Q3 2023 Comfort Systems USA Inc Earnings Call
Thank you for standing by and welcome to the Q3 'twenty to 'twenty three comfort systems USA earnings Conference call.
At this time all participants are in a listen only mode.
After the Speakers' presentation, there'll be a question and answer session.
Ask a question at that time, Please press star one wanted your telephone.
Please be advised for today's call is being recorded.
And now I'll turn the call for studios, Julie shape, Chief Accounting Officer. Please go ahead.
Thanks, Valerie and good morning, welcome to comfort systems, Usa's third quarter 2023 earnings call our comments today as well as our press releases contain forward looking statements within the meaning of the applicable securities laws and regulations.
We don't play today is based upon our current plans and expectations of comfort.
These systems USA those plans and expectations include risks and uncertainties that might cause actual future activities and results of our operations to be materially different from those set forth in our comments you can read a detailed listing and commentary concerning our specific risk factors in our most recent Form 10-K and form 10.
Q as well as in our press release covering these earnings.
Good presentation.
Alrighty excellent.
Companion to our remarks.
<unk> posted on the Investor Relations section of the company's website found at comfort systems USA Dot com.
Joining me on the call today are Brian Lane, President and Chief Executive Officer, Trent Mckenna, Chief operating Officer, and Bill George Chief Financial Officer.
One was in our remarks.
Thanks Julie.
Morning, everyone and thank you for joining us on the call today.
I am in all of the discipline and execution that our amazing teams continue to demonstrate and build on.
They are the true source of our exceptional results this quarter.
Our best ever gross earn.
Earnings and cash flow.
Well you answered all of the 93 cents per share this quarter compared to $1 71, a year ago.
Current quarter revenue was $1 $4 billion.
With same store growth of 20%.
Revenue was higher across our operations.
The modular business in particular surged.
While maintaining superb execution for our customers.
Service also continues to grow and increase earnings thanks in large part to past and ongoing investments.
Our mechanical and electrical operations performed incredibly well.
Backlog continues to track at unprecedented levels and.
Our pipeline of additional work is still strong.
Backlog is $4 $3 billion $1 billion ahead of last year, and we also booked a sequential increase even though this is our seasonally most active quarter.
Demand is especially robust and our industrial sectors.
Unprecedented demand for data chip in battery and strong churn trends in other areas like food.
And health care.
To give our teams the opportunity to show their expertise and commitment.
We are carefully selecting work that has good margins and good working conditions for our valuable workforce.
Operating cash flow surged this quarter to over $200 million as our customers continue to recognize our value and performance with favorable payment terms and timely payments.
Today, we also increased our quarterly dividend by two and a half cents to <unk> 25 cents per share.
Or a rate of one dollar per share on an annualized basis.
This reflects our continuing our continuing strong cash flow and our commitment to reward our shareholders.
We are also excited to announce that on October 2nd we acquired Deco and extremely capable pipe and mechanical company located in Maine, New Hampshire.
And we welcome their team to comfort systems.
We'll discuss our business outlook in a few minutes, but first I will turn this call over to Bill to review our financial performance.
Thanks, Brian.
And amazing third quarter.
20% same store revenue growth higher margins and over $200 million of operating cash flow and.
In addition, compared to last year, both our EPS and EBITDA increased by over 50%.
Revenue for the third quarter of 2023 was $1 4 billion, an increase of 23% or $258 million compared to last year.
Our mechanical segment revenue increased by $173 million or 20% and continues to benefit from growth in our modular business.
Our electrical segment increased by an even larger 33% to $347 million.
Combined same store revenue increased by 21.
Our $224 million as we continue to benefit from strong demand and some pass through effects of inflation.
We are facing tougher revenue comparables in the fourth quarter of the year and we currently estimate that same store revenue growth in the fourth quarter will be in the mid teens.
Gross profit was $277 million for the third quarter, a $75 million improvement compared to a year ago.
Our gross profit percentage improved to 21% this quarter compared to 18, 1% for the third quarter of 2022, driven by improved mechanical margins.
Quarterly gross profit exceeded 20% for the first time in a few years. This quarter. We grew by over 20% on a same store basis and added two four percentage points to our gross profit margin and extraordinary operational accomplishment.
Gross profit percentage in our mechanical segment improved to 24% this year as compared to 17, 6% last year.
Margins in our electrical segment declined slightly in the quarter to 19, 4% as compared to 19, 7% in Q3 2022, However last year, our electrical segment benefited from a litigation win.
