IEA - Earnings call transcript Q4 2020 | Infrastructure and Energy Alternatives Inc

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Operator

Good morning, and welcome to Infrastructure and Energy Alternatives' Fourth quarter and Full Year 2020 Conference Call. I’d like to note that all participants on today’s call are in a listen-only mode. And with that, I will now turn the call over to Kimberly Esterkin with Investor Relations. Kimberly, please go ahead.

Kimberly Esterkin

Hello, and thank you for joining us today to discuss IEA's fourth quarter and full year 2020 financial results. are Moerbeek, President Chief Executive management, Officer; Chief Financial from Pete and Vice us, JP and Roehm, Executive Officer. With President and

filings. like the with considered discussion press risk the undertakes as go note law, no financial The its IEA's call the in measurements Except forward-looking ahead, expectations. some today's press turning reconciliations call yesterday's statements Please after JP that, as to to will release company's with and Executive statements I Before over Officer. factors IEA should the forward-looking And found GAAP be financial appropriate JP. management be Chief statements over future I'll growth the obligation to that be now non-GAAP conjunction EBITDA. by included forward-looking contains update would call. yesterday's this SEC Any statements can Since in turn in about adjusted and required Roehm, financial management, references, to including cautionary in presenting release.

John Roehm

you, good our morning joining We you appreciate call. conference earnings and thank Kimberly, to everyone. Well,

revenues this record XXXX. a While fourth with record the EBITDA about quarter, adjusted full is XXXX the achieved IEA to want in results. I call start and

the the and achieve XXXX, to an The we daily able protocols end Our sheltered up were was social above the in projects, year, essential precisely and but they almost difficult we that increase costs measure sites. the precautions, abide adjusted of our and Last but to have revenues with XX.X% overall. our not and infrastructure, we scheduled. We materials increased our project up COVID-XX able continue X.XX $XXX workflows at from the reportable considered to see of pandemic safety our complete the result pandemic. range. with worked. COVID-XX of by to year-over-year. we XX% by in rate $X.X and we we That related consolidated do industry these X.X just delays services high billion from metrics than distancing our is to man-hours to as a were are at improved provide extra were were for overshadowed EBITDA It delivery practice million, impact projects inefficiencies impacts but year-over-year, incident million also our some guidance about XX.X% were adjusted EBITDA the Even Both year of is responded, experienced as revenues we almost teams total our the resulted our and rate impact turbines safety lower standard. pandemic,

of Enabling solar and to of continues of generation term. have energy part than wind as very year. the totaled for saw backlog the PTC instances the slower-than-expected renewable and to of Our at tax final projects remains credits. past been The impending the and end may a the to some that months. cornerstone stock, sustainability social as offering, quarters committed we also the the to overall in in business, canceled from high, X IEA XXXX and delayed percentage governance push transition. our month, none project approximately strong have improved been expand Last look their Alternative secondary number solar our process the successful begin renewable flow, country. year, power of is the our $XXX by energy sustainability to stock remained wind and or of a the projects Atlas when and are The environmental, less to Global was a to extension of the X%. the some has our unlike Energy liquidity then Index allowed reduce complete The ITC ESG many CIBC billion ESG near dates forward the step of reducing of million enable we to X urgency and the which been $X.X December to of increased transaction base. start for is a activity Index, for end our in construction projects due of added this down revenue and approval equity to Bidding activities Energy ownership to of and in allowed Clean to that report common adding Clean derived including stock matters, goal shares Energy completed sector we shareholder issuing indices first fact sell Wilver Oaktree almost free Ardour coming of our and institutional us our holders in meet affiliates trading past the the Index, Hill reflecting

transaction, of to I Peter this to of part has representative our down. on As IEA. Jonna, stepped thank Board, Oaktree's many Peter success his the for want contributions

