Earnings call transcript Q1 2023

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Operator

Good afternoon, everyone, and thank you for participating in today's conference call to discuss Concrete Pumping Holdings’ Financial Results for the First Quarter ended January 31, 2023.

Joining us today are Concrete Pumping Holdings' CEO, Bruce Young; CFO, Iain Humphries and Company's External Director of Investor Relations, Cody Slach.

Before we go further, I'd like to turn the call over to Mr. Slach to read the company's Safe Harbor statement within the meaning of the Private Securities Litigation Reform Act of 1995. That provides important cautions regarding forward-looking statements.

ahead. go please Cody,

Cody Slach

statements like uncertainties call everyone better to we to to from certain our I'd These materially and course are differ could statements understanding in cause of operations, subject forward-looking making be this give risks will statements. our to you. business that outlook. and remind numerous the of regarding that Thank such you results a actual

quarterly annual these the concerning see and on otherwise. report, other on and risks result XX-K, disclaims SEC. any with Holdings’ information For intention to Concrete publicly Form or forward-looking any of or as uncertainties, revise statements, report company filings a XX-Q information, Form new obligation events Pumping available or whether update The future

also further non-GAAP adjusted certain non-GAAP posted call, about On or press believe financial free flow, release will the provide today's company's issued net today financial EBITDA, and GAAP useful to presentation which we We information website. our including provide investors. cash on the in we and investor comparable debt reconciliations measures these the measures for measures, information reference

also this I will be later on as this would that webcast website. link evening. in via available call A release, to replay replay for like as well the available remind will provided be press everyone today's the company's

the website. presentation company's have we on updated an Additionally, investor posted

Concrete Pumping Young? like turn to Bruce to CEO the Holdings, would I of over Now, call Bruce? the

Bruce Young

which contributions by sixth of all to quarter that XXXX off share start revenue and is growth Thank consolidated revenue through with acquisitions. strong organic market accretive you, afternoon, of gains consisted marks was quarter segments from and This consecutive Cody, our to growth first am our good driven across double-digit I growth, report continued and of growth. everyone. a pleased XX%

and U.K. Our weather and not markets. had have U.S. were severe in expectations experienced winter abnormally our quarter expectations the would line for if the in with results exceeded we

Now turning segments. to our individual reporting

performance commercial first and continues recent business market. of share us our our were in We driven growth win U.S. pumping market with successfully position and by in growing national increased our our X% end commercial well Our completed continued through in offerings quarter large strong strategic breadth service acquisitions footprint our our in XXXX. and to complex organic to Of integrating customers. acquisitions projects note, successful

within projects include chip these of plants, plants, buildings, battery market. end examples centers, facilities, Some centers electric data our office warehouses, and vehicle commercial distribution

as of XX chip as in as average early two reference, in size still battery as an an and the storey average buildings buildings. XX much storey much For construction plant, size four concrete concrete there's there's plant,

to Turning infrastructure.

footprint it from national revenue to allowed public drive to capture U.S. continued expanded project us more results investments. Our as

look local and We the forward Act to state projects renewed win U.S. work in the will and continue the and Investment with in Infrastructure levels the Jobs the Act. Statues enactment CHIPS regarding and the of to investment to Federal

to that estimate. to However, yet meaningful legislation and difficult the is outlook directly at to projected any new are time, have see new emerge projects related somewhat we this

expected to come first other challenges structural quarter, the market from in end ongoing residential imbalance work. the During quarter due We volume and supply margin the the by as first relatively affordability the our was to stable, continues market residential housing remained driven that in higher demand moderate recognize unwind. change the absorbed

end agility compared higher offering market our of approach. total XXX of markets. a work with of management advantages residential as which typically our in The volumes change to our illustrate the basis our fleet revenue carries growth our margins, in percentage revenue, and in diverse end other commercial market, points distribution For the example, our traded by

and X%, translation excluding increased In XX%. headwind year quarter impact, U.S. grew exchange revenue compared the foreign the U.K. segment, revenues FX dollar despite prior our by to

