Quanta Services Inc

NYSE:PWR

Earnings Call Transcript 2020-Q4

[Operator]

Greetings and welcome to the Quanta Services Fourth Quarter and Full Year 2020 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions]. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host Mr. Kip Rupp, Vice President and Investor Relations. Thank you, sir. Please, go ahead.

[Kip Rupp, VP, IR]

Great, thank you and welcome everyone to the Quanta Services fourth quarter and full year 2020 earnings conference call. This morning we issued a press release announcing our fourth quarter and full year results, which can be found in the Investor Relations section of our website at quantaservices.com, along with a summary of our 2021 outlook and commentary that we will discuss this morning. Additionally, we'll use a slide presentation this morning to accompany our prepared remarks, which is viewable through the call's webcast and is also viewable or available on the Investor Relations section of the Quanta Services website.

Please remember that information reported on this call speaks only as of today, February 25, 2021, and therefore you're advised that any time-sensitive information may no longer be accurate as of any replay of this call. This call will include forward-looking statements intended to qualify under the Safe Harbor from liability established by the Private Securities Litigation Reform Act of 1995. These include all statements reflecting Quanta's expectations, intentions, assumptions or beliefs about future events or performance that do not solely relate to historical or current facts.

Forward-looking statements involve certain risks, uncertainties, and assumptions that are difficult to predict or beyond Quanta's control and actual results may differ materially from those expressed or implied. For additional information concerning some of these risks, uncertainties and assumptions, please refer to the cautionary language included in today's press release along with the company's periodic reports and other documents filed with the Securities and Exchange Commission, which are available on Quanta's or the SEC's website. You should not place undue reliance on forward-looking statements and Quanta does not undertake any obligation to update such statements and disclaims any written or oral statements made by any third-party regarding the subject matter of this call.

Please also note that we will present certain historical and forecasted non-GAAP financial measures in today's call, including adjusted diluted EPS, backlog, EBITDA and free cash flow. Reconciliations of these measures to their most directly comparable GAAP financial measures are included in our earnings release. Lastly, if you would like to be notified when Quanta publishes news releases and other information, please sign up for e-mail alerts through the Investor Relations section of quantaservices.com. We also encourage investors and others interested in our company to follow Quanta IR and Quanta Services on the social media channels listed on our website. With that, I would now like to turn the call over to Mr. Duke Austin, Quanta's President and CEO. Duke?

[Duke Austin, President, CEO, and COO]

Thanks Kip. Good morning everyone and welcome to the Quanta Services fourth quarter and full year 2020 earnings conference call. On the call today I will provide operational and strategic commentary and will then turn it over to Derrick Jensen, Quanta’s Chief Financial Officer who will provide a review of our fourth quarter and full year results and full year 2021 financial expectations. Following Derrick's comments we welcome your questions.

As noted in our earnings release this morning we have renamed both of our segments to include solutions which we believe is an accurate word to describe the value creating and collaborative approach we take to working with our customers. Additionally, we renamed our pipeline and industrial segment to Underground Utility and Infrastructure Solutions which we believe is more reflective of the strategic changes we have made over the past five years to reposition this segment towards a greater level of resilient business services to our gas utility, pipeline integrity, and industrial customers. These services tend to be more visible and recurring in nature and are driven by safety, reliability, and environmental regulations. We continue to expand our capabilities in both segments to provide comprehensive end-to-end solutions with cross skilled labor at the core.

We're proud of our successful focus on base business activity over the last five years which now accounts for more than 90% of our revenues. We continue to view large projects as upside opportunities and are well positioned to safely execute them when they occur. Quanta performed well and delivered a solid year in 2020 which includes numerous accomplishments. This was due to the performance of our field leadership and the people of this organization, who continue to be exceptional. There are so many accomplishments in 2020. Electric power segment revenues achieved record levels and we earned our best operating margin performance in six years driven by strong execution across our operations. Included in these results were record storm response revenues from supporting our customers efforts to restore power to millions of people adversely impacted by numerous severe weather events during the year. Our ability to quickly mobilize this level of resources to support our customers in times of need even during a pandemic is unmatched in our industry.

After an 18-month competitive process LUMA Energy, our joint venture with ATCO was selected for a 15-year operation and maintenance agreement to operate, maintain, and modernize PREPA’s more than 18,000 mile electric transmission and distribution system in Puerto Rico. LUMA and PREPA are making good progress towards transitioning operations of this system this year and we continue to believe this opportunity is transformative for Quanta.

We grew our communication services revenues by more than 40%, meaningfully improved profit margins and ended the year with a total backlog of approximately $900 million. We substantially completed the exit of our Latin American operations, despite the significant challenges and impact to these wind down activities from the effects of COVID-19. We continue to lead the industry in safety, which we believe starts with training. We continue to incrementally invest in our training efforts through our Northwest Line College and Quanta Advanced Training Center. Additionally, last year we began site preparation for a new line worker training campus in Puerto Rico that will be operated by Northwest Line College. The facility will provide world-class training to LUMA’s employees and develop Puerto Rico's future cross skilled workforce. Our industry leading training and recruiting initiatives are driving improved productivity in the field and ensures that we have the very best craft skilled labor. This enhances our ability to collaborate with customers and labor affiliations on future workforce needs and further differentiates us and the marketplace as a strategic solutions provider.

We invested approximately $400 million in strategic acquisition of seven high quality companies with great management teams that expand or enhance our ability to provide solutions to our customers or additive to our base business and advance our strategic initiatives. These companies add to our self-perform capabilities, which typically accounts for approximately 85% of our work and are key to providing cost certainty to our customers. We believe our approach to acquisitions and our operating model helps de-risk our work portfolio through improved execution and results in more consistent earnings. We strengthened our financial position with the closing of our $1 billion investment grade senior notes offering, which we believe points to the resiliency and sustainability of our business model and positive multi-year outlook.

We demonstrated our commitment to stockholder value and confidence in Quanta’s financial strength and continued growth opportunities through the acquisition of approximately $250 million of common stock and a 25% increase in our dividend. And finally, the diversity of our services, proactive cost management, and execution through significant uncertainty caused by the pandemic and challenged energy markets allowed our underground utility and infrastructure solutions operations to perform well under the circumstances. We are optimistic that the most challenging market conditions are behind us, and we see opportunity for revenue and margin improvement in 2021, and continue to believe this segment can achieve upper single-digit operating income margin as operating conditions further normalized over time.

