NWPX - Earnings call transcript Q4 2024

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Greetings, and welcome to the Northwest Pipe Company Fourth Quarter and Full Year 2024 Earnings Call. [Operator Instructions] As a reminder, this conference is being recorded.

I would now like to turn the conference over to your host, Scott Montross, Chief Executive Officer for Northwest Pipe Company. Please go ahead, sir.

Scott Montross

to Earnings Company's Conference welcome Full Quarter and XXXX Year Call. morning, Northwest Fourth Pipe and Good My name is and CEO Scott Montross, and the I company. of am President Chief I'm Officer. Aaron today Wilkins, joined by Financial

you should was p.m. which February Eastern By now, yesterday all have to press issued approximately our at XXXX, access XX, Time. release, earnings X:XX of

This call replay. for being is webcast available and it is

for are year made forward-looking could like of on XX-K such I Form and materially actual to we would XX, recent discussion to SEC that factors for remind differ the the that expectations. refer cause expectations begin, could future XXXX, other call and our this results statements our risk statements, regarding actual a Please differ results December our As everyone for materially. filings to most our ended from

update for results obligation us of statements. We achieving detail. outlook and today. to environment. strong will financials in We through in market delivered record begin greater XXXX, our you joining our with a I'll undertake any operational a review performance then walk and XXXX. all complex performance for financial you in forward-looking no Aaron XXXX Thank

conditions one net environment. With what XX.X% an added of Our million the SPP impacting of history, market side the on a market our remarkable nonresidential precast bidding would business highest $XXX.X sales decent company's annual call over in our of I of the and were volumes. increasing XXXX but our depressed not element

well X.XX, importantly, both quality operating our as our in record profitability of produce underscoring demonstrating strength free with incident we unwavering of rate that share, XXXX a with of our environment. performance to employees to commitment as strategy a profit as us cash of as well-being record stable total dollars recordable and the Most $X.XX safety translated earnings. our achieved to the our per gross consistent consolidated which demonstrating led However, flow generation, record was well

a million down To XXXX, record XX% $XXX.X further up segment from break revenue level results, totaled in segment our SPP our year-over-year.

resulting our the higher Our changes as timing. levels project bidding consistent performance in well production ongoing due reflected backlog as strength level to from of in

increased of from SPP as and million was backlog, XXXX. to September December slightly $XXX December million XX, orders, XX, $XXX of as as XX, confirmed including down million from $XXX Our of XXXX,

The fairly remain bidding consistent XXXX. expected environment to in is

Our has and do continued SPP team great bids to job on a executing projects.

selling by partially due However, costs. our realized primarily lower performance XXXX was prices material offset lower raw to

$XXX will XXXX tariff recent on times though general, are weeks, now lead declined higher about in pricing in rise a XXXX, overtures help SPP for prices the up steel in of end believe XXXX, turn, steel higher year X to steel of levels and we at prices, they SPP business. standing in throughout from positive the our from which pricing. support we steel favor are In higher ago, support project in range, been still approximately With have While January. the per $XXX the below X well ton

record Now Precast million our new turning a to ongoing despite revenue year-over-year Precast in market. nonresidential annual of to segment. construction the X.X% increased challenges $XXX.X

led strength Geneva the of strong shipment residential driven as business production on continued was performance side demand and Our by our higher levels. to

our some shipments were of partially precast the [indiscernible] our strength. business on nonresidential While this healthy, construction offset at reduced very of volumes Park

higher commercial the interest continued rate current for to construction. the As has affect environment market

it previous strength than Dodge in December of Index was growing construction market the indicated XXXX. was in However, year, nonresidential higher Momentum the 'XX for XX%

flat. the institutional prior the remained sectors sector was commercial year The versus while fairly up XX% period,

and demand at downward residential price pricing the driven low On demand increases throughout XXXX, business these business offset our by Geneva side, the benefits. of from benefited on multiple more portion pressure pricing nonresidential strong Precast while locations, Precast than our the

book December million into of $XX as million XX, up which XXXX, indicating of million, XXXX. momentum XXXX, December $XX as from $XX XX, of strong significant was order surged and to our heading from a Precast increase As September XX,

portion Importantly, Precast on at a The remained the side year-end of fairly on our Precast surge Precast in book business order stable large of side nonresidential levels. book strong of Park order residential the our Geneva was business. the

in profit strong up Our margin we [ and in current record Precast This of the at XXXX. of up XX.X%, reported and year-over-year $XX.X was XXXX another consolidated from the gross XX.X% the annual in for gross ] million, XX.X% SPP configuration gross margin is strongest resulted company.

