(Source: PRNewswire-FirstCall)
CORAL GABLES, Fla., April 29 /PRNewswire-FirstCall/ -- MasTec, Inc. today announced that revenue for the quarter ended March 31, 2009 was $342 million and net income was $11.9 million or $0.16 per diluted share compared with revenue of $262 million and net income of $7.8 million, or $0.12 per diluted share for the prior year quarter. This represents an earnings increase of 53% on a 31% increase in revenue over the prior year.
The Company continued to focus on margin improvement and cost containment. First quarter gross margin improved to 15.0% from 13.4% from the previous year's quarter and net income margin improved to 3.5% from 3.0% in 2008. The margin for earnings before interest, taxes, depreciation and amortization, or EBITDA margin, increased 240 basis points to 8.3% for the quarter just ended, up from 5.9% in the first quarter of 2008.
As a result of the improved financial performance, MasTec's balance sheet and cash flow from operations remained strong. At the end of the first quarter, the Company had $131 million in cash, cash equivalents, securities available for sale and availability on our bank line of credit. Net cash provided by operating activities increased to $49 million compared with $7 million in the prior year quarter.
Jose R. Mas, MasTec's President and Chief Executive Officer, commented, "In spite of our country's economic challenges, we had an excellent first quarter. Our diversification efforts, along with our margin improvement initiatives over the past 18 months, are having a positive impact on both our earnings and our long term outlook. Today, we are in the unique position to take advantage of the opportunities within the growing infrastructure sectors we serve, including renewable energy, transmission line construction, wireless expansion and broadband connectivity."
MasTec's 2009 earnings guidance remains unchanged, with diluted earnings per share estimated to be between $1.05 and $1.15 per share. Earnings per diluted share for the year is negatively impacted by large increases in the non-cash amortization expense for acquisition-related intangible assets and by a large increase in the mostly non-cash book tax rate. The Company now expects revenue of approximately $1.85 billion for the year.
Revenue for the second quarter of 2009 is expected to be approximately $375 million, with earnings per diluted share of $0.22 to $0.24.
Our guidance assumes a continued difficult economy and does not include any additional impact of our legacy litigation or any mark-to-market valuation adjustments on auction rate securities, either positive or negative.
Management will hold a conference call to discuss results of operations for the quarter ended March 31, 2009 on Thursday, April 30, 2009 at 9:00 a.m. Eastern time. The call-in number for the conference call is (913) 312-1412 and the replay number is (719) 457-0820, with a pass code of 5946684. The replay will run for 30 days. Additionally, the call will be broadcast live over the Internet and can be accessed and replayed through the investor relations section of the Company's website at http://www.mastec.com/.
Summary financials for the quarters are as follows: Condensed Unaudited Consolidated Statement of Operations (In thousands, except per share amounts) For the Three Months Ended March 31, 2009 2008 Revenue $342,119 $261,992 Costs of revenue, excluding depreciation and amortization 290,926 226,844 Depreciation and amortization 10,643 5,028 General and administrative expenses, including non-cash stock compensation expense of $822 in 2009 and $844 in 2008 23,255 19,806 Interest expense, net of interest income 5,762 2,496 Other income, net 497 151 Income from continuing operations before income taxes 12,030 7,969 Income taxes (101) (33) Income from continuing operations 11,929 7,936 Loss from discontinued operations, net of tax - (155) Net income $11,929 $7,781 Basic net income per share: Continuing operations $0.16 $0.12 Discontinued operations - - Total basic net income per share $0.16 $0.12 Basic weighted average common shares outstanding 75,546 67,187 Diluted net income per share: Continuing operations $0.16 $0.12 Discontinued operations - - Total diluted net income per share $0.16 $0.12 76,565 67,585 Diluted weighted average common shares outstanding Condensed Unaudited Consolidated Balance Sheets (In thousands) March 31, December 31, 2009 2008 Assets Total current assets $378,107 $439,365 Property and equipment, net 155,185 158,013 Goodwill and other intangibles, net 418,107 420,604 Deferred taxes, net 16,793 25,165 Securities available for sale 21,009 20,580 Other assets 27,451 27,170 Total assets $1,016,652 $1,090,897 Liabilities and Shareholders' Equity Current liabilities $273,017 $334,048 Other liabilities 25,199 26,305 Long-term debt 261,202 