PWR - Earnings call transcript Q1 2019

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings ladies and gentlemen, and welcome to Quanta Services' First Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] It is now my pleasure to introduce your host, Mr. Kip Rupp.

Kip Rupp

welcome Conference the Call. and Quarter Services you Earnings XXXX thank everyone Quanta to First Great, in Media This this announcing quantaservices.com outlook results, found and our we along first Investors morning issued of we quarter which a with a commentary can our website that of morning. our section press summary release the at and XXXX be discuss will that reported of therefore replay information that as on time advised today, you Xnd, remember speaks accurate as this may Please only of information and May XXXX are be no any sensitive call this longer call. any of This Harbor statements from forward-looking Securities intended Safe by established under the Private the of call will liability Act Litigation to include Reform qualify XXXX. intentions, or to future beliefs expectations, These assumptions current or performance that relate solely include events all historical not or do facts. about reflecting or statements Quanta's

and involve may or and Quanta's certain control risks, statements those Forward-looking or that from uncertainties predict to are beyond materially expressed results difficult actual assumptions differ implied.

concerning information risks, and with included please SEC's to release some these additional other XXXX XX-K and Report filed Securities For which Commission its on Exchange available Quanta's assumptions, on along or language documents today's press Annual Form the in the the uncertainties refer are website. company's cautionary and with of the

of included our diluted free measures adjusted any update non-GAAP by comparable should certain their that statements in present made and call, note measures cash on these undue EPS, does written in including this regarding forward-looking are to oral most to call. reliance any matter not of statements EBITDA obligation such will also financial place and not directly backlog, disclaims You release. forecasted statements and the GAAP and measures undertake earnings Please financial we historical Quanta flow. Reconciliations or today's subject any third-party

Media be information, email section please through the Quanta releases sign notified and Lastly, like publishes Investors alerts if when news for up you to of would quantaservices.com. and other

on media We Quanta and listed to social Mr. I our and the the to Duke? on our interested to call over like Quanta others investors that, encourage in Austin, company President channels CEO. Quanta's would follow turn now With also Services IR and Duke website.

Earl Austin

Good and first Services Kip. quarter the morning earnings to call. welcome Thanks, everyone Quanta conference XXXX

I who to On the will of call, before operational Financial quarter strategic will Chief first and provide detailed Officer, a it Jensen, commentary provide our turning results. Quanta's Derrick over review

questions. share adjusted with meaningful Backlog for $X.X This supports believe highlighting Following quarter $XX.X quarter year your we of reported a per with results, the project is without record end growth. expectations It of morning record of Derrick's customers. primarily and for diluted revenues continues worth earnings $X.XX large well to $X.XX comments, multi-year backlog was grow and existing this and the growth billion, GAAP which and and we and first bodes the awards of respectively. result our welcome spending incremental we for billion programmatic at opportunities that is of new

Electric our we of our quarter our safely confidence expectations first As results, for Services financial visibility our Power execute, XXXX. to ability a full-year result for solid increasing and increased in are

portfolio. and growth pleased enhance operations stability the We our continue our of utility-focused to with the are business of

in and solutions position various grow of our time. over are through to profitably unique capabilities weather Quanta's and geographic customer, competitively companies, provider, project, portfolio execution, led geographic, us also of service space lines. in diversity both set We continue opportunities strategies risks diversify presence These to aspects our scope other risks. our our mitigate evaluate and many us a diversity, including and services and in construction business, apart scale infrastructure investments. cycles is and Quanta strategically designed We expand to geographic and are believe specialty permitting, whose to

Our western hardening with quarter, accelerated United in of increased power for demand States broad the based our programs. the operations services and the grid electric region fire modernization in strength due business reflect to ongoing

past the grid. significant Over state hurricanes California life. have several in Gulf spurred for and have about our Coast some events and initiatives property the resiliency devastating to time. East the talked hardening are the the of and damage we years to regulators These have hitting wildfires caused and lawmakers ongoing and customers, the electric enhance them Storm

partnership Fort three impeccable XXX-kV resiliency West exceed system modernization the Quanta allocated States ahead the project an stages. this of included economy engineering, and completed utility are with and CAD initiatives ever record. wildfires total budget the their we improved the in the over believe and with billion, X.X initiatives Quanta. opportunities aggregate, grid and to the on by completed Western regions McMurray provide construction was and procurement Project the of However, CapEx Canada's modern project. a bond project and the value among fire history, projects benefits months during line schedule, The These longer Transmission necessary hardening. was in in safety are the largest Canadian the in Multi-year transmission infrastructure history ATCO the Canada XX very and resilient we term AC that and in project for longest $XX top in quarter, and largest built near and in ranked other for against partner grid and billion services transmission was payer Also XXX-km meaningful financed first early in our through XXX-kV rate for energized XXXX. line portion hardening budgets United for The California the significant was public-private

dedication, only successful provide to have customers many customers will one work our infrastructure that but is on collaborative projects. example an and world-class partners with collaborates Quanta this between execution is This continue of ongoing possible our this hard not develop initiatives safe world-class solutions, our to execution of by project the in partners and would how employees. project without Quanta's and example been success Our and

change brings energy the last the is Additionally, considered a political province that the to favorable business communities. election in Albert and in month