XX.X% Our SPP production XXXX, approximately as strong, absorption higher in overhead product primarily by mix. volumes strong with due basis also gross over to well was increasing of XXX as margin points changes

Geneva margin has in location margin demand lackluster points in Our changes commercial compression. strengthened rates construction resulting year, mix, from XXXX, to XX.X% last Precast interest portion declined business gross of the product of some approximately versus the XXX side of margins higher by led resulting basis primarily on the construction from our nonresidential residential from while

on like has strategy, Spread a I business. top which our Precast Next, would the been priority to provide grow our an crucial element to strategic update Product of

worth to orders, utilization we worth year. of This plants the our X approximately overall booked and of million outside Precast Level enhanced in production our product achieving help over at As and for maximize volume. projects goals Texas part efficiency Texas-based spread, of bid XXXX endeavor million $XX of $XX capacity

in of Level $X.X our product spread Park-related additional booking As of on projects part at traction in plant we gained Geneva approximately the by XXXX. X, million Utah

Park Level established that other more additional Pipe legacy expanding we're And in Northwest of spread, X of the locations Geneva as Precast-related product locations. and products process Precast Utah, now to at are products the the part Park finally, comfortably

new for excess of of is million Our book in projects XXXX outside Texas. $XX goal Park-related worth of to

more in benefit XXXX We results put place and into our will expect Level X will and begin beyond. midyear be by to

drive invest equipment efficiencies. Additionally, footprint greater and to capacity we organically are continuing in expansion to and our

pleased process concrete reinforced to and are Utah are our at pipe Salt commissioning. complete City, mill Lake of manhole the in facility and We the

growing this intention provides Geneva facilities investment rapidly continue production capabilities. organic additional capacity and the reminder, is to with Precast to our a drive As in to growth. our invest It operations

in other also maximize investing plants. legacy Northwest Pipe are to our efficiencies SPP We

In and our the reach manufacturing by addition production to our progress we focus opportunities and space strategy help would in growth, Precast-related product our accelerate Precast on evaluating portfolio. actively and increasing geographic M&A capabilities efficiencies expanding organic that on our are

growth $XX to plans, with we sheet our ParkUSA. our XXXX and incurred acquisition the we the debt our balance of healthy with liquidity. finance Concurrent debt, In of actively are ample remains we repaid million repaying XXXX,

we absence as As I've opportunity. of will a past mentioned, this in shares the our opt common did M&A viable year of to stock repurchase we

the I'd modestly Before business, to versus lower to SPP weather revenue severe continuing our various last our we to of our and quarter typical conclude, unscheduled downtime SPP I have the year at outlook to summarize for that seasonality weather impact like In and Due related facilities. product anticipate events. first of XXXX. the of first nationwide led quarter mix conditions

light the environment a and second aligning similar year year. with That strong to we margins quarter expect last bidding anticipate the the with strong XXXX. third full closely we in while quarter, of quarter we said, first XXXX bidding entered SPP with However, activity to backlog. in levels we And first expect be bidding

remain projects. of and seeing by We we're transmission activity continue to current encouraged on upcoming the amount our water

with we of website For found a more entered complete our on our Investor In the please business, view which within can review tab & order projects, The strength section. Events and be in XXXX. book, these are are of indicating Presentations investor improved we a Precast presentation, residential our the in remains year order the nonresidential projecting now strong a strong, robust book business the and a surge seeing XXXX.

good quarter XXXX, of For be or are of well Precast our than first associated strength the as levels absorption to production first order book. due quarter and revenue growing expected and our margins higher higher as of to the the better XXXX, as

for the the demand level long believe of Precast significant specifically XXXX first growing basis, expect market first infrastructure similar the to and We U.S. we position. On in spending in need of pent-up XXXX. a relatively of for the growing housing continue strength to be business in to our of term the the quarter and to quarter mid- given a the residential consolidated

continue weather locations country across As impact. to the an have in events various

in growth summary, Precast record safety our We from Pipe solid strategy to XXXX. complex I'm at our pleased like a in record bidding strong executing look and metrics. and year. In with very XXXX forward across order for I'd a to benefiting highly team market environment performance another market thank of book for execution their talented various Northwest our

are employees to: Looking maintain on the at to reductions shareholders ahead, opportunities acquisition of the implement return to five, of priorities number through volume; and our two, value company; over focus four, strategic proud work; on cost are share workplace grow our opportunities, company; margin focus one, three, levels opportunistic the our in all safe M&A absence repurchases. to and intensify a continued where efficiencies our

Aaron, I now over our to detail. will call financial turn will the who in greater results walk through

Aaron Wilkins

to good corporate sentiment hold We about financial direct core I'd with value as echo culture. company entire to the company's our safety safety important to surrounding I'm like on back-to-back and We outstanding has Scott's success morning, everyone. our year. believe congratulations a Thank record team's to you most you, accomplishment. safety workplace the Scott, and Again, take health correlation the through. the to this performance

was from to record $X.XX of of $X.X Now Consolidated and share in benefited for profitability. quarter diluted share, note the or the also million million I'll I'd diluted profitability discuss quarter our fourth per the net $X realization fourth uncertain or our positions. previously compared that XXXX. quarter year tax per income $XX.X

