Welcome to the MasTec's First Quarter 2020 Earnings Conference Call, initially broadcast on May 1st, 2020. Let me remind participants that today's call is being recorded. At this time, I would like to turn the conference over to Marc Lewis, MasTec's Vice President of Investor Relations. Marc?

Thanks, Ian, and good morning, everyone. Welcome to MasTec's first quarter call. The following statements made pursuant to the safe harbor for forward-looking statements described in the Private Securities Litigation Reform Act of 1995. In these communication, we may make certain statements that are forward-looking, such as statements regarding MasTec' future results, plans and anticipated trends in the industries where we operate. These forward-looking statements are the company's expectations on the day of initial broadcast of this conference call, and the company does not undertake to update these expectations based on subsequent events or knowledge. Various risks, uncertainties and assumptions are detailed in our press releases and filings with the SEC. Should one or more of these risks or uncertainties materialize or should any of our underlying assumptions prove incorrect, actual results may differ significantly from results expressed or implied in these communications. In today's remarks by management, we will be discussing adjusted financial metrics as discussed and reconciled in yesterday's press release and supporting schedules. In addition, we may use certain non-GAAP financial measures in this conference call. A reconciliation of any non-GAAP financial measures not reconciled in these comments to the most comparable GAAP financial measure can be found in our earnings release, our 10-K or in the posted PowerPoint presentations located in Investors and News sections of our Web site located at mastec.com. With us today, we have Jose Mas, our Chief Executive Officer and George Pita, our Executive Vice President and Chief Financial Officer. The format of the call will be opening remarks by Jose, followed by a financial review from George. These discussions will then be followed by Q&A period, and we expect the call to last about an hour. We had another great quarter and a lot of things to talk about today, so I'll go ahead and turn it over to Jose. Jose?

Thanks, Marc. Good morning. And welcome to MasTec's 2020 first quarter call. I hope and pray that everyone’s family is healthy and safe. We are truly in challenging and unprecedented times. Just a few months ago, on February 28, we’ve reported a record 2019 results, combined with record guidance. While the COVID-19 virus came up during our year-end call, little did we know that a few weeks later, much of the country would be shutdown and quarantined. During this time, the safety of our team members has been our top priority. I have to say, I am so proud of the men and women of MasTec. Their sacrifices, resilience, creativity and commitment have been inspiring. Millions of families throughout the U.S. rely on the power, communications, entertainment and other services, we help our customers provide. Our team has delivered and I’d like the men and women of MasTec for their sacrifices and hard work. First to recap of our first quarter. Revenue for the quarter was $1,417 million, adjusted EBITDA was $118 million, adjusted earnings per share were $0.60, cash flow from operations was $203 million and backlog at quarter end was $8.3 billion. A new record level. We had a solid first quarter exceeding our previous financial guidance for revenue, EBITDA and EPS. It's important to keep in mind that most of our services have been deemed essential under state and local pandemic mitigation orders and all of our businesses segments have continue to operate. While there were some disruption to the last couple of weeks of the quarter, March was an excellent month. As we think about the balance of the year, we felt we have enough visibility to provide guidance. Again, since most of our work is ongoing, the biggest risk to our guidance are around governmental…

Thanks, Jose. Good morning everyone. Today, I'll cover first quarter 2020 results. Our current guidance expectations for the balance of 2020, including potential impacts of the COVID-19 pandemic, as well as our strong cash flow profile, capital structure and liquidity. As Marc indicated at the beginning of our call, our discussion of financial results and guidance will include non-GAAP adjusted earnings and adjusted EBITDA. Reconciliation and details of non-GAAP measures can be found in our press release, on our website, or in our SEC filings. In summary, our first quarter 2020 results were better than expected with adjusted EBITDA exceeding our expectation by $10 million and adjusted diluted earnings exceeding our expectation by $0.12 per share. We also generated record cash flow from operations during the quarter of $203 million, a $250 million increase over the same period last year. This strong cash flow allowed us to invest approximately $119 million in opportunistic share repurchases, totaling approximately 5% of our outstanding share base, while still decreasing our overall net debt level on a sequential basis. I will make further remarks on our capital structure later. But suffice it to say that our cash flow, capital structure and liquidity are in excellent shape. And this combination affords us a strong advantage as we navigate through the uncertain economic climate resulting from the COVID-19 pandemic. And lastly, our first quarter 2020 backlog grew significantly both sequentially and over the same period last year to a new record level of $8.3 billion. This includes record level power generation industrial segment backlog, as well as a strong sequential increase in oil and gas segment backlog. Now, I will cover highlights regarding our first quarter segment results and guidance expectations for the balance of 2020. As expected and previously communicated first quarter 2020 oil and…

