DY - Earnings call transcript Q2 2020 | Dycom Industries, Inc.

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Operator

Ladies and gentlemen, thank you very much for standing by and welcome to the Dycom Results Conference Call. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given to you at that time. [Operator Instructions] Also as a reminder, today's conference is being recorded.

I would now like to turn the call over to your host, Mr. Nielsen. Steven ahead. go Please

Steven Nielsen

Good attending I review this XXXX quarter operator. thank our like you fiscal for conference results. morning, you, would everyone. to second Thank call to

X. slide Going to

to During a found this our Center be slides Investor page. website's will throughout identified call be by on slide which number can we presentation be Relevant will main referring our presentation.

Chief our the call, Operating DeFerrari, our Chief General Tim Officer; Urness, Ryan our on Financial Estes, have and we Today Counsel. Officer; Drew

the turn will Now to over I Urness. call Ryan

Ryan Urness

to Thank The this are made and results pursuant actual These projections current management's XX-K its with Company call outlook statements, provisions Litigation XXXX and and by and may Securities Safe to risks and the forward-looking estimates those fully other current annual made expectations, These Securities of filings March including the Commission. Company's you, are Xth, are are on Reform related more and Company's statements based described Steve. XXXX. the from differ management subject Act the Private may on uncertainties the report estimates. be US which during cause forward-looking Exchange uncertainties to of filed risks materially Harbor Form and in to

no The forward-looking to obligation company statement. assumes these update Steve?

Steven Nielsen

Thanks, Ryan.

X Now, our second review slide a moving quarter to of and results.

the filing. for quarter storm restoration during As from million we Also discuss revenue our ended related tax results, amounts the XXXX provision included organic $X.X this year revenues a please income taxes July note services. for exclude that to XXth, previous quarter

and corresponding We non-GAAP reconciliation you website other the measures section for these in accompanying a measures. to and to of we refer report slides, these comments their measures. our items our exclude GAAP During the of quarterly non-GAAP

by has Company program. large customer produced a entered modification the revenue addition, into increases contract the that a In

items for quarter prior contributed an performed related As a these for contract to XXth, million net after-tax expense. performance-based approximately $X.XX compensation On recognized $X.X per in the $XX.X the Company of of ended and share basis, income periods or diluted July services million revenues result, $X.X million common XXXX.

increase million, of an year-ago XX.X%. $XXX.X $X.X the revenue was quarter excluding Revenue restoration XX.X%. increased of million services storm in Organic

wireless/wireline reflected we increase wireless wireline and in customers. networks, demand X an gigabit this of our five quarter networks from networks, converged As four deployed top

Gross the impacts program margins the customer our of large discussed expenses first X.XX%. XX.X% were quarter previously administrative of on revenue, call XXXX continued reflecting of fiscal general a and were and complexity

factors of earnings quarter. and XX.X% ample million to produced of adjusted $X.XX compared All facility was EBITDA diluted in $X.XX per share $XXX.X the of $XXX.X credit under adjusted our with or these revenue year-ago availability million. cash and of was Liquidity

applications. or or These XG to networks technologies. X are constructing Now, high XG provision wireline directly and major slide networks businesses, deployment converged sections significant long network expected gigabit using of to is a an wireline broad wireline fully X. that of decades wirelessly integral moving deployments across industry to networks the upgrading low bandwidth, Today, element either country. to designed what generally speeds are are participants consumers wireless/wireline enable of will be We latency believe individual

are effort to set industry continues networks our of industry deploy robust. The opportunities, in broaden these to meaningfully opportunities required total aggregate converged

country services several a dozen to areas We across services for aerial are planning, gigabit the construction, providing X program provided and in fulfillment are design, being than wireless more of these management underground engineering customers. deployments, metropolitan

are a multi-year basis. Potential wireless/wireline managed networks multi-use planned as well entirely construction Customers market network. as being increasing market of traditional of network and franchise converged initiatives Deployments include wired boundaries. outside on opportunities pursuing network wired are elements customer that consisting by are

industry several services maintenance and to and planning, value integrated is ability design, procurement and to construction provide of participants. engineering Our particular

competitively service We timing to may considerations valuable remain and modulations well to our also that and customers. volatility timing. position impact, spending deliver our financial us expect network We scale normal strategies confident technologies deployment some tactical evolve, unparalleled as customer our and strength

