On July 25, 2024, Comfort Systems USA Inc (FIX, Financial) released its 8-K filing reporting impressive results for the second quarter of 2024. Comfort Systems USA Inc provides comprehensive mechanical contracting services, including heating, ventilation, and air conditioning (HVAC); plumbing; piping and controls; construction; and other electrical components. The company operates in two segments: Mechanical services and Electrical services, with the majority of revenue coming from the Mechanical services segment.
Q2 2024 Financial Highlights
Comfort Systems USA Inc reported net income of $134.0 million, or $3.74 per diluted share, for the quarter ended June 30, 2024. This represents a significant increase from $69.5 million, or $1.93 per diluted share, for the same period in 2023. Revenue for the second quarter of 2024 was $1.81 billion, up from $1.30 billion in the previous year. These results surpassed analyst estimates of $3.14 earnings per share and $1.69 billion in revenue.
Operational Performance and Challenges
The company’s operating cash flow also saw a notable increase, reaching $189.9 million in Q2 2024 compared to $125.4 million in Q2 2023. Brian Lane, Comfort Systems USA’s President and CEO, commented, “Our teams achieved superb execution for our customers this quarter, and early results from recently acquired companies also exceeded our high expectations. Second quarter per share earnings were more than 90% higher than the same quarter last year, and cash flow was remarkable for a second quarter.”
“Backlog also remains at extremely high levels despite a roughly 30% surge in same-store revenue. Same-store backlog is 25% above last year, demand continues at unprecedented levels and our job pipelines are robust. Considering these factors, we remain optimistic that our strong results will continue in the second half of 2024 and into 2025.”
Financial Achievements and Industry Impact
Comfort Systems USA Inc’s backlog as of June 30, 2024, was $5.77 billion, compared to $5.91 billion as of March 31, 2024, and $4.19 billion as of June 30, 2023. On a same-store basis, backlog increased from $4.19 billion to $5.22 billion year-over-year. This substantial backlog indicates sustained demand and a strong pipeline of projects, which is crucial for the company’s future revenue and profitability.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Revenue | $1.81 billion | $1.30 billion |
| Net Income | $134.0 million | $69.5 million |
| Operating Cash Flow | $189.9 million | $125.4 million |
| Backlog | $5.77 billion | $4.19 billion |
Income Statement and Balance Sheet Insights
For the six months ended June 30, 2024, Comfort Systems USA Inc reported net income of $230.3 million, or $6.43 per diluted share, compared to $126.7 million, or $3.53 per diluted share, in 2023. Revenue for the first half of 2024 was $3.35 billion, up from $2.47 billion in the same period last year. Operating cash flow for the six months ended June 30, 2024, was $336.4 million, compared to $252.3 million in 2023.
The company’s balance sheet remains strong with total assets of $4.21 billion as of June 30, 2024, compared to $3.31 billion as of December 31, 2023. Total liabilities were $2.73 billion, and total stockholders' equity was $1.48 billion as of June 30, 2024.
Analysis and Conclusion
Comfort Systems USA Inc’s robust financial performance in Q2 2024, driven by high demand and successful acquisitions, positions the company well for continued growth. The significant increase in revenue, net income, and operating cash flow, along with a strong backlog, underscores the company’s ability to capitalize on market opportunities. Value investors and potential GuruFocus.com members should consider these positive trends when evaluating Comfort Systems USA Inc as a potential investment.
Explore the complete 8-K earnings release (here) from Comfort Systems USA Inc for further details.
