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IES Holdings, Inc. (IESC)·Q4 2024 Earnings Summary

Executive Summary

  • Fiscal Q4 2024 delivered strong year-over-year growth: revenue $776 million (+20%), operating income $75.0 million (+41%), diluted EPS $3.06 (+84% vs $1.66) and adjusted diluted EPS $2.79 (+60% vs $1.74), supported by robust demand across data-center-exposed segments and continued execution improvements .
  • Backlog reached a record ~$1.8 billion with remaining performance obligations of ~$1.2 billion, underscoring visibility into FY2025; RPO/backlog were stable to higher sequentially through Q4 .
  • Capital strength and allocation remain a differentiator: no debt, cash $100.8 million, $198.1 million remaining under a $200 million buyback authorization; management reiterated plans to deploy capital for acquisitions, organic expansion, and select investments .
  • FY2025 setup: management expects continued strength in Communications, Infrastructure Solutions and C&I (data centers) but is cautious on near-term single-family demand in Residential; C&I revenue expected to dip in Q1 FY2025 as a large project winds down, then ramp in Q2 on new backlog .
  • Street consensus comparison unavailable due to S&P Global data access limits; investors should focus on segment-level momentum, backlog, and near-term Residential/C&I cadence as key drivers of estimate revisions [GetEstimates error; SPGI daily limit exceeded]*.

What Went Well and What Went Wrong

What Went Well

  • Broad-based strength: all four segments grew in FY2024 with margin expansion; Q4 operating income increased materially on revenue growth, strong execution, improved capacity utilization, and favorable materials purchasing (“favorable impacts of materials purchases”) .
  • Data center demand: Communications, Infrastructure Solutions and C&I benefitted from sustained data center momentum; Infrastructure Solutions saw 62% FY revenue growth and 131% FY operating income growth, aided by capacity investments and the Greiner acquisition .
  • Cash generation and balance sheet: operating cash flow of $234.4 million in FY2024, ending with no debt and $100.8 million cash, after funding acquisitions, expansion capex, buying Bayonet’s retained interest, investing $33 million in marketable securities, and repurchasing $39 million of stock .

What Went Wrong

  • Near-term Residential caution: management flagged single-family affordability pressures and potential buyer delays into FY2025 despite long-term optimism; Florida operations saw hurricane-related disruption expected to modestly impact Q1 FY2025 revenues .
  • C&I near-term cadence: a large data center project substantially completed by Q4; management expects a Q1 FY2025 revenue reduction before revenue increases in Q2 as new projects ramp .
  • Corporate costs and tax dynamics: corporate operating loss widened (Q4 corporate -$12.8 million) and adjusted tax normalization reduced non-cash benefits compared to prior periods, impacting adjusted metrics presentation .

Financial Results

Consolidated Performance (Quarterly)

MetricQ2 2024Q3 2024Q4 2024
Revenue ($USD Millions)$705.8 $768.4 $775.8
Gross Profit ($USD Millions)$171.6 $194.8 $186.4
Operating Income ($USD Millions)$77.7 $90.2 $75.0
Net Income Attributable to IES ($USD Millions)$52.9 $62.1 $63.1
Diluted EPS ($USD)$2.29 $2.67 $3.06
Adjusted Diluted EPS ($USD)$2.29 $2.67 $2.79
Adjusted EBITDA ($USD Millions)$83.1 $97.7 $84.9

Notes: Adjusted metrics reflect non-GAAP reconciliations provided in company materials .

Segment Revenue (Quarterly)

Segment Revenue ($USD Millions)Q2 2024Q3 2024Q4 2024
Communications$193.6 $192.3 $219.9
Residential$339.3 $377.5 $356.1
Infrastructure Solutions$75.8 $102.0 $110.4
Commercial & Industrial$97.0 $96.6 $89.4
Total$705.8 $768.4 $775.8

Segment Operating Income (Quarterly)

Segment Operating Income ($USD Millions)Q2 2024Q3 2024Q4 2024
Communications$21.9 $21.0 $22.6
Residential$34.7 $43.7 $34.8
Infrastructure Solutions$16.1 $19.8 $20.7
Commercial & Industrial$11.7 $13.0 $9.7
Corporate($6.7) ($7.3) ($12.8)
Total$77.7 $90.2 $75.0

KPIs: Backlog and Remaining Performance Obligations (RPO)

KPI ($USD Millions)3/31/20246/30/20249/30/2024
Backlog$1,363 $1,697 $1,786
Remaining Performance Obligations$1,065 $1,177 $1,176

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Residential Single-Family DemandFY2025 near-termNot specifiedCautious on affordability; potential buyer delays; long-term housing demand optimistic Maintained cautious stance
C&I Segment RevenueQ1 FY2025 to Q2 FY2025Not specifiedExpect Q1 revenue reduction; revenue to increase in Q2 as new projects ramp Lowered near-term, then improving
Communications Demand (Data Centers)FY2025Not specifiedContinued strong demand expected Maintained positive
Infrastructure Solutions Demand (Data Centers)FY2025Not specifiedContinued strong demand; capacity investments driving efficiencies Maintained positive
IT/ERP InvestmentFY2025Not specifiedExpect increased expenditures on IT solutions; ongoing ERP implementation Raised spending
Capital DeploymentFY2025Not specifiedContinue deploying capital for acquisitions, organic expansion and select investments Maintained
Florida Operations (Hurricane Milton)Q1 FY2025Not specifiedExpect only minor impact on Residential Florida revenues Maintained
Share Repurchase AuthorizationOngoing$200 million authorized July 31, 2024$198.1 million remaining at 9/30/2024 Capacity available

Note: No explicit numerical revenue/EPS ranges provided in Q4 materials .

