MasTec, Inc. (NYSE:MTZ) Q1 2023 Earnings Call Transcript

Neil Mehta: And then about how there have been some bottlenecks in the 5G initiatives and some of the other issues that have affected pacing talk about how those bottlenecks are potentially being alleviated? And when do you really feel like that momentum will show up?

Jose Mas: Sure. I think a couple of things. One, there’s no question that the carriers are allocating dollars really where they think they can get the biggest bang for their buck today. There’s a question about how fast speeds do you really need in the wireless area to be competitive in the market. So I don’t — I think 5G has gone much lower than most had expected. I still think we’re at very early stages of 5G deployment. I think customers have obviously spent a considerable amount of money on the wired infrastructure side of wireless. I still think we’re going to continue to see that. I think one of the challenges in small cells have been the need for fiber and power. So I think as that continues to build out we’re going to see an increase there.

So I still think the best years of wireless are yet to come. I think we’re going to see a substantial increase in CapEx over the coming years. But I think what’s driving the business today is on the wired side really and on the deployment of broadband infrastructure across the country. And that’s not a bad place to be right? So we think that again as more fiber gets put into the ground we’re going to see continued investments in 5G wireless technology.

Neil Mehta : Thanks, guys.

Jose Mas : Thanks, Neil.

Operator: Next question will come from Jamie Cook with Credit Suisse. Please go ahead.

Jamie Cook : Hi. Good morning. Nice start and I do appreciate the color on the guidance as well. So I guess two questions. One Jose, if you look at some of the — like if you look at the acquisition that you guys have done now having a larger transmission distribution business with the renewable business given Quanta’s win yesterday of SunZia it proves that that strategy is going to be very successful for the both of you right that you both have — you have a tremendous sort of synergy opportunity across your renewables business and now your larger transmission distribution business. So my question to you is do you — are you bidding on projects right now that are of size that will leverage both that you could win both on the transmission side and both on the renewable side and sort of your comfort level with winning these big transformational jobs given its a new acquisition and some of the challenges that we’re having right now in terms not challenges but you have to integrate the acquisition right?

It’s still early on. So that’s my first question the opportunity and your comfort level. And then my second question gets back to your comments on focusing more on return on invested capital sort of resonated with me. So can you just sort of go a little deeper there? Do you have return on invested capital targets? Will you include that in compensation? Just a little more color on that as well.

Jose Mas: Sure. So on the first piece I think when we look at our customers in the way that they’ve acted over a long period of time many times they look at the renewable assets, they look at the transmission assets. Sometimes those projects are interrelated. But for the most part those jobs were bid separately. So they would bid the renewable jobs to renewable contractors and really the transmission portion of those projects for the most part would be bid separately. I think what you saw from Quanta yesterday what you see from us and the deals that we’ve done is really the opportunity to be able to go into those customers and sell a full turnkey product. And I think that the customers are receiving that well. I think we will absolutely have our opportunities and have our wins related to that.