HIL - Earnings call transcript Q1 2022 | Hill International, Inc.

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Operator

Greetings, and welcome to the Hill International First Quarter 2022 Financial Results Conference Call. [Operator Instructions].

As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Devin Sullivan, Senior Vice President of the Equity Group. Please go ahead.

Devin Sullivan

Joe. you, Thank and Hill everyone, for us joining Good First thank Quarter for International's Call. Financial today morning, you Results Conference

for Ghali, Raouf Weintraub, today Officer; speakers Todd Officer. Chief Chief and Financial Our Executive are

undertake begin, Act during call the the Except of matters forward-looking statements based current plans, assumptions are it estimates made meaning limited XXXX, ability protected we certain our and statements willingness be and business Private our to, the forth other our considered by and COVID-XX are pandemic, and and and this safe maintain risks I'd for statements the expectations, development projections, to historical not everyone not such and to complete related may the support remind including, activities. and thereby. Before future of governments that information, to Securities statements intent, to but strategies of uncertainties, forward-looking These any ability risks be operations but statements any and to subject and within like that including, statements for on Litigation intent and is any infrastructure financial concerning of statements. set or uncertainties objectives clients harbor herein, are the to, created our forward-looking limited projects belief Reform

forth Including or materially Risk contained statements Although statements actual no factors to backlog we projected believe may anticipated. elsewhere any Exchange reports economic forward-looking statement. not and the actual our to expenses or results undertake from in reasonable, Securities not our be and We are forward-looking could adversely the realized could update set business, with estimates projections impact be assumptions obligation Commission. expectations, results materially that filed we estimates in may forward-looking that our statements. those are assumed forward-looking and the higher section of revenue our reflected do have unfavorable the intend may conditions cause differ in global from fully as & differ our in and in that any Important our Factors than

slide for available for at in also measures information those include to the definitions The provision turn is We today. the now non-GAAP safe applies over your ahead. to those today's presentation With will we call, the to slides harbor prepared said, www.hillintl.com. website slides, go contained of have a Raouf our discussing Executive Chief be Ghali, like and reference that Hill's Raouf, please call which Officer. I'd

Raouf Ghali

XXXX you to XX.X% Good $XX.X joining fee Devin. our first million rose pleased million, thank everyone, a of XXXX, $XXX results. I'm quarter XXXX. report Revenue to from $XX today you, to the morning, $XXX.X discuss topped to million first XX.X% increasing us financial year. Consulting prior for After and to million beginning $XX the period, quarter strong XXXX. the $XX.X year revenue million to new promising in from Thank our in first million and was a very quarter finish since

of X.XX. ratio profit of million last contract loss an New from Operating first year. operating of the book-to-burn resulting in in to million, were improved $XX quarter a awards $X $XXX,XXX

in and from narrowed rose period quarter, $X.X loss significantly prior the adjusted from million year's year. EBITDA net to Our last $XXX,XXX the same

X integrity. opportunities $XXX rate steps annualized fully an million. capture allow us believe our service backlog profit G&A to growth that expenses any sacrificing consecutive to actions of more approximately $X those client without level years. taken million, finally, our its anticipated quarter operational with associated CFR will aspect We to or reduce Our for have the increased over we highest And second of in at

highways and U.S., Speaking in was large projects the roads and by part programs in in driven year this transit infrastructure and growth projects. our of CFR, particular, top line in

projects, last past the these And believe X new we years proceed. are As delayed being U.S. COVID-XX-related stated subsiding. and experienced that that the we that in the light to especially we headwinds given are green quarter, Europe

wins quarter our our new year remain and contract quarters, our for over outlook. confident backlog, last outlook the rising a second of business the in very several Given we consecutive

