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Bowman Announces Record Full Year 2022 Revenue and Adjusted EBITDA

Bowman Consulting Group Ltd. (Nasdaq: BWMN) (“Bowman” or the “Company”), a national engineering services firm supporting owners and developers of the built environment, today released record financial results for the year ended December 31, 2022.

“During 2022, our first full year as a public company, we exceeded expectations and delivered on our commitment to strategic growth,” said Gary Bowman, Chairman and CEO of Bowman. “We generated record revenue, doubled our adjusted EBITDA, added close to 700 professionals, and made meaningful progress on margin expansion. During the year we closed on eight acquisitions representing over $60 million of annualized revenue as of closing. Demand for infrastructure related design and engineering continues to be strong across our markets, providing us continued optimism about our ability to grow and deliver on our strategic plans for 2023.”

Financial highlights for the three months ended December 31, 2022, compared to December 31, 2021:

  • Gross revenue of $75.6 million, compared to $41.9 million, an 80% increase
  • Year-over-year organic gross revenue growth1 of 30%
  • Net service billing2 of $66.2 million, compared to $37.8 million, a 75% increase
  • Year-over-year organic net service billing growth of 24%
  • Net income of $0.5 million, compared to a net loss of ($0.6) million
  • Adjusted EBITDA2 of $9.4 million, compared to $3.5 million, a 169% increase
  • Adjusted EBITDA margin, net 2 of 14.2%, compared to 9.4%, a 480 bps increase
  • Gross backlog2 of $243 million, compared to $167 million, a 46% increase

Financial highlights for the twelve months ended December 31, 2022, compared to December 31, 2021:

  • Gross revenue of $261.7 million, compared to $150.0 million, a 74% increase
  • Year-over-year organic gross revenue growth of 31%
  • Net service revenue1 of $235.2 million, compared to $134.9 million, 74% increase
  • Year-over-year organic net service billing growth of 26%
  • Net income of $5.0 million, compared to a net income of $0.3 million
  • Adjusted EBITDA1 of $34.0 million, compared to $16.5 million, a 106% increase
  • Adjusted EBITDA margin, net 1 of 14.5%, compared to 12.2%, a 230 bps increase

Business highlights during the fourth quarter 2022:

  • Closed on the acquisition of Spatial Acuity – November 2022
  • Closed on the acquisition of SEI Engineering – November 2022
  • Closed on the acquisition of H2H Geoscience Engineering – December 2022

Increasing FY 2023 Guidance

The Company is increasing its full year 2023 outlook for Net Service Billing to be in the range of $280 to $295 million and Adjusted EBITDA in the range of $43 to $49 million. The current outlook for 2023 is based on completed acquisitions as of the date of this release and does not include contributions from any future acquisitions. Management will discuss the Company’s acquisition pipeline during its upcoming earnings call.

FY 2022 Earnings Webcast

Bowman will host an earnings webcast to discuss the results of the quarter as follows:

Date:

March 10, 2023

Time:

9:00 a.m. Eastern Time

Hosts:

Gary Bowman, Chairman and CEO and Bruce Labovitz, Chief Financial Officer

Where:

http://investors.bowman.com

1

Revenue from acquired companies is reclassified as organic revenue in the first full quarter following the 12-month anniversary of closing.

2

Non-GAAP financial metrics the Company believes offer valuable perspective on results of operations. See Non-GAAP tables below for reconciliations.

About Bowman Consulting Group Ltd.

Headquartered in Reston, Virginia, Bowman is an established professional services firm delivering innovative engineering solutions to customers who own, develop, and maintain the built environment. With over 1,700 employees more than 65 locations throughout the United States, Bowman provides a variety of planning, engineering, construction management, commissioning, environmental consulting, geomatics, survey, land procurement and other technical services to customers operating in a diverse set of regulated end markets. For more information, visit bowman.com or investors.bowman.com.

