VATE - Earnings call 3 2023

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Operator

Good afternoon, and welcome to INNOVATE Corp's Third Quarter 2023 Earnings Conference Call.

[Operator Instructions]

Please note, this event is being recorded.

I would now like to turn the conference call over to Anthony Rozmus, with Investor Relations. Please go ahead.

Anthony Rozmus

afternoon. Good being review for XXXX Third us Results. Earnings with you INNOVATE's to Quarter Thank

today Glazer, INNOVATE's by Paul joined are We Avie Interim and Voigt, Chairman CEO; Mike Sena, CFO. INNOVATE's Innovate, of

earnings release innovatecorp.com. at We have posted and slide our presentation our website on our

session. our will Q&A be our call We archived by will to followed being with on call begin is remarks also prepared be a This and simulcast website.

forward-looking cause historical these earnings and actual make the certain materially made disclosed could statements assumptions, our filings facts, with call, INNOVATE's and factors will that the in differ safe this subject to not be is Reform Act the the and further management forward-looking may other to such of our detailed During of release XXXX. that assumptions risks, these to and Private are statement and risk included could involve differences Litigation which more from cause pursuant SEC. results are and assumptions in the provisions and factors certain Any are fully risk presentation XX-K are harbor statements. The that slide in cautionary statements uncertainties forward-looking Securities and

and measures, also greater performance. believe not required supplemental are in will In stated while allow or refer this non-GAAP revise data, included measures, this We useful GAAP addition, our review or that only update to reports. forward-looking substitute of intent transparency date Management by law. provide EBITDA. obligation our in the INNOVATE, certain for for the financial these made except SEC call the a as measures conference forward-looking operational of in call as financial as expressly such as statements of to these adjusted and that, disclaims statements, any

pleasure my things Glazer. it to turn At this over Avie is to point,

Avram Glazer

third and to INNOVATE afternoon. delivered $XX.X EBITDA million. the grew of in XX.X% million adjusted revenue quarter Good $XXX.X by

essential to It the keen operating our X of on our strategy quarter this segments. results all focus Our of is profitability. highlight

in multiple have initiative, We on in quarter. this executed segments operating adjusted EBITDA the improvement third achieving year-over-year

continues business while further for EBITDA quarter growth INNOVATE, results contract for the The strong still backlog, on in line. infrastructure adjusted Our strong provides margin this future revenue. the to expansion Infrastructure quarter. bottom somewhat deliver in experienced in especially visibility

Turning plan along a approval. continue to with and skin Life Sciences. MediBeacon while make enhancements to rx, down RX RX for product path for new Glacial the device, FDA remains progress. Glacial on fx, several MediBeacon launched wellness new

we strong Spectrum, business. At assets that a have in foundation of

add opportunities call strategic the revenue Paul should potential and to exploring that, With value Voigt. these to in over unlock a further for to partnership lead turn the are I'll which We to growth. assets,

Paul Voigt

Avie. Thanks,

of of well X.X%, revenues the Our XXX XX.X% prior perform year. to in and by EBITDA strong margin and DBM quarter expanded Global X EBITDA operating $XXX.X versus with million another third DBM to quarter, adjusted margins basis $XX.X respectively. million XXX points approximately XXXX. basis adjusted and delivered by points approximately million In segments $XX.X continue the gross in

outstanding an margins. job has protecting our and Rustin done DBM team

aid XXXX the especially projects, We more deliver West, continue opportunity We to the should prior out to for to that expect larger, complex bid to full-year margins continue increased on year. margin see huge still to expansion. compared further

markets. a of with multitude DBM expertise project across capitalize their stayed opportunities on nimble to unique various

the converting remain backlog. on backlog the end of focused the was into We billion adjusted quarter. sizable the complex projects total $X.X Our at

RX quarter across Health results. unit launched the new Care an device sales experienced several not board. exciting previous outpaced our quarter platform, technologies and our U.S. On product only a X enhancements all

reach XXXX. performed eclipsing RX and XXX% with same worldwide, with global of begin growth the record approval a over In XX,XXX to addition, in in patient its Canada. over experienced treatments number treatments patient period in results also selling expanded RX

RX has skin commercially wellness addressable its RX's wellness a and device market fx. total fx due classification this to other new spas launched expanded channels. and system, Glacial to is Glacial include aesthetic

include for advanced Glacial clinical larger the for disposable launch enhancements colder, the Glide FDA-cleared dip and treatment rx body of protocol Rx. product Additional called

