PRIM - Earnings call transcript Q3 2020 | Primoris Services Corporation

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Operator

Greetings, and welcome to Primoris Services Corporation Reports 2020 Third Quarter Results. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Kate Tholking, Vice President of Investor Relations. Thank you.

You may begin.

Kate Tholking

Doug. you, Thank and everyone, for us joining Good thank today. morning, you

and today Our Ken McCormick, President will Primoris' for Dodgen, Financial President Vice and Tom Officer; be speakers Officer. Executive and Executive Chief Chief

to our that discuss on on addition posted plan call. points website yesterday we've highlight release, In also press slides this we key to afternoon's

and site, expressions statements can during Presentations believes, call. intended in including estimates, Investors. Once selecting future access www.prim.com, website, statements. forward-looking that then slides everyone the remind to them to You next forward-looking I'd the Words the the section contain performance. call expects, by statements, projects, to you identify Investors webcast corporate regard company's are the today's find going to Events to our made for will similar on today's link may as may and such with or future like

uncertainties, statements, publicly other does not to yesterday's may as Commission. Factors applicable filings laws. those Exchange revise limitation, under of involve securities Form Forward-looking without and those period update including, information, a XX-K inherently other for as and Primoris section in or or in the any obligation any with otherwise, except discussed annual result undertake Securities forward-looking detailed new whether events and XX, in the portions future risks be report statements XXXX, December required our on and release, the and ending press Risk

at Investor the energy a be long over Primoris' for I Wootton. has in forward, job Relations, our and you Vice will opportunity new and as the Investor getting CEO, I I'll She'll McCormick, an investor be know a confident Brook President Brook as a Before I've Tom over I'd to finance like over great events, call going smooth new markets. Relations to all do utility introduce enjoyed will turn me the taking our in to miss Brook I'm investors role the analysts and seeing and our transition. but Primoris' a officer history of department. years, really into transition it

like over to the I'd our now CEO, McCormick. to So Tom call turn

Tom McCormick

Kate. you, third This challenges facing record was reduced the and the to is from results. us is and today quarter Good and economic widespread thank Thank morning, more our impressive you quarter pandemic, for joining country a discuss that for Primoris everyone, the energy prices all uncertainty. the given

We work quarter. turned was renewables continued and saw in our strong in performance nonunion growth gas quarter hours focus these civil The a the second continuing projects. our that our performance in burn safe business, our maintaining ACP is heavy we our the And now employees ending that the revenue and solar rate electric level. this year. in the we've strong achieved able the at project excludes they backlog, backlog, demonstrating work. third and market multiple utility Even biofuel distractions to quarter for were notice had formal termination incident with work from things quarter, incredibly continuation we in and Sustained to with by total maintain those healthy across our field target commitment recordable that received record over that our the while billion to utility keeping all services all have total have am a results in despite safety. the work markets, on deal margins pipeline below their work country I successfully a company-wide to client. which their in strength Working driven million of of businesses, definitely a through grateful driving we executing corner in environment XX $X the our

end our of strong cash across for cash and business will and our of execution, renewables upgrades investments flow ever. SG&A project strength Thanks utilities remains and particularly continued internal the as project systems markets the dividends in our our to as market. our electric discipline, to well pay run. gas robust, and as reinforces controls IT markets tools, HR backlog our the some We're is and stronger balance that long we sheet than expect in Our using

at specialty entering Primoris are our list also part growth be at the to ENR were number see included As acquisitions. XXX In of in strategy, potential pleased contractors we list, actively we October, the X. looking top

more we've profile contractors business risk model to list known specialty our top country. confirms more reflects Primoris the one EPC of from general the that specialty Moving the what always and closely lower contractors and the contractors is list, in

growth quarter take had a in even This resolution West look area asphalt in remains Civil starting particularly we execution benefited civil final from results, last and management heavy for and opportunities is current solid the results see on X project segment Texas. dividends. the segment our strong paving third segment. Belton civil But paying of without projects. heavy team settlement, focused the at with Let's the heavy on from structures, claims. the execution We The it

headwinds revenue and I&M the positive demand industrial in team market, The market to from strong will is momentum, up. project global a creating economy and decline with the we the solar face our but extremely continue some picks is executing management pandemic side, well expect challenging until what and controls. overall they market is subsides the than offset execution higher more On in the margins

segment, Power, the similar are & Within Industrial we facing Engineering headwinds.

