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

August 10, 2021

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   

 


Primary Logo

Source: NV5 Global, Inc.