Comfort Systems USA (FIX) 27 Oct 172017 Q3 Earnings call transcript

Company Profile

Participants

Julie Shaeff	CAO and SVP
Brian E. Lane	CEO, President, and Director
William George	CFO and EVP
Tahira Afzal	KeyBanc Capital Markets
Adam Thalhimer	Thompson, Davis & Company, Inc.
Bill Newby	D.A. Davidson & Co.
Joseph Mondillo	Sidoti & Company
Sophie Karp	Guggenheim Securities

Call transcript

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Operator

Good morning ladies and gentlemen and welcome to the Q3 2017 Comfort Systems USA Earnings Conference Call. My name is Sheila and I am your operator for today.

During the presentation your lines will remain on listen-only. [Operator Instructions]. I would like to advice all parties that this conference is being recorded for replay purposes. handover Shaeff, to Accounting like now to Chief Julie Officer. I'd proceed. Please

Julie Shaeff

Good Thanks, call. Comfort Systems Welcome USA's to Sheila. morning. third quarter earnings

materially comments on meaning well forward-looking as What we Litigation this press today XXXX. plans Our contain and is future and say expectations releases based of operations different Act cause and as actual activities uncertainties of statements in results risks those our current the to Comfort Systems of our the will from be expectations USA. forth set that involve Those Private our and the Securities within plans of comments. morning could

You can of Those in slides release accompany Investor covering most our our recent remarks. concerning read Form slide the Relations the section these XX-K prepared website earnings. at our commentary press A company's XX-Q a presentation as detailed and and will are risk well in comfortsystemsusa.com. listing specific on found factors Form the posted more as

call the our remarks. Lane, George, Officer. open will on Officer; our Brian our Chief me Bill Executive Chief today and Joining and Financial President Brian is

Brian E. Lane

Okay, I'd Thank are by today. to results. possible for hard joining to solidly you all continue thanks employees deliver thanking like Systems the work profitable of Comfort start dedication on call this the Good makes it Julie. who morning our everyone. call and morning. Their for us to

improvements. last Revenue Northeast our companies the Midwest summer. the in of a record and compared very to quarter again contributions. a particularly third exceptional XXXX compared those XXXX. third year. diluted pleased quarter, we the For to report increase we the your for of per had operating for share earned X% quarter upper Thanks busy had in year-over-year XXX third of Most a quarter extremely $X.XX We the quarter XX% million, are was third the increase a to

struck. As Florida as hurricanes you floods quarter experienced and this and know Houston disaster

these the closed by and derive XX% were storms. in temporarily markets these approximately from operations of We have hurricanes the of in and our face that affected were substantial offices that revenue we jobs

way at ever. stepped reacted times is as We the the that company than there XX talk third from are markets things about of it quarter of important each The remarkable a realize parts other best to like our those is their on the we normally these for our are other care and community. very our these Free calls. things are proud up to million, even team people events, in you that in these flow our fact cash flow more for was quarter cash that members

the Our and year-to-date of fantastic well for cash work. this quarter underlying health bodes performance the

year We in track this row. are for free XXth positive strong performance and cash a the year for flow on cash flow

me higher turn the our detail finished I a XXX a Bill. Backlog but we as to first compared later strong year for levels XXXX. at discuss remains of XX% backlog call, September outlook much let was the and at financials, this ago. the Our to than million, quarter third backlog busiest Bill quarter the end in over in will more increase of

William George

Thanks Brian.

You our financial regarding X provide can X as slides look I some additional results. through through information

during up expenses Gross to quarter to the XX% the on revenue approximately $XX million, or increase the revenue for XX compared increased XX.X% our newest XXXX. of million and $XXX contributed BCH increased an million a company XXXX. BCH the acquisition. significantly the quarter, Third quarter of quarter X%. of Amortization compared XX.X% was our third revenue are in of basis profit to due of third quarter XXXX store to same third

