Business Wire | Jul 29, 2021 07:30AM EDT

EMCOR Group, Inc. Reports Second Quarter 2021 Results

Jul. 29, 2021

NORWALK, Conn.--(BUSINESS WIRE)--Jul. 29, 2021--EMCOR Group, Inc. (NYSE: EME) today reported results for the second quarter ended June 30, 2021.

For the second quarter of 2021, net income was $97.4 million, or $1.78 per diluted share, compared to a net loss of $83.7 million, or $(1.52) per diluted share, for the second quarter of 2020. The net loss for the second quarter of 2020 included after-tax goodwill, identifiable intangible asset, and other long-lived asset impairment charges, related to our U.S. Industrial Services segment. Excluding these impairment charges, non-GAAP net income for the second quarter of 2020 was $79.2 million, or $1.44 per diluted share. Revenues for the second quarter of 2021 totaled $2.44 billion, up 21.0% from the second quarter of 2020.

Operating income for the second quarter of 2021 was $133.4 million, or 5.5% of revenues, compared to an operating loss of $122.6 million, or (6.1)% of revenues, for the second quarter of 2020. Excluding pre-tax impairment charges of $232.8 million in the prior year period, non-GAAP operating income for the second quarter of 2020 was $110.1 million, or 5.5% of revenues.

Selling, general and administrative expenses for the second quarter of 2021 totaled $242.9 million, or 10.0% of revenues, compared to $205.2 million, or 10.2% of revenues, for the second quarter of 2020.

Please see the attached tables for a reconciliation of non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, and non-GAAP diluted earnings per share to the comparable GAAP measures.

The Company's income tax rate for the second quarter of 2021 was 26.8% compared to an income tax rate of (32.5)% for the second quarter of 2020.

Remaining performance obligations as of June 30, 2021 were $5.11 billion compared to $4.59 billion as of June 30, 2020. Total remaining performance obligations grew approximately $515.8 million year-over-year.

Tony Guzzi, Chairman, President, and Chief Executive Officer of EMCOR, commented, "The Company once again delivered exceptional performance, with record second quarter revenues, gross profit, operating income, net income, and diluted earnings per share, building upon an already strong start to the year. We achieved outstanding revenue growth of 21.0% year-over-year, 18.4% of which was organic, and our continued operational execution enabled us to deliver a healthy operating income margin of 5.5%. Despite the uncertain environment we have seen over the last year, our remaining performance obligations increased 11.2% year-over-year to a record $5.11 billion, demonstrating resilient demand for our services across our geographies and end markets."

Mr. Guzzi added, "Our U.S. Construction segments continue to perform exceptionally well, generating combined year-over-year revenue and operating income growth in the quarter of 20.6% and 23.7%, respectively, driven by broad-based growth across our trade offerings, end market sectors, and geographic footprint. Our U.S. Building Services segment was also a highlight during the quarter, with double-digit year-over-year revenue and operating income growth of 30.4% and 13.9%, respectively, led by HVAC retrofits, particularly energy efficiency and IAQ projects, coupled with the strong performance of our commercial site-based business. Our U.S. Industrial Services segment continues to face a difficult operating environment. However, we expect performance to improve as customer inquiries and scheduling have increased as we move into 2022. Finally, we are pleased by the sustained strength in our U.K. Building Services segment, which delivered year-over-year revenue and operating income growth of 39.5% and 31.7%, respectively, during the quarter, driven by continued execution for our customers, and partially aided by favorable foreign exchange rate movement."

Revenues for the first six months of 2021 totaled $4.74 billion, an increase of 9.9%, compared to $4.31 billion for the first six months of 2020. Net income for the first six months of 2021 was $182.1 million, or $3.32 per diluted share, compared to a net loss of $8.0 million, or $(0.14) per diluted share, for the first six months of 2020. Excluding the after-tax impact of the previously referenced impairment charges in the prior year, non-GAAP net income for the first six months of 2020 was $154.9 million, or $2.78 per diluted share.