slide to X. Going

to during demand the environment of experience services effects customers. with of strong a overall top revenue four continue excluding from Organic We XX.X%. industry increased increased storm our restoration five quarter

top customers produce combined Our revenue increasing organically. five XX.X% XX.X% of

customer million of grew largest Verizon customer customers AT&T was all increased and organically was revenue. million. AT&T or Dycom's Verizon XX.X% XX.X%. While XX.X% $XXX.X of other Revenue X.X% at $XXX or organically. XX.X% our revenue total from second grew organically. largest was

grew of or XX.X% XX.X% or at from CenturyLink was XX% was customers Of $XXX.X and where And revenue of largest organically. of customers at the grew note, all consecutive the organically. other our fifth top Windstream or third is million this XX.X% CenturyLink organically. customer largest our Windstream X.X% in grown was finally $XX.X excluding five revenue. revenue. second quarter our aggregate, was have of largest Comcast million. fourth customer our customer million $XXX.X revenue

planning with encouraged to are geographic program organic growth fourth have continued our of management We our our quarter expand services. network consecutive and extend and reach double-digit

direct must the as deployments several dramatically long-term and wireless/wireline outside of increase our operations maintenance of converged our will have a And believe and be the and those over we of maintained. fact, that business, deployment network years last which extended parallel trend, amount value in the networks X gigabit plant meaningfully we increased wireline

backlog, is renewed and solid backlog approximately billion work we as at the slide this was over million. $X.XXX quarter, of to of the to new booked Backlog quarter work. The total billion XXXX reflects existing decrease at billion be expected $X.XXX months. moving April $X.XXX the completed end of $XXX a X. performance the in second Of versus end next calculation Now the XX

a anticipate broad array opportunities of continue across to substantial customers. We our future

services we services services Tennessee, agreement construction in From Frontier CenturyLink and with For and Wisconsin. construction AT&T, for in in quarter agreements Florida, Headcount and Services Illinois, Comcast California, Nebraska, agreements Colorado, TDS increased awarded construction in Carolina finally Iowa, Wyoming, we construction were South during and Carolina. XX,XXX. services North Kentucky, the Michigan Fulfillment to from agreements and Missouri secured

review Now to Drew turn will outlook. his I call the for over and financial

Drew DeFerrari

everyone. morning good and Steve Thanks,

were X. increases for slide The contract revenue $XXX.X and four QX was into a increases 'XX revenue growth revenues to with Company modification organic customers. that from five Contract by entered produced Going top large of a strong our XX.X% program. million customer

at $X.XX quarter. per gross and the contributed the or XX.X% for common contract was million XX.X%. were basis, a compensation of years As performance-based $XXX.X performed revenue fiscal the diluted $X.X contract Including $XX.X million items On and services EBITDA result, well we of benefit modifications, an million of revenues of quarters adjusted as share for recognized in second related prior after-tax these expense. margins as

XXX 'XX. points Gross margins basis large to due QX XX basis a the from benefit to improved impacts program of compared included gross the points to basis QX by approximately compared 'XX, in XXX during quarter. expense points of modification, the decline customer margins was G&A net contract

Our lower performance financial a decrease compensation. resulted in this in year share-based

for previous income provision year. Our to $X.X tax taxes related tax included for of expense a million a filing incremental

expect effective awards. before any at for the of based rate settlement We of tax XX.X% tax the remainder our share effects of fiscal XXXX

'XX diluted was adjusted Our in share. non-GAAP $X.XX per EPS QX

to Slide going Now X.

large million of credit July quarter our of of with ample revolver $XXX is activities $XX.X business. from in at We days program. of our on which combined sequential balance the quarter million at for customer sheet strength ended consisting availability borrowings. of reflects cash Our revenue hand. the $XXX million capital. used and and accounts Cash a The DSOs and term facility Liquidity $XX was million, the assets growth funded the on of operating loans net outstanding reflecting XXX and the flow contract working growth receivable were end

This disposal range to expenditures $XX.X million our Capital from capital we range $XXX capital million disposal CapEx and year. $XXX fiscal for million a balance full were million. million continue the to in strong to proceeds $XX anticipate was a summary, net our sheet reduction We previous gross and maintain liquidity. of proceeds from outlook. net is spending expenditures, of ample $XX.X of expected In

