OEG - Earnings call transcript Q4 2021 | Orbital Infrastructure Group, Inc.

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Operator

Good day, everyone, and welcome to Orbital Energy Group Fourth Quarter 2021 Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, John Beisler, Investor Relations.

John Beisler

Thank you, Josh. Good afternoon, everyone, and welcome to Orbital Energy Group’s Fourth Quarter 2021 Conference Call. today, quarter issued earnings and closed for press results. market fourth its full the the a company release After year XXXX under A in of release this Orbital the newsroom the website. copy section Investor Group is Energy Relations of the available

Jim are as Financial Executive results Chief Vice Chairman Today, for and well financial management developments. will the call Officer; today’s and Nick quarter and as on recent O’Neil, Speaking highlights fourth Grindstaff, Officer. Chief review the

amended. and company’s would to other the remarks, experience providers, could budgetary the future due also economic, new as and projected and in market political on increased government as manufacturers, reliance COVID-XX, service and agency, the today’s constraints, a in supplies such Securities factors, formal will statements results significant of changes management third-party competition, of everyone risks certain number questions. of I operating competitive the XXXX results those factors those liability and and Act statements. vary These demand products, to cause forward-looking statements. and in results the that from to to projected like uncertainties cause Following in from company call forward-looking The operating fluctuations integrated those XXXX answer remind forward-looking others or its significantly statements prior that services. periods could in to may are solutions Securities to and the contain of will performance Such Exchange made subject actual and vary materially under Act and

turn and with Commission. information Orbital Jim, to Group operations are are these the to certain ahead. materially as as to and please CEO These I of factors based Orbital could Jim Chairman its forward-looking statements change. the respect Exchange Energy company the affect update statements obligation company company XXXX, no forms Energy. would today, With like call O’Neil, with these and the in Vice the over Additional and Securities other that, of circumstances to has filed and assumes available to on XX, information March included which go

Jim O’Neil

thank fourth conference Good Thank and call. you, afternoon for XXXX John. quarter attending earnings you our

Before in I Orbital and CFO at Nick with to both also developments first the Nick thank COVID-XX me Group’s you commentary, employees on joining on of we quarterly welcome of share professionally quarterly a on I face dedicated positive OEG. our to want is and who as Energy conference Grindstaff, lot work today want very his today have tenacity start I of information my some call. challenges all XXXX. for their I as and personally hard to

interfaces exceed Our our services every OEG customers Each appreciate brand, of and your providing represent much efforts. and day, meet workforce that you safely the very expectations. customers’ with I our

conformed improvement meaningful the demonstrated of revenues the XXXX. XXXX consolidated or with compared financial increase segments. periods of And are active reporting discontinued portion and to a to operations, with our to Orbital Telecommunications segments better quarter, operations. details an been has communicated align provide have how to Nick will prior million operating information these operations, of the our EBITDA $X.X non-GAAP a million, align Any discussions Our and for XX% to a the the Houston continuing we our measure, reclassified record financial reporting results third his communicate we for investors has and $X.X of in and our company period. manage a In were been was quarter. to We recently our business results $XX currently operating compared Gas fourth U.K. our which was loss the prior to reported our Gas call. a results Orbital positioned fourth Renewables, In fourth quarter divest -- positive in and announced adjusted Power, sequentially being improvement redefined full year quarter, operations. our the for the million, on Electric new from more

