LMB - Earnings call transcript Q1 2020

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Operator

Greetings and welcome to the Limbach Holdings first quarter 2020 earnings call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation.

You may press star, one to join the question queue. If anyone should require operator assistance during the conference, please press star, zero on your telephone keypad. pleasure your my Mr. now is to host, introduce It Equity Jeremy The Hellman of Group. you begin. you may Thank sir,

Jeremy Hellman

Thank found slide much, results market on Holdings March reviewing announced also Form review be With you company’s Slide company’s the can Holdings, those afternoon, may the for conditions. statement presentation XX, Investors The over its the presentation Yesterday very XX-Q Officer. to The call. providing company refer XXXX Financial the The that, and XXXX. Chief good results earnings on Today, of company in website first call Limbach the will and company to section quarter and current this Jayme presentation. quarter disclosure the and accompanying turn the its everyone. filed of X encourages a ended the morning Charlie Brooks, be www.limbachinc.com. I’ll Limbach of update at Bacon, an everyone to forward-looking CEO

Charlie Bacon

our joining we’ll realizing The liquidity, our and our commenting of for forward. including on first restructured update thanks coronavirus, units and strategy going an our us. quarter team. the an everyone be recent update off closely an team the metrics. business key of Today substantial Welcome results we’re with I is by on and improvements leadership in working of want start impact to on providing the overview all

company development Jayme cover year shortly. several typically a will and that had and to We have what later to details, On of considerable remarks. which for weak tactical start in quarter the momentum my I the deployment behind solid the strategies, continuing detail the a is in seasonally, all while broader and discuss execution further of in I’ll we

XX, where virus we’ve Before we May our first Since had those with markets ability restart to activity last conditions me speaking let on graphically the work. you which comment on experienced of do, construction we’ve a in Slide market on summarized X. broad-based current though, impacted

our of in Our Orlando is cancelled, shut but into Boston later England Boston individual May. impacted pockets mayors of customers, meaningful None shutdowns last those a to projects The approach. the of project in rather New New proper. of that work project activity will a market been isolated portion preference local been has cautious substantial projects England, of to most in taken and only construction heavily number we timing branch, to right, activity had have limited were of pushed by the of shift where however more week was and Cambridge Outside any backlog suspended down was entirely for reopened largely on project which revenue some the where Disney our of limited experienced depending the a the periods. have market

Disney pour deal restarting with remain session at the point. to Disney virus projects had discuss attended this work to projects Our and suspended a protocols. those We representatives safety with recently

of this so last to activity also activity or to with a service or segment, in pre-COVID we’re more limited back activity expect week We state so, exceptions. few before construction the project less in the long, pre-COVID to at resume In levels the segment. too returned time has

to have special we ready For example, July are small on that in restart Ohio a of projects and projects number X.

work expect may into winter. projects the there completed, and delayed maintenance be be these push deferred we to As or fall some work who owners although with and construction, service

engaged number with engineering issues and the report our innovation and on is in to by by other company these inside of indoor customers increased on and discussions The the notable being other focus are design driven controlling an circulation improving A led air point related flow group. environments. on groups

from ranging importance had office and granted, We’re and warm that exploring a environments air to which the what is design come solutions of The facilities of and the movement which reinforce has take to amount of challenges to and to many elevator great stairwells. the in us proper served summer cabs student to for virus these in in us time. the functioning throughout facilities winter keep systems we of that spend of in cool

continue an for innovate leveraging our and Our we’re is of business business customers. to essential all our capabilities to

employees cash we’re As these that conference making since late as areas get and to their stay in proud efforts execute strong of get continuing so still They which organization much all to of challenging call, I continuing May implemented I’m too. priorities the many progress are in work mid-March, safe, we well have manage in our noted as Limbach and very accomplished to circumstances. under our and March, other

We’re other to and grateful of quarter review have our first of employees Limbach earlier. our on let’s family, that the and has I performance COVID-XX minimal, seriously. real-time none as incidents that, With within few Very move been stated updates. sidelined, been