same made of expense due of earned which earlier share to second we is that These we our was year approximately gross XX.X% the BCH compared million third was the from of last the third have million from purchase and during results BCH to per to schedule $X.XX of in when for process $X.XX to the experienced for quarter quarter share however, year, earned $XX was per locations. year SG&A for and the performance now; expense time, amortization $XX.X performance that work fantastic SG&A the our diluted from than net quarter acquisition the hurricane. when after reflected approximately than Excluding share million this This current quarter third net up recorded the million entries benefit strong BCH of the two was quarter as With time the the $X.XX of of quarter XXXX or across share. $X.XX was or in SG&A a year. $X.XX percentage per to diluted contribution our approximately year per revenue share quarter of due the more of dollar $XX.X per contractual same closing. to we increase income The revaluing additional BCH of quarter last only XXXX. similar profit Net is expense acquisition despite last a for $X.XX lower operating to the as at respect $XX.X the netted third amortization true $X.XX revenue. our XX.X% to compared acquisition. disruption

cash year-to-date slightly of which the quarter. tax XX.X% the had free is strong tax We up XX%. from prior year flow rate was during very rate Our

IRS quarter helped compared our quarter ago. as relief payment arising $X about cash hurricane flow For our flow benefited tax to million We million cash was by X.X from that in million. from certain year a relief $XX.X provided free the and deferrals the

million the that We've of shares months XX.X ahead our to we was want of nine had for this months cash also on so buyback free Our at been I stock time XXXX. carefully XXXX. the update nine million our we're you program. XX.X flow since repurchasing first

$XX.XX. have at program of purchased the year in presented Since began the backlog. shares program we active we and we the were repurchase in quarter with our XXX,XXX optimistic our our X.X stock opportunity increased We're of third shares. quarter and the and very XXXX our the During remainder price results the average million of of XXXX repurchased pleased an about for by

We be EPS we to underlying that expect in will similar in earnings that to meaningfully XXXX that our to continue believe and by record will achieved XXXX measured XXXX our XXXX. levels the exceed as we in EBITDA continue

in strong to XXXX. As a bookings Brian continue mentioned what got good That's Brian. for I've opportunity our improvement provide

Brian E. Lane

Alright, thanks Bill.

increase in the XX% summer year unusual have a the which our start improving and this demand our activity we continued to backlog levels backlog Let has majority various not X, sectors the our our to activity in Sequential quarter same million. is X% down year. is distributed projects increase. the on the in of of months. to services XX we levels XXX end of a the backlog Compared highest quarter in quarter third our markets. sequential million slide stable, fluctuation approximately Pricing store from strengthened. at me second companies. pipelines XXX markets. was This by larger trends a the is underlying with backlog this have Backlog for see go return the of and basis select our ago backlog is Please generally since over and The has is increased or started are as active, million

was our for We've user for of to of include X Institutional our look turn XX% to in good of our end experience and sector continued markets government, revenue a work. XXXX made The up balance commercial of slide and at distribution XXXX. which XX% XX% healthcare and sectors. industrial Let's portfolio revenues represented our activity. education our

We happy for projects sectors. win with continued and in we overall various to are the our trends work

are our strong execute especially this continue many achieving have our our operations for of and quarter. operation said X Looking revenue general active we improving in majority pipelines upper current mix. operating results produce turn capacity. and companies Please In our great we regionally the our to earlier are operating results as and slide in signs at this companies see The and Northeast have of demand. year Midwest to Michigan

construction year of our for nine primarily buildings is revenue. is of XX% revenue first construction the and was of Construction was the backlog total in buildings. XX% and months revenue construction projects our For new of revenue our XX% projects existing

nonresidential XX% XX% of providing is fundamentals good trends business from agreements, construction projects is is and service work in Service other providing the market. XX% service pure benefiting construction in revenue which and Our revenue of revenue. repair, with hourly our maintenance of of composed

service the projects smaller always pure in within include perform substantially we reporting service period. any Our contracted are given and majority the of has

benefit to service. have continue in to and that make made we investments continue the We from

business is profitable our growing. service is maintenance Our base and

past the few have markets Our improved quarters. steadily over

to likely believe Given the our increases quarters. supportive several remain and the we our are next for that of active majority markets backlog

history capital to to is us of return long flow cash our continue strong Our balance shareholders. sheet and gives and to our invest confidence

are to for Thank our year We and for about for I dedication. will Thank going again the XXXX optimistic our remainder hard turn Sheila of to now back prospects into nearly your you. XXXX. work once you and employees it this over questions.