Gibson on will and X for profitable the transformation company’s Electric meaningful year, XXXX. strong come. positive Frontline During with serve had will service established market The Services and Power to transformational provide to to drivers, our XXXX, shareholder industry respectively. coupled companies revenue us Construction, the growth Telecommunications value deliver adjusted many believe that of in Technical success acquisitions, the platforms from through continuing growth Power execute past operations X we for in our and over These strategy years positions leaders significant and years EBITDA and we are completed have segments, they

for As of the full and This revenue an midpoint are year million. million an range to expectations in adjusted $XX and such, based EBITDA and million, revenues for EBITDA to are and increase of range improvement Revenues we XXXX. adjusted XXXX our the is between reflects between EBITDA to compared providing of $XXX year on of million full $XXX million $XX XXXX adjusted XXX% expected a expected guidance. range of $XX.X the of in and

year-over-year record for to year-end strong energy We our interconnect sources. quarter-over-quarter. the [investor-owned] organic CapEx backlog growing the levels Electric anticipate our they services and XX% Our at modernize of by customers renewable year-over-year segment, has increased our driven and over deploy revenue utility grid demand as growth largely Power X,XXX% sequentially from from

growth Deployment programs in for Lightsource Our the programs: and infrastructure. of In solar the X and on experiencing XG of and Renewables XXXX a Telecommunications awards, experience driven deployment spectrum utility-scale large LTE Bear the program Happy our will we segment and projects the currently equally of Black RDOF, utility-scale Fiber enhancement XG BP. Rural by or significant in are segment, organic construction of resurgence are solar

utility-scale solar likely stages will over billion opportunities, additional this Additionally, we receive of where we to additional construction that various are are solar in on $X pipeline to awards of move negotiations year.

for our come. to all said, With to over segments comments. his momentum call with stage set strong we drivers are across for XXXX, years of experiencing that we turn market have the I that As for enter many success will Nick positive the

Nick Grindstaff

here XX I’m and value. for thrilled Orbital and forward and prior Jim at the shareholder Thanks, I team look here reuniting Group. with us years to together increasing toward to be to working Energy Jim. worked Orbital Jim

results in in today Form reminder, discontinued U.K., sale. December discontinued the now North in Gas our our are Gas Detailed operations to financial results Orbital XX-K. a I’m continuing results held or reclassified from not from providing Orbital As our are operations be disclosed for operations do and included assets and will from our include which were America

million from continuing operations record quarter of of of Loss we today, million mentioned, of million. for income Jim XXXX. fourth As adjusted announced quarterly the was an $XX.X net loss taxes $X.X EBITDA $XX revenues with

best for Going operational our financial forward, investors performance. indicator of EBITDA believe an the as we adjusted measure is

You to non-GAAP fourth will a to loss as measure, and EBITDA find of quarter continuing press our reconciliation measures, operations, GAAP a a continuing operations, earnings EBITDA adjusted from both from supplement release.

continuing was the operations quarter, share per fourth For from $X.XX. loss

Loss share results the increased the XXXX, full third improved year continued net $XX.X fourth adjusted of million. sequentially EBITDA operations million. our adjusted $XX.X XXXX, quarter revenues the our for to to $XX and of an results was financial loss the demonstrate operations year income These quarter were For continuing from XXXX. as EBITDA XXXX. company $X.XX. and Loss continuing XX% the of of was In in per deliver million and operational revenues XX.X%, from of taxes much improvement full positions consolidated respectively, compared performance with

$XX.X to well These and the solar the the in in distribution toward and million, to These was operations. investment service In For was XXXX, per to the primarily quarter distribution loss XXXX. projects of EBITDA positioned Frontline year operating absence a are increased of acquisition loss was the million, share an compared have million. delivering from to and expansion quarter and ongoing of continued operating taxes third XXXX. utility-scale in operations XXXX. continuing legacy generally $XX full of of were XX% revenues fourth operations net Adjusted income compared full the XXXX, investments electric XXXX, loss Net million the from results year greenfield results power Electric electric Power company positive revenues $XX.X attributed $XX.X due to XXX% of increase operations of foundation our segment $X.XX. of the continuing the of Power

the revenues $XX period, increased a to programs RDOF funded area. million, federally Telecommunications on commencing the XX% Over over segment construction primarily same due X-state to

the Although delay the fell the of quarter project. million, an to segment on third from expectations, increase had Renewables in of the revenues construction $X.X of Black to due primarily of Bear BP Lighthouse short XX% XXXX this

