Primoris Services (PRIM) Q3 2024 earnings summary

Executive summary

• Achieved record Q3 2024 revenue of $1.65 billion, net income of $58.4 million, and backlog of $11.3 billion, driven by strong performance in Energy and Utilities segments and robust bookings in renewables and industrials.

• Utilities segment delivered higher revenues and improved margins, while Energy segment growth was led by renewables, despite some margin pressure from weather and project timing.

• Communications activity surged due to fiber investments and data center build-outs, offsetting delays in federal rural fiber programs.

• Raised full-year 2024 guidance for EPS ($2.85–$3.00), Adjusted EPS ($3.40–$3.55), and Adjusted EBITDA ($405–$420 million), reflecting confidence in project execution and profitability.

• Quarterly cash dividend increased to $0.08 per share, with strong cash flow supporting dividend growth and debt reduction.

Financial highlights

• Q3 2024 revenue was $1,649.1 million, up 7.8% year-over-year; gross profit rose 14.2% to $198.6 million, with gross margin improving to 12.0%.

• Net income increased to $58.4 million, diluted EPS to $1.07, and Adjusted EPS to $1.22.

• Adjusted EBITDA reached $127.7 million, up from $120.0 million in Q3 2023.

• Cash and cash equivalents rose to $352.7 million; operating cash flow for nine months was $210.1 million.

• Net interest expense decreased to $17.9 million; net long-term debt reduced to $827.0 million.

Outlook and guidance

• Full-year 2024 EPS guidance raised to $2.85–$3.00; Adjusted EPS to $3.40–$3.55; Adjusted EBITDA to $405–$420 million.

• SG&A expense targeted in the low 6% range of revenue; effective tax rate expected at 29%.

• Utilities gross margin targeted at 9–11%, Energy at 10–12%.

• Backlog supports strong revenue visibility for the next 12–18 months, with renewables backlog approaching $3 billion.

• Q4 capital expenditures projected at $10–$20 million; full-year capex expected at $108–$118 million.