Infrastructure and Energy Alternatives, Inc. Preannounces Pro Forma Full Year 2018 Results
IEA is pre-announcing its 2018 results to reflect the effect of multiple severe weather events on the Company’s wind business that began late in the third quarter and continued into the fourth quarter of last year. These weather conditions had a significant impact on the construction of six wind projects across
JP Roehm, Chief Executive Officer of IEA commented, “We are disappointed that extremely adverse weather conditions delayed construction progress in six of our nine wind projects late last year and materially reduced the anticipated revenue and Adjusted EBITDA for 2018 from our legacy wind business. We believe the impact of the weather on our business was intensified by our concentrated exposure to the wind market and the limited number of projects we had during the year. Going forward, the acquisitions in late 2018 of
Fourth Quarter and Full Year 2018 Results Conference Call Information
IEA plans to report fourth quarter and full year 2018 results as well as to further discuss the Company’s outlook for 2019 on
Reconciliation of Previous Fiscal Year 2018 Pro Forma Adjusted EBITDA Guidance to Current Fiscal Year 2018 Pro Forma Adjusted EBITDA Guidance
|Q4 2018 Combined Guidance|
|Previously announced Fiscal Year 2018 Pro Forma Adjusted EBITDA1||$||110,000||$||110,000|
|Weather related costs and related loss of gross margin||(35,000||)||(30,000||)|
|Fiscal Year 2018 Pro Forma Adjusted EBITDA, before anticipated future synergies||$||75,000||$||80,000|
|Additional operating lease conversions||5,000||5,000|
|Fiscal Year 2018 Pro Forma Adjusted EBITDA, after anticipated future synergies2||$||80,000||$||85,000|
1 This reconciliation reconciles the low end of the range of Company’s fiscal year 2018 guidance on Adjusted Pro Forma EBITDA previously announced in connection with the Company’s 2018 third quarter earnings release to the Company’s estimated pro forma Adjusted EBITDA for 2018.
IEA is a leading infrastructure construction company with specialized energy and heavy civil expertise. Headquartered in
Forward Looking Statements
This release contains forward-looking statements within the meaning of the “safe harbor” provisions of Section 27A of the Securities Act of 1933, as amended and Section 21E of the Securities Exchange Act of 1934, as amended. The use of words such as “anticipate,” “expect,” “could,” “may,” “intend,” “plan” and “believe,” among others, generally identify forward-looking statements. These forward-looking statements are based on currently available operating, financial, economic and other information, and are subject to a number of risks and uncertainties. Readers are cautioned that these forward-looking statements are only predictions and may differ materially from actual future events or results. A variety of factors, many of which are beyond our control, could cause actual future results or events to differ materially from those projected in the forward-looking statements in this release. These factors include the Company’s ability to identify acquisition candidates, integrate acquired businesses and realize upon the expected benefits of the acquisition of CCS and William Charles; consumer demand; our ability to grow and manage growth profitably; the possibility that we may be adversely affected by economic, business, and/or competitive factors; market conditions, technological developments, regulatory changes or other governmental policy uncertainty that affects us or our customers; our ability to manage projects effectively and in accordance with management estimates, as well as the ability to accurately estimate the costs associated with our fixed price and other contracts, including any material changes in estimates for completion of projects; the effect on demand for our services and changes in the amount of capital expenditures by customers due to, among other things, economic conditions, commodity price fluctuations, the availability and cost of financing, and customer consolidation; the timing and extent of fluctuations in geographic, weather and operational factors affecting our customers, projects and the industries in which we operate; the ability of customers to terminate or reduce the amount of work, or in some cases, the prices paid for services, on short or no notice; customer disputes related to the performance of services; disputes with, or failures of, subcontractors to deliver agreed-upon supplies or services in a timely fashion; our ability to replace non-recurring projects with new projects; the impact of U.S. federal, local, state, foreign or tax legislation and other regulations affecting the renewable energy industry and related projects and expenditures; the effect of state and federal regulatory initiatives, including costs of compliance with existing and future safety and environmental requirements; fluctuations in maintenance, materials, labor and other costs; and our beliefs regarding the state of the renewable wind energy market generally. For a full description of the risks and uncertainties which could cause actual results to differ from our forward-looking statements, please refer to IEA’s periodic filings with the
Non-U.S. GAAP Financial Measures
We define EBITDA as net income (loss), determined in accordance with GAAP, for the period presented, before depreciation and amortization, interest expense and provision (benefit) for income taxes. We define Adjusted EBITDA as net income (loss) plus depreciation and amortization, interest expense, provision (benefit) for income taxes, restructuring expenses, acquisition or disposition related expenses, non-cash stock compensation expense, and certain other non-cash charges, unusual, non-operating or non-recurring items and other items that we believe are not representative of our core business or future operating performance.
Adjusted EBITDA is a supplemental non-GAAP financial measure and, when considered along with other performance measures, is a useful measure as it reflects certain drivers of the business, such as revenue growth and operating costs. We believe Adjusted EBITDA can be useful in providing an understanding of the underlying operating results and trends and an enhanced overall understanding of our financial performance and prospects for the future. While Adjusted EBITDA is not a recognized measure under GAAP, management uses this financial measure to evaluate and forecast business performance. Adjusted EBITDA is not intended to be a measure of liquidity or cash flows from operations or a measure comparable to net income as it does not consider certain requirements, such as capital expenditures and related depreciation, principal and interest payments, and tax payments. Adjusted EBITDA is not a presentation made in accordance with GAAP, and our use of the term Adjusted EBITDA may vary from the use of similarly-titled measures by others in our industry due to the potential inconsistencies in the method of calculation and differences due to items subject to interpretation.
The presentation of non-GAAP financial information should not be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.
The following table outlines the reconciliation from 2019 projected net income (loss) to 2019 projected Adjusted EBITDA:
|For the projected year ended December 31, 2019|
|Interest expense, net||26,000||31,000|
|Provision for income taxes||2,200||4,300|
|Depreciation and amortization||49,000||55,100|
|Non-cash stock compensation expense (1)||4,000||4,400|
|Merger and Acquisitions costs (2)||2,800||3,600|
(1) Non-cash stock compensation expenses.
(2) Merger and acquisition costs include legal, consulting, travel and other costs associated with acquisition activity.
Source: Infrastructure and Energy Alternatives, Inc.