improvement. under on profitable management the to to continues we on the difficult projects, of which second the new a sharp would refining the feedback largest margin quarter Execution remain margins. I mentioned in the to a year work of to glut markets. of with clients recent and wrap I we should refinery fuel saw on has also in in build The see challenged expect the particularly awards next momentum year, chemical quarter as The some As of which demand. last impact team for and industrial pandemic up our call, to complete the last has of led positive more the after expect been we from the reduction and segment rest Gulf the tight market

We the Coast to projects smaller pursue along a and California, also base continue Gulf revenue will this segment. in provide which awards for of maintenance capital and stable level more

Although work for renewables operate is to markets, the slower in we opportunity the in most Where continue we segment market. profitable our see is Canadian levels. this at

well project executing California are plus to accept million on earlier an refinery we existing oils. announced $XXX in We retrofitting that this vegetable year, the biofuels

will solar opportunity performance receiving our in missed pipeline both EPC seeing allowing nonunion units Gulf growth this of of work. to business as tons and and to our prevent The to another projects, to diesel expect recognition projects And also Texas, containing X over date. panels. square and double-faced for exceeding are of COX The million in largely of exceptional for field our projects, their opportunities this miles third construction the all segment, on project provide underground biggest our is our year. per again, nonunion Primoris segment of outstanding the in continue market the we we quarter, the has the contractor an to teams across industry-leading business performance continue facility renewable The which We coming capacity and XXX,XXX for engineering net solar services years. growth a great Coast. emission DC, In continues solar multiple had X.X once for completed pipeline megawatts generation one team's with storms big these facility largest led our opportunities execution. strong expectations the projects the biomass be quarter, us in by of XXX

their but and are strategy energy following with some of field through the services-type last work, on downturn. and headwinds of strategy menu including which repurposing very services, lost multiple As this challenges, smaller market followed expected, we similar we during energy the environmental larger-diameter replacing to is faces business to projects revenue the from prices our increase

existing already type clients. we with up Our craftsmen work, work experienced and of some success and are from picking this have new had

win on their out to that's awarded then as costs working segment any tooling in work of be the segment work crews California but maintenance busiest close still discussions outfitting we crews. negative normal saw out we work field. ACP associated and this still Starting some have the as The plan and grow is with release do project. has backlog, market the which new a full-time in quickly and norm slight work While as we help the and Utilities quarter. to on-site of potential the of typical discussions XXXX September, taken had projects distribution -- to California, are for The wildfires in the type to disrupted revenue overall to our the had project as in to have to late traditionally for region. continue are margins the in of third & needs work to is for Distribution mix make of move market crews gas the did this with impact The have quarter ongoing of

gas lump work, better Southeast, That over weather be we last Our sustainable. picked year, the And closeout from is in Midwest this one we levels. dramatic several sum region see margins higher-margin new national the quarter good double-digit We work reduced of to project. to our utility a customers we contract presence. going expanded across and from to in a improvement as up which during the larger country benefited continue the benefit third is equipment terms year believe and

our subcontracted. work diverse our of services of touch can on We benefit by a points is projects additional the project. to partnering example another to finding their renewables for we previously were with that are and also capabilities ability teams opportunities Primoris' as multiple This have provide

& strong the QX. Distribution another building segment Our momentum Transmission quarter on from had

quarter devastated storm. benefit appreciate margins that and to our offset work delivering rightsized had pleased positive provide, received we this very are from in on large and but now be support integration And costs quarter's we worked communities have storm strong a target With project while more confident transmission fully some are the incremental long crews storms. to margin the We was results, been business the mostly conditions We the appreciative our range. we as by on challenging start-up the we within of these by margins can in plan. now the that consistently that impacted power feedback have regions we executed of are restore that to our

gas As MSA-based share. are brought businesses Distribution under we we performance. of Transmission and established These and Distribution segment operate segment the market that the our synergies enter management quarter processes of integrated and move to is electric maximize increase of gone improve We to and forward, X to & scale, productivity continue forward XXXX strength, to moving improve manage position the Utilities learned their have & safely. have business understanding them how and we continue executive a the overall senior to the away, and but challenges the successfully not focus fourth and in have have

account gaining guidance out third the the increased and year dive season strength as history, impact winter work. deeper XXXX businesses slightly turn utility I'll our timing the is into in have and range in we we a the While confident can results, That to over are the that, XXXX. always numbers. momentum to unpredictable for Ken of close our for utility fourth said, cold we that With our is quarter it gas and will see quarter Primoris' in best renewables our