[Operator Instructions] And we'll take our first question from Brent Thielman of D. A. Davidson.

Great, thank you. On communication, appreciate the color on some of the delays and permitting and the COVID disruptions in terms of what that has on near term growth rates. But just given carrier plan, the stress on the networks, dialogue with those customers, can you talk about how you think of these backlog and bookings could trend as we move through the year and start to think about some potential normalcy later this year and into 2021?

Sure, good morning, Brett. So, a couple things first, I think that the all the long-term thesis in that business hasn't changed one bit. If you think about the early response to COVID, I think most carriers, especially the ones that have wireline networks have really been focused on making sure that their customers have internet and high speed availability to homes right and improving that. There are a lot of people that are either watching video over the top and quite frankly, there are a lot of people that are using their home WiFi networks, through their phones, so people get their phones, they connect to their WiFi systems at home. So, a lot of the cellular traffic's actually going through WiFi systems today. And just anecdotally, what I'm hearing is that the wireless network traffic is actually down because so many people are in their homes using the WiFi network. So it's kind of interesting, because that's where really the priority for a lot of the carriers and our customers has been over the course of the last couple months. That's going to change as people come out, and the wireless networks get tax and I think that the carriers in general are expecting there to be a pretty rapid swing the other way on that and it's going to be interesting to see how the networks fare. I think overall to date the networks have fared extremely well. With as it relates to COVID. The biggest issues for us have been permitting. And if you think about the types of jobs that we do, they're relatively small; they're relative-- you're on a work order basis. So even though jobs may be either broken up in little pieces, and each of those pieces requires a number of different…

Okay, all right, fair enough. And then again, on oil and gas, it's good to hear the commitments to capacity. Has all of this change customers approach to kind of pricing or terms condition? Do you still feel pretty good this tight market can support your kind of generally elevated margins for the foreseeable future.

We do. We think it's been a competitive market for a long time - we're not the only player in that space, so I think, I think we're a low-cost provider which is really important. And with that we've been able to generate really good margins based on the things that we've done in that business over the course of the last few years to really prepare ourselves for what we knew is going to be a very active market. So, I think structurally our cost structure is very different than those of our competitors, which puts us in a in a very enviable position especially as the market gets a little bit tighter. So, we feel really good about our margin profile and our ability to continue executing on that margin profile. The business will be a little bit different and with that again comes a lot of opportunities. So we're excited to work, the work that we've got, we’re again we're in a great position from a backlog perspective, but I also think we're in a great position relative to customer relationships and just understanding what the customers needs are. And our ability to be able to fill that and really and meet the demands.

Thank you, and we can now move to our next question, it comes from Alex Rygiel, B. Riley, please go ahead.

Good morning guys, nice quarter. The oil and gas backlog increased nicely, can you talk a little bit about sort of what types of projects and what the timeline of those new projects looks like from that recent increase in oil and gas backlog over the last three months. And then can you touch upon your thoughts on the Keystone energy pipeline opportunity ahead of you?

