Willdan Group (WLDN) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 2024 results, surpassing consensus and internal expectations, with 18.4% year-over-year revenue growth and strong organic growth and profitability across Energy and Engineering and Consulting segments.

• Net income rose to $4.6 million in Q2 2024 from $0.4 million in Q2 2023, reflecting improved operating performance and a lower effective tax rate.

• Raised full-year financial targets due to robust first-half performance and positive momentum, with continued optimism for accelerated growth including through M&A.

• Demand remains strong across government, utility, and commercial clients, with double-digit organic growth in government work and notable contract wins for Meta, State of Virginia, and City of Paramount.

• Positioned to benefit from accelerating electricity load growth driven by electrification and AI data center expansion.

Financial highlights

• Q2 2024 contract revenue up 18.4% year-over-year to $141 million; net revenue up 17% to $73 million.

• Adjusted EBITDA increased 56.2% to $12.8 million (17.7% of net revenue); GAAP and Adjusted EPS both more than doubled year-over-year.

• Net income for Q2 2024: $4.6 million; GAAP diluted EPS $0.33; Adjusted diluted EPS $0.55.

• First half contract revenue up 18.9% to $263.5 million; net income $7.5 million; Adjusted EBITDA $23.9 million.

• Net debt reduced from $75 million to $50 million since year-end 2023; cash and cash equivalents at $44.3 million as of June 28, 2024.

Outlook and guidance

• Raised 2024 guidance: net revenue $280–$290 million, Adjusted EBITDA $50–$52 million, Adjusted diluted EPS $2.00–$2.10.

• Guidance assumes 14% effective tax rate and 14.2 million shares outstanding, with no future acquisitions included.

• Management expects cash, cash equivalents, and available borrowings to be sufficient for at least the next 12 months.

• No material changes to risk factors or business outlook disclosed for the remainder of 2024.

• Continued optimism for accelerated growth, including through M&A.