HOLLYWOOD, Fla., Nov. 07, 2024 (GLOBE NEWSWIRE) -- NV5 Global, Inc. (Nasdaq GS: NVEE) ("NV5" or the "Company"), a provider of technology, conformity assessment, consulting solutions, and software applications, today reported preliminary unaudited record financial results for the third quarter ended September 28, 2024.
"NV5 delivered record results in the third quarter in gross revenues and Adjusted EBITDA1, as well as improved profit margins. These results were driven by strong organic growth throughout our operations, and we have now achieved our targeted annual revenue run rate of over $1 billion. NV5 enters the fourth quarter with tailwinds from both a record backlog and substantial industry investments for our services. We anticipate strong growth for the remainder of 2024 and entering the new year," said Dickerson Wright, Executive Chairman of NV5.
Preliminary Unaudited Third Quarter 2024 Results2
Gross revenues in the third quarter of 2024 grew 6% to $250.9 million from $237.5 million in the third quarter of 2023 and our gross profit increased 13% to $129.5 million. This represents a gross margin expansion of 350 basis points to 51.6%.
Net income in the third quarter of 2024 grew 31% to $17.1 million from $13.1 million in the third quarter of 2023. Net income includes $665k of higher interest expense this quarter as a result of higher debt balances, although our net leverage remains low at 1.3x. Our GAAP EPS in the third quarter of 2024 grew 29% to $0.27 per share from $0.21 per share in the third quarter of 2023. Cash flows from operating activities in the third quarter of 2024 grew 145% to $48.9 million from $19.9 million in the third quarter of 2023.
Our Adjusted EBITDA increased 21% to $44.5 million from $36.7 million, and our Adjusted EBITDA margin expanded to 17.7% from 15.4% in the prior year quarter. Our Adjusted EPS1 grew 22% to $0.44 per share compared to $0.36 per share in the third quarter of 2023.
Prior Periods
In the course of preparing the Company’s unaudited consolidated financial statements to be filed as part of Form 10-Q for the quarter ended September 28, 2024, the Company identified out of period project revenue associated with one customer acquired through its February 2023 acquisition of Continental Mapping Acquisition Corp. and its subsidiaries, including Axim Geospatial, LLC (collectively "Axim").
Prior periods presented in this press release have been revised as follows to correct the impact of the out of period revenue based on information currently available:
- For the three months ended September 30, 2023, gross revenues of $239.3 million were overstated by $1.7 million, net income of $13.3 million was overstated by $260k, Diluted GAAP EPS was not impacted, Adjusted EPS of $0.38 per share was overstated by $0.02, and Adjusted EBITDA of $37.8 million was overstated by $1.2 million.
- For the nine months ended September 30, 2023, gross revenues of $646.2 million were overstated by $3.9 million, net income of $34.7 million was overstated by $1.1 million, Diluted GAAP EPS of $0.56 per share was overstated by $0.02, Adjusted EPS of $0.92 per share was overstated by $0.04, and Adjusted EBITDA of $100.5 million was overstated by $3.5 million.
- For the six months ended June 29, 2024, gross revenues of $449.6 million were overstated by $5.8 million, net income of $8.3 million was overstated by $2.8 million, Diluted GAAP EPS of $0.13 per share was overstated by $0.04, Adjusted EPS of $0.48 per share was overstated by $0.06, and Adjusted EBITDA of $67.2 million was overstated by $4.6 million.
There was no impact on cash flows from operating activities in our previously issued Consolidated Statement of Cash Flows in any prior period.
1 Non-GAAP financial measures; see pages 2 and 7 for explanations.
2 Prior periods presented in this press release have been adjusted to correct for the misstatements described in the section above. Unaudited results are based on information currently available to the Company and could differ from the final amounts that the Company ultimately reports in its Quarterly Report on Form 10-Q for the fiscal quarter ended September 28, 2024. The Company assumes no obligation and does not intend to update these estimates prior to filing its Form 10-Q for the fiscal quarter ended September 28, 2024.
Updated Guidance for Full Year 2024
Gross revenues: $939 million to $943 million.
GAAP EPS: $0.48 per share to $0.54 per share (adjusted for 4-1 forward stock split).
Adjusted EPS: $1.15 per share to $1.19 per share (adjusted for 4-1 forward stock split).
Form 12b-25 Extension
The Company plans to file a Form 12b-25, Notification of Late Filing, with the U.S. Securities and Exchange Commission (“SEC”) related to the Form 10-Q for the quarter ended September 28, 2024. The Company is working to finalize its financial statements and currently intends to file its Form 10-Q by November 12, 2024, the end of the 5-day extension period.
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 and acquisition-related costs, net of tax benefits. 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. In addition, when presenting forward-looking non-GAAP metrics, we are unable to provide quantitative reconciliations to the most closely correlated GAAP measure due to the uncertainty in the timing, amount or nature of any adjustments, which could be material in any period.