Yes. So from an oil and gas perspective last quarter, I think we kind of gave a lot of - we kind of talked about this and it kind of played out as we expected, so on our last call we talked about having about a $1.4 billion projects that we expected to make it into backlog in the quarter, if you look at the way it played out it was about a $1 billion in that $1.4 billion. There are still a number of other projects where we feel we've got a verbal award and the contract just one signed in time for it to hit first quarter backlog. So, we still have considerable amounts of other work that we feel really good about that's not in the backlog number as of the end of the quarter, which we also think is a positive step. We also walked through at the end of the year, our project sequent through the year and then really when we expected those projects to start and how they were going to play in, some of they came to fruition right up, we've had, we've got about four projects that we talked about, it all started on time, we have two that were accelerated actually from Q2 into Q1 that started in late Q1. We've had a couple that have slipped a few months based on schedule and permitting, so and then we've got a couple that are right on schedule. So, we feel really good about where we started the year, where we thought we were going to be and how it's playing out. We're definitely backend loaded; we've been backend loaded since we've been talking about this since probably the third or fourth quarter last year, that was our expectation going into…

Then turning to Telecom backlog was down a little bit, can you explain why and then could you quantify how your revenue associated with 5G today and what that could look like in say a year or two?

Yes, a couple of things, George talked about it in his prepared remarks, if you look at year-over-year backlog trends, the entire drop in backlog came from a new assessment on our install business. So Covid had a big impact on our install business, a lot of that is MSA driven so we re-evaluated where we are there, we've dropped it about $350 million on a year-over-year basis. And that's really the significant drop to backlog, which I think puts us in a really good place, as we start modeling out and as we start having comparables on a go-forward basis, so that has a lot to do with the drop in backlog. As it relates to 5G, I think every carrier is different, right? So, we've got four primary carriers today, if we include DISH, Verizon and AT&T have been on cadence that is it's obviously going to ramp and continue to ramp as we go into 2021. You've got T-Mobile, Sprint, that acquisition just closed, that I would say from all intents and purposes is somewhat behind schedule, right, they closed and then they got caught up in Covid. We're very bullish on what that means for us over the long term, but it's going to play out, it's going to take a little bit more time than I think anybody would have hoped, and then you've got DISH under the same circumstance, right. They've got a lot to do, they were a big beneficiary of that merger as well, with what they've got, they've got significant plans but, again, I think Covid has kind of slowed that down. So we've said all along that we think with all the other carriers, be it, Verizon, T-Mobile, or DISH, they're big opportunities for us, there's no reason why we shouldn't be doing significantly more revenue for all those, there's significant opportunity than within AT&T. So we hope that our Wireless 5G type revenues, associated with all those guys, significantly increases over the course of the next couple years, we would hope to see it be multiples of what it is today. We think that's the level and size of opportunity and it's our job to go execute on that.

Thank you very much. Good luck.

Yes. And maybe to add to that, Alex, one final thing, I do think it was nice to see Verizon as our second largest customer, it was the first time they made it there. And I think that's also an important look at the quarter and a nice to have during our first quarter.

Thank you. We’ll now move to our next question that comes from Blake Hirschman of Stephens Investment Bank.

Yes, good morning guys, you sound healthy, so that's good. Let's assume that oil prices don't go up from here, how long before that would start to impact the oil and gas piece of the business? And then kind of along with that, what's your mix in terms of like maintenance or integrity pipeline work, versus like new large pipe construction work?

Yes. So a couple things, Blake, when we think about oil prices we're looking at a very specific point in time, most people around the world, they're at home, oil demand has plummeted, when people get back to work oil demand will increase. I don't think there's any question about it, and the questions are all around how much will production drop across the world, and how quickly will it take demand to catch up to those levels? And I think we could argue all day about what the right answer to that is, and I think nobody really knows. I probably, personally, have a more favorable view, that that's going to catch up quicker than I think what most people thinks. So, I think that over the course of the next year we're going to see a recovery to oil price, I don't think you're going to see oil prices stay where they're at for a long period of time. With that said, right, and we highlighted in our remarks, I think it's important only 6% of our work, over the last 3 years, has been attributable to oil pipelines. There's a whole other play here which I think is going to be interesting and, again, I don't necessarily know how it's going to play out. But with all of these -- with all of the oil production comes a significant amount of gas that comes out of these same wells, right. So, there's been an overabundance of natural gas for a long time for the last couple years in this country, a lot of that had to do with the amount of drilling that was happening. As that goes away, I think we're going to see a pretty significant price increase on gas because they're just going to…

And we can now move to our next question. This comes from Noelle Dilts of Stifel, please go ahead.