Non-GAAP slide range quarter XX, per to of adjusted 'XX include October the million. $XXX percent and to amortization $X.X ended currently of $X.XX EBITDA million from revenue total which to expectations million. QX decreases million and EPS diluted Other depreciation to revenues the adjusted range million share from of $X.XX XXXX, for to non-GAAP from we to Going $XXX $XX.X $XX.X contract expect result.

interest $X.X notes. from settlement Share-based our the for approximately compensation Adjusted million million. included The expected to $X.X million million. before $X expected $X.X to expense interest based in rate to effective on of the any excluding tax tax at million, net, to awards. million of effects $X.X discount G&A of amortization of of XX.X% is Other $X.X million non-cash share $X.X debt income, is range

storm of quarter going slide last January The Now included million services. of year to fiscal $XX.X XX. restoration

For that $XXX.X comparative million. were revenues non-GAAP purposes, organic quarter

growth QX expect January million XXXX to revenue a And from to in to to in organic ranging increase single-digit revenues adjusted currently ahead from Looking contract percentage organic line 'XX. EBITDA non-GAAP the line we of margin compared 'XX. non-GAAP in QX the of percent expect revenue $XXX.X ranging we quarter, low slight from

back will I Now to turn the Steve. call

Steven Nielsen

Drew. Thanks,

environment slide to on strengths. the Moving strong our and experienced we significant Within XX. effects capitalized a of a growing industry economy,

and First throughout strong customer maintained foremost, our markets. we presence

has industry presence us at market to forefront the extensive our allowed opportunities. evolving of Second, be

support in of cells. of wireless of technologies the Wireless enabling remain deployment the regions new these opportunities activity enhanced and new firm cells and through in and country. strengthening. begun has expanded macro of coverage capacity to end-market drivers are construction The Fiber underway deployments are many accelerate small

underway. the medium these businesses connections. of in X share deep Customers are creating companies small sales to to and our are deploying provisioned of to operations consumer increasing are as anticipation opportunities well operators Telephone maintenance high-speed capacity for and consolidating the Dramatically build growth is Portion data business. gigabit are to new home fiber market speeds expand and deploying process. deployments Fiber being enable usage and and value deployments growing. long-term as fiber are are enterprises. increased to customer supply Cable of opportunities consumers chains,

wireless/wireline capital confident our team the strategies, planning, and prospects employees as design, in for encouraged major we management experience customers and that committed procurement are multi-year and we In the services our integrated our We grow initiatives increasingly to engineering remain the addition, maintenance our spending and dedicated are we of and wired for construction providing converged and our networks. are business. company, capabilities of our

the Now operator, for questions. call open will we

Operator

Instructions] Markets. go from with ahead. of our comes line [Operator the Sean KeyBanc Eastman And question first Please Capital

Sean Eastman

great Hi, low-single stronger a questions. growth that have But fiscal at is a commentary It's guys Relative the for near-term trajectory demand. the for fourth quarter, guess seems It see kind there the digit up the here. indicate to market to revenue on of on qualitative growth. flat you firstly horizon on here. my I outlook looking Thanks team. me. taking to handle to

just to I'm how this here. in point? is So would growth of at inflection point a re-acceleration visibility call guys Has you on of wondering kind improved do still it or characterize that tough kind

Steven Nielsen

Sean, quarter. I think the fourth specifically So, to

As Christmas the that that's well five four always, and as and unpredictable quarter between that weather. as New Year week has holidays or

one not so important near is always all and term relative And the trends that control. understand there going to so outside think that on intermediate I much that's to businesses just

in progress of I revenue growth. quarter this think look, we had good organic terms

We have their in will one customers customer parts they're fiber opportunities other that those there, only their optimistic completed is the of on regulatory commitment yet the committed there regulatory -- business. and but happy we're deployment, not be with -- but who

better to think I ahead So looking times. are we

Sean Eastman

the of thinking wondering we're we some margins making it there in Okay, the extrapolate the fiscal take a thanks. about perspective correctly the in just kind second example, contract second getting other For the beyond to considerations quarter improving margin for I note where modification, quarter, fiscal as have that of? comparable in term look potentially next about longer this to year. up relates should to quarters at and slightly of just we are into to point here a the I'm of kind sure quarter fourth of And that that can year-over-year or stabilized from and when margins terms flat