Conference Call
NV5 will host a conference call to discuss its third quarter 2024 financial results at 4:30 p.m. (Eastern Time) on November 7, 2024. The accompanying presentation for the call is available by visiting http://ir.nv5.com.
| Date: |
|
Thursday, November 7, 2024 |
| Time: |
|
4:30 p.m. Eastern |
| Toll-free dial-in number: |
|
+1 800-715-9871 |
| International dial-in number: |
|
+1 646-307-1963 |
| Conference ID: |
|
2719957 |
| 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 GS: NVEE) is a provider of technology, conformity assessment, consulting solutions, and software applications for public and private sector clients supporting sustainable infrastructure, utility, and building assets and systems. The Company focuses on multiple verticals: construction quality assurance, infrastructure engineering, utility services, buildings & technology, 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) |
|
|
September 28, 2024 |
|
December 30, 2023 |
| Assets |
|
|
|
| Current assets: |
|
|
|
| Cash and cash equivalents |
$ |
73,257 |
|
|
$ |
44,824 |
|
| Billed receivables, net |
|
164,406 |
|
|
|
152,593 |
|
| Unbilled receivables, net |
|
143,274 |
|
|
|
111,304 |
|
| Prepaid expenses and other current assets |
|
18,185 |
|
|
|
18,376 |
|
| Total current assets |
|
399,122 |
|
|
|
327,097 |
|
| Property and equipment, net |
|
56,386 |
|
|
|
50,268 |
|
| Right-of-use lease assets, net |
|
33,743 |
|
|
|
36,836 |
|
| Intangible assets, net |
|
210,967 |
|
|
|
210,659 |
|
| Goodwill |
|
569,994 |
|
|
|
549,798 |
|
| Deferred income tax assets, net |
|
20,296 |
|
|
|
6,388 |
|
| Other assets |
|
2,695 |
|
|
|
3,149 |
|
| Total Assets |
$ |
1,293,203 |
|
|
$ |
1,184,195 |
|
|
|
|
|
| Liabilities and Stockholders’ Equity |
|
|
|
|
|
|
|
| Current liabilities: |
|
|
|
| Accounts payable |
$ |
72,194 |
|
|
$ |
54,397 |
|
| Accrued liabilities |
|
52,525 |
|
|
|
47,526 |
|
| Billings in excess of costs and estimated earnings on uncompleted contracts |
|
56,082 |
|
|
|
59,373 |
|
| Other current liabilities |
|
2,746 |
|
|
|
2,263 |
|
| Current portion of contingent consideration |
|
2,653 |
|
|
|
3,922 |
|
| Current portion of notes payable and other obligations |
|
8,627 |
|
|
|
9,267 |
|
| Total current liabilities |
|
194,827 |
|
|
|
176,748 |
|
| Contingent consideration, less current portion |
|
2,970 |
|
|
|
143 |
|
| Other long-term liabilities |
|
23,973 |
|
|
|
26,930 |
|
| Notes payable and other obligations, less current portion |
|
248,432 |
|
|
|
205,468 |
|
| Total liabilities |
|
470,202 |
|
|
|
409,289 |
|
|
|
|
|
| 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; 180,000,000 shares authorized, 65,155,904 and 63,581,020 shares issued and outstanding as of September 28, 2024 and December 30, 2023, respectively |
|
652 |
|
|
|
636 |
|
| Additional paid-in capital |
|
532,638 |
|
|
|
507,779 |
|
| Accumulated other comprehensive income (loss) |
|
653 |
|
|
|
(18 |
) |
| Retained earnings |
|
289,058 |
|
|
|
266,509 |
|
| Total stockholders’ equity |
|
823,001 |
|
|
|
774,906 |
|
| Total liabilities and stockholders’ equity |
$ |
1,293,203 |
|
|
$ |
1,184,195 |
|
|
NV5 GLOBAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF NET INCOME AND COMPREHENSIVE INCOME
(UNAUDITED)
(in thousands, except share data) |
|
|
Three Months Ended |
|
Nine Months Ended |
|
September 28,
2024 |
|
September 30,
2023 |
|
September 28,
2024 |
|
September 30,
