Comfort Systems USA(US:FIX)2024-10-24 20:39Financial Performance - Revenue for the three months ended September 30, 2024, was $1,812,366, a 31.5% increase from $1,378,124 in the same period of 2023[8] - Gross profit for the nine months ended September 30, 2024, reached $1,042,673, up 46.7% from $710,824 in the prior year[8] - Operating income for the three months ended September 30, 2024, was $202,884, representing a 50.0% increase compared to $135,143 in the same quarter of 2023[8] - Net income for the nine months ended September 30, 2024, was $376,563, a 62.5% increase from $231,817 in the same period of 2023[8] - Basic income per share for the three months ended September 30, 2024, was $4.10, compared to $2.93 for the same period in 2023, reflecting a 40.0% increase[8] Expenses and Costs - Selling, general, and administrative expenses for the three months ended September 30, 2024, were $180,177, up 26.0% from $142,935 in the same quarter of 2023[8] - The company reported a provision for income taxes of $41,577 for the three months ended September 30, 2024, compared to $20,313 in the same quarter of 2023[8] - Interest income for the three months ended September 30, 2024, was $3,825, significantly higher than $952 in the same period of 2023[8] Cash Flow and Liquidity - Cash flows from operating activities for the nine months ended September 30, 2024, were $638,594, up from $466,560 in 2023, indicating a 36.8% increase[16] - The company reported a net cash increase of $210,433 for the nine months ended September 30, 2024, compared to $80,409 in the same period of 2023, reflecting a 161.5% increase[16] - Cash and cash equivalents amounted to $415.6 million as of September 30, 2024, reflecting a stable liquidity position[53] Stockholders' Equity and Dividends - Total stockholders' equity as of September 30, 2023, was $1,207,162, an increase from $999,923 at the end of 2022[11] - The company declared dividends of $0.225 per share for the three months ended September 30, 2023[11] - The company issued dividends of $0.30 per share, totaling $10,688 for the nine months ended September 30, 2024, compared to $21,455 in 2023[16] Acquisitions and Investments - The acquisition of Summit Industrial Construction, LLC was completed on February 1, 2024, enhancing the company's capabilities in industrial contracting[56] - The acquisition of J&S Mechanical Contractors, Inc. resulted in revenue of $106.3 million for the eight months from the acquisition date[63] - The company has a $6.1 million investment in a construction-focused technology fund, recorded at cost and reviewed quarterly for impairment[35] Revenue Recognition and Performance Obligations - Revenue is recognized based on the extent of progress towards completion of performance obligations, using a cost-to-cost input method[24] - Revenue is recognized over time as services are delivered, with variable amounts included in the contract price based on the likelihood of significant reversals[36] - Adjustments to revenue and operating income are recognized quarterly on a cumulative catch-up basis, affecting profitability based on changes in estimates[43] Debt and Financing - Total debt as of September 30, 2024, is $68.4 million, an increase of 54.5% from $44.2 million on December 31, 2023[72] - The company has an $850 million senior credit facility, with $770 million available as of September 30, 2024, and no outstanding borrowings[73] Market and Operational Insights - The company operates primarily in the commercial, industrial, and institutional markets, focusing on sectors such as manufacturing, healthcare, education, and government facilities[97] - The company expects high demand levels to continue into 2025, particularly in the manufacturing and technology sectors[114] - Labor costs and material delivery delays are anticipated to persist through 2024, impacting overall operational costs[114] Backlog and Future Revenue - Remaining performance obligations totaled $5.68 billion as of September 30, 2024, with an expected revenue recognition of 65-75% over the next 12 months[49] - Backlog as of September 30, 2024, was $5.68 billion, a 32.5% increase from $4.29 billion on September 30, 2023[129]