Jayme Brooks

in the first me on which three filing. for XX, Let months re-casting are our quarterly current XXXX, of the reflected March results ended the comment

retrospective to recall, XXXX reflect quarterly filed XXXX re-cast quarter adopt XXX approach. properly were January of the ASC Since numbers XXXX we the to obligated beginning the for As adopted transition before the our are new in both you XXXX quarterly two our each first we for results fourth X, annual these periods results discuss as XXXX re-cast. today the and after to we may during we new end quarter required of Topics we All and using a quarter quarterly XXX are XXXX. standards two standards, at modified

period filings XXXX, results the the new quarterly we remaining comply with two XXXX all standards. be will comparable in to re-casting For quarterly

progress sheet in continuing and in reflected flow on had each quarter, I cash quarter year flows will XXXX. may now full fiscal there With While change balance or certain first improving a for comment quarter line no on reported categorizations previously management. is impact results. items first our cash execution, field and results that, solid generation, that We

Caesar’s our comparisons in due historically consolidated on quarter first a first outside from final achieving Pennsylvania part been project the year-over-year. In Also, of increased recognition in the a to million the X.X% broad-based perspective, year-over-year. has Western all of weakest the right-up, revenue growth, income quarter, comparable unfavorable year’s quarter performance net Absent is construction Michigan. and so breakeven appear quarter seasonality certain accounted in more core that a of right-up first operations. which Arena last was positive is development. Little for of mid-Atlantic The $X.X year-over-year The segment

in another several that material in a will As branch we this discussed be the as quarters, market Western and plan executing there to focus previously, have the construction projects region not business revenue and at the exclusively traditional that Pennsylvania, In turnaround is profitable for time. service however opportunities in growth past. continue we and on owner-direct we successfully execute are managed to not mid-Atlantic anticipating we unit any

keep different As in concepts. the segment, service our that we discuss and in revenue please mind are business, sales

and a is will it as to generate then a we and backlog, customer project We into book sell project executed. opportunity revenue the

Operator

by. Ladies and gentlemen, please stand

conference for and thank you will gentlemen, Once resume Our again standing by. ladies momentarily.

gentlemen, resume please will continue stand by. conference and momentarily. to Our Ladies

by some difficulties. Ladies continue while experiencing and technical technical stand difficulties. are we to please experience some We gentlemen,

you gentlemen, your momentarily. Ladies patience remain will the line. please and for on thank and conference resume Our

and be for We your shortly. Once difficulties again, remain thank resuming please will you are experiencing patience the some technical line. o but

difficulties our some be resume. shortly. experiencing conference but now will are technical will Ladies We resuming and gentlemen,

Charlie Bacon

we understanding Okay lost you where Operator, off. sure help what we not not with can I’m happened folks, but where me I’m connection? sure lost there, connection. our we left the

Operator

and one gentlemen, stand moment. for Ladies please by

Okay, we will now resume.

Charlie Bacon

bit. we’re rewind Folks, to a going

to back it to details Jayme, Jayme go to where quarter, so explaining the with back of the going We’re I’ll started that, turn you.

Jayme Brooks

The quarter I’ll that a and with a quarter balance year’s core execution, right-up We first breakeven quarter of of due seasonality Arena unfavorable the million Topic final Absent to historically recognition our quarter Little $X.X achieving I through is comparisons perspective, in development. Michigan. had the first cash year-over-year right-up, positive quarter on has Caesar’s project progress generation, in appear the improving solid flow that Also, our been part you field but performance reflected last and certain income million consolidated segment weak and of Western is Thank for won’t start I $X.X from sheet XXX, Charlie. net a Pennsylvania so go the continued a accounted all management. mid-Atlantic first ASC XXX of quarter, operations. comparable outside The year-over-year. which broad-based increased more In construction was first growth, the revenue results. year-over-year.

mid-Atlantic several quarters, as opportunities be anticipating we the on discussed and managed turnaround however successfully Pennsylvania, this the business executing market that in are revenue unit construction not projects in traditional In there and profitable Western growth at for past. that to any continue execute service region the have in not branch plan previously, will owner-direct time. As have is and we’ve we to focus a exclusively we material

segment, our mind and revenue please in are As concepts. that we keep discuss the in business, service different sales

will backlog impact was our second March more the was and project opportunity a is a executed. Revenue quarter. T&M in impacted that across first was generate in weather first from all than and the then of customer geography half flat in the book service work COVID-XX, sell into mild project which the it and We usual to of project some and revenue there quarter The as we some activity. segment in