2023 |
| Gross revenues |
$ |
250,885 |
|
|
$ |
237,545 |
|
|
$ |
694,750 |
|
|
$ |
642,301 |
|
|
|
|
|
|
|
|
|
| Direct costs: |
|
|
|
|
|
|
|
| Salaries and wages |
|
60,574 |
|
|
|
56,853 |
|
|
|
178,419 |
|
|
|
162,316 |
|
| Sub-consultant services |
|
46,910 |
|
|
|
44,960 |
|
|
|
114,324 |
|
|
|
112,367 |
|
| Other direct costs |
|
13,891 |
|
|
|
21,468 |
|
|
|
40,964 |
|
|
|
49,357 |
|
| Total direct costs |
|
121,375 |
|
|
|
123,281 |
|
|
|
333,707 |
|
|
|
324,040 |
|
|
|
|
|
|
|
|
|
| Gross profit |
|
129,510 |
|
|
|
114,264 |
|
|
|
361,043 |
|
|
|
318,261 |
|
|
|
|
|
|
|
|
|
| Operating expenses: |
|
|
|
|
|
|
|
| Salaries and wages, payroll taxes, and benefits |
|
66,922 |
|
|
|
60,262 |
|
|
|
200,466 |
|
|
|
171,883 |
|
| General and administrative |
|
20,897 |
|
|
|
20,257 |
|
|
|
64,320 |
|
|
|
49,728 |
|
| Facilities and facilities related |
|
5,873 |
|
|
|
6,011 |
|
|
|
17,869 |
|
|
|
17,208 |
|
| Depreciation and amortization |
|
15,303 |
|
|
|
12,981 |
|
|
|
44,745 |
|
|
|
36,371 |
|
| Total operating expenses |
|
108,995 |
|
|
|
99,511 |
|
|
|
327,400 |
|
|
|
275,190 |
|
|
|
|
|
|
|
|
|
| Income from operations |
|
20,515 |
|
|
|
14,753 |
|
|
|
33,643 |
|
|
|
43,071 |
|
|
|
|
|
|
|
|
|
| Interest expense |
|
(4,547 |
) |
|
|
(3,882 |
) |
|
|
(13,344 |
) |
|
|
(9,111 |
) |
|
|
|
|
|
|
|
|
| Income before income tax benefit (expense) |
|
15,968 |
|
|
|
10,871 |
|
|
|
20,299 |
|
|
|
33,960 |
|
| Income tax benefit (expense) |
|
1,110 |
|
|
|
2,185 |
|
|
|
2,250 |
|
|
|
(382 |
) |
| Net income |
$ |
17,078 |
|
|
$ |
13,056 |
|
|
$ |
22,549 |
|
|
$ |
33,578 |
|
|
|
|
|
|
|
|
|
| Earnings per share: |
|
|
|
|
|
|
|
| Basic |
$ |
0.28 |
|
|
$ |
0.21 |
|
|
$ |
0.37 |
|
|
$ |
0.56 |
|
| Diluted |
$ |
0.27 |
|
|
$ |
0.21 |
|
|
$ |
0.36 |
|
|
$ |
0.54 |
|
|
|
|
|
|
|
|
|
| Weighted average common shares outstanding: |
|
|
|
|
|
|
|
| Basic |
|
61,982,888 |
|
|
|
60,840,402 |
|
|
|
61,500,930 |
|
|
|
60,143,591 |
|
| Diluted |
|
63,042,962 |
|
|
|
61,991,348 |
|
|
|
62,769,575 |
|
|
|
61,794,767 |
|
|
|
|
|
|
|
|
|
| Comprehensive income: |
|
|
|
|
|
|
|
| Net income |
$ |
17,078 |
|
|
$ |
13,056 |
|
|
$ |
22,549 |
|
|
$ |
33,578 |
|
| Foreign currency translation income (loss), net of tax |
|
1,348 |
|
|
|
(421 |
) |
|
|
671 |
|
|
|
(612 |
) |
| Comprehensive income |
$ |
18,426 |
|
|
$ |
12,635 |
|
|
$ |
23,220 |
|
|
$ |
32,966 |
|
|
NV5 GLOBAL, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(in thousands) |
|
|
Nine Months Ended |
|
September 28, 2024 |
|
September 30, 2023 |
| Cash flows from operating activities: |
|
|
|
| Net income |
$ |
22,549 |
|
|
$ |
33,578 |
|
| Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
| Depreciation and amortization |
|
49,289 |
|
|
|
40,443 |
|
| Non-cash lease expense |
|
9,516 |
|
|
|
10,346 |
|
| Provision for doubtful accounts |
|
1,072 |
|
|
|
940 |
|
| Stock-based compensation |
|
19,943 |
|
|
|
16,504 |
|
| Change in fair value of contingent consideration |
|
— |
|
|
|
(7,518 |
) |
| Gain on disposals of property and equipment |
|
(653 |
) |
|
|
(633 |
) |
| Other |
|
296 |
|
|
|
— |
|
| Deferred income taxes |
|
(14,038 |
) |
|
|
(25,861 |
) |
| Amortization of debt issuance costs |
|
556 |
|
|
|
573 |
|
| Changes in operating assets and liabilities, net of impact of acquisitions: |
|
|
|
| Billed receivables |
|
(9,247 |
) |
|
|
(6,364 |
) |
| Unbilled receivables |
|
(28,930 |
) |
|
|
