Primoris Services (PRIM) 9 Aug 222022 Q2 Earnings call transcript

Hello. My name is Lisa, and I will be your conference operator today. At this time, I would like to welcome everyone to the Primoris Services Corporation Second Quarter 2022 Earnings Conference Call and Webcast. [Operator Instructions]. Thank you. to call like to now would turn over the Mr. I Apple. Jeremy ahead, Please go sir.

welcome Quarter Primoris' Call. morning, to Good and Second XXXX Conference Earnings

Joining Financial McCormick, and Tom me Chief today Officer; Executive President Ken Officer. and Chief Dodgen, are

differ Before Actual company of our language from aware risks make subject materially certain forward-looking certain that various I results statements we and statements. this contained to filed The and discussed and call would are with begin, projections harbor to expectations. everyone uncertainties like SEC. and safe may in cautions in uncertainties. made reports risks our our during the are These are

required our to by Our represent outlook forward-looking obligation as disclaim update of statements except today. statements any be law. We these only may as

In of make available conference would website. financial non-GAAP addition, certain non-GAAP of will Tom? section A are now financial to to measures the call, Relations to our we measures. Investor call reference reconciliation over these turn Tom I McCormick. like the this on during

pleased generated morning, Jeremy. the highest outlook XXXX our report This joining for today us along you, you quarter I all revenue we in Primoris' was and discuss Thank quarter year. am the in our that updated to results for $X.XX with financial billion second thank the to quarter. Good history.

quarters We the of continue we as revenue progress expect to be strategic billion-dollar-plus to this many our objectives. first

was an XX% our the Pipeline backlog strength Over We by quarter our for offset prior and Utilities led year Our the markets, revenue into the continued declines increase which growth in accelerated revenue fourth higher-margin our expansion segments. by highlighting markets. driven quarter, during XX% above performance consecutive period, Energy/Renewables segment. was nearly of quarter increased our and this entirely Energy/Renewables, growth of the in Utilities

our We quarter, and the scale which enhance margin in end In shift a challenges Utilities at size addition, operations in the segment both helping as both increased low quarter, of our Pipeline and MSA strategy, us which gas of of our the PLH we in Services the some acquisition the while the labor power quarter. our delivery milestone advancing in marked prices Group, announced our well key segment fuel continued as margins towards pressured revenues. revenue during our recurring and from for faced stemming and utilities

order a have with our However, moving of tremendous to our of the inflation impact increases done negotiate closely forward. in teams customers to working job our MSA to mitigate rates

Utilities. look Now let's with by beginning at segment, our operations

period. revenue the a Utilities XX% $XXX.X came over in million, prior Our segment increase at year

has rising new Increased management We are from results the continuing higher in synchronized. as well bringing segment by Margins vehicles equipment. largest of during weighed to as this drive the and see activity delivery businesses our customers, and revenue stable work year, the as segment costs million versus substantial earlier. creating growth $XXX teams power in prior mentioned labor segment million in have by as levels fleet [indiscernible] recent new new acquisitions within since impacted the grew factors is business I are inflationary $XXX both fuel quarter. opportunities our integrated Utilities on were prices Backlog and in we the our communication of

into our challenges, XXXX. see benefit our clients, these As previously the negotiating to the the moving expect clients, forward of noted, rate including in the in half to of been larger increases XX% XXXX new offset of rates of over we have and and back successful majority

central opportunities to distribution gas burn prolonged the therefore, states, from on revenue some due the coming pushing of new delivering to late margin these second into half grow in QX continued As also markets but year. in the business into in we the base, client new to we that increased our start start-up costs revenue have expand have planned conditions quarters. had some a expansion noting the winter worth and realized weather It's plan