While development pipeline other change in are infrastructure approach confidence that business a this that how impact and could electric transmission regarding parts our will this we change larger encourage are several we transmission electric of bring timing pipeline taking and Canada, opportunities. Alberta prudent could to and optimistic policies greater projects for expectations positive project and

on have quarter operations well. communications mid-single Revenues the profitable revenue also the believe quarter significantly generate track in income incrementally digit same this year we the with to Our started last margins We operating approximately for over $XXX year. were year. million and are grew

operating in the we providers billion margins to medium $X believe, backhaul the to achieve with as push deployed additional service in Fiber term continue also continues, We can fiber XX% for closer continue is densification to annual fiber revenue income network electric systems in locations, expand small as Quanta. rural broadband and to utilities provide outside XG for opportunities we believe areas, seek initiatives markets Further, cell which wireless XG distribution increasingly continue. urban utilize carriers for expansion additional networks should customer. will

Turning Industrial segment. in are year to and another our performed quarter industrial on record for Services and pipeline in track the well XXXX.

safety drilling, infrastructure, system natural over as grow demand business midstream to downstream drill to pipeline and Integrity distribution, services, which pipeline segment customers in and Our multi-decade for industrial utility-based and gas supporting the and gas our services coming include mainline horizontal grew execute MSAs, logistics continue integrity, engineering. are for utility years, directional management, and this work The opportunity initiatives. those services distribution modernization operations expanding,

pipeline quarter large pursue executed continue Our a we America. also and to meaningful well of construction throughout projects operations during North the number actively pipeline

the access, are market into we believe As Utica production natural service region to Appalachian gas increased and gas provide operations and experience shales main in lines activity. placed from will will grow the midstream Marcellus natural our

Additionally, midstream infrastructure we were the actively Permian Bakken, DJ building basins. in and

LNG mainline seeing available We positioned gas export to projects of Texas Canada in development production a natural of States to to and are Texas also various and there from and growing Other West oil are number opportunities and development increasing West gas United and in driven pipeline the are in from and market. multiple benefit capacity these petroleum and oil pipeline is permitting stages markets. by move outstripping well

project mainline in high North and in as strained levels resources the a the increasingly industry capabilities regions of investments. year. result opportunities are operating of pipeline is through Demand in Texas and and our as progress actively historic We strong result other and are awards for have pursuing that services could of midstream capital America we customers

we XX% plans. self-perform grow customers' approximately customers, have control which provide specialized to year, as we of which largest the workforce to the the growing needs provide execution spending to our in are expect revenues solutions us continues allows skilled multi-year and to certainty capital of mitigate risk. The We our industry, meet we this quality our cost and

to recruiting to needs have ensure customers our investments strategic workforce in For and increasingly years many qualified has stuff our and safety, to meet and become Quanta reliant the business. necessary training of the grow made we

well Northwest training demonstrate commitment ongoing due Our partnership the a the to we reflect increased groups in and needs activity and the longer other for full investment Quanta continue facility, our regional and to to of and sets financial against strategic In execute, increased affiliations all services Lineman our us apart to our our quarter term year, performing trade what our of operationally world-class expectations. with qualified educational electric ability customers power training developing and safety first have our and to our record these our meet execute College, start to marketplace. solid we results our safely in summary, year through results confidence labor in Quanta's is our well employees, plan. visibility

a cycle results with are strengthening in for XXXX. Our markets backlog visibility we end up record continue believe the multi-year in to we're opportunity and and continued

base revenues and business in our grow for account XXXX. of approximately our expect We to XX% continue

billion with services coming pipeline profitability. we $X be There new more for programs three expect are continue awarded medium and near, to multi-year over robust our improved alliance opportunities communications the of more quarters. of billion over infrastructure project transmission see the electric and dollars than opportunities larger from also We opportunities operations term larger that growth than project could

on long will will term CFO safe customers. ourselves the believe our execution now turn the first opportunities continue solutions Quanta's an our enhance pursue for and and leadership quarter the long base generate model business mind his leadership, to operating over value our for to us the results. for that diversity, position stakeholders. Derrick and review I the We provide continue operating allow are innovative to Quanta's that to entrepreneurial and will to term industry to to business for we I unique focused built Derrick? all call in distinguish foundation With best-in-class expect Jenson, set our and form through

