ORN - Earnings call transcript Q3 2024 | Orion Group Holdings, Inc.

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Operator

Good morning, and welcome to the Orion Group Holdings Third Quarter 2024 Financial Results Conference Call. [Operator's Instructions] This event is being recorded. I would now like to turn the conference over to Margaret Boyce, Investor Relations. Please go ahead.

Margaret Boyce

Thank you, operator, and thank you all for joining us today to discuss Orion Group Holdings third quarter 2024 financial results. release last earnings our issued after night. market We Relations our website available on oriongroupholdingsinc.com. of Investor the It's at section I'm here Thanisch, Chief today and Financial Officer; with Officer. Travis Boone, Chief Executive Scott we'll provide On management your prepared open up remarks, questions. today's the will and call, for call then

begin, you today's Before include I'd comments Laws. Securities to the under statements Federal like will remind we that forward-looking

not forward-looking words Forward-looking expect, anticipate believe, statements be, and Statements will, phrases. intend, are are identified as by historical that are other statements. words comparable facts such or

financial Discussion actual of cause XX-K. With turn Travis, that, to may factors on Our in materially and condition operations like contained SEC the now by call go I'd could over are differ our vary results reports contemplated Form those filings, from XX-Q such materially statements our please Travis. to those ahead. our that of and from results to forward-looking forward-looking statements. the including

Travis Boone

thank start over morning, you, overview market to our I'll call. results it then quarter and Margaret. update, financial our cover third Scott Good conference and and you I'll Thank with our for third turn XXXX joining to everyone, of results. an quarter

few we the last to up of this higher. said million improvement $XX.X of million came The revenue fact, in $X.X XX% a that quarters, we $XXX.X in pick in first year-over-year. out half adjusted is and XX% $XX.X EBITDA higher was in that expected this third million the than momentum million, EBITDA the year, back did adjusted half reported entire and Total quarter. we strongly year, play the the For in in at

contributed and Bahama of been Also, ramp-up the now growth of projects, summer began line to was number by project top largely the strong delays our Pearl that a quarter. the the Harbor Grand during Our have projects resolved. that driven

Our can as quarter scale level business of our generate demonstrate profitability and results the third we grow.

million to in fourth adjusted million won October which XXXX, $XXX $XX $XX we're would $XX in range target million the to the XXXX. We greatly in the year, contract of full the in deliver in quarter. exceed for start new on EBITDA For reported million will that awards

few recent our of a wins. Here's examples

First, Marine bulkhead of the the a Turning quarter in Bridge months begin slated to the Transportation. State for of will Houston's The Basin Wharf middle expected was through an won Department USA trestle to to and is construct $XX.X Bay temporary XXXX. In million were subcontract North XX we quarter Portage repairs. Concrete This start first for of our $XX.X fourth for of Port awarded of with business, approximately run project the XXXX work Harvey to contract the Builders phase. The the quarter will Skanska for XXXX the in duration XXXX the for approximately and a an extend Washington in $X.X Woodlands, of subcontract begin is the awarded Texas. construction Ritz-Carlton a fourth to also million expected years. million We project for the Residences X of X fourth is

completed have win working Our data data projects. we and center on center now business projects. continues to separate deliver We XX Concrete and are

placed over have projects. of We on revenue for a these of $XXX million yards total in XXX,XXX cubic concrete

XX pursuits. working active currently are We

industry-leading data center safety contractors, on with success and factors Our strong relationships all strong our key performance contributing our general our are to projects. record

safety for performance Excellence awards Bridge Award Insurance Mutual awards, awards business. Society Causeway across our Liberty the General Company safety outstanding of the safety and the including Award Safety Associated from exemplify X Association These NASA project, to Contractors Transportation the recently have We of Gold received the Houston. Safety commitment our Concrete X American awards from for Florida Contractors, Builders several industry

our Currently, incident indicators leading X,XXX is have TRIR, TRIR over is this from far industry completed the and site X.XX. year provide so occurring. average construction October. to rate, through in around X.XX recordable The teams total prevent or observations Our incidents

our every day. and at committed safety, safely of proud going of are performance we We on are to end people the our home