Operating income for the first six months of 2021 was $250.4 million, representing an operating margin of 5.3%, compared to an operating loss of $16.6 million, representing an operating margin of (0.4)%, for the first six months of 2020. Excluding the prior year impairment charges, non-GAAP operating income for the first six months of 2020 was $216.1 million, representing a non-GAAP operating margin of 5.0%.

Selling, general and administrative expenses totaled $467.0 million, or 9.8% of revenues, for the first six months of 2021, compared to $432.2 million, or 10.0% of revenues, for the first six months of 2020.

Please see the attached tables for a reconciliation of non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, and non-GAAP diluted earnings per share to the comparable GAAP measures.

Based on year-to-date performance and assuming a gradual improvement of current market conditions as the year progresses, EMCOR is raising its full-year 2021 revenue guidance to approximately $9.5 billion, an increase from the prior guidance range of $9.2 billion to $9.4 billion. The Company now also expects full-year 2021 diluted earnings per share in the range of $6.65 to $7.05, an increase from the prior guidance range of $6.35 to $6.75.

Mr. Guzzi concluded, "Our strong first half results, robust remaining performance obligations, and improved visibility are encouraging and, as a result, we are raising our full year 2021 guidance for revenue and diluted earnings per share. As always, we continue to focus on the elements of our business that we can control, protecting the health and safety of our employees, and adjusting our operations as necessary in a disciplined manner aligned with our customer commitments and opportunities. Moving forward, we will continue to execute on our balanced capital allocation strategy, utilizing our healthy balance sheet to invest in organic growth, pursue strategic acquisition opportunities, and maintain our commitment to returning capital to shareholders through share repurchases and dividends."

EMCOR Group, Inc. is a Fortune 500 leader in mechanical and electrical construction services, industrial and energy infrastructure and building services. This press release and other press releases may be viewed at the Company's website at www.emcorgroup.com. EMCOR routinely posts information that may be important to investors in the "Investor Relations" section of our website at www.emcorgroup.com. Investors and potential investors are encouraged to consult the EMCOR website regularly for important information about EMCOR.

EMCOR Group's second quarter conference call will be available live via internet broadcast today, Thursday, July 29, at 10:30 AM Eastern Daylight Time. The live call may be accessed through the Company's website at www.emcorgroup.com.

Forward Looking Statements:

This release contains certain forward-looking statements. Any such comments speak only as of July 29, 2021 and EMCOR assumes no obligation to update any such forward-looking statements, unless required by law. These forward-looking statements may include statements regarding anticipated future operating and financial performance, the nature and impact of our remaining performance obligations, our ability to pursue acquisitions, our ability to return capital to shareholders, market opportunities, market growth, and customer trends. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those anticipated (whether expressly or implied) by the forward-looking statements. Accordingly, these statements are no guarantee of future performance or events. Such risks and uncertainties include, but are not limited to, adverse effects of general economic conditions, changes in the political environment, changes in the specific markets for EMCOR's services, adverse business conditions, availability of adequate levels of surety bonding, increased competition, unfavorable labor productivity, mix of business, and the impact of the COVID-19 pandemic on our revenue and operations, including employees, construction activity, and facilities utilization. Certain of the risk factors associated with EMCOR's business are also discussed in Part I, Item 1A "Risk Factors," of the Company's 2020 Form 10-K, and in other reports filed from time to time with the Securities and Exchange Commission and available at www.sec.gov and www.emcorgroup.com. Such risk factors should be taken into account in evaluating any forward-looking statements.

Non-GAAP Measures:

This release also includes certain financial measures, including non-GAAP operating income, non-GAAP operating margin, non-GAAP net income, and non-GAAP diluted EPS, that were not prepared in accordance with U.S. generally accepted accounting principles (GAAP). Reconciliations of those non-GAAP financial measures to the most directly comparable GAAP financial measures are included in this release. The Company uses these non-GAAP measures as key performance indicators for the purpose of evaluating performance internally. We also believe that these non-GAAP measures provide investors with useful information with respect to our ongoing operations. Any non-GAAP financial measures presented are not, and should not be viewed as, substitutes for financial measures required by GAAP, have no standardized meaning prescribed by GAAP, and may not be comparable to the calculation of similar measures of other companies.

