Good morning, everyone, and welcome to the MYR Group Second Quarter 2013 Earning Results Conference Call. Today's conference is being recorded. At this time, for opening remarks and introductions, I would like to turn the conference over to Mr. Philip Kranz of Dresner. Please go ahead, sir.

Thank you, and good morning, everyone. I'd like to welcome you to the MYR Group conference call to discuss the company's second quarter and first half results for 2013, which were reported yesterday. Joining us on today's call are Bill Koertner, President and Chief Executive Officer; Paul Evans, Vice President and Chief Financial Officer; and Rick Swartz, Senior Vice President and Chief Operating Officer. If you did not receive yesterday's press release, please contact Dresner Corporate Services at (312) 726-3600, and we will send you a copy. Or you can go to www.myrgroup.com where a copy is available under the Investor Relations tab. Also, a replay of today's call will be available until Wednesday, August 14, 2013, at 11:59 PM Eastern Time, by dialing (855) 859-2056 or (404) 537-3406 and entering conference ID 17297213. Before we begin, I want to remind you, this discussion may contain certain forward-looking statements. Any such statements are based upon information available to MYR management as of this date, and MYR assumes no obligation to update any such forward-looking statements. These forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Accordingly, these statements are no guarantee of future performance. These risks and uncertainties are discussed in the company's annual report on Form 10-K for the year ended December 31, 2012, and the company's quarterly report on Form 10-Q for the second quarter and first half of 2013 and in yesterday's press release. Certain non-GAAP financial information will be discussed on the call today. A reconciliation of this non-GAAP information to the most comparable GAAP measure is set forth in yesterday's press release. With that said, let me turn the call over to Bill Koertner.

Good morning, everyone. Welcome to our second quarter and first half 2013 conference call to discuss financial and operational results. I'll start by providing a brief summary of the second quarter results, then turn the call over to Paul Evans, our CFO, for a more detailed financial review. Following Paul's discussion, Rick Swartz, our Chief Operating Officer, will provide an overall industry outlook and discuss what we see as some of MYR's opportunities. I will then conclude with some closing remarks and open up the call for your comments and questions. We are pleased to report another quarter of solid results, including higher contract margin, EBITDA and operating cash flow compared to the second quarter of last year. Our results benefited from solid execution in the field and effective contract administration. Our highly skilled workforce, expensive fleet of equipment, commitment to safety, strong balance sheet and disciplined bidding approach remained the key ingredients to our long-term success. Revenues were $213.9 million for the quarter, which was lower compared to the same period last year, largely due to reductions in subcontractor and material costs from several large projects. Paul will discuss this in more detail later. Gross margins, however, for the second quarter of 2013 increased to 14.6% compared to 11.5% for the second quarter of 2012, an increase of about 310 basis points. Overall, contract margins benefited from improved performance on a few large projects due to higher productivity levels, cost efficiencies, additional work and effective contract management. EBITDA increased to $22.5 million for the second quarter of 2013 compared to $21.8 million for the second quarter of 2012. Over the last 12 months, our return on equity was 15% compared to 12.7% for the prior 12-month period. We believe these results compare favorably to our peer group. Our gross margin for the first half of 2013 was 14.1% compared to 11.2% for the same period in 2012. First half 2013 EBITDA was $40.8 million compared to $37.7 million in the first half of 2012, an increase of 8 -- excuse me, of 8.2%. We also improved year-over-year diluted earnings per share in the first half to $0.76 in 2013 from $0.74 in 2012. Looking forward, we remain very optimistic about our long-term growth prospects in both our T&D and C&I markets. Now Paul will provide details on the second quarter and first half 2013 financial results.

Thank you, Bill, and good morning everyone. Yesterday, we announced our 2013 second quarter and first half results. Our revenues for the second quarter of 2013 was $213.9 million, which represented a $46.5 million decrease compared to the same period in 2012. On a percentage basis, 2013 second quarter revenues decreased 17.9% over the 2012 second quarter. To put this decrease in perspective, second quarter 2012 revenues increased $75.1 million or 40.5% over second quarter 2011 revenues. Material and subcontractor cost comprised approximately 28% of total contract cost in the second quarter of 2013 compared to approximately 47% in the second quarter of 2012. The amount of subcontractor material cost to percentage of overall project cost continues to be highly variable from project to project, depending on the client when the project requirements. From a segment standpoint, and compared to the 2012 second quarter, T&D revenues decreased $41.8 million to $174 million, and C&I revenues decreased $4.7 million to $39.9 million. Focusing on the T&D segment. Revenues were $147.9 million for transmission and $26.1 million for distribution in the second quarter of 2013. This compares to $187 million for transmission and $28.2 million for distribution in the second quarter of 2012. Transmission revenues decreased in the second quarter of 2013 as compared to the second quarter of 2012, even though we worked slightly more man-hours in the second quarter of 2013 than in the same period last year. On a few large transmission projects there was substantially less material being installed and less subcontractor work being done in the second quarter of 2013 than in the same quarter last year, which resulted in less revenue for the quarter. Material and subcontractor cost in our T&D segment comprised approximately 24% of total contract cost than the second quarter of 2013 compared…

