Primoris (PRIM) Wins $120M Solar Contracts, Boosts Backlog
Primoris Services (PRIM) receives an engineering, procurement and construction services contract for two solar projects, thereby fortifying the Energy...
Primoris Services Corporation PRIM has received two solar contracts for engineering, procurement, and construction of a utility-scale solar facility in Southwest and Midwest for more than $120 million under the Energy/Renewables segment.
Work at both the sites includes all civil, electrical and mechanical work expected to begin in third-quarter 2021. While work in the Midwest is expected to be completed in second-quarter 2022, the same in Southwest is likely to end in the third quarter.
President and chief executive officer of Primoris, Tom McCormick, said, “We have now executed three contracts in the last week for a combined total of over $220 million that add to our backlog in the Energy/Renewables segment and we have more to come.”
Solid Project Execution Bodes Well
Primoris — which shares space with Granite Construction Incorporated GVA, EMCOR Group, Inc. EME and Sterling Construction Company Inc. STRL in the same industry — has been reaping benefits from strong project execution.
Recently, it received a contract for engineering, procurement and construction of a thermal power project worth $100 million. The company’s Energy/Renewables segment has secured this contract to offer the above-mentioned services to a 200 MW of thermal power in two different locations in the Southwest.
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Although shares of the company have lagged the Zacks Building Products - Heavy Construction industry in the past three months, the company has been benefiting from solid performance across the two segments — Utility and Energy/Renewables.
Precisely, during second-quarter 2021, the Utility Segment witnessed 25% revenue growth from a year ago, primarily due to the Future Infrastructure acquisition and increased activity with a significant customer in California. Meanwhile, solar projects continued to drive the Energy/Renewables segment. This segment’s revenues grew 20% and gross profit increased 84% year over year.
Total backlog was $2.9 billion at the end of second-quarter 2021. This Zacks Rank #5 (Strong Sell) company achieved record Master Service Agreements/MSA backlog of $1.5 billion during the second quarter, which comprised 52% of the total backlog, despite the winter storm that hit Texas in the first quarter and historically wet weather conditions in the second quarter that pushed some of its revenues further out in the year.
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