Third Quarter Highlights

Contract revenues of $1.042 billion; 22.1% growth
Non-GAAP Adjusted EBITDA of $114.6 million
Net Income of $54.0 million, or $1.80 per common share diluted

PALM BEACH GARDENS, Fla., Nov. 22, 2022 (GLOBE NEWSWIRE) -- Dycom Industries, Inc. (NYSE:DY) announced today its results for the third quarter ended October 29, 2022. Contract revenues were $1.042 billion for the quarter ended October 29, 2022, compared to $854.0 million in the year ago period, an increase of 22.1%. Non-GAAP Adjusted EBITDA was $114.6 million, or 11.0% of contract revenues, for the quarter ended October 29, 2022, compared to $83.1 million, or 9.7% of contract revenues, in the year ago period.

Net income was $54.0 million, or $1.80 per common share diluted, for the quarter ended October 29, 2022, compared to $28.7 million, or $0.94 per common share diluted, in the year ago period. Results for the quarters ended October 29, 2022 and October 30, 2021 include income tax benefits of $3.2 million, or $0.11 per common share diluted, and $3.0 million, or $0.10 per common share diluted, respectively, for the vesting and exercise of share-based awards and for credits related to tax filings for prior years.

Year-to-Date Highlights

Contract revenues were $2.891 billion for the nine months ended October 29, 2022, compared to $2.369 billion for the nine months ended October 30, 2021. Contract revenues increased 22.2% organically after excluding $3.9 million of contract revenues from storm restoration services in the comparable year ago period. Non-GAAP Adjusted EBITDA was $283.0 million, or 9.8% of contract revenues, for the nine months ended October 29, 2022, compared to $201.0 million, or 8.5% of contract revenues, in the comparable year ago period.

Net income was $117.4 million, or $3.91 per common share diluted, for the nine months ended October 29, 2022. For the comparable year ago period, net income was $47.8 million, or $1.54 per common share diluted. Results for the nine months ended October 29, 2022 and October 30, 2021 include income tax benefits of $7.6 million, or $0.25 per common share diluted, and $5.8 million, or $0.19 per common share diluted, respectively, for the vesting and exercise of share-based awards and for credits related to tax filings for prior years.

During the nine months ended October 29, 2022, the Company purchased 304,030 shares of its own common stock in open market transactions for $28.5 million at an average price of $93.85 per share.

Outlook

The Company expects contract revenues for the quarter ending January 28, 2023 to increase by mid- to high-single digit as a percentage of contract revenues as compared to the quarter ended January 29, 2022. Non-GAAP Adjusted EBITDA as a percentage of contract revenues is expected to increase modestly for the quarter ending January 28, 2023 as compared to the quarter ended January 29, 2022. For additional information regarding the Company's outlook, please see the presentation materials available on the Company's website posted in connection with the conference call discussed below.

Use of Non-GAAP Financial Measures

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). In quarterly results releases, trend schedules, conference calls, slide presentations, and webcasts, the Company may use or discuss Non-GAAP financial measures, as defined by Regulation G of the Securities and Exchange Commission. See Reconciliation of Non-GAAP Financial Measures to Comparable GAAP Financial Measures in the press release tables that follow.

Conference Call Information and Other Selected Data

The Company will host a conference call to discuss fiscal 2023 third quarter results on Tuesday, November 22, 2022 at 9:00 a.m. Eastern time. Interested parties may participate in the question and answer session of the conference call by registering at https://register.vevent.com/register/BI0369368b0c7644b086408460275d7ef8. Upon registration, participants will receive a dial-in number and unique PIN to access the call. Participants are encouraged to join approximately ten minutes prior to the scheduled start time.

For all other attendees, a live listen-only audio webcast of the call, including an accompanying slide presentation, can be accessed directly at https://edge.media-server.com/mmc/p/z2ivk522. A replay of the live webcast and the related materials will be available on the Company's Investor Center website at https://ir.dycomind.com for approximately 120 days following the event.

About Dycom Industries, Inc.

Dycom is a leading provider of specialty contracting services throughout the United States. These services include program management; planning; engineering and design; aerial, underground, and wireless construction; maintenance; and fulfillment services for telecommunications providers. Additionally, Dycom provides underground facility locating services for various utilities, including telecommunications providers, and other construction and maintenance services for electric and gas utilities.