So core execution and electrical profit profitability was also notably higher.
We are optimistic that for the fourth quarter and next year margins can trend and the strong ranges that we achieved over the last few quarters.
SG&A expense for the quarter was $143 million or 10, 4% of revenue compared to $121 million or 10, 8% of revenue for the third quarter in 2022.
On a same store basis, SG&A was up approximately $18 million due to inflation and ongoing investments to support our much higher activity levels, but the growth in our SG&A costs were slower than our growth in revenue, resulting in SG&A leverage this quarter as compared to last year.
Our operating income increased by 66% from last year to $135 million.
With improved mechanical margins and SG&A leverage our operating income percentage improved to nine 8%. This quarter, an all time high from seven 3% for the third quarter of 2022.
Interest expense for the first nine months of 2023 continues to benefit from our extremely strong cash flow it.
It is also partially in temporarily offset by interest income related to a favorable legal out earlier this year.
Our year to date tax rate of 16, 1% included an incremental benefit of $10 million or 27 sensitive tax gains related to prior years, although individual items have affected our tax rate lately, we estimate that our normalized tax rate for us is approximately 20% to 22%.
After considering all these factors net income for the third quarter of 2023 was $105 million or $2 93 per share.
This compares to net income for the third quarter of 2022 of $62 million or $1 71 per share.
Excluding prior year tax gain earnings per share increased to $2 74 per share from $1 67 per share in the prior year, an increase of 64%.
EBITDA increased from $101 million in the third quarter of last year to $156 million this quarter.
Increase of 54%.
Free cash flow for the first nine months of 2023 was a remarkable $402 million we.
We continue to benefit from advanced payments for work that we will need to fund and complete in upcoming quarters.
Our trailing 12 month operating cash flow exceeds our trailing 12 months earnings by an astounding $300 million.
That over collection must reverse at some point as we pay to perform the work that we have already been paid for.
But that timing is unknown and it is dependent on the timing of future orders in future advance payments and.
In the meantime, these collections have allowed us to lower our debt and our interest costs tremendously.
So far this year.
$64 million on Capex capital expenditures, which is double the amount we expect at this time last year.
The increase includes the build out of two vast new modular production facilities and the purchase of vehicles as we catch up from Covid.
Our substantial cash flow allowed us to pay down our revolving credit facility to zero this quarter.
And to reduce our overall debt by $209 million since the year began and.
During that time, we also funded the purchase of <unk> from our current cash flow.
We continue to purchase our shares and have acquired 64000, so far this year at an average price of $134 53.
Finally.
As Brian mentioned, we acquired Deco at the beginning of October.
We expect Deco to initially contribute annualized revenues of approximately $50 million to $65 million at margins that are consistent with our overall business.
They will be included in our mechanical segment.
So I've got our financials Bryan.
Thanks Bill.
Our backlog at the end of the third quarter was $4 3 billion.
Since last year at this time, our same store backlog has increased by zero point $9 billion around 27%.
With increases in our traditional mechanical and electrical business.
Substantial new bookings and our off site construction operations.
Sequential backlog increased by $102 million, despite heavy revenue volume over the past three months.
Our pipeline of future work remains strong.
Our revenue mix continues to trend towards data centers life science food and other manufacturing such as chip plants and battery.
Those industrial customers accounted for 54% of total revenue.
First nine months of 2023.
And they are major drivers of pipeline and backlog.
Technology, which is included in industrial was 21% of our revenue in the first nine months of 2023.
A substantial increase from 13% in the prior year.
Institutional markets, which include education.
<unk> care in government.
Were also strong and represent 27% of our revenue.
The commercial sector is active.
With our changing mix. It is now a smaller part of our business.
At about 19% of revenue.
And most of that commercial revenue is service.
Yes.
Year to date construction was 80% of our revenue.
With projects for new buildings at 55%.
While the existing building construction was 25%.
Service revenue increased by 14% year to date compared to last year.
Service was 20% of our total revenues.
With service projects, providing 9% of total revenue and pure service include.
Including hourly work, providing a 11% of revenue.
Service revenue continues to be about 20% of our total revenue and our service business is on track.
To be $1 billion of revenue for full year 2023.
In both service and construction, we are encouraging and supporting our customers as they seek to improve the efficiency and sustainability of their buildings and operations.
And we are committed to being good members of the diverse communities we serve.
Comfort systems is fortunate to have the right capabilities to.