We believe our strategic position in the marketplace remains strong and we are well positioned for continued profitable growth over the near and longer-term. Despite unprecedented operating conditions and uncertainties caused by the global pandemic proportions of our business, the strong performance of our electric power and communications operations resulted in record adjusted EPS, adjusted EBITDA, cash flow, and backlog in 2020. While we are proud of the achievements last year, we remain focused on getting better to ensure that Quanta continues to evolve to effectively collaborate with our customers and business partners and helping them achieve their goals and to capitalize on the opportunities ahead of us.

The recent severe weather conditions that impacted living conditions in Texas and other parts of the country shows how critical infrastructure that we design, build, and maintain is to our everyday wellbeing. The solutions Quanta provides supports our customers’ efforts to increase reliability, safety, efficiency, and connectivity, all of which have a favorable environmental and social impact on both the markets that we serve and society. Additionally, our solutions facilitate policies and goals aimed at the adoption of new technologies and transitioning towards a carbon neutral economy. As a result, we believe our business is levered to favorable and sustainable long-term goals.

Our utility customers who account for more than 70% of our 2020 revenues are leaders in the effort to reduce carbon emissions with aggressive efforts to modernize and harden their systems, expand their renewable generation portfolios, and implement new technologies for current and future needs. A number of utilities have committed to providing 100% of their power by clean energy or achieving net zero carbon emissions by 2050. Achieving these goals requires substantial incremental investment in transmission, substation and distribution infrastructure to interconnect new renewable generation facilities to the power grid and to ensure grid reliability due to the significant increase of intermittent power added to the system.

Further developed economies are expected to be increasingly driven by electricity to meet carbon reduction goals over time. Vehicle electrification offers a large carbon reduction opportunity in addition to residential and commercial space and water heating and industrial and agriculture electrification. According to a report from the Wire's Group [ph], increased electrification and electric vehicle adoption in United States could require a 70 to 200 gigawatts of new power generation by 2030. The majority of which is expected to be renewables and could require incremental transmission investment of $30 billion to $90 billion by 2030. We believe these investment requirements associated with electrification are in addition to the significant multi-year investment programs already in place for the coming years to modernize the existing power grid to ensure reliable power delivery under current market conditions.

The outlook for our communications operations, which is within the electric power segment remains bright. We expect to generate approximately $700 million in revenue this year, which would represent approximately 30% growth over 2020. Our communication services support the technology we use every day for work, education, entertainment, connecting with friends and family, all of which are critically important. To that end, the effects of COVID-19 have caused communication providers to increase investment in the fiber networks to ensure adequate speed, capacity, and reliability to meet these needs. Additionally, we believe Quanta is well positioned to leverage our electric power and communication solutions capabilities to assist many of our rural and municipal electric customers who are expected to participate in the rural digital opportunity fund. This fund provides more than $20 billion to bridge the digital divide that exists for millions of people living in rural America without access to adequate broadband connectivity. Further, we expect 5G deployments to accelerate in 2021, which will remain well positioned to continue to participate in.

Our underground utility and infrastructure solutions segment experienced meaningful challenges during the year due to the effects of COVID-19 such as shutdowns in certain cities that had short-term impacts on our gas utility services and the significant reduction in demand for refined products that materially impacted our industrial service customers. As discussed previously, we believe the greatest impacts from these dynamics are behind us. Going forward, we expect to continue our focus on our gas utility, pipeline integrity, and industrial services businesses consistent with our strategy over the last five years due to the favorable long-term trends driven by safety, reliability, and environmental regulations. Our gas utility services supported with regulated programs to replace and modernize aging infrastructure, which can be [indiscernible] and pose potential safety concerns. They also support customer efforts to reduce methane emissions and positions the gas distribution systems to potentially deliver hydrogen to users in the future.

Our pipeline integrity services seek to ensure that existing pipelines operate safely and in an environmentally friendly manner. And many of our industrial services support customer’s compliance with regulations aimed at minimizing environmental impacts caused by methane gas release and increase operational efficiency and safety. We believe these favorable safety, reliability, and environmental initiatives and long-term industry trends such as electrifications and technology implementations will continue to drive growth opportunities for Quanta for the foreseeable future. Quanta is actively engaged in collaborative conversations with many of our customers about their multi-year multi-billion dollar programs extending as far as 10 years. Regarding how Quanta can provide solutions throughout our customer's value chain to meet their strategic infrastructure investment goals in support of these initiatives.

In our earnings release this morning, we provided our 2021 guidance. We believe -- which we believe demonstrates the strength and sustainability of our business and long-term strategy, favorable end market trends, our ability to safely execute in a strong competitive position in the marketplace. Our expectations call for growth in revenues, adjusted EBITDA, and earnings per share and improve profit margins. Additionally, we see opportunity to achieve new record levels of backlog in 2021.

In summary, we generated solid results in 2020 that we believe reflect the resiliency and sustainability of our business, the benefit of our strong financial position, the successful execution of our strategic initiatives, and the excellence of our people. The challenges we faced and the way we continue to support and collaborate with our customers last year, particularly as it relates to the pandemic, brought out the best of this organization and I believe made Quanta stronger. Overall, our end markets and multi-year visibility are solid, and we have built a strong platform that positions us well to capitalize on favorable long-term trends, particularly the transition towards a carbon neutral economy and the adoption of new technologies. Considering our organic growth opportunities and the levers available to us to allocate future cash flow generation and to creating opportunities such as stock repurchases, acquisitions, strategic investments in dividends, we believe Quanta will continue to generate meaningful stockholder value going forward.

Quanta is a portfolio of exceptional businesses with geographic and service line diversity. We are anchored by our commitment to craft skilled labor and our self-perform capabilities. We are focused on operating the business for the long-term and expect to continue to distinguish ourselves through safe execution and best in class skilled leadership. We will pursue opportunities to enhance Quanta’s base business and leadership position in the industry and provide innovative solutions to our customers. We believe Quanta's diversity, unique operating model, and entrepreneurial mindset form the foundation that will allow us to continue to generate long-term value for all our stakeholders. I will now turn the call over to Derrick Jensen, our CFO for his review of the fourth quarter and full year results and 2021 expectations. Derrick.

