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Macquarie's (MIC) Q1 Earnings Decline Y/Y, Revenues Rise

Zacks Equity Research

Macquarie Infrastructure Company MIC reported diluted income per share of 79 cents in first-quarter 2019. Notably, the figure was lower than 91 cents per share reported in the year-ago quarter. Notably, high selling, general and administrative and depreciation costs and rise in interest expenses were primarily responsible for the year-over-year decline.

Macquarie generated revenues of $482 million, up 3.2% year over year.  The top line was driven by solid operational growth in the Atlantic Aviation segment. Product revenues were flat year over year while Service revenues jumped 3.7%. However, revenues missed the Zacks Consensus Estimate of $488 million.

Macquarie Infrastructure Company Price, Consensus and EPS Surprise

Macquarie Infrastructure Company Price, Consensus and EPS Surprise | Macquarie Infrastructure Company Quote

Segment Details

Revenues from the International-Matex Tank Terminals (IMTT) segment came in at $161 million, up 16% year over year. It represented 33.3% of the company’s first-quarter revenues. The segment’s EBITDA improved 33% to $104 million.

The Atlantic Aviation segment generated revenues of $258 million, up 4% year over year and accounted for 53.4% of the company’s overall revenues. The segment’s EBITDA rose 13% to $79 million.

Revenues in the MIC Hawaii segment were flat year over year at $64 million. It represented 13.3% of overall quarterly revenues. The segment’s EBITDA increased 25%.

Operating Costs

In the reported quarter, Macquarie’s cost of services and cost of product sales decreased 10.2% and 17% year over year, respectively.

Selling and administrative expenses were flat year over year at $80 million. Overall, operating expenses declined 8% to about $359 million.

Liquidity & Cash Flow

As of Mar 31, 2019, the company had cash and cash equivalents of $603 million and long-term debt of about $2,653 million. Its adjusted free cash flow for the quarter rose 20% year over year to $165 million.

Macquarie authorized cash dividend of $1.00 per share for the first quarter, payable May 16 to shareholders of record as on May 13.

Guidance

The company expects 2019 EBITDA in the range of $610-$635 million. It also expects to generate free cash flow in the band of $400-$445 million.

Zacks Rank & Stocks to Consider

Macquarie currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks in the space are iRobot Corporation IRBT, Cintas Corporation CTAS and Actuant Corporation ATU. While iRobot sports a Zacks Rank #1 (Strong Buy), Cintas and Actuant carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

iRobot exceeded estimates in each of the trailing four quarters, the average beat being 94.52%.

Cintas surpassed estimates in each of the trailing four quarters, the average beat being 6.09%.

Actuant surpassed estimates in each of the trailing four quarters, the average beat being 11.01%.

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