Quanta Services, Inc.

Greetings and welcome to the Qantas Service third quarter 2023 earnings conference call. At this time, all participants are in a listen-only mode. A brief 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. It is now my pleasure to introduce your host, Kip Rupp, Vice President and Investor Relations. Thank you, Kip. You may begin.

Thank you and welcome everyone to the Qantas Services third quarter 2023 earnings conference call. This morning we issued a press release announcing our third 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, November 2nd, 2023, and therefore you are advised that any time-sensitive information may no longer be accurate as of any replay of this call. This call will include forward-looking 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 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'll 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'd like to be notified when Quanta publishes news releases and other information, please sign up for email alerts through the investor relations section of quantaservices.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 would now like to turn the call over to Mr. Duke Austin, Quanta's president and CEO. Duke?

Thanks, Kit. Good morning, everyone, and welcome to the Quanta Services third 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 third quarter results in full year 2023 financial expectations. Following Jayshree's comments, we welcome your questions. This morning, we reported our third quarter results, which included strong double-digit revenue growth and a number of record financial metrics. which we believe reflects robust demand for our services and solid execution. Of note, our electric power infrastructure solutions and renewable energy infrastructure solutions segments drove our revenue and profit growth, reflecting ongoing capital deployment into grid modernization and hardening, power grid expansion, and construction of new renewable generation and other necessary investments needed for North America's emerging energy transition. Total backlog at quarter end was $30.1 billion, an all-time record high, which we believe reflects the value of our collaborative client relationships and indicates momentum for 2024. We are positioning Quanta for decades of expected 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 most economically attractive and to achieve operating efficiencies and consistent financial results. Our electric power operations are performing well. Demand for our electric power infrastructure solutions is robust, 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. This is further evidenced by the meaningful increase in backlog for the segment in the third quarter. Accordingly, we continue to invest in resources ahead of the anticipated startup of multiple multi-year utility programs and projects. We believe Qantas Solutions' offering and ability to safely and consistently execute is industry-leading, and we are uniquely positioned to collaborate with our clients on their multi-year grid programs. Additionally, our communications operations continue to execute well with double-digit revenue growth and margins. We believe these results reflect our focus on being selective with the risk and margin profile of the work we pursue, as well as solid execution. Renewable infrastructure solution segment revenues increased significantly in the third quarter, as construction of renewable generation projects ramped up, including solar, wind, and battery storage. High voltage electric transmission and substation work also remained active. Segment total backlog reached a record $7.9 billion at quarter end, driven by the addition of a portion of the SUNZIA wind contract and various renewable generation transmission, and substation projects. We have mobilized resources for the SUNZIA projects and are performing early stage construction activities, though the vast majority of the work is expected to be performed in 2024 and 2025. We believe the infrastructure solutions we provide to the renewable industry are gaining momentum as the energy transition gains pace. We are continuing to make the necessary investments to scale our resources and capacity to handle large scale multi-year renewable programs that we expect will yield record levels of renewable generation over the coming decade, driven by the IRA and the acceleration of North America's energy transition. Additionally, we are pursuing billions of dollars of high voltage transmission projects that are designed to support connectivity of current and future renewable generation capacity growth, and overall system reliability. In this morning's earnings release, we also announced the strategic acquisition of Pennsylvania Transformer Technology, or PTT, led by an experienced management team with dedicated employees. PTT is an established and reliable domestic manufacturer of power transformers and components for the investor-owned electric utility, renewable energy, municipal power, and industrial markets. Transformers are a critical path of the power grid that facilitate the safe and efficient transmission of electricity from generators to end users. North America's energy transition and other megatrends that are driving current and anticipated future demand for our electric power and renewable energy solutions are also driving significant demand and growth for the transformer market. As a result, lead times are extended and demand and supply imbalances are only expected to intensify as energy intensive sectors such as electric vehicles, renewable energy, data centers, and manufacturing challenge power infrastructure capacity. As we have discussed previously, several years ago, Quantum began developing a strategy to create supply chain solutions that are designed to help our clients navigate equipment shortages and delays. reduce cost, improve availability, and enhance capital deployment efficiency, all of which can ultimately benefit the consumer. For Quanta, the addition of PTT should allow us to better manage the availability of certain critical grid components, which in turn should help us better manage our work schedules and productivity. We believe PTT provides Quanta and our clients an important, secure, and domestic supply chain solution that is consistent with our strategy. The strong and visible demand dynamics for transformer market provide a favorable long-term profitable growth opportunity for PTT. The company also possesses intellectual property for certain grade components not currently in its production, but that are also in high demand by the utility industry. As a part of Quanta, we believe there are opportunities to enhance and expand PTT's capacity and product offering, which could accelerate PTT's growth and provide incremental growth synergies for Quanta's electric power and renewable energy infrastructure solutions. The underground utility and infrastructure solution segment continues to deliver with double-digit revenue growth and solid profitability. Our industrial services operation executed well, and we had strong demand for our gas utility and pipeline integrity operations. Driven by regulated spin to modernize systems, reduce methane emissions, ensure environmental compliance, and improve safety and reliability. Additionally, we are increasingly leveraging our underground resources and capabilities to perform underground electric work. While that work is recognized in our electric power segment, it evidences the value and flexibility of our solutions portfolio. The transition towards a reduced carbon economy continues to progress and we believe is gaining momentum. We believe we're in early stages of capitalizing on significant opportunities across our service lines and geographies, driven by our collaborative, solution-based approach designed to ultimately benefit consumers. Additionally, the growth of programmatic spending with existing and new customers, as well as increased renewable generation activity and favorable megatrends, provide greater visibility into our near and long-term growth outlook. We are currently pacing ahead of long-term financial targets articulated at our investor day last year and are increasingly comfortable with our ability to achieve them. This belief is driven by the long-term programmatic spend of our customers and favorable long-term megatrend opportunities across our portfolio of services, which we believe are in the beginning stages of a multi-decade process. Quanta is investing in the future to meet the needs of our customers and take advantage of the visible opportunities ahead of us. which we believe positions us well for double-digit EPS growth in 2024 and beyond. 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 all our stakeholders. I will now turn the call over to Jayshree Desai, our CFO, for her review of our third quarter results and 2023 expectations. Jayshree.