Steven Nielsen

Yeah.

again the quarters. line in on and program if about we've margins large the how is we've not were said We a excluded quarter, that couple had. past, ever that talked in executed the we can we customer of effects and last year you last think what So talked with that of about that best our say we in I program margins

is some quarter on amount -- okay, tough given that of increased in to that But the It's I think quarter evaluate fourth against again provide still and there much or daylight But anybody does forward. the is term modification then those at plenty near-term that work And -- trend. once weather of look intermediate going for to holiday that's revenue trends just program. then and appreciated. do a to

Sean Eastman

I Okay. it will right. All Thanks, Steve. turn over.

Steven Nielsen

Sean. Thanks,

Operator

Thalhimer next comes our Davis. And ahead. line from the you. question with go Thank of Thompson Please Adam

Adam Thalhimer

guys. Hey, good morning,

Steven Nielsen

Good Adam. morning,

Adam Thalhimer

revenue Hey, that Steve, large on are you program? yet peak

Steven Nielsen

we the So Adam, the comfortable is we're business. last quarter we growth don't programs, opportunities were asked comment plenty but on and, entirety of that question of across that individual there

Adam Thalhimer

the And made a that? that? Okay. note there? of you're five. seeing all Can nice What's additional finally customers, that you give some other outside you growth is driving color your some How sustainable top

Steven Nielsen

So if we fiber looked had And electric in of are the smaller our typically co-ops. customers, for said talked about fiber, at active. expand past deploy those all they into more aggregated top emerging networks. they're because together, we've this five seeing a their their very and primarily trend only fiber entities, we're we across on to rural And those not calls footprints deployments, actually but deeper

would sixth has It seventh customer our been and grown probably or quarters. quickly to the four have last five over very

think business. the I that that's of part good the a portion growth of So in

time see pleased ILEC TDS a both fiber that been pretty aggressively they're has were to indicated also who deploying has their outside. customer We inside who and footprint long

seeing only some see interesting that was auction, and not inside the outside we're outside. from both their but more franchise on footprint them, to Windstream opportunities bought millimeter in actually spectrum wave last So of

others. even from some more So and franchises folks opportunities those outside I think customer we traditional their see fiber

Adam Thalhimer

from in just general? Okay. one decline for the what's And year. me the your in last a cable the What cable the obviously big the business, first on side half revenue of back in of thought half then --

Steven Nielsen

were had our construction investments. on of to planned spending customers scalable extensions their part due we the down of and So that and line infrastructure in that call on specifically they're timing one other spoke

right And in the see are they to the change growth so May, we kind third think -- you continuing now think of where consumption. view. I I it in where consumer change we But saw pretty in quarter look if explains really the at data kind that compared slight they dramatic of in

report, to ago. now pretty four yesterday per a just for of was is XXX years one broadband average or have. It's There stunning an that gigabytes number they customers seeing of month consumption of compared three every our years subscriber

little a it's while So year. bit slower this

well year next been street. We better that's think to on I look the year. understood forward

Adam Thalhimer

Understood.

Thanks, it Okay. I'll Steve. over. turn

Operator

from Thank our go Davidson. you. And Please line next question D.A. comes the of Brent Thielman with ahead.

Brent Thielman

Hey, thanks, morning. good

Steven Nielsen

morning, Good Brent.

Brent Thielman

DSOs, do in we with starts to Steve, and plateau increase the some of large When normalization this cash understand is see program. this that kind conversion? and think associated I you

Steven Nielsen

work. us in has the normalization adding I modifications see year. working fiscal mean completed we're opportunities been some we'll think at through I of invoice end it. There hard more terms timely been this of offered. That for some have to

talked we've get So quarters. as better couple for at working that. hard we're And we're about last to of hard working the

Brent Thielman

business Windstream I seeing was last through I coming up And picked you're if guess post just curious it year. that's like petition, from payments helpful. Okay, looks with then that.