EMCOR GROUP, INC.

FINANCIAL HIGHLIGHTS



CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except share and per share information)

(Unaudited)

For the three months ended For the six months ended June 30, June 30,

2021 2020 2021 2020

Revenues $ 2,437,666 $ 2,014,021 $ 4,741,715 $ 4,313,853

Cost of sales 2,061,387 1,698,735 4,024,363 3,665,506

Gross profit 376,279 315,286 717,352 648,347

Selling,general and 242,921 205,174 466,990 432,171 administrativeexpenses

Restructuring - - - 69 expenses

Impairment losson goodwill,identifiableintangible - 232,750 - 232,750 assets, andotherlong-livedassets

Operating 133,358 (122,638) 250,362 (16,643) income (loss)

Net periodicpension (cost) 922 718 1,830 1,460 income

Interest (1,316) (2,110) (2,679) (4,598) expense, net

Income (loss)before income 132,964 (124,030) 249,513 (19,781) taxes

Income taxprovision 35,616 (40,341) 67,220 (11,757) (benefit)

Net income(loss)including 97,348 (83,689) 182,293 (8,024) noncontrollinginterests

Net (loss)incomeattributable to (2) - 169 - noncontrollinginterests

Net income(loss)attributable to $ 97,350 $ (83,689) $ 182,124 $ (8,024) EMCOR Group,Inc.



Basic earnings(loss) per $ 1.79 $ (1.52) $ 3.34 $ (0.14) common share



Dilutedearnings (loss) $ 1.78 $ (1.52) $ 3.32 $ (0.14) per commonshare



Weightedaverage shares of common stockoutstanding:

Basic 54,301,466 54,937,038 54,594,208 55,467,799

Diluted 54,587,813 54,937,038 54,856,759 55,467,799



Dividendsdeclared per $ 0.13 $ 0.08 $ 0.26 $ 0.16 common share



EMCOR GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

June 30, 2021 (Unaudited)

December 31, 2020

ASSETS

Current assets:

Cash and cash equivalents

$

668,908

$

902,867

Accounts receivable, net

2,102,735

1,922,096

Contract assets

203,353

171,956

Inventories

64,713

53,338

Prepaid expenses and other

73,645

70,679

Total current assets

3,113,354

3,120,936

Property, plant and equipment, net

155,565

158,427

Operating lease right-of-use assets

250,405

242,155

Goodwill

868,819

851,783

Identifiable intangible assets, net

587,247

582,893

Other assets

157,780

107,646

Total assets

$

5,133,170

$

5,063,840

LIABILITIES AND EQUITY

Current liabilities:

Current maturities of long-term debt and finance lease liabilities

$

16,589

$

16,910

Accounts payable

635,803

671,886

Contract liabilities

769,959

722,252

Accrued payroll and benefits

421,767

450,955

Other accrued expenses and liabilities

243,270

247,597

Operating lease liabilities, current

55,722

53,632

Total current liabilities

2,143,110

2,163,232

Long-term debt and finance lease liabilities

259,653

259,619

Operating lease liabilities, long-term

211,483

205,362

Other long-term obligations

427,747

382,383

Total liabilities

3,041,993

3,010,596

Equity:

Total EMCOR Group, Inc. stockholders' equity

2,090,475

2,052,668

Noncontrolling interests

702

576

Total equity

2,091,177

2,053,244

Total liabilities and equity

$

5,133,170

$

5,063,840

EMCOR GROUP, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands)

June 30, 2021 December 31, (Unaudited) 2020

ASSETS

Current assets:

Cash and cash equivalents $ 668,908 $ 902,867

Accounts receivable, net 2,102,735 1,922,096

Contract assets 203,353 171,956

Inventories 64,713 53,338

Prepaid expenses and other 73,645 70,679

Total current assets 3,113,354 3,120,936

Property, plant and equipment, net 155,565 158,427

Operating lease right-of-use assets 250,405 242,155

Goodwill 868,819 851,783

Identifiable intangible assets, net 587,247 582,893

Other assets 157,780 107,646

Total assets $ 5,133,170 $ 5,063,840

LIABILITIES AND EQUITY

Current liabilities:

Current maturities of long-term debt and finance $ 16,589 $ 16,910 lease liabilities

Accounts payable 635,803 671,886

Contract liabilities 769,959 722,252

Accrued payroll and benefits 421,767 450,955

Other accrued expenses and liabilities 243,270 247,597

Operating lease liabilities, current 55,722 53,632

Total current liabilities 2,143,110 2,163,232

Long-term debt and finance lease liabilities 259,653 259,619

Operating lease liabilities, long-term 211,483 205,362

Other long-term obligations 427,747 382,383

Total liabilities 3,041,993 3,010,596

Equity:

Total EMCOR Group, Inc. stockholders' equity 2,090,475 2,052,668

Noncontrolling interests 702 576

Total equity 2,091,177 2,053,244

Total liabilities and equity $ 5,133,170 $ 5,063,840

EMCOR GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended June 30, 2021 and 2020

(In thousands) (Unaudited)

2021

2020

Cash flows - operating activities:

Net income (loss) including noncontrolling interests

$

182,293

$

(8,024)

Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:

Depreciation and amortization

24,110

23,220

Amortization of identifiable intangible assets

30,996

29,404

Provision for credit losses

5,536

4,957

Deferred income taxes

(1,355)

(19,942)

Non-cash expense for impairment of goodwill, identifiable intangible assets, and other long-lived assets

-

232,750

Non-cash share-based compensation expense

5,850

5,960

Other reconciling items

(397)

868

Changes in operating assets and liabilities, excluding the effect of businesses acquired

(254,005)

7,550

Net cash (used in) provided by operating activities

(6,972)

276,743

Cash flows - investing activities:

Payments for acquisitions of businesses, net of cash acquired

(55,846)

(3,194)

Proceeds from sale or disposal of property, plant and equipment

1,445

824

Purchases of property, plant and equipment

(16,734)

(25,951)

Distributions from unconsolidated entities

196

-

Net cash used in investing activities

(70,939)

(28,321)

Cash flows - financing activities:

Proceeds from revolving credit facility

-

200,000

Repayments of revolving credit facility

-

(250,000)

Proceeds from long-term debt

-

300,000

Repayments of long-term debt and debt issuance costs

-

(257,549)

Repayments of finance lease liabilities

(2,228)

(2,354)

Dividends paid to stockholders

(14,236)

(8,888)

Repurchases of common stock

(138,030)

(99,048)

Taxes paid related to net share settlements of equity awards

(3,771)

(2,550)

Issuances of common stock under employee stock purchase plan

3,561

3,228

Payments for contingent consideration arrangements

(2,338)

(4,070)

Distributions to noncontrolling interests

(43)

(70)

Net cash used in financing activities

(157,085)

(121,301)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

1,222

(4,701)

(Decrease) increase in cash, cash equivalents, and restricted cash

(233,774)

122,420

Cash, cash equivalents, and restricted cash at beginning of year (1)

903,562

359,920

Cash, cash equivalents, and restricted cash at end of period (2)

$

669,788

$

482,340

EMCOR GROUP, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the Six Months Ended June 30, 2021 and 2020

(In thousands) (Unaudited)

2021 2020

Cash flows - operating activities:

Net income (loss) including noncontrolling $ 182,293 $ (8,024) interests

Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities:

Depreciation and amortization 24,110 23,220

Amortization of identifiable intangible assets 30,996 29,404

Provision for credit losses 5,536 4,957

Deferred income taxes (1,355) (19,942)

Non-cash expense for impairment of goodwill,identifiable intangible assets, and other - 232,750 long-lived assets