[Derrick Jensen, CFO]

Thanks Duke and good morning, everyone. Today we announced fourth quarter 2020 revenues of $2.9 billion. Net income attributable to common stock was $170.1 million or $1.17 per diluted share and adjusted diluted earnings per share. Our non-GAAP measure was $1.22. Overall the fourth quarter closed out another exceptional year of operational performance for Quanta, a year in which we delivered record results across multiple metrics despite headwinds faced related to the pandemic. Our electric power revenues excluding Latin America were $2.11 billion, a 15.7% increase when compared to the fourth quarter of 2019. This increase was driven by mid-single-digit growth in our base business, increased contributions from the timing of certain larger projects, and $75 million in revenues from acquired businesses. Contributing to the base business growth was approximately 13% growth from our communications operations and record fourth quarter demand for our emergency restoration services of approximately $150 million primarily associated with efforts to restore infrastructure in the Southeastern and Midwestern United States although it came at the expense of certain other work in progress. Partially offsetting these increases was the expected reduction in fire hardening work in the Western United States during 4Q 2020, as compared to 4Q 2019.

Electric segment margins in 4Q 2020 were 11.6% and excluding our Latin American operations segment margins were 12.9% versus 9% in 4Q 2019. The robust operating margins were driven by increased profit contributions from the elevated emergency restoration services which typically present opportunities for higher margins due to higher equipment utilization and fixed cost absorption as well as improved margins in our Canadian operations primarily associated with certain larger transmission projects. However, although difficult to calculate the direct incremental effects, excluding revenues and profit from storm response efforts, our margins were still comfortably in double digits reflecting continued strong execution across all of our electric power operations. Of note, our communications margins continue to improve against the prior year with a margin of 9% during the quarter.

Regarding our Latin American operations included within the electric segment, we have substantially completed the wind down activities required to exit those markets. Our year-long effort to shut down our operations across the region was significantly impacted by COVID-19 dynamics, as well as political and regulatory uncertainties and customer challenges all of which contributed meaningfully higher losses than anticipated. In the fourth quarter we took the additional step of reserving remaining property, equipment, and inventory assets as the uncertain market conditions minimized likely recoveries upon disposition. As a reminder, we currently received no tax benefit for losses in Latin America so the $27 million in losses impacted the quarter by approximately $0.19. With minimal contractual obligations remaining, we feel comfortable that other than arbitration updates on the terminated Peruvian communications network project, we will no longer provide commentary on Latin America.

Revenues from our underground utility and infrastructure solution segment were $806 million, 36% lower than 4Q 2019. Similar to prior quarters, expected reduced contributions from larger diameter pipeline projects contributed to the decline. The variability attributable to larger pipeline projects is why we've taken strategic steps to reposition our service offerings around more predictable utility backed revenue streams. While we remain well positioned to opportunistically deploy resources for larger pipeline projects, we expect most future work will consist of smaller pipeline transmission and integrity oriented projects. Additionally, the lingering negative impacts of COVID-19 have reduced some level of demand for broader services across the segment with reduction in demand for refined products, substantially contributing to reduce quarter-over-quarter revenues from our industrial operations.

Operating margins for this segment were 5.1%. These margins were 190 basis points lower than 4Q 2019, primarily due to reduced revenues as well as some degree of execution challenges during the quarter and cost associated with the exit of certain ancillary pipeline operations. These negative impacts were partially offset by net positive project closeouts, primarily driven by the recognition of previously deferred suspension and milestone payments and the reduction of remaining contingency balances associated with the Atlantic coast pipeline project, which was officially terminated on December 31, 2020.

Our total backlog was $15.1 billion at the end of the fourth quarter, slightly higher than 4Q 2019 and comparable to the third quarter of 2020 yet remains at record levels. 12 months backlog of $8.3 billion is an increase from both the fourth quarter of 2019 and the third quarter of 2020. As a reminder, the LUMA joint venture is accounted for as an equity method investment, and therefore does not contribute to revenue and is not included in backlog. However, assuming an operating margin profile consistent with our electric power operations LUMA's contribution over the 15-year operation and maintenance agreement would imply a backlog equivalent of more than $6 billion for Quanta.

For the fourth quarter of 2020, we generated free cash flow, a non-GAAP measure of $200 million and although $381 million lower than 4Q 2019, it was higher than we anticipated driven by stronger profits in the quarter and the cash cycle consistent with our third quarter results. For the year we generated record free cash flow of $892 million. Day sales outstanding or DSO measured 83 days for the quarter, which was comparable to the third quarter of 2020 and fourth quarter of 2019. Cash flows in the fourth quarter and full year 2020 did partially benefit from the deferral of $37 million and $109 million of employer payroll tax payments permitted by the CARES Act with the payments due in equal installments at the end of 2021 and 2022. We had $185 million of cash at the end of the year with total liquidity of $2.2 billion and a debt to EBITDA ratio as calculated under our credit agreement of approximately 1.2 times.

Turning to guidance, we continue to deal with some level of COVID-19 uncertainty as we assess the near-term prospects of our operations, primarily in our underground utility and infrastructure solution segment, and we've remained prudent with our expectations for 2021. However, as we look ahead to 2021 and beyond, we see the base business propelling multi-year growth opportunities for both segments. Electric segment revenues grew to $7.8 billion at the end of 2020 and we continue to see our base business providing mid-single to double-digit growth opportunities, coupled with some degree of increased contributions from larger projects, primarily associated with previously announced projects in Canada. In the aggregate, we expect electric power revenues to range between $8.3 billion and $8.5 billion, which includes expected revenues from our communications operations of around $700 million.

As it relates to electric power segment revenue seasonality, we expect revenue growth in each quarter of 2021 compared to 2020, with quarter-over-quarter growth in the first and second quarters, potentially exceeding 10%. We expect first quarter revenues to be the lowest of the year due to normal seasonal weather dynamics impacting certain construction activities. We expect the high end of our revenue range to represent greater revenue growth opportunities in the third and fourth quarters relative to 2020.

We expect 2021 operating margins for the electric power segment the range between 10.1% and 10.9%, which includes contributions of approximately $29 million or $0.20 per share from the LUMA joint venture and earnings from other integral unconsolidated affiliates. LUMA is expected to contribute around $9 million in the first half of the year, then increasing in the back half of the year as we exit the front-end [ph] transition services period. Although we are proud of our overall electric power performance in 2020, our 11.6% margins excluding Latin America, are above historical averages and are the highest since 2013 due in part to record annual emergency restoration service revenues of $450 million.

