Quanta Services, Inc. (PWR)
Q2 FY08 Earnings Call
August 6, 2008, 09:30 AM ET
Kip Rupp - DRG&E
John R. Colson - President and CEO
Kenneth W. Trawick - President of Telecommunications and Cable Television Division
James H. Haddox - CFO
John R. Wilson - President and Electric Power and Gas Division
Tahira Afzal - KeyBanc Capital Markets
Alex Rygiel - Friedman, Billings, Ramsey
Jamie Cook - Credit Suisse First Boston
Sanjay Shrestha - Lazard Capital Markets
John B. Rogers - D.A. Davidson
Jeffrey Beach - Stifel Nicolaus
Steve Gambuzza - Longbow Capital
Previous Statements by PWR
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I'd now like to turn the conference over to Kip Rupp, with DRG&E. Please go ahead, sir.
Kip Rupp - DRG&E
Alright, thank you, Mitch and welcome everyone to Quanta Services' conference call to review 2008 second quarter results. Before I turn the call over to management, I have the normal housekeeping details to run through. If you'd like to be on the e-mail or fax distribution list to receive future press releases for Quanta, or if you had any technical difficulty this morning and did not receive your e-mail or fax, please call our offices at DRG&E, at 713-529-6600.
Also, if you'd like to listen to a replay of today's call, it will be available via webcast by going to Quanta's website, at quantaservices.com. In addition, there is a telephonic recorded instant replay that will be available for the next seven days, 24 hours a day that can be accessed as set forth in the press release, by dialing 303-590-3000, and using the pass code 11116519.
Please remember that information reported on this call speaks only as of today, August 06, 2008 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.
Also this conference 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, but are not limited to, projected revenues, earnings per share, tax rates, capital expenditures, and other projections of financial and operating results and information, growth in particular markets, Quanta's strategies and plans, anticipated future projects, expected benefits from the merger with InfraSource Services, and any other 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.
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. 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.
For additional information concerning some of the risks, uncertainties and assumptions that could affect our forward-looking statements, please refer to the company's annual report on Form 10-K for the year ended December 31, 2007, its quarterly report on Form 10-Q for the quarter ended, March 31, 2008 and its other documents filed with Securities and Exchange Commission which may be obtained through the SEC's website at www.SEC.gov. All forward-looking statements, whether written or oral, are expressly qualified by these cautionary statements and any other cautionary statements that may accompany such forward-looking statements.
With that, I'd like to now turn the call over to Mr. John Colson, Quanta's Chairman and CEO. John?
John R. Colson - President and Chief Executive Officer
Good morning everyone and welcome to Quanta Services second quarter 2008 conference call. To start call this morning I will provide a general overview of the quarter, insight on developments in the industries we serve and perspectives on emerging opportunities.
My comments will be followed by a review of our telecommunications, cable television and wireless operations by Ken Trawick, President of those operations and a review of the financial results by James Haddox, our Chief Financial Officer. John Wilson, President of Quanta's Electric Power and Natural Gas Operations, is also present to answer questions. After our prepared remarks, we will open the call for questions.
The second quarter of 2008 continued a strong trend of revenue growth and margin expansion for Quanta. We continue to perform well in the industries we serve and are well positioned to leverage emerging [ph] opportunities. Revenues for the quarter were approximately $961 million compared to $552 million in the second quarter of 2007. The second quarter of 2008 revenues include constitution from operations added through the acquisition of InfraSource completed in August of 2007, as well as a couple of smaller acquisitions we have completed since the end of the second quarter 2007. Internal revenue growth, however, was strong at approximately 20% compared to the second quarter of 2007 pro forma to include these acquisitions at both periods.
We continue to be optimistic, although we're closely monitoring current and projected economic conditions. By design, Quanta's revenues base is diverse. Our service scope is broad and our operations are efficient, minimizing the impact of the fluctuating economy.
Oil prices increased significantly during the first two quarters of this year, our margins remain strong in most of the in the industries we serve. This is primarily attributable to growing demand for our services. However, multiyear strategic initiatives focused on increasing efficiencies strengthened our operations and our ability to strategically manage our business also contributed.