HOLLYWOOD, Fla., Nov. 02, 2023 (GLOBE NEWSWIRE) -- NV5 Global, Inc. (NASDAQ:NVEE) ("NV5" or the "Company"), a provider of technology, conformity assessment, consulting solutions, and software applications, today reported financial results for the third quarter ended September 30, 2023.

"NV5 delivered record revenues of $239 million in the third quarter of 2023, a 17% increase over the same period a year ago. Our geospatial business continued to build upon its strong performance in the first half of 2023 and we had strong performances by our clean energy, technology, data center, and international businesses. Our Red Technologies acquisition expanded our international footprint as we capitalized on the universal demand for data centers. The infrastructure business continues its acceleration throughout 2023, growing 6% compared to the second quarter of 2023 and 16% compared to the first quarter. We approach 2024 with a record backlog of $833 million and we are well-positioned to achieve our goal of a $1 billion revenue run rate by the end of next year." said Dickerson Wright, PE, Chairman and CEO of NV5.

Third Quarter 2023 Results

Gross revenues in the third quarter of 2023 were $239.3 million compared to $204.1 million in the third quarter of 2022, a 17% increase.
Positive trends in our organic growth.
Gross profit in the third quarter of 2023 was $115.4 million compared to $99.9 million in the third quarter of 2022, a 16% increase.
Net income in the third quarter of 2023 was $13.3 million compared to $16.1 million in the third quarter of 2022. Net income was impacted by increases in amortization from acquisitions, acquisition-related costs, interest expense, and income tax benefits, as well as lower margins in our LNG business, driven by project timing.
Adjusted EBITDA in the third quarter of 2023 was $37.8 million compared to $36.0 million in the third quarter of 2022, a 5% increase. Adjusted EBITDA was impacted by lower margins in our LNG business, driven by project timing.
GAAP EPS in the third quarter of 2023 was $0.86 per share compared to $1.05 per share in the third quarter of 2022. Diluted weighted average shares were 15,497,836 in the third quarter of 2023, compared to 15,301,545 in the third quarter of 2022.
Adjusted EPS in the third quarter of 2023 was $1.51 per share compared to $1.50 per share in the third quarter of 2022. Diluted weighted average shares were 15,497,836 in the third quarter of 2023, compared to 15,301,545 in the third quarter of 2022.

Nine Months Ended September 30, 2023 Results

Gross revenues for the nine months ended September 30, 2023 were $646.2 million compared to $597.0 million in the nine months ended October 1, 2022, an 8% increase.
Gross profit for the nine months ended September 30, 2023 was $321.7 million compared to $293.0 million in the nine months ended October 1, 2022, a 10% increase.
Net income for the nine months ended September 30, 2023 was $34.7 million compared to $42.0 million in the nine months ended October 1, 2022. Net income was impacted by increases in amortization from acquisitions, interest expense, and benefits from acquisition-related costs. Net income was also affected by lower margins in our LNG business, driven by project timing, and lower income from operations in our real estate transactional business.
Adjusted EBITDA for the nine months ended September 30, 2023 was $100.5 million compared to $102.7 million in the nine months ended October 1, 2022. Adjusted EBITDA was impacted by lower margins in our LNG business, driven by project timing, and lower income from operations in our real estate business.
GAAP EPS for the nine months ended September 30, 2023 was $2.24 per share compared to $2.75 per share in the nine months ended October 1, 2022. Diluted weighted average shares were 15,448,693 for the nine months ended September 30, 2023, compared to 15,242,453 in the nine months ended October 1, 2022.
Adjusted EPS for the nine months ended September 30, 2023 was $3.67 per share compared to $3.99 per share in the nine months ended October 1, 2022. Diluted weighted average shares were 15,448,693 for the nine months ended September 30, 2023, compared to 15,242,453 in the nine months ended October 1, 2022.

Full-Year Guidance

Gross revenues between $860 million and $868 million.
GAAP EPS between $2.80 per share and $3.17 per share.
Adjusted EPS between $4.79 per share and $5.16 per share.

Use of Non-GAAP Financial Measures; Comparability of Certain Measures

Earnings before interest, taxes, depreciation, and amortization ("EBITDA") is not a measure of financial performance under GAAP. Adjusted EBITDA reflects adjustments to EBITDA to eliminate stock-based compensation expense and acquisition-related costs. Management believes adjusted EBITDA, in addition to operating profit, Net Income, and other GAAP measures, is a useful indicator of our financial and operating performance and our 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 adjusted EBITDA is provided at the end of this news release.

