EME - EMCOR Group Inc. (EME) Q1 2024 Earnings Call Transcript

2024-04-25 16:18:08 ET

EMCOR Group, Inc. (EME)

Q1 2024 Earnings Conference Call

April 25, 2024 10:30 AM ET

Company Participants

Andy Backman – Vice President-Investor Relations

Tony Guzzi – Chairman, President and Chief Executive Officer

Jason Nalbandian – Senior Vice President and Chief Financial Officer

Conference Call Participants

Brent Thielman – D.A. Davidson

Adam Thalhimer – Thompson Davis

Alex Dwyer – KeyBanc

Presentation

Operator

Good morning. My name is Marlese, and I will be your conference operator today. At this time, I would like to welcome everyone to the EMCOR Group’s First Quarter 2024 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers’ prepared remarks, there will be a question-and-answer session. [Operator Instructions]

I will now turn the call over to Andy Backman, Vice President of Investor Relations. Mr. Backman, you may begin.

Andy Backman

Thank you, Marlese, and good morning, everyone, and welcome to EMCOR’s first quarter 2024 earnings conference call. For those of you joining us by webcast, we are at the beginning of our slide presentation that will accompany our remarks today. This presentation will be archived in the Investor Relations section of our website at emcorgroup.com. With me today are Tony Guzzi, our Chairman, President and Chief Executive Officer; Jason Nalbandian, Senior Vice President and EMCOR’s newly appointed Chief Financial Officer; and Maxine Mauricio, Executive Vice President, Chief Administrative Officer and General Counsel. For today’s call, Tony will provide comments on our first quarter. Jason will then review our first quarter numbers before turning it back to Tony to discuss RPOs, key market drivers and how they impact our business segments as well as reviewing our revised 2024 guidance before we open it up for Q&A.

Before we begin, as a reminder, this presentation and discussion contains certain forward-looking statements and may contain certain non-GAAP financial information. Slide 2 of our presentation describes in detail these forward-looking statements and the non-GAAP financial information disclosures. I encourage everyone to review both disclosures in conjunction with our discussion and accompanying slides. And finally, as a reminder, all financial information discussed during this morning’s call is included in our consolidated financial statements within both our earnings press release issued this morning and in our Form 10-Q filed with the Securities and Exchange Commission.

And with that, let me turn the call over to Tony. Tony?

Tony Guzzi

Good morning. Thanks, Andy, and thanks all of you for joining our call. I’m going to begin my discussion on Page 4. We had an exceptional start to the year at EMCOR. It was another quarter of records as our performance established new first quarter records for revenues, operating income, operating margin and diluted earnings per share and operating cash flow. We earned $4.17 per diluted share and grew revenues by 18.7% to $3.43 billion. Revenues increased 18.5% organically. And we were still able to grow RPOs to $9.2 billion, an increase of $1.3 billion or 16.5% versus the year ago period. Our consolidated operating margin was a very strong 7.6%.

The performance of our Electrical and Mechanical Construction segments this quarter continued to exceed our already high expectations. Our Electrical Construction segment revenues grew 18.6% with operating margin reaching a record 12%. Our Mechanical Construction segment grew revenues 32.4% with record first quarter revenues and a record first quarter operating margin of 10.6%. We executed well with strong demand across many of the market sectors we serve, including high-tech and traditional manufacturing as well as network and communications, which includes our data center work. We had outstanding performance of some of the most demanding projects for our most sophisticated customers....

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