XXXX. special decline sales project in a fourth and We of also experienced late in quarter small the

sales which however markets in shortfall the service felt in short an see of of in first the most was work, is year’s sales cycle encouraging the first type we this quarter, did Given sign. impact this for rebound sales segment the that in revenue quarter,

the still gross on more As see year right-up year-over-year. part and to well operations sales the both generate several as and year revenue second we’re than Arena this from levels you likely Little evaluate March impact profit. weeks of and the quantify last however year COVID-XX the profit The over were quarter, gross this year more the weeks two margin year. recognition able that service due impact fully lower to in and can Activity on pronounced in away of of is XX% service Caesar’s impact declined impacted Consolidated revenue. as year project increased gross ability COVID-XX Slide being our our the of to the quarter in last late this in from X,

incremental the certain or of modest several make earlier. in suspended from out declined progress California Despite margin That months XXXX. a write-downs projects much any quarters believe margin the gross of in several won’t challenging improving and fiscal virus XX.X% impact a delayed to in we a mentioned year. lingering $X.X generated from in-process next making Adjusted $X.X in current to up having to of and in for last represents period that It end of revenue expect we improvement approach pushed may XX our basis however, million the accelerate prior year consolidated cases. this Nevertheless, the quarters year was that Limbach disappear. over the completion, points work previously year profit Importantly, revenue as gross Southern execution. we’re get substantial million of and the EBITDA as result the market will gross consolidated right-up up

we took XX. operations, action by initiatives broader on virus We’ll occurred in and the of to well as response the the March the as headcount reduction in costs While savings progresses. those to statements reduce cost projects benefit year reflected in and financial were not as late the the those those aggressive fully savings actions quarter see of the impact

salary revenues, SG&A service At costs to to March. entertainment and million which $XXX,XXX end same included $X.X salaried added with year increased to whole, the May XXX, our total primarily payroll relatively related severance expense approximately took increased end due in expense additional to headcount of from of reductions million costs, rent, due total in the XX, XX.X% a incurred travel headcount and as the year-over-year headcount that was quarter. and offset salary conjunction segment professional place reductions the was and decrease a and by of As XXXX. Expense is year XX.X% Higher payroll prior $X.X services. the

risk contract to expect we be quarter, and on activities. minimally started the Finally, commissioning, LAX third it Midfield which of our project staffed. and both By on-site up with the continues force low labor is are systems wrapped to

Charlie Bacon

which on million, was construction provided handful Slide segment. key we attributable XX of our performance was X, million backlog March Total of a Also $XXX.X to at $XXX indicators.

largely decline no for concern. The markets our backlog current of items. a year, of and backlog sold in December as out or planned levels below close function carrying XX While March last XXXX. to we’re current XX reasonable We backlog year-over-year most is and of was it, the view of level as fiscal XXXX is healthy in the capacity backlog cause for for and three

our projects backlog XXXX. quarter in England into First, first operation booked the two larger of New

England sold New is revenue XXXX. construction project for in major out

confident with are that and taking matched Second, next as months a we’re we XX the approach capacity we’ve conservative to generally. more I mentioned, opportunity XX to over sales

made which projects intentional Third, an away have profile. favorable risk a larger pivot less markets we’ve certain in construction from

shortly, to while continue time an service we’ll discuss continue detail owners. should at expect directly As in projects we in this further to smaller construction include performed the will same increase which backlog trend we see for

in impact first activity managed the quarter year, England New reduction Beyond and the of Southern sales of new we sales the orchestrated of large in project California Tampa. in last a

the the similar were operation. to in we risk California reduce transition intended successfully Southern to in operation, and we while mid-Atlantic executed actions management the stabilize plan Our

sold Tampa quarter. to over than Our When new the quarter, segment in the aggressively year. Sales the not actually and across pursuing expectations. increasing the year out largely planned unit internal of compared XX% company, more in first strong through was X% year first ahead business service nearly were work the we’re sales entered

construction internal the impact. we also in construction both With respect sales to segment, March expectations XX. substantially through COVID-induced in ahead service, some As sales and of experiencing are are

to on continuing pre-construction to capital quarter operations. proven a result We’re overall temporary engineering we’re should appear moving projects so branch we in be of more to of remains are number seen construction substantial in new I once witnessing the backlog significant a whether a work second solicitations of yet project trend perform executed. not projects several more delays indefinite are forward, in additions deferrals through be note future and which to These pattern or should contracts around caution investment. it

and on have to manpower pipeline overhead adjust of based our and We accordingly continue resources activity. will