Our with beyond addition to high team previously concrete to in work the speed road incentive, we rail XXXX. announced have to expected continues which the last is secure and railway projects energy, project HSX,

our deliver compared In team exceptional continue ago country we with our growth QX expanded in driven same of service management the XX% revenue enhanced offering. to to waste of value quarter by organic business, XXXX, the and year sales Eco-Pan, our

evolution Eco-Pan's we Going team penetration forward, equipment, growth maintain concrete and its and contain investment the given methods our the revenue in projects in to used the expected washout concrete to continued double-digit our market of organic the in construction continued material.

our Consequently, as we all costs remove quarter, team Shifting business, line offset was have our continues that dollars the in cost the expectations, our to are we case resistant the successfully in that recalibrate higher remain our largely will side pressures. to last if rates across margin the of segments. with business inflationary input

equipment we for result, performed. a to volume As the work investment on return continue the realize expected of same

to the show So business. of in had continues another that our strength great summary, we quarter

more I Iain? walk results let to I remarks. through return concluding on Ian some details provide financial will before our

Iain Humphries

Thanks year improvements. Bruce to double-digit $XX.X the quarter. quarter, Eco-Pan $XX.X and ago compared XX% revenue to increased The solid organic growth million in growth and was in continued revenue In acquisitions, volume good result afternoon, in first of recent a million, everyone. pricing growth the same

same compared brand segment in Concrete million, in operating approximately to Revenue million quarter. year to Pumping U.S. $XXX.X under increased mostly Brundage-Bone the prior $XX the X% our

the Excluding organic line weather against unseasonably weather, of comparison prior ago winter the backdrop on the largely quarter in the last same acquisition to effect in an the dry Revenue severe year basis. the and especially and of same year. warm experienced coastal quarter in adverse with of was

brand, exchange operations pound, largely quarter. U.K. $XX to approximately ago XX% first million, U.K. the in revenue quarter. same improved the foreign British Camfaud operations the our year effects, in operating X% compared million revenue increased excluding for under the to But the our from For weakening $XX.X translation

driven $XX.X investment in million increased in the and by Management in growth to was Revenue the XX% and Concrete Waste equipment; increase in strong continued volume. Eco-Pan team The pricing; in our U.S. segment first our under pan operating sustained organic our pickup improvement quarter. in revenue the Services brand

and pleased team's our execution successfully dedicated of efforts the value by extremely Eco-Pan sell are We offering. our to

an consolidated our decrease compared quarter directly order more quarter. due cost XXX-basis provide the quarter, price. margin XX.X% To estimate the in margin of pressures, to year approximately margin to year's we was The in by slight diesel results. the to to was ago or impacted continued XX%, fuel Returning related fuel. same the versus is first $X in points higher Gross of magnitude quarter first million last diesel in than particularly gross inflationary

million, in same the by to quarter. year headcount from we cost $XX.X million labor first $XX experienced cost more quarter, but compared offset primarily amortization In expenses intangibles, General this and administrative than in was increases of recent ago acquisitions. QX the and were lower

quarter. compared and As first the as through ago a G&A percentage XX.X% same environment. operating in XX.X% of of year quarter, to the is of revenue, in both efficiencies our the costs M&A operating illustrative regardless This were organically scale we

organic due profit revenue a change result the favorable value in the growth in fair share and Net same million or per the share, $X.X contributions increased and or first gross common shareholders the of ago in was improvement both income from $X.X a million available to to diluted of quarter. $X.XX quarter improvement $X.XX to diluted to in compared million year The acquired warrants. per $X

EBITDA in our $XX million, business, XX.X%, year $XX.X compared adjusted EBITDA the quarter. to X% to XX.X% to compared the same in in declined Concrete the $XX.X to million, improved growth. in revenue million margin million to increased Consolidated quarter Adjusted X% U.S. to ago EBITDA year driven same Pumping year first by ago slightly adjusted our the same quarter. quarter, In compared $XX.X ago

concrete the in year revenue is ago inflationary In growth quarter, million, $X.X diesel a ago XX% offset fuel our million pressures, with to costs. million, EBITDA primarily our U.K. improved EBITDA $X.X same the In line management compared in same quarter. waste business, adjusted adjusted was $X.X was business, to in year by which largely U.S. strong

XX, approximately we in from debt of $XXX to $XXX million. facility. balance XXXX, debt had XX, sheet the as turning on million net $XXX our and ABL outstanding liquidity XXXX, includes January We liquidity. Now cash of had million which of or On January total availability

no our asset-based Difficulty] notes we senior lending [Technical and a near-term with have debt maturities As facility reminder,

Operator

gentlemen, connected. and stay kindly Ladies

management. We the the line have of lost

We Please connecting stay soon. back will connected. be Thank you.

