||
Cash flows from operating activities: | |||||||
Net income | $ | 408 | $ | 5,947 | |||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||
Depreciation and amortization | 16,043 | 12,302 | |||||
Non-cash lease expense | 3,293 | 3,286 | |||||
Provision for doubtful accounts | 491 | 240 | |||||
Stock-based compensation | 6,666 | 5,826 | |||||
Change in fair value of contingent consideration | — | (859 | ) | ||||
Gain on disposals of property and equipment | (3 | ) | (23 | ) | |||
Other | (67 | ) | — | ||||
Deferred income taxes | (5,175 | ) | (5,603 | ) | |||
Amortization of debt issuance costs | 185 | 194 | |||||
Changes in operating assets and liabilities, net of impact of acquisitions: | |||||||
Billed receivables | 7,283 | 9,560 | |||||
Unbilled receivables | (5,727 | ) | (13,999 | ) | |||
Prepaid expenses and other assets | 1,496 | 4,857 | |||||
Accounts payable | (3,584 | ) | (15,884 | ) | |||
Accrued liabilities and other long-term liabilities | 675 | 2,375 | |||||
Billings in excess of costs and estimated earnings on uncompleted contracts | (1,516 | ) | 3,906 | ||||
Contingent consideration | (815 | ) | (800 | ) | |||
Other current liabilities | (99 | ) | (43 | ) | |||
Net cash provided by operating activities | 19,554 | 11,282 | |||||
Cash flows from investing activities: | |||||||
Cash paid for acquisitions (net of cash received from acquisitions) | (45,334 | ) | (117,587 | ) | |||
Proceeds from sale of assets | 22 | — | |||||
Purchase of property and equipment | (3,673 | ) | (6,110 | ) | |||
Net cash used in investing activities | (48,985 | ) | (123,697 | ) | |||
Cash flows from financing activities: | |||||||
Borrowings from Senior Credit Facility | 35,000 | 110,000 | |||||
Payments on notes payable and other obligations | (4,380 | ) | (4,085 | ) | |||
Payments of contingent consideration | (1,025 | ) | (700 | ) | |||
Net cash provided by financing activities | 29,595 | 105,215 | |||||
Effect of exchange rate changes on cash and cash equivalents | (222 | ) | — | ||||
Net decrease in cash and cash equivalents | (58 | ) | (7,200 | ) | |||
Cash and cash equivalents – beginning of period | 44,824 | 38,541 | |||||
Cash and cash equivalents – end of period | $ | 44,766 | $ | 31,341 | |||
NV5 GLOBAL, INC. AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO COMPARABLE GAAP FINANCIAL MEASURES (UNAUDITED) (in thousands, except share data) |
RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA
Three Months Ended | ||||||||
March 30, 2024 | April 1, 2023 | |||||||
Net Income | $ | 408 | $ | 5,947 | ||||
Add: | Interest expense | 4,191 | 1,581 | |||||
Income tax expense | 110 | 1,457 | ||||||
Depreciation and amortization | 16,043 | 12,302 | ||||||
Stock-based compensation | 6,666 | 5,826 | ||||||
Acquisition-related costs* | 1,312 | 632 | ||||||
Adjusted EBITDA | $ | 28,730 | $ | 27,745 | ||||
* Acquisition-related costs include contingent consideration fair value adjustments.
RECONCILIATION OF GAAP EPS TO ADJUSTED EPS
Three Months Ended | ||||||||
March 30, 2024 | April 1, 2023 | |||||||
Net Income - per diluted share | $ | 0.03 | $ | 0.39 | ||||
Per diluted share adjustments: | ||||||||
Add: | Amortization expense of intangible assets and acquisition-related costs | 0.84 | 0.65 | |||||
Income tax expense | (0.21 | ) | (0.16 | ) | ||||
Adjusted EPS | $ | 0.66 | $ | 0.88 | ||||
FAQ
What were NV5's first-quarter financial results for 2024?
How much did NV5 raise their 2024 guidance for gross revenues and EPS?
What acquisitions did NV5 complete in 2024?
What sectors are contributing to NV5's revenue growth?