pursuing recent billion focused in XXXX, opportunities. The are us excited growth. the about large our deliver we're that our have transformational and that year for in people pipeline actively people are of will when ahead. and several accelerate hit diverse growth be equipment that we're Southeast expect see of of projects to opportunities see been significant preparation year, quadrupling growth. investments we XXXX capture from ramp beginning last and the we we will projects project pipeline the this In With markets our the the up on and We see We to numbers help will confident hurricanes revenue $X coming, making in flow volume businesses. large devastating but

to these healthy Our condolences very Florida. In We a equipment several resume quickly, very our on picked impacted only to our had minor are people, have and to to all have projects business. We're able and projects. those by we storms. across work up emergency we in repair fortunate projects our closing, were impact

at margins. delivering higher are We

We improved cash have our dramatically and liquidity position.

we and years. a the strong have trajectory growth over coming profitable, are We

the Our talented people build market opportunities company to excitement extraordinarily and our all to and are commitment their ahead. in united continuing capturing

review Scott our Now for Scott? I'll to of financials. turn it over a

Scott Thanisch

everyone. morning, Thanks, Travis, and good

last increasing year generated EBITDA XX% adjusted over revenue million $XX.X to to Our third XX% and million. $XXX.X strong quarter increasing results with

revenue Pearl one quarter, Marine year, had the mix expectations ramped and for up for quarter fourth last in XX% shift revenue As and we combined to also decreasing the This into quarter, accelerated indicated earlier with above we Concrete projects that X%. QX. revenue continued to results was deliver of our our QX. Like up Harbor start third this Grand slated the project and Bahama the

As we've said, that is the focused Marine work. intensely immense, and we're winning opportunity on

$XX.X XX-basis up the that or attractive share Our to fair $XX.X bidding projects our $XX.X million, same The increased up million consolidated margin period. gross year. but the line, of segments. in quality pricing top quarter primarily million profit Concrete gross margin segment revenue revenue, were margins. Consolidated on disciplined expenses and winning standards of both point comparable we're last in to was flat period of from was relatively due $XX.X meet XX.X% our execution of SG&A in third XX.X% from the improved increase or million in

revenues, of of XX.X%. a decreased dollars As increased addition total to business expenses to X.X% percentage due from SG&A contract legal costs compensation, SG&A in expense and initiatives. some development onetime process improvement to

third Turning $X.XX period. net prior million income to million Adjusted to diluted year per $X.XX in or adjusted $X.X net the profitability. income the compared of in share or $X per share quarter diluted was

included items $XX.X and the share adjusted GAAP quarter EBITDA or million. quarter third million million net the income of was for $X.X adjusted net diluted The per income $X.XX and was EBITDA $X.XX third third $X.X was million $XX.X about share. XXXX quarter for diluted per of or

Our margin X.X%, from last adjusted EBITDA was up X.X% year.

year, margin our Marine X% was During segment quarter in compared last the last from margin the the in quarter, X.X% third EBITDA adjusted Concrete segment year. third in was to and EBITDA adjusted X.X%, up X.X%

our at projects starts this segment. Concrete efficiently margins. have starting good the to the Everything field year. better our segment Marine generate the reminder, margins. winning margins since project and returned low Concrete in to single than teams our pleased better is progress jobs the point, for to on been goal a with With adjusted business our of new customer with last practices double profitability digits high the more We've our EBITDA As implemented and bid they delivering EBITDA right with digits focused for

Our our Marine segment executed largest with projects. as well in activity well quarter on the in significant increases

$XXX book-to-bill the quarter, X.Xx the quarter. bid In on This rate we a XX.X% opportunities, to in of contract million of weighted of resulted worth billion third a we bidding won metrics. for which in and Moving value approximately quarter. $X.X ratio the on win of

third As was September $XXX.X to Marine and our quarter $XXX.X segment. XXXX. XX, was compared Breaking million at Concrete XX, in backlog June out XXth, our of backlog, million million $XXX was segment our at September million in XXXX, $XXX.X million and $XXX.X our

at saw of $XX.X XXXX. We working the now negative and delta project cash This generating due compared flow. flow reversal operations during reversal cash third the mainly huge from of QX, operations producing flow to was in $XX.X million is Hawaii from which Turning the business cash of on this cash the continue required investment generated going forward. a in of million quarter cash. will of start to cash to and most Hawaii capital the project, The

