LMB - Earnings call transcript Q4 2020

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Operator

Greetings, and welcome to Limbach Holdings Fourth Quarter and Fiscal Year 2020 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It's now my pleasure to introduce your host, Jeremy Hellman of the Equity Group. Thank you, sir. Please go ahead, sir.

Jeremy Hellman

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

Charlie Bacon

Good our and for to your morning And us. joining thanks and welcome, results everyone. We're excited questions. to review you with take

we to me the Mike to today business execution, more to Chief first Joining him I of investors. Mike joining Financial color for Mike the Chief provide come. operational side top head into our He Brooks; great Jamie terrific More Operating Officer, to and it our with to of XXXX. have is time He thought some and as to the has from McCann. introduce us at I Officer, today made want contributions I organization. our into Jayme be the our partnered would has and operational

thanks quarter want I echo I any go at Before further, to X,XXX Limbach. my from message employees to approximately of last the

in success of XXXX Our was driven group by incredible people. our

year We operations successful our we fourth and accomplished. I recorded during be in year. which cash, the foundation occurred strong with of fiscal to proud core more, which business our pandemic. close continued improved entered have of following to and the subsequent have focused XXXX, safe, We plan. and and not is of our the year-over-year in the structure growth capital quarter, strategic of substantially XXXX refinancing, worked. owner segment could the direct truly challenge, what to profitable the substantial Limbach of new You rose of all on a finding you It collecting were staying

debt, to reduced When lower of approximately fiscal expect interest raise, our million we to transformation, on direct $X rates a result we in position of and significantly cash including the capital a company's realize growth. expense key As compared execute the XXXX, strong owner of to reduced many XXXX. interest funded overall level of strategic and initiatives, strategy, our with own acceleration pursuit combined recent a digital of

be saw place of part in we the we owners, due to fourth temporary the a and the post-COVID sectors inquiries the due end for opportunity macro score with in was of prior doses think Scores XX-month reflection COVID but ABI enduring in firms some millions The deceleration XX.X. We might will toward trends. The a expansion. quarter dramatically the to XX.X drive from be term, of the construction score like other average busy, on moving is proof a the AIA’s thinking Index. From of jumped In being the it's the don't of measure, is to supporting believe are we the project XX.X. anticipate given When and broader a year. differently. large we more we pause that that by near Billings revenue, decision-making dynamic to that took has that that designers Architects of of some key the that Although Institute resurgence recently market A business push vaccine daily, pull optimistic American up released XX new level, are drives above non-residential The or various impacted Limbach. indicate to pandemic environment.

customers. markets, services, on diversity and focus our geography, end of soundness the reaffirms which of All of

facilities. CapEx see pharmaceutical healthcare R&D markets, end core data including several budgets to in facilities in continue our and We strength centers, large of

growth attractive our emerging to tied COVID new Several meaningful pipeline, farming air in of due and seeing sectors Our from sector, deferred agriculture projects which the as customers continues were we are an indoor and are we're back and other tracking controlled to significant that quality are end well the positioned. in opportunity now remains that for evaluating be amount airflow. to there opportunity pandemic, in Across dust enhancing the clear pandemic. indoor building and markets

the engineering development group, of implementation differentiator solutions. when the to focused start trend. to with our paired We customers assessment exit activity activity services, field design believe the the levels driven that on driven the a services first is is professional Broadly until capabilities. speaking, guiding as From Our opportunities been upward collaborative sales these is our the year through apply and levels engineered we've Limbach on of retrofits steady through we an and of quarter. have ability progression huge experienced now approach the

over quarter first don't to we've and construction the focused we different quantity. year, any be degree. Limbach’s any a over on The XXXX will is slowest stated perspective, as quarter, seasonally last we quality expect are From repeatedly significant

is point As into for sold gross of position XXXX, year. revenue in approximately our we the profit, forward look good and to XX% a which construction in be an forecast we've account at this

to a is to our of larger revenue, second I want portion resolution. service that in note percentage the complete none first assumptions include forecast, our burn of a direct, these and XXXX construction the less related will forecast on figures half In of at our year claims as owner to half. any gross basis. profit the Looking backlog of compared Also, coverage

got or customer the single sales the plenty function Construction on mine, because go which we we Even segment. X,XXX for than within business in in still of There's encouraging, experienced of We've sales cycles. reporting However, to that velocity, good. ring. over think and the pipeline profit the preventative greater of for are that's phone revenue is there's what that looks pipeline works there. to growth visibility maintenance the not period a of segment. room when naturally model that With much opportunities and and project said, shorter there's and and revenue these timelines shorter how Many come just of less executed is somewhat sold existing otherwise life we're waiting full the relationships a are current