Forward-Looking Statements

This press release may contain “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. All statements contained in this press release other than statements of historical fact, including statements regarding our future results of operations and financial position, business strategy and plans and objectives for future operations, are forward-looking statements and represent our views as of the date of this press release. The words “anticipate”, “believe”, “continue”, “estimate”, “expect”, “intend”, “may”, “will”, “goal” and similar expressions are intended to identify forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives and financial needs, These forward-looking statements are subject to several assumptions and risks and uncertainties, many of which involve factors or circumstances that are beyond our control that could affect our financial results. The Company cautions that these statements are qualified by important factors that could cause actual results to differ materially from those reflected by the forward-looking statements contained in this news release. Such factors include: (a) changes in demand from the local and state government and private clients that we serve; (b) general economic conditions, nationally and globally, and their effect on the market for our services; (c) competitive pressures and trends in our industry and our ability to successfully compete with our competitors; (d) changes in laws, regulations, or policies; and (e) the “Risk Factors” set forth in the Company’s most recent SEC filings. Considering these risks, uncertainties and assumptions, the future events and trends discussed in this press release may not occur and actual results could differ materially and adversely from those anticipates or implied in any forward-looking statements. Except as required by law, we are under no obligation to update these forward-looking statements after the date of this press release, or to update the reasons if actual results differ materially from those anticipated in the forward-looking statements.

Non-GAAP Financial Measures and Other Key Metrics

We supplement our consolidated financial statements, which are prepared and presented in accordance with GAAP, with certain non-GAAP financial measures, as described below, to help represent, explain, and understand our operating performance. These non-GAAP financial measures may be different than similarly referenced measures used by other companies. The non-GAAP measures are intended to enhance investors’ overall understanding and evaluation of our financial performance and should not be considered a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP. We present these non-GAAP financial measures to assist investors in seeing our financial performance in a manner more aligned with management’s view and believe these measures provide additional tools by which investors can evaluate our core financial performance over multiple periods relative to other companies in our industry. Reconciliations of non-GAAP financial measures to the most directly comparable GAAP financial measures are included in the financial tables accompanying this press release.

CONSOLIDATED BALANCE SHEETS
(Amounts in thousands except per share data)
December 31,

2022
December 31,

2021
 
ASSETS
Current Assets
Cash and equivalents

$

13,282

 

$

20,619

 

Accounts receivable, net

 

64,443

 

 

38,491

 

Contract assets

 

16,321

 

 

9,189

 

Notes receivable - officers, employees, affiliates, current portion

 

1,016

 

 

1,260

 

Prepaid and other current assets

 

7,068

 

 

4,850

 

Total current assets

 

102,130

 

 

74,409

 

Non-Current Assets
Property and equipment, net

 

25,104

 

 

20,202

 

Operating lease, right-of-use assets

 

30,264

 

 

-

 

Goodwill

 

53,210

 

 

28,471

 

Notes receivable

 

903

 

 

903

 

Notes receivable - officers, employees, affiliates, less current portion

 

1,417

 

 

1,218

 

Other intangible assets, net

 

27,950

 

 

12,286

 

Deferred tax asset, net

 

13,759

 

 

-

 

Other assets

 

1,020

 

 

681

 

Total Assets

$

255,757

 

$

138,170

 

LIABILITIES AND EQUITY
Current Liabilities
Accounts payable and accrued liabilities

$

40,293

 

$

17,921

 

Contract liabilities

 

6,370

 

 

4,623

 

Notes payable, current portion

 

10,168

 

 

4,450

 

Deferred rent, current portion

 

-

 

 

724

 

Operating lease obligation, less current portion

 

6,949

 

 

-

 

Finance lease obligation, current portion

 

5,297

 

 

5,136

 

Total current liabilities

 

69,077

 

 

32,854

 

Non-Current Liabilities
Other non-current obligations

 

356

 

 

-

 

Notes payable, less current portion

 

16,276

 

 

8,407

 

Deferred rent, less current portion

 

-

 

 

4,179

 

Operating lease obligation, less current portion

 

28,087

 

 

-

 

Finance lease obligation, less current portion

 

14,254

 

 

10,020

 

Pension and post-retirement obligation, less current portion

 

4,848

 

 

-

 

Deferred tax liability, net

 

-

 

 

4,290

 

Common shares subject to repurchase

 

-

 

 

7

 

Total liabilities

$

132,898

 