approximately reduced for our favorable of income $X.X the net our fourth There the in been approximately was would Without our diluted earnings the resulted in on XXXX. our tax year share this quarter million item, income included quarter per unique income item for share. in like or net this anticipated, effective have $X.X a or rate impact $X.XX of consolidated and million no quarter per XXXX. full fourth As of

year XXXX, per record share income share in a to $XX.X or $XX.X $X.XX consolidated diluted diluted million $X.XX net was or full compared For million XXXX. per

ago as driven shipped in $XX.X to in quarter. by commercial fourth in million $XX.X compared compared segment $XX.X at tons bidding market of fourth XX% year Pressure Geneva a as increased Utah was Our in quarter net XX% primarily sales $XXX.X strong, million quarter improved The in Steel to resulting sales Pipe $XXX.X fourth million million quarter construction increase continued increase ago. demand $XX.X partly sales improvement compared in a quarter solid timing. volume increased to and produced, million increased remained an in the offset from X.X% consolidated was XXXX. in Texas. as by a was X.X%, million the to the segment year softness the well to by demand driven Precast environment project changes This our in operations X.X% continued in demand

our XX% a selling in Precast by decrease product from were negatively resulting changes impacted in mix. Additionally, sales prices

products of Pressure of highly Steel composition Precast, which a the the comparable manufacture Shipment of the are are sales in in average the production As periods, reminder, provide we for on between segment's case mix. do not corresponding case dependent Pipe both volumes segments product always and unique. prices each volumes metrics the

sales $XX.X ] XXXX. million quarter to fourth sales $XX.X the [ or XX.X%, fourth in million of quarter increased consolidated of profit or Our compared of gross XX.X% XX.X%

affected, and $X.X as impacted starting over from of of we higher XX.X% these profit applicability million segment retroactive during XXXX, was their in Pressure incremental as by product $XX.X approximately conditions XXXX. our production tariffs million If improved ongoing jobs the Regardless gross were sales July disputing fourth well XX.X%, costs by profit of million unsuccessful dispute changes to mix. next steel the sales quarter. tariffs profit merits in primarily application, on XX.X% our of or reduced the quarters. margins quarter in foreign compared volume tariffs the to associated of $XX.X resulting negatively expect the are gross for of of Further, gross with enacted be market sourcing segment Steel our our to X enacted in of handful realized SPP million over these previously future due Pipe increased we the the steel and or $X.X

changes products. company's in from of position commercial proportion fourth to Precast We intend to to in quarter due work $X.X X.X% lower-margin the vigorously a defend or the matter. to gross derived product from shipment decreased with XXXX, primarily XX.X% this $X.X of or of million higher XX.X% Precast regarding volume mix million sales segment of profit sales specifically

$XX.X XX% and for share-based quarter of primarily general or expense, $XX.X the of increased to sales. compensation administrative to sales million to quarter XXXX XX% increase fourth compared was in Selling, higher cash-based of programs. and incentive The expenses both including the due million or for X.X%

the Our in noncash quarter in to XXXX quarter. fourth $X.X share-based million compensation $X.X was expense million ago the year compared of

our or net $XX.X X.X% due sales million costs. incentive XXXX, selling, year, program expenses performance-based of of or X.X% increased to full the in For $XX.X consolidated and general compensation compared higher also X.X% to million sales predominantly to administrative

in was million. the million and million to full Depreciation SG&A amortization year the consolidated XXXX, year quarter. fourth of to to the XXXX we compared $XX of be in expenses the $X in For million estimate expense ago our $X.X range $XX quarter

year, amortization $XX.X expense depreciation was million compared in For the million and XXXX. $XX.X full to

depreciation for decreased We be $X.X from decrease $XX approximately million XXXX. to year XXXX borrowings. million due average quarter in the expense $XX amortization $X.X the million million a and fourth of to daily Interest full to to expect expense in

to increased for the full XXXX. million expense to full year XXXX, compared be million. interest expense For expect to year, million $X.X the we $X And approximately $X.X in interest

tax in in XX.X% rate compared tax income resulting of an XXXX expense an rate XX%. income Our $X.X tax effective of to million, million the or $X.X year prior effective income was

to by a was our of uncertain the in originated. rate year As the tax lapse from due limitations effective significantly tax the income statute discussed, positions for previously tax attribute of realization income impacted XXXX

tax tax resulted in tax In income nondeductible and impacted impact quarter was million. fourth full This rate and accrued uncertain by our favorable a approximately on income primarily income differences, positions provisions permanent the of on $X.X state year effective XXXX, rates. interest

range within XX%. We full the be for year tax expect XX% of the rate our XXXX to to

flows Now I'll transition XXXX. in We condition. our to financial strong generated cash

operating by For million net to quarter, compared of cash quarter the $X XXXX. the $XX.X million in provided activities was fourth

by $XX.X improved full year, from offset reduction cash provided the by million, operating in For activities due provided to in we million from XXXX $XX.X our increase profitability, cash a net working generated a partially modest of capital.

pipe quarter-to-quarter. cash free due better which business, capital year steel $XX will of anticipated full million our Additionally, flow needs working to largely vary was shifting than in our pressure

