What changed in this filing

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Item 5. Market for Registrant’s Common Equity

2021-03-03 compared with 2020-03-04 · 62 added, 16 removed, 120 unchanged (39% of the section changed)

7 unchanged sentences

Issuances of Common Stock

On October 24, 2019, a total of 732 unregistered shares of our common stock, valued in the aggregate at $23,958 were issued to directors of the Company who elected to receive a portion of their director retainer fee in stock in lieu of cash.

On October 22, 2020, a total of 270 unregistered shares of our common stock, valued in the aggregate at $11,966 was issued to a director of the Company who elected to receive a portion of their director retainer fee in stock in lieu of cash.

The shares were issued pursuant to the exemption from registration provided by Section 4(a)(2) of the Securities Act of 1933 for an issuance not involving a public offering.

Purchases of Common Stock

We did not purchase any shares of common stock in October, November or December of 2019.

The following table includes all of the Company’s repurchases of common stock for the periods shown.

Repurchased shares are retired and returned to authorized but unissued common stock.

Period Total Number of Shares Purchased (1) Average Price Paid per Share Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Programs (2)

October 1, 2020 - October 31, 2020 2,597 $ 43.94 — $ 50,000,000

November 1, 2020 - November 30, 2020 2,172 $ 51.92 — $ 50,000,000

December 1, 2020 - December 31, 2020 — $ — — $ 50,000,000

Total 4,769 $ 47.57 —

(1) This column contains repurchases of common stock to satisfy tax obligations on the vesting of restricted stock under the 2007 Long-Term Incentive Plan (as amended).

(2) On October 22, 2020 the Company’s Board of Directors authorized a new $50.0 million share repurchase program effective November 2, 2020.

The Company intends to fund the share repurchase program from cash on hand and through borrowings under its credit facility.

The new share repurchase program will expire on November 2, 2021, or when the authorized funds are exhausted, whichever is earlier.

No shares were repurchased under the new program in 2020.

Performance Graph

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Tetra Tech, Inc.

___________________________

* Considered our core group of peers with a more significant portion of operations being similar to ours than the overall group.

Graph presents entire Peer Group.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

Among MYR Group, Inc., the S&P 500 Index, the Russell 2000 Index,

and a peer Group

*$100 invested on 12/31/2015 in stock or including reinvestment of dividends.

Fiscal year ending December 31.

12/31/2015 12/31/2016 12/31/2017 12/31/2018 12/31/2019 12/31/2020

MYR Group Inc.

TABLE OF CONTENTS

100.00 182.82 173.36 136.68 158.13 291.61

S&P 500 100.00 111.96 136.40 130.42 171.49 203.04

Russell 2000 100.00 121.31 139.08 123.76 155.35 186.36

Peer Group 100.00 149.36 173.81 131.61 175.60 227.17

Selected Financial Data

9 unchanged sentences

Contract revenues (1)

$ 2,247,392 $ 2,071,159 $ 1,531,169 $ 1,403,317 $ 1,142,487

Contract costs 1,971,539 1,857,001 1,364,109 1,278,313 1,007,764

Gross profit 275,853 214,158 167,060 125,004 134,723

Selling, general and administrative expenses 188,535 156,674 118,737 98,611 96,424

6 unchanged sentences

Other income (expense), net (606) (515) (3,616) (2,319) 885

Income before income tax expense

Income before provision for income taxes 81,385 50,442 43,068 24,640 38,345

Income tax expense (2)

22,626 14,228 11,774 3,486 16,914

Net income 58,759 36,214 31,294 21,154 21,431

net income (loss) attributable to noncontrolling interest — (1,476) 207 — —

Net income attributable to MYR Group Inc.

$ 58,759 $ 37,690 $ 31,087 $ 21,154 $ 21,431

Income per common share attributable to MYR Group Inc.:

– Basic $ 3.52 $ 2.27 $ 1.89 $ 1.30 $ 1.25

– Diluted $ 3.48 $ 2.26 $ 1.87 $ 1.28 $ 1.23

Weighted average number of common shares and potential common shares outstanding:

– Basic 16,684 16,587 16,441 16,273 17,109

– Diluted 16,890 16,699 16,585 16,496 17,461

Balance sheet data:

3 unchanged sentences

Working capital (3)

193,284 242,370 191,829 191,172 146,677

Total assets 995,859 1,007,871 748,755 603,788 573,495

Total debt 29,420 165,824 89,792 78,960 59,070

Total liabilities 566,567 643,396 424,291 316,749 310,321

Stockholders’ equity attributable to MYR Group Inc.

Total stockholders’ equity attributable to MYR Group Inc.

429,288 364,471 322,984 287,039 263,174

For the year ended December 31,

4 unchanged sentences

Depreciation and amortization (4)

46,453 44,516 39,913 38,576 39,122

Capital expenditures 44,355 57,828 50,704 30,843 25,371

1,649,456 1,499,203 1,146,637 679,139 688,832

132,392 101,179 86,609 65,815 78,761

___________________________

(1) On January 1, 2018, we adopted ASU No.

2014-09 , Revenue from Contracts with Customers (Topic 606) using the modified retrospective method for contracts that were not completed as of January 1, 2018.