Earnings Call Themes & Trends

Note: An earnings call transcript for Q4 2024 was not available in our document catalog or public IR site; themes below reflect management commentary across Q2–Q4 press releases .

TopicPrevious Mentions (Q-2 and Q-1)Current Period (Q4 2024)Trend
Data Center DemandStrong demand benefiting Communications, Infrastructure Solutions, and C&I; improved pricing and execution Continued strong demand expected into FY2025, particularly in data center end markets Consistently strong
Residential HVAC/Plumbing ExpansionExpansion driving growth beyond electrical services; market share gains Ongoing expansion planned; cautious near-term demand but long-term optimistic Continuing expansion; mixed near-term
Procurement/Process ImprovementsDisciplined bidding, improved procurement; margin expansion Higher margins across businesses; continued investments in scalability Ongoing improvement
ERP/IT InvestmentsNot a major themeIncreased spend planned on IT solutions and ERP implementation Increasing focus
C&I Large ProjectStrong contribution; nearing completion Project substantially complete; Q1 dip, Q2 ramp on new backlog Transitioning
Capital Allocation/BuybacksNew $200M repurchase authorized; active repurchases $198.1M authorization remaining; continued deployment for M&A and expansion Ongoing
Tax/Cash TaxesHigher cash tax rate after NOL utilization in FY2023 Adjusted tax expense normalization noted in non-GAAP reconciliation Higher cash taxes vs prior year

Management Commentary

  • “In fiscal 2024 we continued to build on the progress we made in 2023, with all four of our operating segments growing revenue while expanding operating margins… reflecting our revenue growth, strong project execution, improved capacity utilization and favorable impacts of materials purchases.” — Jeff Gendell, Chairman & CEO .
  • “We realized the benefits of investments… expanded capacity for our Infrastructure Solutions business, a more coordinated procurement function… better controls and processes around project selection… expect to increase expenditures on information technology solutions… ongoing implementation of our new ERP system.” — Matt Simmes, President & COO .
  • “Operating cash flow of $234.4 million… ended the year with no debt and a cash balance of $100.8 million… acquired Greiner, invested in expansion capex, purchased the 20% retained interest in Bayonet, invested $33 million in marketable securities and repurchased $39 million of stock.” — Tracy McLauchlin, CFO .

Q&A Highlights

  • A Q4 2024 earnings call transcript was not available; management’s detailed commentary is drawn from the press release and earnings presentation .
  • Key clarifications embedded in disclosures: C&I near-term revenue dip in Q1 FY2025 with sequential improvement in Q2; minor hurricane impact in Florida Residential; increased IT/ERP investments for scalability .

Estimates Context

  • S&P Global/Capital IQ consensus estimates for Q4 2024 could not be retrieved due to access limits; therefore, formal beat/miss vs Street is unavailable at this time [GetEstimates error; SPGI daily limit exceeded]*.
  • Near-term models may need to reflect: (a) C&I Q1 FY2025 revenue decline then Q2 ramp from backlog , (b) minor Q1 FY2025 impact in Florida Residential , and (c) continued strength in data-center-exposed segments and ongoing margin/process improvements across units .

Key Takeaways for Investors

  • Record backlog ($1.8B) and stable RPO ($1.2B) support FY2025 visibility, especially in data centers across Communications, Infrastructure Solutions, and C&I .
  • Q4 delivered durable profitability with diluted EPS $3.06 and adjusted diluted EPS $2.79 on solid execution and margin discipline; FY2024 EPS $9.89 and adjusted $9.62 highlight improved earnings power .
  • Capital strength enables continued deployment: no debt, cash $100.8M, $198.1M buyback capacity; M&A (Greiner), organic expansion, and marketable securities add levers for value creation .
  • Watch near-term cadence: C&I revenue dip in Q1 FY2025 from project completion, then ramp in Q2; Residential faces affordability headwinds despite long-term demand optimism and multi-trade expansion .
  • Process and technology investments (procurement discipline, ERP/IT) are driving margin resilience; expect continued scalability benefits in FY2025 .
  • Segment leaders: Infrastructure Solutions and Communications are best positioned given data center tailwinds and capacity expansions, while Residential expansion into HVAC/plumbing continues to broaden the addressable market .
  • Without formal Street comparisons, trading focus should center on backlog conversion, C&I project transitions, residential affordability signals, and capital allocation pace (buybacks/M&A) as catalysts for sentiment and revisions .

Estimates disclaimer: Values from S&P Global were unavailable due to request limits; comparisons vs consensus could not be performed at this time.