continue we our month, of and Since working are closely as value we strides transaction of will is beginning for portion closed However, the are will Coast will solid tailwinds East our new renewable which with self-perform the is integration we usual, fit a substantial side while over in our we us double confident in the strength in as to to Utilities awards grid the maintain renewables The the across requires greater PLH connection XXXX. by power as teams key growth substantial communications generated providing has the underway, solid, runway This to addition sources. to quarter significant growth by cross-selling to grow transition installation, the Communication business advantage PLH's PLH market business, several renewable help PLH. us QX opportunities end mix both at the we revenue. our driven of on customers realized that multiple continue and versatility our continued to signed our to be U.S. a and a to several project continue Primoris power quarter. businesses. several Utilities long-term Communications delivery during integrate traditional which us to for markets. delivery achieve large during geographic them clients. made to be complex business in that competitors. Primoris' as footholder small order fiber drive take creating with performed success, are work of offerings and acquisition into with help larger states our by grid a is Primoris. We've power network strategic power of synergy segment, customers. ring multimillion-dollar well made during great major up effectively the in a the with with significant our able spans of organic see This of our sustainable for backlog more the this with Overall, methods also growth win goals. to together on of dependence rapidly will differentiation new strengthens contract electric by giving to we as the revenue have contracts new well expansion

by into long our Energy/Renewables year, came term. the revenue small-scale expectations, diversifying repeat Safe distributed The quarter. execution the over scale on market and and generation diversification these business expansion to well across exceeding at has XX% us to additional $XXX.X grow the on solar million renewables provided or build revenue to Our an second during million, our over customers prior stream projects new our allowing up signed multiple over are $XXX supports with and in focused business. solid of projects solar utility continues

to the on and battery The exciting enabling These area in We with the needs another this new have expect are us knowledge addition $XXX awards what also us are others. underway half line continues to year. to quickly clients. million meet storage, Utilities including teams and we market. our wins renewables helping DG power to advantage among during adapt in to of segment approximately of our execute sight depth and interconnects, gain substations prospects to are new These business. drive strength as to second be on our of this currently to of another our of competitive collaborate the work of Hydrogen projects, this teams delivery synergies allows maintain our in critical in

the hydrogen an point our produced As of be energy of can at utilization renewable is third competitive [indiscernible] leg energy advantage stool, and the excellent storage.

Southern development We a California. hydrogen in large alongside utility in are green making of progress

been with further work a combination to renewables for has several as this to us, expect We continues this engine and others utility of expertise are which forward major we a growth market develop. operational driving Overall, and execution. through

continues grow. the backlog and business record have to it We in

on revenue to nearly minimize in and The also G&A accolade, billion for should I'm are a This QX solar projects confident the At and projects work in margins. as as kilowatts solid awarded new just while profitability, low commercial pending solar by outlook last XX that enabled XX to World for with Power our expansion was this Primoris operational from achieve Inflation, in year. to as space. to contractor next installed margin XX% our maintaining very while long-term U.S. which we over managing XXX,XXX year. increased serve over business. we installed Our leadership named maximize this funding the discipline us the in top kilowatts keeping year and tailwind, Reduction diligently close major $X.X time, drive same over a solar We've the testament costs strength in to prior been say has the is $XXX costs another to our Solar focus years. billion security pleased Act energy

out build accelerate our footprint. only momentum our to as expect forward going further we renewables We

billion. As projects second utility-scale of backlog of quarter project $X.X the for solar our XXXX, totals

and have a late projects the to can to to needs. of components tariffs giving modules risks date executing at a for the compensated We module for costs and for I've our Module When certainty experience adapt install flexibility antidumping, project our by of countervailing brings installed, the last out by then associated those with the diversifying do with clients this return build that work. ability of As and with module do a portfolio associated in delivery have did not work occurs, extra a not If we us risks have and work. primary projects that have customer the we change noted not to late modules continue project clients our later minimized modules. purchase can associated around progress, projects more to We them project manner the our projects. to that before, planning our solar we customers' to potential therefore duty one this our best intentionally delay, us the such impact is the serve