To help meet the surge in need for mechanical and electrical experts.
To grow data capacity.
Artificial intelligence.
To help increase our country's capacity.
To build its own chips manner.
Manufacture its own medicines suppliers.
Supply it's batteries and.
And provide health care resources as our population ages.
We are thriving because of our people's commitment excellence and hard work.
And because of our field leaders discernment and choosing projects and managing risk.
Thanks to them, we feel confident in our prospects for continued growth and strong profitability into 2024.
Our number one priority remains to preserve and grow the best workforce in our industry.
We are grateful for their and your trust.
I want to end by thanking our over 15000 employees for their hard work and dedication.
I'll now turn it back over to Valerie for questions. Thank you.
Thank you again, ladies and gentlemen, if you'd like to ask a question. Please press star one on your telephone again to ask a question. Please press star 111 moment for our first question.
Our first question comes from the line of Brent Thielman of D. A Davidson your line is open.
Hey, Thanks, good morning, great quarter.
Hey, Brian.
Brian or bill.
I heard your comments that you had anticipated margin sort of hanging around the range.
Gov.
Last few quarters that any reason to think the margins would be down next year.
Given this year's really strong performance.
Not really as you know Brad you're going to have my does move up and down quarter to quarter a little bit.
But.
The aggregate if you look over the whole year I think we will continue to perform at a very high level into 2024.
Over 20% as you know is extraordinary alright.
In the high teens that we've been hitting I would anticipate continued continuing to hit that.
Okay. Okay.
Okay and then.
When you referred to a cash flow sort of headwind in the coming quarters.
Do you anticipate cash flow sorting getting back that historic conversion rate or how are you thinking about that.
So it's.
If you if you combined time period, that's easy we're going to cash flow our after tax earnings.
We're in an interesting situation now where we've collected hundreds of millions of dollars before we've gone out and done the work on it.
There will be quarters at some point in the future maybe middle of next year, but maybe not where we will be paying the guy who's doing the work we've already been paid for so we could have some cash flow quarters, where.
Where that has to be reflected in our cash flow at the same time, we will keep making money on all the work we're doing them and so it's hard to say where that will take out what we won't continue to do is.
Cash flow twice, our double our earnings right at some point, we will cash on average over a multi year period, we're going to cash flow our earnings no more no less so I don't know its fantastic news right think about the position you're in when your customers pay you massive amounts early.
<unk>.
Bye.
And it's really hard to do we thought we might start to see some of that slide this quarter. So we booked new orders and guys were ahead on their billing. So I don't really have a lot of faith in our ability to guess, which quarter will see some of that turnaround because frankly, our guys keeps surprising us and doing better than we thought.
Hopefully that keeps happening in bell, but.
Understood.
I guess just on.
Modular.
Could you talk about maybe the dialogue, you're having with key customers or new customers now that you've got <unk>.
Additional square footage in place still seems to be.
Some some folks that wonder if data center customer spending near term.
<unk> has just curious any any.
So you could add to that.
So we are doing everything we can to meet the needs of a very large and very loyal customer that we feel like we've really.
Have a great relationship with and we have done.
Our best really to serve we have another similar large hyperscale data center customer.
Given us some.
Notable amounts of work over a 100 million as they try to sort of learned about our capabilities and there is certainly additional work for that customer.
We're already looking at on a very collaborative basis.
Really at this moment.
We couldnt sell as much of that stuff is we can build.
As you know we're in the midst of doubling our capacity.
We're not going to decide to go double it again or pad until we've successfully really done that but so far as you can see from our numbers. So good right.
In both of those spaces, one we're doing substantial work.
In that space and the other we're just beginning to build basis.
The first thing, we're going to do with <unk>.
Really get deployed into the new spaces and get the robotics and stuff in his brain people over from other facilities and let them work during the day right now we're running in some places two and a half shifts and it is not sustainable. So what you can't do is say well youre doubling your square footage that you're going to double your revenue some of that some.
A big part of that increase has already happened because we have to meet our customers' needs and we're working those extra shifts and overtime.
We hope to just keep getting better keep finding new ways to automate things.
Understood. Okay. Thank you guys.
Thanks, Brett.
Thank you one moment please.
Our next question comes from the line of.
Julio.
Okay.
Romero of Sidoti Your line is open.
Thanks, Hey, good morning, guys.
Good morning Julio.
Hey, good morning.
<unk>.
Maybe thinking about the mechanical segment.
I wanted to kind of dig into a little bit more about what's driving that step up in margin.