$

59,757

 

 
Shareholders' Equity
Preferred Stock, $0.01 par value; 5,000,000 shares authorized, no shares issued and outstanding

$

-

 

$

-

 

Common stock, $0.01 par value; 30,000,000 shares authorized; 15,949,805 shares issued and 13,556,550 outstanding, and 13,690,868 shares issued and 11,489,579 outstanding, respectively

 

159

 

 

137

 

Additional paid-in-capital

 

162,922

 

 

120,842

 

Accumulated other comprehensive income

 

578

 

 

-

 

Treasury stock, at cost; 2,393,255 and 2,201,289, respectively

 

(20,831

)

 

(17,488

)

Stock subscription notes receivable

 

(173

)

 

(277

)

Accumulated deficit

 

(19,796

)

 

(24,801

)

Total shareholders' equity

$

122,859

 

$

78,413

 

 
TOTAL LIABILITIES AND EQUITY

$

255,757

 

$

138,170

 

BOWMAN CONSULTING GROUP LTD.
CONSOLIDATED INCOME STATEMENT
(Amounts in thousands except per share data)
 
For the Three Months

Ended December 31,
For the Year

Ended December 31,

 

2022

 

 

 

2021

 

 

 

2022

 

 

 

2021

 

Gross Contract Revenue

$

75,609

 

$

41,929

 

$

261,714

 

$

149,970

 

Contract costs: (exclusive of depreciation and amortization below)
Direct payroll costs

 

26,753

 

 

16,527

 

 

100,076

 

 

59,416

 

Sub-consultants and expenses

 

9,424

 

 

4,149

 

 

26,510

 

 

15,116

 

Total contract costs

 

36,177

 

 

20,676

 

 

126,586

 

 

74,532

 

Operating Expenses:
Selling, general and administrative

 

34,993

 

 

20,717

 

 

117,839

 

 

69,029

 

Depreciation and amortization

 

3,901

 

 

1,865

 

 

12,251

 

 

6,371

 

(Gain) on sale

 

(39

)

 

(23

)

 

(82

)

 

(122

)

Total operating expenses

 

38,855

 

 

22,559

 

 

130,008

 

 

75,278

 

Income from operations

 

577

 

 

(1,306

)

 

5,120

 

 

160

 

Other expense

 

1,297

 

 

734

 

 

3,384

 

 

1,440

 

Income (loss) before tax expense

 

(720

)

 

(2,040

)

 

1,736

 

 

(1,280

)

Income tax (benefit) expense

 

(1,190

)

 

(1,441

)

 

(3,269

)

 

(1,579

)

Net income

$

470

 

$

(599

)

$

5,005

 

$

299

 

Earnings allocated to non-vested shares

 

67

 

 

-

 

 

783

 

 

56

 

Net income attributable to common shareholders

$

403

 

$

(599

)

$

4,222

 

$

243

 

Earnings per share
Basic

$

0.03

 

$

(0.07

)

$

0.39

 

$

0.03

 

Diluted

$

0.03

 

$

(0.07

)

$

0.37

 

$

0.03

 

Weighted average shares outstanding:
Basic

 

11,538,128

 

 

9,073,424

 

 

10,887,620

 

 

7,525,206

 

Diluted

 

12,234,109

 

 

9,073,424

 

 

11,683,758

 

 

7,635,615

 

BOWMAN CONSULTING GROUP LTD.
CONSOLIDATED STATEMENT OF CASH FLOWS
 
For the Year Ended December 31,

 

2022

 

 

2021

 

Cash Flows from Operating Activities:
Net Income

$

5,005

 

$

299

 

Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization - property, plant and equipment

 

8,363

 

 

5,974

 

Amortization of intangible assets

 

3,888

 

 

397

 

Gain on sale of assets

 

(82

)

 

(122

)

Bad debt

 

742

 

 

496

 

Stock based compensation

 

15,097

 

 

8,217

 

Deferred taxes

 

(18,049

)

 

(2,183

)

Deferred rent

 

-

 

 

5

 

Accretion of discounts on notes payable

 

258

 

 

-

 

Changes in operating assets and liabilities, net of acquisition of businesses
Accounts receivable