Ken Dodgen

review Thanks, Tom, to balance third results quarter our everyone. flow, I'll morning, and on sheet then operating cash move good backlog. and and our

that this X% revenue increase compared an $XXX.X third segment pipeline XXXX our million, to growth year. primarily quarter million quarter by This to was was or earlier revenue in increase $XX.X projects Texas of million third driven related of Our the an XXXX. in $XX.X began

civil were and revenue Utility California, $XX.X projects. power related revenue as Our increases million continue by as revenue increased improved segments to our as to in and decreases offset partially in rightsize contracts. These and by biofuels increased transmission to we work solar segment continued the modest drive million renewables segment $XX.X

to primarily quarter margins the revenue. X.X% in gas X Gross that the for were to third increased million midstream $XXX.X of X in compared quarter revenue. for accounted the pipeline prior year. to of a the $XXX.X increased QX the year, customers customers compared accounted in XX.X% collectively company addition, in XX% revenue profit in largest and Our XX.X% due utility million was gross in prior But to that

year. Our X.X% margins Transmission significantly segment quarter prior gross in XX% third recorded coming higher the the compared in at to

performance safety the focus management and work, to higher strategy on of cost during some the work improved the the we strong southeast storm quarter. drove and across had Our also margin profit, benefit

Our primarily well and due XX.X% on the good gross margins margins to with for Utility weather. continued Southeast higher in perform segment to the projects quarter,

segment in with the Power mostly higher Our an gross experienced in project decrease due LNG a Northeast. during to margin costs quarter, slight the associated

profit, strong and pipeline of Our gross gross margins XXXX. slightly but XXXX the Texas project recorded favorable higher in driven primarily Pipeline due higher on the segment were by to in multiple projects costs closeout down revenues

strong IT million, quarter referred be for low in the Our $X this year execution earlier. in a from driven year million the We due benefit, gross our SG&A expense Civil Interest range compared remaining a few an interest upgrade expense decline strong IT and X% increased year. rates. expect by due QX of compensation results our as and of prior some last $X.X full third margins the claims. was that in to balances to to the the But the incentive $XX.X lower expenses even had decreased had increase by high debt benefit to and expenses million segment project will the project $X.X closeouts. the we of final SG&A average driven good million expense our quarter quarter from to still X the without resolution Tom X% infrastructure to segment in Belton

$XXX,XXX the of rate full last that We compared benefit unrealized year. of the rate on fair million a this year. a tax from rate change our in our Primoris quarter, lost on in expectation remained and at interest The third it for swap attributable unrealized remain also had to at XX% -- this to effective the value full unchanged will $X.X is -- income we the at rate gain

of on our higher $XXX.X acquisitions. fully of income million. share. of cash these record strategy debt quarter. despite debt growth This attributable end and resulted support record-setting in results cash borrowing at from And no quarter available as provides move good This quarter end balance with of to $XX the of at the increase was million debt These quarter. borrowings generation balances $XXX.X working to the settlement times. the revolver almost into unprecedented was due momentum of is end of well total million diluted flows, we've towards $XX We reduced $XX.X on and sheet had the cash year-end quarter, third net Belton ensure to quarter deliver the or capacity. $XXX organic our claims million with XXXX. the quarter. third million $XX.X balances during and as the debt per been our and operations continued XXXX. Cash million during the net able achieve Primoris at show balance The flow along capital Strong a an of a over cash ready This lower $XXX.X our the was to by to $X.XX successfully as great $XXX.X us our results million was increase We the third end million million the quarter of management, we

third the $XX.X expenditures, million. million year-to-date quarter, we During on $XX.X spent capital to expenditures bringing capital our

leases. spend old usual, including buyout As the construction CapEx our equipment, is $XX.X unfavorable for million of most some on of

months to million to XXXX. be expenditures remaining capital $XX our expect for of We $X the X million

average approximately During per for the of shares third XXX,XXX quarter, at we million share. $X.X repurchased Primoris price $XX.XX an

of third million due approximately of under decline which a at We of authorization, our the repurchases expire spent the a current from $X.X the was on the end solely $XX.X end year. year-to-date total share QX, remains at ACP billion, quarter Fixed will of million from million backlog removal this $XXX of and have to $XX.X repurchase backlog. the

burned of remained steady backlog total quarter, of backlog record is billion the billion the impressive MSA revenue Our was end amount at given we and quarter. $X.X the at the which during $X

turning to Now outlook. our

earnings per to fully share. range increasing are to year guidance of full $X.XX a We $X our diluted

had in balances it we Doug, the With questions. Doug? very pandemic all, are can your the operational that, we ongoing strong over All performance. with Our guidance expected there? to a our turn uncertainty surrounding you quarter.