These treatment and portfolio emerging patient utility product outcomes, of of making enhancements Glacial improve enhanced the for providers, standard care. experience

device For program, package substantive the the kidney designation MediBeacon, the and States. which United reviewed FDA explained last submission was the completeness now we module previously quarter, for monitoring conducting the full FDA review granted for is breakthrough in

FDA addition, other FDA study the and This for the visualization. applications received the MediBeacon's is ophthalmology QX platform study authorization States. in-human in priority of agent expected gastroenterology, to fluorescent MediBeacon to on begin of evaluate begin United plans provided of clinical the In surgical first ophthalmology. and in use MediBeacon XXXX the feedback technology to

are We they kidney the for innovative progress FDA the as made has through with to work pleased MediBeacon process approval continue the technology. monitoring

to approval. to months And starting growth are FDA an was signs Spectrum, XX at the to over typically The XX X approval television, see last industry. process lastly, submission the average takes across of in months broadcast we which of encouraging soft

January picking new networks. new for launch by promising. Earlier XXXX Studios of and start-up as week, looks new are nationwide 'XX distribution up outlook this stations Warner network Free TV, backed our Our stabilize, X advertising Lionsgate and a prices announced

is will broadcast some national together TV coverage over-the-air who networks. years, Jonathan Katz, the for XX platform, new executive profitable we and on designing TV, the for to the networks with work of Gray TV Free over founded provide and last most broadcast the responsible opportunities. continue developing with Our him will X launching revenue

of to take particularly and that up. Also over-the-air, are revenues we applications, picking together and data providing cable number to conversion software advertising a now to year, in state-of-the-art network We of such broadcasting. the coming are with several casting areas implementing broaden the are in also working networks looking commercial streaming our stations opportunities as with distribution their of of advantage

X.X a conference very ahead. years on I billion Spectrum last very the We Spectrum other revenue with said over are pop, excited UHS stations. TV Like in the these and megahertz have valuable our we XXX about for opportunities call,

operating the with with more teams across strengths and Lastly, prospects management at the our assets these opportunity past CEO on come encouraged the the further even the each of of of to work unlock over forward from to continuing value I've we and X of segments. work discussions quarter, each away our to I've these had look each closely ways can businesses.

on strategic I As to we the alternatives last mentioned noncash assets. on flowing continue call, explore our

turn RX financials for momentum build are a We review through over to and continues to market, approval I capital see to structure. FDA right in their that, MediBeacon the process. it Mike With our and of go starting

Michael Sena

year third driven Consolidated the was $XXX.X The and their HMN, revenue EBITDA million, share equity million driven our period. partially corporate which third nonoperating total segment quarter compared from of from prior Total the the offset was for an investment primarily adjusted $XXX XX.X% per the XXXX in XXXX $XX.X quarter decrease a Life was the decrease Infrastructure period. by and period. increase segment. Paul. by in year of XXXX, prior million the income in to Thanks, Infrastructure Spectrum to $X.XX March $X.X was in of which segment. Net Spectrum compared a method The $XX.X per extent, share of to Sciences of million or lesser net quarter was was of loss $X.X common elimination prior attributable and sold in XXXX in increase was the and the $X.XX year million or stockholders loss our for of our segments, a million third to by

in prior revenue $XXX.X from year quarter. decreased XX.X% million Infrastructure, At the to $XXX.X million

erection increase Steel primarily detailing at was and by this fabrication driven was and an construction, offset size decrease modeling partially earlier, and due DBM's at revenue business, As industrial at maintenance discussed the revenue timing the Banker and the by of projects. of repair and business lower to size projects in timing and business commercial steel which and

lower increased quarter to fabrication prior increased due EBITDA construction contributions contributions in driven adjusted $XX.X and increase million This business, steel by higher-margin period. modeling and $XX.X timing the of million was in decrease Steel by Banker for year projects from recurring the the of the at Infrastructure primarily and SG&A from to projects. third size was detail XXXX from partially The expenses. business and timing erection offset a of