us and, further were The high landscape energy this of faced The health with on materials strong to and a segment energy is and in incorporate are schedules. work financial to delivery side due stabilizing the basis investment project rising and we are in making beginning improving of they our behind therefore, infrastructure. a customers prior quarters design-build softness are now legacy also into due have in to which the energy prices, primarily uncertainty. and to customers market focus is and their challenges transparency the purchase our We of some on degree

due a X% contract expect in in quarter, a to decreasing million made our came up single total I'll During integrity to consistently revenue Services field which Pipeline prior to which in is Segment than approximately were we focus $XXX to year. now approach the projects Department of decrease the types the Transportation. at second pursue declined of billion $XX.X Services. of service backlog, Energy/Renewables the revenue and Texas XX% second on Pipeline our by overall increase These less the segment on quarter end contributing we and move to by year. to heavy our are in awarded to volumes, fewer the driven project pipeline work. million, and pipeline had part compared of projects $X.X

of continue forward. to our a other smaller grow will become Pipeline segments, As portfolio overall we going part our

business costs We to and million into in over latter brought to be spend. continue the course G&A during segment the take in including We manage in to rightsize also the targeting $XX but we in we locations awards hydrogen more Services in relationships the markets, in To volumes it quarter new new some new steps profitability, revenue the with built are last year. next in to XXXX line lowest over us in emerging some give Ken pick I'll of to revenue capture. in drive Pipeline bid the the of and our to are and decade turn and which numbers. have Similar markets activity a client Utilities, see call now are carbon geographic the XXXX. detailed of expect review seeing up half of to should in continuing growing select to

metrics flows Thanks Tom, by cash key and the with and for balance begin good I'll second everyone. our our sheet, morning, backlog. followed operating quarter,

to driven increase of strength second billion, offset was new revenue by for our million us weakness little a prior compared and Services. Pipeline continued quarter mentioned, our This in by year. the growth $XXX.X Tom an record $X over in was markets, As partially a

by partially higher the decrease driven the by delivery Our segment offset for existing X% by across Utilities Utilities due grew $XXX.X business was $XX.X in and million, in million, segment. growth quarter lower Gross growth customers revenue industry. in profit continued by businesses. primarily cost as Energy/Renewables for communications. primarily to second our Pipeline Pipeline power compared to the driven in $XX.X prior in million, million, year. the on our primarily decreased with our renewables segment quarter volumes $XX.X XX.X% our in of industrial as revenues increased in entire our well a margins million and revenue higher increased in segment, Energy/Renewables by $XX.X were Gross margins weakness

the look margins in decrease million Utilities an let's due each declined to segment, higher X to offset XX.X% and from fuel higher margins, was prior profit at gross during of Now year due to $X.X costs to quarter. the lower segments. of impact Gross gross our the the million, $XX.X compared revenues. partially In prior year X.X% the labor by

in recently negotiated customers of gross many range going for the in normal with With to be margins year our the rate July, balance our into that we XX% of adjustments we of to the back effect XX%. expect

renewables expect we growth and to Energy/Renewables profit the industrial continued improved at gross performance a year, primarily came quarter, see demand year, increase the revenue performance was continue X% business our from due $XX.X from and XX.X%, customers QX. solar strong our Gross primarily into due a business. million our our in prior to from For the prior to the million seasonal higher for and year, $XX.X to see rest margins industrials over normal margins. strong of and the in increase

we continue solar sharp $XX.X profit decline profit work resulted prior expect with million and revenue, sequentially Pipeline to as low holding segment significant gross forward, in QX fixed due in grow underabsorption the we in margins in decreased backlog. of in and revenue to QX Looking increase year which and steady the to revenue segment XX% the gross execute range on costs. the from our by gross our

gross year, were completion to the result, due XX% X a projects. pipeline compared was which substantial last margins As negative X.X% to of

expect mid-single modest margins For digits year, to the be on gross the revenue in balance growth. of we sequential the

our we of optimize reduce During the leaseback to assets, a our part sale improve operations entered in both This to of hard our the second that time over technology growth. in operations continue to $XX.X strategic, as lower-cost human to facilities, We completed other invest and California, in one locations will transition area. remaining more increase continued to transaction support we million. the $X recognizing is expenses were leaseback million the to gain us the million, in of resources $XX.X quarter, and agreement a and into properties give of quarter SG&A and year of our company's fleet an X-year in effort prior order costs. initiatives our

prior SG&A revenue, the to X.X% X.X% of percent a decreased to As compared to the primarily due year, revenue. increased in