Operator

from [Operator Markets. line first the KeyBanc Sean comes Eastman Capital Our question of Instructions] with

Sean Eastman

quarter. compliments. many third Great Team,

Ken Dodgen

Thanks, Sean.

Tom McCormick

Thanks, Sean.

Sean Eastman

I'm of Power guess the the in I parts with moving So segment. the one kind struggling thing is

So clearly, to some piece, strong on. finger but like a underlying and drivers Canada the Western chemicals, for renewable your refining, it trickier sounds put little

as could parts if about to curious going you moving I'm think there XXXX? into through try the the that So trajectory just talk revenue for we segment just

Tom McCormick

right. All

Tom. is this Sean, So

I'm don't might industrial to me our away seeing a more I and I'll Let of refining not not can standpoint but your try you're is But what biofuels sure renewables. from I we're I little clarify if that -- of what seeing bit. lot and answer think question, -- movement a you the if answer, and groups, to from petchem

West that clients and of that refining won some got need diesel projects, to their we're Coast and fortunate that with this little good of it's market, projects. so in able in are problematic. And both it's biomass The ones up not out we of to number it reliant, for that their clients the which a -- we're still been that -- projects. a spoke seeing front design last finish to profitable very biofuels, whether of We've West although bit refining, we for are that. in we've just have Gulf doing got the have think when we other we've to the that should in -- in We've these or facilities have a and you contained. -- call, and able renewable. part were on to get in relationships project know know that had work we've the in that's in a We've We there's second front-end and of and Northeast. through of those California get year, it. one, project work to the kind enough it in opportunities then that. been costs lot -- forecast that ahead the we by the our of -- green those offerings that some actually one those are that We we quarter... of be issues complete as make ahead think more We've modifying gotten And had what We're the the still

Ken Dodgen

year. next Of

Tom McCormick

year. next Of

changes the team. management So have the some made in we --

I think getting we spoke are nonunion strengths that clients, our which results it's on and performance -- are to positive from of a to and we management last groups, the more positive from feedback of we're actually their what group. work. to build teams working. quarter leadership And and And is lot in their them respective and trying seeing leading

We have always always and we -- although projects, clients smaller believe. which now, albeit said

to to have projects, solar, growth because going us. are we in which smaller huge projects for And we out larger then be so Yes. our what the tamper and anyway. And away, which a opportunities you a the history to have bit go able is actually do XXXX, into is many little there's market to there. Going done have we've that

and if has work, We site lot of careful. relationship get their our partner and do project do -- substations. businesses You with with they've you're the other And we we there's do out actually we do on a pull-through performed great over there's do on lines. every exceeded the clearing, grading, But transmission done. projects. every We a can clients. project expectations done. also their from that your they've can They well They got group skis not

actually projects comes are provide. clients haven't on any work I it one-stop we've executed on which contractors think can that solar We that can we for when a those is But -- of be those facilities, We to shop yet. that. done that do can don't other that any there

year work business plans the in of looks there. or there that doing you it process will next. like the developing early So We're in be out I later right but now, XXXX couldn't and our how our answer on right that -- is for now XXXX?

Sean Eastman

in color. to targeted revenue put today, I'm as -- look All my be here, thought? maybe guess, I luck it's you. going back does right. to maybe like in just really grow Got gross and that preliminary maybe That's helpful XXXX on you margin sit range that all a pushing but segment

Tom McCormick

Yes.

margin I in range. going think we're to be target our

been in going I growth -- the you'll I think They it's segment, going been. it's projects be but But see with to the that in some to the think areas markets, in traditionally it's flat west we're growth. some win we -- opportunities out We If we're see not they'll see be that industrial that seen of renewables. after, and there year. this is we've growth. may typically,

PRE, in think -- you'll that. We're primarily the to significant it's within I going group. growth Renewables see see