XXXX, to XX, awarded, was signed into which contracts, billion, takes but yet consideration reported $X.X adjusted and billion compared at September of XXXX. As backlog, the $X.X not backlog of end

to result debt year-end resulting an in part opportunities repayment loan the meaningful earlier, DBM sale, see on million repayment from increase by partial $XX.X an market, converting a in debt, Avie and is a with XXXX, driven amortization by DBMG payments As in focused offset we $XXX.X note which asset into opportunities normal decrease of ended the the continue backlog. from in partial principal outstanding remains a and RX, costs explained those quarter of million of of equity a and losses EBITDA cost reduced adjusted SG&A a in decrease expenses, investments MediBeacon X. to well investment to in suspended decrease the as decrease research compensation-related to as at as primarily Sciences, Life result losses amounts as in by in method marketing losses and due carrying recognized reduction being expense a facility. At from credit was initiatives due lower the driven development Pansend's

networks quarter of At end to XXXX. Azteca which compared the was an new which revenues current of offset with customers elimination the $X.X the primarily markets a driven million, in revenues, by million ceased was of of its Spectrum, advertising $X.X and period. the operations third launched by This at decrease partially revenue at increase station in XXXX,

primarily third SG&A adjusted in by and decrease year Spectrum was of at reported $X.X salary expenses. million adjusted an and in expenses increase in benefit-related due quarter. Station $X.X severance compared in EBITDA EBITDA to the Group, increase quarter to driven prior income losses an of million The the

the in adjusted quarter an decrease EBITDA expenses well severance by as million. expense. net XXXX in decrease The of was as a corporate primarily driven employee-related for from million of third reduced legal XXXX, expenses third in and losses improvement headcount quarter $X.X improvement were decreases a $X.X the by from Nonoperating

quarter, a of to basis, equivalents XXXX. excluding third XX, XXXX, corporate the $X.X $XX.X the million and as of end as $X.X at of cash cash and company the segment of cash restricted million compared On December -- of compared cash nonoperating cash At restricting cash to XXXX. September XX, our excluding had $XX.X the equivalents, of end stand-alone million million

the end the previous related a in has collected changed of of period. the prior receivables result calls, to mentioned capital balance working reporting movements As to as cash

unsecured September RX's Capital, payments. of the Infrastructure's million Infrastructure's XX, As by by and offset corporates, end new was additional total driven respective principal from principal line million from Lancer credit draw had partially XXXX, $XXX.X borrowing primarily XXXX, CGIC, of of their $XX.X indebtedness million, outstanding up which with $XXX.X on note at INNOVATE

XXXX. which entered from today, XX, HCX its August the secured maturity $XX.X Lastly, XXXX amount, notes extended date million to Broadcasting its of to into XX, an amendment principal August

to questions. like now we'd open up operator, for that, the With call

Operator

[Operator Instructions] Your line first question Pressprich. comes from Brian of R.W. Charles the from

Brian Charles

about that business higher is margins on. in It's dovetails growth consistently the with in -- good coming about that in as I kind remaining earlier. your a little business the in the kind to I talk progress that fair of now, say backlog being declining. -- the see presentation, selective has you at of guess it backlog after then does take the improve in EBITDA the the reflects projects continued it out just continuing But it looking year and And Infrastructure to business stands to And see the and XXXX. more the been bottoming likely this

Michael Sena

year. as What so the to you've say is see improvement we seen margin I'd -- stabilize. expect We've have -- in started But -- somewhat seen where think over I the margins -- that Thanks. Yes. And they're continue seen to see margins discussed throughout we XXXX in to margins we'll the had over backlog. earlier, in was for improved exactly we what where have we XXXX. come at which see continued

Brian Charles

follow-up And Okay. Fair enough. there. just one

projects? talked credit about forward the that impact of go Or about making your space. which impact your earnings markets of that to an evaluation is continuing to them the Is of commentary in is Some you customer that projects selective more on influencing release certain the in commercial the with? and tightening base

Michael Sena

management think we've and has them. then be is DBM management I the the team the opportunities that mentioned, at related as And converting credit with with the the right on but market, -- team sizable seen working sector, we've the we have still pretty markets what mainly to to pivot Rustin tightened No, the markets, and see DBM in work. has been commercial into able to

Brian Charles

Okay. if think about would If continuing do growing still XXXX, stabilizing or you projects. be had asked, into you to higher I margin backlog the be can decline selective

Paul Voigt

projects big on flat could year-over-year. going would be we there's West, that out there's big said, I hands projects being if up or to get But that our be X or it's that we X especially say some X, Vegas in X big.

Operator

conference no and you for further Thank are Instructions] There questions this this Ladies time. today's [Operator gentlemen, participation. call. concludes at your

may now You disconnect.

INNOVATE (VATE) 9 Nov 232023 Q3 Earnings call transcript