EX-99.1 2 d794617dex991.htm EX-99.1 EX-99.1

Exhibit 99.1

 

LOGO

Bowman Announces Financial Results for Three Months Ended March 31, 2024

Reston, Va., May 6, 2024 (BUSINESS WIRE) – Bowman Consulting Group Ltd. (Nasdaq: BWMN) (“Bowman” or the “Company”), a national engineering and infrastructure services firm supporting owners and developers of the built environment, today released financial results for the three months ended March 31, 2024.

“The first quarter delivered the revenue rebound we were expecting,” said Gary Bowman, Chairman and CEO of Bowman. “Net service billing increased consecutively each month during the quarter in line with our expectations. Demand for engineering services remains strong and we generated healthy new orders during the quarter, especially in transportation which showed a meaningful increase as a percentage of total backlog. With the bulk of our organic growth anticipated to occur during the balance of 2024, we are confident we have sufficient revenue in backlog and a right-sized organizational infrastructure to deliver expanding margins as we realize the increasing benefits of scale throughout the year. We are pleased to increase our net service billing and adjusted EBITDA guidance once again for 2024.”

“In early April we closed on an equity offering that included approximately $51 million of gross proceeds to the company,” continued Bowman. “Then, last week we closed on a new $100 million revolving credit facility with Bank of America and TD Bank and separately on an $11 million cash-out refinancing of recently acquired Surdex aviation assets. As a result of these efforts, we believe we are sufficiently capitalized to continue to grow and execute on our current high-frequency acquisition strategy.”

Financial Highlights for the Three Months Ended March 31, 2024, Compared to March 31, 2023:

 

  •  

Gross contract revenue of $94.9 million, compared to $76.1 million, a 25% increase

 

  •  

Year-over-year organic gross contract revenue growth1 of 1%

 

  •  

Net service billing2 of $85.7 million, compared to $67.6 million, a 27% increase

 

  •  

Year-over-year organic net service billing growth of 3%

 

  •  

Net loss of $1.6 million3, compared to net income of $0.5 million

 

  •  

Adjusted EBITDA2 of $12.1 million, compared to $9.7 million, a 25% increase

 

  •  

Adjusted EBITDA margin, net 2 of 14.2% compared to 14.3%, a 10 bps decrease

 

  •  

Gross backlog2 of $330 million, compared to $252 million, a 31% increase

Subsequent Events of Note:

 

  •  

On April 1, 2024, the Company closed on a $51 million equity offering

 

  •  

On April 4, 2024, the Company closed on the acquisition of Surdex Corporation

 

  •  

On April 17, 2024, the Company closed on the acquisition of Moore Consulting Engineers

 

  •  

On May 2, 2024, the Company closed on a new $100 million accordion-style syndicated revolving credit facility with Bank of America, N.A. and TD Bank, N.A., replacing the Company’s $70 million facility with Bank of America

 

  •  

On May 3, 2024, the Company closed on a new $11 million cash-out refinancing of its Surdex aviation assets

Non-GAAP Adjusted Earnings per Share:

In connection with the release of financial results the Company reported the non-GAAP financial metric of adjusted earnings per share (“Adjusted EPS”) as follows:

For the three months ended March 31, 2024, compared to March 31, 2023:

 

  •  

Basic Adjusted EPS was $0.22 compared to $0.28

 

  •  

Diluted Adjusted EPS was $0.20 compared to $0.26

To calculate Adjusted EPS, the Company adds back non-reoccurring expenses specific to acquisitions, non-cash stock compensation expense associated with pre-IPO grants, and other expenses not in the ordinary course of business. With respect to the elimination of any non-cash stock compensation expense, the Company computes an adjusted tax expense or benefit which accounts for the elimination of any periodic windfall or shortfall tax effects resulting from the difference between grant date fair value and vest date value. With respect to all other eliminations, the Company applies its average marginal statutory tax rate, currently 25.6%, to derive the tax adjustment associated with the elimination of these expenses. A reconciliation of non-GAAP Adjusted EPS to GAAP EPS, both basic and diluted, is included with this press release for reference.