Forward Looking Information

This press release contains forward-looking statements within the meaning of the 1995 Private Securities Litigation Reform Act. These forward-looking statements include those related to the outlook for the quarter ending January 28, 2023, including, but not limited to, those statements found under the "Outlook" section of this press release. Forward-looking statements are based on management's expectations, estimates and projections, are made solely as of the date these statements are made, and are subject to both known and unknown risks and uncertainties that may cause the actual results and occurrences discussed in these forward-looking statements to differ materially from those referenced or implied in the forward-looking statements contained in this press release. The most significant of these known risks and uncertainties are described in the Company's Form 10-K, Form 10-Q, and Form 8-K reports (including all amendments to those reports) and include future economic conditions and trends including the potential impacts of an inflationary economic environment, customer capital budgets and spending priorities, the availability and cost of materials, equipment and labor necessary to perform our work, the adequacy of the Company's insurance and other reserves and allowances for doubtful accounts, whether the carrying value of the Company's assets may be impaired, the future impact of any acquisitions or dispositions, adjustments and cancellations of the Company's projects, the impact to the Company's backlog from project cancellations or postponements, the impact of the COVID-19 pandemic, the impact of varying climate and weather conditions, the anticipated outcome of other contingent events, including litigation or regulatory actions involving the Company, the adequacy of our liquidity, the availability of financing to address our financial needs, the Company's ability to generate sufficient cash to service its indebtedness, the impact of restrictions imposed by the Company's credit agreement, and other risks and uncertainties detailed from time to time in the Company's filings with the Securities and Exchange Commission. The Company does not undertake any obligation to update its forward-looking statements.

For more information, contact:

Callie Tomasso, Investor Relations

Email: investorrelations@dycomind.com

Phone: (561) 627-7171

---Tables Follow---


DYCOM INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(Dollars in thousands)
Unaudited

	October 29, 2022		January 29, 2022
ASSETS
Current assets:
Cash and equivalents	$	65,285	$	310,757
Accounts receivable, net		1,244,482		895,898
Contract assets		53,319		24,539
Inventories		107,135		81,291
Income tax receivable		—		12,729
Other current assets		42,797		30,876
Total current assets		1,513,018		1,356,090

Property and equipment, net		337,175		294,798
Operating lease right-of-use assets		66,083		61,101
Goodwill and other intangible assets, net		362,623		374,317
Other assets		26,397		31,918
Total assets	$	2,305,296	$	2,118,224

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable	$	200,980	$	155,896
Current portion of debt		17,500		17,500
Contract liabilities		14,419		18,512
Accrued insurance claims		41,594		36,805
Operating lease liabilities		26,522		24,641
Income taxes payable		9,585		233
Other accrued liabilities		160,500		128,209
Total current liabilities		471,100		381,796

Long-term debt		811,350		823,251
Accrued insurance claims - non-current		48,719		48,238
Operating lease liabilities - non-current		39,513		36,519
Deferred tax liabilities, net - non-current		59,416		55,674
Other liabilities		16,582		14,202
Total liabilities		1,446,680		1,359,680

Total stockholders' equity		858,616		758,544
Total liabilities and stockholders' equity	$	2,305,296	$	2,118,224

DYCOM INDUSTRIES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollars in thousands, except share amounts)
Unaudited

	Quarter			Quarter			Nine Months			Nine Months
	Ended			Ended			Ended			Ended
	October 29, 2022			October 30, 2021			October 29, 2022			October 30, 2021
Contract revenues	$	1,042,423		$	853,973		$	2,890,996		$	2,369,038

Costs of earned revenues, excluding depreciation and amortization		850,897			705,865			2,394,606			1,977,243
General and administrative¹		78,798			66,899			221,514			198,640
Depreciation and amortization		35,454			37,766			107,436			115,307
Total		965,149			810,530			2,723,556			2,291,190

Interest expense, net		(10,592	)		(9,132	)		(29,057	)		(24,343	)
Loss on debt extinguishment²		—			—			—			(62	)
Other income, net		2,474			564			9,856			4,267
Income before income taxes		69,156			34,875			148,239			57,710

Provision for income taxes³		15,144			6,158			30,835			9,930

Net income	$	54,012		$	28,717		$	117,404		$	47,780

Earnings per common share:

Basic earnings per common share	$	1.83		$	0.95		$	3.97		$	1.57

Diluted earnings per common share	$	1.80		$	0.94		$	3.91		$	1.54

Shares used in computing earnings per common share:

Basic		29,524,516			30,172,254			29,561,172			30,426,337

Diluted		29,978,795			30,614,706			30,007,257			30,928,890

DYCOM INDUSTRIES, INC. AND SUBSIDIARIES
RECONCILIATION OF NON-GAAP FINANCIAL MEASURES TO COMPARABLE GAAP FINANCIAL MEASURES
(Dollars in thousands)
Unaudited

CONTRACT REVENUES, NON-GAAP ORGANIC CONTRACT REVENUES, AND GROWTH %'s

	Quarter			Quarter		Nine Months			Nine Months
	Ended			Ended		Ended			Ended
	October 29, 2022			October 30, 2021		October 29, 2022			October 30, 2021
Contract Revenues - GAAP	$	1,042,423		$	853,973	$	2,890,996		$	2,369,038
Contract Revenues - GAAP Organic Growth %		22.1	%				22.0	%