As outlined in our accompanying slides, our 2021 expectations for margins for this segment are consistent with historical averages, and are also based on expectations for more normalized emergency restoration service revenues of approximately $200 million, also in line with historical averages. As is typically the case, we expect that first quarter operating margins will be the lowest for the year, possibly slightly below 10%. However, we expect margins to increase into the second and third quarters and then slightly decline in the fourth quarter. We believe communications operating income margins which have been dilutive to segment margins in prior periods could be at parity with electric operations on a full year basis.

The underground utility and infrastructure solutions segment continues to be impacted by COVID-19 and the challenging energy market conditions. However, we are anticipating upper single-digit to double-digit revenue growth off of 2020 with full year revenues expected to range between $3.65 billion to $3.85 billion. Over 90% of our revenue expectations for 2021 represent base business with larger projects representing their lowest level of contributions in the last seven years. From a seasonality perspective, we see first quarter revenues being our lowest for the year, likely more than 20% lower than the first quarter of 2020. This decline is primarily due to significantly reduced industrial service revenues compared to the record results in 1Q 2020 as industrial customers are still dealing with lower demand stemming from decreased global travel activity associated with the pandemic, as well as reduced contributions from lower -- larger pipeline projects.

Revenues should increase sequentially into the third quarter then seasonally decline in the fourth quarter. Quarterly revenues for the second through the fourth quarters are expected to be higher on a quarter-over-quarter basis as compared to 2020 with double-digit growth expected for each quarter. Operating margin improvement for this segment continues to be a focus for us. We see segment margins ranging between 5.5% and 6% led primarily by continued execution within our gas LVC operations. Our full year margin expectations include a breakeven contribution from our industrial services operations in 2021, due to the continued challenging environment. However, to put our current segment margin guidance in context, if our industrial operations contributed at historical pre-COVID margin levels, our segment margin guidance would increase by over 100 basis points.

Consistent with years past and similar to electric power, our first quarter traditionally has lower activity in this segment due to weather seasonality, which impacts our revenues and pressures margin. With current inclement weather across much of the U.S. further pressuring those operations, we expect first quarter margins between breakeven and a small loss. However, we expect solid improvement into the second and third quarters with a seasonal decline in the fourth quarter. These segment operating ranges support our expectation for 2021 annual revenues of $11.95 billion to $12.35 billion and adjusted EBITDA, a non-GAAP measure of between $1.09 billion and $1.19 billion. This represents 8% growth at the midpoint of the range when compared to 2020’s record adjusted EBITDA. With these operating results, we estimate our range of GAAP diluted earnings per share attributable to common stock for the year to be between $3.16 and $3.66 and anticipate non-GAAP adjusted diluted earnings per share to be between $4.02 and $4.52.

Turning to cash flow, we expect free cash flow for 2021 to range between $400 million and $600 million with the standard disclaimer that quarterly free cash flow is subject to sizable movements due to various customer and project dynamic that occur in the normal course of operations. Included in our free cash flow expectation is the anticipated payment of $54 million in the fourth quarter related to payroll taxes that were deferred in 2020. As we have discussed during prior investor events, our cash flow generation moves counter to our revenue growth rates. For instance, a large driver of our significant free cash flow in 2020 was reduced revenues of approximately $900 million compared to 2019, decreasing working capital needs. However, higher revenue growth, like we're guiding for 2021 will likely require a meaningful investment in working capital to support the growth. While our 2021 free cash flow may be negatively impacted by increased working capital required to support our return to 2019 revenue levels, we believe that consistent, sustainable growth profile and solid margins of our base business provides for repeatable levels of free cash flow generation in line with our 2021 guidance in future periods. For additional information, please refer to our outlook summary which can be found on the IR website at quantaservices.com.

Looking back on our 2020 performance, although there were headwinds to the year, we ended the year with $11.2 billion in revenues, which represents an 8.1% revenue CAGR since 2015. More importantly, we ended the year with slightly over $1 billion of adjusted EBITDA, a record for Quanta and equal to our goal established five years ago, which represents a nearly 15% CAGR since 2015. Lastly, our record adjusted EPS of $3.82 represents a 28% CAGR since 2015, with our adjusted EPS growing faster than profits, which are growing faster than revenues. Over the last five years, we have deployed approximately $1.4 billion in cash for M&A and strategic investments, and $760 million for stock repurchases. While we acquire $250 million of common stock in 2020 and $7 million of common stock through February 24, 2021, we have approximately $530 million of availability remaining on our current stock repurchase program. Our first capital priority remains supporting the growth of our business through working capital and capital expenditures, however, we remain committed to the deployment of remaining available capital to stockholders through our stock repurchase and dividend programs and we continue to expect opportunistic acquisitions.

Our $1 billion bond offering in 2020 established a fixed level of debt that nicely complements our current EBITDA profile, which we believe is a repeatable, sustainable baseline of earnings. Simultaneously, we secured an expanded credit facility further enhancing our ability to meet incremental capital needs. Overall, we remain confident in the strength of our operations, our prospects for profitable growth, and the repeatable and sustainable nature of our core markets. We've developed a platform for Quanta to capitalize on the trends driving the spend in our markets, and we firmly believe delivering base business solutions to world class craft skilled labor, optimistic larger project deployments, and continued balance sheet strength will be the key to delivering long-term shareholder value. This concludes our formal presentation and we will now open the line for Q&A. Operator.

[Operator]

[Operator Instructions]. Our first question is coming from Noelle Dilts of Stifel. Please go ahead.

[Noelle Dilts, Stifel Nicolaus]

Hi guys, good morning and congrats on a great quarter. Could you just expand a little bit on how things are progressing in Puerto Rico, how we're looking at the transition over to kind of full scale operations there and any change in how you're thinking about some of the opportunities around construction projects in the region? Thanks.

[Duke Austin, President, CEO, and COO]

Yeah, in Puerto Rico we're making progress, we are staying on task on the timeline that we set forth within our bid process. And so I think we're making great strides there. We're continuing to transition the labor force as well as everything that comes with that from remediation plans and capital plans on the PREPA side of the business. And I -- from my standpoint, I think the third quarter sometime is when we expect to fully transition over into commencement. If not, it will just -- we have a supplemental agreement that will continue and will stay in the supplemental agreement. But the numbers and what we put forth does not change. We continue to be optimistic about the progress we're making as well as what we're doing for the island, the people. We've got our training facility very close to opening so we're seeing a lot of progress there and momentum around what we can do for the island, as far as the people as well as the economics for the island. So everything's on track, going well.