So, financial with performance. move to our let's that, review on

Jayme Brooks

Please along company's the on X. presentation, starting Slide in follow

For total segment to $XXX increased million. X.X% revenue X.X% segment by the increased year-over-year, Construction full year, XX.X%. Service revenue increased revenue while

Our resulting XX.X% and Construction split XX.X% with Service.

we Service of While has the quarter-to-quarter, XX:XX do more business on flows and towards and contribute may historically. back the still overall project activity, when at to we years. several the than forth focused driving revenue on the overtime, split sales revenue it move expect depending we're to And our look pace split

XXX Service is This revenues by XX.X% as primarily margin to increased margin. improved margin expanded XXXX, points segment year basis in with expansion in XXXX. the from For Service XX.X%. to for the continued Gross gross well gross the XX.X% as driven of proportion compared

level million second expansion summer. the year, to along selection, work due in activity increase back of expenses with performance-based the our half million over year the from aggressive in gross to savings expense those the in business compared And by however, were recovery the compensation relatively on $X offset million Last focused to year, $XX.X performance the increased margin in ago. XXXX, added on a performance optimize project related incentive are of company strong As XXXX. $XX.X in COVID-XX, certain are we program at selling. SG&A mind, meeting that Overall, with for we any company amounts not did the year. accrue million. cost the in additional in we continue we new company keep but gross due compensation those to for We profit And to QX not XX.X% to criteria $XX.X held cutting did benefit

As XXXX understates a result, current SG&A run rate. for the

services to from a more to lines We return in SG&A, income such normalized have million strategically expansion growth T&E. flat gross of business, prior expect and environment profits the for to increased $XX.X million, up year. in operating owner improved as the direct $X.X Between investment and and our and expense

For million versus $XX.X per income or or in EBITDA in an was $XX.X $X.X share XXXX. share, $X.XX the million per which was diluted year, diluted XX% Net a adjusted loss from $X.XX was million of $X.X improvement approximately XXXX. million,

to in revenue to to end was to that Slide spiked was January. quarter that into X. as somewhat to segment and down We levels decline Fourth to prior $XX.X the attribute million. decline of That due activity $XXX.X reduced by into which compared the million were mainly Moving really XX% Construction revenue XXXX X.X% year. COVID,

in pace same be on anticipated. still While The a net jobs quarantine XXX performed That continued projects schedule needed in to on not by the or which slowdown certain revenue. XX% the branches, effective to times. workers due recognized, workforce the levels had work and was is and as XXX were reduced at result much as will revenue to we assets as of heads,

quarter in last million and a segment some demonstrate XXXX. offset to gaining Construction not $XX.X XX.X% is the of it So, Service the to of continues slippage revenue fourth growth opportunity. for

Although we revenue COVID recorded need any building We be to serviced in that there view demand growth loss is systems repaired. the segment. and was also pent-up mechanical a service still headwind solid quarter, as in

do So, was into basis up, Construction gross we expect there in in the those now dollar on segment And year fourth that quarter XX.X% limited the million. need compared still the for a of be opening buildings, are $X.X to prior get the XXXX work. Gross for that situations we things couldn't as to will decreased XX.X% work. margin service period. margin

decrease a project in when write-downs this compared prior same were of revenue quarter year. period a although As to the in result less the

with EBITDA compared year was XX.X% of Construction On to prior compared trended in $XX.X was of dollar due jobs, $XX.X $XX result, year Debt XXXX the months a gross service prior work X to million prior EBITDA adjusted capital. larger not million against XXXX mix of the of X.X% for was adjusted that offering. prior project criteria the million gross December for million was September to Subsequent million million XXXX, quarter of as the was year. of million. together ended totaling periods. increase towards than million of accrued year This comparing expense period. XXXX. some benefit total X.X% The period. the carried nine expense And performance-based expense fourth quarter and and to balance cash XXXX. for a increased the credit was letters in quarter as $XX.X XX.X% fourth we February the gross the its pricing. common as basis, due share stock profit company quarter XXXX Slide of the through XXXX, standby $XX.X $X.X quarter equity approximately exercises to count reversal fourth working primarily to equivalents higher which for as million borrowings fourth margin when of the $XX had in million. our XX, for for Service segment million facility SG&A million it end, the SG&A of in compared to revolver issuance highlights also $XX for Fourth year a $X.X our company credit the other $X.X for XXXX $X.X the to margin a of As year compensation and of compared no XX, XXXX fourth raised performance to with segment warrant the modest quarter cash sheet XX.X meeting provided for The XX,