Because both sequentially and year over year, it's it's really impressive so maybe if you could just dig into.
Op leverage pricing execution, if there was maybe one factor that's kind of leaving the others Kimberly the mechanical segment.
Yes so.
As you can imagine when you're over 20% and it's all of the above right.
Good mix of work.
Work, we're really good at doing.
Margins are good and the work and we're planning and executing but at the end of the day.
It's going to come down to how well we perform in the field.
And then just performing at a very high level. We don't have if you noticed one time, we don't have any we have an absence of significant bad news.
That really does help you.
But also we had a really strong is it 40% increase in service revenue.
We had a very strong.
Service third quarter.
As you know the heat was tremendous.
Folks are working night and day to satisfy our customers' needs both.
Callout work small project et cetera, the margins are higher in service.
That really helps us as well so we've got good balance good execution, good work mix and in.
And the work that we're good at.
Another interesting factor you may recall, a year ago, we were saying we're very early in a lot of our work because we were coming out of Covid. So there was more work starting.
Now, we really have a nice like cadence of business. We have we look at you look at our top 100 or 200 jobs out of our 10000 or so that are currently on our POC.
The big ones Theres lots of 80% complete and they're in the 65 90, whereas a year ago, you were seeing a lot of sub 50, and really low actually it's jobs beginning when you get up to 70 to 80 90. If you are really performing well you start to get comfortable releasing contingency.
So as part of it is just we're getting to a more normalized.
And we're just as exactly what we were hoping for crossing our fingers for these guys are doing it.
Really helpful. And then my second question is just on the revenue.
You mentioned the same same.
Same store sales growth for.
The fourth quarter expected in the mid teens.
So I guess that implies like a full year.
Same store sales around 22% or so just.
Considering that I guess, how do we think about how should we think about revenue comps for 2020 for considering the backlog and the growth momentum, but also some of the pass through costs that may moderate.
So we're in budgeting season, now literally we're literally going out and getting our field of view on that.
The comparables get tougher and tougher half of the growth until this quarter.
Was inflation, we don't expect net inflation growth rate, we don't expect inflation to reverse currently but we don't expect it to be a big 10% per share.
So I just don't see how are we continue to have same store revenue growth of 20% next year.
One thing I'll say is we really didnt expected this quarter.
We do have a $1 billion more backlog than we had a year ago. So it's going to be pretty hard for us to not at least I think we're going to have double digit growth quite honestly. We're just we're figuring that out right. Now. This business is business you go out and earn it and you do it every quarter and every day.
Yes that makes sense and what was the inflation portion of the third quarter sales growth.
Almost 93, 4%.
I would say.
We estimate about what it was.
For the U S economy.
But a lot to add.
Ali.
Okay very helpful. I'll pass it on thanks very much.
Thank you thanks.
Thank you one moment please.
Our next question comes from the line of Josh Chan of UBS. Your line is open.
Hi, Good morning, Brian Bill Congrats on a really good quarter.
Thank you.
Yeah, I was thinking about the organic growth if it's only three or four points of that was price could you just kind of talk about how much of the remaining growth is from used successfully hiring more workers.
Or kind of improving productivity within your construction process kind of how that breaks down to contribute to the really strong growth.
Yes.
A combination of both we did hire more folks I mean, we're a good place to work people want to come and work here.
So we had good luck with that but we also had.
Productivity improvements.
The use of pre fabrication continues to accelerate been modeling, which is which is really accelerating.
Rapid rates all this stuff is really helping us out in the field automation on the welding front et cetera. So it's a combination of hiring more folks.
And clearly improved productivity and just really trying to support the folks in the field to make the work as easy as we can for them.
Job site, that's Crazy I mean also we worked a ton of overtime and service right.
That's a point or two and then you've got like.
We got two points, we went from 18, 1% gross profit to 21% gross profit that's revenue right. The difference between those two is recognized revenue.
So this was just a fantastic quarter.
All of the above.
We just got to hand, it to the guys.
Right right Yeah. It was definitely a really good quarter.
Was wondering if you can talk about the.
The environment for new projects I guess for a while now there's been more work than you and the industry can handle or is it still the case now what verticals are you seeing the.
New projects kind of starting to get get bid out here.
So I mean.
The opportunity is still very strong its broad based.
Coast to coast, the industrial sectors, we talked about.
Paired remarks is still very very strong.
Sure.
Data pharma food.
Battery et cetera, So we have not seen a let up.