Austin, delivering provide infrastructure port and continue replace opportunities bill. authority We authority. in of noise insulation not Francisco their and new Project International opportunity control Egypt Department in of Station for continue combination communities respect Access of Airports program, Metropolitan are system XXXX, of XXXX services project many management Pennsylvania exit XX lockdowns and on awards see in bridge related, projects for But awarded urban management deferred rapid instead, monitoring and County Transportations, project contract and Allegheny new Towers have been accelerating to new growth expand to services to our behalf our quarter for were Texas. These in Philadelphia. across first mixed-use awards COVID-XX. end management infrastructure Center over providing that of associated PAAC flagship construction in to City, the significant managing of the for were Red the awards a were we Being related. selected Marina as associated the CAP transit will McKalla with project. XX% markets each XXXX to Pennsylvania existing geographies, by federal Central services QX And in the with new and construction construction bus project services With or reinstated including the management Approximately infrastructure San of Interstate in programs the wins Philadelphia the the construction structure Transportation Line which at Being or Authority Capital the projects. infrastructure a

that starting realize we year. will associated with continue to expect bill infrastructure We this the awards late

allows market they quickly with Moreover, towards to reiterate driven arise. under professional exposure grow and profile, circumstances. diverse client us opportunities end Our for flexibility to economic the geographic market our as low-risk and XXXX. us changing by We business revenue outlook resiliency which services pivot provides and multiple model our adapt to is very environments

from We of XXXX. $XXX million, CFR an to forecasting XX% increase to XX% are $XXX million of

to guidance of XXXX range XX% thank attention, for expected million, to up That go now Financial your million $XX million, is Hill's EBITDA Weintraub, adjusted Officer. to to you $XX of for $XX.X growth adjusted I'll XX%. and please Our a turn Chief Todd, and said, EBITDA Todd representing from over between things ahead.

Todd Weintraub

project million at quarter the of year's increased you, million Thank coming to quarter. levels. pre-COVID last XX.X% the increased 'XX, $XXX.X XX.X% in quarter Raouf. in $XX.X reflecting an to million Revenue $XX.X quarter, for first million in CFR the first in to in $XX.X from compared activity increase

million majority in or in quarter, Pacific million income revenue revenue and Middle million profit generated last SG&A our $XX.X region, of was revenue from the quarter. year's in $XX.X of first then of followed quarters, $XX.X million by the $X.X of and $XX.X in and quarter. the of our or noncash XX.X% improved million total XX.X% 'XX Gross For Europe the last to first Africa. Included Americas, million year's X.X% East, from Asia SG&A $X.X 'XX respectively. rose first nonrecurring expenses and total

expenses, to first gross decline our ensure managing in XXX% as profit last million slowly profit, which This million quarter were continuing commitment noncash for gross XX.X% quarter. and of to nonrecurring or $XX.X in year's first these percentage reflected compares a expenses SG&A costs $XX.X the of to profits. in profit of more Excluding expenses gross or in gross

XX, last to to compared loss $XXX,XXX Adjusted for Net of As adjusted improve per initial net share to June adjusted of CFR in we an $X profit, second expected $X.X last $XXX,XXX from income or quarter $X initiatives. adjusted our to in to G&A run in by in profit are ending $X.XX share for the last $X.X ago losses $X.X and these Raouf higher the the and improved were SG&A of 'XX. operating profit $X.XX quarter driven primarily improved current adjusted mentioned, year's improved gross first growth Adjusting from by per million the of our workforce $XXX,XXX year have from reconciliations income to certain or from quarter. first offset our is figures to efficiency. approximately quarter. realized an of parts up period. included loss $XXX,XXX release. first expenses basis, quarter of million a operating achieved $XXX,XXX narrowed increase the first expenses year. rate million the million million, Adjusted press higher loss net reduced net by utilization in realigning 'XX of loss currency EBITDA which the annually, to $X.X impact for support be an million quarter improved by 'XX, Operating foreign On to improved in exchange from year's The and operating of These

total $XX.X and cash was activities position March Net operating liquidity 'XX $X.X was at million in cash unrestricted $XX.X XX, million. million. Our used was

$X.X with quarter year's consistent Free first historical improved activities operating in is significant note quarter year. quarter collection negative is million has for $XX.X was year that last -- first It's from important for cash the the to net cash the of first cash improvement of quarter typically. first quarter. which flow flow in cash of our $XX.X a million quarter of free there million performance, last is in in used use lowest negative much While cash cash