pro at the approximately a closed annual cash new loan Slide facility. much $X of credit we be the interest Slide of is with February, savings facility we In expect million our lower can be old in interest facility a table comparison the X. on Our XXXX. term capitalization to of refinancing carries forma on X. new equity found and The credit In our on end rate

a margins from touch forward to on want I qualitative Lastly, going perspective.

an We also gross our and our strategy our for will XX/XX a in our mix margin EBITDA. push adjusted upward create trend expect ODS business and

time everyone be remind So, takes may not to I linear quarter-to-quarter. shift and want that that

our addition pickup even from projects business year booking don't the to are may or projects means any return simply away a reported In focused ago, opportunities lag. mix, also fit In were desired that so That the construction that on walking as are on we margins. given work as margin quarter, margin more now, we working that secure higher we profile. be will better booked

some on to progress quarters it year-over-year it to take off So financials, our a focus Mike hand our the it'll reminder, now. best way gauge realize in and fully full results. is to to I'll just

Mike McCann

determiner primary want as Jayme. discussing spend I Thanks of the project time some our to as a success our selection business.

of revenue of upon the is to balanced XX past, number large projects was between shifting diversifying years. a we more and very building size transactions. higher will construction the multiple manage drive booked lasted to duration the margins. also seen and by gross months. increasing factors Our that strategy focused We're The already in enable and revenue that the our general these dependent revenue built smaller We've results projects the risk stream In better our company contractors contracts work shorter on owners. and upon last

Our large building maintenance to sales capital have owners, and with marketing leveraging refocused as base, efforts as relationships been in owners targeting new well programs. our

better through ensure complimented In new addition, relationships careful to expanding by and management both operational with additional strategies looking has overall the professional existing sales leverage offerings. both very company practices. The is Limbach risk geographies, been services servicing to and

direct communicated strategy. practice our sales new the staff instituted Over the to must It's expansion our efforts owner relative months, risk past management sales XX been company that to clearly pursuits. match

a construction focus. to company the We are direct the solutions-based from a of account owner base transactional management focus sales evolving project, culture

be We with Once in slow make with is seen cultivating match I stakeholders in to risk our owner and margins this in sales opportunity the owners will sales perspective, in major rigorous identified, much place we've prior is reflected want of Slide rendered the reaching of pursuits Large to From this projects. accounts. the to sold or Due wrap-up that We operational a highlighted presented. projects improve backlog Limbach. which outcome first X. release the XX.X% profit the better those activities to the expect are the pursuit project will established is demand individual there's the opportunities project of and building multitude be the management services will continue spending. in the and location increase have once to capabilities capital we've months over sale, result OpenX in of Evidence over macro anticipate is an be leverage the few appear months fact improving, of team pipeline, XXXX a all sure sales next yet to funded, profitability. improves on few process realized direct sales relationships a a to comment XXXX. to proactive for pent-up an the

sales is back starting get on seen We given project overall QX healthy. was our activity, had well, projects normal recently on result QX in selection some have softness and of defer to focus expected as but activity even schedule impact a moderation. pipeline level to backlog

half stands projects than to our work we exceed where it has work for Given now, our first to half past. the second calendar that the XXXX expect and dynamic pronounced be in more

Charlie Bacon

thanks again, and us joining morning. Mike, this Thanks for

As our you've but we optimistic we remarks, us, are can know heard change will all that be behind throughout pandemic quickly. the prepared that

when revisit results. mind, past, and us. we hold clear, have we but are in providing our to stated prudent the report I've became in now, before guidance With that look that services during to off think forward for As it's it pandemics, pandemic behind essential we'll as and having the we done we QX

