NORWALK, Conn.–(BUSINESS WIRE)–EMCOR Group, Inc. (NYSE: EME) today reported results for the second quarter ended June 30, 2021.
For the second quarter of 2021, net income was $97.4 million, or $1.78 per diluted share, compared to a net loss of $83.7 million, or $(1.52) per diluted share, for the second quarter of 2020. The net loss for the second quarter of 2020 included after-tax goodwill, identifiable intangible asset, and other long-lived asset impairment charges, related to our U.S. Industrial Services segment. Excluding these impairment charges, non-GAAP net income for the second quarter of 2020 was $79.2 million, or $1.44 per diluted share. Revenues for the second quarter of 2021 totaled $2.44 billion, up 21.0% from the second quarter of 2020.
Operating income for the second quarter of 2021 was $133.4 million, or 5.5% of revenues, compared to an operating loss of $122.6 million, or (6.1)% of revenues, for the second quarter of 2020. Excluding pre-tax impairment charges of $232.8 million in the prior year period, non-GAAP operating income for the second quarter of 2020 was $110.1 million, or 5.5% of revenues.
Selling, general and administrative expenses for the second quarter of 2021 totaled $242.9 million, or 10.0% of revenues, compared to $205.2 million, or 10.2% of revenues, for the second quarter of 2020.
Please see the attached tables for a reconciliation of non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, and non-GAAP diluted earnings per share to the comparable GAAP measures.
The Company’s income tax rate for the second quarter of 2021 was 26.8% compared to an income tax rate of (32.5)% for the second quarter of 2020.
Remaining performance obligations as of June 30, 2021 were $5.11 billion compared to $4.59 billion as of June 30, 2020. Total remaining performance obligations grew approximately $515.8 million year-over-year.
Tony Guzzi, Chairman, President, and Chief Executive Officer of EMCOR, commented, “The Company once again delivered exceptional performance, with record second quarter revenues, gross profit, operating income, net income, and diluted earnings per share, building upon an already strong start to the year. We achieved outstanding revenue growth of 21.0% year-over-year, 18.4% of which was organic, and our continued operational execution enabled us to deliver a healthy operating income margin of 5.5%. Despite the uncertain environment we have seen over the last year, our remaining performance obligations increased 11.2% year-over-year to a record $5.11 billion, demonstrating resilient demand for our services across our geographies and end markets.”
Mr. Guzzi added, “Our U.S. Construction segments continue to perform exceptionally well, generating combined year-over-year revenue and operating income growth in the quarter of 20.6% and 23.7%, respectively, driven by broad-based growth across our trade offerings, end market sectors, and geographic footprint. Our U.S. Building Services segment was also a highlight during the quarter, with double-digit year-over-year revenue and operating income growth of 30.4% and 13.9%, respectively, led by HVAC retrofits, particularly energy efficiency and IAQ projects, coupled with the strong performance of our commercial site-based business. Our U.S. Industrial Services segment continues to face a difficult operating environment. However, we expect performance to improve as customer inquiries and scheduling have increased as we move into 2022. Finally, we are pleased by the sustained strength in our U.K. Building Services segment, which delivered year-over-year revenue and operating income growth of 39.5% and 31.7%, respectively, during the quarter, driven by continued execution for our customers, and partially aided by favorable foreign exchange rate movement.”
Revenues for the first six months of 2021 totaled $4.74 billion, an increase of 9.9%, compared to $4.31 billion for the first six months of 2020. Net income for the first six months of 2021 was $182.1 million, or $3.32 per diluted share, compared to a net loss of $8.0 million, or $(0.14) per diluted share, for the first six months of 2020. Excluding the after-tax impact of the previously referenced impairment charges in the prior year, non-GAAP net income for the first six months of 2020 was $154.9 million, or $2.78 per diluted share.
Operating income for the first six months of 2021 was $250.4 million, representing an operating margin of 5.3%, compared to an operating loss of $16.6 million, representing an operating margin of (0.4)%, for the first six months of 2020. Excluding the prior year impairment charges, non-GAAP operating income for the first six months of 2020 was $216.1 million, representing a non-GAAP operating margin of 5.0%.
Selling, general and administrative expenses totaled $467.0 million, or 9.8% of revenues, for the first six months of 2021, compared to $432.2 million, or 10.0% of revenues, for the first six months of 2020.
Please see the attached tables for a reconciliation of non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, and non-GAAP diluted earnings per share to the comparable GAAP measures.
Based on year-to-date performance and assuming a gradual improvement of current market conditions as the year progresses, EMCOR is raising its full-year 2021 revenue guidance to approximately $9.5 billion, an increase from the prior guidance range of $9.2 billion to $9.4 billion. The Company now also expects full-year 2021 diluted earnings per share in the range of $6.65 to $7.05, an increase from the prior guidance range of $6.35 to $6.75.
Mr. Guzzi concluded, “Our strong first half results, robust remaining performance obligations, and improved visibility are encouraging and, as a result, we are raising our full year 2021 guidance for revenue and diluted earnings per share. As always, we continue to focus on the elements of our business that we can control, protecting the health and safety of our employees, and adjusting our operations as necessary in a disciplined manner aligned with our customer commitments and opportunities. Moving forward, we will continue to execute on our balanced capital allocation strategy, utilizing our healthy balance sheet to invest in organic growth, pursue strategic acquisition opportunities, and maintain our commitment to returning capital to shareholders through share repurchases and dividends.”
EMCOR Group, Inc. is a Fortune 500 leader in mechanical and electrical construction services, industrial and energy infrastructure and building services. This press release and other press releases may be viewed at the Company’s website at www.emcorgroup.com. EMCOR routinely posts information that may be important to investors in the “Investor Relations” section of our website at www.emcorgroup.com. Investors and potential investors are encouraged to consult the EMCOR website regularly for important information about EMCOR.