Steven Nielsen

broadband are in, to are had subscriber subscribers as Yeah. good we only but quarter, deploying paying quite in year. business, Their not expect they that restructuring and the are grow they they are good fiber also but more encouraged not their only investing payments a well, are undergoing for

looking So we're ahead. encouraged are and we encouraged currently,

Brent Thielman

individual those slide of -- as in your of this, you again more have of look my and Are multiple negotiations growing Okay. kind with customers in capacity the I value, to the the head you large are just is the brings is, scale. at of awards, look presentation states. that some about footprint collective terms markets And those in if kind those the the you -- is are national awards this where customers these at think these within individual count, you awards just to of in terms and of and for about last contract with to trying Dycom question, Steve thinking kind

Steven Nielsen

the the contracts the typically years XX of sizes sometimes grown some of regionally the XX all contract still, for are of last state, over through have Well, Typically state. time geographically. the entirety described the half or

So their have as customers organizations. simplified administrative

larger gone They've territories. with

little or re-estimate have long-term are typically of regions in but that off discussions as a but as backlog. year, they're balance backlog. comprehensive in year But is quarter work of the the for customers the of with states, bit to we individual growth how we through backlog higher revenue individual bit renewals So was a kind and where we this through of year burned in we be little feel our the current expect next and and a a terms flow contract down a good renewal mostly it

Brent Thielman

Appreciate color. Okay. you. Thank the

Operator

next And you. go our with Please of Alex B. comes line Thank Rygiel from question the Riley. ahead.

Alex Rygiel

Good morning, Tim. Steve, Drew and

Steven Nielsen

Alex. Hey,

Alex Rygiel

help value capital could you quantify six months? the Drew, out working over Hey, next and opportunity could you the receivables to pull of that us dollar possibly

Steven Nielsen

Alex, Drew, about this. I'll hard this. jump we normalize I to mean, in I've working here. I talked and are mean,

and If at slightly. this it's year-over-year looked excluded you program, just DSO up

So performance. line the the base the of the revenue rest in rest of with and past customer is

It's figure get the entire You the It's where complex how drive would back on could going it on you, be ourselves release to DSO to is careful, we've and so that, of quarters of is working assure do last but cash we're to out couple from the as can project. talked as the to ahead about that we I much company a probably math big normal. program.

Alex Rygiel

And been quarter fourth guidance. talk some there about has then

down Anything it's from like guidance, called quarter out somewhat relates guidance. it As particular that's previous looks in to third the there? revenue it your

Steven Nielsen

MSOs difference to that -- in plant said way a their we modulations little in that of question the timing customer. in network in May we particular question, earlier that that construction was plans one timing real the way bit investing we really one of a is of in being that and have And just slower cited and substantial an the spending just Yeah. is due these if you on the has on and their we saw that's Alex, customer a and part to as strategic. once while see look a there them things now. There's every identify with is

Alex Rygiel

key to large about the number relates margins the relative customer the thing about certain complexity level? of normalized the of gross your over amount today how of it as last we And program, contract commentary more quarters in to should the think

Steven Nielsen

And margin. Alex, gross but the that same also with comment made EBITDA, respect would it's we before to apply to

If the we've performance. the But reasonably with ever the in program pull rest certainly that best not you prior is of It's line performing this out, business well. done.

work complexity program, on prior So hard said as priorities. quarters objectives, there from is that we arising the pointed we as And this in to processes and evolving opportunity. we've

the objectives evolutions. on associated have cost we're processes lots work we're spending I and settled. the think of attention out the and more time with to still pull those to the do priorities and on We

Alex Rygiel

helpful, you. thank Very

Operator

you. from Thank Dillard And our ahead. next Bank. question Deutsche comes go with Chad Please

Chad Dillard

morning, good guys. Hi,

Steven Nielsen

Good Chad. morning,

Chad Dillard

how that? increase a look about Should like I sign the lay I since XXXX. a think the ramp plateau marked labor as slowest, like sequential should July back, quarter looks in if So the that reached or we has take we that it labor mean

Steven Nielsen

always, I right. Chad, as Well, think,

and headcount before, was of revenue so subcontractors loosely of said construction our to for we've kind correlated. we As activity, utilized portions

if it, revenue than year-over-year million a sequentially about we grew percentage million we $XX at head at essentially greater $XX and increase headcount So in slight a on you count. grew think

forward, We a resources business, it than mix hope more construction, as subcontractor the and headcount think will grow. opportunities I I construction we continues get into more So headcount. different heavily additional going of rather think see grow. will we we but see grow business to get as more to We into utilized we see

Chad Dillard

greater you based start continue you when you're what part X, going seeing seeing do do more then tipping that, it of just a on construction see Any mean on backlog on to you I I pertains backlog, growth seeing mean point very would you Got evolve, you. your I see of can And that accelerate? bit your X. side, a as And mix helpful? little are on business, part what to where is kind forward to mean you're color be the give color wireless

Steven Nielsen

total, in $XX short we of was revenue the the quarter, number which if So in it million largest at ever we've wireless look is just of had.

million $XXX run So kind of a rate.