investment, healthcare hospitals our in will by opportunities, actively for schools, billion are and all modernizations our pursuing replace Funds there industry, the made for medical cited the going funding and out should specifically Overall, schools. funds and be end center, starting in data of bill was patients. revenues, variety the area recently provided branches are example branches injection of there elements we makes in. expansion. move owner procedures, also which ventilation of an the also the may let of set and massive private which a new massive systems The a Updating Limbach, will government package. a of while will reduce of available is diverting the system package. was for a me If whole, appears be $X.XX created water Washington funding, There with and benefit part direct is monitoring upcoming day-to-day not stimulus for D.C. energy we and which opportunities there to more issues retrofits largest which we're impacts as also whilst sum the Q&A Apparently, of that those into advantage are passed to well-positioned green also few infrastructure actively Limbach. opportunities is crowded public at be which amount all used further is be $XXX hit to final projects market. administration sense case, our with is building One take to of for to We're schools, will interested a healthcare will consumption accelerate much-discussed the via competition stimulus that to being for. the Before being money economy billion to our have of COVID were as

it As equity ready are to with are and play and with project well clarity well-positioned mentioned and end as our key raise, primed relative as risk continues We're to markets in recent as focused behind selection. of and pertains and offsetting we The offense. on effort active us were profit several earlier, diversity we the operations the sales serve do means of and to that others. our appropriate refinancing driven very marketing we'll weakness

services. also Indoor to Indoor an the provide including our of is a that win by evaluating we gains space, We farming continue expect opportunities. all momentum perfect prioritize income now great early industry as example is services, and annuity emerging beachhead more to the established We market maintenance in of a work there. this. innovation to farming opportunity

We will this move believe CBD sector beyond production. also

meet position that offence. and opening be on diligence up our respect balance to business We'll and ability by call before with our to and acquisition to touch valuation. criteria sheet desire model, to to your our identify market the opportunities again our guided questions. I returning play M&A Lastly, want to

the consistent we've business narrow described objectives Limbach. Our certain for in parameters respects model are with and

our prospecting dictated our for be to requirements and even from – M&A while not months, we other in during cold businesses With underwriting period perspective, XX companies of we've we're context, the way do we're both known your understanding from need XXXX and by in challenges several last opportunities get perspective will that, take the questions. potential The the available performance around. the comfortable an of to case years. many timeline starting Our target presents not

Operator

is Capital Thank you. question Lake from first Our Instructions] of Street Rob go Brown [Operator Market. Please coming ahead.

Rob Brown

morning. Good

Charlie Bacon

Good morning, Rob.

Jayme Brooks

Rob. morning, Good

Rob Brown

on number the little of funded, talked you owner color the a wanted year? been you yet, color were you over see think projects that see of how moment to just and what more fair but particular maybe developing haven't some Just get pipeline give and direct, about you maybe that a and pipeline launched I at the sort in can the

Charlie Bacon

we Yes, and March, back election, talking tracking since could that the mid-February really House due some continue there's up, our projects were understand just been confidence and Sure. sitting book weren't the customers that the see. vaccines, had expected. a to to that's of if tremendous White Yes. we they But we to some is to But the making we which the mean past to into QX, what don't I back at know has coming way wonderful when the because over interesting spigot the of look decisions in who's and you all opened what's work, uptick but us. about, just

the the customers. burner tracking of includes get that a that will we sudden, going to conversations again. So, on projects They're decisions with ready and that put all back having we're are were forward some just coming this

So, back but it's the great up just see. opened to pipeline Rob, has

Rob Brown

Okay.

sort could out. call go view think your about kind EBITDA improvement, plays margin Where Okay, then of the talked three four it of can out the say your on mix merger to years you about, you EBITDA great. what do? where do directly shifting and as strategy And of margin

Charlie Bacon

a more to there be. on when We think there. obviously hit news just Possibly, terrific, Is you segments, range at the us. the we're look you when So, for at year. we XX.X% great XX% of but XX% that's that's a for we strategy The improvement? look stride direct and We both segment. where is ODS, in room hitting obviously margin think should last we're growth been

points we Construction job line Officer Chief the not growth. of On earnings. the over Operating so has past points X.X and focused segment, selection just are management done prove on as a another out Construction bring Not XXX Mike execution. McCann, at splendid quality top and XXX our processes we if can out we execution. continue introducing think much about It's there's years we risk of to laser more all to basis basis

basis So, We quality construction going even side. a EBITDA, when down the it's service drive moderate directed to Construction. bit; grow of pull We to just growth. basis we'll points again, might we're rapidly see all points we on that on owner right you XXX to get earnings component, to continue about back little another can think XXX

dropping basis could down we here improvement. see we that right to there's XXX EBITDA points believe points to XXX So, near-term basis another the in

