QUANTA SERVICES INC, QUANTA SERVICES MANAGEMENT ...

Consolidated Results
Year Ended December 31,
2011 2010 2009
Revenues .............................. $4,623,829 100.0% $3,931,218 100.0% $3,318,126 100.0%
Cost of services (including depreciation) ...... 4,003,230 86.6 3,296,795 83.9 2,724,638 82.1
Gross profit ............................. 620,599 13.4 634,423 16.1 593,488 17.9
Selling, general and administrative expenses . . . 372,963 8.1 339,672 8.6 312,414 9.4
Amortization of intangible assets ............ 29,953 0.6 38,568 1.0 38,952 1.2
Operating income ........................ 217,683 4.7 256,183 6.5 242,122 7.3
Interest expense ......................... (1,821) — (4,913) (0.1) (11,269) (0.3)
Interest income .......................... 1,066 — 1,417 — 2,456 —
Loss on early extinguishment of debt, net ..... — — (7,107) (0.2) — —
Other income (expense), net ................ (558) — 675 — 421 —
Income before income taxes ................ 216,370 4.7 246,255 6.2 233,730 7.0
Provision for income taxes ................. 71,954 1.6 90,698 2.3 70,195 2.1
Net income ......................... 144,416 3.1 155,557 3.9 163,535 4.9
Less: Net income attributable to noncontrolling
interests .............................. 11,901 0.2 2,381 — 1,373 —
Net income attributable to common
stock ............................ $ 132,515 2.9% $ 153,176 3.9% $ 162,162 4.9%
2011 compared to 2010
Revenues. Revenues increased $692.6 million, or 17.6%, to $4.62 billion for the year ended
December 31, 2011. Electric power infrastructure service revenues increased $981.4 million, or 47.9%, to $3.03
billion for the year ended December 31, 2011, primarily due to an increase in the number and size of projects as a
result of increased capital spending by our customers, the contribution of $242.2 million in revenues from
acquired businesses and an increase of $76.7 million in revenues from emergency restoration services during
2011 as compared to 2010. Also contributing to the overall revenue increase were higher revenues from
telecommunications infrastructure services, which increased $84.3 million, or 22.6%, to $457.3 million,
primarily as a result of increased capital spending by our customers. Partially offsetting these increases were
lower revenues from natural gas and pipeline infrastructure services, which decreased $378.4 million, or 27.0%,
to $1.02 billion for the year ended December 31, 2011 primarily due to a decrease in the number and size of
natural gas transmission projects that were ongoing during 2011 as compared to 2010.
Gross profit. Gross profit decreased $13.8 million, or 2.2%, to $620.6 million for the year ended
December 31, 2011. As a percentage of revenues, gross margin decreased to 13.4% for the year ended
December 31, 2011 from 16.1% for the year ended December 31, 2010. These decreases were primarily due to
the impact of lower overall revenues from natural gas and pipeline infrastructure services, which resulted in a
lower ability to cover operating overhead costs, as well as the impact of project losses incurred by this segment
during 2011 that primarily resulted from increased project costs related to productivity issues caused by adverse
weather conditions and more stringent application of regulations. Also contributing to these decreases was the
impact of a $32.6 million charge to the Natural Gas and Pipeline Infrastructure Services segment’s cost of
services in the fourth quarter of 2011 associated with the withdrawal of certain of our subsidiaries from an
underfunded multi-employer pension plan. Gross margins were also negatively impacted in 2011 as a result of a
decrease in margins earned by the Electric Power Infrastructure Services segment primarily due to the
completion of certain higher margin electric transmission projects during the year ended December 31, 2010, as
compared to electric transmission projects that were at earlier stages of completion during the year ended
December 31, 2011. The decrease in gross profit was partially offset by the impact of higher overall revenues
from the Electric Power Infrastructure Services segment and the Telecommunications Infrastructure Services
segment as described above.
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