Primoris Services Corporation Receives Projects Valued at Approximately $1.1 Billion
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The announcement by Primoris Services Corporation of securing contracts valued at approximately $1.1 billion is a significant development that could have a material impact on the company's financial performance. The size of the contracts, particularly the $700 million for utility-scale solar projects and the $350 million natural gas repowering project, represents a substantial addition to the company's backlog, which is a critical indicator of future revenue. This influx of new projects could potentially improve the company's revenue visibility and earnings stability over the next few years.
Investors should note that the timing of these projects, with commencements slated for 2024 and 2025, may affect the company's financials in a staggered manner. It's also important to consider the company's capacity to manage large-scale projects and the associated risks, such as cost overruns or delays. The impact on the stock will likely be influenced by the market's perception of the company's ability to execute these projects efficiently and profitably.
The energy sector is witnessing a growing transition towards renewable sources and Primoris's focus on utility-scale solar projects aligns with broader market trends. The investment in renewable energy infrastructure indicates a strategic positioning to capitalize on the increasing demand for clean energy solutions. From a market perspective, the ability to secure large contracts across different states highlights Primoris's competitive strength and the potential for geographic expansion.
Moreover, the inclusion of a battery energy storage component in the natural gas repowering project suggests an awareness of the importance of energy storage in enhancing grid stability and reliability. This could position Primoris favorably within the energy industry as storage solutions become increasingly critical to the integration of renewable energy sources.
Primoris's engagement in utility-scale solar projects and a natural gas repowering project with battery energy storage is indicative of the energy sector's evolution. The dual focus on solar and natural gas, coupled with energy storage, reflects a balanced approach to energy generation, catering to immediate demand while also investing in the long-term shift to renewables.
Understanding the complexity of engineering, procurement and construction (EPC) contracts is essential. These contracts involve the delivery of a complete facility to a developer who need only turn a key to start operating the facility. Given the large scale and complexity of these projects, Primoris's expertise in execution will be critical. The company's ability to secure such substantial contracts may suggest a strong track record and specialized skills in EPC for energy infrastructure projects.
“Our strong client relationships and execution expertise continue to drive growth in our backlog of projects in the Energy segment,” said Tom McCormick, President and Chief Executive Officer of Primoris. “These awards span across three states and will help to meet the energy needs of thousands of homes in the communities we serve. I am pleased with the hard work and dedication of our teams to close out 2023 with a deep backlog of projects and for starting 2024 on the right track.”
The solar projects are scheduled to begin in the second and third quarters of 2024 and in early 2025 while the repowering project is expected to begin construction in the second half of 2024.
About Primoris
Primoris Services Corporation is a premier specialty contractor providing critical infrastructure services to the utility, energy, and renewables markets throughout
FORWARD LOOKING STATEMENTS
This press release contains certain forward-looking statements that reflect, when made, the Company’s expectations or beliefs concerning future events that involve risks and uncertainties, including the Company’s future performance. Forward-looking statements include all statements that are not historical facts and can be identified by terms such as “anticipates”, “believes”, “could”, “estimates”, “expects”, “intends”, “may”, “plans”, “potential”, “predicts”, “projects”, “should”, “will”, “would” or similar expressions. Forward-looking statements include information concerning our possible or assumed future results of operations, business strategies, financing plans, competitive position, industry environment, potential growth opportunities, the effects of regulation and the economy, generally. Forward-looking statements inherently involve known and unknown risks, uncertainties, and other factors, which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Actual results may differ materially as a result of a number of factors, including, among other things, the risks described in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2022, and our other filings with the
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Blake Holcomb
Vice President, Investor Relations
214-545-6773
bholcomb@prim.com
Source: Primoris Services Corporation
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