287,454 Total shareholders' equity 457,234 443,090 Total liabilities and shareholders' equity $1,016,652 $1,090,897 Condensed Unaudited Consolidated Statements of Cash Flows (In thousands) For the Three Months Ended March 31, 2009 2008 Cash flows from operating activities: Net cash provided by operating activities $49,300 $7,334 Net cash (used in) provided by investing activities (13,101) 835 Net cash (used in) financing activities (25,946) (934) Net increase in cash and cash equivalents 10,253 7,235 Net effect of currency translation on cash 107 - Cash and cash equivalents - beginning of period 47,263 74,288 Cash and cash equivalents - end of period $57,623 $81,523 Reconciliation of Non-GAAP Disclosures-Unaudited (In millions, except for percentages and per share data) Three Months Ended Three Months Ended ------------------ ------------------ March 31, 2009 March 31, 2008 -------------- -------------- Total EBITDA Total EBITDA EBITDA Reconciliation Margin Margin GAAP Net income $11.9 3.5% $7.8 3.0% Loss from discontinued operations - 0.0% 0.2 0.0% Interest, net 5.8 1.7% 2.5 1.0% Taxes 0.1 0.0% 0.0 0.0% Depreciation and amortization 10.6 3.1% 5.0 1.9% Earnings before interest, taxes, depreciation and amortization (EBITDA) $28.4 8.3% $15.5 5.9% Years Ended EBITDA Reconciliation 2009 2008 GAAP Net Income $85-93 $66 Loss from discontinued operations, net of taxes - (1) Income from continuing operations 85-93 $67 Interest, net 26-28 14 Income tax provision 23-29 1 Amortization 9-10 4 Depreciation 37-40 24 Earnings from continuing operations before interest, taxes, amortization and depreciation (EBITDA) $180-200 $110
MasTec is a leading specialty contractor operating mainly throughout the United States across a range of industries. The Company's core activities are the building, installation, maintenance and upgrade of utility and communication infrastructure systems. The Company's corporate website is located at http://www.mastec.com/.
This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act. These statements are based on management's current expectations and are subject to a number of risks, uncertainties, and assumptions, which may, among other things, cause our revenues, margins and earnings per share to differ from that projected. Such risks, uncertainties and assumptions may include further or continued economic downturns, reduced capital expenditures, reduced financing availability, customer consolidation and technological and regulatory changes in the industries we serve; market conditions, technical and regulatory changes that affect us or our customers' industries; our ability to retain qualified personnel and key management from acquired businesses and integrate acquisitions with MasTec within the expected timeframes and achieve the revenue, cost savings and earnings levels from the acquisition at or above the levels projected; the impact of the American Recovery and Reinvestment Act of 2009 and any similar local or state regulations affecting renewable energy, electrical transmission, broadband expansion and related projects and expenditures; our ability to attract and retain qualified managers and skilled employees; increases in fuel, maintenance, materials, labor and other costs; any liquidity issues related to our securities held for sale; material changes in estimates for legal costs or case settlements; adverse determinations on any claim, lawsuit or proceeding; the highly competitive nature of our industry; our dependence on a limited number of customers; the ability of our customers to terminate or reduce the amount of work, or in some cases prices paid for services under many of our contracts; the adequacy of our insurance, legal and other reserves and allowances for doubtful accounts; any exposure related to our divested state Department of Transportation projects and assets; restrictions imposed by our credit facility, senior notes and any future loans or securities; any dilution or stock price volatility which shareholders may experience in connection with shares we may issue as consideration for earn-out obligations entered into, or as a result of conversions of convertible stock issued, in connection with past or future acquisitions, the outcome of our plans for future operations, growth, and services, including backlog and acquisitions; as well as other risks detailed in our filings with the Securities and Exchange Commission. Actual results may differ significantly from results expressed or implied in these statements. We do not undertake any obligation to update forward-looking statements.
MasTec, Inc.
CONTACT: J. Marc Lewis, Vice President-Investor Relations, MasTec, Inc.,+1-305-406-1815, or +1-305-406-1886 fax, marc.lewis@mastec.com
Web Site: http://www.mastec.com/
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