$X.X primarily higher our SG&A We to flat. by PLH. the change due favorable of a million full million rate in for million But expect debt our fair the decrease Transaction of to offset year. higher quarter, the quarter the million compared to average in interest second average from to were primarily to the mid-X% interest value $X.X swap. essentially $X.X interest range as in low be the related acquisition Net for costs prior was year, the balances well expense our as $X.X was rates slight impact in

rate the for a tax on the quarter, property offset ability reduction loss year-to-date, effective the rate effective is tax XX.X%. XX.X% sale. and due our it Our is capital use to The to tax in to our gain capital was

materials make property gain revenue, buying investing in investment million invested in projects which rate the was in equipment. was This may CapEx, XX.X% solar the our to Net the which in quarter, cash X mix operating to by the of for vary on for second the used use the tax working be and to record effective additive continue we We states work. reduction we to to capital million our the well, for sale for which by a of but the $XX.X is In cash the support but driven $XX.X investment as we activities this of was flows expect cash million. $XX.X operating full on months cash year depending flows.

and million of We $XXX.X with includes capacity million and expect $XXX during driven in quarter, $XX an was the was quarter for customers. backlog million, cash. Borrowing existing equipment. be billion, at the million record the from solar end billion, an was the of the capital by by total of backlog the new million debt the awards. heavy increase available liquidity was was $X.X expected We a ended was $XX $XXX civil revolver million. almost an $X.X million $XXX.X $XXX of $XX.X which $XX expenditures for to under increase driven billion, increase million million quarter. remainder during million And net $XXX $XX to million, of the quarter primarily to our work MSA increase backlog Total Fixed $X.X year an for quarter of

year full EPS $X.XX Energy/Renewables our per reflects to in our earnings partially GAAP benefit the offset increasing in improved guidance. the performance sale our We're $X.XX to property segment, share. performance and Turning the segment. full year the by the from This guidance Pipeline lower to

lowering per primarily contribute are by the addition segment Energy/Renewables year of months $X.XX to contribution due for weakness to share. adjusted improved of from partially per our $X.XX X of to adjusted the last share, should PLH. EPS the in EPS PLH in The offset and We by performance Pipeline, $X.XX approximately guidance

Tom. customers by we've balance see Utilities of With Energy/Renewables backlog. underscored about and continued addition it the with I'll the And business, our solar for PLH, the the negotiated year our and good that, of with we our record strength the rate back prospects Utilities our very strong our and changes feel to of both turn

Ken. Thanks,

less continue our of be on X% than a of construction, focused markets which our made pipeline the Utilities quarter and smaller part going revenues so increasingly overall and are to business less this on forward. will we ahead, Looking up Energy/Renewables and

We Energy/Renewables our strong by of and in have billion business highlighted between new our segments. momentum we growth in $X.X a markets, nearly Utilities brought

Ken updated grow , for the full XX% compared outlook provided Our Energy/Renewables year: year. to the XX% to that the just to approximately following segment With we expect last

increase range $XXX Utilities of year our XX%. million finish segment in the to year between Our last the XX% to million. to $XXX to below And segment Pipeline

power energy. trajectory, aligned a achieving growth of goal are work is capturing support delivery solid future. ongoing strength together market the overarching a to and infrastructure, business. next-generation of renewable have net including we We zero The by both tie and broadband pursuing themes, secular our the with These all supported