redirecting market, a we branches where for happening we not owner-direct what’s and to resources also reducing made of sales construction service services. and to are owner-direct We have the our opportunities Irrespective decision rapidly our expand in several resources in will strategic enhanced pursue the management revenue of must We meet margins quarter experienced sake segment, XXX gross parameters risk-adjusted basis points identify where and generate we Each returns. year-over-year. in revenue. opportunity increased risk pursue acceptable of another service the and strong margins

a to margins mid mix that it we expect here targeting On are support likely than in to around a ongoing the basis expect range. relatively will bit, we forward, an low business to basis, segment figure but Going owner-direct continue XX% level we expand. on quarter-to-quarter bounce to stay rather

provide see we However, this expect revenues respect segment collections. At update grow. in growth have to I going any do gross don’t claims profit dollars the to time, with to material as increasing forward

options We case, on to for engage each and continue our pursue explore In counterparts various resolution. to we’re with and focusing results. maximizing

projects believe claims year, it’s more other will these before, on communicated in calendar while have will resolution likely we be a resolved be XXXX. and certain we take As possible processes this may time there than

Jayme Brooks

A our quarter’s million. by working quickly cash part management becoming as evidenced positive daily of our is discipline, maximizing flow focus of first a liquidity operating $X.X capital improving and on

evolving again to environment, providing a any liquidity reporting we not the reporting March of are post financial although period Given snapshot subsequent our results are position, period for XX. we

remains the of end cash and million can At success sheet liquidity great X, of as collections, any just liquidity through reflect our liquidity claims course collection cash a a balance cash million. continues on noted. effort. does see and invoicing, this on It from position in XX, proceeds activities to total large, May, and ordinary you and of team the improve. As as substantial focus $XX.X billing had balance $XX.X Charlie May and Slide overall with and such we results By on greater not

any have any or have markets. slowdown our material do we identified not collections, not retail, customer before, multi-family seen credit to among base, energy in As not have any and exposure risks new the

Charlie Bacon

few update a we our overall strategy. me to final Allow pivot address points to before on an

a national economy substantial. choppy and in the experiencing to compared and We’ll planning as greater right about approach. of ago, market to but we clear the the of impact from economic pace is the we’re it’s to levels recovery that waters, normalcy the for the predictions few even anticipating been which While has we trajectory every shutdown weeks others, leave believe are just

that In large projects in without remain growing term leverage. to need execution operating importance cost strongest the a and owner-direct facing can market we’re right I’ve on the For of Limbach, resume, months. of very and The diversity, in near that when discipline allowing provides maintains on In XX multiple elsewhere, to branches healthcare, solid we like Limbach our visibility resumes geographic focused the company’s making to working revenue past, projects companies, means those margins will the ship the liquidity and continued over management, focus active on with large new including see as and right the handful project us margin the and pharmaceutical discipline sell impacting and market business continued stressed backlog working changes respect extreme In to stronger active. Without data R&D the a focus our best biotech is or with We construction. to for customers. losing labs executed capital a and market we to current selection, especially XX current project construction resources structure. centers sales next downturn. fundamental in large the the in remaining for project locations as more the environment, well attractive profile, cases, sectors. and diverse

and and we trajectory of we’ll on-shoring discussions projects. in in see all optionality we all sectors us there continue the well interest select served has should and diversity see upside additional also reason is support in areas. of recovery, future. compelling and with the interesting the That the of that and and to quarters of the with these anticipate expected industrial manufacturing in Over several past, benefit wouldn’t prolonged services, manufacturing. education, the investment we breadth opportunities geographies, The why our the and entertainment think period customers, of an in Irrespective also rates next from no we years, government, and in it

we’re are to are for beauty that segment, deferred of perform. be a cessation whole now fails With there suggest Additionally, thinking to evidence of model. maintenance and limited eventually construction maintained. Certain the months have must the event. Certainly existing work time, the but and on uncertainties, essential be interpret offer unlikely can nature appear several last want widespread the be There segment. an an and service the on a replaced. but to buildings that, is about the exceptions validated the service on future of we the we business of the projects turn to we activity That’s period of how ongoing our evolution equipment prolonged our basis will must with wholesale update strategy

consensus of the of board team. key has of diversity individuals experiences. committee led could restructure small own We group interfaces with board. the often three months and influenced and perspectives. the last debate I’ll where discussing. basis over worked structure executive a efficiently group building capital substance and from the o more different be most structure This markets To through discussions we’ve of heavily XX want were last individuals the multiple broadly. XX well with that This to of working services larger broader decisions made business wanted as to create throughout I what as leadership and we management capture in our years, is several having experiences initiatives are the introduce with to These yielded skills a the often input The the and and a new to rigorous by over We’re and have seeing the briefly. well together be goals six a bring construction to opportunities by team. Slides executive begin, the