$XX range For cash anticipate XXXX, we $XX million. the between full free year to flow million and

focus As enhanced of generation cash previously emphasized, a leadership our key we remains team.

for $X quarter capital compared fourth were Our expenditures quarter the million XXXX. $X.X of to fourth million in the

to to spread term. to of the and anticipate million, For businesses to grow in CapEx in to initiatives both Precast $X the projects, million product we at well full about year investment in various Park as range most $XX Geneva the as support our million notably XXXX, $XXX our $XX million near the revenues be including

of our borrowing of December outstanding credit $XX.X capacity million of million our additional had the $XX and on we remain both in start our new committed expect to including we XXXX, strategy capital providing anticipated returns, to borrowings from approximately quarter. line. focused adoption leaving credit allocation program stockholder facility, second repurchase our As share which a is X, on on early transacting We duly in growth

and beyond, precast In pressure believe earnings well are businesses have the pleased annual revenues, XXXX level We gross achieved our our achieved summary, performance share. positioned into records pipe of growth through-cycle we we precast. and in in per extremely profit steel safety, new remain through resiliency and that new

possible who you and continued Company. Northwest support made and of to their for dedicated these shareholders Pipe employees again Thank our our achievements trust to

turn the question-and-answer the begin over now to operator will to I session. it

Operator

the Company. Sidoti question line from & comes first with [Operator Romero Julio of Instructions] Our

Julio Romero

had You year impressive XXXX very a free similar XXXX, strong flow flow. cash cash guys and in pretty with free

comments flow talk working alluded as portion, in the cash on especially front shifting needs the that you're your of between expectations portion for cash the how 'XX Aaron, thinking to becomes your that variability especially Just SPP of you business? a of the of about stronger about the managing and quarters, kind flow free capital as

Scott Montross

of in think that's specifically been current you to last item as we that's year, the related management And an on tell big for I the that flow the compensation variable focus would I is the we focus ultimately, business. assets, mining what SPP on has a Julio, cash a cash made up part the said tied everybody's group. in

So all there's a of time. attention lot flow on cash the

into the goal cash that sure much we're the cash come where more get a report fact, In tells and to period. day or focus are we're we company, a specific we month in has make getting it's to and month. every a revenue for how And try time every recognizing always us

So I'll little bit. first it's that think I really let quarter and Aaron the focus on -- the that. about a talk And

we're that. to into what bit cash in good with or we is be little there's cash flow-wise. first going The negative so belief think on focus I saw quarter a quarter. coming flow improve much either versus first It's be the our that where a But were last as XXXX. should cash the in different we year flow than

So goals at focus. it's looked the day, part It's of every everybody's a it's company. in and big

to want little about first you the talk quarter? do So a bit

Aaron Wilkins

in we things quarter. has things last quarter, really the quarter of which us into came think, due talked Pressure strong have be and ratable lot of saw. proceeded so be year. year we end XXXX, performance shaped quarter is of have my business started Yes. for to you than set the billings up the course XXXX, a a that to a first just which first billings that I really we didn't I Scott through estimate Julio, for, slow the had different year will of performance probably the cash would better Steel needed At in well guess, the first of in up on the that we'd and year, to why flow This to the strong pretty pretty about. have Pipe We the our the much

bit flows we And the softer second to $XX that range balance up improve year get a then maybe things see to a of of through million the that ] of little [ cash have quarter, with million the but about. kind progress $XX talked to and

Julio Romero

for the to can then But also 'XX. it. SPP bidding stands participants currently outlook it Got and maybe expect cycles to of for what for for for on 'XX And talk there. even you of your fairly you year mentioned additional is the consistent especially though compared balance industry the stable? as less industry you of and full work, about beyond that, environment even Very given helpful guys environment kind profit bidding that previous kind capacity means fairly the remain

Scott Montross

and the capacity, what amount running rated to mix able if to of that's certain tons. you far Yes. well, about now. haven't the that's start practical down certain have and optimum probably But on rated business, be a saying, quite a having we as XX SPP [ that ] When capacity a you're you Julio, as gauge to we year ability XXX,XXX capacity produce in or then so rated a at whether And of okay, about talked ranges tons capacity? -- capacity looking well, it's of just while. is look to say, our XX do in

tons. XXX,XXX capacity is XXX,XXX somewhere to we approximately marketplace. half in practical in area And the have capacity probably of for So the of the us about

even more I capacity that. what market tons. market with that likely the with enough XXX,XXX the coming are total IIJA, in some able is area do capacity about than to or be to expectations XXX,XXX there of the And think So in place is

able multiple remember, at if is most running us. Pipe market these can only us, be ships able for to to we're than pretty more ever Now you instances, one Steel to quickly give Pressure up going to way the plants, handle to you in be start scale