Contract Revenues - GAAP	$	1,042,423		$	853,973	$	2,890,996		$	2,369,038
Revenues from storm restoration services		—			—		—			(3,869	)
Non-GAAP Organic Contract Revenues	$	1,042,423		$	853,973	$	2,890,996		$	2,365,169
Non-GAAP Organic Contract Revenues Growth %		22.1	%				22.2	%


NET INCOME AND NON-GAAP ADJUSTED EBITDA

	Quarter			Quarter			Nine Months			Nine Months
	Ended			Ended			Ended			Ended
	October 29, 2022			October 30, 2021			October 29, 2022			October 30, 2021
Reconciliation of net income to Non-GAAP Adjusted EBITDA:
Net income	$	54,012		$	28,717		$	117,404		$	47,780
Interest expense, net		10,592			9,132			29,057			24,343
Provision for income taxes		15,144			6,158			30,835			9,930
Depreciation and amortization		35,454			37,766			107,436			115,307
Earnings Before Interest, Taxes, Depreciation & Amortization ("EBITDA")		115,202			81,773			284,732			197,360
Gain on sale of fixed assets		(5,135	)		(415	)		(13,991	)		(4,259	)
Stock-based compensation expense		4,515			1,789			12,273			7,838
Loss on debt extinguishment²		—			—			—			62
Non-GAAP Adjusted EBITDA	$	114,582		$	83,147		$	283,014		$	201,001
Non-GAAP Adjusted EBITDA % of contract revenues		11.0	%		9.7	%		9.8	%		8.5	%

DYCOM INDUSTRIES, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

TO COMPARABLE GAAP FINANCIAL MEASURES (CONTINUED)

Explanation of Non-GAAP Financial Measures

The Company reports its financial results in accordance with U.S. generally accepted accounting principles (GAAP). In the Company's quarterly results releases, trend schedules, conference calls, slide presentations, and webcasts, it may use or discuss Non-GAAP financial measures, as defined by Regulation G of the Securities and Exchange Commission. The Company believes that the presentation of certain Non-GAAP financial measures in these materials provides information that is useful to investors because it allows for a more direct comparison of the Company's performance for the period reported with the Company's performance in prior periods. The Company cautions that Non-GAAP financial measures should be considered in addition to, but not as a substitute for, the Company's reported GAAP results. Management defines the Non-GAAP financial measures used as follows:

Non-GAAP Organic Contract Revenues - contract revenues from businesses that are included for the entire period in both the current and prior year periods, excluding contract revenues from storm restoration services. Non-GAAP Organic Contract Revenue change percentage is calculated as the change in Non-GAAP Organic Contract Revenues from the comparable prior year period divided by the comparable prior year period Non-GAAP Organic Contract Revenues. Management believes Non-GAAP Organic Contract Revenues is a helpful measure for comparing the Company's revenue performance with prior periods. For comparison purposes, Lumen's Non-GAAP Organic Contract Revenue and Non-GAAP Organic Contract Revenue Growth percentage excludes the estimated contract revenues for the quarters ended October 29, 2022 and October 30, 2021 related to the ILEC (incumbent local exchange carrier) business in 20 states it sold to Brightspeed on October 3, 2022.
Non-GAAP Adjusted EBITDA - net income before interest, taxes, depreciation and amortization, gain on sale of fixed assets, stock-based compensation expense, and certain non-recurring items. Management believes Non-GAAP Adjusted EBITDA is a helpful measure for comparing the Company's operating performance with prior periods as well as with the performance of other companies with different capital structures or tax rates.

Notes

¹ Includes stock-based compensation expense of $4.5 million and $1.8 million for the quarters ended October 29, 2022 and October 30, 2021, respectively, and $12.3 million and $7.8 million for the nine months ended October 29, 2022 and October 30, 2021, respectively.

² During the nine months ended October 30, 2021, the Company recognized a loss on debt extinguishment of $0.1 million in connection with the amendment and restatement of its credit agreement maturing in April 2026.

³Results include income tax benefits of $3.2 million, or $0.11 per common share diluted, and $3.0 million, or $0.10 per common share diluted for the quarters ended October 29, 2022 and October 30, 2021, respectively, for the vesting and exercise of share-based awards and for credits related to tax filings for prior years.

Results for the nine months ended October 29, 2022 and October 30, 2021 include income tax benefits of $7.6 million, or $0.25 per common share diluted, and $5.8 million, or $0.19 per common share diluted, respectively, for the vesting and exercise of share-based awards and for credits related to tax filings for prior years.

Dycom Industries, Inc. Announces Fiscal 2023 Third Quarter Results