Rob Brown

of of Thank kind customer lastly, trends view in and what the kind of of interest great. not some of just but changed terms that are segments? industry. COVID, environment. you transformation changing How those And Okay, sustainability been some the I on the COVID Has digital in seeing on of efforts? just guess has and only the the you. the the then

Charlie Bacon

from a I about but which COVID virtual we're doing necessarily we're is perspective, play, a Looked instead and ramping is really which from think not up. building, lot a up calls we've in excited our tech learned remotely, all showing it, Yes. what service

were we that accelerated that we April the with and buildings and couldn't but May. looking play certain it actually get one into in that's COVID to March, at prior because impact, back So COVID

call. do not a perspective, in for there the a it's We're lead coming owner a of so but out green charge developing going of yet, model. subscription pushing the nice phone drive administration it benefit COVID of that's and but the We've we drive to We're still expense type to we're city been having sustainability terms with that, that. it for for doing and all very We that a I'm to clearly service for is us XXX% less believe sure across So, time, it amount on van, playing We or will models. not a the jump From that. energy in tremendous retrofits. of that's working decades. now

noted it's improvement, retrofits, defined. building to understand out energy. very be last $XXX patiently of incentives Energy going think heard week we out that there's here, of it, still We but So, be shared around sustainability for for that's And the laid nice see a not all have to perfect sustainability I of but our to we're in to if I the and information infrastructure we've start waiting they billion of buildings lot night, points roughly concept this past of those the infrastructure we there comes just of one what marketing the their be. bill, participated green and could out mean, fact have over of we was associations owner some in take advantage bill. on incentives of those us. $X was we relationships, how might one all trillion know can that around

the So, – Rob, I'm I'm we're what and the I XXXX. that a about looking probably so revenue happens, revenue for answer the way, it's up don't it that's pretty pumped probably so us, time for XXXX, not mean for impact did sure guessing assuming by XXXX. at it'll bill question? by much that can

Rob Brown

Yes. turn Yes. Thank I'll you. it It over. did.

Charlie Bacon

Rob. you, Thank

Operator

Thank you.

question from ahead. Capital. coming is go next of Gerry Our Sweeney ROTH Please

Gerry Sweeney

for call. Mike, thanks taking Charlie, Jayme, Hey, my good morning,

Charlie Bacon

Good Gerry. morning,

Gerry Sweeney

this, hopefully this appropriately. can I and Question articulate

activities, how we years On on have a good service on the union look – necessarily how service on in You like same at sounds do that at an finding those market have labor or employees go couple issue was cetera. the we we'll do re-engaging basis? service a construction, of the the we it the the you potential labor when on service, Do ago. qualified accelerated labor to we had side, obviously permanent? or go-forward past look issues side, halls, the don't et more How issues say side have side to

Charlie Bacon

our think question, that at, good want it's to looking a growth think you When you we're that. about to I Mike, respond Gerry.

Mike McCann

Sure. Thanks, Gerry.

a I think a good a think perspective. I direct of from couple construction levels labor both we're owner things, and overall stable

to other and the we've our I wanted to best been we've able think interesting perspectives, talent across the we is deploy both thing owner talent done direct utilize and construction. both that

we've So, been stabilize I disciplined we've share shift. is this can to that. labor back the forth, help doing. to But been returns us best what I to obviously definitely talent, being we're guess, and been able on say as and we We're that and leverage really able our and way helpful still that's maximize

Gerry Sweeney

[ph] the put it. preventative we some really is and contracts. anything you're of sticking I I'm won't is of business expand, that even you that? preventative a mentioned, like Charlie absorption business, maintenance you've or there And question. and – out just really potential point there, grows, a of segment of side, with question a the let's the service as But margin increased sort potential that the Got that is then throw overhead of X,XXX maintenance number to think, because the XXXX, If an contracts the timeframe of internals, those I just of a going not leveraging the it don't have say or more on point because for that's just

Charlie Bacon

it's I Well, foundation these resources actually already of over having We've a preventative and reasonable to it's look put think, at X,XXX, Gerry, is years. a the way think, of lot a next place couple in I the it, target contracts, paying maintenance of beauty now years core the The sell been several preventative agreements. doing off. those business. to for service it We've of

now to project to help right, building and want we're there's capital to in You decided they that something them you're help replace asset just it's get new the or to technology through and that some they able deploying got that planning. we've management, we're amazing, with pull something. be breaks going And their

be actually to we'll our on handle to we grow solution. own as have able those revenue digital a off So, better that flows maintenance continue contracts preventative

be suggest XX.X%, would I bring at you to a that, for high strong back gross that going to flow. That's expansion you profit So, range when at us. owner-direct, to cash margin, about It's on is margins But good said not think, XX% more of very investing. to I SG&A, of look past We're year, they keep going think, we're going all I owner-direct, to range XX%. kind out it's is good suggesting, this This our our having that the future. off.