Hi, guys, good morning and congratulations on managing through all of this uncertainty well. So, I think both of my questions kind of focus a little bit more on the telecom side. First, when you’re looking at some of these permitting challenges, I’m curious how the degree to which you are seeing that and wireless versus wireline, I think AT&T topped the bit about facing some of those challenges on its conference call while Verizon was a bit more positive on that front. So kind of curious how to think about that by those processes markets?

So, it kind of depends on the work function, all right. So, if you think about there are certain types of work where it’s less important, and there’s certain types of work that you can work on blanket permits, which really alleviates a lot of these concerns. I think, specifically, as it relates to wireless, when you think about small cells, and the fact that small cells are being installed in heavily trafficked corridors, be it downtowns, be it major streets, that’s where the issues arise, right, where you might have cities and municipalities that don’t want work happening in a particular area because of what’s happening with the pandemic. Or you need special permitting not just from a city of municipality, but from the Department of Transportation, the state one, maybe some other state permits, that’s where it complicates a little bit more. So, there are functions of the work where I think it’s very minimally impact, and then there are other functions where I think it’s more important. On the underground side, it’s a little bit more intrusive, right? So, you have more, I think there it’s a little bit more difficult. And as you see the dependence of some of the new wireless and 5G build out with fibre, it kind of intercedes a little bit, right? So, it’s a tough question to answer because there’s a lot of intertwining stuff that happens, but albeit to say, there’s portions of the business that aren’t impacted, and there’s portions of the business that are more impacted, and it’s our job to manage through that. And I think everybody understands the pace at which they want to go. I don’t think the cities and municipalities are against it, they just have a lot of things to manage right now, and it’s our job to get it up, in terms of their level of importance.

Okay. And then, obviously, last year we talked about you guys ramping up capacity in telecom and in anticipation of 5G related spending picking up. So, given some of the delays this year how are you thinking about capacity utilization? And are you basically holding on to hope in anticipation of that ramp? And how do we think about the underutilization development this year?

Yes. So, it’s a great question. One of the things that we try to do as a company is, these are very uncertain times for everybody, but I think for those people that are in the frontlines, that are depending on a weekly paycheck, it’s probably even more important for them. So, we’ve done everything possible to not furlough employees and to make sure that everybody’s taken care of at MasTec. At the end of the day, we really view this as a family-owned business, and that’s how it kind of started, and we’ve always tried to keep those fundamentals in place. So we’ve tried to take care of our employees to the best of our ability, even if it’s meant underutilization, there’s no question us having some impact to our margin. We spend a lot of money gearing up and really preparing and investing in our people, so we’re not going to give up on that investment. So, there’s no question, there’s a little bit of underutilization, especially in those markets that are either complete shutdowns or where you have limited availability to work. We’re working through that, we think at the end of the day it’s what our company’s about and it’s why our employees are extremely loyal to us. So, having an impact, I think the impacts going to subside as the quarters’ year come and go. So, it’s, if we think about the year, if you listen to our prepared remarks we expects improvements in margins in our communications business probably a little bit less than what we did coming into the year, and there’s no question that that had some impact on.

Thank you. We'll now move to our next question. This comes from Jamie Cook with Credit Suisse.

Hi, good morning. Nice quarter. Glad to hear everyone's safe and well. I guess my first question, Jose, if we look at the oil and gas backlogs in the $2.6 billion or so in the quarter, Can you remind investors what sort of big pipe versus integrity or other less cyclical businesses and just sort of the opportunities to grow the business outside of big pipeline, which is just the margin profile between the two. So, the non -- the other parts of the business became a bigger part of your portfolio what that would do the margins. And then I guess my second question on the big pipe side, well, we look at the CapEx numbers and they look scary. I guess I would say, MasTec is one of the players left that are probably still healthier or financially capable. I'm just wondering what you're seeing from your competitor base. It's going less healthy and so even in a declining CapEx market, MasTec just continues to get a bigger portion of the overall market? Thank you.