'XX, higher concerns 'XX 'XX, handle projects have in don't are the to levels the 'XX, any ability production tonnage our we out that expect we all forward. So going at put about that to IIJA-funded

think we don't issue with that. any we have So

we In that. welcome fact,

Julio Romero

there. being about the towards and you Very side, helpful experienced the that surge Precast Precast on And that in you at weighed then year-end side. the order talked Park, [indiscernible] the book

we how if that maybe the that progress could to Just XXXX? portion, that translates throughout just cadence you to non-res speak how the of as

Scott Montross

So XXXX. to related And Momentum projects And I'll Index. the generally nonresidential important that that's of go commercial these shipped are and start XX institutional that representative has projects stuff. and think about then time a generally reference start produced. watching that's really with going there's getting getting then relatively getting months they held planning I start orders the produced, And through Dodge is start why before really strong gap customer start ultimately, into of right? they placed planning in before a and to

which we ParkUSA, coming to just are that relatively and you And then bubble that look through business pipeline in levels they to on in and bodes nonresidential -- shipment coming XXXX that really book have this translate when because not we well to because saw and we between bubble the through book Index projects a And the probably so the and through of That rates market. nonresidential happens at the was impact normally surge nonresidential a or through, little it nonresidential the year-end, bit interest XXXX. XX% through in a So the which happen, for Momentum XXXX. see off of Park, Dodge strong it suffered grown we're started into has XX% the production order the at of order facilities starting rough for business. and the doesn't

order that seeing grow. are We book

we than in we double XXXX. size Geneva the stable very strong levels. the to stayed appear to when -- I'm but them the about coming And going pretty ask business you has And didn't this relatively levels for revenue in business, levels, the side, levels the -- the production be residential put they're in shipment It's on of acquired anyway. the strong more and at So XXXX. Geneva the back revenue this,

in face the I So live to of state -- kind very, even very just in. facilities for multifamily the and interest really, higher stayed into that rates. that the is the migration single-family demand houses strong Utah strong And net think of of the speaks and and to

asked a strong the So pretty Steel going the XXXX. what be bidding business, we're beginning going Precast at you Pipe we're Pressure into like was with to market seeing that And in it similar is seeing to XXXX.

year the is slower project we the the first year expecting quarter Now in by bidding this to Pipe pretty little what Steel just 'XX. a Pressure strong the finishing really second way quarters in bidding and did falls, but we're third similar and

Operator

Our next Securities. question of Jackson Northland comes from line Ted the with

Edward Jackson

you I maybe get wanted on more color brought and me. up tariff that was news the to to start that thing out

back if and of kind you're I in you the provide about happened, little first with for have what steel regards was 'XX. what for was on of to brought better these could product a paid the that is -- in color tariffs I potential assume the that talking -- a So guess, for you will term, of that lack half in, half to

you correct? then things the maybe I all, for was explain that there's then That's going question. situation any was secondly, read of first did can First of kind and what if kind of And my what and forward? that ramifications just

Scott Montross

ultimately, in tariff put said, "Hey, got a that's ] we're on the a a to you When kind you the basically really happened [ twofold XXXX, of at that and XXXXX melted not anything administration So July up proclamation it administration. part retroactive that and really is was I by tax is happens going on tariff. our slabs actually this reached XX% came And Brazilian the we that's a And and But in producers in U.S., been what think And producers tune poured a tariff Canada issues -- us the Mexico. produced hit regular question. this of script, retroactive decided the okay? tariff before to to a to basically, in from -- were of previous that that tariff. slap basis. brought Aaron on the was Ted, shipped kind from the look that administration were coils those Brazilian the quota -- under did of what have we slabs, the the that steel -- quarter of, fourth in or quota one it and of

into But $XXX,XXX administration to in and amount that. quarter, hits forecast that's first and built we've the things probably our the like previous ] impact. [ which already us similar a

to all Ted, I'm see about that's looking want and the table there, stop at going if So and the you we're to now on that. talk one how

Edward Jackson

kind going to with I with was start wanted this. where That's of I this.

contest paid. you there actually are a [indiscernible] $X.X that Is So ] chance back? would [indiscernible] this and [ get million

Scott Montross

been We've this. fighting

fight this the things administration proclamation. right a out basically the have has there's the proclamation time, this fighting going right now, different over new that's which a especially now. is for from and since But tariff attorneys We the would something we confusion anything problem -- this is long of right? wipes old Because a lot

But fight that able this we've to to already. process to is long going be ongoing through be thing. So and a been this doing

slab We of piece that Brazilian thing. the we're this trade in and attorneys fighting from through have

So...

