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acceleration, accurate, acquire, acquirer, acre, adjacent, aggregated, alleged, allocation, Amie, amortize, amortized, amortizing, apply, apportioned, arose, assumption, awarded, bridge, brought, calculating, capturing, carefully, charged, clarifying, climate, commencing, commodity, compensatory, computer, concrete, conducting, conform, conformity, consistency, constituted, constructed, consumed, contingency, Court, creating, deficiency, delay, detected, disruption, District, Division, documentary, drawn, enable, enforcement, enhancing, enjoyment, enterprise, erosion, established, evidence, excavation, expanding, expired, external, failure, fairly, farm, firm, floating, flowed, focusing, forma, found, gain, Georgia, grid, half, high, highly, hire, history, IEAC, implement, implemented, implementing, impracticability, improper, indemnification, ineffective, insignificant, INTREN, involving, ITGC, judgment, jury, lake, land, law, leasehold, light, located, low, merger, Middle, misstatement, negligence, Notwithstanding, nuisance, owner, pattern, personnel, precision, predominantly, predominately, present, pressure, prevent, prevented, pro, processing, procure, production, proper, punitive, purpose, quantify, Ranch, reclassified, reducing, reliable, relief, remediate, remediated, repurchased, requirement, sedimentary, segregation, set, sewer, Shaun, Silicon, skilled, soil, specialty, SRC, streamlining, strive, suit, supplemental, tract, transportation, trial, underwent, unemployment, unexercised, user, validation, variance, verdict, viability, VIE, voltage, Westwood
Financial report summary
?Competition
Jacobs Solutions • Dycom Industries • MYR • Quanta Services • Primoris Services • AmeriCrew • Mammoth Energy ServicesRisks
- Risks Related to the Industries We Serve
- Changes to laws, governmental regulations and policies, including those pertaining to governmental permitting and tax incentives, could affect demand for our services or cause delays in the timing of projects or cancellations of current or planned future projects. Additionally, demand for construction services depends on industry activity and expenditure levels, which can be affected by a variety of factors, including the effects of climate-related matters. Our inability or failure to adjust to such changes or activity could result in decreased demand for our services and adversely affect our results of operations, cash flows and liquidity.
- Unfavorable market conditions, including from rising or elevated levels of inflation or interest rates, supply chain disruptions or political, regulatory or market uncertainty, including economic downturns, could reduce capital expenditures in the industries we serve or could adversely affect our customers and result in decreased demand for our services.
- An impairment of the financial condition of one or more of our customers due to adverse market or other conditions could hinder their ability to pay us on a timely basis.
- The industries we serve are highly competitive and subject to rapid technological and regulatory changes, as well as customer consolidation, any of which could result in decreased demand for our services and adversely affect our results of operations, cash flows and liquidity.
- Risks Related to Our Business and Operations
- Our failure to properly manage projects, or project delays, including those resulting from difficult work sites and environments, permitting issues and the availability of materials or equipment could result in additional costs or claims, which could have a material adverse effect on our operating results, cash flows and liquidity.
- Our failure to recover adequately on claims against project owners, subcontractors or suppliers for payment or performance could have a material adverse effect on our financial results.
- We may not accurately estimate the costs associated with services provided under fixed price contracts, which could adversely affect our profitability, results of operations and cash flows.
- Amounts included in our backlog may not result in actual revenue or translate into profits. Our backlog is subject to cancellation and unexpected adjustments and, therefore, is an uncertain indicator of future operating results.
- We maintain a workforce based upon current and anticipated workloads, and could incur significant costs and reduced profitability from underutilization of our workforce if the level of services we provide is significantly reduced, or if contract awards are delayed or not received.
- We derive a significant portion of our revenue from a few customers, and the loss of one or more of these customers, or a reduction in their demand for our services, could impair our financial performance. In addition, many of our contracts, including our service agreements, do not obligate our customers to undertake any infrastructure projects or other work with us, and most of our contracts may be canceled on short or no advance notice.
- If we are unable to attract and retain qualified managers and skilled employees, we will be unable to operate efficiently, which could reduce our revenue, profitability and liquidity.
- Our financial results are based, in part, upon estimates and assumptions that may differ from actual results.
- Our business is subject to operational risk, including from occupational health and/or safety incidents due to operational, physical and/or environmental hazards, which could result in substantial liabilities and weaken our financial condition.
- We are self-insured against many potential liabilities.