 

(13,779

)

 

(8,802

)

Contract assets

 

(4,575

)

 

(387

)

Prepaid expenses

 

(2,021

)

 

(2,251

)

Other assets

 

(105

)

 

(31

)

Accounts payable and accrued expenses

 

15,802

 

 

3,297

 

Contract liabilities

 

(1,374

)

 

(192

)

Net cash provided by operating activities

 

9,170

 

 

4,717

 

Cash Flows from Investing Activities:
Purchases of property and equipment

 

(902

)

 

(905

)

Proceeds from sale of assets

 

35

 

 

127

 

Amounts advanced under loans to shareholders

 

(5

)

 

(779

)

Payments received under loans to shareholders

 

49

 

 

36

 

Acquisitions of businesses, net of cash acquired

 

(18,035

)

 

(20,345

)

Collections under stock subscription notes receivable

 

104

 

 

332

 

Net cash used in investing activities

 

(18,754

)

 

(21,534

)

Cash Flows from Financing Activities:
Proceeds from initial public offering, net of underwriting discounts and commissions and other offering costs

 

-

 

 

47,104

 

Proceeds from common stock offering, net of underwriting discounts and commissions and other offering costs

 

15,475

 

 

-

 

Net payments under revolving line of credit

 

-

 

 

(3,481

)

Repayments under fixed line of credit

 

(734

)

 

(722

)

Repayment under notes payable

 

(4,595

)

 

(1,084

)

Payments on finance leases

 

(6,027

)

 

(4,663

)

Payment of contingent consideration from acquisitions

 

-

 

 

(2

)

Payment of subsequent common stock offering costs

 

-

 

 

(75

)

Payments for purchase of treasury stock

 

(3,343

)

 

(582

)

Proceeds from issuance of common stock

 

1,471

 

 

555

 

Net cash provided by financing activities

 

2,247

 

 

37,050

 

Net (decrease) increase in cash and cash equivalents

 

(7,337

)

 

20,233

 

Cash and cash equivalents, beginning of period

 

20,619

 

 

386

 

Cash and cash equivalents, end of period

$

13,282

 

$

20,619

 

Supplemental disclosures of cash flow information:
Cash paid for interest

$

1,896

 

$

887

 

Cash paid for income taxes

$

400

 

 

1,921

 

Non-cash investing and financing activities:
Property and equipment acquired under capital lease

$

(8,118

)

$

(8,877

)

Stock redemption for exercise of stock option

 

-

 

$

139

 

Issuance of notes payable for acquisitions

$

(19,089

)

$

(10,200

)

BOWMAN CONSULTING GROUP LTD.
RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES
(amounts in thousands except per share data)
 
Condensed Combined Statement of Operations Reconciliation For the Three Months Ended December 31, For the Year Ended December 31,

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Gross contract revenue

$

75,609

 

$

41,929

 

$

261,714

 

$

149,970

 

Contract costs (exclusive of depreciation and amortization)

 

36,177

 

 

20,676

 

 

126,586

 

 

74,532

 

Operating expense

 

38,855

 

 

22,559

 

 

130,008

 

 

75,278

 

Income from operations

 

577

 

 

(1,306

)

 

5,120

 

 

160

 

Other (income) expense

 

1,297

 

 

734

 

 

3,384

 

 

1,440

 

Income tax expense (benefit)

 

(1,190

)

 

(1,441

)

 

(3,269

)

 

(1,579

)

Net income

$

470

 

$

(599

)

$

5,005

 

$

299

 

Net margin

 

0.6

%

 

-1.4

%

 

1.9

%

 

0.2

%

 
Other financial information1
Net service billing

$

66,185

 

$

37,780

 

$

235,204

 

$

134,854

 

Adjusted EBITDA

 

9,415

 

 

3,534

 

 

34,022

 

 

16,485

 

Adjusted EBITA margin, net

 

14.2

%

 

9.4

%

 

14.5

%

 

12.2

%

 
 
Gross Revenue to Net Services Billing Reconciliation For the Three Months Ended December 31, For the Year Ended December 31,

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Gross contract revenue

$

75,609

 

