Comfort Systems USA Reports Third Quarter Results.Strong Increases in Profits, Backlog and Cash Flows Acquires Strong Service Company in the Northwest HOUSTON -- Comfort Systems USA, Inc. (NYSE NYSE See: New York Stock Exchange :FIX), a leading provider of commercial, industrial and institutional heating, ventilation and air conditioning air conditioning, mechanical process for controlling the humidity, temperature, cleanliness, and circulation of air in buildings and rooms. Indoor air is conditioned and regulated to maintain the temperature-humidity ratio that is most comfortable and healthful. ("HVAC (Heating Ventilation Air Conditioning) In the home or small office with a handful of computers, HVAC is more for human comfort than the machines. In large datacenters, a humidity-free room with a steady, cool temperature is essential for the trouble-free ") services, today announced net income of $11,478,000 or $0.28 per diluted share, for the quarter ended September 30, 2007, as compared to net income of $8,962,000 or $0.22 per diluted share, in the third quarter of 2006. Bill Murdy, Comfort Systems USA's Chairman and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. , said, "We are happy to report our strongest earnings in over five years. The vast majority of our locations performed superbly during the quarter, resulting in combined earnings increasing by more than 25% compared to a year ago. Operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. margins were strong and exceeded 6%." The Company reported revenues from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the of $286,090,000 in the current quarter, as compared to $287,676,000 in 2006. The Company also reported free cash flow of $14,109,000 in the current quarter, as compared to $3,265,000 in 2006. Backlog as of September 30, 2007 was $818,485,000, compared to $719,967,000 as of June 30, 2007. Backlog as of September 30, 2006 was $678,858,000. The Company reported net income for the nine months ended September 30, 2007 of $23,785,000 or $0.57 per diluted share, as compared to net income of $21,210,000 or $0.52 per diluted share in 2006. The Company also reported revenues from continuing operations of $816,250,000 for the first nine months of 2007, as compared to $788,451,000 in 2006. Free cash flow for the nine months ended September 30, 2007 was $17,911,000 as compared to negative free cash flow of $5,401,000 in 2006. Murdy continued, "Revenues have increased markedly during the first nine months of this year; however, revenues in the third quarter were down just slightly over the same quarter last year. This temporary flattening
The flattening, ellipticity, or oblateness of an oblate spheroid is the "squashing" of the spheroid's pole, down towards its equator. reflects the effect of our transition to a decreased emphasis on certain multi-family operations. Atlas, our large multi-family operation that is based in Houston, had revenues in this quarter that were lower by over $20 million as compared to a year ago. By contrast, revenues in our other companies grew strongly during the third quarter. Given our large increase in backlog and our strong cash performance, we feel confident that, like the temporary decrease in total backlog we experienced a year ago, this temporary flattening of total revenue will be followed by renewed growth." Separately, Comfort Systems USA today USA Today National U.S. daily general-interest newspaper, the first of its kind. Launched in 1982 by Allen Neuharth, head of the Gannett newspaper chain, it reached a circulation of one million within a year and surpassed two million in the 1990s. announced that it has acquired Air Systems Engineering, Inc. ("ASEI ASEI American Society of Engineers of Indian Origin ASEI Australian Student Environment Network ASEI Application Service Element Invocation "), a service-oriented commercial HVAC company based in Tacoma, Washington. ASEI had 2006 revenues of approximately $12 million, and if ASEI had been part of Comfort Systems in 2006 we believe it would have contributed earnings before interest, taxes, depreciation and amortization Earnings before interest, taxes, depreciation and amortization (EBITDA) is a non-GAAP metric that can be used to evaluate a company's profitability.
Bill Murdy noted, "We are very pleased to bring Air Systems Engineering into the Comfort Systems USA family of companies. ASEI has an outstanding reputation for service excellence in the Tacoma and Seattle area, and with a strong technical workforce and team-based culture we expect ASEI to continue to grow and excel." Bill Murdy concluded, "We are continuing to seek incremental Additional or increased growth, bulk, quantity, number, or value; enlarged. Incremental cost is additional or increased cost of an item or service apart from its actual cost. growth through prudent acquisitions, and we are optimistic op·ti·mist n. 1. One who usually expects a favorable outcome. 2. A believer in philosophical optimism. op about our prospects in that area. Overall, demand for our services remains solid and our growing and well-priced backlog helps us to remain confident that we will continue to demonstrate strong results as we finish 2007 and look forward to 2008." As previously announced, the Company will host a conference call to discuss its financial results and position in more depth on Thursday, November 1, 2007 at 10:00 a.m. Central Time. The call-in number for this conference call is 1-888-396-2298 and enter 64596935 as the passcode. The call can also be accessed on the Company's website at www.comfortsystemsusa.com under the Investor tab. A replay of the entire call will be available until 6:00 p.m. Central Time, Thursday, November 8, 2007 by calling 1-888-286-8010 with the conference passcode of 19062252, and will also be available on our website on the next business day following the call. Comfort Systems USA([R]) is a premier provider of business solutions addressing workplace comfort, with 62 locations in 54 cities around the nation. For more information, visit the Company's website at www.comfortsystemsusa.com. This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. These statements are based on the current plans and expectations of Comfort Systems USA, Inc. and involve risks and uncertainties that could cause actual future activities and results of operations to be materially different from those set forth in the forward-looking statements. Important factors that could cause actual results to differ include, among others, national or regional weakness in non-residential construction activity, difficulty in obtaining or increased costs associated with bonding, shortages of labor and specialty building materials Building materials used in the construction industry to create . These categories of materials and products are used by and construction project managers to specify the materials and methods used for . , the use of incorrect estimates for bidding a fixed price contract, undertaking contractual commitments that exceed our labor resources, retention of key management, the Company's backlog failing to translate into actual revenue or profits, errors in the Company's percentage of completion method of accounting, the result of competition in the Company's markets, seasonal fluctuations in the demand for HVAC systems, the imposition of past and future liability from environmental, safety, and health regulations including the inherent risk associated with self-insurance, adverse litigation An action brought in court to enforce a particular right. The act or process of bringing a lawsuit in and of itself; a judicial contest; any dispute. When a person begins a civil lawsuit, the person enters into a process called litigation. results and other risks detailed in the Company's reports filed with the Securities and Exchange Commission. Important factors that could cause actual results to differ are discussed under "Item 1A. Company Risk Factors" in the Company's Annual Report on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. for the year ended December 31, 2006. These forward-looking statements speak only as of the date of this release. Comfort Systems USA, Inc. expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in Comfort Systems USA, Inc.'s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Financial tables follow [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] [TABLE OMITTED] |
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