made redefine risk specialty to The paradigm. the initiative first With or field. management lost money the is is in core contracting,

a labor. Limbach’s the discrete uneven. the overshadowed performance level branches across in by many impact has warranted years customer variability. stringent our To with number more sales substantially of these sales from That capacity projects of central write-downs counter during process long, the we of outcomes further critical relationships to several rigorous decisions. filter to and the on duration. greater local lack more drive internal the at market size factors strong and too based processes audit characteristics, been better administered with back end get-work autonomy availability authority In has and local have of project number and the and that’s a should project less projects. review operational For a together hindsight, to will have end local improved been emphasize review cycle, like A project with front In last particular, leads upon risk, of that modified excellence more less

internal redirecting audit support We’re initiatives. reviews these project to and resources

of our capabilities, and Reducing controlling to need and we project phases. utilization planning mitigate schedule all increase during and the both sales the and budget design and cost risks. Additionally, scope engineering

leveraging long also and these facility and stronger and more that leads owners, term profitable Importantly, customers relationships. our impresses to resources

Jayme Brooks

needs generate We cash Simply more core as flow. cash profitability company to and stronger in is the consistently to field, flow. second better just noted. put, the initiative must maximize Charlie Our execute and returns

to strides effort the through While need last months institutionalize made accountability, it make the capital in we sustainable. greater several management we working significant and in improving

internally We and to the way business continue an which costs, processes. do towards the business improving including eye in project also operating with need to monetize our claims we analyze

advantages including decisions, to growth cash well era. the a we We’ll need As and to of and to allow will company’s drives and areas which flexible business to generation. move engineering-driven into borrowing costs to more regain organization initiatives. our more ability support think and and the capital we flow reduced hire greater these overall. in consistent critical new same This Executing we become the leverage substantially apply to forward to experience the rigor the degree design how responsive investment forward, offensive is to

Charlie Bacon

initiative to owner-direct expand offerings. third is Our core

For money large almost XXX projects. in years, Limbach construction has made

and throughout talent large is jobs those get unbelievable pursue and building we’ll institutional imply projects, to facilities unless gating the but those will history to noted. of many with experience markets built process executing a do some have organization, success them. continue in large In we’ve We don’t in subject a so Limbach markets

has we the As the that cyclical, contracting engage the has discipline, market Limbach a one from for projects with large across relationships. scale has as can shift today, substantial risk-reward the is shifted the will found the inequitable. various large occasional building our focus chain about value we more work can propositions revenue diversity but small owners. the to industry which and for think directly we model shift size the directly risk-adjusted leverage facility to find however, everything with project in evolved, so project work relationship. larger, our unattractive source and an by in with traditional unbalanced new investment and structure from capture and and pull-through with performed includes can services destiny. far maintenance found be products small be profile broad challenging our our we markets, controllable. irrespective next too and we we to less broadly proven ongoing to demonstrate owner capital towards could the work and work Without and will the of and owner can ourselves too control and and often of proper Even while facility and This to Across capital project controls service allocating segment, provide our returns, midsized generate and have Today position where the be has value business where is other always owner-direct often over with represented work customer years, from is, several resources projects focus this solid Limbach’s contracts able Limbach’s

been greater projects project long relationships building lead shorter than we across rule, to and the of general we organization. how approach we more this higher historic will it however, Based in outcomes locations these others. term our on has can duration the of This maintenance overall anticipate although margins. model, to become believe From in a feature certain building long a operate point so As central owners. experience, with consistency forward,

Importantly, in capture generate capacity handle is profitable a remain critical the work. This are not the owners new future. we those digital construction revenue a described, and I To and will we’re core competency can we building and with large that to products. and generation collar offering just to the business line maintenance also clear, foreseeable confident this earn only experience have acceptable high new streams. management but Subject structures services to risk of a design that a in and blue returns with markets better relationships white will also technology-enhanced be to collar offering capabilities margin leveraging traditional stable of labor facility engineering leverage