XXXX. do flow first positive to of With remainder we behind the generate cash expect the us, quarter for

XXXX the on the will on quarters loan We We term XXXX. the X% on at X%. of facilities revolving fourth revolving of facility term have the loan facilities credit will November fee the paid maturity and by on extend to X.X% increase amended these our and facility main loan revolving end XXXX. facilities X.X% May The the and additional term to of to a the third an interest revolver the spreads and second, both of pay and

the backlog to from our $XXX.X our positive XX, quarter, million consecutive improving million As Raouf 'XX, noted, book-to-burn December total quarter. at for during $XXX.X growth reflecting the

followed backlog March time, backlog now XX-month a with at perspective, XX%, by remain Americas and region, back Africa in I'll million. Europe. your Raouf. very turn $XXX concentrated Asia was the geographic Middle much nearly From to and for our Our East, XX, conversation Thanks the the XXXX,

Raouf Ghali

your Todd. for I'll call operator time today. you the the and questions. Thank Thank to open to ask you,

Operator

Instructions]. [Operator

Our from Enderlin MAZ Pete with first is question Partners.

Peter Enderlin

past of You -- past even. have had in book-to-bill than ratios X.XX the recent more

is. infrastructures in how there you with wins cycle? to so in start that the wondering Were could somehow were although question more beginning point strong, that a delayed that's fairly that about at just have sustainable economy to And that's I'm this flow the gotten an

Raouf Ghali

the Pete, prior and much had book-to-burn fourth right. We've other quarters in quarter and are that. higher you to

typically, quarter for sector public the slowest and for of bookings, of business all, not just seen one it early your the public first of that's is time question the answer is really the because for street. our But the usually sector, with bill most parts infrastructure hit bill, our the some However, first during have procurement to any the year. of awards yet the of we out on infrastructure coming the takes the

down this the I awards through burden part twinkling the year. governments. happening We're think administrative potential expecting state seeing federal the really and to between later the start towards it's of

our I earlier. during think call I mentioned that

Peter Enderlin

then to book-to-bill And would a been show as have significant way them I for any Yes. in question the understand account Right. up related which, cancellations, is, ratio. that you there the reduction as

Raouf Ghali

We've absorbed end. other cancellations. now. not to adjustments. that, not minor had and contracts certain had as an when fully We've some we any we cancellations or than usually minor have any contracts some sometimes orders coming not But -- task major adjustments the do they're There's had are

Peter Enderlin

had Okay. And ongoing mention in some and of have level reductions you did SG&A. the

level So a next? should how what year sustainable amount that for and think this as about we --

Raouf Ghali

more what weigh is think mainly -- have say, a on they are well looking as let the I we've temporary. sustainable and was I This I'll we're taking sustainable. getting to our it utilization, are What to doing amounts in add it done at and Todd that not efficient.

our some indirects some that some the and or We we've we're fine-tuning fine-tuning these had really indirect staff of some things. Looking for some seen. added overhead of now elements. growth just at of And

Peter Enderlin

you level of SG&A the think forward do be? what So going budgetable would

Todd Weintraub

given haven't guidance any really specific [indiscernible]. We on

Peter Enderlin

though. past, the in have you But

Todd Weintraub

some should -- ago, But think levels. to years the any be the we on from rate. able But run of we also add we've as we couple SG&A point. as that said, guidance constantly Raouf rate current And run But We've that, we're reduce did. been put utilization some can would look A efficiencies I -- eliminate to don't better that we we're have the staff at have efficient. said, at positions. we more we you current have. I And in. got We've this to able

make to forward, we as the have to as investments well. to On going we expect go hand, we're support other opportunities growth future

SG&A us be do does sustain is being counterbalance positions that I what to able So current there really with some this without it will increasing levels. that. But be to to to think able and

Peter Enderlin

that if is, of Okay. the it pricing that might. you And about doesn't that And kind But specifically appear is especially anything some amount some I there there's competitive sensitivity. I I for one a mean, a competition into pricing say pretty an bids? the goes of business, increasing may more, pricing then business. is and be sensitivity mean, can of lot obviously, government of there of these

Raouf Ghali

You're correct. business. It competitive is a

gross We've margins. work defending We're in been Our or not gross get margin not work. just down. to the has coming been going buy

to going I think of down. coming lot there's be a work

very it carefully. are looking talents something Resources we're scarce. the So and the in are market at

best for our and we're the returns. maximum our sure make both our for to use shareholders our resources to want we putting So and clients talent

Operator

with is next from Our Capital. question Bill Tieton Dezellem

William Dezellem

like $XXX,XXX The Libya, I'd relative collect to quarter? in you is to first with the start did question

Raouf Ghali

we did. Yes,

Todd Weintraub

Yes.