[Noelle Dilts, Stifel Nicolaus]

Okay, great. And then obviously kind of a lot of positive drivers on the electric T&D side. I guess, a couple of questions there; first, I think some of the grid hardening work that was particularly around fires that was kind of planned for 2020, maybe then pushed off -- could you -- had been pushed off, can you comment on how you're thinking about that for 2021? And then just kind of any thoughts on some of the Biden administration's goals around renewable energy and the potential for an infrastructure bill, sort of how are you thinking about one, the potential for an infrastructure bill, and if you could see some grid related initiatives there given the administration's initiative? Thanks.

[Duke Austin, President, CEO, and COO]

Yeah, so I'll take the wild fire question to the West first. When we looked at it last year, we knew in our mind we have one of our larger utilities out there was coming out of bankruptcy, as well as putting a management team in. They are still putting that management team in place. We said all along that if we weren't working on that, we would be working somewhere in the West, that's still the case. It has not -- the demand for our services and what we're doing there from a solution provider to the wildfire assessment, as well as the construction thereafter still remains. I think it's a long-term build in the West around hardening, modernization, and all the things that are necessary when you want to move to more of a carbon free environment. And when we look at that to the West, I think they're a little farther along in their anticipation of being there. So we are still backed up by quite a bit of gas in the region. So I continue to believe that we'll continue to see modernization of that infrastructure as well as hardening for wildfires to the west. And the way we looked at it this year is, we took the normal approach, the same one we've taken in years past, and if we're not busy on the wildfire piece of it we will be busy doing other things in the West. So, I think all that's anticipated. If we start to move and expedite that it would be in the latter half of the year, and we comment on it as a move forward, move upward. So we took a prudent approach to that.

As far as the Biden administration, we've done well under both administrations. It doesn't, whether it be Republican or Democrat, we're really agnostic to that. When we look at it, I think if they follow the energy plan of the 2030-2050 type timeframe, as far as moving to a more carbon free footprint and certainly drives our business, I don't think that sentiment is going away. So we continue to see momentum around renewables and carbon free types of environment, whether it be hydrogen, batteries, whatever it may be that sentiment is there. The administration is certainly pushing that and I think it's beneficial for Quanta on all fronts. So that's where we [spend] [ph].

[Noelle Dilts, Stifel Nicolaus]

Thank you.

[Operator]

Thank you. Our next question is coming from Sean Eastman of KeyBanc Capital Markets. Please go ahead.

[Sean Eastman, KeyBanc Capital Markets]

Hi, gentlemen. Nice work all around, great job. I wanted to start on the underground utility margins. So they're set at 5.5% to 6% for 2021. I think you said it would be a 100 basis points better if we had a normalized contribution from industrial services. So, I guess firstly, does that just mean we'd be 100 basis points higher if demand for refined products was normalized around the reopening? And second, I mean what is the sort of longer-term trajectory in this segment, maybe you could just refresh us on beyond just a normalization and in a reopening of the economy, what the longer-term target is for this business?

[Duke Austin, President, CEO, and COO]

Yeah. So, I think when we look at the segment and look at what we're trying to accomplish there, we moved it away from large projects into a more of a base business. And you see that happening, as we sit today. When we look at the industrial business what we have it is flat for the year. We do see signs of life there. If the economy comes back, we will get into more normalized industrial sector and see more of the same type of work we've seen over our historical. So if you go back to 2008 and 2009 -- and you look after 2008 and 2009 we have very busy years in industrial space. I expected that will happen. Nothing's changed there, I really liked that business unit, I think we'll grow out of it. We have opportunities where others have left the space. So we continue to see greatest opportunity we've ever had there on a go forward basis. We like it and we'll continue to stay in it.

So again, as Derek commented, we do believe if that gets back and you get in the upper single digits there like it's operated in the past, it will move the whole segment up. And that's what we see. So I -- we're committed to operating this segment in upper single digits. We're making strides to get there every day based on base business and repetitive and resilient type framework with growth to our LDC markets that are regulated markets and that's backing that segment. I will say that the company itself is a portfolio and when you look at those individual segments or operating units that perform that work, it's not they can go perform electric work and do. They perform telecom work and do. So while it looks like in a segment, you get one -- you see it one way, it doesn't mean that we're not fully utilized as a company, and we're not moving forward as a portfolio. So you see the overall margins of the company lift and we've always said that our goal for the company is to be double-digit adjusted EBITDA.

[Sean Eastman, KeyBanc Capital Markets]

Okay, got it. That's helpful Duke and maybe just continuing on the margin discussion with electric power. I guess firstly, is the trajectory from the 11.6 ex LATAM in 2020 to the 10.1 to 10.9 in the guidance for 2021 or just a normalization in storm revenue run rates? And second, I mean, relative to the 10.1 to 10.9, I mean, it seems like, LUMA in the out year, a full transition contribution in the out year is a tailwind, it seems like telecom is exiting -- is going to exit 2021 at a higher run rate in terms of margin. So, is there potential for expansion beyond this 2021 guidance range for electric power margins around those factors?

[Duke Austin, President, CEO, and COO]

Yeah, I mean, when we look at the margins, and you look at it on a CAGR basis, you go back 20 years. We've operated in kind of double-digits and so for us, that's what we see historically. We have operated above that, we've talked about that. I think when we look at our guidance, we take a prudent approach to it. It's very early, we have seasonality, we have all kinds of events. We did pull back to 200 million of storm guidance. So if that's more obviously that would pick up the segment. We're operating really well there and I think, certainly there's opportunity, but as far as where we sit, the guidance that we gave is prudent. And I think if you look at it over time, that's where we will sit over time on a CAGR basis. So yes, there's always opportunity for us, and we're going to do everything we can to operate above that.

[Derrick Jensen, CFO]

Yeah, Sean, one other bit of color. I mean, no, it's not really right to look at 2020 to 2021 being all as the storm pullback. Clearly, that is a component of it but that's what Duke is saying, the broader aspect of the operating model would average into that 10%. We've got a slide in there trying to illustrate that in the slide deck. And then relative to going forward though, yes, as it relates to the back half of the year performance for 2021 going into 2022 to the extent that you saw more of run rate type dynamics for LUMA in the back half of the year then yes, that would be accretive to thinking about the model going into 2022.

[Sean Eastman, KeyBanc Capital Markets]

Okay, terrific. Thanks for the color and again, nice work. Thanks, guys.

[Operator]

Thank you. Our next question is coming from Andy Kaplowitz of Citigroup. Please go ahead.