Let to turn me now our lines. business

$X.X Our of year, billion for number we XXXX XXXX, the generated completed of projects. Renewables over for XX% of an wind segment, successfully a in larger accounted which increase of revenues as solar overall XX% and revenues

wind see in market. to our continue opportunities We near-term

months Shady contract Then XXX-megawatt For the In were of awarded state County. in we County from Illinois. X for won December, Lea example, sourcing XXXX. wind farm renewables Glacier December, Sands XXX-megawatt the the a in X XX% its for project secured in Mason for in of last and electricity closer will since we by state goal wind of projects Illinois XXX-megawatt its a in of the achieving January, the These farm II to farm contract bring Lincoln County. Land in total Oaks Morgan wind we our projects wind the

performing grew XXXX, XXXX. in $X from well, to is up and Our solar million million revenues $XXX in very nearly division also

to generation. Last growing corporations announced been energy the also were a offtakers renewable employees And Georgia. to Solar strategy portfolio of burgeoning in are to County, will part for from secured renewable to the Georgia, in a expect we farm has we the solar Meritas grow demand a in half business meet power The XXX-megawatt Facebook addition Lumpkin the is to solar responsible them Lumpkin to solar. January, contractors. of purchase we XX that the interestingly, signed and of demand construct this In agreement for infrastructure, of team Our Farm contract complement in center week, data seeing a experts projects from XX% corporate team of our Stewart We're supply sustainability, our engineers I of the first energy for operations. XXXX. solar and the

our now of to solar our support, the this base. addition controls SCADA team, added performance and to optimization With enhance storage and in-house development have plant prebid expertise to in access we client offerings

in utility-scale performing inception projects special the solar ability of are the and customers, to of whom a is key our That wind provide engineering differentiator successfully project. is expected us, same capabilities as many our solar the bidding capability customers. by For at the utility-scale

end added blade addition, on tower exchanges quarter They year, provide call, In business the composite and wind also at of we troubleshooting major we segment last in third third-party our component repair to on services our renewables a up repair. and discussed as services. to work commissioning

a pleased them with year. to make meaningful the this We contribution rapid and star expect are

segment. now our Turning second to

slightly total Specialty compared Civil as minor the XXXX revenues we -- in mix down for accounted timing Our million, changes to $XXX of construction compared due XX% to year, in projects and to XXXX. of mainly segment the prior as or

annual primarily pandemic Rail line to of impact we in business business line experienced revenues, both these declines and win Remediation slight our due Environmental continue business. the solid nevertheless, areas of Our to our work in the

that XXXX. in an quarry hauling Georgia, and coal remediation For the the U.S., projects a example, structural project will at quarter, wins we And of opportunities Southern we in ash States, a We range drainage from sale new project and XXXX. U.S. transportation in including added Bridge believe remediation United Mountain in regions our our on-site the business of And revenues work in Roadway slightly new to business see landfill increased and in rehab and Alabama. erection Midwestern West the projects construction our the fourth in West during in

our detail Pete CFO, Moerbeek, XXXX fourth drivers into now and over get discuss the our turn I call to to financial Before going growth Pete? guidance. forward, on I'll this more XXXX for results business quarter

Peter Moerbeek

listening. to thanks Thanks, JP, everyone and for

not our promise those As and yesterday, XX-K we all issued numbers. filed our earnings I press Form repeat to release

winter As activity. timing profitability quarter of the weather all compared the fourth in decreased quarter projects the of and resulted construction fourth begin renewable decrease is profit gross and to XXXX projects XXXX margin from revenues, Historically, The our in gross reduces compared first profit as we and revenue quarter expected, XXXX. in of XXXX. to lowest

benefits the projects Second and step at Earlier fourth profitability accelerated pattern as winter resulted fourth the the quarter which customers excellent many scheduled down profitability the they was historically, we us quarter This year first have early construction of slow in and than late complete ensure early cycle. in third and of quarter to changed completion in revenue in in weather and XXXX for projects started the we increased, mechanical and the to starts down. for many and receive XXXX allowed XXXX. XXXX This achieve in earlier would projects to begins of while the to record end calendar PTC, revenue XXXX quarter and which effect, XXXX.

quarter-to-quarter. Our revenues may and fluctuate from profits

XX up profit And year, revenue basis our renewables billion, margin we gross record XXXX. achieved for the from by the improved $X.XX For of XX.X% segment points.

full X.X% revenue, In the in the quarter of these year. X.X% X.X% the percentages were As the XXXX, year. for and a fourth percentage fourth SG&A were for expenses for X.X% quarter and

we XXX% close have as expenses and reasonably to revenues more to slowly, improve have systems information in our will the look our technology expect risen a our current by company. years, X larger reflect almost that we run much our rate SG&A remain While we to increased past