William Dezellem

mean, the now were that I you future of collection? the refractured congratulations, thinking the given -- And is circumstances what fractured is that government? -- -- that's mean, small I about how total. the are What relative but to And collections number a

Raouf Ghali

has continue sure smaller said longer hard to a takes and we were much money approval contract I was and bigger matter collected Obviously, collection to of part currency got it the time this being timing. as in currency it's the the as make say. amounts in collections relatively before, of our any where monitoring collect for of we local This of being currency and other approval longer why that the the or a money. a percentage times that's and paid, in in fractured we previous certain because our situation all flow. a is currency collect process. of foreign We reason they than portion Libya The process Again, portion a contract government, having local for was that

took in every could we that we make continue headways penny we whatever sure So and get, making we to order of it. collect

William Dezellem

one project? some I be their point, to you project. mindset restart was to would mindset government's have to sense the is had you desire that, paid your the restart at And Libyan after the terrific for there think front we But relative wanting sensing on done. was what that you they are that Where that

Raouf Ghali

projects. our contractors a very month to just that outstanding before they're -- priority in have They one had. the we of but remind Ramadan, And the project, is can the an we back that already on on that have -- is amount that of now the believe been initial from debt eager you money need $XX like we there. a go contractors the position maintained I puts debt really talking to mobilizing. to were start million million we is any $XX-plus I'd just activities. They significant were projects, They It damper X finished which of their

I And more. will that sure risk, over collected And money. was a most $XX we any without we've putting collect to once see risk a we and we're in But high expecting low just in support our and months, significant million collected. that do, it's XX think make the our amount. company last the So with And that clients. we've of collected we

William Dezellem

a that fractured perspective to even fair it given more that Raouf, factor -- is with would to being that And a them? higher relevant lot that is oil government? government a And the available even have the relevant is prices cash

Raouf Ghali

The of additional and being money, the Obviously, was to the coming the a there -- it debt not and is on obviously, them. do country. that not their because, so. restart able recognizing that's allows recognized higher, It's payments to to of the this Libyan's them is payments. not priority to the a that lack cash them matter paying one to issue of continue coming of projects, need they've prices into not environment which was government for is of economy with reason oil lot debt immediately And the back believing political one they be make is and that them make

we've provide the previous within having challenge, fractured fractured but -- government a a money there Libya. government collecting was been So does a when or a during times dual

William Dezellem

questions, couple on may, please update please? That's an of provide Facilities A please. that Management. additional helpful. of I you your business, if Would aspect

Raouf Ghali

Sure.

We continue been some -- have facility by management. on results growing pursuing in the slow expecting assignments or and Africa, hopefully, it. the good whole quarter next North for Middle postponed our mainly on to were for one the X where facility management. it. East have, the X We're things of very large But Ramadan, They news we're month in

William Dezellem

luck if Well, shut Arabia was I COVID know pulling it not to where but that had it good that won't management down. big I'm Saudi that And I for even say facilities start lie? in you contract congratulations, that a does off. sure able before

Raouf Ghali

you're believe I total to And was XXX initially managing, a answer them. your believe, -- believe X,XXX yes, a had referring I there we're where schools started COVID. managing the before of to XXX, we're total question, projects school I of that we probably

our that the and closed demobilize continue next we right schools During most with All been staff. the year. of extension for unfortunately, we service. staff COVID, providing our gotten most We've now, being of have remobilized down, -- an

we So services. those continue providing

William Dezellem

about up XXX Is you the that schools? mentioned And there pick of opportunity remaining remaining? X,XXX. schools had an What that, out was the to approximately

Raouf Ghali

we'll task there's options. have for to orders going they see Yes, to go. and waiting several the out, come Obviously, an they're opportunity where

One them is us. of

William Dezellem

CFR of if numbers, remove where to about quarters. CFR, million high we the low on $XX what take first Great. need that would CFR through question to guidance, -- The remaining your so to of we may. couple kind this, at thinking anticipate per Or like The ramps that smoothness closer just throughout this see guidance, X a do And to I your you you business then a developing I'd there year. you quarter it's really or with relative don't end to that the the for quarter low if the way sequential of a the achieve end, lumpiness And essentially quarter to that to off achieve million sequentially? with $XX leaves is the see to work is, more about? end of we growth just right overstate be but look basis a your to Is some it? per want

