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NV5 Announces Record Second Quarter Results; Exceeds Analyst Consensus and Raises Full-Year 2021 Guidance

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HOLLYWOOD, Fla., Aug. 10, 2021 (GLOBE NEWSWIRE) -- NV5 Global, Inc. (Nasdaq: NVEE) ("NV5" or the "Company"), a provider of compliance, technology, and engineering consulting solutions, today reported financial results for the second quarter ended July 3, 2021.

"NV5’s record performance in the second quarter, led by our strategy, business model, and ability to adapt to market conditions, resulted in the highest gross revenues, net income, adjusted EBITDA, and adjusted EPS that NV5 has delivered in a quarter since inception," said Dickerson Wright, PE, Chairman and CEO of NV5. Wright added, "Public sector investments in infrastructure and utility safety and reliability continue to drive growth across our service verticals. The strong performance of our real estate transactions, energy efficiency, and international businesses demonstrates the ongoing recovery of our businesses that were impacted by the COVID pandemic. We strengthened our Environmental Health Sciences (EHS) vertical with the acquisition of PES Environmental in May. Environmental, social, and governance (ESG) continue to be increasing drivers of our business with the EHS vertical growing 71% year-over-year in Q2 supported by the organic growth of our real estate transactions business. We expect to build upon our strong second quarter momentum and are raising our guidance on gross revenues, GAAP EPS and adjusted EPS for the full year 2021."

Second Quarter 2021 Results

  • Gross revenues in the second quarter of 2021 were $179.5 million compared to $162.7 million in the second quarter of 2020, a 10% increase.

  • Net income in the second quarter of 2021 was $13.6 million compared to $4.5 million in the second quarter of 2020, a 203% increase.

  • Adjusted EBITDA in the second quarter of 2021 was $34.2 million compared to $26.9 million in the second quarter of 2020, a 27% increase.

  • GAAP EPS in the second quarter of 2021 was $0.91 per share compared to $0.36 per share in the second quarter of 2020, a 153% increase.

  • Adjusted EPS in the second quarter of 2021 was $1.34 per share compared to $0.93 per share in the second quarter of 2020, a 44% increase. Diluted weighted average shares were 14,965,188 in the second quarter of 2021 compared to 12,609,918 in the second quarter of 2020.

  • Full year 2021 guidance as follows:

    • Increase gross revenues to a range of $705 million to $727 million (previously $695 million to $720 million).

    • Increase GAAP EPS to a range of $2.45 per share to $2.84 per share (previously $2.36 per share to $2.78 per share).

    • Increase Adjusted EPS to a range of $4.20 per share to $4.55 per share (previously $4.05 per share to $4.45 per share).

Six Months Ended July 3, 2021 Results

  • Gross revenues in the first half of 2021 were $332.6 million compared to $328.2 million in the first half of 2020.

  • Cash flows from operations in the first half of 2021 were $62.2 million compared to $50.7 million in the first half of 2020, a 23% increase.

  • Net income in the first half of 2021 was $19.1 million compared to $8.7 million in the first half of 2020, a 120% increase.

  • Adjusted EBITDA in the first half of 2021 was $58.5 million compared to $51.1 million in the first half of 2020, a 14% increase.

  • GAAP EPS in the first half of 2021 was $1.35 per share compared to $0.69 per share in the first half of 2020, a 96% increase.

  • Adjusted EPS in the first half of 2021 was $2.25 per share compared to $1.77 per share in the first half of 2020, a 27% increase. Diluted weighted average shares were 14,196,035 for the six months ended July 3, 2021 compared to 12,601,830 in the six months ended June 27, 2020.

Use of Non-GAAP Financial Measures; Comparability of Certain Measures

Earnings before interest, taxes, depreciation, and amortization (“EBITDA”) is not a measure of financial performance under GAAP. Adjusted EBITDA reflects adjustments to EBITDA to eliminate stock-based compensation expense and acquisition-related costs. Management believes adjusted EBITDA, in addition to operating profit, Net Income, and other GAAP measures, is a useful indicator of our financial and operating performance and our ability to generate cash flows from operations that are available for taxes, capital expenditures, and debt service. A reconciliation of Net Income, as reported in accordance with GAAP, to adjusted EBITDA is provided at the end of this news release.

Adjusted earnings per diluted share (“Adjusted EPS”) is not a measure of financial performance under GAAP. Adjusted EPS reflects adjustments to reported diluted earnings per share (“GAAP EPS”) to eliminate amortization expense of intangible assets from acquisitions, net of tax benefits, and acquisition-related costs. As we continue our acquisition strategy, the growth in Adjusted EPS may increase at a greater rate than GAAP EPS. A reconciliation of GAAP EPS to Adjusted EPS is provided at the end of this news release.