Edward Jackson

of things administration on question does #X I some for of that of more but I kind to you of the a know was expensive I and your steel must questions better economics, in go it pre impact around And place? demand. in and customers, tariffs that if it and this mean, -- how stuff need tariffs your cost does because those to they brings really of business? pre-call, the the thought basic you your guidance does point, kind and term, at kind the kind thing I lack of process proposed mean, up my transition things put out -- in into the was get and How hurt that to on -- the first We X the wrote Trump parts. pass

So regards your discussion on playing business? for tariffs to on you with administration's maybe with efforts that how and a see out going what's the Trump

Scott Montross

yet. the obviously, for relatively, hasn't with discuss -- new kind of guess, set bunch they're Is there's could obviously mentioned. a and same lower lot impact it much looking that's about tariffs you're the it little the long-term I to this long there's time, Mexico, are that a it has the trade flux inflation, in a of these what's just good putting really One there is of is a GDP period think if So rate long-term as tariffs the is thing. that this it. with of to things And makes I the to the says, policy a out because a this influence if bit administration you But GDP. bit you the a information XXX could the interesting platform thing little X.X% things the it And a been okay, And tariffs China, below runs is hey, of on which growth Canada, points? impact administration, the that? that GDP counter on that well how basis new at. by think, thing at

because at do But we analysis we around are. this the risk a we've to because had where look it of way

in -- a have we Mexico, have our So we Mexico. plant biggest right, thing LRC is

discussing what told should the right mined because some we sit there's we as that's ship United into exclusion ambiguities in an is in States United Mexico, -- what and ship it for buy the now. back, that, understanding right we're right? it melted we're steel that States, being get we able So steel Because and the to now. that's the be And and

risk had to analysis But this. do again, around we've a

scenarios. So we've basically X got

of plants. if is denied first request obviously, exclusion we a have we the The lot Pipe Steel have SLRC, for for Pressure is

Tracy million facilities of as and revenue on of Pressure several the and and Adalanto the overall Pipe be move a We And X it forecasted have have the X dollars take profit, We to little basically of a hit plants. impact that we Steel them. but other could to needed. work bit gross

one that's scenario. So

back the then for and what U.S. plants United second United it buying get business into Maquillador States, basically, The the just scenario the because thing. -- shipping we're it on melted load we steel And We the our exclusion. in means States. that and the is the into mined shipping Mexican plan is

So apply there any to be wouldn't that. that tariff would

doing would right just per produce And plan basically, now. we're as we

about a this, thing States. tariffs Pressure against just their that, So obviously, that produce plants And to is with in and draw Canada the Pipe situation needs saying British to are for the going Columbia. And ship more have lot other tariffs that Steel the Canada. product we no Columbia on retaliates is there that's we which go probably is that of United retaliatory interesting questions transmission in water British and

is, SLRC, into of they if Mexico is kind actually and bit without a the of ship issue. a assuming that the tariff file Canada But creates retaliate, little doesn't that that produce that beat. SLRC from products of fact Canadian at produce can against an missing we So Canada a or

exclusion from exists a be of Canada if into But and can against sorted got retroactive be SLRC. ship tariffs not if lot SLRC that's fact also a there's tariffs filed, and obviously we're filed retroactive, negative. -- information the tariff not we So exclusion the can in or SLRC could but here is out. But that to retaliatory there's be given the

fact we Pipe means So those the around business. some can between things between lot plants whole have without work probably the that and we damage that Steel move X plants I really of that a think utility can to there's that around we Pressure

in to and ask and questions lot you this, up shut going a have said I've some I'm and minute let you a for So go.

Edward Jackson

was not was -- but know that any more -- super don't Scott, than that I that, I, Well, interesting. actually,

it the the little administration as that the lot do the discussion seems side. want to whether big were will on just to kind of Trump A market in. kinds finishing the a pull But regards And for bidding is of I all regards things with thanks some a your like to administration. mean, some of answer. there's there is that you into with funding. most with back trying activity funding things trying the Trump bidding -- you environment, he's renewable I is over to of do is reel off to the back of what more on concern driver infrastructure the for So mean of the I Trump of expecting? any shift that look

Scott Montross

funded learned infrastructure for weather cases lack to that careful have nothing those of really projects things. they the of fires affected going fires and time, we Well, of like because and that things 'XX, IIJA water that with be more be is XXXX. things concern Probably all is and 'XX. in lot tragedy 'XX, obviously, to the see the to droughts like we more able out with not there's the a infrastructure that, that out aged of related events to think in the fight have would extreme one on is there I they the really and 'XX, California But risk be replacing the in to water

that was the California like or really Newsom -- control pretty this to the I make state they pretty from they the sure administration offset or of guess, on they to had to and were things the hard that in at things happen. ability pointing do Gavin pretty And didn't thing

of could So like IIJA take that more I they're that is the Well, it be But the place think put needs careful to affect with some this things across to maybe. and And needs for infrastructure out in going in really start replaced safety be to funding? only be the think to really communities doing for that precedence. I future stuff because not support that of there country. growing all out with

point, this we at happening don't see Ted. that So

Edward Jackson

super of kind It's clearly of couple The is A ones. SPP business smaller Okay. strong. the humming.

environment But for number saying like in we revenue. delivery, product saying a are of quarter the fabulous curious in terms asking a past? if the So terms the you -- has -- where of I'm from fundamental like of talk you the kind not historical you Like -- that of are I'm of kind that -- of for is you macro I'm regards to -- stack against you're highs? Where full produce, how up you've your historic got best of with number where what's tons does looked fourth in within terms say, business where tons, in of but more been XXXX, standpoint about in products and tons. relative at, a where kind to