<unk>.
As we also said we just got to make sure we stay prudent taken the work we're good at doing over extend ourselves and make sure we continued.
You do good work for our customers so.
So far we're in we're in a really good spot right now.
Great. Thank you for the color and thank you for your time.
Thank you.
Thank you one moment please.
Our next question comes from the line of.
Adam Palmer of Thompson Davis Your line is open.
Hey, good morning, guys congrats on the great quarter.
Hey, Thanks, Adam can.
Can you talk about modular for.
A little bit longer because im curious that the contract you signed in December.
Are you shipping on that now and then if so what has been the early experience with margins and productivity because I think that was supposed to start with kind of a low productivity and ramp up.
Yeah. So just so you know what was booked in a 10 day period in December was numerous purchase orders. So they range from $20 million to $40 million per individual units. They were just all sent over in a batch to get us to.
Help us feel comfortable signing those leases.
Some of those have already they're already on tracks very small part of them are on track with a ton of that is already being built that's why we're working to five shares.
And we've received some new orders.
It is going better than we could have hoped right look at our numbers right.
So far knock on wood I don't notes.
Great for some new orders versus the ones in December.
So we've gotten more into orders otherwise you would have seen our backlog dropped by even more right.
The second quarter and that adds up in the third quarter, which shows that you Couldnt really you couldnt be getting zero orders and modular and hope to have a sequential increase and by the way those come in lumpy I mean people should not worry.
About our sequential backlog change unless it's unless we're telling you to worry about it its.
There's going to be if we didn't have some quarters, where we had sequential down.
We would spin out of control and go out of business I mean people that would love to see that but right now what we're telling you is we're turning away where youre going to see I.
I think youre going to see in the overall construction market at some point in the next year or two.
Maybe little less stuff is being built in a lot of people are projecting when that happens it is going to be because of the capacity to build it isn't there it's not going to be because suddenly people are kind.
Kind of what AI or chips or food or because of the baby boomers stopped getting older.
So theres such a capacity constraint.
Right now the governors.
Or are the ability to do it and obviously that puts us in a pretty pretty good place right because no represent.
Lot of productive capacity.
Okay, perfect and then.
Actually just a couple of cash flow questions.
I am completely confused on this R&D tax credit I had a negative in my model for the next five quarters from that from the exploration like negative cash pretty large one actually.
So I'll still be baking that in.
So here I'm going to tell you.
<unk> got even crazier this quarter, so the IRS released a.
And interpretation, where they said hey.
We've got this stuff going on where you cannot recognize certain expenses.
Listen I'm not we'll get you on the phone with our tax guidance, but they came out and they said that but you don't need to recognize the revenue related to those expenses. This year. It's a one year change on a five year problem suddenly we didn't need to make a tax payment in the third quarter.
It's really complicated and.
We just need Congress to pass that extender. It is going to put a lot of little companies out of business if they don't.
And we need things to go back to normal, but youre absolutely good cash we expected to make probably it.
30, or $40 million tax payment and we literally we'd already I think we'd actually literally already a pre IDE already approved the payback and then sort of interpretation came out which I think might have been the IRS trying to get at least a little bit of relief to the people who are.
No.
Good being put out of business by Congress's failure to be.
Rational.
But so we didn't pay our.
We didn't have to make that third quarter payment right now as things stand based on the interpretations that are being agreed by all the new rules. We don't think will make a tax payment in the fourth quarter, but then we'll be back if they don't fix the extender will be back to big tax payments next year.
Because that was like a this year interpretation and if that confused you.
It is so much more confusing.
Got it.
Excel spreadsheet.
It's insane.
By the way there like there was a.
Wall Street Journal article within the last week that was.
Bring you up to about a year ago up to date to about the problems that are for about a year ago.
But they didn't it didn't even touch on the stuff that's happened in the last couple of weeks at summit.
Sure.
Yes.
That $30 to $40 million payment would that have been for a full year are you expecting that every quarter.
That would've been a third quarter payment and the way the payments work through the course of the year.
Make them sort of 45 days in a rear so it really wasn't yes.
It would've.
<unk> been a big payment, but that's not the amount we would pay every quarter on our current earnings.
But thats why the third quarter payment what it looked like if we didn't have to make it by even 20 or 30 honestly I don't know.
Okay, Alright, well, that's fine and then.
Lastly, what does the capex.
Drop two once.
The new facility builds roll off.
