MasTec(US:MTZ)2025-10-31 14:00Financial Data and Key Metrics Changes - Revenue for the third quarter was just shy of $4 billion, representing a 22% year-over-year increase [4] - Adjusted EBITDA was $374 million, a 20% year-over-year increase, marking the highest level since Q1 2024 [4] - Adjusted earnings per share was $2.48, exceeding consensus by nearly $0.20 [4] - Backlog at quarter end was $16.8 billion, a sequential increase of approximately $325 million [4] Business Line Data and Key Metrics Changes - Communications segment revenue grew by 33% year-over-year, with EBITDA increasing by 38% [5] - Clean energy and infrastructure segment revenue increased by 20% year-over-year, with EBITDA improving by 36% [5] - Power delivery segment revenue grew by 17% year-over-year, with EBITDA increasing by 21% [5] Market Data and Key Metrics Changes - Total backlog increased by 21% year-over-year, with a book-to-bill ratio of 1.1 times [7] - Communications segment backlog totaled $5.1 billion, showing a slight sequential increase despite record quarterly revenue [18] - Power delivery backlog increased by 11% year-over-year, with expectations for continued growth [10] Company Strategy and Development Direction - The company is focused on diversifying its business to benefit from the changing landscape of power generation and delivery [6] - There is a strong outlook for continued growth driven by significant investments in infrastructure across communications, energy, and power sectors [27] - The company is actively pursuing a disciplined, return-focused capital allocation strategy, including investments in equipment and capacity expansion [27] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the growth trajectory of the business across all operating segments, citing strong infrastructure investment needs [27] - The company remains optimistic about the power delivery segment, expecting double-digit growth in revenues and EBITDA for the full year 2025 [10] - Management highlighted the importance of ongoing investments in operating productivity and cost management to achieve better margins [25] Other Important Information - The company generated cash flow from operations of $89 million in Q3 and free cash flow of $36 million [26] - Total liquidity at the end of the quarter was approximately $2 billion, with net leverage of 1.95 times [27] - The company has a share repurchase authorization and will deploy capital for buybacks opportunistically [27] Q&A Session Summary Question: Can you provide guidance on pipeline backlog revenue for 2026? - Management indicated optimism about achieving double-digit growth in 2026, with substantial growth expected in 2027 and beyond based on committed projects [30][31] Question: What is the expected CapEx level for 2026? - CapEx is expected to be around $350 million, slightly above depreciation levels, reflecting growth opportunities in the pipeline segment [32][33] Question: How are permitting issues with GreenLink impacting guidance? - The change in guidance is primarily due to GreenLink, with expected revenue for 2025 now around $250 million, significantly lower than previous expectations [38][39] Question: How many large projects can the company handle simultaneously? - Management expressed confidence in handling multiple projects, emphasizing that most of the power delivery business is maintenance-driven, providing a stable revenue base [41][42] Question: Is $8 EPS still achievable for next year? - Management is comfortable with consensus estimates of over $8 EPS, supported by expected revenue and EBITDA growth [44][45] Question: What is the outlook for margins in the communications segment? - Margins in the communications segment improved to 11.3%, with expectations for continued growth driven by investments in new geographies [50][51] Question: How does the delay in GreenLink affect overall project profitability? - Management does not expect any negative impact on profitability from the GreenLink project, only a shift in timing [54][55]