Derrick Jensen

announced morning XXXX. first the Thanks, over everyone. and increase XX% billion, quarter record good quarter $X.X Today we of first Duke, of revenues

earnings share. diluted For diluted common stock diluted share, XXXX quarter $X.XX, project. Adjusted per income to measure to $XXX.X the $XX.X first GAAP non-GAAP related attributable share, per $X.XX or share recognition previously quarter deferred of electric in the million was XXXX, included or is attributable to and the diluted net earnings per first adjusted earnings of transmission was Fort for West $X.XX the McMurray million per and of

base diluted quarter customers. reflects The revenues and lower services GAAP quarter our quarter to of per segment diluted robust power revenues to represents in as benefit, and or of of the our first of distribution business results, this the electric XXX%. increased projects, quarter the in compared XXXX adjusted XX% approximately increased of due with segment. reduced or strength to And share Excluding This business million share X% increased restoration compared to first momentum in levels first revenues offset Discussing emergency our earnings first when earnings $XXX from larger record the compared spending continued quarter billion first $X.XX XXXX. $X.XX to communication our XXXX for per transmission, $X.XX of as increase by the base well the XXXX.

the in was the mentioned, McMurray XXXX, project Duke of energized. As Fort first quarter

had However, the the to substantially of activities project first XXXX. reduced compared quarter

X.X% the during $XX in emergency the while the revenues compared the quarter as in in addition, relative X% restoration first Operating of exceeded segment our power million XXXX, quarter approximately decreased services the to of quarter. generating electric quarter of still to first In was XXXX. margin first of expectations, XXXX, we

XX%. on Excluding are across which the by fire Higher to normal attributable elevated approximately were solid to our levels on included execution West of segment, power communications segment helped the margins spending within aided margin offset electric continued electric continuing hardening improvement for and which operations consecutive improvement the were operations, programs Coast, within power and the revenue incremental the quarter continued infrastructure effects performance both led seasonal segment. fourth services by growth during Communications we expect mid-single in these US approach digits to our operations. deliver XXXX. operations for improved margin margins Margins

America customer due cancellation the had our our into to ongoing continued payment. unwilling acquisition. demand completed land models. We to and larger the of severe run Latin portions had was step items of efforts, our despite contract delays collaboratively We were customer these to delivery permitting next likely our Our as the payment working accept resolution. believe the has quarter substantive reached a Subsequent been and that and arbitration of outside had and with to towards to position been weather and receiving recently have in control. presentation certain ongoing that customer We communications until however, the positions is equitable we obtain project delayed milestones extensions

first due growth. Overall, was in record $XX segment complete with and negatively industrial to both first of million the deliver as adjusted compared was this to non-allocated to combined billion. to second XXXX. increased were of growth as for an increase XX% estimated of EBITDA, amortization as of as million, first services these quarter primarily XXXX $X performance This cost XXXX. first small which and measure of revenues $X.X the to potential all XXXX X.X% distribution, larger to contribution quarter project X.X% for or a compared Our of improved intangible year expense the Operating segment of processing due opportunity from when our of increased half based when timing in the coupled compared business industrial projects activities was and the from from larger revenues in is of industrial quarter weighted our typically increased of and results impacted the as that increased million quarter revenues towards margin the project well operations to execution primarily regions, XX. the reserves quarter projects, increased segment was compensation March approximately transmission XX.X% offsetting of costs increased to increase quarter relating increased XXXX, the larger This margin the as attributable XXXX, sensitive increased Partially XQ'XX. weather which first in damages XXXX. pipeline approximately from in and gas of higher first to compared expense support XX% Corporate increased for $X.XX liquidated first when facility business quarter to non-GAAP a to provide to pipeline $XXX million and XQ'XX experienced

payment In last cash for during filing, of all negative quarter's flow stayed cash cash filed activities. to support For had as bankruptcy quarter the activities Receivables first free first discussed progressed. $XXX million bankruptcy by as used PG&E were operating Increased of on the of call, Also, programs $XX working Pre-Petition expenditures we contributed requirements bankruptcy from we protection proceedings quarter. with net the fire million. capital was million, $XX flow negative capital to and XXXX, operating the flow was hardening conjunction

of the PG&E, approximately Receivables to and value in relationships remained of of of underscores April, customers the In term. that outstanding of million the and strategically believe at receivables $XXX XX, pre-petition our will them. nature as payment million receivables our the result the approved which two collaborative assumption place significant March which and in near pre-petition development $XXX totaled contracts the resolved on portions approximately the court We were customer of speed our Pre-Petition abilities XXXX. bankruptcy the by this support Our