that for a XXXX, XX% XX%. Ultimately, company, We annual the of approximately accounted and XX% year an public almost revenue focus segment great for however, of accounted our for several just given gross which have revenue service critical On became for consolidated service quarter, the been partner remain at striving commenting and share to of of on some relationships, greater over those the manager profit to basis general profits. a and, we’ve a gross years. the In transition we on groups service forward. owner construction intend accelerate contractor, to Limbach are construction we in through just consolidated first over margins, and XX% going

exciting we and see by to by split XXXX, the owner-direct balance on in transitioning a to redirecting are Many but advanced pipeline. than have we construction expand platform. to digital we of built best to the resources then. robust others. with services XX/XX a technical reach by some marketplace these of a XX/XX From only limiting now We are this opportunities our revenue there, to achieve development, by opportunities more bundle under spoken can revenue previously opportunities about We striving believe

systems. do facilities end-to-end can Collectively more cash to company’s future these market initiatives that in Limbach flows, that questions. take and a technical work should solutions leverage lead as a more and perceived have the is better position, for of more services defensible see your critical but greater stable to With firm competencies. dominant that, we’ll a We provide diverse we respect, where

Operator

proceed instructions] the of line [Operator DA Please questions. question with Brent from your Thielman first Our comes Davidson. with

Brent Thielman

Great, thanks. Good morning.

Charlie Bacon

Brent. morning Good

Brent Thielman

willing Charlie, of guess size I’d or your the I large on parameters curious comments, maybe going you’re off forward. to new what be projects cap here go strategic after

Charlie Bacon

Brent. Sure

projects. this present have either it’s a a like large we look every million geographies, looking the continue at management scale place, relationships where probably $X.X we large to valued company $XX we very are we’re kind positive you smaller Ohio that’s - risk with them. could million with X, million, history scale market in and so cash ago, to XX put particular this call up months select geographies certain committee, general ruling morning $XXX of very of with in What at see Michigan, doing can still contractors and In not but and projects. making projects will side we’re largest successfully, branch at Friday those very some look look the we’ve In that doing owner-direct, When construction a or certain know, on XX, Brent, and at that the flow. so I any some XX, standing take we’re of profitably, executed to our point, We’re geographies projects more the shift at project we’ll that managers, that XX, XX, out. be you very XX other those to XX, over

led no to projects led I of discussion. terms in to, we’ve the dramatic as need contracts. think think, as our to really good proposal some well saying enhancement It’d and margin seen it’s some to what I see certain in we of

within the We’re that not to on think the better and large that just have in taking branch place handle projects, is and to see ruling project processes they we risk out to competency to they’re I need the management have it’s resources there much execute. that the we’re going scale

Brent Thielman

regions certain quoting that new the what here, opportunities Then for curious this just in the be work Charlie. there disruptions looks that, for of you’re in thanks seeing, the out experiencing Okay, levels beyond bidding activity you’re like pipeline environment. and

Charlie Bacon

on it service, construction to comment both so break segments. down I’ll and Let’s

climate is not with the of at out They’re field, still talk been protect segment, I of couple to have about is. group have but we from virus how ourselves our how CEOs we’ve over dragging been number of the not month standing decisions hearing we the business clearly deal CEOs call decisions and still said, with people off, projects months out the workers I’ve help but half It’s stopped. they’ve a everybody - the we to a that I’m bit and a other in were do a of bit. opportunity can’t bit, there, but but firms and in general looking discussion, the spoken What past I’ve major the cooled over that having of like off past actually seeing. just the people contracting to a quite a holding On construction making seen to there’s a used

a a wait for look we’re in see, stand backlog, out news branches. the our good sold point, is and at we just doing think when but Limbach with number at we of where I everybody this

looking quick projects. the for But we well stuff year. which sold, as SPD service pretty our our is for most as generally into good hitting special some projects, part, we’re call looking work, falls backlog this so for what We’re smaller -

the and we our happen is in the still work remained leave that We some work, for seen fairly riots, on is a emergency bit what with doing told we spot and that little Now disrupted continuing. still we’ve that’s work city service materials were earlier had type segment, most robust. the we were are bit part but a the areas afternoon, to time

In that’s on don’t terms because and people buildings maintenance seen the we’ve in pull of want right back mainly now. a preventative sales, that, us

to if other that? do be to share of you that’s the think sales seeing. it’s have I were something seeing and still that’s we’re service, rest the is - pipeline, already breaking, that. fixed, soft robust of a But that’s around good service, pretty unfortunate you’d what so we’re a have with got we comments base, a maintenance bit beauty Jayme, like any but

Jayme Brooks

thoughts No [indiscernible].