Raouf Ghali

Usually, our And first just a of matter quarter days. is slowest it's quarter. probably the of because working

start New Year's the from down You during a short is month. drills which that with first time a January, off year you have of some February, then have you quarter, couple and holidays which the vacation public really

the quarter typically, or So is in usually first CFR. quarter weakest our slowest

cost sometimes as is because of it's quarter the the stronger differs. lot the of -- though Even and well, the vacation as your time one are not months couple second bit The same, working most makes quarters. the a than as offset -- a but usually dampens is third in working but it, quarter. more day third difference have summer strong average little difference second days. you have fourth between of but quarters that's first, day and as strong some third your the And which And the somewhere than that is by revenue

William Dezellem

call repeat? the you year Or an to the year, projects in sequentially up Do QX in grow or bill a seasonality? about said believe that normal where spite seasonality as of given QX is year will in throughout that of of lower slowing times infrastructure CFR progresses. opportunity normal of a And picking CFR the what unique this have a this see this you you've the couple level

Raouf Ghali

this aspect our think the all, I comparison is -- the is Well, XX-month CFR. unique. year in backlog is, one expected probably it's And our been that of first highest to

book we're that, hand having wins is the to burn then lot additional to same really versus in anticipated and a new said So year. Having come of expecting book in in. already the some

our infrastructure have is that XX-month the the than quarter which usually money see very it's not is you're awards, don't the I due So is slower going strong impact because the start time the the believe going much and that that bill, going the fourth our in is but be strong. bill, quarter, believe if seeing third than to backlog the be fourth backlog the going it's to CFR get you're flowing, to and some to But to to infrastructure and by. we procurement sometimes really this. we rest, of much I not

William Dezellem

year. to Congratulations on a start great the

Operator

question next Investments. is with from Tim Our Meros Chatard

Timothy Chatard

question. questions your M&A of rates be couple year the debt. there. and unrestricted progressing understanding That's debt far higher as debt maybe why related first you debt renegotiated of able narrative rates. were that at changed I and situation extended A to a to guess refinancing off I now? you into as And towards that you last cash My why that to that a where things couple lower pursue And can't then was pay guess my so might was of occur? that use did some

Todd Weintraub

of to The been been So market get have institution. would we financial have in were commitment that If was that we not did letter what Unfortunately, about proposed. a not able syndicated. favorable. terms major that, talked from what have a accepting we happened, initially

see we've within solution And extended, as -- and you different few so so put the a we'll now next in that amended months.

at cash, the levels terms now, running operating need of of cash pretty on that's balance the unrestricted In have sheet. of cash to we're we level the the much

different the we've Our and of Africa, local within Middle we're number North have a we $XX regions, East, in within countries company, because there's up within million operations. -- regions is we cash broken Europe, It don't the of bucket amongst got -- within X an there. cash and of unrestricted even have international the all

and the have operating on we needs. need and because just readily that go is dispersed throughout no to is meet to pay unrestricted that it. country capital down available needs day-to-day there's our ahead cash debt not it and working just well do the So and to fairly not It's restriction though even

down to at order So down an if we not do an that -- that. really be to we have is that the we've we're going because we're there have draw typically, is influx I redraw as to to do manage as pay debt an to do the able opportunity occasionally business level pay goes. we now and excess cash, debt But of that in mean, gotten we'll well that. cycle

Timothy Chatard

That have, to Yes. was the with color And your front requiring that debt pay to guess, Can banks line, of debt renegotiation I in debt? more specifically debt will those noticed the suspicion. to Libya my down I with moved the receivables put those receivables how those the any Libya they've paydown you the or function add receivables.

Todd Weintraub

I'm anything They're are think part I in. Libya budgeting. looking in mean not the part our there's they're as lenders to plan. I kind put the of of the Essentially, not that not not much really we add. included we that at of don't receivables sure -- really And

we're extent would think that the over able perfect see good go pay like to too. sense, that it's we and to collect down So makes and The towards lenders idea that to a and above.