Yes. So Jamie, one of the nice things about the backlog that we've been able to book, not just this quarter, but I think over the last couple quarters, it's not driven by any single project, right, a few years back, single projects, we're having a huge sway on our backlog, right. So, we were having projects that were north of a billion dollars, and that was impacting our backlog in a pretty sizable way. We're not seeing that, right. We're, we've had a lot more jobs that are making up our backlog than we've historically had. It's a nice mix between all types of jobs, which again, is important. I think when you look at total CapEx dollars for our customers, you kind of got to break it down into all the different buckets, they invest in a lot of different things, not just pipelines, even the big pipeline operators have a lot of investments outside of pipelines, so you almost have to break it down into what they're thinking, a lot of the guidance that's been put out for '21 and '22, although it's very early. The directional guidance that a lot of these pipeline companies have given are strictly for approved projects. And again, we're in a very unique time where the market is has taken a significant downturn. As that market improves, we're very confident that other projects are going to make it onto their list because they're economically viable. And I already think we've seen some of it right, some of our customers stock have been significantly impacted and deteriorated. A lot of those have significantly improved in the last couple of weeks. And I think that in and of itself, is we're already seeing some more confidence from our customers relative to they feel better about their stock price, they feel better about the business longer term. And I think over time that's going to show. So, I think you're also right about the comments of where we stand in the industry. There are a handful of larger players that are going to be fine. There's a lot of smaller players won't be around, and ultimately, that's that takes away capacity and it gives us a better opportunity. The reality is that the customer mix that we're always trying to work for isn't necessarily working with a lot of those smaller players and a lot of the companies that will ultimately fail or even from a customer basis companies that will make it are usually using contractors that are a lot smaller. So, as the business consolidates with the bigger players, from our customer's perspective, that's also good for MasTec.

Thank you. Now move to our next question. This comes from Andy Lee of Citi.

Good morning. Thanks, guys. So, my first question is on the communications margin. So, margin has been relatively sticky at roughly 8% range and you are expecting an uptick there going forward. So, is the improvement really just higher revenue or is it better mix of project work? And do you have any concern how social distancing measures might negatively impact that?

Yes, so I think a lot of it, and we've talked about it over the course of the last year has been just are gearing up for the demand that we know is coming, right. So, a couple questions ago, we talked about utilization, there's no question that utilization levels aren't where they can ultimately be. And I think we're going to -- and that is a function of just having more work and putting people on jobs. Everything that's happened in the last month or so has impacted that, right? Because you just you have, it's just everything's become a little bit harder, right. So, as things normalize, we think that's going to, we think we're going to start making and continue to make improvements to those utilization levels. If you again, in our prepared remarks we talked about there being a margin improvement on a year-over-year basis overall, or at least 100 basis points for on a full year basis. We still expect that right and that's a lot better than -- as better it's not exactly where we wanted it to be, we think that that number continues to increase. And as hopefully when we look at 2021, and a full year basis, that number increases significantly more than that. So, we feel really good, where we are, where we're positioned. Again, we've been, we've been building our resource base based on the work that we think is coming something very similar to what we did in the oil and gas business a few years ago. And I think as you saw, the margins came and followed on that. And we've talked a lot about the similarities between that and our communications business; we still expect it to be the fact and the case. But obviously, we need to; we need all the players in the industry to be up and running. And I think we're getting really close to that.

Okay, thanks. And then on my follow up is on the electric transmission projects. So, if backlog has been bouncing around a little bit and in the current environment, there are some concerns that utility could have lower CapEx. So, are you seeing incremental projects in that segment?