Scott Montross

the would versus we're business. Pressure up this quarter that that are tons probably overall of our previous were pipe is last tonnage versus there the I quarter Price versus fourth -- But less overall tons seeing in say fourth historical significantly what significantly tons I Steel say was would the in and up year year the year year. Yes. on for the

But that a seeing less projects. my you thing? "Oh not Now say, really we're is demand God,

efficiency of We starts are of grades the produced seeing of the transmission less water go those kind that that the tons. And quality to I the things. being think projects, now, products of design to steel and are

evolved, that's So I think too.

bit can that less that an a amount a on we're business. I So really, seeing seeing we're starting think really it's But in that's of business efficiency you to that. and little the they're And of of similar of tons side engineering because not having like projects. thick on stick take handle hold grades to higher a put will, that pressures gauge projects steel they and a steel, if things of as have

of is think And XX% us, for point. the really, we've So XX%, got marketplace. I that at what this that's

the can this marketplace successful as that of we as kind we find growing with actually little to a a them. just and conditions seeing be work the we as point. as is -- business with But So we're evolve at bit

the bit, at this that of more than go but point. are start up lines to a tons I are think to being the anything going little think efficiencies I built, it's

Edward Jackson

Two more questions.

where in But it saying core year, would, is given pretty One be business clearly show to kind market to of the But within kick, room of the more not business, maybe that you got you you're business strategy. for important of business humming. I I'm have M&A color -- easy like little into you're strategy. really you the portion ones. with won't that you've run things. to executing just if SPP on grow, a of and side M&A the and have mean you well a are it's going and then at. organic it's Geneva on I mean the the very next very, where them your share you kind hard to dramatic growth

there that. process our like like How So kind you one you of past, the then forecasting that is you things opportunities a do bit about are you this the for come kind within And after within in that many term, any M&A, have you where have have better would front? have on at? irons chance -- of horizon. in fire X I How you years? with happen something that like looked or are lack year a talk the I the provide a have of can next follow-up close whatever mean,

Scott Montross

going a that the of be We're Ted, this at, we're plan. way year, everything now, Whether on. looking if path. this that -- something a [indiscernible] couple that looking it I point got goes happen think things could next are down early at at we things year year the could or are we've moving this they

-- on line. to for that forward not coming starting at the kind are line starting to looking and say point. we're on that execute at, the we're the I on opportunities of are there We're So would to things us be this able on act past

the real at in interesting The on business, look the thing things strategy right? are grow you Precast of when the play. strategy is company, side the to there the is So overall of

So the want -- of company, there. We be which we have kind we're $X to billion and halfway strategy. a

a able now kind to line. million $XX we've million, So line, top $XX got billion are grow the like company $X to those lot the right to we're on a to top side. be that things of whole And get Precast seeing

to be us key that of that little bit kind The pace. mass $XXX might for top opportunities to it's a million but lot cadence, be look with right? bit a got at Geneva, the at that to grow that quicker be where things level bigger forward line are a little appropriate going able we some we're to allowing things of looking like creating to to at going So get at us similar growth what there's the organic that have So to of to is happen have there. with happen along to us those that

these ones bigger looking that that's wrestling of strategy around our we're to the kind be look right idea couple with there do the on other that we of the business, of to the there's any able of some be got that out do forward. updated we've it that good. we're think is if growth in sense. creating piece thing pretty now might But Precast And makes focused front the going at I more and in So -- of for a mass create how us

Edward Jackson

It does, your and at just your your steel purchases? if at were like then was of I by just you a my question, to how COGS, COGS like look SPP percentage what kind quick last business, consumed look one, of kind of

Scott Montross

It's it to right now about XX% year. to XX%. what It's last pretty similar was

Operator

[Operator Instructions] Ramirez from D.A. Our Davidson. next line Jean with question of the comes

Jean Paul Ramirez

assumptions Quick clarification, of it, but for and first the sorry I'm Precast missed if your quarter for are what margins XXXX? I

Unknown Executive

Assumptions for precast margins for the first of quarter XXXX.

of XXXX in with line I be area. in expect with line they're I the in -- they're what think -- think first a to know I similar quarter don't was

Jean Paul Ramirez

relatively how and All that XXXX, out XXXX? carry year? does into price line right. your assumptions And with bid backlog, all your higher activity the steel account or looking with in And on through are seeing just just we in about said being margins levels you than the taking line at SPP XXXX

Scott Montross

mean, up obviously, the with I growth strong in million previous in from up -- say a would backlog $XXX our quarter. $XXX I ended the about to we No, XXXX million,