Operator

KeyBanc Thank you. Please the [Operator Afzal proceed. Capital from comes Instructions]. And line Markets. the of Tahira first of question

Tahira Afzal

on congrats fantastic quarter. a Hi folks,

of changing us You of based you know that profile burn how want backlog in question, don't changing we in you keep on overbuild aligned in you so folks, said first enthusiasm, the guide is guys your mind? terms revenue mix I your terms you to know should what's would in

William George

you revenue If you I think look it see at by our can sector. slide X, is,

trend had -- the more started things the never we has had of we acquisitions. we've a before that done doing our been industrial us, One we've that that that I industrial acquisitions had than have big, mix would it for

that of more our is today backlog work. of type So

no know XX%. to is but healthcare And back really from up that's on hospitals encouraging. going on apart from a to So going uptick slight you, there's almost going few that hospitals in institutional

been… that probably don't the a I -- there sectors little because up is there's So think have healthcare I think other would picking just

Brian E. Lane

strong at to just up. really I want the particularly has year had on picked We've level. university a Tahira, add education

seen and work work lot of a there We continued have there.

Tahira Afzal

yourselves? in this uptick. opportunity pushing be work all of know when environment there, the the for uncertainty Brian year talked you healthcare that we big sort Okay, at side, a any does some there around beginning and regulatory remain out on some of would the were change to the is I pretty hoping outlook. It

Brian E. Lane

hear. to interesting It's

joining We particularly BCH we our little Northern are with that Florida They we hospitals, a a bit had doing. in Florida. are few Florida seeing have hospital, us more

bit to think you seeing add hospitals for than We anything end-of-life Bill sure. I little last but see are care more few strong as a we a years we more that. XX want to still built facilities, on, go we'll seen different have being

William George

right. exactly is That

Tahira Afzal

have you you side you've the a of the just last can years margin your on terms Brian this people how lot is about, over how into Okay, and train fast and force, of can of really and know talked fast that invested quality can that I few point labor how quality? bottleneck grow? of sort fast a you in you Is new at in grow, key terms

Brian E. Lane

skilled Tahira place getting Yeah, but the it benefit work is looking good I of labor question, that we at really do. package. got in level to good we've a proud training the join mean, of force a have, to challenge work, that a I'm we the We're trades,

So and train we are to hire continuing people.

is, see how results field. the the we it's well gross The it in margin, way think you of performing really reflection of a are the I that.

able are will So, we so but it training, grow. continue aggressively to and we that am is I hiring bottleneck, be optimistic to a

Tahira Afzal

a and again. Thanks lot folks congrats

Brian E. Lane

you. Alright, thank

Operator

Adam Davis. Thank of Please comes question proceed. you and of the Thalhimer from line the next Thompson

Adam Thalhimer

Hey, quarter. good great guys, morning

Brian E. Lane

Thanks.

Adam Thalhimer

that I get up question last translate revenue the been -- wanted has three the for in there because two line backlog actually how top on revenue that and does quarters. Tahira's we into XX% mean on year, does double-digit I Well strong to growth, plus last continue the double-digits next XXXX? quarters in line What mean

William George

organic and growth that. was So today finally growth. think and backlog revenues, little is our been about, the is expecting represents no quarter. a XX% it finally we to revenue. still mind Keep finally frankly organic that in only this to predicting mid-single-digits of over We've our quarter see construction it, the saw good unfortunately. answer it We X% It this

little is necessarily order to increase drive a then whatever building of slower. a try things signature, a will would wants gets will us scope people they put we and There company. into the people and to in a when demand are committed what to as busy, get one. get who going that be better, not realize earlier on next have than happens And we a backlog So increase something driving XX% it price, to who everybody have is are it also only summer

those is signatures So know you get you sooner. the suddenly, GC

is So earlier, The really work so a when match the reasons it big are don't that, people gets jobs revenues length longer. are just means can't the average one happy. on though committing same that, we we're said what get the backlog pop is Having even into changes, double-digit, of getting a but earlier pretty percentage count of better, often and a quite back. the that have you're we can't we little little things the do