There's because go to Libya to payments, international. those agreed credit -- X within the that we complicated, domestic do have to and ahead and it for we facility. a we'll we a debt. And reduce [indiscernible] the revolving extent do go bit little go get have more we So we'll ahead. facilities

down to less. that So to down we the And it much international in pay would is from with are go after the pay year. facility instance, that able the facility domestic would to anything we the look collect first Libya during that,

Timothy Chatard

guidance question In the up is And be SG&A you between will sales year, there, as it on you to at? do of is Notwithstanding of terms, SG&A. numbers do of wondering to target I us as think. hard going the $XXX aggregate look just the to longer-term of is a for times. the targets million, question to out you hit and dollar you way profit. order year. your put to And think think couple SG&A prepared best ratio And best be SG&A gross the this at My ratio in any the million look kind dollars or a rise come percentage is for back comments Would that that's which the I'm SG&A for in what's referred best? that CFR your have you the do $XXX to a

Todd Weintraub

that been look of I CFR, would think at that either, percentage profit could not because So in as a or you of consistent. I could there as we have margin But look a our pass-throughs at think percentage I gross it do fairly gross store. revenue that's

We expect remain to consistent. it to fairly be

the So whether way it you get answer. kind percentage profit, a and look same at do you of think CFR gross of or I SG&A as could either

percentage terms of should would a -- put out any say you would that's in I we what it. to the declining. a So there's no target percentage either than think when target those way we I that kind of about guidance of other be out think But nor -- that of no, and put haven't see

about grow guidance. or costs over adamant CFR whether expect, to going in to than just of to profits, We have said our CFR. of by less XX% to We in is profit very said think XX% grow gross want expect, the last our that going year you that not we're that are we terms that we're terms

continue certainly really should time step-level good to for -- before base significantly we headway by we to less within believe of function SG&A. that be period costs that. our to able a grow cost the there's And take something any having no So there's in no than up

be will percentage a overall, that the what adjusted growing We're get grow is below expect an to EBITDA than that to continue there continuing have towards or as costs when expect CFR you to ratio look change still trend SG&A by expect costs CFR at we the a to we're that to to as going to about we that grow rate XX%. lower less at CFR. in and getting gross to So that. want And don't we're we're a I driving we continue well profit, it that. But said, of we in

Timothy Chatard

Yes.

guidance Yes, low Okay. gross EBITDA your you right good to ratio. been somewhat year, to target. that's know to as to That's had that be and And about about this closer you helpful. SG&A would historically XX%. here, looking would as hit that's that profit But the get that in XXXX, that XX.X%

Operator

Private our question next is from another Goldberg, And Eric Investor.

Eric Goldberg

So and sophistication long-term the the investor years largely management. Board for And about I'm of particularly of invested the I've in Hill. equity the of I now. owned the a because X sophistication

failures in with doesn't like you align department. your billing it your last mean, ability reported reported a seemed seem to that I And have didn't requirements, requirements. meet you functional surprisingly, to fully SEC So quarter

starting now? sales in revenue lastly, is And the a equities is my SEC, failures may, of business. Do And potential behind that staffing? you And effort process, have us $X.XX concern we those Are Todd. selling So about the that for from any question have or trading and on then you that and that? Have clients? from to I the so, to a generated billing, now? started if Is question, behind second management -- the worry service sales to become contracted I us? the your guess difficulty problems client's claims

Todd Weintraub

Raouf. improvements the So two increased department. to staffing Billing and SEC in also billing regarding others leave the take the behind We've are itself. We've process identified I'll our first and issues billing for some us.

there unbilled year-to-date see to to work control. that take has being billed. in far we're It come improvement starting seen of so time the that have we takes care but through, impact under the receivables those in an of able and now. out some to So get the And back

is So us. behind that

clarification I I on SEC say know of to not some when I you're failures. -- exactly terms what need referring SEC don't the guess you question. In issues, I'm

Eric Goldberg

the a Basically just have -- didn't or concerning didn't reporting the SEC failures, you [indiscernible]?

Todd Weintraub

You're controls. talking about

Okay.

You're talking about material the [indiscernible].

