Quanta Services (PWR)
Q2 2011 Earnings Call
August 03, 2011 9:30 am ET
Kenneth Trawick - President of Telecommunications & Renewables Division
James Haddox - Chief Financial Officer
James O'Neil - Chief Executive Officer, President and Director
Kip Rupp - Founder and Managing Partner
Scott Levine - JP Morgan Chase & Co
Alexander Rygiel - FBR Capital Markets & Co.
Craig Irwin - Wedbush Securities Inc.
Tahira Afzal - KeyBanc Capital Markets Inc.
Adam Thalhimer - BB&T Capital Markets
Peter Chang - Crédit Suisse AG
Sanjay Shrestha - Lazard Capital Markets LLC
John Rogers - D.A. Davidson & Co.
Jeffrey Beach - Stifel, Nicolaus & Co., Inc.
Andrew Wittmann - Robert W. Baird & Co. Incorporated
Daniel Mannes - Avondale Partners, LLC
Will Gabrielski - Gleacher & Company, Inc.
Previous Statements by PWR
» Quanta Services' CEO Discusses Q1 2011 Results - Earnings Call Transcript
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» Quanta Services CEO Discusses Q3 2010 Results - Earnings Call Transcript
Great. Thank you, Alissa, and welcome, everyone, to Quanta Services conference call to review second quarter of 2011 results. Before I turn the call over to management, I have the normal housekeeping details to run through. If you would like to have Quanta's news releases and other information emailed to you when they occur, please sign up for email information alerts by going to the Investors & Media section of Quanta Services website at quantaservices.com.
A replay of today's call will be available via webcast on Quanta's website at quantaservices.com. In addition, a telephonic recorded instant replay will be available for the next 7 days, 24 hours a day, that can be accessed as set forth in the press release.
Please remember the information reported on this call speaks only as of today, August 3, 2011. And therefore, you're advised that any time-sensitive information may no longer be accurate as of the time of any replay of this call. This conference call will include forward-looking statements intended to qualify under the Safe Harbor from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements include any statements reflecting Quanta's expectations, intentions, assumptions or beliefs about future events or performance or that do not solely relate to historical or current facts. Forward-looking statements involve certain risks, uncertainties and assumptions that are difficult to predict or are beyond Quanta's control, and actual results may differ materially from those expected or implied as forward-looking statements. Management cautions that you should not place undue reliance on Quanta's forward-looking statements, and Quanta does not undertake any obligation to update any forward-looking statements to reflect events or circumstances after this call. For additional information concerning some of the risks, uncertainties and assumptions that could affect Quanta's forward-looking statements, please refer to the company's annual report on Form 10-K for the year ended December 31, 2010, its quarterly reports on Form 10-Q and its other documents filed with the Securities and Exchange Commission, which may be obtained through the SEC's website at sec.gov.
With that, I would now like to turn the call over to Mr. Jim O'Neil, Quanta's President and CEO. Jim?
Thanks, Kip. Good morning, everyone, and welcome to Quanta Services Second Quarter 2011 Earnings Conference Call. I will start the call with an operational overview before I turn the call over to James Haddox, Quanta's CFO, to provide a detailed review of our second quarter financial results. Following Jame's comments, we will welcome your questions.
Revenues for the second quarter increased 16.1% over the second quarter of last year to $1 billion. For the second quarter, diluted earnings per share were $0.15 compared to diluted earnings per share of $0.16 in the second quarter of last year. Adjusted diluted earnings per share were $0.19 compared to adjusted diluted earnings per share of $0.22 in the same quarter last year. Both our 12-month and total backlog at the end of the second quarter were at record levels. Our 12-month backlog at the end of the second quarter increased 19.3%, and total backlog increased 18.2% compared to backlog at the end of the second quarter of 2010.
During the quarter, our Electric Power segment generated revenues of $667 million, and revenues grew organically by 32% compared to the same period last year. We continue to see momentum build in this segment, and expect revenue growth and margin expansion throughout this year as we continue to mobilize on large transmission projects. The increase in Electric Power segment revenues was partially offset by our Natural Gas and Pipeline segment, which experienced a 20% decrease in revenues to $210 million compared to the same period last year. The revenue decline was due to continued delays in large diameter transmission pipeline work primarily related to regulatory headwinds. However, since the end of the quarter, we have been awarded approximately $150 million of transmission pipeline work, most of which is expected to generate fourth quarter revenues. We expect this momentum to build with future awards throughout the remainder of this year and 2012.
While our Telecommunications segment revenues were 10% lower for this quarter versus the same period last year, we anticipate this segment's revenues will begin to accelerate during the third quarter and continue throughout this year, driven by broadband stimulus, 4G and LTE opportunities. Overall, we are seeing positive trends across all of our operating segments as we move into the third quarter despite continued regulatory and environmental delays on some projects.
Looking at our operating segments in more detail. Our Electric Power segment 12-month backlog as of the end of the second quarter increased 55.6%, and total backlog increased 22.5% as compared to the second quarter of 2010. We believe this industry is in early stages of unprecedented levels of transmission investment, as utilities interconnect new renewable energy-generating facilities to the electric grid and implement grid reliability initiatives. We are seeing a number of large electric transmission projects yet to be awarded in -- for the remainder of this year and in 2012.