During a in we balance strengthen took our secondary offering. to million the quarter, raising steps sheet $XX.X by

continued our proceeds capital repayment of We general are under and credit now the and we'll use better indebtedness purposes, capitalized corporate the for agreement. working

our revolving million, needed of had will $XX.X in We million facility investments quarter debt the the also outstanding no at equipment $XX.X to the in was Total cash. optimize demand be We we going under with third quarter. ahead. borrowings making outstanding and opportunity ended forward end credit the

property anticipated in Jones September sale with interested not Our due West of due this remain We the buyer's did engaged diligence. parties. close East can rates, and other in we buyer to and right flexibility With delay cash declining the the business, us a time we interest turn gives growing stronger our strike this and balance sheet into and for valuable believe our deal. more asset liquidity to as

$X.XX XXXX, to in to and our the million in shares on the translates offering, EPS from adjusted to deliver $X.XX $XX to GAAP adjusted of expected of with this $XX the target for $XXX year range million, revenue positive EPS. we to are negative and of million $XXX For million $X.XX range the to full a EBITDA additional range for $X.XX secondary

we important enhance our productivity. and already have for XXXX, company's will that we efficiency As initiatives prepare some executed

This serve of through the and a hired coordinated group. by we efficient quarter, and resources. materials for of created third the economies will our procurement whole individual more procurement newly During company leader scale achieving

business. same for provide our is new also of that with to we've on migrating the go of few entire line projects We our segments platform, We've the January our to greatly These of information largely our our year projects, live across will into the phase now new tools financial to business in sight testing ground. new the improve IT the ability can and on effectively so and and insight manage Over projects. plan handful processes start been been we improving will operations in share these last complete and systems. quarters, tools implementation which This the a office. back the our implementing our progress

provide questions. to we for when We our plan our March. With that, and outlook are the call XXXX excited year in open up report and the year-end we'll for results prepared for

Operator

Our Spychalla with question from will Aaron Craig-Hallum. first Instructions] [Operator's come

Aaron Spychalla

that. to I hit the you bit could sounds on hoping to was a here, quarter-over-quarter. the exiting just start bidding Backlog a It backlog. little Maybe first with give little I year about bit can but me, the environment? like little a on see talked the you kind know starting market, funding you've just bidding higher down you're for of more up pick activity was elaborate detail

Travis Boone

Yes.

strong. environment the So steady. hot, bidding has been but been say it's it's I holding strong, wouldn't

tell keeping for awards. pursuits from throughout our got It's they're backlog been for -- As first several backlog like look steady you quarter fairly a fairly -- we've can the up big the lining we've backlog, year. that

fairly So it's I up looking for few like a quite said, And lined a then steady year. like XXXX.

generally good getting stronger. So and

Aaron Spychalla

update Navy And on how the particular, you coming an what about the just there on thinking then in you you're years? maybe can here look like in opportunity progressing, that can for just give that us

Travis Boone

big Navy about out we like we're rolled of for. big opportunities of opportunities the thought up congressional Navy Pacific. in there out. Sure. bullish ago, a funding the Still It lining Lots pursuits looks the way with would XXXX. year that couple in be A with there very

those in XXXX. of be later Some probably will

far years think over be in -- said, looking as I the opportunity 'XX like -- opportunities very as at there while likely X will that I late or opportunities, pursuits. So still big bullish more. big Navy The about for next the there's we're

Aaron Spychalla

well? you we me for Can as equipment All it year And as of outlook are about look the to XXXX kind there towards talk and last about capitalize just of in you this look right. bring opportunity, thinking for then Understood. we maybe as kind on how more this to on CapEx.