XX XXXX. period days, days XX compared was XX quarter in when increase the for the of for days an DSO same to Additionally,

elevated McMurray reclassification impacted for this a the by significant payment current DSO changes long-term it to is from to balances customers, level the few the the attributable including during billing process for schedule some project, predominantly Fort quarter. extent to Although retainers receivables of

During million had stock we approximately repurchases, the open shares we for stock XXXX, these authorization. in $XXX remaining quarter our repurchased million outstanding common repurchase first $XX on After of availability $XXX the million. market of XXX,XXX

March Additionally, agreement we share, under had announced a quarter million in we million. secured XXXX, per our ratio senior credit total liquidity, XX, dividend At debt-to-EBITDA totaling quarterly approximately X.XX of in XXXX, which cash results $X.XX $X.X as calculated during times. first the second $XXX of of our

XX, of our obligations be months. As in performance March XX% remaining estimated billion, which approximately is total aggregate XXXX, to to XX of approximately be recognized were next $X.X expected the

over the Our aggregate first XX-month March line X% with of of $XX.X the total X.X% over billion, XXXX backlog first XX, was and as of billion $X.X increase XXXX an backlog was year-end. quarter of XX. our growth the strength base reflects markets, quarter demand end activities. for continued and of our and on business The in longer-term ability capitalize total our specifically December backlog the XXXX to opportunities in

solid consolidated guidance. be business visibility quarter remainder $XX.X between into are to attributable billion to performance, strength billion base to increase million of $XX.X the revenue the to Due $XXX the Turning segment. year, of first improved our continued we that with and in our electric and our range increasing

year margins part in and the pipeline and quarter the margin our shifts, we revenues markets. and Fort other the across project end Of the reflect the expectations acceleration quarter are guidance our in industrial to lowest segment, within initial year. margin project into the for full timing electric note, to regard for power second expect continue first power seasonality confidence our quarter ability likely to from both electric due segment be McMurray of to to Our and electric with unchanged segments execute

increasing and increase million million. free a per cash $XXX between $XXX $X.XX. $X.XX billion. between we continue to With just range between to and EBITDA adjusted and for earnings flow perspective, flow expectations expectations range forecast expectations million cash $X.XX and $XXX our and between share over our From revenues, range are to increased $X.XX our to $X We've adjusted share in the we per expected full-year earnings also

million. or with the forecasted free current of forecast due could additional Similar However, expectations, in revenue to support to put quarter, expense. million on increased first our to awards flow required expense increasing year between during capital interest to our prior certain growth incremental interest excess $XX cash of and our and receipts cash timing revenue working for pressure we years, are our expectations $XX the coupled full range

base believe in posted a year markets in increased Media strength our Investors business, our our summary we've line XXXX particularly the on of XX% remain and initiatives. This open formal section are now our We to to continue detail. greater we of and larger confident reminder, We which the on on currently guidance expectation. website, our represents our expectations quarter our which momentum current first & capitalize approximately reflect and and project As performance revenue financially of presents Q&A. opportunities ability well-positioned annual the concludes full the in guidance our will operationally and for our presentation strategic execute to our Operator? end

Operator

and we now session. Ladies comes of [Operator with the line question. from conducting you. Tahira gentlemen, KeyBanc Thank your be proceed Afzal question-and-answer Instructions] Please Markets. Capital question Our will with first a

Tahira Afzal

you first quarter of already margins well Thank oil of or I love I folks, of say, strong obviously seeing I business in would obviously well -- as focused you. all. the Within for pipeline and I space, the you margin side. a a Great hoping the very as there were for? is question are regards and know quarter, guess how you've get the gas, some doing? pipeline the to to that on on my improvements first is sense integrity should we

Earl Austin

of believe up segment, throughout It's would it's that side certainly our that very we levels in stay We well, earnings, look starting we we quite and quarter I margins nicely, the there at When see focus you're on of Tahira. record to our think said XXXX. pipeline we show LDC said way the was we quarter, at that we the we at look well. have, some through Thanks, segment. utility and the doing and the came would performing business, industrial the it

very that's done So well.