Sean Eastman

you. Got

when Okay. Great. it pipeline out, really high underground the year burn that And on shows this underlying in pull a and you ACP backlog. segment,

clearly has better lot visibility much in kind what segment next selling you that segment? done than think of at planning you're this season Just point. scenario guys year. a spring sort seeing curious what this into I anybody year around how curious thought this around just going you're of But have have that would there,

Tom McCormick

middle quarter seeing also. spoke I'll Well, about of last this I what the you we again, we're are in that planning that. tell process. in But

it's bit flat, going think burn, probably It's be on back projects smaller, certainly their field service profitable. not replace type able projects. quite think to different and revenue we're maybe -- more smaller replace to bit then service to numbers, a lost will be revenue a little going going from And be services -- I ACP union a until talking I know the the because some offerings to I markets. it able don't yet a to in bit you're ACP of be final work now, actually the we're offerings, we're and was about group to which of ACP to significant the enough smaller be of right. see just clients But may that little -- but all

Operator

CJS Lee the comes Securities. question of next Our line with Jagoda from

Lee Jagoda

you So the did revenue as good on and Congrats as quarter. congrats backlog at flat. on maintaining while having

So that's awesome.

in and coming see expect Looking or pretty here would for whatever the quickly decided? as election, bidding now and in the kind consequences is? And lettings either any temporarily of at environment the outcome see year-end of of some we bidding the halt between the sort lettings to once did halt election you you wait additional is

Tom McCormick

what market In specifically, Lee?

Lee Jagoda

I would to hear all of love them. about

Tom McCormick

know I also. don't oil we seen or some we've demand, we certainly the in saw are business those that -- of second pipeline services. and waiting have quarter probably price Any to clients But seen tied field in the oil demand or energy for.

So quarter. to they're not new third the

is we'll expectation that Our change. see some

any think impacts while. plans, most not affect longer-term the some does clients' of that expected a I but our some of waiting they election, wins to see maybe are been projects on for regardless this may are that, known you're going works. -- have larger in the really this because and from expectations we've who immediate it We've

the we've some industrial, of we've just to In much around the these worked changed being those of little of are projects. reach to larger -- bit, concentrate on $XX because maybe function it. a $XX our And able smaller million, chased our but projects projects, not $X of financing. kind we've -- million actually So core of it's we a it's -- direction always point million projects

building big no about going You've this in plant He revenue we're executing he's smaller to he's in and build out every new smaller clients million maintenance been capital one group, X a projects, Healy's California biofuels project power probably projects, Tim's the for Union now there's large on Tim our that power $XXX Well, there. projects, where of on And Industrial replace able -- services. plants of now years, used seen getting a group. years. X.X to in with Group lot maintenance

-- able we've expectation lot tight. be to is replace bid slate is But our So what it. a the to going I guess, of been

clients some see. may everything you right so see the have better, the tell now. opportunities -- to which be going have else put means margins. see in money. bidders, Renewables, of out be to And there. You're they and really, I'll our There's -- tighter, to many pressure our we That's more on there's of some we'll more spending still then utilities, opposite are estimates

regions, is areas gas we're markets and in some of being utilities electric other moving these that in work And but then that's actually trying our actually, us And helping contracts chasing our get they're other we're clients T&D, their was gas have work reach. with and our grown. develop utilities, finished. some some expand MSA clients, just replacement And we're because of in clients. more more budgets relationships the and So out and -- work of done utility to

we seen lot off. a So of drop haven't

of those haven't we seen As a matter fact, drop-off in any markets.

Lee Jagoda

into One the That's more me, for hop I'll back queue great. and here.

integration there any up, quantify for as it might impact gotten cleaned I on Is in favorably way emergency of the done. had Just impact revenue you to weather sort QX? And mentioned to transmission I side. things know when do margin. impact you've the you you work, margin it the positive really doesn't know as got

quarter out forward. if margin onetime-ish expect could in of of help break emergency So going forward, But sort would going normal the modeling stuff a the we type that sort more we should range. just

Ken Dodgen

I us Lee, think quarter, Yes. X% the about it on for gave probably a margins. bump

Lee Jagoda

X percentage points?

Ken Dodgen

Yes.