management, continue continue to grow, had we're as just So, our force well as going XXXX, and as we to execution to expand we to segment. grow salesforce, that

I for it savings but, on us expanding. keep would investing could SG&A, to So, some and be there think, be prudent

Gerry Sweeney

is more points. side, completion higher Is refilled up that a of and older Okay, at as contracts then opportunity I to helped XXX more Or change of internally function front. with just And on got on I described, was coming that is margin drive you I moving going just was to lot. new or on it margin? execution some XXX that of side, I'll that's through more curious think, I Construction business, it the contracts, well? a basis that, – some on being I think, backlog, through there that's the it. the pull which But to got. just with to more look as

Mike McCann

take I'll one. Gerry. Thanks this

us, we capacity. I it. we're to Project both critical has outsell been sides very disciplined, that sure our it's think selection being of making don't

definitely management working on sure rigorous opportunity. project, the a do get think maximizing both and procedures of risk got once we're perspective, on side that process we've other and we make we're And out. to proactive closing it from I the and things the performing too,

is really we've I'd on. So, it's both on sides of spectrum say the focused been

Charlie Bacon

put processes calls. to have about over all and management claims What's in we talked something of going place risk just on I'm about add quality the else year that past response. earnings the we've Gerry interesting previous

We some have it's XXX% that's projects paid setting year. claims continue not getting minor execution, no are these But into – into to We've great that new some of not that funded. and we're that's be in back. us it's far nature as it's and to stuff as kind that going – COVID going we substantial have this but legacy do pursuit And on. impacts, work of to we see had

collect good job after working work, get and I get in, a think margin done orchestrating, on smaller has out, it. and Mike make it's let's cash at just we're great going our let’s

Gerry Sweeney

And sometimes on selection project better can was better a I focus absolutely. little just pricing margins. Yes, drive

Charlie Bacon

Yes.

Gerry Sweeney

to was that XXX see basis – I confidence where was coming that from. points. just very And you to confident sound So, want in XXX That’s all.

Charlie Bacon

Yes.

we question answered that hopefully So sure. for

Gerry Sweeney

Yes, perfect. That’s it from me.

I appreciate you. it. So, do Thank

Charlie Bacon

All thanks. right, Jerry,

Operator

you. Thank

is Adam from Thalhimer coming Davis. ahead. question Please next go of Thompson Our

Adam Thalhimer

for good taking Thanks the Hey, morning. questions.

Charlie Bacon

Adam. Hi

Jayme Brooks

Good morning.

Adam Thalhimer

Or making of those your Are interested Charlie, into jobs up March. those construction the decision season? would really projects XXXX comments Hey, in for the when start? mid-February firming kind

Charlie Bacon

just a it's uptick. construction owner a Well, of and the and real both combination direct

So, this the short owner direct very work. cycle that will I again, it's year, happen mean,

take a sudden let's a you couple happen of and and and quickly, at But equipment that of year. looking them a segment look is of at a what fairly go, months larger, you underway customers it. which Construction to couple execute then it are us this burning point, we've projects this some at, planning about might Some some of we're talking that such, and they great. getting got we're getting When significant at the looking lot of customers, the yes, started all of do projects of is

you as see to the well We mean? get what half. go just the to we organized several our Well, to still sales. way of in the let's work half Construction months have see do the then It's burn in to to does year. we'll do. up what half revenue to the ramp going the second pipeline existing It's as first expect for take things second planning go the compared Now and backlog,

construction of So, into backlog year, I'd for building XXXX. XXXX on that's will to this side, it the burn you up but suggest some

Adam Thalhimer

that issue Okay. I segments? Construction equipment availability? in I've Is mean, other heard an with there kind of

Mike McCann

Adam, there I the we work haven't But a been from hasn't seen manufacturers, factor seen lot flows currently necessarily. and the our and of the that perspective, but on obviously that duration far. of so seen of this work. think right business And equipment from depends now we've we've ebbs in the the size a