Scott Thanisch

we been our in drive will that We've our equipment could on think in some few items. acquire we ways at a eyes looking future and of Yes. which the have the growth

to complete we're I the think got ways do good near that. make to strong very for to to We've liquidity looking be term, a balance can find those ways in sheet and if investments. now transactions those right going we

CapEx growth. we spending going So year that we're our drive anticipate of as result increasing next that be to to of kind into prepare going a for

Operator

Our from & next Julio with question will Romero Sidoti Co. come

Julio Romero

XX on XX maybe you to reference post-COVID help that date, compare centers, that bit. figure the a completed or are kind to of if data data of year-to-date? center Maybe periods? to to could frame start Maybe does separate of Is on side, you mentioned specific Concrete working any frame projects you that how us projects. And prior

Travis Boone

That's been ever. in we've than working the over year, probably Yes. years. that number have or bidding them, a couple more this on so. last though, we've of been worked number on And large A X the total years and of last

been it's starting kind rapid of of honestly, year. year, don't So but the them. a I a last it's been quite pretty number, increase exact few for know this

Some very been of have them large.

them partners states who the smaller think, other but those us We've Texas, XX in North right of side. into Some going in are asked also I of follow them now. Texas, outside active been Most we're to got, have have on where several key there's other states. pursuits with of

center So is the the data of pretty on hot. things side environment

remember, that XX. we You I at ago, were may months said X I think,

X there's in last been added the So those months. of few

quite it's ranges the center And So vary the size heavy on been side. data significantly. active again, pretty

Some very are small, some large. are

Julio Romero

Got you of in did that it. ask I and the there. was in Scott, third continue I about generation to think XQ. cash wanted helpful mentioned then Hawaii That's cash due you the impressive cash to And Hawaii much that really generating flow quarter. should very

you that to how of the kind how quarter? just do out about be for So cash Orion should expectation, in flow we given fourth thinking shake overall --

Scott Thanisch

Hawaii quarter well. as on of up Yes. great that We of and some did kind have cash timing revenue a the it flow lined

still that out cash I flow We the in quarter see line finish same thrown generation but So year. the project. the continue to as we're going the Hawaii won't on cash the see off cash a generating think to we fourth of operating at third nice levels quarter,

Julio Romero

then on you be And bolstered for is just a of little sheet. have staying cash Excellent. would a me balance one Okay. last bit kind

about growth You strong some CapEx generated for you cash, deployment really and your about talked earlier plans.

us If quick near us versus of and there. how just allocation growth debt versus about just up size give you overall, thinking could that capital on of refresher term the in of kind a repayment kind kind you're for other

Scott Thanisch

Yes.

capital after cash to that about we have forward. the third the strong be obviously, structuring balance So stronger in offering sheet we've that we're with the thinking the quarter, we ought secondary flow and achieved that the our going ways

now debt is net Our right X.

forward can move that we that that our think as the that agreement and can a pretty we to lot how in future. potentially able think play forward. line with put and top see I for to make So And the better think to be near it to us earnings going to We talk flexibility into growth. We we money about we credit ways existing our have opportunity suited need that, position to the faster. do good move that's balance drive give options equipment modify of hand about a improved the the we to lender stronger sheet to we we've got

flow we that's those and to to need focus. our primary internally investments, So cash drive we want the that generate

Operator

will next from B. come Securities. Riley question with Cho Our Min

Min Chung Cho

negative any impact question Wondering talk assuming Can So you a negative kind hurricanes. about I hurricanes, Florida on the from any if margins talked to or potential just you positive on some more there's your I'm Concrete XQ. impact but emergency the post business? in specifically. of your work that's impacts know about

Travis Boone

was we last south, I our business. of fortuitous hurricane -- We the a and teed up No. turn on the to was don't kind slight for made mean then anticipate were Tampa -- which

quite spared yard our we our and were So our our frankly, and to projects. and major people, impacts equipment

pretty our some I deductible while a it yard. -- minor over, had, the of mean, for impact. We in that days a very was And after storm. type was I our the were little bit had back minimal range. kind of storm even then of pretty in preparation shutdown get damage there minor right stuff. insurance roof we to and damage mean, we didn't So And able to few was a meet work

right able fortunate to again, to pretty So we major And work. well. get storms were to people back very X escape

And the so area some the Tampa kind help been jumping we've that our for it were -- None then huge so. them was in damage And is Bay helping them. some there and to of in help them customers' facilities but us. good our major customers to in of to time are us, with able of need of to specifically projects, in important

Min Chung Cho

hear. to good That's

pipeline increased kind that Just the kind the center reiterating case. to make opportunities wondering, of any you're your of around I billion, if seeing mean, work. on $XX like still opportunities, sure it but sounds just you're was data And I of especially wanted

