Quanta Services, Inc.

Greetings and welcome to the Qantas Services second quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Kip Rupp, Vice President of Investor Relations. Please go ahead.

Thank you and welcome everyone to the Qantas Services second quarter 2023 earnings conference call. This morning we issued a press release announcing our second quarter 2023 results, which can be found in the investor relations section of our website at QantasServices.com, along with a summary of our 2023 outlook and commentary that we will discuss this morning. Additionally, we'll use a slide presentation this morning to accompany our prepared remarks which is viewable through the call's webcast and is also available on the investor relations section of the Quantum Services website. Please remember that information reported on this call speaks only as of today, August 3rd, 2023, and therefore you advise that any time-sensitive information may no longer be accurate as of any replay of this call. This call will include four linking statements intended to qualify under the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995 including all statements reflecting expectations, intentions, assumptions, or beliefs about future events or performance, but that do not solely relate to historical or current facts. You should not place undue reliance on these statements as they involve certain risks, uncertainties, and assumptions that are difficult to predict or beyond QANU's control, and actual results may differ materially from those expressed or implied. We also present certain historical and forecasted non-GAAP financial measures, Reconciliations of these financial measures to their most directly comparable GAAP financial measures are included in our earnings release and slide presentation. Please see slide two and the appendix of the slide presentation for additional information regarding our forward-looking statements and non-GAAP financial measures. Lastly, if you would like to be notified when Qantas Services publishes news releases and other information, please sign up for email alerts through the investor relations section of QantasServices.com. We also encourage investors and others interested in our company to follow Quanta IR and Quanta Services on the social media channels listed on our website. With that, I'll now turn the call over to Duke Austin, Quanta's president and CEO. Duke.

Thanks, Kip. Good morning, everyone, and welcome to the Quanta Services second quarter 2023 earnings conference call. On the call today, I will provide operational and strategic commentary and will then turn it over to Jayshree Desai, on a CFO to provide a review of our second quarter results in full year 2023 financial expectations. Following Jay Street's comments, we welcome your questions. Our second quarter results continue our solid start to the year with strong double-digit revenue growth that resulted in record quarterly revenues exceeding $5 billion for the first time in our history, as well as a record total backlog of $27.2 billion. We added approximately 3,000 employees during the second quarter due to the building momentum and increasing demand for our infrastructure solutions. We are investing in safety and training programs for our employees, expanding various service lines, and advancing our supply chain and other solutions. We are positioning Quanta for decades as necessary infrastructure investment and continue to believe our operational portfolio is a strategic advantage that provides us the ability to manage risk and shift resources across service lines and geographies, which we believe will become increasingly important as the energy transition accelerates. We believe our portfolio approach positions us well to allocate resources to the opportunities we find the most economically attractive and to achieve operating efficiencies and consistent financial results. Our electric power operations are performing well overall though segment margins experience some pressure from lower utilizations in Canada. Demand for our electric power infrastructure solutions is strong, driven by broad-based business activity from utility grid modernization, grid security, and system hardening initiatives, as well as our reputation for consistent and safe execution. Accordingly, we are investing in resources ahead of the anticipated startup of multiple multi-year utility programs and projects. Additionally, our communications operations continue to execute well from both a revenue and margins perspective. Going forward, our utility customers' multi-year CapEx plans remain strong, and we are having discussions with a number of them about capital plans and programs looking out 10 years. North America's power grid continues to be challenged by a number of demands, including the need to increase the pace of modernization and increase the grid's resiliency and reliability through system hardening, enabling new technologies, facilitating higher levels of electric vehicle penetration, meeting growing power load demand, and capitalizing on favorable federal and state policies designed to accelerate the energy transition. We believe Qantas Solutions' offering and ability to safely, consistently execute is industry-leading. We are uniquely positioned to collaborate with our clients on their multi-year grid operations. Renewable infrastructure solution segment revenues increased significantly in the quarter as construction of renewable generation projects within the multi-year programs ramped up and high voltage electric transmission and substation work remained active. Segment total backlog reached a record $7 billion at quarter end, driven by the addition of SunZia transmission and HPDC converter station contracts and various renewable generation transmission and substation projects. We believe the momentum in this segment will continue, and we are making the necessary investments to scale our resources and capacity to handle multi-year renewable programs that we expect will yield record levels of new renewable generation over the coming decade, driven by the RA and acceleration of North America's energy transition. Additionally, we are pursuing billions of dollars of high-voltage transmission projects that are designed to support current and future renewable generation capacity growth and overall system reliability. As we have discussed on prior earning calls and reported more recently in the media, federal and state policies designed to accelerate the energy transition and the electrification of everything are expected to significantly increase load demand and are already pressuring the power grid. At the same time, there are significant challenges to getting regional transmission infrastructure built in a timely manner, primarily due to obtaining necessary environmental permits and regulatory approvals. The need for collaboration at all levels to ensure grid reliability while minimizing cost impacts to the ratepayer remains the industry's greatest challenge. We remain pleased with the performance of our underground utility and infrastructure solution segment, which delivered double-digit revenue growth record second quarter profitability demonstrating solid execution across our operations in the segment our industrial services operations executed well and we had strong demand for our gas utility and pipeline integrity integrity operations driven by regulated spend and modernized systems reduce methane emissions ensure environmental compliance and improve safety and reliability We believe we're in the early stages of capitalizing on significant opportunities across our service lines and geographies, which are driven by our collaborative solution-based approach that is designed to ultimately benefit consumers. Additionally, the growth of programmatic spending with existing and new customers, increased renewable generation activity, and favorable megatrends provide greater visibility into our near and long-term growth outlook. As a result of these dynamics in our solid year-to-date financial performance, we have increased our full year 2023 financial expectations for revenues, adjusted EBITDA, and adjusted EPS. The energy transition towards a reduced carbon economy continues to progress and we believe is gaining pace. Quanta is successfully executing on our strategic initiatives to drive sustainable and resilient operational excellence, total cost solutions for our clients, and consistent profitable growth. We are focused on operating the business for the long term and expect to continue to distinguish ourselves through safe execution and best-in-class field leadership. We will pursue opportunities to enhance Qantas-based business and leadership position in the industry and provide innovative solutions to our customers. We believe Qantas' diversity, unique operating model, and entrepreneurial mindset form the foundation that will allow us to continue to generate long-term value for our stakeholders. I will now turn the call over to Jayshree Desai, our CFO, for her review of the second quarter results and 2023 expectations. Jayshree.