Operator

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

Adam Thalhimer

to had take $XXX,XXX, what have was I shot model revenue no $XXX,XXX Because the I idea year. for over it at pipe. you then pipeline want year, this $XXX,XXX. and another to next

Tom McCormick

shorter because lot union these the It had very South projects but Houston. and exceptional -- fortunate -- through diameter, of more in runs, a primarily impacted nonunion with performance a couple but whereas the projects, those was projects, exceptional. bit. came in of industrial drive Gulf their of side bit we really growth it a quite And up that Coast, got really smaller the well, the never certainly little that couple did projects the hurricanes had We that weather affected were the helped again, -- the a were was side, those the on The them Yes. a not all the impacted numbers of interstate, cross-country, year. this

they're and there the bombed. So got coast on they right

pipeline, year, segment, or because of much they then is expect Next much how how significantly the business look different flat either X in if units bit. year, well or expect expect bit little went as little a the side, planning shorter would again, the and will diameter, -- primarily, or in our I to I because just ways be speculating. would smaller would this just I that not a got field win it's which flat $XX the they union -- X plan, of work million be than of and a below. little this probably And at in lower up will be just different lower, to fortunate this we're it a but nonunion services were the how probably they year. as so some were million $XX And XXXX below I'm I maybe stages runs,

Adam Thalhimer

But the to range. $XXX,XXX Clearly. $XXX,XXX you're range closer that than

Tom McCormick

Yes.

Adam Thalhimer

Okay.

that Utilities then you of XXXX. be question in had budgets? onetime-ish for for What & projects their CapEx are you same kind some the the in -- the So seeing Distribution. question maybe southeast customers were and would from think second I

next or just do there flattish? So year of you kind revenue grow

Tom McCormick

No, it grow. will I think

is of budgets be of work maybe the little clients, but change, I or remained same the our the be expectation higher. may it It's the type work in bit grow. digits, up. either our -- most Again, -- their to change, will going have a may going will mid-single mix the digits, think those actually utilities our of but not double

Adam Thalhimer

lastly, And Okay. then power.

half the and of releases, to better at bit but what that think half get like second said of I in you margin little kind levels? first a then margin pressure

Tom McCormick

the it's yes, don't I see Let that renewables, pressure. me caveat with, margin get if

Adam Thalhimer

talking just I'm no. no, No, total segment.

Tom McCormick

total struggling question now. segment. Yes, the answer to Actually, I'm that right

feel what a assume. got You for it, basically to

Ken Dodgen

Yes, you're I year yes, -- Is mean, you're year. next asking that this into so saying? about so margins what

Adam Thalhimer

normal said normal. were the up, is kind continue those projects. year. the right margins finish I things that thought to when hurt the might not next have LNG there the But you revert of for been some first I'm now. what then half in had to segment power It you guys sure of

Tom McCormick

the high Yes, LNG digits. single probably Northeast, in the with project

Ken Dodgen

Yes.

Adam Thalhimer

Once you through... get

Tom McCormick

through quarters. get the Once first two we

Operator

from Our & Company. Romero the Sidoti of Julio next question with comes line

Julio Romero

exciting Congrats for to news. Brook Kate and

Tom McCormick

Thanks, Julio.

Kate Tholking

Thank you.

Julio Romero

mean, guess the the mean, in margin first I and segment, slowdown year-over-year? quarters. third a in And on expect quarter I I saw that it be in if would So typically you comparable margin you fourth that you have year-over-year would utility by the so, while utilities improvement quarter? in expect you amount that seasonal fourth

Tom McCormick

No.

Southeast and closeouts we those of and the just of think in this I in that to year was third bump weather. little some the got the perfect kind related projects quarter

going which and year, as that's start, that look Midwest. I QX winter in about, into the to going our So weather up margins emulate this we margins talk the always we with is expect X down caveat step us to of of shut the is to kind normal when Upper for

Ken Dodgen

pushed that pandemic and It the slow, it we the the benefits getting was in third. certainly also Midwest we this very third for quarter again, the done some have had pushed one of in traditionally just the pushed what But the out us. out, to third quarter. and would going into because to it's second from we like be is, second pushed, clients of first the up our was North, the in our quarter that And traditional from work engineering quarter materials because that had of quarter year

Julio Romero

Got it.

in that So percentage traditional like got XX last the you segment? quarter fourth

Tom McCormick

Yes.

Ken Dodgen

Yes.

