Strong Revenue Growth
Total revenue of $1.0 billion in 1Q26, up $167 million or 20% year-over-year.
MYR Group
· MYRG
April 29th, 2026
Summary
- Earnings Call Date:
- 2026-04-29
- Change Since:
- +39.18%
- Next Earnings Date:
- 2026-07-29
Earnings Call Sentiment
PositiveThe call conveyed a strongly positive operational and financial performance for 1Q26: robust top-line growth (+20% YoY), record net income and EBITDA, margin expansion across segments, record backlog, solid liquidity and conservative leverage. Management also provided constructive guidance (~12% revenue growth for the year and higher target margin ranges) and cited durable demand drivers (electrification, data centers, water/wastewater, grid modernization). Near-term headwinds include isolated project inefficiencies that increased costs, a modest rise in SG&A, slightly lower free cash flow due to higher CapEx expectations (~3% of revenue), potential DSO pressure from higher MSA mix, and timing/lumpiness of large project starts (some not generating revenue until 2027). Overall, the positives materially outweigh the negatives.
Company Guidance
Management updated forward-looking expectations for 2026 with organic revenue growth of roughly 12% for the year (vs. the ~10% per‑segment expectation entering the year), operating margin targets of 6%–9% for C&I and 8%–11% for T&D (aiming to operate near the mid‑points), CapEx trending to about 3% of revenue, and DSO that could rise from the mid‑50s toward the low‑60s; liquidity and balance‑sheet metrics remain strong with $163M cash, $460M borrowing availability, $258M of working capital, $9M funded debt and a funded‑debt/EBITDA ratio of 0.04x, while backlog was a record $2.84B (T&D $981M; C&I $1.86B).
Segment Revenue Strength — T&D and C&I
T&D revenue of $541 million (+17% YoY). C&I revenue of $459 million (+24% YoY), a record quarter for the C&I segment.
Improved Gross and Operating Margins
Gross margin improved to 13.4% from 11.6% YoY (+1.8 percentage points). T&D operating margin increased to 9.7% from 7.8% (+1.9 ppt). C&I operating margin rose to 8.1% from 4.7% (+3.4 ppt).
Record Profitability Metrics
Record net income of $47 million vs $23 million a year ago (net income and EPS roughly doubled). Diluted EPS $2.99, up 106% YoY. Record EBITDA of $82 million vs $50 million YoY.
Backlog Expansion
Total backlog reached a record $2.84 billion as of March 31, 2026, up 8% year-over-year (T&D backlog $981 million; C&I backlog $1.86 billion).
Strong Cash Position and Leverage
Operating cash flow of $85 million (vs $83 million YoY) and free cash flow of $69 million. Cash and equivalents $163 million, borrowing availability $460 million, funded debt $9 million, and funded debt-to-EBITDA leverage improved to 0.04x.
Positive Commercial Momentum and Awards
Multiple new awards and MSAs across geographies and segments (including MSAs in Arizona, greenfield substations in Texas, 345 kV projects), plus multiple data center and water/wastewater project wins driving C&I growth.
Improved Contracting and Execution (Prefab and Risk Management)
Management highlighted better contract terms, reduced risk in contracts, increased prefabrication/kitting and improved productivity as contributors to higher margins and execution reliability.
Upgraded 2026 Outlook and Margin Targets
Management expects ~12% revenue growth for the year (company-wide) and updated operating margin target ranges: C&I ~6%–9% and T&D ~8%–11%, with a goal to operate in the mid-points of those ranges.
Operator
Good morning, everyone, and welcome to the MYR Group First Quarter 2026 Earnings Results Conference Call. [Operator Instructions] Today's conference is being recorded. I will now turn the call over to Jennifer Harper, Vice President of Investor Relations and Treasurer, for introductory remarks.
Jennifer Harper
Thank you, and good morning, everyone. I would like to welcome you to the MYR Group conference call to discuss the company's first quarter results for 2026, which were reported yesterday. Joining us on today's call are Rick Swartz, President and Chief Executive Officer; Kelly Huntington, Senior Vice President and Chief Financial Officer; Brian Stern, Senior Vice President and Chief Operating Officer of MYR Group's Transmission and Distribution segment; and Don Egan, Senior Vice President and Chief Operating Officer of MYR Group's Commercial and Industrial segment. A copy of yesterday's press release announcing our first quarter results can be found on the MYR Group website at myrgroup.com under the Investors tab. A webcast replay of today's call will be available on the website for 7 days following the call. Please note, today's discussion may contain forward-looking statements. Any such statements are based upon information available to MYR Group's management as of this date, and MYR Group assumes no obligation to update any such forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements.
Accordingly, these statements are no guarantee of future performance. For ...
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