[Andy Kaplowitz, Citigroup]

Hey, good morning, guys.

[Duke Austin, President, CEO, and COO]

Good morning Andy.

[Andy Kaplowitz, Citigroup]

Duke, can you update us on where you are in terms of your focus on capturing more of your customers programming -- programmatic spend, it looks like your estimated orders under MSA is within electric power up dramatically, which is a major reason for the positive move in your power -- electric power backlog in 2020. So would you expect that to continue to move up in 2021 and are you generally seeing customers more willing to outsource more of their operations to you given labor scarcity and job complexity?

[Duke Austin, President, CEO, and COO]

No, we pride ourselves in self performance and kept craft skilled labor. And I think right now that is tight in the marketplace, in our training facilities, and the things that we've done allow us to collaborate with our customers there. So it's really driving the front side of the business and our ability to capture in a more holistic manner, the full value chain that we see in end to end solutions on utility base. So yes, I think we're making great progress there. I think it's something that we said we were going to do and pride ourselves going forward, and it will drive the business forward. So, the capital spends are also getting longer, when we talk about it, when we're talking to customers, our MSAs are lengthening, not getting shorter. So we're seeing more multi-year type MSAs versus one year basically to make sure that they had the craft skill labor and the ability to perform that CAPEX, OPEX on a go forward basis. And I like our position. I think we're doing very well on the utility side of the business as far as capturing more the front side.

[Andy Kaplowitz, Citigroup]

Duke, that's helpful. And then you mentioned large projects in Canada in electric power contributing a little more in terms of revenue in 2021. So could you talk about the duration of these projects, I think they'll burn revenue in 2022 and then, given all the focus on energy transition and renewables, are you at least having more conversations at this point regarding larger transmission work, so when your bigger Canadian projects and you should be able to replace them and/or further grow in large transmission?

[Duke Austin, President, CEO, and COO]

I mean, when we look at North America, if the sentiment stays to renewables and we continue down the path, there's no way around not putting in large transmission to move load-to-load centers. I think it's whether it be Canada or North America we will continue to see those type dynamics stack onto the base business as we move forward. The projects that are in Canada are performing well. And I -- at some parts of it will end in 2022 and parts of it will end in 2023. So it's a good base for us in Canada. We do see opportunities beyond that and other areas as well. So we continue to kind of see that. And as far as kind of the magnitude, we still see well above the 3 billion type framework in large projects of opportunity. And I think that continues on. It's well above that. I will just comment to that so no one will get excited that it's not that, above that so as we move forward.

[Andy Kaplowitz, Citigroup]

Good color, appreciate it Duke.

[Operator]

Our next question is coming from Alex Rygiel of B. Riley FBR. Please go ahead.

[Alex Rygiel, B. Riley FBR Capital Markets]

Thank you and good morning, gentlemen. With regard to the revenue guidance for 2021 of 7% to 10%, what’s the anticipated contribution from acquisitions completed in 2020 as well as ones completed early in 2021?

[Derrick Jensen, CFO]

I would say that the incremental is probably around 200 or so for the full complement of acquisitions in 2020.

[Alex Rygiel, B. Riley FBR Capital Markets]

And then, as you think about capital allocation in 2021, can you quantify or bracket sort of what you're targeting for acquisitions in the coming year either from a revenue contribution basis or capital to purchase those businesses?

[Derrick Jensen, CFO]

Yeah Alex, I think the strategy remains the same. You'll see us continuing to -- obviously, we're evaluating everything against the stock and what we can do with that and our organic growth. So we'll continue to make sure that we invest back in the business as far as working capital, where we still see plenty of acquisition type targets out there that come through. We're not hard pressed to make acquisitions but if we see the right company, management teams will certainly lean into them as we have in the past. And I think that will also be additive to anything we're trying to accomplish from a strategy standpoint. And I do think when we look at the way the company is running and the way that the capital allocation happens going forward, it does allow us to start thinking really -- the opportunity certainly for double-digit EPS growth year-over-year. And so we've seen much more than that and if you go back on a five year CAGR basis, it's much more than that. You see our guidance this year more than that. So I do think the company's ability to lean in and to pull all levers of the balance sheet to move us forward is certainly there and you'll see us do that.

[Derrick Jensen, CFO]

Another way to fix that is to go back and look at our averages. I mean, you see that we averaged probably around 400 million or more in deployment of capital and acquisitions over the last four or five years.

[Alex Rygiel, B. Riley FBR Capital Markets]

Thank you.

[Duke Austin, President, CEO, and COO]

Thank you.

[Operator]

Thank you. Our next question is coming from Steven Fisher of UBS. Please go ahead.

[Steve Fisher, UBS]

Thanks and good morning. Just on the cash flow, your guidance of about 45% conversion of EBITDA seems a little bit higher than you were previously talking about when you get growth going into sort of the upper single-digits on a revenue basis. So I guess, is there anything in particular that's taking that cash flow above that maybe 35% to 40% conversion on a kind of a low single-digit, low to mid-single-digit basis or is this now sort of a new normal kind of cash conversion at a better level?

[Duke Austin, President, CEO, and COO]

Yeah, thanks for the question, Steve. Actually, what I'd say is, it is a little bit higher. We ended up the year with probably running about a little over 12% working capital as a percentage of trailing four month revenues. Historically, we were really running probably about 13%. So I think we've done a good job of continuing to get some of that pressure down on the working capital side. I think we can maintain that throughout this year and that will give us a little bit higher conversion rate. As Alex has asked there is a little bit of M&A driving the revenue side, so that would factor the revenue growth up just a little bit. But, we've commented multiple times that in a moderated growth rate kind of that mid-single-digit that we could be in that 40% to 50% type conversion, which is largely what you're seeing with a little bit of an uptick based on expectations of maybe a little bit better cash conversion than what we've seen in recent periods.

[Steve Fisher, UBS]

And then just on the telecom business, just curious what's the bookings potential looks like there, are there any opportunities out there to maybe drive a step function increase in that 900 million backlog it has today or should we now expect that as this business gets a little bit bigger, the growth rate kind of starts to have a moderating trend, both on the revenues and the backlog sides?

