NV5 Global Inc is a provider of technology, conformity assessment, and consulting solutions to public and private sector clients in the infrastructure, utility services, construction, real estate, environmental, and geospatial markets, operating nationwide and abroad. The Company's clients include the U.S. Federal, state and local governments, and the private sector. The operating business segments are Infrastructure, Building, Technology & Sciences, and Geospatial Solutions. The maximum revenue derives from the infrastructure segment.
Second Quarter 2024 Results
NV5 Global Inc (NVEE, Financial) reported gross revenues of $236.3 million for the second quarter of 2024, a 6% increase from $222.6 million in the same quarter of 2023. This figure surpassed the analyst estimate of $235.57 million. Gross profit also saw a significant rise, increasing by 12% to $123.3 million, resulting in a gross margin expansion of 270 basis points to 52.2%.
However, net income for the quarter was $7.9 million, down from $15.4 million in the second quarter of 2023. This decline was attributed to integration costs of the VIS acquisition and a $6.7 million reversal of contingent consideration in the previous year. Additionally, higher interest expenses of $1.0 million due to increased interest rates and debt balances impacted the net income. Consequently, GAAP EPS for the quarter was $0.50 per share, falling short of the analyst estimate of $0.67 per share and down from $1.00 per share in the same period last year.
Adjusted Financial Metrics
NV5 Global Inc (NVEE, Financial) reported an Adjusted EBITDA of $38.5 million, a 10% increase from $35.0 million in the prior year quarter. The Adjusted EBITDA margin expanded to 16.3% from 15.7%. Adjusted EPS for the quarter was $1.24 per share, slightly down from $1.29 per share in the second quarter of 2023, reflecting a higher share count.
Raising Full-Year Guidance
NV5 Global Inc (NVEE, Financial) has raised its full-year 2024 guidance for revenue and Adjusted Earnings per Share. The company now expects gross revenue to be between $944 million and $950 million, up from the previous range of $937 million to $942 million. The 2024 Adjusted EPS guidance has been increased to $5.13 to $5.20 per share, from the earlier range of $5.05 to $5.11 per share. The GAAP EPS guidance remains unchanged at $2.87 to $2.93 per share.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Gross Revenues | $236.3 million | $222.6 million |
| Gross Profit | $123.3 million | $110.3 million |
| Net Income | $7.9 million | $15.4 million |
| GAAP EPS | $0.50 | $1.00 |
| Adjusted EBITDA | $38.5 million | $35.0 million |
| Adjusted EPS | $1.24 | $1.29 |
Analysis and Commentary
NV5 Global Inc (NVEE, Financial) continues to demonstrate robust revenue growth, driven by its diversified service offerings and strategic acquisitions. The company's ability to expand its gross margin and Adjusted EBITDA margin highlights its operational efficiency and effective cost management. However, the decline in net income and GAAP EPS underscores the impact of acquisition-related costs and higher interest expenses.
NV5 continued to build upon its positive momentum in the second quarter, delivering strong organic growth and profitability. We are well-positioned to meet the expected increase in demand for our services in the second half of 2024, and we are raising guidance," said Dickerson Wright, Executive Chairman of NV5.
Overall, NV5 Global Inc (NVEE, Financial) remains a strong player in the technology and consulting solutions sector, with a positive outlook for the remainder of 2024. Investors should monitor the company's ability to manage acquisition costs and interest expenses while capitalizing on growth opportunities in its core markets.
Explore the complete 8-K earnings release (here) from NV5 Global Inc for further details.