Adjusted earnings per diluted share ("Adjusted EPS") is not a measure of financial performance under GAAP. Adjusted EPS reflects adjustments to reported diluted earnings per share ("GAAP EPS") to eliminate amortization expense of intangible assets from acquisitions, net of tax benefits, and acquisition-related costs. As we continue our acquisition strategy, the growth in Adjusted EPS may increase at a greater rate than GAAP EPS. A reconciliation of GAAP EPS to Adjusted EPS is provided at the end of this news release.

Our definition of Adjusted EBITDA and Adjusted EPS 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 Net Income and Diluted Earnings per Share. In addition, when presenting forward-looking non-GAAP metrics, we are unable to provide quantitative reconciliations to the most closely correlated GAAP measure due to the uncertainty in the timing, amount or nature of any adjustments, which could be material in any period.

Conference Call

NV5 will host a conference call to discuss its third quarter 2023 financial results at 4:30 p.m. (Eastern Time) on November 2, 2023. The accompanying presentation for the call is available by visiting http://ir.nv5.com.

Date:	Thursday, November 2, 2023
Time:	4:30 p.m. Eastern
Toll-free dial-in number:	+1 888-412-4117
International dial-in number:	+1 646-960-0284
Conference ID:	6172299
Webcast:	http://ir.nv5.com

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

The conference call will be webcast live and available for replay via the "Investors" section of the NV5 website.

About NV5

NV5 Global, Inc. (NASDAQ:NVEE) is a provider of technology, conformity assessment, and consulting solutions for public and private sector clients supporting sustainable infrastructure, utility, and building assets and systems. The Company focuses on multiple verticals: Construction quality assurance, infrastructure engineering, utility services, buildings & technology, environmental health sciences, and geospatial technology services to deliver innovative, sustainable solutions to complex issues and improve lives in our communities. NV5 operates out of more than 100 offices nationwide and internationally. For additional information, please visit the Company's website at www.NV5.com. Also visit the Company on LinkedIn, Twitter, Facebook, and Instagram.

Forward-Looking Statements

This news release contains "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 news 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.

Investor Relations Contact

NV5 Global, Inc.

Jack Cochran

Vice President, Marketing & Investor Relations

Tel: +1-954-637-8048

Email: ir@nv5.com

Source: NV5 Global, Inc.

NV5 GLOBAL, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except share data)

	September 30, 2023			December 31, 2022
Assets
Current assets:
Cash and cash equivalents	$	46,439		$	38,541
Billed receivables, net		166,859			145,637
Unbilled receivables, net		122,049			92,862
Prepaid expenses and other current assets		14,239			13,636
Total current assets		349,586			290,676
Property and equipment, net		49,930			41,640
Right-of-use lease assets, net		39,105			39,314
Intangible assets, net		236,433			160,431
Goodwill		527,030			400,957
Other assets		3,881			2,705
Total Assets	$	1,205,965		$	935,723

Liabilities and Stockholders' Equity

Current liabilities:
Accounts payable	$	67,144		$	57,771
Accrued liabilities		64,538			44,313
Billings in excess of costs and estimated earnings on uncompleted contracts		42,808			31,183
Other current liabilities		2,286			1,597
Current portion of contingent consideration		3,845			10,854
Current portion of notes payable and other obligations		12,989			15,176
Total current liabilities		193,610			160,894
Contingent consideration, less current portion		1,897			4,481
Other long-term liabilities		29,102			29,542
Notes payable and other obligations, less current portion		215,642			39,673
Deferred income tax liabilities, net		5,797			6,893
Total liabilities		446,048			241,483

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, 15,892,912 and 15,523,300 shares issued and outstanding as of September 30, 2023 and December 31, 2022, respectively		159			155
Additional paid-in capital		502,909			471,300
Accumulated other comprehensive income (loss)		(612	)		—
Retained earnings		257,461			222,785
Total stockholders' equity		759,917			694,240
Total liabilities and stockholders' equity	$	1,205,965		$	935,723

NV5 GLOBAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF NET INCOME AND COMPREHENSIVE INCOME (UNAUDITED) (in thousands, except share data)

	Three Months Ended						Nine Months Ended
	September 30, 2023			October 1, 2022			September 30, 2023			October 1, 2022
Gross revenues	$	239,287		$	204,075		$	646,242		$	596,960

Direct costs:
Salaries and wages		56,853			48,295			162,316			141,976
Sub-consultant services		45,522			41,253			112,827			116,557
Other direct costs		21,468			14,592			49,357			45,426
Total direct costs		123,843			104,140			324,500			303,959

Gross profit		115,444			99,935			321,742			293,001

Operating expenses:
Salaries and wages, payroll taxes, and benefits		60,262			49,670			171,883			146,719
General and administrative		20,257			16,730			49,728			47,611
Facilities and facilities related		6,011			5,441			17,208			15,822
Depreciation and amortization		13,840			9,771			38,426			29,373
Total operating expenses		100,370			81,612			277,245			239,525