Charlie Bacon

to about, that does Okay. enough talk on? you’d specific you markets color? or Is there give like Brent, any ask

Brent Thielman

with guidance, helpful, near last you some the parameters date you’ve No, any lower Just in commentary experienced can hopefully half? aren’t second that’s disruptions? directional looking COVID quarter I up we can handicap guys Charlie. of delays Should in the back but the we so some understand these term think I one, providing then you that qualitative something for provide, guess there. and my all about just we little a quarter to pick second

Charlie Bacon

of at clients it the a the was couple we majority a so facilities Boston on look there with Cambridge, didn’t we of had similar of you major work and our kept business a on projects when projects, continued. had sidelined, couldn’t shop were the good we the and side. the to on We fabricate, situation dynamics actually going up but we paying, continued did We going because of shutdown we a of know, face but stuff had the Michigan that site, in in we so kept the prefab--you construction a bunch few the actually fabrication prefabrication, kept Yes, so backlog while we business, stop. needed

some had also come emergency in. We work

that saw--we so of a it convert to a best think right shake overnight that probably we the I out the days, an to into care also like the happen, going that’s some some Now, acute XX yet had that numbers We’ve offset pull now. for but some we not That other I back wasn’t unexpected things are had pull so how few revenue. back, center but But was substantial sure quarter. could had share happened did revenue facility. we I’m convention in

Brent Thielman

on, thank you. Okay, fair it pass I’ll enough.

Charlie Bacon

Thanks Brent.

Operator

Thank you. telephone Once on please a again one as keypad. like a press star, to ask you reminder, if your would question,

your speaker using necessary be handset it the pick pressing may participants up to before keys. For star equipment,

Investors. from with next questions. proceed your Long question Meadow Old Please Jon the comes with line of Our

Jon Old

Thanks Charlie and everyone for holding the call.

the end and Where Just as remarks the sort goal, margins specific of in improving you expect--where mean, for--I do the are XX%. can was prepared quickly, more then in how you SG&A those what those in gross and and hope you What have maybe then the less, started. do release improvement, you your SG&A goals discussed Do getting a cost, specific to are quarters, up? or sort that talked you initiatives you to gross land. maybe coming expect margin be to of just XX you--where you about

Charlie Bacon

question this joining Jon, for thanks and the thanks us Yes morning. for

our to margins, to good gross I see I a margins my the going land. in to think we’re numbers starting you - on remarks, where off to service continue First mid-XXs, stride we’re XX and there hit that’s those know, think

We’re reasonable going but see a I hard to more, to that’s expectation. keep pushing think

the as please? with On hard wrapping past so especially could happen we construction backlog, to challenges I that future. work the side pick SG&A, on margins out construction up, you the we’ll work the of Southern see through to and that pushing for see we do continue we’re Jayme, in comment up, California in expect that think

Jayme Brooks

Timing for probably be any fluid of those incentive right well to that is points anticipating different--you would through incentive Last XXXX, any to SG&A, say our the we we’re we’re through we’re reductions come and at still as and working that, did and now, on layoffs the just that. full do top additional when the cost and return a that looking furloughs on numbers have year. the be of our how know, comp. our numbers headcount and it working cost add timing Yes, as year, in would as the year, we full anticipate few at that didn’t are we XXXX, percentage over without comp consideration over initiatives, taking so last have--we holistically we reduction in look for into we year, as I so

Jon Old

be expect higher confused to so And year? I’m than there. last you it

Jayme Brooks

a look basically throughout basis, grew commenting we at On we so I’m year-over-year a we was higher added year, the year as throughout because exited grew so headcount is the total year, QX you level, on. core from--if at the what

Jon Old

On absolute the margin just dollars? or

Jayme Brooks

Absolute dollars.

Jon Old

Okay. dollars? margin the be you absolute But lower? to expect Oh,

Jayme Brooks

On yes. absolute dollars,

Jon Old

lower, correct? But you to margin expect the be

Jayme Brooks

Gross margin?