- In the ordinary course of our business, we may become subject to lawsuits, indemnity or other claims, which could materially and adversely affect our business, results of operations and cash flows.
- Our business is seasonal and affected by the spending patterns of our customers, project schedules, weather conditions, climate-related events, regulatory matters, including timing of governmental permitting, and market conditions, all of which exposes us to variations in quarterly results.
- We rely on information, communications and data systems in our operations. Systems and information technology interruptions and/or data security breaches could adversely affect our ability to operate, our operating results, our data security or our reputation.
- We could incur goodwill and intangible asset impairment charges, which could harm our profitability.
- A failure of our internal control over financial reporting could materially affect our business.
- Our subcontractors and suppliers may fail or be unable to satisfy their obligations to us or other parties, or we may be unable to maintain these relationships, either of which could have a material adverse effect on our results of operations, cash flows and liquidity.
- The use of a unionized workforce and any related obligations could subject us to liabilities that could adversely affect our liquidity, cash flows and results of operations.
- We may have additional tax liabilities associated with our operations.
- Risks Related to Strategic Transactions and Foreign Operations
- Acquisitions and strategic investments involve risks, including from integration of acquired businesses into our operations, which, if unsuccessful, could negatively affect our operating results, cash flows and liquidity and may not enhance shareholder value.
- Our participation in strategic arrangements, including joint ventures and equity investments, exposes us to numerous risks.
- Our operations in international markets, or future efforts to expand into additional international markets, may not be successful and could expose us to risks, including failure to comply with the U.S. Foreign Corrupt Practices Act and/or similar anti-bribery laws, which could harm our business and prospects.
- Risks Related to Regulation and Compliance
- A failure to comply with environmental laws could result in significant liabilities or harm our reputation, and new environmental laws or regulations could adversely affect our business.
- Our operations could affect the environment or cause exposure to hazardous substances. In addition, our properties could have environmental contamination, which could result in material liabilities.
- We are subject to climate-related risks and risks associated with rapidly evolving regulatory and stakeholder focus with respect to environmental, social and governance (“ESG”) matters.
- Our failure to comply with the regulations of federal, state and local agencies that oversee compliance with safety and transportation regulations could reduce our revenue, profitability and liquidity.
- Risks Related to Financing Our Business
- We have a significant amount of debt, which could adversely affect our business, financial condition and results of operations or could affect our ability to access capital markets in the future. In addition, our debt contains restrictive covenants that may prevent us from engaging in transactions that might benefit us.
- We may be unable to obtain sufficient bonding capacity to support certain service offerings, and the need for performance and surety bonds could reduce availability under our credit facility.
- Risks Related to Our Common Stock
- There may be future sales of our common stock or other dilution of our equity that could adversely affect the market price of our common stock and could dilute the ownership interests of our shareholders and/or lead to volatility in our common stock price.
- The market price of our common stock has been, and may continue to be, highly volatile.
- A small number of our existing shareholders have the ability to influence major corporate decisions.
- Our articles of incorporation and certain provisions of Florida law contain anti-takeover provisions that may make it more difficult to effect a change in our control.
Management Discussion
- (a) For the three month period ended March 31, 2023, Communications, Clean Energy and Infrastructure and Power Delivery EBITDA included $8.9 million, $5.2 million and $1.7 million, respectively, of acquisition and integration costs related to certain acquisitions, as described in “Non-U.S. GAAP Financial Measures” discussion below, and Corporate EBITDA included $1.3 million of such costs. These acquisition and integration activities were completed in the fourth quarter of 2023.
- Revenue. For the three month period ended March 31, 2024, consolidated revenue totaled $2,687 million as compared with $2,585 million for the same period in 2023, an increase of approximately $102 million, or 4%. Revenue in our Oil and Gas segment increased by approximately $377 million, or 147%, whereas revenue decreased in our Power Delivery segment by approximately $138 million, or 20%, in our Communications segment by approximately $74 million, or 9%, and in our Clean Energy and Infrastructure segment by approximately $71 million, or 9%. See below for details of revenue by segment.
- Communications Segment. Communications revenue was $733 million for the three month period ended March 31, 2024 as compared with $807 million for the same period in 2023, a decrease of $74 million, or 9%. The decrease in revenue was driven primarily by lower levels of wireless, wireline and install-to-the-home project activity due, in part, to customer project timing in our wireless and wireline businesses and, for our install-to-the-home activities, changes in consumer behavior resulting in lower demand. These decreases were offset, in part, by an increase in utility project work.