is includes and third million the level. end the total quarter X,XXX% at XX% record XXXX, was Our XXXX of up fourth another quarter backlog over Backlog over the sequentially $XXX.X of of million comparison. year-over-year nature Telecommunications Electric backlog service our under Power repeatable half revenues sustainable are for of $XXX.X Approximately in and master customers. a that of agreements XX-month and on

positive notes. types we our XXXX lead X extended growth, organically months. equity be all signal very Power with that benefit that opportunity million refinance sellers a for roles have infrastructure include $XX and May EBITDA, have May strong over are million we were today intent to XXXX. various the early-stage performance, top to be Frontline coupled consolidator. fund into optimize the for unique regard the institutions will Also, is and prior company’s work had capital in XX, address optimizing our in we and backlog, the combinations $XX are As due shareholders. strategic XXXX, $XX OEG, to the with structure move priority agreement to positive structure million conversations and again, services engaged of improving believe the the I potential will with lenders, to structure Options with company’s and that an a several financial to capital acquisition, companies an of not value. of structure capital is I maturity the acquisitive of the of to through XX, our reached the we maximizing are quarter-over-quarter exploring capital with instruments, debt we on both ability position is ensure part seller shareholder industry coming remaining our The consolidations while to to toward in the of to at

Turning to guidance.

adjusted we As in and strong XXXX. growth revenue Jim EBITDA anticipate commented,

$XX contract million we full year EBITDA Renewables double-digit and XXX% the and XXXX, an revenue segments, our EBITDA and $XXX growth EBITDA organic of adjusted unprecedented This in to range in under This revenue segment $XX to for range reflects compared adjusted under million expected as full believe the growth is in going led construction consolidated these from $XXX of million Telecommunications our and $XX.X solar forward. improvement our growth to have as year million. Electric utility-scale XXXX adjusted of million, for improvement our is XXXX X guidance. in year-over-year we be strong segments due to our is services the demand For programs and XXX-megawatt-plus by well revenue our to as largely projects Power midpoint

As a Electric in revenues over $XXX we this business the recurring North it activities base are segment, years, relates to believe amount next significant several replace, agreements continue American range the revenues XXXX to increase of between the that will organically service to and will infrastructure. required million. by provide $XXX upgrade and master A million expect existing of utilities’ to primarily segment rebuild outsourcing under we Power driven

not the services, segment of maintenance, the wireline In is by XG restoration-related to $XX spectrum included and revenues construction, rollout wireless testing for as segment, expect We guidance. in we LTE RDOF demand adjusted driven our customers of design, range driven revenues XG the commissioning million the excess Electric by construction to largely will and Telecommunications as not increasing realize well funded Power million, in Any of around federally $XX emergency our upgrades in system our this by in enhancements. EBITDA we XX%. XXXX and margins be programs engineering, expect the

this Our in margin XXXX for mid-teens. is EBITDA the expectations adjusted segment

be X in $XXX This to that in Finally, mid-single additional awarded anticipate to for in that $XXX million will X full the Orbital projects XXXX. the this solar of in be million. move our Renewables revenues margins will the digits. to we anticipates to range year of XXXX, range Adjusted segment are EBITDA segment construction for utility-scale Solar expected

$XX project joint provides As this through pay outside contributes a cost Solar construction to million consolidate participation, Certain to for be solar will Orbital unallocated utility-scale Power, its Jingoli for XXXX. a which for the estimate We but Orbital Jingoli these costs segment. holding of profile defined their and company to operating reminder, and revenues the generated with will of Solar market XXX% procurement the to where solutions segments. costs exist absorb in lower-margin venture engineering,

basis, earnings a operations, GAAP continuing EBITDA measure, to reconciliation expectations and from EBITDA XXXX. supplement in On decline quarter release a continuing in quarter of a as slight find in sequentially to quarter from quarter. revenues from into as expect of perspective loss higher we with be both slightly revenue the to operations, a quarter adjusted our measures, the fourth to XXXX, the growing consolidated relates our fourth third XXXX the press will non-GAAP seasonality a You a then fourth it first than

operating chain We for Margins as all the successfully quarters be well contingencies are across do project subsequent also to segments. execute as year. in for through as most our the increase individual We year. volumes our of experiencing anticipate of and supply throughout margins first quarter customers issues increase the lowest we the

working to workforce. maximize plan been closely customers strategically productivity of our our to we’ve However, with

cadence We guidance issues have you chain we the the supply into have provided taken today. into current to of account