Brian E. Lane

Yeah, we're in service. I getting on just add and the Adam, element, want to growth good steady service

maintenance is over XXX now. million Our space

So is to it's we've paying years off, there to number -- that of has made investment our off. the pay over going continue

William George

patient for bought that were things so so with so as the a to known of our great really we investments, for recession. with of of those one shareholders made is us that. lot benefit have many companies of them that these from know still the long, us deep shareholders we're You happy our around we as so in many are just And we've been long

Adam Thalhimer

good up year guys get you a there for you with possibly down, about how lot think to I picking margins particularly a moving color construction as because percentage coming summer as of next to pieces and are next of that's also revenue. amortization Okay, new ask but about want then gross

William George

was out there we a stoop impossible. that We couple interesting It's XX% a really years feel amortization a pointed you down, ago coming about is gross thought of good margins, was point.

the or about overall pretty find to Now have good although gross why larger a year. -- be reason works think we is so to we think from gross have starting and say good gross SG&A some execution us for lower be margin our it's I margins I would would often will margin. but lower hard The next hard The it's better. looks have we our pessimistic do somewhat projects maybe they lower here

Brian E. Lane

been are. Adam really is that bad it we're we've the out work on we've know But attributed the performing the You absence to are way of of this on I knocking lately, am had we in that sort fortunate, news folks managing field wood.

to think me say I be is So, right. We'd Bill's XX impressive contracting than organization. pressed will be to our we but XX very hard the lower for

Adam Thalhimer

size bidding color seeing if you're give you last us would from me, environment, by of the thing? thing geography of just by type and Absolutely curious what can project more on in that the help,

Brian E. Lane

Yes, okay.

country. country go robust So across seeing if a we across still continues the Markets us the for in general we market well. a do hasn’t good, a extremely couple active. of has opportunities strong in opportunity lot out The Buffalo Buffalo are are Northeast to years, and for The been are bidding and seen it good. was York In a a very ago, like is I has probably place long New Southeast time. weeks XX

of is The particular. companies Midwest, There in have very lot of call to your good what Southeast back and projects. seeing other projects are the question particularly I and service Mid Atlantic just a opportunities of the Florida particular there. number We seeing Midwest in Tampa little good come in construction, really we Atlantic upper we lies well would strong, the balance we are a in of the middle opportunities work back a a bit in as mid larger in the larger think

your bag there who's the probably cranes West know mixed to if go producing is extraordinary results. place is where opportunities, like you of going you're get a just Denver Tons everywhere. You at there,

still back come bidding Phoenix very diversified, been Seattle's seeing healthcare. some we're pretty good. So busy,

have we there. -- seen and opportunity California I but office Southern is rebounding still are

us us we're like but activity beat good to added domestic on we country work. I time for the throughout seeing some larger it seeing and are So, is

I the think and particularly large Atlantic Southeast in work Mid we're is seeing

Adam Thalhimer

so thanks Okay, much.

Operator

from comes Newby Thank go you and ahead. of D.A. of the Davidson. question Bill line Please next the

Bill Newby

and on guys morning Good solid quarter. again congrats a

Brian E. Lane

you. Thank

Bill Newby

up, see as that kind that the up to how at a to line about growth hear XXXX, picks So we SG&A well? that growth your and continue pick growth little kind should bit as that you little to more line are of inflect organic this nice a of SG&A where on guys, it's can for a bit should opened guys place think fund XXXX, into kind you the the pull or should quarter you good segment that

Brian E. Lane

the our of leverage. some some run who So pressure the go manager SG&A jobs. do end least you the who of at we margins is start if of the right will the run and to some our day project one always when jobs trailer as SG&A. when up positions an have direct just and gross they that not we the things up driven and the much results because don't very because a to The we ought performance that go on but subsidiaries some there to in ought plans get bigger get for At Having cost. lives leverage, downward our said is have there that on people indirect remuneration reasons job is

So, we growth it. get got some to get from a the get leverage. I little ought we If would well leverage say to we

