SOURCE: NV5 Holdings, Inc.

NV5 Holdings, Inc.

August 13, 2015 16:01 ET

NV5 Announces Record Second Quarter and Year-to-Date 2015 Financial Results and Raises Guidance

HOLLYWOOD, FL--(Marketwired - Aug 13, 2015) - NV5 Holdings, Inc. (NASDAQ: NVEE)

  • Second Quarter 2015 Gross Revenues Increased 18% to $34.5 Million from $29.2 Million
  • Second Quarter 2015 Net Income Increased 64% to $1.7 Million from $1.1 Million
  • Second Quarter 2015 Diluted EPS increased 32% to $0.25 over 6.8 million shares compared to $0.19 over 5.6 million shares in the second quarter of 2014
  • Raises Full-Year 2015 Gross Revenues Guidance up to $160 Million and Diluted EPS Guidance up to $1.17

NV5 Holdings, Inc. (NASDAQ: NVEE) ("NV5" or the "Company"), a provider of professional and technical engineering and consulting solutions, today reported financial results for the second quarter ended June 30, 2015.

Second Quarter 2015 Financial Highlights

  • Gross revenues for the quarter increased 18% year-over-year to $34.5 million
  • Organic growth for the quarter was 13%
  • EBITDA for the quarter increased 56% to $3.5 million from $2.3 million for the second quarter of 2014
  • Net income for the quarter increased 64% to $1.7 million from $1.1 million for the second quarter of 2014
  • Diluted EPS for the quarter increased 32% to $0.25 over 6.8 million shares compared to $0.19 over 5.6 million shares in the second quarter of 2014
  • Backlog of $116.8 million as of June 30, 2015 and $146.8 million including backlog acquired on July 1, 2015 from the RBA Group, Inc. ("RBA") compared to $95.7 million as of March 31, 2015 and $82.1 million as of December 31, 2014

"We are pleased to announce another record breaking quarter of earnings for our shareholders characterized by accelerated organic growth, M&A growth, and strong operational performance improvement," said Dickerson Wright, Chairman and CEO of NV5. "Some of our accomplishments included: executing our largest acquisition since 2010, RBA, realizing significant earnings growth over a substantial increase in total shares outstanding, and completing a successful secondary offering. As a result of our May 2015 secondary offering, we raised net proceeds of $29.4 million, which will support the execution of new accretive acquisitions during fiscal year 2015 and 2016. We also reported a sizeable increase in our backlog as a result of numerous new contracts and notable award wins."

Gross revenues for the second quarter of 2015 were $34.5 million, an 18% increase from the second quarter of 2014. Net revenue for the second quarter of 2015 was $27.7 million, an increase of 27% from the second quarter of 2014. Our organic growth for the second quarter of 2015 was 13%. The increases in gross and net revenues were due primarily to organic growth from our existing platform as well as the contributions from the Company's acquisitions in 2014 and during the first six months of 2015.

EBITDA for the second quarter of 2015 was $3.5 million or 10.2% of gross revenues, an increase of 56% from the second quarter of last year.

Net income for the second quarter of 2015 was $1.7 million, or $0.25 per diluted share, up from net income of $1.1 million, or $0.19 per diluted share in the second quarter of 2014. Diluted earnings per share reflect weighted-average shares outstanding of 6,838,725 for the second quarter of 2015, compared to weighted-average shares outstanding of 5,612,344 for the second quarter of 2014. Included in the weighted-average shares outstanding for the second quarter of 2015, is the impact of 1,644,500 shares issued from our secondary offering on May 28, 2015.

Six Months Ended June 2015 Financial Highlights

  • Gross revenues increased 32% to $63.6 million, compared to $48.2 million in the first six months of 2014
  • Organic growth for the first six months of 2015 was 12%
  • EBITDA increased 56% to $5.9 million from $3.8 million in the first six months of 2014
  • Net income increased 60% to $2.8 million from $1.8 million in the first six months of 2014
  • Diluted EPS for the first six months of 2015 increased 38% to $0.44 compared to $0.32 for the first six months of 2014

Gross revenues for the six months ended June 30, 2015 increased 32% to $63.6 million, compared to $48.2 million reported for the six months ended June 30, 2014. Net revenue for the six months ended June 30, 2015 was $50.5 million, an increase of 37% for the six months ended June 30, 2014. Our organic growth for the six months ended June 30, 2015 was 12%. The increases in gross and net revenues were due primarily to organic growth from our existing platform as well as the contributions from the Company's acquisitions in 2014 and during the first six months of 2015.