Okay. Yes.

when in to put the those a since back amount XXXX, a effort And basis that, got of in that that a half XXXX, just step So back those. during XX were remediating I that perspective spent finally just about and statement, on had X-year in -- take weaknesses initially able put material of and fall were a filed wanted -- we the tremendous we to remediate we've the disaggregated to we restatement, of identified. had XXXX about little then

place a well-designed largely, work the in we And accomplish completed. is past was the except and system. During avoid was year, of material the to a final one put the that, up. been did XXXX to around enough complete was material of years that them. over of X What and control during there to of had remediate And all system that done past to the that to for work done put And was the during able more the -- execution that were ones effective problems Unfortunately, X remainder we to that control on context into in the not we we existing. we weakness, couple the have put popped those put weakness that that year consistent the to an had controls the now. led remediate found really some that the basis then have

the the place of So the works, of control throughout having That that at the it a year. execution of more to way auditor's of -- controls the the is operation in weakness they not assessment control and entire assess matter course explain all. is the than

through We're the year. it now, the we executing fourth controls quarter, we're are properly. throughout the we're first that By to quarter, Everything the no year, in consistently We the first compliant the throughout but were is testing the time quarter quarter proper and they all quarter, there did was of So the issues and in not consistent fourth performed the had the course of been throughout the year. expectation fourth we were of testing year. last execute the not everything. got now

to We any that expectation year-to-date. are continue but We haven't need testing, exceptions seen remediated. there's every we

We issued the it continue next is to year, clean on completely that. take a that when will opinion. to for And steps improve opinion be

Eric Goldberg

business, The I'm that. claims management interested in

update on So any that?

Raouf Ghali

Sure.

take me Let this one.

restricted not noncompete can And expired. we are the of As of how can claims take on last much week, has we on. -- business we our

of So needed that assignments it. have knew up from a to before already yes, answer questions, have your work even shown us couple claims we clients on and

project still claims we're project to But services differently. is bit I services, because supervision our mobilized during management have it it continue, have of management mentioned our as of big a of an We're time, already services. last a are, inspection structuring extension staff. as it, some we we as going especially part it part We and

existing business of on are we we couple with to be consultants and few come taken are it organically with So in long-term lot a have as we're in of We're that on that to talent, augmenting just do we're going for more. going assignments it starting a with lot new a claims again a that expecting now, hires going assignment. business. that to work quite and But take independent

billable. when So pay only they're

grows, And margins the business enough we going critical move because to that our of look assemble relook business. upwards going it develop -- expect are organization have and we're how We Does once to side. give the it we're at you color? as going on to mass claims a that

Eric Goldberg

To limited. it opportunity incremental investments great. me, being was somewhat That seems with an exciting like

in has the been I'm from financial of over strength? excited now company you of And about selling that. concern the position that? expressed the So process, seen an kind a Have there

Raouf Ghali

not. No, we have

at, about haven't We U.S. or clients, the whether trading any from we're in I what price stock overseas, at. calls had our levels and our concerned of trading of at we're any haven't.

U.S. particular that I providing, think with the -- can provide federal governments. in and and any local been as them as we long subs we always we've the and services and quality state

at. there's pay any that we ourselves I'm is As level or stock as time, concerns any on issues long with sure traded not our what

Eric Goldberg

a paying seem and just Has to Libya it. any and receivable talk one debt question. debt with about that done about outstanding being off on And thought there We recall. just selling the last been

Raouf Ghali

to Libya like receivables, not tell Just the talk thing. tried about one to they answer clarify I questions any I me. but

-- few where was didn't since a we're there in in particular, bringing we $XX buyers. having that can was down opportunity outstanding $XX would to flux very of there's have. million million. Libya receivable, find it started because to -- with an would So we we And Obviously, sell given at, debt, we if yes, politically. But

we're taken it to a pretty going of time hopefully I And matter shorter the confident lion's of taken and get out we're the think has we've it's than it. remainder, so what far. share

Operator

this like turn gentlemen, would Thank you. any to concludes to the Ghali Ladies question-and-answer call session. closing for our back Raouf and I remarks.

Raouf Ghali

Thank you you all very have much look wonderful with with XXXX We for to in quarter and financial your connection day. results. a forward second our speaking time,

Operator

concludes This conference. today's

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

Hill International (HIL) 11 May 222022 Q1 Earnings call transcript