[Duke Austin, President, CEO, and COO]

Yeah Steve, I think when we look at the telecom business we see the macro market, it's very good. And I think our ability to book is there, continue to book. What I would say is we've taken a measured approach to make sure that we kept our double-digit margins and hit those targets. And I think we've done that, we've grown it nicely. As long as we can hit kind of the double-digit target margins that we're after, then we'll continue to see the kind of growth rates but it will moderate at some point above big numbers, we'll get there. But in general, the markets there for us to continue to grow that business above the growth rate of the electric segment, for sure. So I think we see that going forward. And our ability -- what's happening with art -- the art work is that's also going in our municipal electric customer. So it's allowing us even more opportunity to grow the business with even our electrics not inside of the business as far as our crew sets and with 5G and the way that that's going into the -- on the electric space certainly it will push our telecom up even farther. So I'm optimistic, the markets good and we're doing well there.

[Steve Fisher, UBS]

Perfect, thank you.

[Operator]

Thank you. Our next question is coming from Jamie Cook of Credit Suisse. Please go ahead.

[Jamie Cook, Crédit Suisse]

Hi, good morning, a nice quarter. I guess my first question back to underground utility infrastructure. Are there any sort of inorganic opportunities that you could do and acquisitions that we could think about in 2021 to somewhat accelerate the margin improvement in this business I know before, or historically Duke you talked about scale and perhaps not enough geographic diversification sort of weighing down on the margins in this business and wondering how opportunistic we can be there versus just waiting for the industrial services business to come back? And then on industrial services, I know you talked about if we normalized you would get margin improvement in that business. I guess what's the revenue growth that you need or can you remind us where industrial services revenues were ended in 2020 versus what you would need to get that margin improvement? Thanks.

[Duke Austin, President, CEO, and COO]

Thanks, Jamie. To be clear, I want to make sure our goal is to operate that segment and we're doing what's necessary to operate that segment in upper single-digits the way it sits. That being said, our crews aren't sitting. I mean, many times they'll go and perform electric work, they'll do other things on the electric segment. So you're seeing the overall margins of the company move up. No matter what class of work they do, a bore rig for example can bore electric one day, gas the next, and telecom the next. So what we're doing is making sure that our offices are fully utilized. So it's driving the overall margins up of the company and we do anticipate that as we continue to grow out the utility side of that LDC business with integrity and pipe replacements that that will continue to be the largest piece of the segment, as well as move up our margin profile and resiliency of the business as we go forward. So those are 30 year builds. We like that business, where you have put in the Eastern seaboard, albeit it had some issues last year, and just now starting to kind of come back to full scale on the eastern seaboard. So I think when we see all that come together, you're going to start to see it move up fairly rapidly. I do think the industrial business when we acquired stronghold, it was around 500 million, we had anticipated that growing to a billion at some point. But that is back to more normalized level. But so when we look at that piece going forward, we like the pieces that are there, their critical path infrastructure, we've not scaled back to operate at the 500 million mark. We still believe when this moves out that there's greater opportunity for us. So we are holding on to some people to make sure that we can fulfill the customer's needs as we move forward. So there is a little drag on margin there in the industrial business by design. We've done it before in other areas, I think it's the right thing to do for the long-term vision that we have for that group.

[Derrick Jensen, CFO]

Jamie, a couple of quick points there. Relative to the differential revenue Duke commented effectively, it's about like a couple $100 million. But I think another point that's worth noting is 2021 expectations are exacerbated by kind of a first quarter effect. Industrial is counter seasonal and so it oftentimes contributes a little bit more into the first quarter than the normal aspect of our business. When you look at the modeling, I think what you'll find is for you to get to a 5.5% to 6% margin profile for underground, based upon the breakeven to small loss in the first quarter. You're going to have to see second, third and fourth quarters operating effectively at around 7%. So it's really right now an exacerbated first quarter dynamic that's really creating the majority of the dilution, but otherwise you're seeing margin execution of that remaining portion of business ex industrial in the back half of the year still at kind of that 7% type plus performance.

[Jamie Cook, Crédit Suisse]

Okay, thank you. I appreciate it.

[Operator]

Thank you. Our next question is coming from Michael Dudas of Vertical Research. Please go ahead.

[Michael Dudas, Vertical Research]

Good morning, all. You had some rough weather down your neck in the woods last week to 10 days. Just share with us how you guys work through that and do you get the sense certainly and be in touch with your utility customers maybe for [indiscernible] area just in general and plus the news and the flow that's happened, is this going to accelerate some of the decisions and the problems that Arcot [ph] had to some other parts of the country and are you -- do you think you're going to get a sense of that here in the next couple months, even especially from a regulatory standpoint, not only just in Texas, but now some of the other regulators around the U.S.?

[Derrick Jensen, CFO]

Yeah, thanks Mike. Thanks for the question. Yeah, we have some weather here for sure and I want to say that our employees, both at the corporate level and in the field does remarkable job of putting earnings out and being safe in the field and getting the lights back on. So that being said, when we look at that I think you're going to have to have some redundancy. No matter what you do, there's intermittency. So whether it be if you're still backed by gas, your pipe that froze out in West Texas you're going to have to see some redundancy and to backup the grid. And now whether you do it with batteries or new pipe, that's certainly there as well as transmission where you had load, you can't bring it out because you are constrained. So I think you're going to see transmission across North America. If we're going to go to more of a renewable sentiment state that's been stated, I've said it before and I'll say it again, the amount of transmission that's necessary to have a robust, redundant system to backup intermittency is large in nature much more than you can anticipate if you go to a European type environment, where you see large corridors of transmission. So I think those spend stay there. Batteries will come into play at some point and be more of take some of that intermittency out, but we're early in batteries as we move forward. So I -- those kind of things to build that modern grid, as you see electric vehicles come on the distribution system, our infrastructure that we have today, we continue to need to invest, to modernize. And you're going to -- our utility customers Capex and OPEX as well as our regulators will continue to put focus on those areas as we move forward.

[Michael Dudas, Vertical Research]

I appreciate that color. Thanks Duke.

[Operator]

Thank you. Our next question is coming from Adam Thalhimer of Thompson Davis. Please go ahead.

[Adam Thalhimer, Thompson Davis]

Hey, good morning guys. Congrats on a strong Q4.

[Duke Austin, President, CEO, and COO]

Thank you.

[Adam Thalhimer, Thompson Davis]

Hey, Duke, on the transmission side in the U.S. and Canada, just at a high level, what are you seeing in the bidding environment out there?

[Duke Austin, President, CEO, and COO]

No, we're really busy. I -- most of the work we have are multi-year agreements across the board. So really, we're in multi type year agreements on the base business, and then your larger work, we continue to see a robust bidding environment and transmission side. And I -- from our standpoint we are certainly positioned well for those larger projects, both in Canada and lower 48. So it's a robust environment.