Updating FY 2024 Guidance

The Company is adjusting its full year 2024 outlook for net service billing2 to be in the range of $382 to $397 million and Adjusted EBITDA2 in the range of $63 to $69 million. The current outlook for 2024 is based on completed acquisitions as of the date of this release and does not include contributions from any future acquisitions. Management discusses the Company’s acquisition pipeline and its prospective impact during regularly scheduled earnings calls.

Q1 2024 Earnings Webcast

 

Bowman will host an earnings webcast to discuss the results of the quarter as follows:
Date:   May 7, 2024
Time:   9:00 a.m. Eastern Time
Hosts:   Gary Bowman, Chairman and CEO and Bruce Labovitz, Chief Financial Officer
Where:   http://investors.bowman.com

 

1

To the extent applicable, includes reclassification of acquisitions closed in same period of the prior year to organic revenue in the prior period.

2

Non-GAAP financial metrics the Company believes offer valuable perspective on results of operations. See Non-GAAP tables below for reconciliations.

3

Includes an additional $1.3 million accrual for penalties and interest (P&I) in connection with the Company’s Section 174-related uncertain tax provision (UTP). Accruals for P&I are subject to reversal prior to payment if the Company elects to unwinds its UTP.

About Bowman Consulting Group Ltd.

Headquartered in Reston, Virginia, Bowman is a national engineering services firm delivering infrastructure solutions to customers who own, develop, and maintain the built environment. With over 2,200 employees and more than 90 offices throughout the United States, Bowman provides a variety of planning, engineering, geospatial, construction management, commissioning, environmental consulting, land procurement and other technical services to customers operating in a diverse set of regulated end markets. Bowman trades on the Nasdaq under the symbol BWMN. For more information, visit bowman.com or investors.bowman.com.

Investor Relations Contacts:

 

Bruce Labovitz   Betsy Patterson
ir@bowman.com   ir@bowman.com
(703) 464-1029   (310) 622-8227

Forward-Looking Statements

This press release may contain “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. All statements contained in this press release other than statements of historical fact, including statements regarding our future results of operations and financial position, business strategy and plans and objectives for future operations, are forward-looking statements and represent our views as of the date of this press release. The words “anticipate”, “believe”, “continue”, “estimate”, “expect”, “intend”, “may”, “will”, “goal” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs, These forward-looking statements are subject to several assumptions and risks and uncertainties, many of which involve factors or circumstances that are beyond our control that could affect our financial results. The Company cautions that these statements are qualified by important factors that could cause actual results to differ materially

from those reflected by the forward-looking statements contained in this news release. Such factors include: (a) changes in demand from the local and state government and private clients that we serve; (b) general economic conditions, nationally and globally, and their effect on the market for our services; (c) competitive pressures and trends in our industry and our ability to successfully compete with our competitors; (d) changes in laws, regulations, or policies; and (e) the “Risk Factors” set forth in the Company’s most recent SEC filings. Considering these risks, uncertainties and assumptions, the future events and trends discussed in this press release may not occur and actual results could differ materially and adversely from those anticipates or implied in any forward-looking statements. Except as required by law, we are under no obligation to update these forward-looking statements after the date of this press release, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.

Non-GAAP Financial Measures and Other Key Metrics

We supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, with certain non-GAAP financial measures, as described below, to help represent, explain, and understand our operating performance. These non-GAAP financial measures may be different than similarly referenced measures used by other companies. The non-GAAP measures are intended to enhance investors’ overall understanding and evaluation of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. We present these non-GAAP financial measures to assist investors in seeing our financial performance in a manner more aligned with management’s view and believe these measures provide additional tools by which investors can evaluate our core financial performance over multiple periods relative to other companies in our industry. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the financial tables accompanying this press release.

BOWMAN CONSULTING GROUP LTD.