Thanks Paul, and good morning, everyone. As our project team remained focus on executing work and managing contracts, our T&D and C&I estimating teams continue to evaluate and price a steady flow of projects that are coming to market. While we continue to see nationwide opportunities in transmission projects of all sizes, bidding activities for large projects has slightly decreased compared to the level we have seen over the past several years. However, we see a potential to increase as we head into 2014. The fundamental drivers for large project development continue to be the need for delivering renewable resources, as well as mitigating rising power cost due to congestion. Although there are significant projects in the planning and development stages, construction starts for these projects are developed to predict. Additionally, we have seen an increase across the cost country in small to medium sized opportunities in transmission, construction and upgrades work. This activity is largely driven by NERC mandate to ensure bulk power systems' reliability and the need to integrate a change in mix of generation sources resulting from the EPA Mercury Air Toxics Standards rulings. All of these drivers point to a promising outlook for MYR Group, with nationwide opportunities in both the immediate and long-term. During our last couple of calls, we highlighted opportunities in the Northwestern, Midwestern and Great Plains region of the U.S. Today, I would like to comment on the outlook for opportunities in the western and southwestern regions. We believe that the Western transmission market has been strong, and anticipate it will increase significantly over the next several years. The long awaited Gateway West project, which include more than 800 miles of new 500 kV and 200 miles of 230 kV transmission, should start coming up for bid next year. We anticipate other…

Thank you for the update, Rick. As Rick and Paul discussed, we are encouraged by the opportunities the future holds for MYR, as we believe several markets are poised for continued growth due to increased needs and requirements. We see no shortage of work going forward, including large transmission projects, which points to a healthy future for MYR for many years to come. As always, our objective is to enhance shareholder value over the long-term. Although, to date, our growth has been completely organic, we continue to explore acquisition opportunities that might enhance shareholder value. As we look at potential acquisitions, it is important that we stay focused and disciplined, just like we do with our bidding, new work and executing projects. MYR and its subsidiaries have a long history of successful project bidding, execution and financial performance while responding to various cycles in the industry. We intend to remain a market leader, and know that do that, we can't take our eye off the ball. Continued improvement and innovation in the areas of safety, quality, productivity, customer service, scheduled assurances and risk-taking are necessary in order to exceed our clients expectations to be considered the employer of choice and attract the very best talent available. That's it for now. On behalf of Paul, Rick and myself and the rest of the management team, I'd like to thank you for joining us today, and as always, thank you for your interest and support. Operator, we're now ready for questions.

[Operator Instructions] Our first question is from Tahira Afzal from KeyBanc.

This is actually Saagar on for Tahira. Speaking of margins, it came in very -- the best margins that we've seen for you guys and your T&D segment, on recent records that we can remember. Were there any positive closeouts or onetime items that hit that? There is a lot of work that you're guys are doing in the CREZ that's winding down, as you guys mentioned. I just want to see if there's anything that benefited the quarter.

Saagar, there wasn't anything related to a project closeout in the margin this time.

Okay. So just solid execution across the board?

Yes, I mean, just solid execution, good contract management. We're just continuing to do a great job.

And then looking at large project opportunities or actually just the T&D space in general, how would you describe pricing and margins now and opportunities that you guys are seeing out there in the bid pipeline versus maybe what you saw 3 or 4 years ago? Or has pricing improved over a 3-, 4-year timeframe? Is it steady or has it gone down?

I would say it's probably maintained. It might have slightly have gone down with the award of some of the larger projects that are out there right now.

Maybe add something to that. As we've said on many calls, when all of the CREZ work was bid, that kind of overwhelmed the market or at least the market in Texas, and as we've indicated many times, we don't see a CREZ II coming. We see a lot of solid work in Texas, but a major event like that, where there's 2,400 miles of work in one place, all having to be completed in, basically, 2 or 2.5 years, that probably drove up the market. We see the margin opportunities as being good, pretty normal, but we don't see the impact of what CREZ had on some of the bidding during that timeframe.

And last question on my end. Rick, you mentioned the C&I business, steadily improvement, steady increase in bidding activity. When do we really start seeing pricing come through in that marketplace? Is it end of this year? First half of '14 or does it get pushed even more?