yet really we Our there, season. not seeing in big pipe, have we're started the activity

year. in business we seeing comeback are When So as that'll our some Canada Canada, the at of the be well Texas. and look latter as the Bakken midstream we in of half in

and we're together. utility underlying that to starting segment with business and on overall, We're through the of some are the come business. especially So our see pull that the to the things margin side on in working starting integrity

of accomplish. proud able pretty to we're we're So what

Tahira Afzal

up know there finally on Okay, map. out has the come our billion, is what great. talked that and saw in when back kind tally forward? billion based the there other And on for up you Is Could and transmission to for $X the the revised question side, on we you? about be seeing XXXX. based conservative end last cycle, being second you together. up your ones we're $X on seen back to Duke, but estimate that some Canada we've point, now Everything we a in the a of bias do Just prospects going right piles

Kip Rupp

the about of than we conservative think and our larger any chasing that that numbers when large we're on certainly that. much I talk are projects, pretty we're side

it's fluctuates. more both think those that if that of certainly, pipeline, we at number large than there at the of billion just look there, it's sides -- business on our But numbers. that have projects to look still lot so, and out bigger I you it, much when $X that say

Tahira Afzal

congrats Thanks, your to team. Duke and

Earl Austin

you. Thank

Operator

you. Thank

from your questions. line next the Stifel. of Our with question Noel proceed Please Dilts comes built

Noelle Dilts

Thanks on good quarter. and a congratulations

basically if you to high beginning employer tight position a you your Quanta has Just is the lot that taken markets. of given think market labor that I we're in do just generally labor is choice any that become a and you more supply level, try of labor. and comment Can if there an have of that the know a you on as tight to ensure valuable? your in of getting And strong actions such from

Earl Austin

specialized I skilled Noelle. in at general, focus labor think to look Thanks, and ability on When Quanta -- that's we a perform. what our we

well and a -- about done I well training talked investment a million $XXX with investment tight labor us, and So necessary think up labor goes market a of training. bodes we've we've for

I So in clients in on think some things service us our for also this business we've to are I be base future. the think those all utility we that starting done And have do to move sure will work and future. we type past are to make forward growth the the labor that for when pay able dividends key foreseeable

So the we'll to how pull early sure ourselves are and training field, concentrate into that we can and continue to get where getting on through labor them make we be more productive.

So for that our going forward. is business key a

Noelle Dilts

Okay, bit ago of thanks. on transmission discussion kind allowed there'll and And industry? level impact be second, on of came there's will out that kind just shake if few any thoughts been a Any distribution the about of lines. FERC of that how high at a little up talking on and months rates return

Earl Austin

first any We're even right States, FERC refusal to legislation -- XXXX of the have line. things some allowing seeing incumbent on on in the of basically return on there in FERC the different some Texas are

and going So to invest consistent FERC, things they for to you're going or way are who foreseeable future, other lines. like in that returns, get want -- I don't they far the I the too one see to infrastructure to the want in Look, think people US build think not

a have great We Chairman. Commissioner there,

for FERC builds of enable period a we I see think will construction long long for So the a infrastructure way time. -- it --

Noelle Dilts

Great. Perfect, much. thank you very

Operator

Thank you.

Citi. Kaplowitz with Andrew your proceed Our with line question. question of next Please from the comes

Andrew Kaplowitz

Good morning, quarter. guys, nice

Earl Austin

you. Thank

Andrew Kaplowitz

your past, it fire quarter or and and digits But seems like in has the in the the like ramp strong you US in business. you looks talked focus but USS grid the very hardening modernization the it grew storm base up. double Duke, grid [ph] to in continue about

more the in multi-year color build long growth of could visibility level and those out end you you your last, can year? [ph] higher double-digit build-out how see least give led of now do a as this the into at base spend US to us So to the

Earl Austin

base think is start need concentrated it tons grid XX% you're we and you're of a our around a hardening, side the things there modernization, it, need that's but there, stable previous think of piece and we to I reports -- real. space. sustainable company. talked And go of fire out to back even were kind the all you on self our continue digits you we've year, back the driving, hardening, growing quarters mid-single pull think the then that about into about grow storm which we when see we by growth last of in There's as will modern business, grid, that it's seeing sustainable, stand automation business that, We from and as we TND can grid. see to go for going I if it's continued far utility

Andrew Kaplowitz

helpful. what been gas improving sort it that projects book, so at up I there did That's you're the you business pipeline is is midstream in projects And booked, general this then just and infrastructure go really these acceleration think backlog you look oil I and was pipeline the of quarter in as if businesses within total these integrity bigger talking about you've bigger well? in just the despite industrial any saying -- wasn't really

Earl Austin

into backlog they announce didn't at on doing on we're kind quarter. and a see Industrial certainly alliances don't programs we're But project, in that those -- any things time, larger Services, given in we're those se programs but larger the these in things have projects backlog We per programs now, come put starting able large Yes. to large that some of are nature. to we multi-year but

Andrew Kaplowitz

guys. Thanks

Earl Austin

Thank you.