Bill Newby

of a you I then seen and mean similarly, services the -- last construction we over recovery or percentage kind we've still about pick out? the expect as in that steadily that in talked this with I this new maybe couple Okay, is years are flatten that that markets, should construction seeing you new of can even coming up guess revenues, as

Brian E. Lane

service even continually. with or we we percentage lot are Pretty business slightly opportunities the business will seeing construction At increased of think so grow business. the a see the projects. least service absolutely, Bill maintain of are call in I robust, what a service totally committed and you to I

Bill Newby

Brian I revenue about And -- just think if I then to you've to $XXX I year as more around could, acquisitions, good is past some mean goal. the trying hear. general in one buy I the in that Okay, a million talked am

First, sheet continue for perspective guys look as changes does you to how about that tick balance up more up or as a it bigger guess think going bit you you guys at kind maybe Bill, are leverage a grow? little And of I you to from companies?

William George

from in mind we that about Well, of of our I was a don't you we, answer do money know, really ourselves. both made of that you acquisitions XX% million ahead acquisitions. really I'll that where number commitment those or really about I of think two came do since If not thirds our or on could adopted spend we we XXXX believe and get XXX

So we have the of in amount now size money of acquisitions. we now, than a used people probably guys, have been more we've overall way for place to do. more companies great does a money of think we're our of our I revenues Frankly bigger in so space industrial little little doing of that more The some kind made has be. we're the to -- that our proving attractive more to company older, itself the which

yes, might XX shouldn’t that we any an In will say you don't There quota. we over is do not than be given historically would look conviction, But year if a I average which -- we because that. averages. do -- don't So more back XX% year it don't frankly hit have we probably probably we an acquisition have act.

paid were the over debt little lot $XX to pay a debt is flow invest. number, gives down our of summer. you of today the debt bit We you have confidence right. trailing down to sheet end expect is debt cash the summer today I twelve as million. do month a this goes the we of year, big balance paying far That year, at know a down As although over that the we've

of business something for the So in to market about of towards mix half part a conceivably the EBITDA that about is whereas state, was turn I feel if we stretch our you probably think in don't probably another to us probably we good very steady invest. continuing going more had wise one turn. middle you of say conviction really used man, could -- at service ever so we The we a

resources future we So believe I the plenty foreseeable we've do for think deals in. got of to

Bill Newby

thanks jump back Alright, will color. for the queue. I in

Brian E. Lane

Alright, thanks.

Operator

And & of Joe your from proceed. of Sidoti Please next Company. question Mondillo line comes

Joseph Mondillo

I business Hi morning. guys, on wanted good the as well. touch services to

keep quarter it need [Technical well? considering from looks do -- good, does the business was then hot growth the going new doing you you construction in effective what comment Difficulty] to services your of business and so business which backlog quarters mid the to the So what really the backlog, considerable drive to construction your doing? of in to that sort given the it seemed you is, how the because pace that services quite expect is to pretty addition next good continue up up like to to single-digits is that drive temperatures what keep are like because And did your fairly you pace are couple just over

Brian E. Lane

So, us. wonder customers you But first obviously weather temperatures we maintenance what is. to means are base those whether going service our the matter grown every extreme we've help no considerably and foremost year which the

we mentioned maintenance going had still results regions for just need were still for largest and we in We really to quarter. work. us that have week the paid to down Even are we we produced probably service which the ever the terrific good hurt the and really have hurricanes with folks. we the get out base customers solid So,

I might techs. quarter-by-quarter, sales who believe Now maintain hire service as Joe continue reason quarter-by-quarter we optimism general percentage are forward for to fluctuations be we go hire mean that we will people, the knows. month-by-month, my continuing there I but But in to

state steady of we this have to are element still at resources investment business SG&A a our grow where base. still So we nice committing

fluctuations might see itself. I maintain aggregate think percentage in you'll quarter but see that you the So by some

Joseph Mondillo

just least the you mix driven quarter the by it's quarters. construction. given at so I forward was sort the is think at certainly two stronger of backlog, in of growth to last or organic next gross saw cautioning is So in of be you going near-term, very But margins, looking X% how to largely were couple new this the the right of and coming, word at least going next over the book even that relative construction

in or the So to though even near-term services of think two -- mix kind margin just on keep continues up. weighing could the you see higher over margins next the services near-term to the in to you a gross year continues