So business in growth with both digits. sequentially grew the double year-over-year and we're pleased that

was that helpful. -- So that was

to have that of pleased actual in I to one have with radios XG four power deployments large for week. acquisition, eight We're we've XXX the opportunities next that just think waiting short backhauled just business. in market, to site see we we beginning done sites, have come we're in just metropolitan to and and gotten

and we're to beginning So actually opportunity revenue driven by see XG.

Chad Dillard

And just one question. more

control is mitigate some so about just actually but, you what you pull can the one several the that that margins and And guess you realize here? on but ramp resulted and customer that that is going back can't I So, can, probably lower that there realize some you do margin for been to talk I has that's that like and I levers can, have impact quarters of in part complexity you now. there

Steven Nielsen

Yeah.

And So, the and and Chad it's last really right. around not incrementally discussed as least the at quarter, as previously, we've priorities. versus objectives processes the

And so we we as we've processes, before, about talked the as at it look systems. implement

to it what First, get to, resources we of ahead with of get we have ahead it.

on systems complexity having and implement a we're working out the take both to capital program, build with that large and working we \Then do once, we're reversing cost at that growing to also. it's associated so and

detailed project I sharing there's it, comfortable what we're of pretty working to that's more It's love plan, think into but we'd teams detail. So on go lots a today.

Chad Dillard

thanks. Great,

queue. back in hop I'll So

Operator

next from Jennifer Fargo. question Wells of Fritzsche comes the Thank go with ahead. you. Please line And our

Jennifer Fritzsche

the taking electric you for the co-ops thank you customer in A aggregate. Steve, becoming larger Great, few, mentioned may. question. if a I

June was to is of access the comment main just -- kind XG. conference part tricky Is and in And that the how helping just of you power lack that one our XG then I you're that. theme have there? a that? of after with follow-up what One that Can of from on

Steven Nielsen

Jennifer, powering and all hundreds clearly XG with of if thousands, cells is millions of clearly associated an of So small not the densification of issue.

so figure I And end I actually out, said, refer starting America fiber from these on at the now as where it sites is there does. networks, so often with we're actually incumbent and home actually least an to some year. think rural cable not the to are will the we of building co-ops, industrial in on facilities service, bring telco. between XG their often the co-ops service only are dial-up the What to these it's... And air own

Jennifer Fritzsche

it. Got

Steven Nielsen

literally, the there'll it's million active digital XX rural the that are that own have co-ops with across But expect the the like is, I only doing there's from have the electric opportunity seen in by I served their country. meters be funds. That's that FCC. So And number not fund. offer rural think we and been something -- these they this upcoming

Jennifer Fritzsche

little is bit? Can most to can that Or with if nice growth -- the it. -- happened if happen, then we I were with yet. CenturyLink, about consumer a they down side? the there business. that that had you've of hole, an that they've advisor consumer has you a CenturyLink. announced of may, sell And you Nothing has relationship went Got talk just publicly CenturyLink if had But about to acceleration their rabbit hired

Steven Nielsen

are seeing effort on we're in to traditional for that anything guess, hard and to fiber that ILEC it's comment outside I but business. that they the we're what has aggressively a business, growing opportunities the customer. only do focused by that that us on ILEC seeing is So fiber, the strategic they not of footprint are with

and to they to not than on As their everybody focus facilities facilities. else rather leased service own continues getting

think and seeing beyond the business access always seen hard, of pleased I working can been to parts we're the consumer. with do We're better. think we've we've broad I So opportunities broader but we

Jennifer Fritzsche

much. very you Thank Perfect.

