Dycom Announces Fiscal 2008 Third Quarter Results and Provides Guidance for the Fourth Quarter of Fiscal 2008

PALM BEACH GARDENS, Fla., May 20 /PRNewswire-FirstCall/ -- Dycom Industries, Inc. (NYSE:DY) announced today its results for the third quarter ended April 26, 2008. The Company reported income from continuing operations for the quarter ended April 26, 2008 of $7.7 million, or $0.19 per common share diluted, versus income from continuing operations for the quarter ended April 28, 2007 of $12.6 million, or $0.31 per common share diluted. Net income, including the results of discontinued operations, for the quarter ended April 26, 2008 was $6.9 million, or $0.17 per common share diluted, compared to net income of $12.4 million, or $0.31 per common share diluted, for the quarter ended April 28, 2007. Total contract revenues from continuing operations for the quarter ended April 26, 2008 were $293.4 million compared to $291.6 million for the quarter ended April 28, 2007, an increase of 0.6%. Stock based compensation expense for the each of the quarters ended April 26, 2008 and April 28, 2007 was $1.4 million, on a pre-tax basis.

Income from continuing operations for the quarter ended April 26, 2008 included a reduction of interest and income tax expense of $0.3 million and $0.9 million, respectively, related to the reversal of certain income tax related liabilities and a reduction of $1.7 million in the cost of earned revenues related to the reversal of a pre-acquisition payroll related accrual. The aggregate effect of these items was to increase income from continuing operations by $2.1 million, net of tax, or $0.05 per common share diluted for the quarter ended April 26, 2008. Income from continuing operations for the quarter ended April 28, 2007 included a gain on sale of real estate of $1.5 million, net of tax, or $0.04 per common share diluted. On a non-GAAP basis, excluding the aforementioned items, income from continuing operations for the quarter ended April 26, 2008 was $5.5 million, or $0.14 per common share diluted, versus $11.1 million, or $0.27 per common share diluted, for the quarter ended April 28, 2007. See the attached tables which present a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

For the nine months ended April 26, 2008 income from continuing operations was $19.8 million, or $0.48 per common share diluted, versus income from continuing operations for the nine months ended April 28, 2007 of $27.7 million, or $0.68 per common share diluted. Net income, including the results of discontinued operations, for the nine months ended April 26, 2008 was $18.6 million or $0.45 per common share diluted, compared to net income of $27.6 million, or $0.68 per common share diluted for the nine months ended April 28, 2007. Total contract revenues from continuing operations for the nine months ended April 26, 2008 were $907.9 million compared to $820.5 million for the nine months ended April 28, 2007, an increase of 10.6%. Stock based compensation expense for the nine months ended April 26, 2008 and the nine months ended April 28, 2007 was $4.6 million and $4.8 million, respectively, on a pre-tax basis.

Income from continuing operations for the nine months ended April 26, 2008 included the accrual of $7.6 million related to the previously announced wage and hour class action settlement with respect to three of the Company's subsidiaries. Additionally, income from continuing operations includes a reduction of interest and income tax expense of $0.3 million and $0.9 million, respectively, related to the reversal of certain income tax related liabilities and a reduction of $1.7 million in the cost of earned revenues related to the reversal of a pre-acquisition payroll related accrual. On a combined basis, these items decreased income from continuing operations $2.5 million, net of tax, or $0.06 per common share diluted for the nine months ended April 26, 2008. Income from continuing operations for the nine months ended April 28, 2007 included a gain on sale of real estate of $1.5 million, net of tax, or $0.04 per common share diluted. On a non-GAAP basis, excluding the aforementioned items, income from continuing operations for the nine months ended April 26, 2008 was $22.3 million, or $0.54 per common share diluted, versus $26.2 million, or $0.65 per common share diluted, for the nine months ended April 28, 2007. See the attached tables which present a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures.

Dycom also announced its outlook for the fourth quarter of fiscal 2008. The Company currently expects revenue from continuing operations for the fourth quarter of fiscal 2008 to range from $305 million to $325 million and diluted earnings per share from continuing operations to range from $0.18 to $0.23, including stock based compensation expense of approximately $1.1 million on a pre-tax basis. Management currently believes that discontinued operations will not have a material impact on the quarter.

A Tele-Conference call to review the Company's results and address its outlook will be hosted at 9:00 a.m. (ET), Wednesday, May 21, 2008; Call 800- 230-1096 (United States) or 612-332-0107 (International) and request "Dycom Results" conference call. A live webcast of the conference call, along with a slide presentation, will be available at http://www.dycomind.com under the heading "Investors" and subheading "Event Details." If you are unable to attend the conference call at the scheduled time, a replay of the live webcast and the slide presentation will be available at http://www.dycomind.com until Friday, June 20, 2008.