We as eye businesses Jobs Act, tailwind as Infrastructure including The as are keeping and are for projects and of major served well businesses. other our rural urban to our should to a close on legislation, growth energy growth and Utilities broadband as well capture positioned several shovel-ready strategy. government opportunities our with a on drive the significantly renewable XG creating transition deployments, these opportunities execute to has continue we sources we which

mind, the the a us PLH continuing these we I'll we business. markets. portfolio range now gas which develop spur leverage to our factors the see a and capabilities and Primoris drive added for further have Operator? the growth utilities acquisition, With hand call bright of With today. over Q&A. joining expansion to we for in future to to delivery again ahead all power you for forward our will look long-term new operator and into for to continue to Thank

[Operator Instructions].

Goldman of the from Jerry Revich line Sachs. comes question with first Your

talk Can acceleration was the quarter. or with just up burn sequential you if folks the online were in drove ability additional renewables sharp about crews you revenue bring to what segment. in I in your the able to impressed ramp

Jerry, Well, all building growing, crews along. been we've

in generation we're earlier, the noted I distributed As also now.

operation employees on I either to generation. for Pipeline resources new we distributed to of renewables able our some with redeploy, So that guess, over take and were

work that's a over to noted, we expect the we of helped $XXX work $XXX of year. And grow have that the worth end so execute that. And of little about million another on worth we there. And have before I as million

capacity, build But of it. take funnel that do negotiating part that's I course, and continue we do, it as other on have to and as various the of And huge part can trying there's in to teams projects noted on win build in or that's stages, of continuing we've a whether to clients what contracts, and or for we're LNTP just achieve been able of bidding previous be more growing calls, we different we're it And So in is -- and teams. discuss work. we and our work. group pricing we're to renewables the actually that able consistently we've we and been have strength

the crews? you specifically, solar at for are business, than Or higher are And that? X you

We're we're -- building know. wouldn't adding crews eighth our I now. seventh Yes. right and

in our I finished and these on about think we're and they're training employees in And finished board, most -- crew. development. crew seventh -- building eighth we're they're our just with of are just

Super.

Okay. about Great. And Utilities then talk the segment. can we

sequentially pricing pushing wondering a your in remarks, prepared expand the you spoke how with margins. I'm for look looking to XQ quarter we're about much pretty As under XQ? quarter seasonality, normal to third similar now your margins that should margins versus we second increases be price

should they where you total they'll by going back forward. are, on go they traditionally second go diluted they're be quarter at percentages to when year traditional and based to results. although first look going the to But just back it, the Well,

negotiating We them be in retroactive. to negotiating them. So successful weren't successful in were we

So very good. -- but they on a look go-forward basis,

put that. to a finer just And on point

of thinking that the margins. you in Utilities level the year, should XX% think back like I to of gross folks about It run normally, going back sounds in be profitability? about half we

like Jerry, the back I to be shaped Yes, normally XX% of year. the I is. said my And of it it in course, think in remarks, XX% half will

CJS next comes from line Lee Your Jagoda of question the with Securities.

for Pete Lee. It's Lukas

cadence be remarks, range? would the down -- And but expected would the sequentially? expect from also quantify can PLH in you about up, the terms accretion prepared also same guidance, implied the QX the 'XX I PLH, to excluding in for think in on touched it you or the you sorry, of total of in revenue

$X.XX of be was X is clear. adjusted I'm for what that And of part then, to last ask Pete, going year I again? the sure they're So your at question? that the to months us. you want second the PLH make contribution EPS Could

So excluding expect you cadence or down sequentially up, about would of PLH, revenue same for to the QX? total the be

Up.

that how going the to then And clients in that And potentially discussions impact? costs some margins quantify are have of Fantastic. fuel these extent with can Utilities the to segment, impacted recoup you costs?