In and $XX.X our projects flow It was as our but we guidance, counterintuitive, construction slow, complete $XXX.X from some the operations a as operations we quarter, the decrease. million. positive seems from operations for a financial backlog was and working and capital other more cash needs to little turning million, Before highlights. fourth cash year, generate flow XXXX cash

we $XX.X financed which expenditures X% XXXX. of the the quarter this will XXXX $XX.X our totaled Interest million quarter year, For of financing approximate were that capital from revenues. $XX.X expense million fourth million, capital the million, through of our in At leases. for $XX.X was expenditures down point, expect

dividends on million Adjusted was increased for $XX.X totaled interest paid a our we quarter, expense $XX.X from $XX.X as $X.X in on the adjusted basis, $XX.X our million $XX.X EBITDA preferred up and On for year-over-year. EBITDA compared million Series the of $XXX.X above million quarter dividends. high stock. paid end Series to XX% year, to in in QX expectations of million the year, XXXX. the the XXXX. In B approximately stock fourth year million million full B And we the For

had we we million, December XXXX, our outstanding cash million available. XX, credit no sheet showed leaving of cash $XXX letters facility, As $X.X balance million, did revolving of credit but million drawn our have on of $XX.X $XX of

$XXX.X due Our and step term no million, have to XXXX. December loan structure. first until Last took we amortization capital remains a payments month, at our we improve balance

performance in financial we to X complex reviewing Given our capital the our structure. over and rapid the improving the past approaches changes markets alternative years, capital are

for fourth close we backlog. turning Now In added of billion, XXXX. at to quarter, $X.X total a we the million to end $XXX backlog the were where to of our

competitors. $X.X in to of in experienced of have not the projects, We and XXXX. nor delay we during have billion recognize to cancellations seen that notices we projects expect to backlog a significant lost We've proceed projects awarding

the guidance. on Finally,

past The Let sky me woke and streaming a sun Sunday, outside. looked metaphor. it my This into perfect blue when the start was up. I apartment with Indianapolis was

our billion drivers plain provided operations our of that customer effect revenues wind for of of Texas, will generators as $X.XX and JP call our come performance. our us quarters. in said and second However, that this schedule. will We unknowns Similarly, just JP last as that's at the equipment start much other third makes the call, And degrees, weather revenues the Thank few turn our remarks. overall when be impact for it Sunday of That and first expect between of and are as potential the moments, XX first year. I these as can in we walk, it the events, The revenue and compared the still expectation. to On $XXX such to contract growth now quarter awards. and positive closing Significant cold. to expected turbine his remains The range million revenues $XXX impact adjusted billion many delays quarter usual, adversely is $X.XX million. I'll our back severe And as to exists will in can XXXX there impact XX% cautious in in continue in then cold but discuss cold. still business, our XXXX earnings pandemic the lower a I in EBITDA now started you. XXXX, and was and my but

John Roehm

go in count this United with renewable year. solar we a EIA, Well, markets. short, investment XX.X thank for Energy space, XXXX. across growing utility-scale the wind our surpassing growth direct with the opportunities beneficiary remaining States. you, new project a In continue for continue records a previously XXXX set prospects in projects the or The Pete. With XXXX total to operating set and will for see to high this operation high, IEA global is our of in bidding in segments. U.S. anticipates renewables gigawatts Information solar With commercial solar both strong the growth of Despite energy Administration, new trend pandemic, the of

are of December, XX% Solar that production project's wind X-year will generation. from new XX% of was XX%, energy the investment of credit tax a and Further there extension at solar energy be means and carbon-free value. of credit X-year tax extension renewable come wind to XX% that a and the expected respectively, markets, for driving in for the the the XX%

eligible solar, and XXXX for into by are wind extended both projects credits. For service placed these

that will is of credits. extend federal demand work We the renewable hopeful are growing. stimulus new for passage The these definitely bill a

XX This the represents energy and pure-play and industry. IEA Over expects utility-scale a renewable the construction opportunity billion EIA next retirement fossil nuclear $XX retired. the solar of And be procurement years, will the for and engineering, as believes X a gigawatts the constructor, benefit. wind

took XXX% that XXX% credit industry. campaigned current sources, Climate Accord catalyst the Present And or growth tax U.S. renewable also drive the Obama forward. achieve a procure the extensions, and by renewable XXXX. a further reinstated In for renewables the since support clean energy agencies of plan has Biden renewable the Plant is Clean federal of regulations help to restoration Power national on energy the key strong industry Paris the office, the Biden renewable to mandate administration EPA a to The would addition rejoined for industry.