Power. as these corporate timing cost XX-K certain as While economy of the couple as Telecom as with X These COVID-XX and acquisition refer to acquisitions: will we in Please in other and details well IMMCO by and quarter-to-quarter expect of well years. costs of Frontline Full the Moon these uncertainties acquisitions, our the Telecom; Gibson amortization, company In the for tuck-in pandemic, the unallocated change and costs of our to exist business XXXX, GTS; XXXX components. driven integration and significantly today last the and compared associated issues the completed in the items. or magnitude fewer acquisition acquisitions

turn will I back to the call over Jim. Now

Jim O’Neil

in platform for companies, market recurring will Telecommunication positive capitalize I beyond. joined both required the of CEO and companies been debt acquiring capital our considerable and has for these in years segment when October of opportunities operate in a The not come XXXX in with in add profitable equity. GTS with I profitable I now trends to structure. as amount transformational Nick. XXXX you, never Frontline platform for in our organic form objectives streams GTS of revenue characterize as in growth and Frontline segment, strategic on and growth our long term Power would industries. year our is and the Thank as we significant a of to strong OEG. are the Power our Electric acquisition Power X company XXXX, To envisioned and has intent It capital organization existing accomplish positioned the the

ourselves we that position our delay market imperative was it established of However, presence without these take advantage industry to positive very to dynamics.

Our capital and priorities with accordingly our reducing in of to transition. optimize structure, commented, our XXXX. capital top one in repositioning leverage performance Nick And structure our sheet balance operating as improvement is is

that XXXX for drivers call our employees concludes each strong a with foundation confident build and of answers. open Operator, I’m the from a We services. segments our shareholders. questions in and we’ll for that up strong have very now market to operating remarks, our will and year our for rewarding be prepared

Operator

comes from Jeffrey Alliance Our Campbell question Global. first with

Jeffrey Campbell

quickly regarding currently likely the you natural gas businesses. U.S. that and businesses business separately? organized? just expect the as Do the to U.K. is Jim, more of will it sell sold be it’s Or sale the

Jim O’Neil

It’s that in strategics likely be geographically regions sold work. they separately, same that that work they’ll the more to Jeff, than

Jeffrey Campbell

has million. Frontline for like the bill dropped It short-term sounds to $XX

in what that just regard? are sort So of you wondering, options entertaining

Jim O’Neil

repeat catch Jeff, million? the I that. $XX didn’t question. your What about

Jeffrey Campbell

$XX rest from the year. I down million, has the it is then bill, impending Frontline said dropped Nick said like sounded what the the one that to next

upcoming. the wondering $XX that’s thinking regard just million I’m to what with you’re about So

Nick Grindstaff

Yes.

market. So the yes, We’ve are got several we options. in

regard in to the options of expect solution a by that equity certainly and and debt May. both have exploring end We’re

Jeffrey Campbell

continue ask that to the fit And wanted Frontline the T&D I Power to OEG’s how Okay. is now as you that invest of portfolio? growth ostensibly platform, division in into Orbital well? does will

Jim O’Neil

that been Frontline. synergies almost realize the much tuck-in. leveraging great those going year-over-year. tuck-in Orbital the starting will almost the line, XXXX. like We’ve actually and a into Power Orbital And and Power with look is already platform Frontline being to improved a of improvement we’re which to in That’s bottom question. like a we’re Orbital Power’s part be to being best practices benefits see We’ve

Jeffrey Campbell

thinking heavily is Because understand Orbital was with one is MSAs if are I Frontline’s aligned the to it thing Power about whereas I Okay. Power states. business of some other in that, correctly, Texas, Orbital

So the you states reach them, I keeping markets of and just was that entities. that of of wondered an both attractive can the with X different feature if diversity

Jim O’Neil

synergistic distribution Orbital provide us very gives And I resources, part Power with it in both electric the that customers. company strong most the scale They’re working they important that in to with geographically Power Frontline think the the services. building ability acquisition particular. is and together capability and about new a services greater those in

So the there’s coordination between more X companies.