William George

Yes, gross are you I and that's margin into sort going have of -- same time, and that gross more the very from of is big average There's proportionately whatever one to at same right is because business. know margins, and good work. time it be at going factors down different would which have there we're the just good doing to been -- that a have pricing you bake we the service stream

still we have are our execution if pulls margin, in very at slightly of saying things a Brian can problem It's be be not lot very affecting projects. given be our now long-term setting work line below on is big so our a right a execution anything that the going XX three good us but any all problem quarter go Circumstances good large market. it and back the growth the our it's lumpy XX happen they day for if that mean -- when that they're of money hard we can just aside be So some each us. in right. making and of with fail, not justify right. end current for down won't is said good, projecting problem so mean you Joe, Everything's news service the XX.X, small the only much that to getting to margins because listen the we're absent medium to I It'll still said But won't right, doesn't sized up. on doesn't we

So, there. it is I sort tails of of heads win situation I win, kind

realize there mix bad a up So for when to worry do growth, our see for that people we growth good as we they otherwise domestic about you be we'd don't money it like decrease more organic happen affects flow. our that can why comes A to go down -- reasons reasons could happen. and margins end lot our sure that but could when mainly make margins and we don't understand so there they be margins back as to in slight your long your earn cash making that's

Joseph Mondillo

Understood.

I wanted of terms of favorable talk like to trajectory Difficulty] terms have you over call, sort of of could maybe cost escalated your stressed you you industry has pricing, conference actually seems net about capacity ask all it mentioned past at the that, in You been [Technical the pricing power and sort improving, it overall abilities? steadily in on certainly of of

William George

say just getting three two I words on up you're Yeah, to want us. only Joe we're about every out breaking of

pricing think know. so a issue, Brian's I connection to you So going to just respond there's but

Brian E. Lane

they possibly But to are So, as get much not as improved the the can. element, might pricing Joe going on you got within work. competitive environment, need context pricing your has steadily. obviously, our folks pricing some the keep who We of tend to pricing mention to rent, though

out not want that is going a don't price to job You go. to

we are seeing think So, state I steady improvement.

think it cannot I going see don't state to steady mention it's we significant. to be improvement. continue But We because just

Joseph Mondillo

fall about the two I've have on this, per other issues hear. one, basis phone to sorry that questions; and with hope I off? been is does backlog the Okay, I having BCH hitting you that when a just amortization what quarter can was related

William George

are backlog don't So sorry. call give you acquisitions their we that BCH you -- I can numbers Joe, individual we for us individual but of out amortization want don't do, is, to I'm Do we think our the categories different losing you don't we back.

Joseph Mondillo

[Technical Difficulty].

William George

that bit. Sorry, last I didn't I'm Joe, sorry -- can't hear I

Joseph Mondillo

to relative acquisitions. Backlog information

William George

customer trade a so and mean and XX of backlog months months amortization, XX tail. generally paces them for a there's XX a are of three to usually big XX company I amortization two Backlog Yeah, receding backlog life BCH. long it's there and to and has there like list, there's if acquisitions long name, is really have projects that

Systems. If don't You're after have out we're this in categories worth backlog from and biggest been there going this I a Comfort had deal. or but the amortization quick been that the breakout quarter backlog so for backlog the case have a amortization not see all three penny really was the to because would come two piece

want to call If you us...

Joseph Mondillo

apologize. I

William George

okay, is thanks. That

Operator

Thank you and Securities. the go next Please Guggenheim question comes ahead. Sophie the line Karp of of

William George

Good morning Sophie.

