Primoris(US:PRIM)2025-05-05 21:43Part I. Financial Information Item 1. Financial Statements This section presents Primoris Services Corporation's unaudited condensed consolidated financial statements and detailed accounting notes Condensed Consolidated Balance Sheets Condensed Consolidated Balance Sheets | Metric | March 31, 2025 (in Thousands) | December 31, 2024 (in Thousands) | Change (in Thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | :-------------------- | | Total Assets | $4,217,488 | $4,195,868 | +$21,620 | | Total Liabilities | $2,771,748 | $2,786,335 | -$14,587 | | Total Stockholders' Equity | $1,445,740 | $1,409,533 | +$36,207 | | Cash and cash equivalents | $351,581 | $455,825 | -$104,244 | | Contract assets | $939,014 | $773,736 | +$165,278 | | Long-term debt, net of current portion | $543,924 | $660,193 | -$116,269 | Condensed Consolidated Statements of Income Condensed Consolidated Statements of Income | Metric | Three Months Ended March 31, 2025 (in Thousands) | Three Months Ended March 31, 2024 (in Thousands) | Change (in Thousands) | % Change | | :-------------------------------- | :------------------------------------- | :------------------------------------- | :-------------------- | :------- | | Revenue | $1,648,112 | $1,412,707 | +$235,405 | +16.7% | | Gross profit | $170,657 | $133,376 | +$37,281 | +28.0% | | Operating income | $70,364 | $44,238 | +$26,126 | +59.0% | | Net income | $44,240 | $18,943 | +$25,297 | +133.5% | | Basic EPS | $0.82 | $0.35 | +$0.47 | +134.3% | | Diluted EPS | $0.81 | $0.35 | +$0.46 | +131.4% | Condensed Consolidated Statements of Comprehensive Income Condensed Consolidated Statements of Comprehensive Income | Metric | Three Months Ended March 31, 2025 (in Thousands) | Three Months Ended March 31, 2024 (in Thousands) | Change (in Thousands) | % Change | | :-------------------------------- | :------------------------------------- | :------------------------------------- | :-------------------- | :------- | | Net income | $44,240 | $18,943 | +$25,297 | +133.5% | | Foreign currency translation adjustments | $96 | $(1,273) | +$1,369 | N/A | | Comprehensive income | $44,336 | $17,670 | +$26,666 | +150.9% | Condensed Consolidated Statements of Stockholders' Equity Condensed Consolidated Statements of Stockholders' Equity | Metric | March 31, 2025 (in Thousands) | December 31, 2024 (in Thousands) | Change (in Thousands) | | :-------------------------------- | :----------------------------- | :----------------------------- | :-------------------- | | Total Stockholders' Equity | $1,445,740 | $1,409,533 | +$36,207 | | Net income | $44,240 | N/A | N/A | | Dividends declared | $(4,324) | N/A | N/A | | Conversion of stock based awards, net of shares withheld for taxes | $(9,911) | N/A | N/A | Condensed Consolidated Statements of Cash Flows Condensed Consolidated Statements of Cash Flows | Cash Flow Activity | Three Months Ended March 31, 2025 (in Thousands) | Three Months Ended March 31, 2024 (in Thousands) | Change (in Thousands) | | :-------------------------------- | :------------------------------------- | :------------------------------------- | :-------------------- | | Net cash provided by (used in) operating activities | $66,172 | $(28,464) | +$94,636 | | Net cash (used in) provided by investing activities | $(33,178) | $4,187 | -$37,365 | | Net cash used in financing activities | $(137,264) | $(15,106) | -$122,158 | | Net change in cash, cash equivalents and restricted cash | $(104,259) | $(39,697) | -$64,562 | Notes to Condensed Consolidated Financial Statements This section provides detailed explanations of the company's accounting policies, financial instruments, and revenue recognition - The company operates in the United States and Canada, providing infrastructure services through two segments: Utilities and Energy17 - As of March 31, 2025, the company had $5.8 billion in remaining performance obligations, with 59.9% expected to be recognized as revenue in the next 12 months38 - The company's effective tax rate for the three months ended March 31, 2025, and 2024, was 29.0%, differing from the U.S. federal statutory rate of 21.0% primarily due to state income taxes and nondeductible per diem expenses75 - Total goodwill remained unchanged at $856.9 million as of March 31, 2025, with $703.5 million allocated to Utilities and $153.4 million to Energy59 - The company's long-term debt, net of current portion, decreased by $116.3 million from December 31, 2024, to March 31, 2025, primarily due to significant payments on the term loan63173 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses the company's financial condition and operational results for Q1 2025, covering trends, accounting policies, segment performance, liquidity, and market impacts Forward Looking Statements This section outlines the inherent risks and uncertainties associated with forward-looking statements, which may cause actual results to differ materially - Forward-looking statements are subject to "safe harbor" provisions and involve known and unknown risks that may cause actual results to differ materially115116 - Key risk factors include customer timing, project duration, weather, economic conditions, changes in customer/project mix, commodity price volatility, inflation, tariffs, labor availability, and regulatory changes116 Introduction Primoris Services Corporation is a leading infrastructure services provider in the United States and Canada, operating through Utilities and Energy segments with diverse contract types - Primoris Services Corporation is a leading provider of infrastructure services in the United States and Canada121 - The company operates through two reportable segments: Utilities and Energy, serving diversified customers across various industries121124 - Revenue is generated from fixed-price, unit-price, time and material, and cost-reimbursable contracts, with revenue recognition typically over time based on work completion125 Material trends and uncertainties The company faces challenges from cost inflation, fluctuating commodity prices, and interest rate changes, impacting profitability and demand for services - The company anticipates elevated levels of cost inflation in 2025 and attempts to mitigate impacts through price escalation provisions, but contractual caps can negatively affect profitability129 - Fluctuations in oil, gas, and other fuel prices affect demand for services, particularly in the pipeline industry, while increased demand for electric power expands opportunities in renewable energy and battery storage131132 - A 1.0% increase or decrease in interest rates would change annual interest expense by approximately $5.7 million, based on variable rate debt outstanding as of March 31, 2025133183 Seasonality, cyclicality and variability Company results are subject to quarterly variations due to weather and client budget cycles, typically leading to lower revenue and earnings in the