We're hoping to see that improvement. It's still coming off kind of the economic downfall that we we're all in. We're still not seeing that fully rebound back but we are seeing strong improvement. So we keep pricing it accordingly and trying to enhance our margins every chance we get.

And what's leading to the opportunity for the better pricing? Is it residential contractors that might have came into your market going back to the housing side? What's the main reason that we're seeing there?

Well, one thing is additional work in the marketplace. We're seeing additional projects come out that are probably a higher skill level than what it takes some of these the smaller contractors that came into the marketplace. So I would say our reputation, our workforce, our safety record, all that, allows us to be well-positioned in the future.

Our next question is from Adam Thalhimer from BB&T Markets. Adam R. Thalhimer - BB&T Capital Markets, Research Division: The kind of modest slowdown that you saw in large transmission, in bidding activities. Is that seasonal at all?

I would say it's probably not seasonal. It's probably just due to the permitting of a lot of the large projects that are out there right now. What we are seeing an increase is in probably the smaller and midsized projects. We're seeing a kind of a very good increase on that. It looks like the forecast of those projects are looking good to continue. Adam R. Thalhimer - BB&T Capital Markets, Research Division: And then I guess investors have the concern that if there's a slowdown in large transmission, that the cycle is over. But it sounds like, from your comments, that there's a really good workout there, it's the timing issue.

Yes. Adam R. Thalhimer - BB&T Capital Markets, Research Division: And then on the C&I segments, you referenced 1 job that had higher costs in the quarter, that impacted the margin there. What's the status of the job?

The project is pretty well complete. That one had some design and engineering issues that caused the project timeline to be compressed, and our productivity and efficiencies were impacted during the last quarter. So we continue to pursue additional dollars for those impact, but our numbers don't reflect any of those dollars or potential upside dollars. Adam R. Thalhimer - BB&T Capital Markets, Research Division: Okay. And, Rick, what do you think the right margin is for that segment? Is that still kind of a 5% margin business?

It could be slightly higher than that.

The next question is from Andrew Wittmann from Robert W. Baird. Andrew J. Wittmann - Robert W. Baird & Co. Incorporated, Research Division: So, I guess, wanted to get a sense on projects rolling off, projects rolling on with some of the CREZ work winding down. Can you talk a little bit, how you're planning on redeploying those people or if you have the ability to redeploy those people immediately or kind of how the phasing goes as we move into the back half of the year and into early next year?

Currently, as those projects are winding down, we do have places for those people. As I said, the small to midsized projects are coming to market, we're being been successful on quite a few of those projects where we haven't seen a decline in our manpower counts. Also our equipment resources are staying busy, so we're able to redeploy those. So, as of this time, we don't really see any concern at all. Andrew J. Wittmann - Robert W. Baird & Co. Incorporated, Research Division: Great. So, then, as you're kind of looking at the small and midsized opportunity set out there, is it your sense, over the next couple of quarters, we'll continue to see this kind of stable backlog and trend there or do you believe that there's enough, actually, to kind of grow the backlog as you win your share?

I think we see enough to at least stabilize it. I would say we're doing everything we can to push it to the growth side and we see that potential there. Andrew J. Wittmann - Robert W. Baird & Co. Incorporated, Research Division: All right, great. And just final kind of a bookkeeping question here, was there unusual storm contribution or could you give us a storm contribution for the quarter? Just for our record.

Andrew, I don't think there was anything that really stood out in the quarter relating to storm work.

And next question is from Alex Rygiel from FBR Capital Markets. Alexander J. Rygiel - FBR Capital Markets & Co., Research Division: First of all, thanks for additional guidance that you provided on the call. I do appreciate that. But, secondly, could you comment a little bit on the mix of materials and subcontract costs that are embedded in your backlog right now? Is it a similar mix as maybe what you've reported over the last 3 to 6 months?

I think it'd be hard for me, on this call, just to the number. But, I mean, it's fair to say that there's less material and subcontractor dollars in our backlog today than there was a year ago or there was 2 years ago. Alexander J. Rygiel - FBR Capital Markets & Co., Research Division: Okay, that's helpful. And then, Paul or Bill, could you also comment on how the revenue mix shift, that's played out in the last 6 months, could now lead to maybe an opportunity as it relates to mining cash on your balance sheet?

Would you elaborate on what you mean by mining cash on your balance sheet? Alexander J. Rygiel - FBR Capital Markets & Co., Research Division: Yes. I noticed that your day sales outstanding spiked a little bit over the last 18 months, which I suspect corresponds with an increase in materials pass-through. And I was curious if you would anticipate seeing your DSOs decline back to more traditional levels over the next 3 to 6 months, as your revenue mix shift changes, and if you could possibly quantify that opportunity that you see in mining cash off your balance sheet.