Yes, we're seeing a, there's a huge pent-up demand. Actually there are a lot of projects that are currently in the bid cycle. Some bids have been delayed because of the, you've got people that are just at home. And so we've seen a number of bids that we thought would come out in this period that are now being delayed a month or two. Not huge delays. But obviously, we think there's going to be a huge pent-up demand and when everything opens up, there's going to be a lot of bids that are going to be coming out at the same time. There's a lot of work in that industry. I don't -- I think the all the -- all those fundamentals for the industry are really solid. If you think about storm, just system hardening for storms, fires and everything as that's not going away. You've got the renewable aspect with other renewables that are being built that require a significant build out. You got reliability issues, so I don't, I think it's a very strong market and one that I don't think we're going to see any change to the investment profile market in anytime soon.

Thank you. We can move to our next question. This comes from Andrew Whitman of Baird.

Yes. Great. Thanks. I wanted to ask a couple more questions here on the pipeline oil and gas segments here. And specifically just thinking about the fact that that you are expecting the work to ramp in the second half of the year with so many changes, things changing in the customer side. I guess I want to understand how much or what percentage or how you're thinking about the level of fully permitted and fully authorized to proceed jobs that you are making on here in the second half of the year. If you could just talk about that. I think that would helpful?

Sure, Andy. We've got a couple of jobs slated to start late in the second quarter. We've actually mobilized on a number of them already. So, we're doing very early work. It's not a lot of people. But it's obviously a great indicator as to when these projects are going to start. So, again, a lot of this has to do with just permitting in time and a lot of that's been right to schedule. So, we feel really good about the start dates that we've got planned. I think we've been conservative around what we think the productivity on those jobs is going to be for the balance of the year. So, we built some room in there in case there are some slips, but we feel really good across our different jobs of when the start dates are, where we're headed to what's required to start on. And again, it's not inconceivable that one could slip a month or two, but we're, we feel really good about where we are and how we kind of model that out.

Yes, you just mentioned the productivity kind of second time; you've referred to that you mentioned that maybe some of the social distancing requirements are going to make some of these jobs, run out take a little bit longer. That sounds like it also could mean that they're more expensive. I was wondering how this factors into the margins that you expect to realize off of these jobs? Or if you're starting to price this in on jobs where the RFP is in your hands, and it's coming back?

Yes, so I think, I think we've alluded to it on the call as well, right? Our jobs are a mix of project, whether it's unit cost or fixed price, and then cost plus right so on the cost plus jobs, they tend to have a little bit less of a margin than the rest of our business. So, as our cost plus jobs ramp up the overall margins of the business, the profile drops a little bit, which is why we go from, being in the 20s to the high teens. And I don't think that any of these issues or social distancing requirements is going to impact the fundamental belief of where our different margin profiles are. So, we still expect the same thing right there will be a larger mix of cost plus in the second half of the year because some of the jobs that we start will be cost plus. So, we'll see a little bit of drop in margin second half the year versus first half. But the fundamental margin profile, the different pieces of work shouldn't be materially different.

Thank you. We'll move to our next question comes from Adam Thalhimer of Thompson Davis.

Hey, good morning, guys. It was a COVID impacted your long-term outlook for telecom at all?

Not at all, right. I think it's interesting. It doesn't change any of the thesis we've been talking about, right. So, our customers are still very committed to the technologies they want to deploy. I think if anything, it's, they want to do it more rapidly, right. I think with everything that we've seen we've seen how important technology is and just about everything we do. Our customers understand that I do think there's going to be opportunities as the -- as our customers look at their business, I think they're going to look at their business different. They're going to look at how the do the things that they do. And I think there's going to be a great opportunity for further outsourcing as they think about their cost structure. So, again, I think they're, the fundamentals are in place, and nothing's changing. But quite frankly, I think there's going to be some really good opportunities that arise because of the lessons learned from this pandemic.

Okay. And then second question on oil and gas that revenue ramp, its gone from like $450 million in revenue in Q2 to well over $1 billion in Q3, logistically speaking, is that daunting at all? Or is that that's just the way these companies are set up to operate?