I would say it goes down by a third it doesn't go back down to half. So we were we were in the $30 million range, we're jumping up to the $60 million range I think we'll go back to like 40.
If I had to gas now signed lease for more space, which is not inconceivable that as a discrete event where one.
What are the spaces, we're building out the space everybody got it North Carolina has we're installing 24 overhead track track Craves life.
<unk> cost 7 million Bucks, we have to have them.
They make.
They're worth it they are fantastic the robots, we put in that cost there.
They are big they take a minute to take us a minute to walk past them. So.
So, we're making we're making but the paybacks on these are like one year.
So I don't know hopefully, we'll ask you pay attention and look forward data center demand or like what's going on in that market and I know youre getting orders hand over fist, but.
Are you or what the market's done so.
One not just are we paying attention our guys are literally in some of the meetings inside some of the big they're called out to California.
Net.
And planning meetings and.
Yes, So we got guys our guys in our electrical stuff in Texas that are very very tightly connected as you might imagine if you were at.
Hyperscale data center person.
You'd have a big incentive to be talking to us as you make decisions.
Decided what so.
We're incredibly and connect contact with those people.
I know, what's going to happen what they believe is going to happen is build build build build build.
Sounds great. Thanks, guys have a good weekend.
Adam tickets.
Thank you.
Please.
Our next question comes from the line of Eric Crown of Ritchie Capital Group. Your line is open.
Thank you and good morning, and thank you for taking my questions guys.
Yes, good morning.
I guess just one on my end really.
Could you provide just love to hear some commentary around the quality of the backlog in its current state.
During a potential economic slowdown that you guys get.
Just to expand on that given the current customer and project mix that you guys had should we think about the probability of cancel orders or slowed down any differently than kind of our historical cadence for the company during the downturn.
So here's the thing.
Given time between 80 and 90% of our backlog is work that is already in progress. So it's the cost we don't put something into backlog until after we have a price and a scope and a commitment and that almost always happens. After the building is already started because somebody. So so we have had very very few cancer.
Relations over the last 25 years.
Until Covid, we had only had one cancellation over $20 million something that went into our backlog. It came out during COVID-19, we had 60 or $70 million that we took out of backlog because they were the <unk>.
Middle of work some stuff was put on hold with no Recommencement date, all of that work has come back and been finished so.
Our definition of back so strict.
We rarely rarely people just don't have build a building and stock very much in the U S. Most places it's illegal to do that so our backlog is very firmly committed.
Historically is it possible that something yes, the thing that really when youre exposed to.
Certain clients, it's possible they say stop step for a period of time, if anybody says stop stuff. If they don't have to recommence date, we take it out of backlog because we have a super strict definition of backlog, we just always have.
Right.
That's great.
Quality of our backlog has never been better it's astoundingly. Good it's really good it's work.
Yes, it's astoundingly good it's never been better.
That's extremely helpful.
Yes that makes a lot of sense thats less of a concern of cancellations or postponements or anything more just a slowdown.
Things being brought into the backlog.
I guess from that aspect is there any kind of customer types that you would flag.
Yes.
Maybe on the top the list if there was a slowdown maybe work on their end, but slow down a little bit as well.
So so commercial 100% be the one that you would worry about right now, especially office building.
We only we only only less than 20% of our revenue right now is commercial and it's almost self service. So we just happened not to play in that market and the markets that are important for us.
I think you know.
I would say in the backlog there is no no real.
Discernible risk in the pipeline stuff that we consider very high potential what could happen is people could figure out AI is not real or the chip stuff could be.
Get bogged down in.
I don't know.
It would be sort of or by the way. The biggest risks if you look back in the last 20 years, the two times we hit it.
A big.
Delay a big Air pocket would have been 911, and I guess, that's more than 20 years ago, and then the financial crisis when the financial crisis first hit there were some serious delays on jobs, although even then we were profitable right through it.
Sure.
Okay I appreciate the commentary guys and congrats on a great quarter.
Yes. Good question. Thank you.
Thank you.
I'm showing no further questions at this time with turn the call back over to Brian Lane CEO for any closing remarks.
Okay. Thanks, everyone for your interest in comfort systems, I really want to once again, thank our amazing employees fantastic fantastic job.
Hope everyone has a wonderful upcoming holiday season stay safe and we look forward to seeing everyone and have a great weekend. Thank you. Thank you ladies and gentlemen. This does conclude today's conference. Thank you all participating you may now disconnect have a great day.
Okay.
[music].
Yeah.