Operator

comes line And from you. Please next the with of question go Hirschman Thank Blake ahead. Inc. our Stephens

Blake Hirschman

Yeah. Good for my taking morning, guys. questions. Thanks

customer of As potential these through? are are to more with deal a follow-up going one-time an the the benefit ongoing come flowing that benefits of this already or forward the large modifications, a on contract further program, for with is end kind conversations that's

Steven Nielsen

lots Blake, retrospectively, has we have in appreciative do, think, I of our work -- clear of we just and So forward, comments, the we're both this both increase benefit. it future and be appreciate benefit it. to as past going to But said revenue still a

Beyond that, comment with going our not discussions on to we're our customers.

as the best prove we think we're still numbers. in show last our program, on we program. large and way is hard I as improve perspective this business the And on that's it customer working to said to quarter, it the the

Blake Hirschman

benefit it. fiscal the has that XQ Got guide -- was and That's situation into And the for XQ with there? been incorporated the that guidance

Steven Nielsen

number current to period appreciated retrospective would needed basis, a we provide you forward. in that it understand we certainly going helpful It's again, and once performance. a to it. was outlook incorporated the as -- It's On Yeah. it's folks

Blake Hirschman

the expected kind it fiber guys into home in cadence what of impact to was then the quarter above build-out thinking? And and down AT&T's it. that you fiber over what coming or you or of magnitude summer Got on did winded in spend the AT&T line the with it you that were

Steven Nielsen

No, completely they uptake continue good We're we're that they I line service the to And with commentary see think by their of thinking. what in into it sell footprint. was their that prior encouraged is as just in really timing we've effect, to in answer real in MSO on going around questions invest past the forward. The about continuing comments said planned fiber the this to side. as

Blake Hirschman

to there it too much Is for come the come the down. lastly didn't anything the Got as down on why down? it it. year, did far came as And there range CapEx, then to but point

Steven Nielsen

got mean to we're being work disciplined, Blake. I do. We

and going hurting said, in levers line Company on I appropriate without we're to the focused in these As manage business as other the the DSOs is business. getting the

what I the without make we've so adjustments do that think we're that doing. as we plan, always had that's we disciplined done need so capital business hurting can we've it if a to and

Blake Hirschman

All right. I'll turn over. Makes a Thanks sense. lot. it

Operator

Thank you.

from comes line Stifel. with question Dilts next ahead. go of Noelle Our Please the

Noelle Dilts

guys. Thanks, morning. Good

Steven Nielsen

Noelle. Good morning,

Noelle Dilts

just can on retrospective remind the can covered? the us And contract quick you another tell exact amendment, So, question us change time the period this you concludes? contract when that just of

Steven Nielsen

So things Noelle. two

the So $X.X understand and period quarters. bit it that the, roughly that but years, million call fiscal a current first current kind the back quarter, little the you pay that's those in over there is the of if to in If helps goes each of in just year prior a just impact.

of program, to work work there plenty As opportunities. continue there be to with, and the we continue through to do we work other may is on it

the And into going be do not the a jobs, contract. time. for of so if we hopefully our we'll to actual Because, end long we're get there

Noelle Dilts

second, to Okay, heard had some small we've that deployments taking maybe cell folks understood. know a the expected. are industry bit just move than from longer in And other you forward folks

could associated how things of small thinking talked that deployment how today? of you're Any a the us with cadence cells about, challenges, around citing you've doing And work you you're moving engineering about give Some of forward? chance that etc. sense much

Steven Nielsen

as of with of number over out next it's customers -- probably we or significant it's a a two we piece small this growing, have do that business at years. we point. the three But So the cell not look activity

increasing millimeter the properties an at will have those got I of lots wireless of frequencies, particularly spectrum spending, think be to propagation it antennas everybody's given of proportion bands. you've because wave

XX, better going the Noelle, would conversation today ago technology usually look, lots sites. always if something the clarity to about country. starting is that's problem And have The it's about press occurred look of to lots how what is industry they any technology deployed time I years at value. it start on figure going and up. talking think And value of how to different XX don't being a provide difficulties for we get popular and macro the we'll see a get going to some when citing I than as around it's get provide a So the out

Noelle Dilts

you any other round chance, customers Okay, top thanks. finally, And and utility and other? could Drew, out

Drew DeFerrari

in XX.X%, customers XX.X%, the where XX. was the got and point Noelle, everyone Sure. electrical X.X%. at cable top call then at top at us slide the and I'd for was X locating end on And facility following was was telco split, on to X.X% the we've And other that other

Noelle Dilts

Thanks.