CONDENSED CONSOLIDATED BALANCE SHEETS

(Amounts in thousands except per share data)

 

     March 31,
2024		     December 31,
2023		  
     (Unaudited)  

ASSETS

     

Current Assets

     

Cash and equivalents

    $ 11,673     $ 20,687  

Accounts receivable, net

      95,975       87,565  

Contract assets

      36,673       33,520  

Notes receivable - officers, employees, affiliates, current portion

      1,181       1,199  

Prepaid and other current assets

      17,365       11,806  
  

 

 

    

 

 

  

Total current assets

      162,867       154,777  

Non-Current Assets

     

Property and equipment, net

      28,122       27,601  

Operating lease, right-of-use assets

      40,236       40,743  

Goodwill

      102,538       96,393  

Notes receivable

      903       903  

Notes receivable - officers, employees, affiliates, less current portion

      1,116       1,119  

Other intangible assets, net

      45,525       46,294  

Deferred tax asset, net

      37,981       33,780  

Other assets

      1,250       1,175  
  

 

 

    

 

 

  

Total Assets

    $ 420,538     $ 402,785  
  

 

 

    

 

 

  

LIABILITIES AND EQUITY

     

Current Liabilities

     

Revolving credit facility

      47,254       45,290  

Accounts payable and accrued liabilities, current portion

      49,015       44,394  

Contract liabilities

      7,955       7,481  

Notes payable, current portion

      13,672       13,989  

Operating lease obligation, less current portion

      9,567       9,016  

Finance lease obligation, current portion

      7,271       6,586  
  

 

 

    

 

 

  

Total current liabilities

      134,734       126,756  

Non-Current Liabilities

     

Other non-current obligations

      50,095       42,288  

Notes payable, less current portion

      12,177       13,738  

Operating lease obligation, less current portion

      36,659       37,660  

Finance lease obligation, less current portion

      14,987       14,408  

Pension and post-retirement obligation, less current portion

      4,630       4,654  
  

 

 

    

 

 

  

Total liabilities

    $ 253,282     $ 239,504  
  

 

 

    

 

 

  

Shareholders’ Equity

     

Preferred Stock, $0.01 par value; 5,000,000 shares authorized, no shares issued and outstanding as of March 31, 2024 and December 31, 2023

      —        —   

Common stock, $0.01 par value; 30,000,000 shares authorized as of March 31, 2024 and December 31, 2023; 18,191,818 shares issued and 15,428,519 outstanding, and 17,694,495 shares issued and 15,094,278 outstanding as of March 31, 2024 and December 31, 2023, respectively

      182       177  

Additional paid-in-capital

      226,681       215,420  

Accumulated other comprehensive income

      579       590  

Treasury stock, at cost; 2,763,299 and 2,600,217, respectively

      (32,142 )      (26,410 ) 

Stock subscription notes receivable

      (66 )      (76 ) 

Accumulated deficit

      (27,978 )      (26,420 ) 
  

 

 

    

 

 

  

Total shareholders’ equity

    $ 167,256     $ 163,281  
  

 

 

    

 

 

  

TOTAL LIABILITIES AND EQUITY

    $ 420,538     $ 402,785  
  

 

 

    

 

 

  

BOWMAN CONSULTING GROUP LTD.

CONDENSED CONSOLIDATED INCOME STATEMENTS

(Amounts in thousands except per share data)

(Unaudited)

 

     For the Three Months
Ended March 31,		  
     2024     2023  

Gross Contract Revenue

    $ 94,907     $ 76,100  

Contract costs: (exclusive of depreciation and amortization below)

     

Direct payroll costs

      37,687       28,835  

Sub-consultants and expenses

      9,218       8,538  
  

 

 

    

 

 

  

Total contract costs

      46,905       37,373  
  

 

 

    

 

 

  

Operating Expenses:

     

Selling, general and administrative

      44,713       33,636  

Depreciation and amortization

      5,995       3,565  

Gain on sale

      (96 )      (11 ) 
  