Julio Romero

opportunities under see you you maybe more and executive. market opportunities and you synergies, into the in Okay. that in just gas remarks, the organic some of electric? dig little utilities senior a one share T&D Can bit And prepared the you on and growth I believe see mentioned bringing maybe

Tom McCormick

common thing they two industries, bought one lot the share a of they is -- clients. Well,

We have a lot a clients. they -- have similar so very

the we doing So to or the of by have a only the a doing business not we another can it of benefit manage be we revenue than of unit team do or them on now with of from because cost we have a offering some just client. pull that efficiency savings you there's -- trying for in by And by under And advantage benefit now side relationships single executive, electrical single gas a an other can managing the region single can work the region. where of -- other management there's the another side source. clients -- create whether -- rather pulling work. We're doing

doing allows just gas stream It we Let's we that to T&D revenue do another can done, them, the also for say, work. they If client. cross-train have work We're for it's gas line. us electrical a creates us. can put also be work employees. gas It to

but those a cross-train those everything, to of work of in cross-train employees businesses. both can't to everybody we You be number

is be up move workload to those the have you because continue to diversity, in one, the work. and opportunities resources work other of in when and to the So down able pick

Julio Romero

for me systems in wrap expected think mean, I upgrade, I'm mentioned construction but Got equipment upgrades, just to I is of beyond. one have trying it. relative maybe kind and go-forward would maybe to my around less And your head CapEx you IT internal you last than probably XXXX. 'XX spend

your and strong, your cash balance quarter. the is cash So at this end very -- of

do 'XX? maybe what up ends think you at So CapEx

Ken Dodgen

things For 'XX, it we high new this very similar be We've facilities, like be investment have to other year. new it that, I of in offices, because is about what this XXXX expect not which year. talked our had to

$XX we're somewhere be thinking million we'll still So year in the next $XX range. to million

Tom McCormick

have very year. to be bit And next year. we're start X probably similar year going more facility much this -- not work to a because may it that But this be do on little some but will we

Operator

[Operator Davidson. D.A. Instructions] line Zane with Our next question from of comes the Karimi

Zane Karimi

Congratulations the quarter. on

Tom McCormick

you. Thank

Ken Dodgen

Zane. Thanks,

Zane Karimi

this As would Does want the or any ACP? And on to a the I cash on continue? strength more stronger to little around flow payments detail those that the off, fees touch as well bit quarter. first related So reflect quarter.

Ken Dodgen

Yes.

scheduled of So just good payments basically had was working That with also ACP $XX from that guys of there's into management. terms about settlement. is and was. of values, respect really no some We just my and fairly during in TxDOT that necessarily rest sizable, teams got million, anything was we quarter. capital good The customers, I we was mentioned billing cash quarter very like There it, a as big that the fees to comments, that was turning came or that in and that timely working the a just timely. some capital good cash had with getting contract what paid frankly,

of segments. So capital X management great working part all on

You the AR and vast statement can it. the majority cash course, and look see, it was and just assets in that contract normal in drove of flows change liabilities of

Zane Karimi

say And much follow-up think around the target they're know the question how bit an profit but gross on a couldn't a on you was I then headwind Northeast it was? you. Got below now. think plant. LNG little Okay. you, of after over year? can XX% the quite to back I get the to earlier But quarter. did I margins And power a hear right I XQ range you next

Ken Dodgen

Yes.

probably of So to us basis quarter the that during hit for a project couple points margin.

what by right be to higher of work range, our there, time the digits, project which the is, couple we that course over be normal segment. XX% through next should get course in year, that of quarters, single And around expectation should so QX that next we the of rest as for the up we X.X%, of

Zane Karimi

renewables represent one do the where last What then through now quick. does you business that And And Primoris, 'XX? Okay. goes revenue? real think like for

Ken Dodgen

it's meaningful power of don't break the that segment, But We definitely out Yes. segment. portion of normally the a it's revenue fastest-growing segment. and portion within a

Tom McCormick

Yes.

due see going segment XXXX significant growth to You're to renewals. that in in

Operator

questions further to queue. McCormick in hand for no are call the I'd to Tom the closing like remarks. back There

Tom McCormick

Thank this Well, of for taking Primoris. your I families the healthy that thank hope you you. and of are be your and to you. We support time with on us call appreciate all you safe. and

Operator

teleconference. does you for today's this your Thank conclude gentlemen, and Ladies participation.

at time, wonderful your a day. disconnect this and lines may have You

Primoris Services (PRIM) 8 Nov 202020 Q3 Earnings call transcript