Well, I think if you look at our historical, right, it's not much different than what we've historically done.

Yes. And that's pretty cut, that typically third quarter is a big period for us. We've done, well north of those amounts over the years. That's on project timing or what not so; second half of this year will certainly be bigger. I think the third and fourth quarter will both be big. I think when you look at it year-over-year, our fourth quarter in 2019 was a little was a little bit muted because we had some delays on prices, we broke early for winter. So, we'll have a bigger growth in the fourth quarter, but they're going to be both very strong in terms of revenue, and that level of revenue is not, it's something that we we've done multiple times over the years.

So, we did about $1.2 billion in the third quarter of '17, Adam, and if you look at our -- it's not really we're expected to do less than that in this third quarter, so it'll still be a significant ramp from Q2, but we don't, we won't have to get to the levels we got to in '17.

Thank you. We'll now move to our next question. This comes from Sean Eastman of KeyBanc Capital Markets.

Thanks, team. Thanks for taking my question. First one for me, I'm just curious as the Sprint T-Mobile and DISH deployment plans start to ramp-up. It seems like there's a couple options, they can do some stuff in house, they could go with these Program Manager type companies or local operators. I'm just curious how you think MTZ's capabilities are being viewed relative to some of those other options. And just how you're thinking about MTZ's addressable scope, as those deployment plans start to firm -up?

Sure, I think today we're the largest wireless contractor in the United States. I think every one of those carriers knows that. I think they understand what our strengths are. I think they understand what we bring to the table. And I think we have tremendous opportunity with all of them.

Okay, and then just higher level of the, clearly, just with this backdrop, the oil and gas exposure is really in focus, arguably a drag on the valuation you guys are getting. So, I'm just curious, if you're spending a lot of your time looking at new growth ventures outside of oil and gas, or whether you just let the numbers speak for themselves with the business mix you have today. And if you're looking at expanding, I'm just curious if it's more new end markets, new geographies, or just capturing more out of the supply chain in your existing end markets like you did with QuadGen. Any thoughts on this business development, what stuff you're thinking about would be really helpful?

Sure. So, I don't think it's changed, right. I think we're always looking at different alternatives for the company and different opportunities. We love the businesses that we're in, quite frankly, and I'll be honest, I love the oil and gas business I think that, we're going to see it is, it generally tends to be a little bit more cyclical because of the commodity prices. I think we've really performed in that business, I think, we've got a great brand in that business offer some great services and product. And I think that's not going to change, right. At some point their market is going to come back irrespective of what we all think. I mean, history repeats itself. And we're going to be super well positioned. So, I know people don't want to give us any value for that business. But the reality is that I think we've built a very valuable asset in that business, that over time is going to perform extremely well. With that said, always looking for ways to improve our business and get into things that maybe we're not in today. I think as a result of this pandemic, all of our customers are going to be looking for ways to cut costs ways to do things differently and in that are going to be a ton of opportunities available to us both in services that we provide today and quite frankly, in new services. When I think about the future of this country, I continue to believe strongly that at some point, we're going to see an infrastructure bill. I think we've been positioning MasTec for years to take advantage of an ultimate infrastructure bill, I think you're going to see that continue and ramp. I do think it's going to come in some way, fashion or form. And I think we're going to be a huge beneficiary of it. Not we're talking about today, because we don't have anything. But as that becomes more clear, we'll talk a lot more about our strategy and what we've done to prepare ourselves. But we're, what do we know, we know that in the next 10 years, MasTec is going to look different than what it does today, right from 2007 to today. We're a very different company and we've been able to grow revenues from just under $900 million to over $7 billion. And over the course of the next 10-years, we hope to be able to do the same thing and grow our revenues significantly and that's going to take our company looking a little bit differently over that time. And quite frankly, that's what we love about our business. The fact that there are so many different things we can be involved with the customer base that we have and with customers that are similar to the ones that we have. So, again, we're very bullish on our future and feel really good about where we're headed as a company.

