NV5 Global (NVEE) Q2 2024 earnings summary

Executive summary

• Q2 2024 gross revenues grew 6.1% year-over-year to $236.3M, with strong organic growth and robust performance across all segments, though net income declined to $7.9M from $15.4M due to higher operating and interest expenses and non-recurring items.

• Adjusted EBITDA increased 10% to $38.5M, with margin up to 16.3%, and adjusted EPS was $1.24, slightly down from $1.29 due to higher share count.

• Backlog reached $877M, up 5% sequentially and 9% year-over-year, reflecting sustained demand in infrastructure, geospatial, and buildings/technology.

• Five acquisitions completed in 2024 for $64.3M, funded with cash, stock, and contingent earn-outs, expanding utility O&M, staffing, and water resources services.

• Raised full-year 2024 guidance for gross revenues to $944–$950M, GAAP EPS to $2.87–$2.93, and adjusted EPS to $5.13–$5.20, driven by operational strength and technology leadership.

Financial highlights

• Q2 2024 gross revenues: $236.3M (+6.1% YoY); gross profit rose 12% to $123.3M; gross margin expanded to 52.2%.

• Net income was $7.9M (down from $15.4M in Q2 2023); GAAP diluted EPS was $0.50 (vs. $1.00 prior year); adjusted EPS was $1.24 (vs. $1.29 prior year).

• Adjusted EBITDA margin improved to 16.3% from 15.7% year-over-year.

• Cash from operations was negative $11.3M in Q2, but year-to-date cash from operations was $8.2M, down from $25.5M prior year.

• Operating expenses rose 24% YoY in Q2, mainly from higher payroll, G&A, and amortization; interest expense increased due to higher rates and borrowings.

Outlook and guidance

• Full-year 2024 revenue guidance raised to $944–$950M, with organic growth expected at 6–10%.

• Full-year GAAP EPS guidance is $2.87–$2.93; adjusted EPS guidance is $5.13–$5.20.

• EBITDA margin expected to approach 17% for the full year, with geospatial segment driving margin improvement.

• Guidance excludes contributions from pending acquisitions.

• Management expects liquidity from operations, cash, and credit facility to be sufficient for at least the next 12 months.