EBITDA for the six months ended June 30, 2015 was $5.9 million or 9.3% of gross revenues, an increase of 56% from the six months ended June 30, 2014.

Net income for the six months ended June 30, 2015 was $2.8 million, or $0.44 per diluted share, up from net income of $1.8 million, or $0.32 per diluted share for the six months ended June 30, 2014. Diluted earnings per share reflect weighted-average shares outstanding of 6,437,546 for the six months ended June 30, 2015, compared to weighted-average shares outstanding of 5,502,696 for the six months ended June 30, 2014. Included in the weighted-average shares outstanding for the six months ended June 30, 2015, is the impact of 1,644,500 shares issued from our secondary offering on May 28, 2015.

Cash flow from operating activities increased $3.4 million for the six months ended June 30, 2015 compared to the same period in 2014. Cash flow from operating activities for the six months ended June 30, 2015 was $1.0 million, compared to cash used in operating activities of $2.4 million for the six months ended June 30, 2014. At June 30, 2015, cash and cash equivalents were $33.8 million.

At June 30, 2015, the Company reported backlog of $116.8 million, an increase of 22% from $95.7 million as of March 31, 2015 and 42% from $82.1 million as of December 31, 2014. However, including the backlog acquired on July 1, 2015 from RBA the Company's backlog is $146.8 million.

2015 Outlook

The Company is raising its guidance for full-year 2015 gross revenues and diluted earnings per share. The Company now expects full-year 2015 gross revenues, including the impact of acquisitions closed through July 31, 2015, to range from $155 million to $160 million, which represents an increase to 48% from 2014 gross revenues of $108.4 million. The Company further expects that full-year 2015 diluted earnings per share will range from $1.07 per share to $1.17 per share, representing an increase to 34% over diluted earnings per share of $0.87 for the full-year 2014. Included in the guidance for diluted earnings per share, is the impact of 1,644,500 shares issued from our secondary offering on May 28, 2015. Furthermore, this guidance for gross revenues and diluted earnings per share excludes anticipated acquisitions for the remainder of 2015.

Use of Non-GAAP Financial Measures

Earnings before interest, taxes, depreciation and amortization ("EBITDA") is not a measure of financial performance under U.S. generally accepted accounting principles ("GAAP"). Management believes EBITDA, in addition to operating profit, net income and other GAAP measures, is a useful indicator of NV5's financial and operating performance and its ability to generate cash flows from operations that are available for taxes, capital expenditures and debt service. A reconciliation of net income as reported in accordance with GAAP to EBITDA is provided at the end of this news release.

Gross Revenues include sub-consultant costs and other direct costs which are generally pass-through costs and, therefore, the Company believes that Net Revenues, which is a non-GAAP financial measure commonly used in our industry, provides a meaningful perspective on its business results. A reconciliation of gross revenues as reported in accordance with GAAP to net revenues is provided at the end of this news release.

NV5's definition of Net Revenues and EBITDA may differ from other companies reporting similarly named measures. These measures should be considered in addition to, and not as a substitute for, or superior to, other measures of financial performance prepared in accordance with GAAP, such as contract revenues and net income.

Conference Call

NV5 will host a conference call to discuss its second quarter 2015 financial results at 4:30 p.m. (Eastern Time) on August 13, 2015.

Date: Thursday, August 13, 2015
Time: 4:30 p.m. Eastern time
Toll-free dial-in number: +1 877-407-3982
International dial-in number: +1 201-493-6780
Conference ID: 13614138
Webcast: http://ir.nv5.com

Please dial-in at least 5-10 minutes prior to the start time in order for the operator to log your name and connect you to the conference.

A replay of the conference call will be available approximately one hour following the conclusion of the call through August 20, 2015. To access the replay via telephone, please dial:

Toll-free replay number: +1 877-870-5176
International replay number: +1 858-384-5517
Replay PIN number: 13614138

The conference call will also be webcast live and available for replay via the investors section of the NV5 website, www.NV5.com.

About NV5

NV5 Holdings, Inc. (NASDAQ: NVEE) is a provider of professional and technical engineering and consulting solutions to public and private sector clients in the infrastructure, energy, construction, real estate and environmental markets. NV5 primarily focuses on five business verticals: construction quality assurance, infrastructure, engineering and support services, energy, program management, and environmental solutions. The Company operates 42 offices in Arizona, California, Colorado, Connecticut, Florida, Massachusetts, Maryland, New Jersey, New Mexico, New York, Ohio, Pennsylvania, Utah, Washington and Wyoming, and is headquartered in Hollywood, Florida. For additional information, please visit the Company's website at www.NV5.com. Also visit the Company on Twitter, LinkedIn, Facebook, and Vimeo.