Thank you. We can now move to our final question. This comes from Steven Fisher of UBS. Thanks.

Thanks. Good morning, guys. So, you did beat expectations for Q1 with when you had about one month left in the quarter? Because I'm curious as we look forward here to Q2 and the 2020 guidance, and to what extent would you characterize these guidance levels as conservative or book to the market conditions that we have now just really make any sort of characterization difficult?

It's a good question. And one that obviously if we debated. I think most companies decided not to give guidance and I think most companies have withdrawn guidance across the universe. And I think a lot of that has to do with, there's still a lot of uncertain times ahead, we have no idea what this pandemic is going to ultimately mean, if it's going to come back what impacts it will have on society in general. So, we felt strong enough that we have enough visibility to be able to provide guidance. And at the end of the day, we thought it was important for our shareholders to get a value and a value of what of what our knowledge is and what we think and where we think we're heading so they can have some visibility into how we see 2020. By giving that visibility, obviously, we didn't want to get ahead of ourselves. So, we wanted to put out numbers that we felt very comfortable with. And I think we built risk into those based on all the unknowns that exist. And I think that speaks to the strength of MasTec. Right, the fact that we have that visibility, the fact that we believed enough in it to be able to put out guidance when so many aren't and put it out with confidence, right? So, there's no question if things go great. And this passes, and there's very little impact to it, then yes, these numbers will probably prove out to be conservative. And if it doesn't, and some things happen, we still feel with high confidence that we'll be able to hit this range. So, that was our thought process behind the guidance. We feel good about it. We hope that and we pray that everything finishes, and there's no more impacts from this and life returns to normal as early as the next few weeks, and we forget about it, but I don't -- I'm not sure that that's the case either. So, I think we tried to come up with somewhere in the middle and again, we feel very good about the numbers that we provided.

Well, kudos for taking a crack at it. In terms of the Power Gen and industrial margins, just I know you talked about in the prepared remarks, some of the factors that are driving some of the volatility there in terms of efficiencies and higher fixed costs, but I guess I'm curious about how to think about this going forward because as you do face some longer term headwinds in your oil and gas business, you do -- it seems like have robust enough revenue business there to make a difference in contributing more meaningful profitability. So how should we think about the volatility in those margins and the quarterly profit rates are swinging pretty dramatically? So what are the prospects for really kind of producing a larger profit base in that segment? Thank you.

Yes. Couple things. First, the business is in hyper growth, right. I mean the growth rates that we've been able to achieve in that business over the last couple of years, I think, have been remarkable. I think if there is any good, as good as any growth rate we've had in any business that we've been involved with as a company. When you look at full year 2020 guidance and really the narrative that we put out, we expect about 150 basis points improvement in that business on year-over-year basis from our margin profile, which is really solid. With that said, as the business gets to normalize growth rates, right, 50% growth rate is significant and that's we've been enjoying that or better. There are inefficiencies in cost that are associated with that. So overtime that business will appreciate from a margin profile. We expect that business to be higher -- in the high single digits in more of the new term in the next couple of years and then we do think there is an opportunity over a longer period of time to be maybe even got to low double digits. We hope to be able to speed that up and make it faster but we think those are realistic targets. We are working on our way into that and again, we are just -- we are thrilled with the pace of the business and we are excited. We know that margins are the issue. When you look at first quarter, first quarter is a tough quarter for us in that business. We got lot of jobs in markets where weather is bad, where there is lot of snow, significantly impacts the margin profile of that business. So it's -- it's generally going to be our weakest quarter. I think you'll see quarter-over-quarter improvements in that business that trend up nicely. We understand what the risks are. We understand what the profile needs to look like and when we think we are on our way. So we are pretty excited about that segment is going to do for us over the long term. End of Q&A

So I think with that this concludes our first quarter 2020 call. We thank you all for participating. And we hope and pray that you'll stay safe and stay healthy. And we look forward to updating you on our next call. Thank you very much.

This concludes today's call. Thank you all for your participation. You may now disconnect.