I'll start. Paul has something more he can add. If I take the last several years and I average that, and that'd be my guess going forward. There's something fundamentally different about 2013 and our expectations for 2014 from what we had in historical periods. It does spike up and down, and as you know, that is a snapshot, a date in the quarter. It could vary significantly within the quarter. So, I guess the way I'd look at it, Alex, is take a period of like 5 years and you get 20 quarters and nothing fundamentally has really changed on that.

Alex, let me add to what Bill's saying. I think one way that you should look at it, and maybe others on the call, if you're looking at AR and you're talking days sales outstanding -- I mean, it is true that our AR has grown. It is also true that our underbilling has declined, and it's also true that we are on a better overbill position. And so, if you sort of net those 3 numbers together, you're going to see an improvement there, and where that improvement manifests itself is in a higher cash balance and in higher PP&E account. So we do track DSO, we look at that. Obviously, we want to have a low number. And we think, relative to our peers, we're actually doing that they are from a cash management standpoint, but we do think about that. So thanks for raising that point.

Our next question is from Dan Mannes from Avondale.

A couple of follow-ups first. As it relates to backlog in the quarter, we were, obviously, pleased to see it stabilize, at least on the T&D front. Can you indicate, where any material large contract awards during the quarter or were you able to sort of replace the roll-off of large project almost completely with smaller projects?

Dan, we replaced the roll-off with small and medium-sized projects.

Got it. So, number two, I think, Rick mentioned maybe a little bit of the sold on large project bidding on the near-term. That said, as far as we can tell, you haven't had a large contract win in some time. So, even in perhaps a slowing environment, my read is it's not going to take multiple big wins for you guys to be able to grow backlog, especially if you're already seeing some growth on the small side. Am I reading that right or do you feel that you need to win some big jobs to get this going? Or multiple big jobs?

We definitely would like to put a couple of large jobs in backlog, and certainly think we have the capability to successfully bid them and managed them, and manage the risk associated with them. But whether we'd be able to accomplish that, that's yet to be determined. But that's certainly what we'd like to have, several large jobs in our backlog to supplement all of the bread-and-butter, small and midsized jobs that we have.

Sure. And to your point, on the execution, I think, when we go back in time and look at some of the concerns I think The Street had, including us, back in '10 and '11 margins, clearly, you've proved that you've executed pretty well on these as this has played play that. So kudos on that. Just a couple more real quick ones here. You talked a lot about the market environment, including, potentially, in California, as much on distribution as on transmission. Can you talk about your current position in California and maybe your opportunity to organically grow there? Because I haven't seen that as a market of strength for you.

Well, we have not done a lot of work in California recently, and some of that is because we had so much other work in other parts of the country. But we have a bit work in California, we have been successful in California and we do see that as an opportunity for us.

But, as much on the distribution side, do you currently have MSAs with the large utilities in California and what would it take for you to -- if not what, what would it take for you to get there?

We do not have any big MSA, currently, with California utilities. And I guess, to get there, obviously, all of the utilities, including the ones in California, constantly are rebidding these MSA agreements, trying to bring new players in to compete against the incumbent players, and that's true in California and it's also true in other parts of the country.

So it's fair to say, number one, that's an opportunity to extend in that way, not just large project. But, more broadly speaking -- and I'm certainly guilty of this, we've we really focused on the large project opportunity. But do you see a lot of other areas in the country where maybe you're not participating on the distribution in small transmission side that maybe you can expand to, similar to the discussion in California?

Well, there are, probably, a few other areas of the country where we're not as strong as we'd like to be. As we've discussed on the call, we don't do a lot of distribution work in the Southeast. It's dominated by nonunion players and our nonunion operation is more focused on doing substation work and transmission work. So that's not an area that we're strong, but certainly would be one that we'd have some interest in.

Our next question is from Jon Braatz from Kansas City Capital.

Paul, you had mentioned that -- when I look at your cash flow, your net over and underbilling was very positive for the first half of the year. Are you doing anything differently or do you think that can be sustained and even generate more cash flow from your net billings?

Yes. I don't know if we’re doing anything different I think we're just doing a good job at what we do, and it's my expectation that we sustain that.

Okay, all right. And then, secondly, the gross margins, your forecast for the gross margins in the second half, a little bit less than the second quarter. Is that because the mix of your subcontract and labor is changing a little bit as you look forward or do you expect that maybe the project execution can't be quite as strong in the second half or is there a mix issue?

