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Quanta Services (PWR)
Q4 2011 Earnings Call
February 22, 2012 9:30 am ET
Kip A. Rupp - Founder and Managing Partner
James O'Neil -
James Haddox - Chief Financial Officer
Will Gabrielski - Lazard Capital Markets LLC, Research Division
Jeffrey L. Beach - Stifel, Nicolaus & Co., Inc., Research Division
Daniel J. Mannes - Avondale Partners, LLC, Research Division
William D. Bremer - Maxim Group LLC, Research Division
Tahira Afzal - KeyBanc Capital Markets Inc., Research Division
Shawn E. Lockman - Piper Jaffray Companies, Research Division
Joseph Ritchie - Goldman Sachs Group Inc., Research Division
Scott J. Levine - JP Morgan Chase & Co, Research Division
Adam R. Thalhimer - BB&T Capital Markets, Research Division
Alexander J. Rygiel - FBR Capital Markets & Co., Research Division
Jamie L. Cook - Crédit Suisse AG, Research Division
Craig E. Irwin - Wedbush Securities Inc., Research Division
John Rogers - D.A. Davidson & Co., Research Division
Morris Ajzenman - Griffin Securities, Inc., Research Division
Previous Statements by PWR
» Quanta Services' CEO Discusses Q3 2011 Results - Earnings Call Transcript
» Quanta Services' CEO Discusses Q2 2011 Results - Earnings Call Transcript
» Quanta Services' CEO Discusses Q1 2011 Results - Earnings Call Transcript
Kip A. Rupp
Great. Thanks, Jackie, and welcome, everyone, to the Quanta Services conference call to review fourth quarter and full year 2001 (sic)  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 news releases and other information e-mailed to you when they occur, please sign up for the e-mail information alerts by going to the Investors & Media section of the Quanta Services website at quantaservices.com.
A replay of today's call will be available 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 that information reported on this call speaks only as of today, February 22, 2012, and therefore, you're advised that any time-sensitive information may no longer be accurate as of the time of any replay on 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 all 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 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. 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 on Quanta's website or through the SEC's website at sec.gov.
Before I turn the call over to management, I wanted to remind the institutional investors and sell-side analysts on this call that we're hosting the Quanta Services 2012 Investor Day in New York City on March 7. Attendance of this event is limited to the institutional investment community. If you're an institutional investor or sell-side analyst and would like to attend our Investor Day, please contact me for registration information. For those that can't attend the meeting in person, we will be webcasting the event and will also be -- have archived audio and other material available after the event on our website.
With that, I would like to now 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 Fourth Quarter and Full Year 2011 Earnings Conference Call. I will start the call with an operational overview before turning the call over to James Haddox, Quanta's CFO, to provide a detailed review of our fourth quarter and full year financial results. Following James' comments, we will welcome your questions.
Our fourth quarter results are reflective of strong execution by our operations. Our revenues grew 37% compared to the fourth quarter of 2010, and our GAAP and non-GAAP adjusted diluted earnings per share increased 100% and 78%, respectively, over the same period last year. The overall momentum in our business, particularly the number of electric transmission projects in construction, drove revenues higher in the fourth quarter versus the third quarter. As a result, we experienced sequential revenue growth of 21% and growth in GAAP and non-GAAP adjusted diluted earnings per share of 28% and 41%, respectively, versus the third quarter of 2011.
Here's some additional financial data to put our comments about the momentum in our business into context. Revenues in the last 6 months of 2011 increased almost 49% over revenues from the first 6 months of 2011, and operating income increased more than fivefold when comparing the same periods. Further, revenues for the last 6 months of 2011 increased approximately 20% over revenues for the last 6 months of 2010, and operating income increased about 25% for the same period comparison. Our strong fourth quarter and second half of 2011 results support our optimism for continued profitable growth in 2012.
For the full year of 2011, revenues increased approximately 18% despite project delays across all of our operating segments in the first half of the year, caused mainly by heightened regulatory environment. The primary driver of our 2011 revenue growth came from our Electric Power and telecommunications segments, which increased revenues year-over-year by approximately 48% and 23%, respectively.
Our Natural Gas and Pipeline segment had a challenging year from both a revenue and profit perspective. But as I will discuss later in my comments, there are indications that 2012 should be a better year than 2011 for this segment. Both our 12-month and total backlog at year end were at record levels. Our 12-month backlog at the end of 2011 increased about 24%, and total backlog increased approximately 15% compared to backlog at year-end 2010.
Turning to our Electric Power segment. 12-month backlog at the end of 2011 for the Electric Power segment increased nearly 32%, and total backlog for this segment increased nearly 11% compared to the end of 2010. We believe we are still in the early stages of a multiyear transmission build out in the United States and Canada and expect our Electric Power segment backlog to remain strong throughout 2012 and beyond.