Dycom is a leading provider of specialty contracting services throughout the United States. These services include engineering, construction, maintenance and installation services to telecommunications providers, underground facility locating services to various utilities including telecommunications providers, and other construction and maintenance services to electric utilities and others.

Fiscal 2008 third quarter and nine-month results are preliminary and are unaudited. This press release contains forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act. Such statements include, but are not limited to, the Company's expectations for revenues, stock-based compensation expense and earnings per share. These statements are based on management's current expectations, estimates and projections. Forward-looking statements are subject to risks and uncertainties that may cause actual results in the future to differ materially from the results projected or implied in any forward-looking statements contained in this press release. Such risks and uncertainties include: business and economic conditions in the telecommunications industry affecting our customers, the adequacy of our insurance and other reserves and allowances for doubtful accounts, whether the carrying value of our assets may be impaired, whether acquisitions can be efficiently integrated into our existing operations, the impact of any future acquisitions, the anticipated outcome of other contingent events, including litigation, liquidity needs and the availability of financing, as well as other risks detailed in our filings with the Securities and Exchange Commission. The Company does not undertake to update forward-looking statements.

                             ---Tables Follow---



    NYSE: "DY"

    DYCOM INDUSTRIES, INC. AND SUBSIDIARIES
    CONDENSED CONSOLIDATED BALANCE SHEETS
    April 26, 2008 and July 28, 2007
    Unaudited

                                                  April 26,         July 28,
                                                    2008              2007
                                                 ----------        ---------
                                                         ($ in 000's)
    ASSETS
    Current Assets:
    Cash and equivalents                           $25,040           $18,862
    Accounts receivable, net                       127,856           146,864
    Costs and estimated earnings in
     excess of billings                             84,764            95,392
    Deferred tax assets, net                        19,229            15,478
    Income taxes receivable                          9,380               -
    Inventories                                      8,854             8,268
    Other current assets                             9,628             7,266
    Current assets of discontinued operations          171               307
                                                 ---------         ---------

    Total current assets                           284,922           292,437

    Property and equipment, net                    177,027           164,544
    Intangible assets, net                         314,584           320,952
    Other                                           10,668            11,831
                                                 ---------         ---------
    Total                                         $787,201          $789,764
                                                 =========         =========

    LIABILITIES AND STOCKHOLDERS' EQUITY
    Current Liabilities:
    Accounts payable                               $28,778           $30,375
    Current portion of debt                          2,518             3,301
    Billings in excess of costs and
     estimated earnings                                613               712
    Accrued self-insured claims                     31,652            26,902
    Income taxes payable                               -               1,947
    Other accrued liabilities                       55,479            63,076
    Current liabilities of discontinued
     operations                                      1,608               939
                                                 ---------         ---------

    Total current liabilities                      120,648           127,252

    Long-term debt                                 151,529           163,509
    Accrued self-insured claims                     35,468            33,085
    Deferred tax liabilities, net non-
     current                                        20,599            19,316
    Other liabilities                                6,953             1,322
    Non-current liabilities of
     discontinued operations                           507               649

    Stockholders' Equity                           451,497           444,631
                                                 ---------         ---------

    Total                                         $787,201          $789,764
                                                 =========         =========



    NYSE: "DY"

    DYCOM INDUSTRIES, INC. AND SUBSIDIARIES
    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
    Unaudited

                             Three Months Three Months Nine Months Nine Months
                                Ended        Ended        Ended       Ended
                               April 26,   April 28,     April 26,   April 28,
                                 2008        2007          2008        2007
                             ------------ ------------ ----------- -----------
                                    (In 000's, except per share amounts)

    Contract revenues           $293,440    $291,643     $907,869    $820,488
                             ------------ ------------ ----------- -----------

    Cost of earned revenues,
     excluding depreciation
     and amortization            239,598     233,657      748,816     662,193
    General and administrative
     expenses (1)                 24,969      23,712       72,892      66,786
    Depreciation and
     amortization                 17,301      15,327       50,258      41,964
                             ------------ ------------ ----------- -----------

    Total                        281,868     272,696      871,966     770,943
                             ------------ ------------ ----------- -----------

    Interest income                  238         174          619         801
    Interest expense              (3,110)     (3,596)     (10,231)    (11,306)
    Other income, net              2,670       5,189        5,040       6,814
                             ------------ ------------ ----------- -----------

    Income from continuing
     operations before income
     taxes                        11,370      20,714       31,331      45,854

    Provision for income
     taxes                         3,677       8,144       11,515      18,110
                             ------------ ------------ ----------- -----------

    Income from continuing
     operations                    7,693      12,570       19,816      27,744

    Loss from discontinued
     operations, net of tax
     (2)                            (807)       (125)      (1,228)       (154)
                             ------------ ------------ ----------- -----------

    Net income                    $6,886     $12,445      $18,588     $27,590
                             ============ ============ =========== ===========