 

 

    

 

 

  

Total operating expenses

      50,612       37,190  
  

 

 

    

 

 

  

(Loss) Income from operations

      (2,610 )      1,537  
  

 

 

    

 

 

  

Other expense

      2,401       1,213  
  

 

 

    

 

 

  

(Loss) Income before tax expense

      (5,011 )      324  

Income tax (benefit)

      (3,453 )      (213 ) 
  

 

 

    

 

 

  

Net (loss) income

    $ (1,558 )    $ 537  
  

 

 

    

 

 

  

Earnings allocated to non-vested shares

      —        69  
  

 

 

    

 

 

  

Net (loss) income attributable to common shareholders

    $ (1,558 )    $ 468  
  

 

 

    

 

 

  

(Loss) Earnings per share

     

Basic

    $ (0.11 )    $ 0.04  

Diluted

    $ (0.11 )    $ 0.04  

Weighted average shares outstanding:

     

Basic

      13,827,728       11,800,308  

Diluted

      13,827,728       12,669,581  

BOWMAN CONSULTING GROUP LTD.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

 

     For the Three Months Ended March 31,  
      2024       2023   

Cash Flows from Operating Activities:

     

Net (Loss) Income

    $ (1,558 )    $ 537  

Adjustments to reconcile net income to net cash provided by operating activities

     

Depreciation and amortization—property, plant and equipment

      2,656       2,196  

Amortization of intangible assets

      3,339       1,369  

Gain on sale of assets

      (96 )      (11 ) 

Credit losses

      402       222  

Stock based compensation

      7,829       4,363  

Accretion of discounts on notes payable

      117       140  

Deferred taxes

      (4,201 )      (3,669 ) 

Changes in operating assets and liabilities

     

Accounts receivable

      (7,946 )      (2,943 ) 

Contract assets

      (2,151 )      (3,610 ) 

Prepaid expenses and other assets

      (5,523 )      (533 ) 

Accounts payable and accrued expenses

      10,614       7,748  

Contract liabilities

      (963 )      469  
  

 

 

    

 

 

  

Net cash provided by operating activities

      2,519       6,278  

Cash Flows from Investing Activities:

     

Purchases of property and equipment

      (262 )      (536 ) 

Fixed assets converted to lease financing

      424       —   

Proceeds from sale of assets and disposal of leases

      96       11  

Payments received under loans to shareholders

      20       105  

Acquisitions of businesses, net of cash acquired

      (3,027 )      —   

Collections under stock subscription notes receivable

      10       22  
  

 

 

    

 

 

  

Net cash used in investing activities

      (2,739 )      (398 ) 
  

 

 

    

 

 

  

Cash Flows from Financing Activities:

     

Borrowings under revolving credit facility

      1,964       —   

Repayments under fixed line of credit

      (49 )      (185 ) 

Repayment under notes payable

      (3,734 )      (2,685 ) 

Payments on finance leases

      (1,716 )      (1,687 ) 

Payments for purchase of treasury stock

      (5,732 )      (667 ) 

Proceeds from issuance of common stock

      473       390  
  

 

 

    

 

 

  

Net cash used in financing activities

      (8,794 )      (4,834 ) 
  

 

 

    

 

 

  

Net (decrease) increase in cash and cash equivalents

      (9,014 )      1,046  
  

 

 

    

 

 

  

Cash and cash equivalents, beginning of period

      20,687       13,282  
  

 

 

    

 

 

  

Cash and cash equivalents, end of period

    $ 11,673     $ 14,328  
  

 

 

    

 

 

  

Supplemental disclosures of cash flow information:

     

Cash paid for interest

    $ 1,962     $ 757  
  

 

 

    

 

 

  

Cash paid for income taxes

    $ 11     $ —   
  

 

 

    

 

 

  

Non-cash investing and financing activities

     

Property and equipment acquired under finance lease

    $ (3,002 )    $ (2,964 ) 
  

 

 

    

 

 

  

Note payable converted to common shares

    $ (672 )    $ —   
  

 

 

    

 

 

  

Issuance of notes payable for acquisitions

    $ (2,461 )    $ —   
  

 

 

    

 

 

  

BOWMAN CONSULTING GROUP LTD.

