MasTec, Inc.

Welcome to Mass Tech's first quarter 2024 earnings conference call, initially broadcast on Friday, May 3rd, 2024. Let me remind participants that today's call is being recorded. At this time, I'd like to turn the call over to our host, Mark Lewis, Mass Tech's Vice President of Investor Relations. Mark?

Thanks, Maddie, and good morning, everyone. Welcome to Mass Tech's first quarter call. The following statement is made pursuant to the safe harbor for forward-looking statements described in the Private Securities Litigation Reform Act of 1995. In these communications, we may make certain statements that are forward-looking, such as statements regarding MOSDEC's future results, plans, and anticipated trends in the industries where we operate. These forward-looking statements are the company's expectations on the day of the initial broadcast of this conference call, and the company does not undertake to update these expectations based on subsequent events or knowledge. Various risks, uncertainties, and assumptions are detailed in our press releases and filings with the SEC. Should one or more of our risks or uncertainties materialize, or should any of our underlying assumptions prove incorrect, actual results may differ significantly from results expressed or implied in this call. In today's remarks by management, we will be discussing adjusted financial metrics reconciled in yesterday's press releases and supporting schedules. In addition, we may use certain non-GAAP financial measures in this call. A reconciliation of any non-GAAP financial measures not reconciled in these comments to the most comparable GAAP measure can be found in our earnings press release. Please note that we have two additional documents associated with today's webcast, which along with our earnings press release can be found on the investors' events and presentations page of our website at mystack.com. There is a companion presentation with information and analytics on the quarter you're standing in and a guidance summary to assist in developing your financial models going forward. Both PDF files are available for download. With us today, we have Jose Mas, our CEO, and Paul DeMarco, our EVP and Chief Financial Officer. The format of the call will be opening remarks and analysis by Jose, followed by a detailed financial review from Paul. The discussion will be followed by a question and answer period, and we expect the call to last about 60 minutes. We have a lot of important things to talk about today, so I'll turn the call over to Jose so we can get going.