    Earnings per common share
     - Basic:

    Income from continuing
     operations                    $0.19       $0.31        $0.49       $0.69
    Loss from discontinued
     operations                    (0.02)          -        (0.03)      (0.01)
                             ------------ ------------ ----------- -----------
    Net income                     $0.17       $0.31        $0.46       $0.68
                             ============ ============ =========== ===========

    Earnings per common share
     - Diluted:

    Income from continuing
     operations                    $0.19       $0.31        $0.48       $0.68
    Loss from discontinued
     operations                    (0.02)          -        (0.03)          -
                             ------------ ------------ ----------- -----------
    Net income                     $0.17       $0.31        $0.45       $0.68
                             ============ ============ =========== ===========

    Shares used in computing
     earnings per common
     share:
       Basic                  40,436,212  40,469,787   40,651,236  40,324,503
                             ============ ============ =========== ===========

       Diluted                40,486,765  40,770,976   40,865,349  40,622,116
                             ============ ============ =========== ===========


    Earnings per share amounts may not add due to rounding.

    (1) Includes stock-based compensation expense of $1.4 million and $4.6
        million for the three and nine months ended April 26, 2008,
        respectively, and $1.4 million and $4.8 million for the three and nine
        months ended April 28, 2007, respectively.

    (2) The Company discontinued the operations of one of its subsidiaries in
        fiscal 2007 and has reported those results separately as discontinued
        operations in the financial statements for all periods presented.



    NYSE: "DY"

    DYCOM INDUSTRIES, INC. AND SUBSIDIARIES
    RECONCILIATION OF GAAP TO NON-GAAP INFORMATION
    Unaudited

                            Three Months Three Months Nine Months Nine Months
                                Ended        Ended        Ended       Ended
                               April 26,   April 28,     April 26,   April 28,
                                 2008        2007          2008        2007
                             ------------ ------------ ----------- -----------
                                    (In 000's, except per share amounts)
    Items:
    Charge for wage and hour
     litigation                       $-          $-       $(7,591)      $-
    Reversal of interest expense
     on income tax related
     liabilities                       339         -           339       -
    Reversal of income tax
     related liabilities               858         -           858       -
    Reversal of pre-acquisition
     payroll related accruals        1,680         -         1,680
    Gain on sale of real estate       -         2,485         -        2,485
                                  ----------  ----------   --------- ---------
                                    $2,877      $2,485     $(4,714)    $2,485
                                  ==========  ==========   ========= =========


    GAAP income from continuing
     operations                     $7,693     $12,570     $19,816    $27,744
    Adjustment for items above,
     net of tax                     (2,144)     (1,508)      2,451     (1,508)
                                  ----------  ----------   --------- ---------
    Non-GAAP income from
     continuing operations          $5,549     $11,062     $22,267    $26,236
                                  ==========  ==========   ========= =========

    Earnings per common share
     from continuing operations:

    Basic earnings per share
     from continuing operations
     - GAAP                           $.19        $.31        0.49       $.69
    Adjustment for items above       (0.05)      (0.04)       0.06      (0.04)
                                  ----------  ----------   --------- ---------
    Basic earnings per share
     from continuing operations
     - Non-GAAP (1)                   $.14        $.27        0.55      $0.65
                                  ==========  ==========   ========= =========

    Diluted earnings per share
     from continuing operations
     - GAAP                          $0.19       $0.31        0.48      $0.68
    Adjustment for items above       (0.05)      (0.04)       0.06      (0.04)
                                  ----------  ----------   --------- ---------
    Diluted earnings per share
     from continuing operations-
     Non-GAAP (1)                    $0.14       $0.27        0.54      $0.65
                                  ==========  ==========   ========= =========


    Shares used in computing
     GAAP earnings per common
     share from continuing
     operations and adjustment
     for items above (2):

       Basic                    40,436,212  40,469,787  40,651,236  40,324,503
                               =========== ===========  ==========  ==========

       Diluted                  40,486,765  40,770,976  40,865,349  40,622,116
                               =========== ===========  ==========  ==========

    Shares used in computing
     Non-GAAP earnings per
     common share from
     continuing operations (2):

       Basic                    40,436,212  40,469,787  40,651,236  40,324,503
                               =========== ===========  ==========  ==========

       Diluted                  40,486,765  40,770,976  40,901,585  40,622,116
                               =========== ===========  ==========  ==========


    (1) Amounts may not add due to rounding.

    (2) On August 28, 2007, the Company's Board of Directors authorized
    the repurchase of up to $15 million of its common stock over an
    eighteen month period in open market or private transactions. The
    Company repurchased 922,200 shares of its common stock during the
    three months ended April 26, 2008.  The total amount repurchased
    during the nine months ended April 26, 2008 was 1,016,200 shares.

Source: Dycom Industries, Inc.

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