Adam Thalhimer

next of you're curious and on do requests figure or IAQ out FAD? see durable rolls that's lastly, of vaccine the – think then in And that here it's projects, a fade out, trying kind away those couple good. is on of stay, And kinds years. to once you those going Okay, I'm if of just so the a to lot to –

Charlie Bacon

Adam, pharmaceutical? I'm referring sorry, to are you

Adam Thalhimer

No, quality. indoor air

Charlie Bacon

Yes, many sometimes there's so acronyms of we throw out them. of

Adam Thalhimer

IAQ exactly. yes,

Charlie Bacon

to building, was think, how another to – type are they with putting on and air sure that couple buildings indoor they trying ionization with to that spend were got going a heard a with from it The recently think, I us make I could just they we're And that of branch where to continue going basis, a to districts amount right are the we've in bi-polar on hit district Indoor, million. safe. continue, money district of out to go it. had Yes, figure it's building, where going parents in we're where now K-XX working And school the building, $XX call to precious quality. T&M systems. to There just boards

that we're them as solutions but at offer near will be so, them to there But it well those of think working as try to them. a that. the year, bit us thrown term, quite with this call talking opportunities And I we're they need, and seeing

have but schools. a a XXXX, into with we quality has think clear that mindset. ball, the do enough XXXX, don't that I do do Going indoor be other part sure to legacy I Now there'll good? How air make is crystal

and buildings hoteling, restacked office in impact how figure buildings, with reprogrammed think of to are to everybody think, is I trying I going remote right, out be the work.

we're working of improve. we announced estate. just in real the remote believe way day, the frankly, with thinking Quite other same reduction accuracy, Ford productivity massive

And we're don't come as either. So, estate we looking our as at much leases that need up. real

does though, the has other and indoor Mike, have probably with next year thoughts what air half commercial any do you there construction to lag retrofit space what second the new into spaces They in a be going quality? mean this those So, that year. to into of will proper indoor to happen about that?

Mike McCann

in Yes, reactive were a was XXXX, it, I decisions think, lot there was that what's of interesting made.

things that of think into the we've I proactive people have seen stance. we've gone as a taken is XXXX one key

be really interesting That's over proactive years, seen see this year, but to definitely two it of going first or there's the to pieces it's in the three think too. next I we’ve piece that XXXX. So,

OpEx a mentioned as reactive they've – opposed before approach but OpEx the XXXX. they of took I think in approach the the piece CapEx coming, taken to more As air much I is that its to quality, specific related proactive

Adam Thalhimer

right. All

I your this the I read year, doing but you're were would kind moving larger but be want year those ones in they don't are ticket ticket maybe fewer I to that that more mouth, projects. guess of the forward But seeing that put projects. But smaller So, last filters, way words items, of upgrading are types.

Mike McCann

little a it's say I'd yes. both, Yes. but of bit

think for where larger there's projects to or more aptitude I out you're that right. come of

were reactive ones other smaller, The so.

Adam Thalhimer

Interesting.

Okay.

Thanks Okay. the for time.

Charlie Bacon

You bet. Thanks.

Operator

Thank you.

from question Long next Please Our coming is go Old Meadow ahead. Jon of Investors.

Jon Old

Thanks Hi, good the morning, for call today. everybody.

Charlie Bacon

Good morning, Jon.

Jon Old

for quick question A Jayme.

in of are So, the there was a lot will cash going I'm mirror forward results. in years. interest cash amortization It whether interest prior what expense extra the GAAP clear. savings curious – the

GAAP our savings be savings huge. hoping – equals I'm the think I cash, if GAAP will So,

So, get wanted comment to on that.

Jayme Brooks

got mind run is keep when Those What is in in you amendment that the you've expense item looking to debt to costs. you're – all had item. that. costs. have issuance our in that line line interest at are no, correct Yes, We

by million So costs cash can look interests. get actual you of that last expense, kind other costs amortized at that about year, other of debt when looking the modeling it to and issuance is two And that the thirds at line the item. is in interest $X.X

Jon Old

your forward, is GAAP let's a X% in XXXX number be? if with GAAP interest of million, – interest reported round million, the is to going approximate that $XX But a going take your just Right. cash $X.X does – interest

Jayme Brooks

out that put there. number haven't We

– look on in how it's lower based can at we that is the mean, And you the can I agreement, rate. then fees modeling principal. pay again, down are and rate You the interest

Jon Old

Right.