Operator

you. Thank

Please Mr. question. Please line Credit with are with we'll on proceed comes Dillard your question Suisse. Dillard, question. of not Mr. is Cook Okay, with move Dillard? Bank. Our Deutsche on you Chad the from to next line proceed mute. sure with Jamie your your

Kevin Wilson

Hi, for Jamie. morning. on This Kevin good is actually

the the free in sort that, on question million cash about have the the a are cash midpoint to you you of guess conversion cadence I the it the then, remaining achieve of EBITDA, a cash from still rest of to flow looks Just Thanks. Understanding expecting you of for guidance, because free And receivables months of adjusted sense that. XX% of $XXX of flow related outstanding sort PG&E. year? like the flow. your need to X broadly up at free of

Derrick Jensen

flow that end from PG&E you perspective, in kind a timing that potentially, that to some million $XXX we previous kind still The cadence still to cash million the We seasonality, to it'll our expect Yeah. large the a the that things things as be be $XXX commentary, some of the largely coming think relates loaded. through be the perspective, our drift we still need we and our far those have is it some free on here to year there see in the the able second in But third quarter. of it to similar not From backend and I is into a term, range. fourth. processes will put pressure the quarter of largest portion by come to with far the portion side as and degree the probably uncommon to system. will near there a quarter, of of a of are in visibility of though fourth going deal through The with in tell would administrative by administrative getting second

is of dynamic in you So the quarter see some when second that type and I that recovery. think third

Kevin Wilson

thoughts and and don't there in mentioned on the pipeline, you any then which And quarter, general, M&A I updated is allocation and was, wondering Thanks. how significant helpful. acquisition during you and how was if the capital then general. that know I that's Thanks, that just the segment in have in is looking release

Earl Austin

as that as again in nature nothing distribution the are out some Yes. there allows and a M&A that a great stick we our large have The so there's was been we'll have that specialized ongoing of certainly more, our support always there's pipeline we're a us but path was we a operations to critical And North America. eminent aviation company opportunistic good businesses there, strategy to to us, was acquired, or that was that the from that's for necessary far meant it. acquisition in standpoint, smaller we've on transmission, acquisition company markets

Derrick Jensen

million to $XX size, about a run rate little revenues. than was less it Relative

Earl Austin

in the past, the continue will basically, at as as path which And as as buybacks allocation far we stock have is same as look acquisitions, -- allocation dividend. cash far we we on

at that look shareholder those make of sure all we're enhancing we'll value. So to

Andrew Kaplowitz

guys. Thanks

Operator

you. Thank

next Our Please question. the with proceed with Thalhimer Thompson comes line question Adam of your from Davis.

Adam Thalhimer

How there XXXX? did outlook what's Hey, good in morning And Nice stronghold Duke, how did quarter. -- the QX? for guys. do

Earl Austin

talked mean, expectations. and specifics Industrial Services performing about we in business they're But won't than segment into our that segment, and record of underneath well, better our I that's get industrial think we've I the stronghold. really on general

So proud and of the industrial adding really we're really of line that, that of we're pipeline kind segment. proud to service

year standpoint, this So was we as from them and next record having year just a year good. our see

Adam Thalhimer

in And I Coast guidance. potential know year? then Atlantic sum activity the what's first do But not Good. latest is you this the on thoughts expect

Earl Austin

for little Atlantic this very have expectation Coast year. We

you it's and XXXX, if think others are I saying we'll a to XXXX go to back and Dominion, type Duke their schedules. build what stick

Adam Thalhimer

Okay, thanks.

Operator

you. Thank

Our question the Riley B Rygiel & Alex proceed your next FBR Please Company. comes from with with question. line of

Alex Rygiel

questions. thank good taking you morning Thanks, for and my

Earl Austin

Alex. Thanks

Alex Rygiel

about you to a of or needs something out go questions is come that backlog through has that quick how you anything here, there that was back that of Latin couple can telecom mentioned big already project, and American happened? and A

Earl Austin

a The Peru. in was issue America No. Latin it type PX project

And delayed along point it's been to country project. here. reasons kind so some of in just, thing the along to sort we're some was of and for to We're arbitration at move necessary this well as various go

with through the working I and we're and move it So we'll think get forward. that client resolved

very left a the to project. out small finish have We piece

Derrick Jensen

for about only XXXX. it's expectation Yes, $XX million

small. relatively it's So

Alex Rygiel

the million mentioned in also a that some was business charge sort, you what industrial then And $X again? of

Earl Austin

the damage that processing was primarily getting it as facility. most that complete of that we processing delay is damages far We delays around and the about That project. and was, some same had some liquidated and is had facility previously, liquidated that as talked on