Non-cash share-based compensation expense 5,850 5,960

Other reconciling items (397) 868

Changes in operating assets and liabilities, (254,005) 7,550 excluding the effect of businesses acquired

Net cash (used in) provided by operating activities (6,972) 276,743

Cash flows - investing activities:

Payments for acquisitions of businesses, net of (55,846) (3,194) cash acquired

Proceeds from sale or disposal of property, plant 1,445 824 and equipment

Purchases of property, plant and equipment (16,734) (25,951)

Distributions from unconsolidated entities 196 -

Net cash used in investing activities (70,939) (28,321)

Cash flows - financing activities:

Proceeds from revolving credit facility - 200,000

Repayments of revolving credit facility - (250,000)

Proceeds from long-term debt - 300,000

Repayments of long-term debt and debt issuance - (257,549) costs

Repayments of finance lease liabilities (2,228) (2,354)

Dividends paid to stockholders (14,236) (8,888)

Repurchases of common stock (138,030) (99,048)

Taxes paid related to net share settlements of (3,771) (2,550) equity awards

Issuances of common stock under employee stock 3,561 3,228 purchase plan

Payments for contingent consideration arrangements (2,338) (4,070)

Distributions to noncontrolling interests (43) (70)

Net cash used in financing activities (157,085) (121,301)

Effect of exchange rate changes on cash, cash 1,222 (4,701) equivalents, and restricted cash

(Decrease) increase in cash, cash equivalents, and (233,774) 122,420 restricted cash

Cash, cash equivalents, and restricted cash at 903,562 359,920 beginning of year ^(1)

Cash, cash equivalents, and restricted cash at end $ 669,788 $ 482,340 of period ^(2)

_________(1)

Includes $0.7 million and $1.1 million of restricted cash classified as "Prepaid expenses and other" in the Consolidated Balance Sheets as of December 31, 2020 and 2019, respectively.

(2)

Includes $0.9 million of restricted cash classified as "Prepaid expenses and other" in the Consolidated Balance Sheets as of June 30, 2021 and 2020.

_________ Includes $0.7 million and $1.1 million of restricted cash classified as(1) "Prepaid expenses and other" in the Consolidated Balance Sheets as of December 31, 2020 and 2019, respectively.

Includes $0.9 million of restricted cash classified as "Prepaid expenses(2) and other" in the Consolidated Balance Sheets as of June 30, 2021 and 2020.

EMCOR GROUP, INC.

SEGMENT INFORMATION

(In thousands) (Unaudited)

For the three months ended June 30,

2021

2020

Revenues from unrelated entities:

United States electrical construction and facilities services

$

489,487

$

410,388

United States mechanical construction and facilities services

958,686

790,441

United States building services

624,456

478,982

United States industrial services

235,163

241,093

Total United States operations

2,307,792

1,920,904

United Kingdom building services

129,874

93,117

Total operations

$

2,437,666

$

2,014,021

EMCOR GROUP, INC.

SEGMENT INFORMATION

(In thousands) (Unaudited)

For the three months ended June 30,

2021 2020

Revenues from unrelated entities:

United States electrical construction and $ 489,487 $ 410,388 facilities services

United States mechanical construction and 958,686 790,441 facilities services

United States building services 624,456 478,982

United States industrial services 235,163 241,093

Total United States operations 2,307,792 1,920,904

United Kingdom building services 129,874 93,117

Total operations $ 2,437,666 $ 2,014,021



For the six months ended June 30,

2021

2020

Revenues from unrelated entities:

United States electrical construction and facilities services

$

945,655

$

872,191

United States mechanical construction and facilities services

1,862,611

1,624,553

United States building services

1,206,295

1,006,593

United States industrial services

470,545

605,022

Total United States operations

4,485,106

4,108,359

United Kingdom building services

256,609

205,494

Total operations

$

4,741,715

$

4,313,853

For the six months ended June 30,

2021 2020

Revenues from unrelated entities:

United States electrical construction and $ 945,655 $ 872,191 facilities services

United States mechanical construction and 1,862,611 1,624,553 facilities services

United States building services 1,206,295 1,006,593

United States industrial services 470,545 605,022

Total United States operations 4,485,106 4,108,359

United Kingdom building services 256,609 205,494

Total operations $ 4,741,715 $ 4,313,853



EMCOR GROUP, INC.