Sophie Karp

which morning and now attractive I down are my you at to seeing opportunities acquisitions, guess the seeing that [ph] on revelations bit more maybe question. Yeah, on and you wanted quarter Hi, right the you're little a guys. Congrats more in in comment you thank drill taking markets can good this for stage? I sub the on the segments

Brian E. Lane

So for sophisticated are little a choice city like than contractors. is to like sense a really that can or in clients, mechanical going buy everything what our going and go Phoenix Charleston that are we place competitively service have a we're in us. healthcare. that and look is have makes clients to we industrial part going We always we for of People the go sense or us. a just companies that after do their Diego Charleston, have they're first that do in mechanical full hopefully a make love -- dominant apartments different What pharmaceuticals right. market for where the that city look San of times going and cities like buy who to we that in lot is -- to too for for build smaller mechanical is market to a more to big to are

So for of have fit going niche we that's us. with to that look more a companies

Sophie Karp

uptick to like opportunities the -- but variations for And there attractive see, you now are the well, what seems acquisitions? you maybe that I are and going are cycles the right it doing there about

Brian E. Lane

what? In

Sophie Karp

seems cycle is -- are doing now? cycle great are variations where there we attractive it right the business in is Given like the in

Brian E. Lane

at The acquisitions that these top the us them, for of of than XX's slowed now boomers taken children are in so are a their and Historically baby down a is many realistically contractor. by path being have who different markets. of many their difference owned businesses

there So I think is that market an I would opportunities. attractive that of say

Sophie Karp

you may I looking space, still you think that the look that into electric past getting mentioned in something you that you is at? are into And

William George

be some as think have deliberate really first we and we or we businesses we electrical to business electrical three geographies good but four about we very electrical going are Yeah space. have that that have we attractive an -- where right, have view off we

people I them. to think to you we we before know buy get from know tend

who or neither we us we've we going So work are if going We're broker going happy. and here is are offers to for thing start go fit them be get learned really for don't be to acquisitions Well going if space, in we're the are our businesses. to somebody, develop either we making of to and happy us. hire one are well if it's a until both for we they electrical conviction not And somebody to are going happy. both to and to for going know convinced going

Sophie Karp

on if maybe -- I so one Alright, the may more share buybacks.

you do stock shares, back share Now done guess is down forward move that? would how slow continue with just acquisitions buying an I that the to think has then buybacks you well, guys or more it about opportunity

Brian E. Lane

current enough stand ready And to levels at say sure plus would just just we are more don't offset then we is to there. miss. dips, on we buy little a make to probably that dilution conversation buying the I

We really astute Directors who actually our the their have people of buying on shares. some who own company, believe putting Board money are into really in

have like balance a sheet having our So a million in we'll money the bunch with not they're little. right that it's good we do opportunity But do. year, and now evolution with an the conviction probably so offsetting us times for thing we're a say plus when not a a have bought that's with when would cash to at on -- I shares acquisitions just what past we of we

Sophie Karp

jump you. back queue. Got in the I'll thank it,

Brian E. Lane

All righty, thank you.

Operator

Please nine from of Joe Mondillo proceed. & of Sidoti Company. comes question Next

Joseph Mondillo

fourth Hey just big that generation towards quarter guys, I drive the really up we terms free of at strong working had cash? of capital, one what that just in your cash question going follow generation cash helped a pretty saw that looking was a for the wondering user you're quarter, of in flow so regarding

William George

flow So, but quarter little free we of good will a there's have chance. very cash fourth

fourth back you third collect last the you can't just an we had years probably unbelievable unbelievable money just the five quarter of If same five over had and look two our quarter. twice. years We last the

you but obviously collect same can't we'll So twice. always year-end, do we at dollar collect cash the

cash historically the money. to strong we So, it free a for have Because would hard be the what have in very, quarter. flow very already fourth us

Joseph Mondillo

Okay, thanks.

William George

way Alright, well by of doing. willingness are perhaps bodes the thanks ability you guys. and script the -- Brian said And pay bodes people jobs to in it his

money good a also your but money comfort that news business get you is the on is quarter well. it So in collecting When get you lot the levels. third you're of doing two

So thanks.

Operator

over you closing comments. Thank now the I like for Lane Brian turn would and to call to

Brian E. Lane

Okay, for the you call today. thank joining

strong. shortly. with to We will the weekend. forward we on year seeing very Hope the pleased We look have will Thank you. road we optimistic are you great and a quarter finish the that everyone are

Operator

concludes Thank great a and presentation you for disconnect the joining now conference. today's you This may day. and have

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