Well, year difference other is Utilities segment in from year vast seen primary majority but That's the the margins impact. seen the that's fleet it. little of segments, is last impact to X% in seen We've Utilities the it place a segment. we've in this the the the where -- the really X bit it's we've our and in

largest had As our Tom X. rate mentioned, the rate into had changes the go the customers or We've of with did great July effect response benefit them. balance July X for significant Those negotiations effect into And there. from we're year. of go expecting we've some those of adjustments

miles any our the in Utilities our drives that probably of quarter. Xx I'd One is segments other segment given add thing two combined

fuel. have the They part most largest they So burn fleet equipment. the most drive they the and of miles, our

Fisher Your from next the line of Steven UBS. question comes with

ramp-up ask going revenue level. kind growth. you I maybe to what on you the in in be of pretty the mix a you the said Pipeline the revenue think modest revenue just of segment wanted just to do But know modest different margins I quarter half year. big growth second second over about is have and a would the about

margin that the enables there to different to there? going you what's about to maybe So that mix be get mid-single-digit

Yes. Steve. Good things. Two question,

great. we have that done West to First zero of in had It Virginia the was burning still all, is that quarter. just at now, up margin one loss that behind one this in job QX, glad last It's took which us. I'm quarter.

So the of cutting low order margins underabsorption at as even into minimize to going that like efforts, single kind of have that margins. normalized more months though to modestly, closer X mentioned, a And the to of begun get between half ago, should have about. issue, talked up that burning or couple normalized but digits begun, have as be at We're impact. still I little we'll of should back bit in the only revenue we of a the costs that year, us we

And say how you other Okay. right, customers? should And the could That's of helpful. sets up addressed we XXXX. hear think at and guess but in have XX% think XX% I clarify, Utilities that about if segment that's how did don't the you I I that you costs for your

So the majority largest of XX% our of the customers represents customers. our

adjustments, able make that's revenue triggers spend either us most the informed going adjustments not will are them the customers of with where balance, So they're we're have -- typically have things wait that to they negotiating The an still our trigger have or be. -- be -- that to any and until annual they'll these that to on those.

the we'll negotiating have on MSA of based we'll up for still and we're terms, them, when some, we With or may contract success. or see adjustments the come those either So they not. some

the to EPS hit the $X average quarter could just of to have a you Okay. EPS, that year, think for And of second you the midpoint. lastly, if about just then cadence adjusted clarify I because half

quarter. can you is guess provide I just towards more other there? weighted color But fourth assuming any it's I'm the So there

That's a going Yes. range. are question, fairly actually to both QX be We to good dollar weighted quarters Steve. It's and that QX. in right be evenly going think between

of comes Sidoti question next Company. line & from Julio the Your with Romero

start. question to A clarification

and XX% grow Towards what's to the XX% think XX%, the to segment sales I that's Energy/Renewables your deck. on think a XX% of reverse remarks, Utilities of said I Tom, to and guidance end of you slide prepared the

could 'XX. for or you know revenue clarify I So sales target the if if I don't you segment growth misheard

to corrected. XX% turning I'm incorrect the XX% referring you're will will in is the And XX%. grow XX%. to, be is. Utilities slide slide Energy/Renewables The just needs to deck, it it to It slide, the to to grow

that. Sorry about

corrected repost. and that get We'll

that existing benefits Got No backlog done those I that a prices do rate successfully. immediately Or I you as Utilities some worries. see it. you've get of know on cost XX% fuel have benefits Do of guess. the clears you lot July do my to of labor through the in and talked hit? up on increase before side, That about questions you hit here, the P&L? projects, X? clients, your rate benefit The

The rate X. July became effective on

Okay.

later, you Or guess? your does on that that X So take July see I P&L?

Yes. day. July -- We starting the benefit that see

Okay.

are And of for out? customers Perfect. thinking last the Okay. on project pushed just solar any you billings half? your about -- the how in from are your the customers? variability your then side, me affect back schedules And seeing any is ULFPA that your getting seeing impact the does one And

had seen not in of We've modules modules, all entirety. delays that delivery some have projects in some their the but

So a delivered going late. were then work modules to come were of later modules. the all again, the job still back install you XX% We and you and be execute able the could say just to

impact. doesn't going big send for to have crews back. already the it to of the part, majority There are really So have the work But a projects most some where is we're complete.