Operator

And the go you. comes Capital our Please from with Thank Christian of Schwab question ahead. line Group. next Craig-Hallum

Christian Schwab

guys. customer my the just work Thanks we question. taking confirm future. your more want morning, I the to contract good with in large and modifications modification that Hey, Steve, complete expect no for should is

Steven Nielsen

to nothing to had that increased program what a said a we in revenue going is What we'll work continue have we was modification a that benefit an There Christian. retrospective said is, program. as piece there that that's because through forward benefit we of confirm, and not

Christian Schwab

Okay.

trends. Another question large way historical with along or the excess margins program, same lines stated of customer whether the We line in talked about possibly gross being rest then, EBITDA margins. the different it's business

future based contract So about to -- to more we heavily return that want think control be just want to margins, on or as and plus think to of opportunity is but there? it's if get -- just want whichever modifications processes better to opportunity costs your an if that opportunity discuss you would we gross XX%

Steven Nielsen

to outline discussions of having way we're around not kind topics. we're going Christian, those the with any think, I customer

performance The than months the three was settled of appreciative improve to ago. this underway do. got are it today that. is there efforts of lots a to work on is number is lots there of We're to making by do. still encouraged We're We contract program But our and modification. We've more progress.

Christian Schwab

to to along business? to One rest lines, And the death. process same aggregate it last can return if right. beat that by of All question in we better return historical profile, your the control margin can I customer

Steven Nielsen

and we We one to effort our and invested because we've on dimension, return working business need that a accepted we're because to is as that back characterize it acceptable, investors a and particular not where it working hard broadly, the or We've are lot. the we earn to get working today hard hard profile. we're that, to it. So, to wouldn't on change isn't I are for

Christian Schwab

other Thank you. questions. No Great.

Operator

ahead. And have Please you. Jennifer Thank the Fargo. Fritzsche of we from line follow-up with go question Wells a

Jennifer Fritzsche

some money think Great, come I fund, customer on whole, be opportunity our -- just that rural as terms, but has I One, to these I job, hear of is that the which focus world is of confirm, the thank up, customer been change to know you. development of and through with wanted I going think the didn't it's one going this providers. I amount in substantial area called a this larger

still Any you do that thoughts about How in view customer talked the that? about it's initial time I I remember think I know topside we when one mean, there. I process. talked in CAFII, you becoming, aggregate. at

Steven Nielsen

Well, couple of Jennifer. I things, a think

from a a customers. billion year, over was an So it's one for at little increase CAFII where our $X

a broadens participate. be other electric there may as highlighted co-ops the our some opportunity good So thing from it's set, because may non-traditional to of able be co-ops, perspective. these clearly It we participants

with shows how of is, actually that -- customers the 'XX this their did And systems. program for movement fiber the strong a federal where remainders what's XXXX, to come and this do, back and in instances seen actually work through more recently, limited in 'XX stimulus funded through America, back have and we've rural number we the rural interesting just work to of

homes think I don't of I spectrum, in also think particularly wave from hurting. some $X in not well and their the million and see this strong as just ILEC then as millimeter a just fiber, adjacent. that about as any only So comments, it's we in but trend very deployment Windstream way

the helps business. it think I

Jennifer Fritzsche

I'm sorry, Steve.

saw CAFII. a this faster this what than said crack we earlier, from but require speed You does

Steven Nielsen

rule interesting X Yeah, the so not XX one up. is But of comment. and the megabits is final, megabit out required it's now down CAFII for things

megabits on As megabit understand XX it, it's X up. down, but now I centering

with just a a is fairly are even extent sliding and bandwidth go government a it's to down you auction speeds actually you -- proposed XX it's the and is that heavily willing the that up. -- higher weighted read, but X Although up more then there a X quick fairly through on to gig, as you the prioritize scale to complicated process, higher clearly

Steven Nielsen

of questions. call, appreciate everybody's next look Thank no week the we We forward attention time and in if have Operator, more seeing Okay. the on you. we you the Thanksgiving. on to and call

Operator

much and may very for you conference that disconnect. your you. conclude for now you Ladies participation, does today. Thank Thank your gentlemen,

Dycom Industries (DY) 28 Aug 192020 Q2 Earnings call transcript