Travis Boone

center up. coming Definitely, like I is work in. The pick as data hot continuing earlier, more and work is to there's every pretty center definitely the day, said data

definitely know As it's number our the exact holding far pipeline as $XX strong. don't goes, I it's what the billion-- is, but

Scott Thanisch

Yes, $XX around. billion, billion $XX

Travis Boone

range. $XX billion, $XX billion

So good lots opportunities of next couple the up of years. for lined

Min Chung Cho

outlook. final in of Okay. percentage as in Any you're mentioned well? equipment revenue Perfect. people guidance in you in in It and sounds we expect a investing dollars investing as as XQ and just of XXXX question on looking kind your should CapEx, then well. of like out terms into SG&A definitely a or And what through

Scott Thanisch

Yes.

then a changes in in systems figure similar the kind quarter dollar quarter guidance we year, what to the we'll to you give as fourth third be to little that the our next then expect it and going complete And like. that in about We be at into of as was should then looks what more process investments level.

Operator

will next Bumbershoot with Holdings. Jason from come Ursaner Our question

Jason Ursaner

last recently me Series thinking of It's had famous World end growth September a and night, the like Field just Jones was will It that in about away in come, speech. Earl Travis. the got Dreams passed -- was it just rough of James

come your Pacific, Going Gulf, to can't they for to fathom. the But money. being so turn doorstep, up give even to serious. reasons the the you They'll

Travis Boone

come, them, tell will they right? you If

Jason Ursaner

doesn't market. demand well, But credibility and execution do expertise. the the so Yes, is I it I side pretty this think people, to to the seem any in ability equipment, would and desirable, kind and jobs, down on rare the the like the bidding contention real seems be coming longer the term, there's which question of say, to

is decade, the the next you assuming what margin the next are into going what's can out sounds the laid that, confidence will your it still metrics even that's or you the Marine Or segment? the and guess maybe of year level giving capture that maybe So today? translate to particularly opportunities ahead profitability some in confidence sitting previously laying here like or longer. out, market that I for you expectations be

Travis Boone

and anything, and unchanged. it's higher year about was to our confidence and My and capitalize improve confident of it our I it the performance we as a continue our ability is feel grow. and to really kind market If capture scale margins our to ability ago. than business

So for things. we're some headed really great

the the as can. of construction the lumpy slow half second to can on how from first -- where one and year is take been out we be I have the saying concern opportunity way, think that every like capitalize that's I but opportunity playing to investor it thing really some come business they this of there's think and things we're a -- there's going out. said half, the minimize like is, go And downside played a but our a bit are side, and and right? We've would, one a every everything some we it's when from didn't a and we things we this year, beginning quite things big exactly going

this can about good think into capitalizing forward I looking to the and really and building on what forward company it So potential. be of things going kind we're feeling

Scott Thanisch

operational ago. and bear think is really win our continue. years And fruit, to improving drive than just a this and different I it the Yes. go investments ability it's And we've excited work company and business, pay the that was see to that in and we're X improving off starting to made performance

Jason Ursaner

guys the scale? trying certain quarters, have I'm at what Marine level of And segment was you terms a target -- some the expectation back on just what remind of at potential in communicated the kind go there? to maybe of margin what

Travis Boone

we levels EBITDA of we target we've scale over that expect $X in the the The be Yes. business, low of see the to kind margins for near about, that Marine billion at double-digit being as revenue talked future. the where

our that's kind operating then more to fixed you once of we'll and get leverage the you see So that get over spreading size those in level margins. when costs from projects,

Jason Ursaner

Congrats on nice the quarter.

Operator

question-and-answer closing there I the appears conference Boone It would like back This remarks. are further Instructions] any concludes questions. no to session. to Travis our turn [Operator's for over

Travis Boone

work weather spending, other for Thanks. of joining this I for the to call and elements thank our hours out different a lot take Thank today. their in want and a enduring our to factors, all of you things. and working employees time lot including all hard

So us forward thanks guys And stockholders day. next confidence in look to We you our believing with employees for speaking thanks everything they what for our of we quarter. again of do. do can all all in to and to every having

Operator

has conference Thank concluded. you presentation. attending for today's The now

now You disconnect. may

Orion (ORN) 31 Oct 242024 Q3 Earnings call transcript