MYR Group sees mixed results in 3Q

ROLLING MEADOWS - MYR Group Inc. said increased revenues from current projects helped drive third quarter 2015 revenues up 8.6 percent, but net income fell by 26 percent as the market remained highly competitive.

The electrical infrastructure contractor reported revenues of $269.9 million, compared to $248.5 million for the same period last year. Net income for the quarter was $6.2 million, compared to $8.4 million for the same period last year, a decrease of 26.5 percent.

Specifically, the company's Transmission and Distribution segment reported revenues of $203.9 million, an increase of $23.9 million, or 13.3 percent, from the third quarter of 2014, primarily due to higher revenues from jobs of all sizes. Material and subcontractor costs in our T&D segment comprised approximately 25 percent of total contract costs in the third quarter of 2015, compared to approximately 34 percent in the third quarter of 2014.

The Commercial and Industrial (C&I) segment reported third-quarter 2015 revenues of $66.0 million, a decrease of $2.5 million, or 3.7 percent, from third-quarter 2014, due primarily to lower revenue from large jobs, partially offset by the acquisition of E.S. Boulos Company ("ESB").

"The third quarter was a challenging three months for MYR. While our revenue was higher, our gross margin was down due primarily to heightened competition in many of our markets and a few underperforming jobs due to various productivity issues," said Bill Koertner, MYR's president and CEO. "Also, much of our revenue this quarter resulted from small and mid-sized jobs with shorter durations which tend to lead to lower overall equipment utilization and lower labor productivity because the jobs are often finished before our crews fully reach their productive rhythm. Continuity of work remains key to our success.

"We are pleased that our investment to expand into some new geographic markets is beginning to show some positive results," he added. "We plan to remain disciplined with our approach both as we grow organically and consider acquisitions in order to capitalize on the strength of our team, customer relationships, specialty equipment resources, strong balance sheet, safety record and customer service reputation."