Earl Austin

on Very timing of seems helpful. number And views of your in CapEx? in shift here. shift mind, then on of how pulled other more telecom longer-term of a have any first or telecom? It or customers their spend might in that the world kind macro back change sort the a of CapEx is quarter to that a Is technology like views

Earl Austin

at when and play thinking. it's Yes, their the some see to technology that We're XG Alex, it, for into necessary mean, build. we that look I and of think starting fiber I

data overall necessary advances be. it technology So you'll it's to or fiber, movement XG, in it's whatever have start for may to see in centers but as some whether backbone, them big

would take we good lot quite fairly been don't XG we're as whole it certainly of around business, things it probably your We and electrical for system. in the out into and we're to such, fundamental see So dense standpoint as gets foreseeable that see a as spends the don't change, the capital in have continue over the closely. moves a dense and of into from the a use suburbs our I but it, I areas easy clients and the will past. be communities, elevated as bit, future it timing longer say shape permitting from will other we following -- distribution they way the is see think when

with they a So of it. for electric make distributions get to sure challenge that'll carriers working as utilities, the that distribution be they're -- the into side

Alex Rygiel

you. quarter. Thank Nice

Earl Austin

Alex. Thanks,

Operator

you. Thank

comes question your & Please the Our Andrew with Baird Company. with of next from W. Wittmann proceed question. Robert line

Andrew Wittmann

Hi, are flows. working about for chunks to questions talk probably just And DSO guess my to cash great. guess, capital of I be other I and/or going wanted I two Derrick.

to contingencies that to places was the Specifically the other you presumably coming I the I need need Mac that on move wondering checks to think soon. be be able that door. the size released the Derrick, retainage cash get balance to on box the mentioned sheet, means or and what Mac in is Fort of cash be Fort fully could and

Derrick Jensen

to from timing I be frame. a as necessarily got second to mean balances. that $XX just part isn't during effective tell early balances a the amortization third, all from more remaining final you I we it's a It's sizable as by those of of we've it's XXXX, process upwards those maybe probably and to getting up, much million. hold the would perspective moved Yes, through that expect current, balance. tiered reached received mixed go non-current kind to you it's related in to time of reasonably administrative of fourth quarter, there quarter this

Andrew Wittmann

for the I $XX you're of total XXX but there did going Helpful. as and receivable, that it not that, should plays to a size balance we as comment you about on, the process how that your sheet still collecting that think that was think And relates flows, million then what's and to out? chunk be cash PG&E the potentially income good statement that you odd said

Derrick Jensen

today remaining guidance had stands that -- will of Previously, contract that beyond balances we XXXX. that balance those for still XXXX as no be be that expected we beyond would we it have here that Sure. yet given assumption belief

position still today. We're this not here perspective, have no pause from be the In non-current, the relative will fact, line related it as and we through for administratively of level expecting courts working normal kind going and the with of a not working process in that it with of stands customer balance will collection we've to be collection. parties. through full just at with the stage, do that we'll we're moved receive a timing to that working We actually our

Andrew Wittmann

quarter to had you of that of just And guess, you I on I mean side then characterization with mentioned and XQ your I I the my helpful. That's I electric pulled you of guess strength final wanted it. some think was get, mentioned different And type a expectations ahead into the first question is in guidance. here.

in these So and acquisition. then

that at you in in did the hike, impact really change first just how year-to-year the of bit a year better on you that's, the what's just, of look it So, quarter the guidance has balance is and changed little the -- when or to overall Derrick this of guidance? much balance the

Derrick Jensen

did to perspective modeling. at it side our a from power. first a I nice of our on electric both quarter, a of power, and the relative of portion we pipeline mean, up but upped I equation from have own revenue kind electric Yes, and looking mean larger we

So to. that contribution see of work third as strengths year. quarter still potential coming that We higher the storm the a reference base some expanding is well and has to through hardening to the fourth as due made representing business, Duke of yet the degree in

expectations upside our standpoint, the So see the own we contribution as much happening our year against the latter from just portions first the of versus of of quarter. the in

Andrew Wittmann

Super. Thank you very much.