Results for reporting periods beginning after January 1, 2018 are presented under this new pronouncement, while prior period amounts were not adjusted and continue to be reported under the accounting standard Revenue Recognition Topic 605 , which was in effect for those periods.

Differences in revenue recognition under Topic 606 were due to accelerated recognition of contract provisions related to variable consideration previously not permitted to be recognized under Topic 605 until no remaining contingency existed related to this consideration.

(2) The Tax Cuts and Jobs Act of 2017 (“2017 Tax Act”), among its many provisions, reduced the federal statutory tax rate from 35% to 21%.

4 unchanged sentences

The Company defines working capital as total current assets less total current liabilities.

Certain adjustments were made to working capital beginning in 2016 that are not reflected in the prior period.

The following table provides the Company’s calculation of working capital:

4 unchanged sentences

Working capital $ 193,284 $ 242,370 $ 191,829 $ 191,172 $ 146,677

Depreciation and amortization includes depreciation on capital assets, amortization of capital lease assets and amortization of finite-lived intangible assets.

(4) Depreciation and amortization includes depreciation on capital assets, amortization of finance lease assets and amortization of finite-lived intangible assets.

(5) Backlog represents our estimated revenue on uncompleted contracts, including the amount of revenue on contracts on which work has not begun, minus the revenue we have recognized under such contracts.

1 unchanged sentence

Risk Factors — Backlog may not be realized or may not result in profits and may not accurately represent future revenue.”

We define EBITDA, a performance measure used by management, as net income attributable to MYR Group Inc.

(6) EBITDA is a non-GAAP measure used by management that we define as net income attributable to MYR Group Inc.

plus net income from noncontrolling interests, interest expense net of interest income, income tax expense and depreciation and amortization, as shown in the following table.

EBITDA, a non-GAAP financial measure, does not purport to be an alternative to net income attributable to MYR Group Inc.

EBITDA does not purport to be an alternative to net income attributable to MYR Group Inc.

as a measure of operating performance or to net cash flows provided by operating activities as a measure of liquidity.

We believe that EBITDA is useful to investors and other external users of our Consolidated Financial Statements in evaluating our operating performance and cash flow because EBITDA is widely used by investors to measure a company’s operating performance without regard to items such as interest expense, taxes, depreciation and amortization, which can vary substantially from company to company depending upon accounting methods, book value of assets, useful lives placed on assets, capital structure and the method by which assets were acquired.

Because not all companies use identical calculations, this presentation of EBITDA may not be comparable to other similarly-titled measures of other companies.

Because not all companies define EBITDA as we do, this presentation of EBITDA may not be comparable to other similarly-titled measures of other companies.

We use, and we believe investors benefit from, the presentation of EBITDA in evaluating our operating performance because it provides us and our investors with an additional tool to compare our operating performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our core operations.

We believe that EBITDA is useful to investors and other external users of our Financial Statements in evaluating our operating performance and cash flow because EBITDA is widely used by investors to measure a company’s operating performance without regard to items such as interest expense, taxes, depreciation and amortization, which can vary substantially from company to company depending upon accounting methods and book value of assets, useful lives placed on assets, capital structure and the method by which assets were acquired.

Using EBITDA as a performance measure has material limitations as compared to net income, or other financial measures as defined under GAAP, as it excludes certain recurring items, which may be meaningful to investors.

12 unchanged sentences

Net income attributable to MYR Group Inc.

Net income – noncontrolling interests

$ 58,759 $ 37,690 $ 31,087 $ 21,154 $ 21,431

Net income (loss) - noncontrolling interests — (1,476) 207 — —

Net income 58,759 36,214 31,294 21,154 21,431

Interest expense, net 4,554 6,221 3,628 2,599 1,294

1 unchanged sentence

Depreciation and amortization 46,453 44,516 39,913 38,576 39,122

EBITDA $ 132,392 $ 101,179 $ 86,609 $ 65,815 $ 78,761

We also use EBITDA as a liquidity measure.

Certain material covenants contained within our credit agreement (the “Credit Agreement”) are based on EBITDA with certain additional adjustments as defined

in the Credit Agreement.

Certain material covenants contained within our credit agreement (the “Credit Agreement”) are based on EBITDA with certain additional adjustments as defined in the Credit Agreement.

Non-compliance with these financial covenants under the Credit Agreement — our interest coverage ratio which is defined in the Credit Agreement as Consolidated EBITDA (as defined in the Credit Agreement) divided by interest expense (as defined in the Credit Agreement) and our leverage ratio, which is defined in the Credit Agreement as Consolidated Total Indebtedness (as defined in the Credit Agreement), divided by Consolidated EBITDA (as defined in the Credit Agreement) — could result in our lenders requiring us to immediately repay all amounts borrowed.

5 unchanged sentences

(in thousands) 2020 2019 2018 2017 2016

Net cash flows provided by (used in) operating

Net cash flows provided by (used in) operating activities $ 175,167 $ 64,899 $ 84,789 $ (9,198) $ 54,490

Add/(subtract)

4 unchanged sentences

Interest expense, net 4,554 6,221 3,628 2,599 1,294

TABLE OF CONTENTS

EBITDA $ 132,392 $ 101,179 $ 86,609 $ 65,815 $ 78,761

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 5. Market for Registrant’s Common Equity