$

41,929

 

$

261,714

 

$

149,970

 

Less: sub-consultants and other direct expenses

 

9,424

 

 

4,149

 

 

26,510

 

 

15,116

 

Net services billing

$

66,185

 

$

37,780

 

$

235,204

 

$

134,854

 

 
 
 
Adjusted EBITDA Reconciliation For the Three Months Ended December 31, For the Year Ended December 31,

 

2022

 

 

2021

 

 

2022

 

 

2021

 

Net Income

$

470

 

$

(599

)

$

5,005

 

$

299

 

+ interest expense

 

1,234

 

 

268

 

 

2,457

 

 

918

 

+ depreciation & amortization

 

3,901

 

 

1,865

 

 

12,251

 

 

6,371

 

+ tax (benefit) expense

 

(1,190

)

 

(1,441

)

 

(3,269

)

 

(1,579

)

EBITDA

$

4,415

 

$

93

 

$

16,444

 

$

6,009

 

+ non-cash stock compensation

 

3,922

 

 

2,876

 

 

15,409

 

 

8,217

 

+ transaction related expenses

 

-

 

 

-

 

 

-

 

 

1,555

 

+ settlements and other non-core expenses

 

439

 

 

-

 

 

654

 

 

-

 

+ acquisition expenses

 

639

 

 

565

 

 

1,515

 

 

704

 

Adjusted EBITDA

$

9,415

 

$

3,534

 

$

34,022

 

$

16,485

 

Adjusted EBITDA margin, net

 

14.2

%

 

9.4

%

 

14.5

%

 

12.2

%

1

Non-GAAP financial metrics the Company believes offer valuable perspective on results of operations. See Non-GAAP tables below for reconciliations.

BOWMAN CONSULTING GROUP LTD.

GROSS CONTRACT REVENUE COMPOSITION

(Amounts in thousands)

 
(dollars in thousands) For the Year ended December 31,
Consolidated Gross Revenue

2022

%

2021

%

Change % Change
Building Infrastructure

170,431

65.1%

105,242

70.2%

65,189

61.9%

Transportation

44,846

17.1%

16,537

11.0%

28,309

171.2%

Power and Utilities

32,672

12.5%

22,525

15.0%

10,147

45.0%

Emerging Markets

13,765

5.3%

5,666

3.8%

8,099

142.9%

Total

261,714

100.0%

149,970

100.0%

111,744

74.5%

 
 
For the Year ended December 31,
Organic v Acquired Revenue 1

2022

% GCR

2021

% GCB Change % Change
Baseline organic revenue

193,251

73.8%

148,021

98.7%

45,230

30.6%

Acquired revenue

68,463

26.2%

1,949

1.3%

66,514

n/a

Total

261,714

100.0%

149,970

100.0%

111,744

74.5%

 
 
(dollars in thousands) For the three months ended December 31,
Consolidated Gross Revenue

2022

%

2021

%

Change % Change
Building Infrastructure

44,338

58.6%

31,559

75.3%

12,779

40.5%

Transportation

18,382

24.3%

3,845

9.2%

14,537

378.1%

Power and Utilities

8,302

11.0%

4,925

11.7%

3,377

68.6%

Emerging Markets

4,587

6.1%

1,600

3.8%

2,987

186.7%

Total

75,609

100.0%

41,929

100.0%

33,680

80.3%

 
 
For the three months ended December 31,
Organic v Acquired Revenue 1

2022

%

2021

%

Change % Change
Baseline organic revenue

51,870

68.6%

39,980

95.4%

11,890

29.7%

Acquired revenue

23,739

31.4%

1,949

4.6%

21,790

n/a

Total

75,609

100.0%

41,929

100.0%

33,680

80.3%

1

Revenue from acquired companies is reclassified as organic revenue in the first full quarter following the 12-month anniversary of closing.

BOWMAN CONSULTING GROUP LTD.

GROSS BACKLOG BY CATEGORY AT DECEMBER 31, 2022

 
Category Percentage
Building Infrastructure

51.2%

Transportation

30.6%

Power and Utilities

13.4%

Emerging Markets

4.8%

TOTAL

100.0%

 

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