Your question from Sean the of Markets. with Capital next comes Eastman KeyBanc line

the back contributing In I drag in to and a materials, to you inflation wage guys just investor the Utilities margins. highlight segment fuel come on margins. to both of wanted terms

much year-on-year here, you Q&A pretty the all Ken, think suggested I that decline in the was fuel.

expectations. clarify because that think just go-forward quite about to we So obviously the that's as important wanted I

Yes. Good question, Sean.

fuel So -- let is that. me both clarify and inflation. It labor and

And across of that's now, don't in our inflation, all I right me we've that's probably an of front that's point, -- nationwide. -- think important right? but markets across the seen probably board, numbers Because have and impact. the So the X/X of fuel about I

specific The is is other labor, X/X certain markets. to which more

seen board, We it markets. in labor few haven't seen the across it only critical We've inflation. a

the labor The customers in And also XX% of that And focused right? the we've labor with particular, markets in so of with been where we've and on combination those a fuel. dovetails has actually XX%, negotiated seen that inflation.

And adjustments we've [indiscernible] gotten both. to

this Okay. total in that have handle the a makes you That for And around or do business? guidance the feel within of enough you sense. dynamic guys you embedded what PLH a cushion

we good. Yes, really feel

at the depths continuing of with customers closely, -- since spent time, of and closed even back contracts, and between they We with the understand announcement about relationship their amount understanding closing X.X year. both have a expect what their business, weeks working their the of the and half we them ago, significant to

about put in we we've that good very feel here. So the numbers

pretty a I handle it's -- it. think on to the a and drag a I to And be staying inflation think coming labor look to We deploy straightforward. what labor was cost just the fuel going had like on thought mean, particular year what side, Got going side, guys have inflation firm wage would spike expected. would I you region. pretty big Okay. resources was you labor in to But have into mean, the I there. the then I on

perspective, So wage what's of of just how happening, these of ground here would you terms frame first inflation higher kind guard you in off the on that half and some maybe from in the caught boots regions. what's

a very in I Look, wages. to a the you power internally journeyman, talking the develop of biggest think it, we've the skill that for even where resource. they're lineman specific is set develop you're trained. going to increase and years seen when and and takes delivery, it's is number limited them biggest factor to start about into It get that schools where

So seen go surprised, it's it -- we've past gone and dramatically I although over think it's was probably up couple the of up everybody we've how and seen, quarters.

very very a labor resources. demand just it's limited So high market with

those to able be higher to stay. going wages them get get to the have resources and pay to you're to So

quick Okay. Got it. me. And just then one last for one

same Just on the topic.

guys do Energy/Renewables incremental that segment, bleed of look into as part to wage the kind in any about see huge as at of backlog? this inflation you being you Is on the business to execute we good heavy you there able this that the of have where risk already well As resources growth feel in terms labor backlog you continue accelerate?

We our renewable business. every surveys that do labor in we in estimate a market project

they then have very Those those and So a what in had of those start we we areas so inflation. very on short specific cycle. wage end life know put the are rates contingencies dates, jobs kind and for a

It's So sets if also we using fiber. hurt a it little bit, lot. a journeyman not those us lineman skill train or it's easier to going it than is missed someone to a