No, I think it's -- on the contrary -- I mean, we've done, in the past 2 quarters, including this one, where we try and highlight what we consider as nonrecurring, and so we said there was about 130 basis points that, as a result of what we did on a number of projects, since we try and have you take that out. So if we took that out, so where you were at 14.6, you backout 1.3, you're a 13.3, and so then what I've told you through the rest of the year, we're comfortable that we're going to come between 13% to 14%. Not including any onetime type events.

Our next question is from Steven Folse from Stifel, Nicolaus. Steven Folse - Stifel, Nicolaus & Co., Inc., Research Division: First question is you guys reference that there was no large projects towards in the quarter. So is it safe to assume that there's still some work associated with the V-Plan and CapX2020 work still available? And is that something that you guys are actively pursuing?

Yes, we are on both those. We're currently performing work on both projects, the V-Plan and the CapX, and CapX has several projects out for bid right now, in addition to the work we're performing. Steven Folse - Stifel, Nicolaus & Co., Inc., Research Division: Okay, great. And then I guess on another group of projects, the MVP projects in the Midwest. You guys have previously referenced that as kind of a total spend of $5 billion over many years. I think some of that work has been awarded, some of that in the quarter as well. So, I guess, two question. Is that work still being pretty competitively bid? And is the remaining scope of that work something that you guys are actively pursuing as well?

On the remaining scope portion, yes, we will actively pursue all work associated with that. That's something that's right in, basically, our backyard. It's work we want to go after. And, on your other question, yes, a portion of that work was awarded to another contractor. Steven Folse - Stifel, Nicolaus & Co., Inc., Research Division: Okay, great. And then I guess, lastly, do you have any commentary on the FERC announcement of the recommendation to lower the New England base rate a couple of hundred basis points? Do you feel like that's going to have any near-term or longer-term impact from the industry? And does it have any sort of read throes us from other rate cases in other areas of the country?

We've, obviously, read about that and some of the industry process, certainly it would be a factor. But as we've talk to utilities, I don't think the allowed return is the sole reason why they like transmission investment. Certainly, the higher the allowed return, the better. But the predictability of the regulated transmission business, where they get equipment rate base, they get recognition that if there is a stranded investment because a project got canceled, because of markets changing and whatever, that they get recovery of that. So what has made transmission investment attractive is the allowed return, the predictability of that return and the fact that if the market abruptly changed, they still get a recovery of their capital. So it's not a positive, but I think there are lots of other positives still in place, and as we talk to utilities, I think they would still, all of the things being equal, like to invest more money in their transmission system.

[Operator Instructions] Our next question is from Andrew Wittmann from Robert W. Baird. Andrew J. Wittmann - Robert W. Baird & Co. Incorporated, Research Division: So, guys, on capital allocation, just wanted to kind of get your sense. In the last couple of quarters it kind of sounds like you've talk a little bit more about M&A as being part of the strategy, but the share repurchases is still out there as well and stock doesn't appear particularly expensive. Just wanted to kind of get your thoughts on the priorities between those 2 events, and I guess also with the CapEx spend as well.

Okay. Well, certainly, as you note, our cash balance has increased a little bit, here in the last couple of quarters. All of those options, acquisitions, organic growth in maybe some new markets, share repurchases, further investment and the new equipment, these are all topics that our management team and board discuss, and bottom line, the bogey is returning capital to shareholders. We wouldn't want to take on some really marginal new project or an acquisition if we didn't honestly feel that, that was at least as good an investment of shareholder money as returning the capital to them. I mean, these are all active topics that management and the board are discussing every quarter.

Our last question is from William Bremer from Maxim Group.

Most of my questions have been answered. Here's two. Can you remind us what the level of the MSAs are within your backlog? And then, Rick, maybe this one's for you. What's the current running of capacity in T&D at this time?

Bill, on the first thing, I don't think we break out or we've ever broken out how much MSA dollars are in our backlog. So, I can't offer that up to you today. And then the other question, I'll turn it to Rick. If you're asking about our labor utilization, I'll let Rick also answer. I mean, labor utilization, in theory, should be 100% or you're not doing your job correctly. On fleet utilization, obviously, we want the highest percentage but we never offer the percentage out into the market on that. But, obviously, we look for the highest level as possible.

Thank you. We have no more questions. Thank you. I'd like to turn the conference over to Bill Koertner, President and CEO, for closing remarks.

I'd like to thank everybody for participating in our call. We look forward to these every quarter. It gives us a lot of good insight as to what's on your mind. I don't really have anything else, so I look forward to next quarter's call.

Ladies and gentlemen, this does conclude today's conference. You may now disconnect. Everyone, have a great day.