Forward-Looking Statements

All statements other than statements of historical fact contained in this press release and on the conference call constitute "forward-looking statements" within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. The Company cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward-looking statements contained in this press release and on the conference call. Such factors include: (a) changes in demand from the local and state government and private clients that we serve; (b) general economic conditions, nationally and globally, and their effect on the market for our services; (c) competitive pressures and trends in our industry and our ability to successfully compete with our competitors; (d) changes in laws, regulations, or policies; and (e) the "Risk Factors" set forth in the Company's most recent SEC filings. All forward-looking statements are based on information available to the Company on the date hereof, and the Company assumes no obligation to update such statements, except as required by law.

 
NV5 HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except share data)
         
    June 30,
2015
  December 31,
2014
Assets   (Unaudited)    
Current assets:            
  Cash and cash equivalents   $ 33,833   $ 6,872
  Accounts receivable, net of allowance for doubtful accounts of $919 and $845 as of June 30, 2015 and December 31, 2014, respectively    
34,128
   
27,015
  Prepaid expenses and other current assets     1,135     1,224
  Deferred income tax assets     44     358
  Total current assets     69,140     35,469
  Property and equipment, net     2,476     1,625
  Intangible assets, net     9,630     5,221
  Goodwill     15,977     11,142
  Other assets     787     810
  Deferred income tax assets     -     1,123
    Total Assets   $ 98,010   $ 55,390
             
Liabilities and Stockholders' Equity            
Current liabilities:            
  Accounts payable   $ 3,251   $ 5,335
  Accrued liabilities     8,532     4,763
  Income taxes payable     839     1,157
  Billings in excess of costs and estimated earnings on uncompleted contracts     316     277
  Client deposits     109     121
  Current portion of contingent consideration     327     618
  Current portion of stock repurchase obligation     227     372
  Current portion of notes payable     6,541     2,878
  Total current liabilities     20,142     15,521
  Contingent consideration, less current portion     933     323
  Stock repurchase obligation, less current portion     531     563
  Notes payable, less current portion     3,923     3,378
    Total liabilities     25,529     19,785
             
Commitments and contingencies            
             
Stockholders' equity:            
  Preferred stock, $0.01 par value; 5,000,000 shares authorized, no shares issued and outstanding    
-
   
-
  Common stock, $0.01 par value; 45,000,000 shares authorized, 8,107,483 and 5,754,959 shares issued and outstanding as of June 30, 2015 and December 31, 2014, respectively    
81
   
58
  Additional paid-in capital     59,652     25,617
  Retained earnings     12,748     9,930
Total stockholders' equity     72,481     35,605
    Total liabilities and stockholders' equity   $ 98,010   $ 55,390
             
                         
NV5 HOLDINGS, INC. AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME  
(in thousands, except share data)  
(Unaudited)  
                         
    Three Months Ended     Six Months Ended  
    June 30,     June 30,     June 30,     June 30,  
    2015     2014     2015     2014  
                                 
Gross revenues   $ 34,481     $ 29,229     $ 63,634     $ 48,222  
                                 
Direct costs:                                
Salaries and wages     12,357       9,852       22,266       15,512  
Sub-consultant services     4,374       3,923       8,447       7,010  
Other direct costs     2,379       3,510       4,665       4,401  
Total direct costs     19,110       17,285       35,378       26,923  
                                 
Gross Profit     15,371       11,944       28,256       21,299  
                                 
Operating Expenses:                                
Salaries and wages, payroll taxes and benefits     7,604       6,237       14,709       11,323  
General and administrative     3,237       2,538       5,740       4,478  
Facilities and facilities related     1,007       906       1,864       1,679  
Depreciation and amortization     760       522       1,398       910  
Total operating expenses     12,608       10,203       23,711       18,390  
                                 
Income from operations     2,763       1,741       4,545       2,909  
                                 
Other expense:                                
Interest expense     (34 )     (77 )     (102 )     (129 )
Total other expense     (34 )     (77 )     (102 )     (129 )
                                 
Income before income tax expense     2,729       1,664       4,443       2,780  
Income tax expense     (996 )     (610 )     (1,625 )     (1,018 )
Net income and comprehensive income   $ 1,733     $ 1,054     $ 2,818     $ 1,762  
                                 
Earnings per share:                                
  Basic   $ 0.28     $ 0.21     $ 0.48       0.35  
  Diluted   $ 0.25     $ 0.19     $ 0.44       0.32  
                                 