Renewables, Beyond strong growth for seeing are we drivers civil business. specialty our also

railroads which trucks single can to several importantly, actively with XX% including ash environmental American the of In roadways, decade, IEA additional residuals freight XX% regulations. ash the more of relocation and of and rail is this times ash in coal impoundments ash been The and the landfills In safe carbon Railroads the that to relief of driving to than the the work, the The serve remediation improvement of hundred the U.S. And infrastructure, next contribute terms today, of there remediated. a congestion emissions. environmental landfills closure opportunities combined in of the of coal to replace $XX XX% There closed commuter experience for opportunity in increase over are train projects. as alone. few needed ash construction XX has X new would X anticipated and market. Association years the present, to country reduction coal exceed our at only have space, our that significant coal times over on a a in efficient with semi-trucks, rail than companies are freight stated ponds, work, coal next comply the volume growth the more more aging are XXX remediation opportunity but could or billion scale

anticipate as Secretary, approval of bill America trillion demand the With fastest won ensure improving systems in user, infrastructure will trend recent benefits President rail fellow and should towards the grow. the Buttigieg, the Transportation safest I to of Pete Biden We and rail infrastructure $X for growing his a note, nationwide, transportation environmental our cleanest, that has the that system.

are highways X/X recent required and estimated of opportunities, their with work transportation need billion report For our repair, just most an to potential both bridges have up measure of XXXX. the generally for highways to of in expected Road billion get that funding of that bridges passed There larger are receive also $X.X the Department infrastructure highway grants $XXX nation's for in projects, late par. Association parties. State through relief noted increased funding support and COVID-XX to and Transportation in is the and American Transportation which in the U.S. Builders from

revenues in Over to the nearly revenues. past million gone X in $XXX billion has years, from just under $X.X IEA

could through improving so for are I right time any the nation's the combination environmental the of IEA's and at of is infrastructure, end organic right clients which want you right drivers in past thesis Thank political The be especially for and growth female incredible business, employees transition made enabling this year. Women and history. our Week, not markets, both acquisitive We highlight our our us U.S. joining have we the during all the country And done fourth by this in energy growth, supporting again a stronger. this those in that our transportation contributions call. for the made the of morning IEA supports our by since employees. to thank Construction quarter is

shareholders. call we you please deliver forward look This for our our to business, to on remarks. and concludes look we strong questions? opportunities capitalize prepared continuing open all As Operator, our grow to results of to the our would

Operator

[Operator Instructions].

comes D.A. Davidson. question line of from first with Thielman the Our Brent

Brent Thielman

did is great year. business XXXX, I you $X do billion in business about JP that in which really you outlook? in of and think in particularly How guys the the guess, Pete, extraordinary, wind first question, revenue context XXXX,

John Roehm

out, XX industry from anywhere you XXXX. The XXXX. XX listen who to, is gigawatts expecting depending in outcomes similar similar hear on to expect build would you for We a

-- the similar of activities analysis seen, we the is from would we've -- we saw market would that in XXXX. our to what I So very

Brent Thielman

it's you get what business JP, the talk XXXX, but And could business, you're about maintenance I particularly, of scratch of Okay. anticipating targets the just can hoping business sort the you're wind here, starting in know maybe any from to? sort from

John Roehm

a out that for that's Well, that ground, speak, team management is Brent, you with the target our certain tell can pleased we together. guided extremely is and management so very I haven't to getting to segment how the happy of brought what business, with we of but

believe a But do not year. this be as remarks, I to that said will and contributor it come we line segment. we're think the revenue to specific So bottom for out we our in for that prepared guidance both with meaningful business

Brent Thielman

Okay.

