MasTec sees Q1 EBITDA margin profile ‘relatively similar’ to prior year

MasTec CFO George Pita said while speaking at the Credit Suisse Global Industrials Conference: "As we go forward, we’ve talked to folks — the exciting thing about MasTec today is that while we’ve had a difficult ’22, we really have, in the last 2 years, positioned the company, we think, for extraordinary growth opportunities from both a revenue perspective and a margin perspective. And third quarter, I think we started to exhibit some of that. And we anticipate that will continue now with the acquisition of IEA… So consequently, with the timing of the IEA acquisition, we kind of gave some directional views. We haven’t given official guidance for 2023. But — we did talk directionally about views that we thought were top line and EBITDA would go. And within that, we’ve talked about our top line that we think we’ll approach $13 billion next year compared to this year’s $9 billion and change. And that EBITDA should be approaching 9%, and we’re very comfortable with that view. What becomes a little bit more challenging sometimes is then getting the cadence, right? And when you look at the cadence, I think the first quarter for a couple of different reasons, right? One, which I think oil and gas will be incurring some startup costs for activity that’s going to happen late in the second quarter into the third. And the fact that when you look at the cadence of how our business is going to transition with the addition of EA, we’re going to add a pretty sizable amount of revenue in the first quarter at a low single-digit margin profile. So consequently, I look at the first quarter and think we’re going to have a good sizable top line growth. I think our EBITDA margin profile will be relatively similar first quarter of ’23 compared to first quarter of ’22. That said, I think second quarter is much better, and I’ll have a first half that’s improved. But I do think more of my EBITDA improvement year-over-year is going to come in the second half than in the first half. Other thing I’d say from a modeling perspective for folks just to consider, because there’s been so much transition in our portfolio and the acquisitions is you need to consider the level of interest costs, which are obviously going to be much higher as we’ve added debt here for the IEA acquisition. Over the course of ’23, we will delever and pay down debt, but that will be a process."