Dycom Industries Inc. (NYSE:DY) Q2 2018 Earnings Conference Call Transcript
Feb 28, 2018 • 08:00 am ET
Ladies and gentlemen, thank you for standing by. Welcome to the Dycom Results Conference Call. At this time, all participants are in a listen-only mode. Later we will conduct a question-and-answer session instructions will be given at that time. (Operator Instructions) As a reminder, this conference is being recorded.
I would now like to turn the conference over to your host, Steve Nielsen. Please go ahead.
Steven E. Nielsen
Thank you, Greg. Good morning, everyone. I'd like to thank you for attending this conference call to review our second quarter fiscal 2018 results. Before we begin, going to Slide 3. During this call, we will be referring to a slide presentation which can be found on our website's Investor Relations main page. Relevant slides will be identified by number throughout our presentation. Today, we have on the call, Drew DeFerrari, our Chief Financial Officer; and Rick Vilsoet, our General Counsel.
Now I will turn the call over to Rick Vilsoet.
Richard B. Vilsoet
Thank you, Steve. Except for historical information, the statements made by the company management during this call maybe forward-looking and are maybe pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements, including those related to the company's outlook are based on management's current expectations, estimates and projections and involve known and unknown risks and uncertainties, which may cause the company's actual results in future periods to differ materially from forecasted results. Those risks and uncertainties are more fully described in the company's annual report on Form 10-K for the year ended July 29, 2017, and other periodic filings with the Securities and Exchange Commission. The company assumes no obligation to update forward-looking statements. Steve?
Steven E. Nielsen
Thanks, Rick. Now moving to Slide 4, and a review of our second quarter results. As you review our results, please note that we have presented in our release and comments certain revenue amounts excluding revenues from storm restoration services during the quarter and from a business acquired during the third quarter of fiscal 2017. Adjusted EBITDA, adjusted net income and adjusted diluted earnings per share, all of which are non-GAAP financial measures. See Slides 13 through 21 for a reconciliation of our non-GAAP measures to GAAP measures.
Revenue was $655.1 million, a decrease of 6.6%. Organic revenue, excluding $19.6 million of storm restoration services in the quarter declined 10.6%. This quarter reflected an increase in demand from two key customers as we deployed 1-gigabit wireline networks, wireless/wireline converged networks and grew core market share, offset by the expected moderation from a large customer, revenue declined from certain other customers. Gross margin were 17.48% of revenue, reflecting difficult winter weather conditions and cost associated with the initiation of large customer programs. General and administrative expenses were 9.21%. All of these factors produced adjusted EBITDA of $59.6 million, or 9.1% of revenue and adjusted diluted earnings per share of $0.12 compared to $0.82 from the year ago quarter. Operating cash flow was strong, totaling $103.7 million in the quarter. Liquidity was ample