Jeffrey Campbell

Okay.

was a mention evolving other are there discussion be as likely backlog would the this most a possibly expected companies Renewables just to I for with wondering, in of relationship to You those come -- Or the was there come of year. was [Lightspeed]? well? projects when additional it with from

Jim O’Neil

this certainly diverse The Black that to we set relationship projects we’re Lightsource our and pipeline with, and gives billion looking many developing us that’s obviously, opportunity expand we’re a work had been other them. on, year. But $X Happy with the potentially BP relationship is relationships customers the that for tremendously. customer consists value we which to of And Bear one

that XXXX. least guidance X to construction will X So in projects get at does more our expect to to move

Jeffrey Campbell

to the on I well, X. wanted that area last -- Okay. actually, And touch

difficulty that other there’s pieces sources that and to regarding We’ve there obtaining solar considerable from projects. equipment mention concern was materials, aligned and particularly of some utility-scale logistics that. and panels are the about solar third-party in heard First, inverters of

you to sounds degree. -- like it I share So that don’t a just concern high

just I’m to what risks? done wondering, have So those you blunt

Jim O’Neil

But suppliers months and concern, more lead look before time, the X way we a time The some running XX It’s about it’s now strategically. I work at Jeff. with pandemic customers it lead items. to X our it months of and took about closely the is, on those

we you that to just be we we very possible. there to work in advance. for with other not And to are all supply it can as customers plan well across chain segments, our can And to of the mitigate have just on the any project, best interruptions, of more whatever So do the that’s Renewables if as efficient our parts work segment.

Jeffrey Campbell

my I to was regard maybe how fiber-to-the-premises what And does then had IMMCO translate the Gibson? Okay. a designs for are about and Orbital X with expansion. final into might was just wondering, in the question have IMMCO specifically synergies and fieldwork office more and the Gibson million IMMCO, recent IMMCO IMMCO. announcement portfolio? work Or

Jim O’Neil

right? work, Well, the tip new get well. of wireless design the bring in to but customers, engineering do design is the you base only broadband also customer who IMMCO So they’re as expanding capabilities bringing our and for and is spear not and to in the customers engineering

us is historically go our So a provide to a good to lead-in provided that engineering. just for where total customers solution IMMCO maybe to

Full because well them acquisition of customers track where us in on And, installed. GTS especially for bring an do end record and the success commissioning done full for Full of today, of either gives relationship have the is a has a they’re the many infrastructure been past. as of our work other solution, the and everything it which a are of the the Now one-stop-shop what have was off IMMCO quality spectrum, that built they huge the when Moon, of opportunity they once testing looking or Moon to

really broadens one-stop to is really our a provide to our it attractive customers. which shop, ability So

Operator

would any questions for any showing back at this now to like further Jim over I remarks. not to I’m call And time. turn the further O’Neil

Jim O’Neil

Alliance Well, Virtual I’d in we thank listening up to you coming Global all operator, that that’s this participating today. you, remind you Conference and are of Wednesday. to the for like

May. report representative If AGP you’d a We you Advisors. Have Goodbye. XXXX Three contact quarter our first in results we to schedule your please a great like forward when to speaking look meeting, evening. or with Part

Operator

This participating. Thank today’s you. concludes Thank for you conference call.

You may now disconnect.

Orbital Infrastructure (OIGBQ) 4 Apr 222021 Q4 Earnings call transcript