And net the look that to legacy Okay. most still for you this what think a of just year. do were had have write-downs projects question an large problems. Mike, old amount coming XXXX? like does that we what think end? Maybe – of through that’s would Shouldn't creating a the for moved that on, we be I

Mike McCann

is we've I focused. that key really think with the that is,

associated Sometimes out months, burn these last things off, risk on really XX the we've key take thing with to different but time is management for to sales to pursuits. focused point XX the

So much more rigorous.

going operational disciplined upon based well saying there the both more I our selection, due in upon XXXX, to into team, forward. capabilities strategy, our that being think you're that to a the of based were those correct that due consistency as lot as

Jon Old

mean, be with be management discipline once you should projects, I But close your going it that you've close that risk like should gotten to Okay. zero? zero to and feel forward? number to all respect

Charlie Bacon

the nature But you When you seen some what you standpoint of we've have from our have do. look project. at of the State four LA. write-ups, the progress net Angeles we of write-downs, business, to by stopped And nature requirements to it's coming of out manage the what in due of The in Los continue we've been we is certificate COVID. of doing news. Mid-Atlantic very project working of hits about I by City months which wrapping and out airport the that and their South where punchless. certain just we're pleased, up those And report was was could great occupancy terminal I'm received It do they California to on this that things, at Cal, work extended that done. point, really had big took that of but we February,

with with. to forward, net to risk management all occasionally, would that put to think – on And number So, Jon I that write-ups that that everything but the periods we go of deal going as we we're up. the have in to I a work we've over have But wrapped see expect processes, we're reporting will place. past going has write-down

Jon Old

I understand. I on basis. overall No, that just mean

Charlie Bacon

the seen to right. And past control. any step at new the you if back got do over which nothing conditions, there's and duration as long the of reported other, money projects, due a It into caught that the standpoint on to but about we've large, we're want number where of the that the get then where We something. smaller focused others. some what to today, just definitely the play significant everything numerous magnitude because look, want the look haven't labor at really was situation. looking have couple claim we or we up we're claims we And we're from other, problems we the in in pursue on here past of come But clarify and But over I scale projects trouble. talked calls. I of other way of go we're I've Yes, of year, things those seen under And that into what is earlier we years.

lot We where impacted cost logistics due just are see through really it, were a to think we on We what we're our introducing where risk projects make opportunities work of on at we forward. that. the processes. forward, And XXXX, I Mike's going COVID some of smaller on these a COVID we're but pursue us that splendid doing recovery, to And it. probably couple as things But projects looking opportunity. the and as pursuing rules, size bucks see work like far going That's and is at we're a job done again, sharper us important management selecting.

Jon Old

one for Last me. Okay.

So, now you've significant of cash. amount got raised you've –

got from money You've warrant debt the cetera. refinance, some coming in et proceeds,

a I make work, trying for what your pricing the specific and this loaded know things get are that for the bear. to little doesn't going M&A for be just – color M&A you on a be can't as of be just of but what expectations I year? sort So, year. to expecting more more to have happen. pipeline wanted kind these this your know the little to and disciplined. It's I you're you're you're accomplish to pipeline – all

Charlie Bacon

Sure.

balance And now with we're having course we discussions today discussions our that maintained absolutely that last done. we focused past year some raise we those debt enjoyed refi And a So, priorities we go do businesses the more we where pipeline through relationships were the The with with. the were of in had to right. to resurrecting to aggressive years, seeing decided reinforce sheet. tackle, Goals can had stance. on acquisitions. we of We capital couple

happened that's COVID. past We over with we've it. them have it's happening But year we're arms to the our around get and resourced active, to everything

sure about with right we're take the that. where we find to valuation. the opportunities it's to time right make we're some So, But at going excited going

Jon Old

Okay. Thank you very much.

Charlie Bacon

you, Thank Jon.

Operator

in showing floor Instructions] management no I’m I'd over the this queue to closing additional time. questions comments. back for [Operator like at to turn

Charlie Bacon

thank was We're I'm what a for company laid in with our you everyone the we Look, for and it proper foundation progress joining accomplished XXXX. we've us successful today. And proud very of very of the to year about QX. moves for with shortly talking that. look excited And we forward All you very made, all that continue. to to of the we've here all the the the results progress, best.

Operator

your in Limbach and and interest gentlemen, participation thank Holdings. you Ladies for

time lines day. your and this disconnect may You wonderful have a at

Limbach (LMB) 26 Mar 212020 Q4 Earnings call transcript