Weighted average common shares outstanding:                                
  Basic     6,301,763       5,104,304       5,914,405       5,065,134  
  Diluted     6,838,725       5,612,344       6,437,546       5,502,696  
                                 
             
NV5 HOLDINGS, INC. AND SUBSIDIARIES  
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME  
(in thousands, except share data)  
(Unaudited)  
             
             
    Six Months Ended  
June 30,
2015
    June 30,
2014
 
Cash Flows From Operating Activities:                
Net income   $ 2,818     $ 1,762  
                 
Adjustments to reconcile net income to net cash provided by (used in) operating activities:                
  Depreciation and amortization     1,398       910  
  Provision for doubtful accounts     151       97  
  Stock compensation     666       347  
  Change in fair value of contingent consideration     52       24  
  Loss on disposal of leasehold improvements     -       32  
Changes in operating assets and liabilities, net of impact of acquisitions:                
  Accounts receivable     (3,564 )     (6,187 )
  Prepaid expenses and other assets     228       (514 )
  Accounts payable     (3,239 )     1,075  
  Accrued liabilities     2,805       523  
  Income taxes payable     (318 )     (369 )
  Billings in excess of costs and estimated earnings on uncompleted contracts     39       (79 )
  Client deposits     (11 )     (39 )
Net cash provided by (used in) operating activities     1,025       (2,418 )
                 
Cash Flows From Investing Activities:                
Cash paid for acquisitions     (2,764 )     (4,150 )
Purchase of property and equipment     (306 )     (470 )
Net cash used in investing activities     (3,070 )     (4,620 )
                 
Cash Flows From Financing Activities:                
Proceeds from secondary offering     32,068       -  
Payments of secondary offering costs     (2,646 )     -  
Payments on note payable     (2,676 )     (631 )
Payments of contingent consideration     (533 )     (233 )
Payments of debt issuance costs     -       (27 )
Proceeds from exercise of warrants     3,186       4  
Payment of warrants exercise costs     (216 )     -  
Payments on stock repurchase obligation     (177 )     (288 )
Net cash provided by (used in) financing activities     29,006       (1,175 )
                 
                 
Net increase (decrease) in Cash and Cash Equivalents     26,961       (8,213 )
Cash and cash equivalents - beginning of period     6,872       13,868  
Cash and cash equivalents - end of period   $ 33,833     $ 5,655  
                 
 
NV5 HOLDINGS, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)
(in thousands)
             
    Six Months Ended
    June 30,
2015
  June 30,
2014
Supplemental disclosures of cash flow information:            
Cash paid for interest   $ 142   $ 117
Cash paid for income taxes   $ 1,635   $ 1,387
             
Non-cash investing and financing activities:            
Contingent consideration (earn-out)   $ 901   $ 285
Notes and stock payable for acquisitions   $ 5,250   $ 3,845
Stock issuance for acquisitions   $ 900   $ 685
Payment of contingent consideration with common stock   $ 100   $ 100
Landlord-funded leasehold improvements   $ -   $ 137
             
 
NV5 HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GAAP NET INCOME TO EBITDA
(Unaudited)
(in thousands)
                   
      Three Months Ended   Six Months Ended
      June 30,   June 30,   June 30,   June 30,
      2015   2014   2015   2014
                           
Net Income and comprehensive income   $ 1,733   $ 1,054   $ 2,818   $ 1,762
                           
Add: Interest     34     77     102     129
  Tax     996     610     1,625     1,018
  Depreciation and Amortization     760     522     1,398     910
EBITDA   $ 3,523   $ 2,263   $ 5,943   $ 3,819
                         
 
NV5 HOLDINGS, INC. AND SUBSIDIARIES
RECONCILIATION OF GROSS REVENUES TO NET REVENUES
(Unaudited)
(in thousands)
                   
      Three Months Ended   Six Months Ended
      June 30,   June 30,   June 30,   June 30,
      2015   2014   2015   2014
                           
Gross revenues   $ 34,481   $ 29,229   $ 63,634   $ 48,222
                           
Less: Sub-consultant services     4,374     3,923     8,447     7,010
  Other direct costs     2,379     3,510     4,665     4,401
Net revenues   $ 27,728   $ 21,796   $ 50,522   $ 36,811
                         

Contact Information

  • Contact

    NV5 Holdings, Inc.
    Lauren Wright, Ph.D.
    Director of Investor Relations
    Tel: +1-408-392-7233
    Email: ir@nv5.com