So the was growing. backlog

steady in margin margins demand that as pressure -- long XXXX. seeing -- as way you're out now some go stay going what as we upward with think it steady the to I the see the level relatively we to on that through we we that's have right

period, seeing okay? hope these demand currently coming we're we we're levels, but a into that okay SPP great, are -- demand a period where coming you're in levels not into think I they're So and

us, of see is going years coming couple levels front higher. once think those the with we starting levels pressure funding, you're As X. going margins IIJA we X of instead of we where demand to start are in steel with bit the And demand to get into next what out the instances, to push those you're little up see a higher, pipe a going think, it's

long that think the way we're demand realm So going to of I the into as think kind coming hits hit. it's as we

Jean Paul Ramirez

Appreciate you really the for nonresidential little Can model bit looking side, perspective? about of the XXXX? do on being to talk that. make developing expect mean, strong. a about margins you a activity and at business through you as you that it. that residential the how I And here And -- Got mark talked when see follow-up, its on

Scott Montross

Okay.

side. nonresidential the with start I'll So

I nonresidential the -- to are increases end end think side to is again? to starts carry get those show that's Park levels really really nonresidential see quarter and in and the production think the the through the think we for then the those the once of up improve back those We toward we our mainly really and that business raising toward production to of the levels the results quarter probably nonresidential first quarter. key that business. probably question levels, the was start hit relatively going and the right? end first And of normalized margins What second we order of year first the

Jean Paul Ramirez

just are want you second to you kind through the of just all of it hear about progress just normal an impact The do of you see have quarters? on steady similarly, on guess, sort that Or X I I residential the through and work Yes, cadence possibly side. expect And XXXX? levels half? margins seeing

Scott Montross

residential of in -- Utah. I our the see X especially side think see seasonality, because Well, business you in plants the you are

of snow in little they tend bit Utah. a get So to

to them a said, And then were But worth mean, And construction was like look the at then bit third lighter lot the starts activity And big off contractors because are freeze area the So mean, ground I down. the to acquired $XX quarter in revenue. they of quarter and a slow $XX quarters I fall revenue. like XXXX, the the Geneva ones. somewhere to start and I quarter. million the and if about the of we in million in of business XXXX, Geneva first you when said, little makes second it starts I fourth

the it's So double size.

the this product XXXX Exact to us, have for Geneva Manhole create in Salt plan. -- going we we line. some continue helps We additional continue is for well, put year machine. and And and it Well, Lake have that in to the new to also to RCP that facilities plans build capabilities help a projects new City, investment us top

$XXX run -- time -- time get by that at Geneva to to XXXX. run by a the end million be and of we annual Geneva in the end have facilities to rate the expect be the place the we at to of $XXX plan million at rate a we the facilities, XXXX We get on

to that's those and margins margins at the to get Geneva keep they XXXX. pressing increase to over we allow XXXX up were increased going going the it's business absorption in because increased Geneva in So that where

or on of So points It demand the by about by of that so. -- business. down I think the the XXX about was it basis on that piece nonresidential because side pulled

Jean Paul Ramirez

I it. a follow-up just color. quick Got here. And appreciate that

in just by for the talk mentioned you have $XXX next end just any Park that about us outlooks about couple you revenue a the Geneva let do and million of little You bit perhaps runway years? sort the of -- XXXX. know, Could of

Scott Montross

rate we to of $XXX run of by like Geneva. the on million Well, each ParkUSA both end see XXXX. those we goal do facilities have of as the same for at a XXXX We'd end the

Operator

Montross any concludes turn back I'll the to That final session. question-and-answer for our floor comments. Mr.

Scott Montross

end. we before things few a Just

we about, for year cash profitability by SPP in historical had we quarter gross As had both produced pretty and resulting record the full and free standards that was and of a had with sales demonstrating had. issue earnings and $XXX revenue flow, annual share, of million that that that the market. net for we profit a of that tariffs in record toward quality fourth and XXXX, the headwinds the on profit strength moving faced for fourth revenue a $X.XX a some that strong as Precast, and income administration's we XXXX affected and effect tough Yet application a as market We of previous the quarter. we nonresidential talked the well ad-hoc

in different role, XXXX, this face headwinds headwinds related as my we're to didn't going a head we facing open, with remember XX into tariffs. on years But in I can't time completely to And that we really business. XXXX be this in

difference and as geared the we headwinds, with we now is and be positioned them. the think successful conditions very to the I we're experienced handle to well expect

into go big going expecting strong, like As we in 'XX, strong we a with very a year we're of saw million $XXX XXXX. backlog in

and that's pretty a year business. We the Precast have a surging $XX expect very, for Precast order very SPP for and book consistent over million the year a strong business

going we're employees, driving improving to growing and safety through M&A continue on for organically focus and margins, value. on our And both shareholder focusing to

program place the As months. in Aaron couple share mentioned, a of we're anticipating in new buyback putting here next

XXXX. good a expecting we're So

the frame in we this. talking time we're I'd call. months to here doing to like earnings your to forward attention again in just few May thank for and your all attendance a you participation and when to the And look you next

thanks So much. very We your attention. appreciate

Operator

concludes Thank you. call. today's This conference

your this for may lines at You you time. participation. Thank disconnect your

Northwest Pipe (NWPX) 27 Feb 252024 Q4 Earnings call transcript