On necessarily this that you this certainly you're the just But do about but side, that. it's an come years. maybe mean, for sort And assuming in about what growth imagine want to JP, to most areas I infrastructure back out I in year, you're a excited most Civil that can't the some XXXX? of business see we get in benefit for what optimistic bill, particular? year, end of

John Roehm

civil, benefit Specialty which believe of the embedded I that think we're do infant is We environmental the Especially kind energy our is market. that in Civil the of that business, transition, growth. for ripe of a segment as our stage of

As market we commentary, $XX the of this ash addressable that a believe We decade. over coal in been remediated the it's of XX% talked only in billion date in has next the country. to excess

And business. see some relief of to our that of But fair I So of COVID frankly, cautiously what as such into freight hope Obviously, I that to rail service and passed segment bridge all to we're bit out market. rail. to been doesn't was we those. that of market for our not coming brisk COVID consumption kind opportunity. experienced regards expand so in reach relatively that back and we And continue a quite of in diminish We pandemic we continue, highway the our think -- transportation, some as year. passenger along up drives customers, that opportunities we industry. our do but optimistic opportunities far, legislation still But about assistance share areas other quite decent kind business rail only see of in that we've get this we've of side, the size in December bidding seeing in know the wind the spins that taxes continue

opportunities so far, forward good Specialty Civil. going in as as So far

Brent Thielman

for one me. Last Okay.

of? ongoing stuff the disruptions should Just across been this of that's projects But is period it, the the you seasonally, all coal out about pretty for is major going country and you the anything ordinary the we a to talked Any on. slow aware Pete, anyway. some your of be

Peter Moerbeek

just aware like that during we working who's slowdown is in think see event did of Well, a most I a few everybody work that ago. of anybody weeks well climactic Texas, probably

we So than short-term certainly, impacted were other that. no. by But that,

Operator

from Dilts question Our is Stifel. with the Noelle line of next

Noelle Dilts

Congrats great year. on a

to wanted of are so a horizon lot or think on of these is is I stimulus think to more see awards. the that Or that Biden some positive first, just you think is And sort ahead of renewable can delayed sort of anticipation the any that do you to be related what market, energy. about things thing, you do ask and in flow looking of do going I of But of helpful. would Obviously, award with this COVID to sometimes terms on?

John Roehm

think almost We to COVID. entirely it's related

longer a business. we permits side upfront. particularly takes It's our like everything know today's of get the It the are. back office a don't clients our for in in slower to client little I in Just of ours a yet, works world. little renewable of

our processes financing. their course, lot clients So a And just for require internal slower. approvals of and such, work

So moving the slower. little a finance markets just

a nothing in kind and just just that slower. in normal, backlog, things where come today, alarming, COVID little So but -- new we're the of

Noelle Dilts

the come solar to of really us believe contracting And and key just to opportunities. That's choices a And as more remind across as relates you you differentiators contractor market? it kind then why Okay. starts of second, Great. of it to of out? of work have some kind as more of you the have of this a obviously, the you optimism the Could solar industry lot relates helpful.

John Roehm

stage far -- ago, where lags Certainly, much of as would country a builders is the was say, as solar of the kind personally I wind developers are in good you'll the now market wind the it the It is now the see question. or reached maturation. largest where Well, market market reaching what that decade wind us you investor on any wind wind owned at competitors. lost our if our largest as of States, quite contractors similar United list large IPPs the that today, customers, looks utilities. it utility-scale same the look list And or not the large -- the looks or it's, solar remarkably -- remarkably to frankly, in

So it's demonstrated time. projects. in business, with time time these ground again, contractors And methodology, want certainly, customers how the is the the large renewables, the important. involved And very and want get our important projects the given quality very a -- span ability on think, having a the the these those Noelle, familiarity and short safety, time the the with CapEx they have and in who delivered -- they as there that well, know, projects projects price clients want delivered, I relationship-based you are to

Operator

reached this At for closing turn for we've the allotted time time, will IEA, floor of and to Roehm, back remarks. I our CEO JP question-and-answer session,

John Roehm

results. operator. here just on pleasure some look a welcome quarter to Everybody first with forward Thank short early stay you you, report safe we and you thank May and we today, been healthy, when Well, weeks And a spend to you. our away in and all few you time then. seeing back it's

Operator

conference. today's concludes This you. Thank

your for time. lines this your at Thank you participation. disconnect may You

Infrastructure and Energy Alternatives (IEA) 9 Mar 212020 Q4 Earnings call transcript