RECONCILIATION OF EPS TO ADJUSTED EPS

(Amounts in thousands except per share data)

 

     For the Three Months Ended
March 31,		  
     2024     2023  

Net (loss) income (GAAP)

    $ (1,558 )    $ 537  

+ tax (benefit) (GAAP)

      (3,453 )      (213 ) 
  

 

 

    

 

 

  

(Loss) Income before tax expense (GAAP)

    $ (5,011 )    $ 324  

+ acquisition related expenses

      1,350       849  

+ amortization of intangibles

      3,339       1,369  

+ non-cash stock comp related to pre-IPO

      1,557       1,722  

+ other non-core expenses

      399       —   
  

 

 

    

 

 

  

Adjusted income before tax expense

    $ 1,634     $ 4,264  

Adjusted income tax (benefit) expense

      (1,660 )      496  
  

 

 

    

 

 

  

Adjusted net income

    $ 3,294     $ 3,768  
  

 

 

    

 

 

  

Adjusted earnings allocated to non-vested shares

      310       488  
  

 

 

    

 

 

  

Adjusted net income attributable to common shareholders

    $ 2,984     $ 3,280  
  

 

 

    

 

 

  

(Loss) Earnings per share (GAAP)

     

Basic

    $ (0.11 )    $ 0.04  

Diluted

    $ (0.11 )    $ 0.04  

Adjusted earnings per share (Non-GAAP)

     

Basic

    $ 0.22     $ 0.28  

Diluted

    $ 0.20     $ 0.26  

Weighted average shares outstanding

     

Basic

      13,827,728       11,800,308  

Diluted

      14,561,032       12,669,581  
Basic Adjusted Earnings Per Share Summary - Non-GAAP    For the Three Months Ended
March 31,		  
     2024     2023  

(Loss) Earnings per share (GAAP)

    $ (0.11 )    $ 0.04  

Pre-tax basic per share adjustments

    $ 0.23     $ 0.32  
  

 

 

    

 

 

  

Adjusted earnings per share before tax expense

    $ 0.12     $ 0.36  

Tax (benefit) expense per share adjustment

    $ (0.12 )    $ 0.04  
  

 

 

    

 

 

  

Adjusted earnings per share - adjusted net income

    $ 0.24     $ 0.32  
  

 

 

    

 

 

  

Adjusted earnings per share allocated to non-vested shares

    $ 0.02     $ 0.04  
  

 

 

    

 

 

  

Adjusted earnings per share attributable to common shareholders

    $ 0.22     $ 0.28  
  

 

 

    

 

 

  
Diluted Adjusted Earnings Per Share Summary - Non-GAAP    For the Three Months Ended
March 31,		  
     2024     2023  

(Loss) Earnings per share (GAAP)

    $ (0.11 )    $ 0.04  

Pre-tax diluted per share adjustments

    $ 0.22     $ 0.30  
  

 

 

    

 

 

  

Adjusted earnings per share before tax expense

    $ 0.11     $ 0.34  

Tax (benefit) expense per share adjustment

    $ (0.11 )    $ 0.03  
  

 

 

    

 

 

  

Adjusted earnings per share - adjusted net income

    $ 0.22     $ 0.31  
  

 

 

    

 

 

  

Adjusted earnings per share allocated to non-vested shares

    $ 0.02     $ 0.05  
  

 

 

    

 

 

  

Adjusted earnings per share attributable to common shareholders

    $ 0.20     $ 0.26  
  

 

 

    

 

 

  

BOWMAN CONSULTING GROUP LTD.

RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES

(Amounts in thousands except per share data)

 

Combined Statement of Operations Reconciliation    For the Three Months Ended
March 31,		  
     2024     2023  

Gross contract revenue

    $ 94,907     $ 76,100  

Contract costs (exclusive of depreciation and amortization)

      46,905       37,373  

Operating expense

      50,612       37,190  
  

 

 

    

 

 

  

(Loss) Income from operations

      (2,610 )      1,537  

Other expense

      2,401       1,213  

Income tax (benefit)

      (3,453 )      (213 ) 
  

 

 

    

 

 

  

Net (loss) income

    $ (1,558 )    $ 537  
  

 

 

    

 

 

  

Net margin

      (1.6 )%      0.7 % 

Other financial information 1

     

Net service billing

    $ 85,689     $ 67,562  

Adjusted EBITDA

      12,128       9,673  

Adjusted EBITDA margin, net

      14.2 %      14.3 % 
Gross Contract Revenue to Net Service Billing Reconciliation    For the Three Months Ended
March 31,		  
     2024     2023  

Gross contract revenue

    $ 94,907     $ 76,100  

Less: sub-consultants and other direct expenses

      9,218       8,538  
  

 

 

    

 

 

  

Net service billing

    $ 85,689     $ 67,562  
Adjusted EBITDA Reconciliation    For the Three Months Ended
March 31,		  
     2024     2023  

Net Service Billing

    $ 85,689     $ 67,562  

Net (loss) income

    $ (1,558 )    $ 537  

+ interest expense

      2,131       896  

+ depreciation & amortization

      5,995       3,565  

+ tax (benefit)

      (3,453 )      (213 ) 
  

 

 

    

 

 

  

EBITDA

    $ 3,115     $ 4,785  

+ non-cash stock compensation

      7,861       4,434  

+ settlements and other non-core expenses

      399       —   

+ acquisition expenses

      753       454  
  

 

 

    

 

 

  

Adjusted EBITDA

    $ 12,128     $ 9,673  

Adjusted EBITDA margin, net

      14.2 %      14.3 % 

 

1

Non-GAAP financial metrics the Company believes offer valuable perspective on results of operations. See Non-GAAP tables below for reconciliations.

BOWMAN CONSULTING GROUP LTD.

GROSS CONTRACT REVENUE COMPOSITION

(Unaudited)

 

(dollars in thousands)    For the Three Months Ended March 31,  
Consolidated Gross Revenue    2024      %     2023      %     Change      %  

Building Infrastructure

      52,785        55.6 %      44,337        58.3 %      8,448        19.1 % 

Transportation

      18,128        19.1 %      16,019        21.0 %      2,109        13.2 % 

Power and Utilities

      18,467        19.5 %      13,324        17.5 %      5,143        38.6 % 

Other Emerging Markets1

      5,527        5.8 %      2,420        3.2 %      3,107        128.4 % 
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Total

      94,907        100.0 %      76,100        100.0 %      18,807        24.7 % 
(dollars in thousands)    For the Three Months Ended March 31,  
Organic v Acquired Revenue    2024      %     2023      %     Change      % Change  

Organic

      76,433        80.5 %      76,100        100.0 %      333        0.4 % 

Acquired2

      18,474        19.5 %      —         —  %      18,474        n/a  
  

 

 

     

 

 

    

 

 

     

 

 

    

 

 

     

 

 

  

Total

      94,907        100.0 %      76,100        100.0 %      18,807        24.7 % 

 

1

Represents environmental, mining, water resources and other.

2

After four quarters post-closing, acquired revenue is reclassified as organic; this results in a change from previously reported numbers.

BOWMAN CONSULTING GROUP LTD.

GROSS BACKLOG BY CATEGORY AT MARCH 31, 2024

(Unaudited)

 

Category

    Percentage  

Building Infrastructure

      51 % 

Transportation

      28 % 

Power and Utilities

      17 % 

Emerging Markets

      4 % 
  

 

 

  

TOTAL

      100 %