(26,902 |
) |
| Prepaid expenses and other assets |
|
3,029 |
|
|
|
1,944 |
|
| Accounts payable |
|
15,199 |
|
|
|
3,386 |
|
| Accrued liabilities and other long-term liabilities |
|
(6,063 |
) |
|
|
1,329 |
|
| Billings in excess of costs and estimated earnings on uncompleted contracts |
|
(4,438 |
) |
|
|
4,288 |
|
| Contingent consideration |
|
(1,455 |
) |
|
|
(1,307 |
) |
| Other current liabilities |
|
486 |
|
|
|
689 |
|
| Net cash provided by operating activities |
|
57,111 |
|
|
|
45,435 |
|
|
|
|
|
| Cash flows from investing activities: |
|
|
|
| Cash paid for acquisitions (net of cash received from acquisitions) |
|
(54,347 |
) |
|
|
(189,109 |
) |
| Proceeds from sale of assets |
|
270 |
|
|
|
295 |
|
| Purchase of property and equipment |
|
(13,410 |
) |
|
|
(14,257 |
) |
| Net cash used in investing activities |
|
(67,487 |
) |
|
|
(203,071 |
) |
|
|
|
|
| Cash flows from financing activities: |
|
|
|
| Borrowings from Senior Credit Facility |
|
58,000 |
|
|
|
188,000 |
|
| Payments on notes payable and other obligations |
|
(6,122 |
) |
|
|
(6,399 |
) |
| Payments of contingent consideration |
|
(1,585 |
) |
|
|
(793 |
) |
| Payments of borrowings from Senior Credit Facility |
|
(12,000 |
) |
|
|
(15,000 |
) |
| Purchases of common stock tendered by employees to satisfy the required withholding taxes related to stock-based compensation |
|
— |
|
|
|
(81 |
) |
| Net cash provided by financing activities |
|
38,293 |
|
|
|
165,727 |
|
|
|
|
|
| Effect of exchange rate changes on cash and cash equivalents |
|
516 |
|
|
|
(193 |
) |
|
|
|
|
| Net increase in cash and cash equivalents |
|
28,433 |
|
|
|
7,898 |
|
| Cash and cash equivalents – beginning of period |
|
44,824 |
|
|
|
38,541 |
|
| Cash and cash equivalents – end of period |
$ |
73,257 |
|
|
$ |
46,439 |
|
|
NV5 GLOBAL, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES
TO COMPARABLE GAAP FINANCIAL MEASURES
(UNAUDITED)
(in thousands, except share data) |
|
| RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 28,
2024 |
|
September 30,
2023 |
|
September 28,
2024 |
|
September 30,
2023 |
| Net Income |
$ |
17,078 |
|
|
$ |
13,056 |
|
|
$ |
22,549 |
|
|
$ |
33,578 |
|
| Add: |
Interest expense |
|
4,547 |
|
|
|
3,882 |
|
|
|
13,344 |
|
|
|
9,111 |
|
|
Income tax (benefit) expense |
|
(1,110 |
) |
|
|
(2,185 |
) |
|
|
(2,250 |
) |
|
|
382 |
|
|
Depreciation and amortization |
|
16,761 |
|
|
|
14,434 |
|
|
|
49,289 |
|
|
|
40,443 |
|
|
Stock-based compensation |
|
5,955 |
|
|
|
5,777 |
|
|
|
19,943 |
|
|
|
16,504 |
|
|
Acquisition-related costs* |
|
1,299 |
|
|
|
1,702 |
|
|
|
4,315 |
|
|
|
(2,959 |
) |
| Adjusted EBITDA |
$ |
44,530 |
|
|
$ |
36,666 |
|
|
$ |
107,190 |
|
|
$ |
97,059 |
|
|
| * Acquisition-related costs include contingent consideration fair value adjustments. |
| RECONCILIATION OF GAAP EPS TO ADJUSTED EPS |
|
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 28,
2024 |
|
September 30,
2023 |
|
September 28,
2024 |
|
September 30,
2023 |
| Net Income - per diluted share |
$ |
0.27 |
|
|
$ |
0.21 |
|
|
$ |
0.36 |
|
|
$ |
0.54 |
|
| Per diluted share adjustments: |
|
|
|
|
|
|
|
| Add: |
Amortization expense of intangible assets and acquisition-related costs |
|
0.22 |
|
|
|
0.20 |
|
|
|
0.66 |
|
|
|
0.47 |
|
|
Income tax expense |
|
(0.05 |
) |
|
|
(0.05 |
) |
|
|
(0.16 |
) |
|
|
(0.13 |
) |
| Adjusted EPS |
$ |
0.44 |
|
|
$ |
0.36 |
|
|
$ |
0.86 |
|
|
$ |
0.88 |
|
|