SEGMENT INFORMATION

(In thousands) (Unaudited)

For the three months ended June 30,

2021

2020

Operating income (loss):

United States electrical construction and facilities services

$

42,705

$

31,626

United States mechanical construction and facilities services

79,259

66,937

United States building services

30,310

26,615

United States industrial services

(208)

3,282

Total United States operations

152,066

128,460

United Kingdom building services

7,047

5,351

Corporate administration

(25,755)

(23,699)

Impairment loss on goodwill, identifiable intangible assets, and other long-lived assets

-

(232,750)

Total operations

133,358

(122,638)

Other items:

Net periodic pension (cost) income

922

718

Interest expense, net

(1,316)

(2,110)

Income (loss) before income taxes

$

132,964

$

(124,030)

EMCOR GROUP, INC.

SEGMENT INFORMATION

(In thousands) (Unaudited)

For the three months ended June 30,

2021 2020

Operating income (loss):

United States electrical construction and $ 42,705 $ 31,626 facilities services

United States mechanical construction and 79,259 66,937 facilities services

United States building services 30,310 26,615

United States industrial services (208) 3,282

Total United States operations 152,066 128,460

United Kingdom building services 7,047 5,351

Corporate administration (25,755) (23,699)

Impairment loss on goodwill, identifiable - (232,750) intangible assets, and other long-lived assets

Total operations 133,358 (122,638)

Other items:

Net periodic pension (cost) income 922 718

Interest expense, net (1,316) (2,110)

Income (loss) before income taxes $ 132,964 $ (124,030)



For the six months ended June 30,

2021

2020

Operating income (loss):

United States electrical construction and facilities services

$

82,969

$

71,938

United States mechanical construction and facilities services

144,209

112,108

United States building services

59,644

47,876

United States industrial services

(2,651)

18,707

Total United States operations

284,171

250,629

United Kingdom building services

16,458

11,115

Corporate administration

(50,267)

(45,568)

Restructuring expenses

-

(69)

Impairment loss on goodwill, identifiable intangible assets, and other long-lived assets

-

(232,750)

Total operations

250,362

(16,643)

Other items:

Net periodic pension (cost) income

1,830

1,460

Interest expense, net

(2,679)

(4,598)

Income (loss) before income taxes

$

249,513

$

(19,781)

EMCOR GROUP, INC. RECONCILIATION OF 2021 AND 2020 NON-GAAP OPERATING INCOME AND NON-GAAP OPERATING MARGIN (In thousands) (Unaudited)

In our press release, we provide non-GAAP operating income and non-GAAP operating margin for the three and six months ended June 30, 2020. The following tables provide a reconciliation between operating income and operating margin determined on a non-GAAP basis to the most directly comparable GAAP measures for such periods.

For the six months ended June 30,

2021 2020

Operating income (loss):

United States electrical construction and $ 82,969 $ 71,938 facilities services

United States mechanical construction and 144,209 112,108 facilities services

United States building services 59,644 47,876

United States industrial services (2,651) 18,707

Total United States operations 284,171 250,629

United Kingdom building services 16,458 11,115

Corporate administration (50,267) (45,568)

Restructuring expenses - (69)

Impairment loss on goodwill, identifiable - (232,750) intangible assets, and other long-lived assets

Total operations 250,362 (16,643)

Other items:

Net periodic pension (cost) income 1,830 1,460

Interest expense, net (2,679) (4,598)

Income (loss) before income taxes $ 249,513 $ (19,781)



EMCOR GROUP, INC. RECONCILIATION OF 2021 AND 2020 NON-GAAP OPERATING INCOME AND NON-GAAP OPERATING MARGIN (In thousands) (Unaudited)

In our press release, we provide non-GAAP operating income and non-GAAP operating margin for the three and six months ended June 30, 2020. The following tables provide a reconciliation between operating income and operating margin determined on a non-GAAP basis to the most directly comparable GAAP measures for such periods.