Davis. Adam from line with comes Your next question Thalhimer the of Thompson

just that. things transmission a I'm do Utilities like but and on is more of expect thinking you fixed projects your you I guess add how PLH increase question, much individual them? to when backlog this about they're bidding

work just The vast of ours. majority their under MSAs like is

Utilities So MSA the in it increase. all backlog all, almost will be segment, almost

on then quick Okay. I front? a of you savings there ongoing terms that sale guess And could and is leaseback more in question what on the can why now, be do the

like -- I'd that worth unsolicited opportunistic. looking coming sitting we we just of honestly in worth of had opportunity had felt to at. We Literally, we Southern bit now. no were in it was not planning on don't think the There's along. I many property that idea California The that It's so speak this. sell were it was market. piece actively a here, potentially had a inbound just that came -- we why and purely It I little We more was much. calls

on a I great So great of windfall. It the cost have it basis. strategic the reduction was don't a us. was a decision go-forward quantification for

don't I course that's be in to to out I we've just quarters the that's that have going that really front as new think to those going solidify the identified, we coming over into, going be of already we're of numbers locations worked the me. moving --

market Same assets it we Do the same at. do we with it thing in? have Look, evaluate that it? to move If we we look we the it? -- need can thing. move and we right Is everywhere don't,

And to evaluating can term, and trying consolidate? we there's that it long look doing is need reviewing a that. in benefit constantly it what there the -- is need? we're and Or So a is

Future I well between lastly, like I'm seems just guys performing is of lines, Okay. And but reading the you this kind for guess pretty year. it

what when They we doing thought do are. we They're would They they are. exactly them. bought

Your next D.A. question Brent Thielman from line comes of Davidson. the with

is everything of to the in way out and backlog break energy civil between renewable, there a else? Ken, then sort solar, Great.

me Yes. those of numbers that in I I though. front have know don't

presentation. in it the was thought I

now. I have the I piece of of sorry, we in of I'm the north don't end that Yes. backlog right Brent, But $X quarter. the it kind renewables think in were segment as just billion of front just of still of for me

is could year? solar than XX% grow that it this more And guys' your expectation

Yes. Absolutely.

Yes

cost And just of you're sort about around out, side. that. before? like an then it mean you of curious you integrity some capabilities emphasis the of the I you about are more business? some your have Are structurally resizing Or comments sounds kind on mean pipeline all you still on talked the this you side, I was had taking action, -- I

the need capacity we management carry to construct may the much pipelines. have capability fixed same that the once interstate still team. there's to We many to as pipelines, We not We personnel. still to do as have costs. just keep other We costs. have used spreads just of because and to utilizing we'll to those right field not. key or do -- we we let Others, costs some same to whether go have mitigate now tell continue in areas still We're need that and down those no evaluate those

work are in which happens XXXX. for that some promising, although pretty activity, bid is seeing be We will it

Yes.

that Just was investment your if you're new Tom, what Does ability also within you How segment. that on require just curious then equipment comments I And and of far reach? a to elaborate -- Okay. does Utilities in seeing big was your kind the awards utility? resources, the there? made leverage could you renewables around

our already have that PLH our was the the that. previously addition substations. associated augment It's grid. tools. There everything couldn't to now, helps it's of clients a with sets. that. I service the mean really but PLH offer we already skill expands the that We have We -- connections just It's capabilities. the equipment to just and

what more that you guess win allowing of the some I there, out about. that's I work is to And Tom? relative to competition was curious

it's seeing say like fact tying do us, their to to I grid. And all But of contractor Maybe We put for the clients build more and throat to really guess. like can can more I the the responsible wrong the the would that's it I can one think way one design having say. all to we hard mean, they -- We facilities. one I that we're it but out work. that's choke, it, to way like everything.

would call like remarks. no questions. there I back are time, to over the McCormick turn further for this closing Mr. to At Tom

you, operator. I'll your We from quarter. reiterating you appreciate the this by your and investment key today Thank thank second call the close in Primoris. takeaways questions for

less Utilities our Energy/Renewables, and by continue highlighted on focusing accelerate PLH, while We Pipeline. the focus to on acquisition of

our opportunities that secular long-term advance Primoris which us. Our around of helping capturing want great without that do things I you our growing employees society centered of all of is whole. ahead while represents expand have their a our We again, the we every and and growth and cannot safely efficiently lay backlog the strength And business as the working thank hard the do commitment our to Thank for everyone, of both a will day. size work. day. strategy trends and

concludes conference. today's This

disconnect. now may You