[Adam Thalhimer, Thompson Davis]

And then I guess, sort of the same question on the gas side, where are you in your plans to kind of grow the base business on the gas side with gas utilities adding MSAs?

[Duke Austin, President, CEO, and COO]

I mean, we're adding MSAs pretty much every year, probably every quarter for that matter. And it's really about us having the qualified personnel and continuing our training programs to get the folks in the field and remain productive and make sure that we keep our margin profile up and don't go past our margins. So it's more about a margin issue than the amount of macro work from a macro standpoint and not work that's out there. So, we'll be prudent about how we step into the gas piece of the LVC market, utility market. But it is certainly there and growing and I think we've grown it kind of upper single-digits to double-digits year-over-year, and you'll continue to see that.

[Derrick Jensen, CFO]

Maybe -- well, one way to think about it, aggregate MSAs are now -- as it relates to the end of 2020 we're just about 50% or just over 50% of revenues, which has definitely grown from what you've seen three or four years ago.

[Adam Thalhimer, Thompson Davis]

Yeah, good stat. Thanks, Derrick.

[Operator]

Thank you. Our next question is coming from Chad Dillard of Bernstein. Please go ahead.

[Chad Dillard, AllianceBernstein]

Alright, good morning guys. So my question is on the telecom margins and you guys are guiding to I guess, kind of in line with the segment levels through this year and on the revenue side, you are guiding about $700 million. I am just trying to understand, what sort of incremental leverage do you have going from this $700 million this year to your eventual $1 billion run rate and is there a potential upside beyond the second average for telecoms?

[Duke Austin, President, CEO, and COO]

I think, again, when you see portfolio approach there when you start to use electric crews to not only for electric work, but also telecom work, you get some synergy there that would increase the margins on the telecom side. So as that comes into play in the years beyond when we start looking more 5G in the rural areas, I think you'll start to see margins increase as we go forward. And it's about utilization, PP utilizations and scale with offices from a managerial standpoint as well as a fleet standpoint. So the returns get better as well.

[Chad Dillard, AllianceBernstein]

It's helpful and just a bigger picture question. So how much will gas transportation and distribution infrastructure need to change and how do you get introduced as a bigger part of the energy mix, just what infrastructure is on the pipe side and are there any parallels you can draw versus what we saw on the Shale gas revolution about a decade ago and in terms of the capabilities that Quanta is there anything you can be [indiscernible] in terms of natural skillset, geographic focus or customer coverage to realize opportunities ahead there?

[Duke Austin, President, CEO, and COO]

Yeah, I think when you look at the segment, you look at as far as the gas distribution and hydrogen and how it mixes in. It's certainly more corrosive. So, when you're starting to blend it, we're working on those blends and things of that nature today. So that corrosiveness will cause work as well. So we see that going forward, it's early in my mind and we're still working on how that interacts in my mind with what's going on today, but we continue to see gas being utilized in new areas, as well as replacements in our older areas to reduce methane emissions. So that's been something that has gone somewhat unnoticed is the methane emissions that it's caused today from leak prone pipe, that's no longer there. So I think we're doing a good job from the environmental aspect as well by replacing it. And so I think about it like the systems that are in place are very valuable, because it's very difficult to build a new system today. And so the ones that are in place, what will happen is the integrity piece of our business will continue to flourish as we move forward due to you're using an older pipe because it's too difficult to build new pipe. So we'll continue to see our integrity piece move up. And we're looking at that as a strategy as we go forward.

[Chad Dillard, AllianceBernstein]

Thank you.

[Operator]

Thank you. Our next question is coming from Brent Thielman of D.A. Davidson. Please go ahead.

[Brent Thielman, D.A. Davidson]

Hey, great. Thank you and congrats on a great quarter and great year. Maybe similar to the last question, these themes of clean energy, electrical vehicles, and the infrastructure needed for that, they are meaningful for your business over the long-term, are there other capabilities or services that you don't have today that could be of interest to leverage those themes more, whether that's direct engagement in renewables development or things around the EV infrastructure arena, just wondering if you're looking at any of those sorts of things and sort of supplemental growth opportunities to the core business?

[Derrick Jensen, CFO]

Yeah, when you think about everything that you've said, whether it be electric vehicles, automated vehicles, technology, renewables, hydrogen, we're in conversations and collaborations with helping build the modern infrastructure necessary to enable every one of the things that you hear every day. So the company is in a unique position to enable all those things to happen, whether it be electric vehicles on the distribution systems, to make sure that not only can we put charging stations in, but we can also make sure that grid behind it can handle the amount of electric vehicles that are going to be charging on a daily basis. And the intermittency that it causes is a tremendous step forward within the distribution systems that we see today on the electric side. Technology on the telecom side, as we move into 5G, the company is in a very unique position there to deploy resources there. So I think any way you look at it from a sentiment standpoint and how we're becoming more sustainable going forward as well as environmental friendly from a company, we're enabling all those things to happen.

[Brent Thielman, D.A. Davidson]

Okay, appreciate that. And then on communications, sorry if you touched on this earlier, but I guess I'm wondering with the completion of the C Band action, whether that's leading to much more meaningful dialogue with customers just around the build out of infrastructure, maybe what are you hearing from them now, now that that's completed?

[Duke Austin, President, CEO, and COO]

I think we still see the same. I mean, it's a robust conversation on a daily basis about what's going to happen. Obviously, there's been with the pandemic some of the plants have moved and you see more fiber pushing into your suburbs. So that's certainly something that we see but on a go forward, the capital spends there are there and I think we're well positioned to take advantage of that as we move forward.

[Brent Thielman, D.A. Davidson]

Okay, thank you.

[Duke Austin, President, CEO, and COO]

Thank you.

[Operator]

Thank you. Ladies and gentlemen, at this time, I'd like to turn the floor back over to management for any additional or closing comments.

[Duke Austin, President, CEO, and COO]

Yeah, I want to congratulate the company and the management teams that we have. They're exceptional. We've performed very, very well in tough conditions as well as the corporate office to push out earnings in tough times. And so I commend everyone in the organization. And I want to thank you for participating in the call. We appreciate your questions and ongoing interest in Quanta Services and thank you. This concludes the call.

[Operator]

Ladies and gentlemen, thank you for your participation. You may disconnect your lines and log out of the webcast at this time and have a wonderful day.