Our definition of Adjusted EBITDA and Adjusted EPS may differ from other companies reporting similarly named measures. These measures should be considered in addition to, and not as a substitute for, or superior to, other measures of financial performance prepared in accordance with GAAP, such as Net Income, and Diluted Earnings per Share.

Conference Call

NV5 will host a conference call to discuss its second quarter 2021 financial results at 4:30 p.m. (Eastern Time) on August 10, 2021. The accompanying presentation for the call is available by visiting http://ir.nv5.com.

Date:

Tuesday, August 10, 2021

Time:

4:30 p.m. Eastern

Toll-free dial-in number:

+1 833-900-1538

International dial-in number:

+1 236-712-2278

Conference ID:

6988609

Webcast:

http://ir.nv5.com

Please dial-in at least 5-10 minutes prior to the start time to allow the operator to log your name and connect you to the conference.


The conference call will be webcast live and available for replay via the “Investors” section of the NV5 website.

About NV5

NV5 Global, Inc. (NASDAQ: NVEE) is a provider of compliance, technology, engineering, and environmental consulting solutions for public and private sector clients supporting sustainable infrastructure, utility, and building assets and systems. The Company focuses on multiple verticals: testing, inspection & consulting, infrastructure engineering, utility services, buildings & program management, environmental health sciences, and geospatial technology services to deliver innovative, sustainable solutions to complex issues and improve lives in our communities. NV5 operates out of more than 100 offices nationwide and internationally. For additional information, please visit the Company’s website at www.NV5.com. Also visit the Company on LinkedIn, Twitter, Facebook, and Instagram.

Forward-Looking Statements

This news release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. The Company cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward-looking statements contained in this news release and on the conference call. Such factors include: (a) changes in demand from the local and state government and private clients that we serve; (b) general economic conditions, nationally and globally, and their effect on the market for our services; (c) competitive pressures and trends in our industry and our ability to successfully compete with our competitors; (d) changes in laws, regulations, or policies; and (e) the “Risk Factors” set forth in the Company’s most recent SEC filings. All forward-looking statements are based on information available to the Company on the date hereof, and the Company assumes no obligation to update such statements, except as required by law.

Investor Relations Contact

NV5 Global, Inc.
Jack Cochran
Vice President, Marketing & Investor Relations
Tel: +1-954-637-8048
Email: ir@nv5.com

Source: NV5 Global, Inc.


NV5 GLOBAL, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(in thousands, except share data)

July 3, 2021

January 2, 2021

Assets

Current assets:

Cash and cash equivalents

$

113,023

$

64,909

Billed receivables, net

109,122

142,705

Unbilled receivables, net

83,586

74,458

Prepaid expenses and other current assets

11,013

6,804

Total current assets

316,744

288,876

Property and equipment, net

29,444

27,011

Right-of-use lease assets, net

44,196

43,607

Intangible assets, net

175,093

174,931

Goodwill

364,562

343,796

Other assets

3,364

2,954

Total Assets

$

933,403

$

881,175

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable

$

38,446

$

39,989

Accrued liabilities

47,319

45,325

Billings in excess of costs and estimated earnings on uncompleted contracts

16,805

24,962

Client deposits

706

380

Current portion of contingent consideration

3,933

1,334

Current portion of notes payable and other obligations

26,989

24,196

Total current liabilities

134,198

136,186

Contingent consideration, less current portion

1,374

1,066

Other long-term liabilities

39,762

38,737

Notes payable and other obligations, less current portion

142,347

283,326

Deferred income tax liabilities, net

29,736

27,791

Total liabilities

347,417

487,106

Commitments and contingencies

Stockholders’ equity:

Preferred stock, $0.01 par value; 5,000,000 shares authorized, no shares issued and outstanding

Common stock, $0.01 par value; 45,000,000 shares authorized, 15,365,382 and 13,270,131 shares issued and outstanding as of July 3, 2021 and January 2, 2021, respectively

154

133

Additional paid-in capital

441,049

268,271

Retained earnings

144,783

125,665

Total stockholders’ equity

585,986

394,069

Total liabilities and stockholders’ equity

$

933,403

$

881,175


NV5 GLOBAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF NET INCOME AND COMPREHENSIVE INCOME
(UNAUDITED)
(in thousands, except share data)

Three Months Ended

Six Months Ended

July 3, 2021

June 27, 2020

July 3, 2021

June 27, 2020

Gross revenues

$

179,503

$

162,689

$

332,598

$

328,169

Direct costs:

Salaries and wages

45,025

45,079

86,485

90,114

Sub-consultant services

29,978

25,244

53,225

52,670

Other direct costs

13,114

8,914

22,912

17,402

Total direct costs

88,117

79,237

162,622

160,186

Gross profit

91,386

83,452

169,976

167,983

Operating expenses:

Salaries and wages, payroll taxes and benefits

44,213

44,149

87,164

89,706

General and administrative

13,367

11,824

24,915

24,980

Facilities and facilities related

5,038

5,357

10,135

10,754

Depreciation and amortization

10,216

11,160

19,656

22,200

Total operating expenses

72,834

72,490

141,870

147,640

Income from operations

18,552

10,962

28,106

20,343

Interest expense

(1,568

)

(4,403

)

(3,886

)

(8,190

)

Income before income tax expense

16,984

6,559

24,220

12,153

Income tax expense

(3,346

)

(2,056

)

(5,102

)

(3,462

)

Net income and comprehensive income

$

13,638

$

4,503

$

19,118

$

8,691

Earnings per share:

Basic

$

0.95

$

0.37

$

1.40

$

0.71

Diluted

$

0.91

$

0.36

$

1.35

$

0.69

Weighted average common shares outstanding:

Basic

14,419,671

12,308,965

13,648,247

12,271,221

Diluted

14,965,188

12,609,918

14,196,035

12,601,830


NV5 GLOBAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands)

Six Months Ended

July 3, 2021

June 27, 2020

Cash flows from operating activities:

Net income

$

19,118

$

8,691

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and amortization

21,936

23,277

Non-cash lease expense

4,884

4,307

Provision for doubtful accounts

583

1,690

Stock-based compensation

7,790

6,880

Change in fair value of contingent consideration

235

Gain on disposals of property and equipment

(581

)

(350

)

Deferred income taxes

(2,988

)

(869

)

Amortization of debt issuance costs

454

442

Changes in operating assets and liabilities, net of impact of acquisitions:

Billed receivables

36,727

(1,134

)

Unbilled receivables

(7,238

)

(2,286

)

Prepaid expenses and other assets

(4,208

)

2,117

Accounts payable

(2,446

)

138

Accrued liabilities

(4,187

)

1,922

Income taxes payable

613

Billings in excess of costs and estimated earnings on uncompleted contracts

(8,158

)

5,241

Deposits

307

66

Net cash provided by operating activities

62,228

50,745

Cash flows from investing activities:

Cash paid for acquisitions (net of cash received from acquisitions)

(21,652

)

Proceeds from sale of assets

460

437

Purchase of property and equipment

(4,028

)

(6,145

)

Net cash used in investing activities

(25,220

)

(5,708

)

Cash flows from financing activities:

Proceeds from common stock offering

172,500

Payments on notes payable

(5,325

)

(8,415

)

Payments of contingent consideration

(413

)

(913

)

Payments of borrowings from Senior Credit Facility

(145,082

)

(1,875

)

Payments of common stock offering costs

(10,522

)

Purchases of common stock tendered by employees to satisfy the required withholding taxes related to stock-based compensation

(52

)

Payments of debt issuance costs

(447

)

Net cash provided by (used in) financing activities

11,106

(11,650

)

Net increase in cash and cash equivalents

48,114

33,387

Cash and cash equivalents – beginning of period

64,909

31,825

Cash and cash equivalents – end of period

$

113,023

$

65,212


NV5 GLOBAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
TO COMPARABLE GAAP FINANCIAL MEASURES
(UNAUDITED)
(in thousands)

RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA

Three Months Ended

Six Months Ended

July 3, 2021

June 27, 2020

July 3, 2021

June 27, 2020

Net Income

$

13,638

$

4,503

$

19,118

$

8,691

Add:

Interest expense

1,568

4,403

3,886

8,190

Income tax expense

3,346

2,056

5,102

3,462

Depreciation and amortization

11,394

12,237

21,936

23,277

Stock-based compensation

4,094

3,501

7,790

6,880

Acquisition-related costs

180

231

629

571

Adjusted EBITDA

$

34,220

$

26,931

$

58,461

$

51,071

RECONCILIATION OF GAAP EPS TO ADJUSTED EPS

Three Months Ended

Six Months Ended

July 3, 2021

June 27, 2020

July 3, 2021

June 27, 2020

Net Income - per diluted share

$

0.91

$

0.36

$

1.35

$

0.69

Per diluted share adjustments:

Add:

Amortization expense of intangible assets and acquisition-related costs

0.58

0.77

1.21

1.46

Income tax expense

(0.15

)

(0.20

)

(0.31

)

(0.38

)

Adjusted EPS

$

1.34

$

0.93

$

2.25

$

1.77