Operator

you. Thank

the from UBS. Nick comes question proceed with next Please of line your Our with question. Amicucci

Nick Amicucci

business that taking have within approaching guys, we will as dilute bit the end guys high outlook throughout of to pretty communications for Quick kind margins. for end that of and on they in some communications questions. look little those QX, Hey noted so the thanks of range, question, I want mean, -- a we the strong were color year? get year? the end on, of of electric and you just And my the trajectory the you margins kind just the throughout up how of try the the shapes the around have

Earl Austin

when mean, at business. I you look the communications

think general, strengthen, to continues it you the there. get fourth fine working, into seasonality, quarter, and be some but will think I have I quarter-over-quarter when in whoever may you

capable So we'll it. business the doing segment. our that we of believe still in and we about strengthen electric doing, segment how we prudent to divisions continue electric is be to got margins what But at there parity

like in strengthen especially. the US feel year throughout it we will So the

Nick Amicucci

just as basins right, Bakken noted All as you US and of within well. the Canada Western And in then the other shifting great. pipelines, the and DJ

So how other color active regions and in guess, I just regions of, some much forward? pipeline regions account the for is what how on work wanted of try bidding think and the get you those portfolio to those can in and moving kind non-Permian do

Earl Austin

back I big midstream to some start to our pipe mean, get once see midstream you'll we see Appalachian build-out comeback, takeaway of you Appalachian, anytime have takeaway start you'll in and have you see the business activity, capacity, underneath. come the the as you'll drilling

back Canada comes the midstream down Bakken Bakken So the a that seeing business that's seeing Canada you're and the there midstream region. DJ underlying to and Western and seeing is that into have what's activity your we come and in drilling Canada in nice in start you're also is business

pipe and So the repetitive underneath robust. pretty the it's business like activity is that We in there nature. big

So we're at working and hard regions shales. those pretty

Nick Amicucci

great, Alright, a guys. lot thanks

Earl Austin

Thank you.

Operator

you. Thank

William your Davidson. next question DA the proceed with question. Our comes from Newby of Please with line

William Newby

the quarter and guys. on congrats Thank you great

Earl Austin

you. Thank

William Newby

legs, and briefly Duke, mean, response side, given of pipeline permitting pop and a Texas but been the in on think earlier, a stay favorable I you thoughts more Noelle all a of mentioned couple these if think kind Senate any to first that's seen historically eminent of particularly from I guess I reforms regarding we've where relatively up have in Bills they you domain standpoint just have past? wondering the in on that's I it

Earl Austin

a here. if legislation energy think, of of is state. people to LNG stay the I to to build Texas lot out Gulf from exports in will Coast want move it down don't material fine standpoint a infrastructure I think infrastructure necessary if if Yeah, we build necessary, change see here will continue an see to and the that's any

part process continue anything federal have us we don't orders help see So process. and for would will to some say permitting that to make out to regulatory I cause that and think give the a impact. any sure administration build the happening. standpoint, executive that help from did Texas are certainty to I intended

it start be to FERC. get get federally, somewhat see it you not pipe So do get sued such, and but say FERC full you once with won't think it certainty I that I it will do at but some will believe and that, what and build if you to prevail through through you'll takes to some least you

all builds help decisions liquids future or orders And we executive happened will infrastructure infrastructure move it the quarter. it certainly in the gas had down do the the be. the like we and to so some in and may to in coast think that and And of order whatever

William Newby

communication guess that and side. years? Appreciate where two does in capabilities business? guys next do mean where wire one sounds you mix you helpful. going I to if the mix over talk it and wondering then kind -- are both like stand is I back on now, what about be that That's and it willing to of see line guess it. wireless developing you'd the in And I I'm you're

Earl Austin

you when what for business, we're at fiber rings. mean, I the building most ring part fiber communications the backhaul now in we're or look doing

distribution, the of businesses get to We I are the voltages different really it us takes the getting say distribution system. the would in us start for above person distribution electric we on work, but see it when business, primary put doing of to to XG wireless side class where some a starts the it

put own So, as that that and as to -- on start the electric of that se start with fiber you for alignment the air that bode carrier will Quanta. utilities work in per even the need XG kind the to -- happens, or they utilities will well

offices And XXXX, there, we again how I these is some what play. -- and see come challenges, at of that's we through out into see the our quarter-over-quarter to profitable we're are like increase. I that, more methodically. scale wireless and performing we've But our not cadence XXXX we're think work it's beyond. saw more where the We continue working capabilities get to as like doing on it's we think XXXX opportunities business we in stand, start permitting think and I our when really you like to look it I getting where we I

William Newby

you. Thank it. Appreciate

Operator

like I Thank to you, turn are for questions, at floor and comments. closing back would ladies further gentlemen, time management the there no this to

Earl Austin

in the exceptional. women did in performance for men and the to say quarter. They thank the the like field I'd

call. questions So Thank this we your participating you, We the for them, and call. and all want Quanta. first to thank your thank appreciate ongoing in our quarter you conference concludes interest in

Operator

your disconnect this for and ladies you, your time. you Thank participation. gentlemen, lines Thank you at may

Quanta Services (PWR) 2 May 192019 Q1 Earnings call transcript