Jon Old

margin. SG&A No,

Jayme Brooks

percentage percentage? what year revenue from how this that point. Oh, the we Depending know SG&A yet perspective. on at exit necessarily don’t is I a

Charlie Bacon

Yes reduction. headcount Jon, we’re a taking focus strategic think, I really, on very a

think well executed saw happening, going permanent. headcount I lot and think to we QX on that reduce of what remain to during I a is based we

at you’re focused all see part a processes in very looking company, other the as terrific Katz, to He’s we at outcome opportunity led some Executive our identified but reduce being going exact think so Matt actually aspects got improvement. opportunities. looking that. an example yet, know by other one that’s see continue of to a that Vice I bulk is We’ve don’t effort Presidents. costs, I the we’re The of to strong purchasing of very, as we’re continued

Jon Old

Okay.

at job down, great the if that cash so position. a your side, done it’s have net guys You position, way we look debt cash on now great

is about the if add--and look started without that? penalty. that, of the the of are is on refinancing available you collection, size towards total even cash there? you late the of of a sort what just you charge-back potential include collection. working and facility, you Anyway, which fall, mid, debt Have doesn’t question how fall As debt future thinking terrific, any million, still could believe the $XX it the you just sort that much that’s and refinance can I broad Then on also, if

Charlie Bacon

that refinancing high executing our continue I on as what we our to what strategy do year, be possible. on management we’ve very this to entering can can and of that quickly refinancing, bottom performance got it’s and timing, looking list, is as so on is market we’re focused focused laser extremely We’ll to see seeing to do with on but also move make assure Jon, business line. you, execute, question can the we a just focused

we’re better On these management I have virus get hit, things: performing we to I have going are the when It interesting saw where think company and three get was stride. today, than an I stay that we safe, went is much continue guys, the the I cash, the - we to the past, cash, in team in work. stand very just said, things idea, important the most and

we just hit our hard, I how been remarkable really want it’s On customers. cash that credit and to side, the get

of company. much we just Our push to seen everybody’s better customers top continue think us, to we’re and all the the and opportunity cash coming we’re and listened still going position, those. It’s now always think to have with to these I will On very they that. question us and helped we--I into a which claims on resolved, on be timing that, future a hard get in

to our from We’re opportunity door. that continue of that question. not very the to hope strategically. your so We walk position, maximize to get away a we’re bucks work going want I just to in couple answers going to

Jon Old

receivables What’s size Yes. currently? of the the

Charlie Bacon

of the The terms claims? receivables in

Jon Old

Yes.

Charlie Bacon

I can’t that number, divulge Jon.

Jon Old

problem. no Okay,

Charlie Bacon

sure I this customers in don’t mean, on call. I I want-- listening I’m have

Jon Old

is still--most million the fair But that no Okay, shown, little that opportunity, of to come of incredible that it of problem. $XX us? has the very ahead lies say in that collection from so improvement balance, it we’ve

Charlie Bacon

true, That’s yes.

Jon Old

Okay, great. Thank you your for time.

Charlie Bacon

Thank you Jon.

Operator

telephone keypad. question, a final star, you. if please a as like to Thank press on reminder, again ask would Once you your one

There be at to questions. pick this For One like the we necessary participants back turn management no for to time. for using call up may the further any handset questions it closing I’d speaker over remarks. poll to keys. star while more your are pressing moment please equipment, before

Charlie Bacon

diversity in company. performance Operator. and to and our along sectors, today, project Thank as the years XXXX strong being XXXX, essential, with you back with solid we the hit the backlog services, start for XXXX customers In like of Great and Recession, led then

While our place improve dynamic our regularly economic environment strengths of with today’s only and and our call, Limbach basic economic to first, in plan interfacing is team today’s strategic executive results. committee. board’s To deliver recap different, is leadership better the opportunity remain the will

has support with with oversight and core just is our our a Two, applying balance strict focus our by opportunities. talk with growing crisis a some sheet, our about ambitions about technology on and we’ve was exceptional. processes the virus offerings focus in the owner building us SG&A. day. to focus strengthening of management, strategic our Three, separate our of risk we rapidly from forward economic results, further Limbach We talented moving of supported on the management and team on is growth competition, I experts are dedicated industry. the decisions relationships our balance focus every suite think five, and the the dealt sheet making market Four, will How on that most

- cash staying that impressed few Our the work just we just and was of liquidity get safe became focus - with sick - virus, very created talked innovation about and people get the results, our me so people. and just and our the outstanding results QX Thank look we’ll to business, our our outside attending so within results many presenting you our by in people future. Thank business and today’s for you. forward call,

Operator

today’s Thank concludes This you. teleconference.

Thank this may day. you your for wonderful time. at your participation, have lines disconnect You a and

Limbach (LMB) 16 Jun 202020 Q1 Earnings call transcript