Income from operations		15,074			18,323			44,497			53,476

Interest expense		(3,882	)		(1,003	)		(9,111	)		(2,804	)

Income before income tax benefit (expense)		11,192			17,320			35,386			50,672
Income tax benefit (expense)		2,124			(1,257	)		(710	)		(8,699	)
Net income	$	13,316		$	16,063		$	34,676		$	41,973

Earnings per share:
Basic	$	0.88		$	1.09		$	2.31		$	2.85
Diluted	$	0.86		$	1.05		$	2.24		$	2.75

Weighted average common shares outstanding:
Basic		15,210,100			14,768,689			15,035,898			14,732,726
Diluted		15,497,836			15,301,545			15,448,693			15,242,453

Comprehensive income:
Net income	$	13,316		$	16,063		$	34,676		$	41,973
Foreign currency translation losses, net of tax		(421	)		—			(612	)		—
Comprehensive income	$	12,895		$	16,063		$	34,064		$	41,973

NV5 GLOBAL, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands)

	Nine Months Ended
	September 30, 2023			October 1, 2022
Cash flows from operating activities:
Net income	$	34,676		$	41,973
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		42,498			33,091
Non-cash lease expense		10,346			9,409
Provision for doubtful accounts		940			1,252
Stock-based compensation		16,504			15,249
Change in fair value of contingent consideration		(7,518	)		(543	)
Gain on disposals of property and equipment		(633	)		(100	)
Deferred income taxes		(25,447	)		(4,288	)
Amortization of debt issuance costs		573			556
Changes in operating assets and liabilities, net of impact of acquisitions:
Billed receivables		(6,364	)		13,281
Unbilled receivables		(24,442	)		(8,633	)
Prepaid expenses and other assets		1,944			(8,105	)
Accounts payable		3,846			(7,937	)
Accrued liabilities and other long-term liabilities		1,243			(1,608	)
Billings in excess of costs and estimated earnings on uncompleted contracts		(2,113	)		(2,902	)
Contingent consideration		(1,307	)		—
Other current liabilities		689			(304	)
Net cash provided by operating activities		45,435			80,391

Cash flows from investing activities:
Cash paid for acquisitions (net of cash received from acquisitions)		(189,109	)		(5,020	)
Proceeds from sale of assets		295			87
Purchase of property and equipment		(14,257	)		(14,874	)
Net cash used in investing activities		(203,071	)		(19,807	)

Cash flows from financing activities:
Borrowings from Senior Credit Facility		188,000			—
Payments on notes payable		(6,399	)		(7,796	)
Payments of contingent consideration		(793	)		(1,597	)
Payments of borrowings from Senior Credit Facility		(15,000	)		(45,000	)
Purchases of common stock tendered by employees to satisfy the required withholding taxes related to stock-based compensation		(81	)		—
Net cash provided by (used in) financing activities		165,727			(54,393	)

Effect of exchange rate changes on cash and cash equivalents		(193	)		—

Net increase in cash and cash equivalents		7,898			6,191
Cash and cash equivalents – beginning of period		38,541			47,980
Cash and cash equivalents – end of period	$	46,439		$	54,171

NV5 GLOBAL, INC. AND SUBSIDIARIES

RECONCILIATION OF NON-GAAP FINANCIAL MEASURES

TO COMPARABLE GAAP FINANCIAL MEASURES

(UNAUDITED)

(in thousands)

RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA

		Three Months Ended					Nine Months Ended
		September 30, 2023			October 1, 2022		September 30, 2023			October 1, 2022
Net Income		$	13,316		$	16,063	$	34,676		$	41,973
Add:	Interest expense		3,882			1,003		9,111			2,804
	Income tax (benefit) expense		(2,124	)		1,257		710			8,699
	Depreciation and amortization		15,293			11,033		42,498			33,091
	Stock-based compensation		5,777			5,634		16,504			15,249
	Acquisition-related costs*		1,702			1,043		(2,959	)		892
Adjusted EBITDA		$	37,846		$	36,033	$	100,540		$	102,708

* Acquisition-related costs include contingent consideration fair value adjustments.

RECONCILIATION OF GAAP EPS TO ADJUSTED EPS

		Three Months Ended						Nine Months Ended
		September 30, 2023			October 1, 2022			September 30, 2023			October 1, 2022
Net Income - per diluted share		$	0.86		$	1.05		$	2.24		$	2.75
Per diluted share adjustments:
Add:	Amortization expense of intangible assets and acquisition-related costs		0.85			0.59			1.98			1.66
	Income tax expense		(0.20	)		(0.14	)		(0.55	)		(0.42	)
Adjusted EPS		$	1.51		$	1.50		$	3.67		$	3.99