Jose? Thanks, Mark. Good morning and welcome to MOSTECH's 2024 first quarter call. Today I'll be reviewing our first quarter results as well as providing my outlook for the markets we serve. First, some first quarter highlights. Revenue for the quarter was $2,687,000,000, up 4% organically year-over-year. Adjusted EBITDA was $157,000,000, a 54% year-over-year increase. Adjusted earnings per share was negative 13 cents, 35 cents better than consensus. And backlog of quarter end was 12.8 billion, a 430 million sequential increase. In summary, results were better than guidance across all segments. I'm proud to say this was a very clean quarter. Segments performed as expected or better, and cash flow as expected was strong. I think this is an excellent indication of what we expect for the balance of the year. I'd like to walk through a number of positive developments that I believe will have a significant impact on our ability to grow both revenue and earnings. As we announced on our last call, in our communications segment, we significantly expanded our relationship with our biggest customer, AT&T. AT&T expanded both our scope and geographic territory on our core wireless work. This expansion, coupled with their announcement of a complete swap out of Nokia equipment to Ericsson equipment over a five-year period, is expected to significantly increase our wireless business over the next few years. While we'll see some impact during the first half of this year, it will mostly be site acquisition and engineering work. The work we are doing now is what is creating workable backlog for the second half of the year, so our visibility is excellent. In addition, we continue to see very strong demand for our wireline services. We expanded our customer base during the first quarter and are very encouraged about the optimism of our customers related to BEADS funding. Demand for connectivity and information requires a significant investment in our nation's broadband infrastructure. The advancement of data collection requires networks with low latency and high speed. We're also encouraged about T-Mobile's recent announcement of its investment in fiber infrastructure. Through a joint venture, T-Mobile will be an anchor tenant and investor in a large nationwide fiber network. This transaction demonstrates the importance of carriers owning and controlling their infrastructure as demand for moving data significantly increases. Our communications backlog total reached a record level in the first quarter and we're off to a great start this year. Our oil and gas pipeline segment overperformed as revenues and EBITDA both came in higher than estimates. While Paul will cover later, we've increased our full year expectations for this segment for both revenue and EBITDA. While backlog is down, demand is actually very strong. We expect this segment to return to a more book and burn cadence as it relies less on larger projects. We are confident in the visibility we have in this segment for the next few years and we've been surprised with the potential that gas fire generation has relative to powering industrial and manufacturing facilities as well as data centers. Having good visibility over a multi-year time frame is very different than where we've been in the last few years and it gives us a lot of confidence in our business. In power delivery, Conversations throughout the quarter centered around the long-term expected load growth our customers are beginning to experience. With the level of activity being experienced by industrial and manufacturing growth coupled with the proliferation of data centers, the ability to power these facilities is becoming the most important issue. While we've talked about some short-term pressure as utility customers manage their distribution transmission budgets based on need and the regulatory environment, our expectation is there is a need for significant investment in our country's electrical grid to meet the growing demand. We have seen a significant uptick in transmission-related opportunities and expect that trend to continue. Backlog in this segment was up slightly sequentially, and we expect strong backlog growth for the balance of the year. Finally, in our clean energy and infrastructure segment, margins were in line with our expectations for the first quarter. Backlog was up about $400 million sequentially, and projects under limited notice to proceed exceeded $2 billion, much of which we expect to convert to backlog in the coming quarters. Renewable demand is very strong, and our visibility is greatly improved versus last year. Renewables will be a key driver of added generation to help meet the needs of our country's load growth, and we believe we are very well positioned to take advantage of this growth. I've talked about load growth a lot today, and obviously one of the drivers of that is the expected growth of the data center market. While data centers will create significant opportunities for us in both our clean energy and power delivery segments in the form of increased renewables, transmission, substation, and battery storage, data centers will also have a positive impact on our communications business as more data is transmitted. But what we didn't expect was the potential that data centers have on our infrastructure business. As a reminder, with the combination of IEA and MOSTEC's legacy infrastructure business, MOSTEC has significant geographic diversity in the civil space. We spent a lot of time understanding the needs of data center builders and the potential opportunity that exists for MOSTEC. To date, we've actually completed over $150 million in data center infrastructure work, and currently have approximately $200 million in backlog to complete. In addition, we have approximately $1 billion in identified RFPs we expect to bid this year. While we won't win it all, we believe we are uniquely positioned to provide data center builders with a package that includes assistance on connecting to the power grid, infrastructure required for communications, and site and civil work on the front end of their build-outs. While we're still early in understanding the full potential of this opportunity, we recognize the potential impact. In summary, I strongly believe that the investments we've made in the last few years to build scale along our vertical offerings will translate to not only strong levels of revenue growth, but the ability to meaningfully improve margins. I want to emphasize that thought. I believe the most successful companies in our space are those that have the scale to meet our customers' demands. Our customers' projects have significantly increased in size, scope, and complexity, and there is no question that our customers want to simplify and work with less partners. I believe that over the last few years, our biggest accomplishment has been to position ourselves as one of only a few partners that's viewed throughout our industry as a partner whose workforce, size, and scale affords it the capabilities to take on any project. While I'm proud of that accomplishment, I also understand the need for this advantageous positioning to be reflected in our financial results. While I'm optimistic that today's results begin to demonstrate this, I also recognize we have great potential to improve margins. I'm excited to see what the future holds for MOSTEC. I'd like to take this opportunity to thank the men and women of MOSTEC. I'm honored and privileged to lead such a great group. The men and women of MOSTEC are committed to the values of safety, environmental stewardship, integrity, honesty, and in providing our customers a great quality project at the best value. These traits have been recognized by our customers, and it's because of our people's great work that we've been able to position ourselves for continued growth and success. I'll now turn the call over to Paul for our financial review. Paul? Thank you, Jose, and good morning, everyone.