For the three months ended For the six months ended June 30, June 30,

2021 2020 2021 2020

GAAP operating $ 133,358 $ (122,638) $ 250,362 $ (16,643) income (loss)

Impairment loss ongoodwill,identifiable - 232,750 - 232,750 intangible assets,and other long-livedassets

Non-GAAP operating $ 133,358 $ 110,112 $ 250,362 $ 216,107 income

For the three months ended June 30,

For the six months ended June 30,

2021

2020

2021

2020

GAAP operating margin

5.5

%

(6.1)

%

5.3

%

(0.4)

%

Impairment loss on goodwill, identifiable intangible assets, and other long-lived assets

-

%

11.6

%

-

%

5.4

%

Non-GAAP operating margin

5.5

%

5.5

%

5.3

%

5.0

%

EMCOR GROUP, INC. RECONCILIATION OF 2021 AND 2020 NON-GAAP NET INCOME (In thousands) (Unaudited)

In our press release, we provide non-GAAP net income for the three and six months ended June 30, 2020. The following table provides a reconciliation between net income determined on a non-GAAP basis to the most directly comparable GAAP measure for such periods.

For the three For the six months ended months ended June 30, June 30,

2021 2020 2021 2020

GAAP operating margin 5.5 % (6.1) % 5.3 % (0.4) %

Impairment loss on goodwill, identifiableintangible assets, and other long-lived - % 11.6 % - % 5.4 %assets

Non-GAAP operating margin 5.5 % 5.5 % 5.3 % 5.0 %

EMCOR GROUP, INC. RECONCILIATION OF 2021 AND 2020 NON-GAAP NET INCOME (In thousands) (Unaudited)

In our press release, we provide non-GAAP net income for the three and six months ended June 30, 2020. The following table provides a reconciliation between net income determined on a non-GAAP basis to the most directly comparable GAAP measure for such periods.

For the three months For the six months ended ended June 30, June 30,

2021 2020 2021 2020

GAAP net income (loss) $ 97,350 $ (83,689) $ 182,124 $ (8,024)

Impairment loss ongoodwill, identifiable - 232,750 - 232,750 intangible assets, andother long-lived assets

Tax effect ofimpairment loss ongoodwill, identifiable - (69,865) - (69,865) intangible assets, andother long-lived assets

Non-GAAP net income $ 97,350 $ 79,196 $ 182,124 $ 154,861

EMCOR GROUP, INC. RECONCILIATION OF 2021 AND 2020 NON-GAAP DILUTED EARNINGS PER SHARE (In thousands) (Unaudited)

In our press release, we provide non-GAAP diluted earnings per common share for the three and six months ended June 30, 2020. The following table provides a reconciliation between diluted earnings per common share determined on a non-GAAP basis to the most directly comparable GAAP measure for such periods.

For the three months For the six months ended ended June 30, June 30,

2021 2020 2021 2020

GAAP diluted earnings (loss) $ 1.78 $ (1.52) $ 3.32 $ (0.14) per common share

Impairment loss on goodwill,identifiable intangible assets, - 4.22 - 4.18 and other long-lived assets

Tax effect of impairment losson goodwill, identifiable - (1.27) - (1.25) intangible assets, and otherlong-lived assets

Non-GAAP diluted earnings per $ 1.78 $ 1.44 $ 3.32 $ 2.78 common share

View source version on businesswire.com: https://www.businesswire.com/news/home/20210729005329/en/

CONTACT: EMCOR GROUP, INC. R. Kevin Matz Executive Vice President Shared Services (203) 849-7938

CONTACT: FTI Consulting, Inc. Investors: Haskel Kwestel (212) 850-5646