Thank you ladies gentlemen. for patiently holding, and

to reconnected. the gentlemen. Over management's you, line have We

Iain Humphries

X% Hi, year same margin I is drop. for in to revenue Iain quarter, $XX.X slightly in our Adjusted drop compared year improved thanks. growth. will adjusted start compared This $XX.X the same EBITDA increased U.S. adjusted same ago the Concrete business, $XX.X to $XX, EBITDA. we apology to Pumping consolidated to line, Humphries XX.X% the first ago In compared to by I'm quarter. driven million, year in which declined million XX.X%, where the quarter, sure our In X% the EBITDA quarter. our in from to ago not

In costs. our same was our was largely as by inflationary offset U.S. million, with U.K. ago in business, adjusted primarily revenue the pressures, diesel -- which year strong $X.X growth line in is quarter in EBITDA fuel

U.S. ago EBITDA improved management to For to waste quarter. XX% $X.X concrete our business, same $X.X adjusted the year in million million, compared

ABL balance which XXXX, on We as $XXX Turning $XXX we availability in of net facility. sheet of the XXXX, million. quarter from debt debt million million January XX, outstanding as or liquidity, XX, our had approximately at to and total cash had of $XXX the January includes

we senior XXXX. As a maturities our lending near-term have no facility notes and reminder, maturing with debt in asset-based

$X.X accretive flow the and repurchased Concrete liquidity to to In shares pursue growth for Pumping quarter like opportunities provides a investment XXXX, Eco-Pan further overall strategy. million. remain M&A support value-added our the cash and company position, cash strong in of investment and continued We long-term the optionality flow XXX,XXX which in first position, Fleet

XXXX, under repurchase January the of share approximately remaining As $XX.X million XX, authorization. we had

year unchanged. XXXX remains financial Our fiscal outlook

CapEx, and to As Operationally confidence EBITDA stated $XXX EBITDA, and and solid revenue to range in range between million cash of foundation year as between a $XX $XXX free a adjusted and expect less range executing strategy. million, between less our growth previously and we million. XXXX million flow, financially, million we for we replacement define adjusted we fiscal have continue $XXX reminder paid to interest million have which cash $XXX guidance, to and net our $XX

turn will now over call to I the back Bruce. that, With

Bruce Young

first quarter. display this was Iain. In our again summary, Thanks, strength on the business of for once

double-digit pleased quarter by are with driven growth segment. every We expansion another and and bottom-line in very top record

high service and We industry, and us mission offering our service well continue of compelling the which out proposition of necessity XXXX construction critical in the prove beyond. value to for business the our positions

to today. think high demand business conviction continue commercial is are due our infrastructure will that about experiencing where we we and strong As we have factors positioned, have to

may volumes recent and of business rates commercial some practical for good fluctuate our to spending give business only year. consumer interest up is and to infrastructure our elevated assume and it throughout Given indicators ground the weakening, us residential

However, volumes this and management ensure scale market, the end fleet model construction of we region management one our is resilience in change an of or agility to adjust example we fleet optimize our business and where on driving our in organic equipment is utilization. growth strategy believe execution through value. best focused and continue We providing investing to we shareholder this in remain superior the path of the to M&A growth

to turn would Q&A. to With the call like now [Indiscernible]? that, operator for back the I

Operator

you. Thank

our We conducting the go [Operator Instructions] take with ahead. question-and-answer Please line will William first Mulrooney Blair. of now Tim session. question be from a We

Sam Kusswurm

Kusswurm Bruce, I hope Sam is this Hey, well. you're Tim. doing Iain for on

Iain Humphries

Hi, Sam.

Bruce Young

Sam. Hey,

Sam Kusswurm

broadly volume organic let's conversations I'm rates if I surprises. growth here. I you breakout year. your said increases? the there pricing wondering I down gone maybe more were start and customers. your start any and you in the those how was if open expectations were your with could between with have or was conversations comment about guess, I for receptive customers and you the believe And us hoping align if break pricing of to

Iain Humphries

on question. In U.S. changes on XX-XX right by little the some to the break QX, a between in it just between down segment the QX define price that Yes, you was the growth I and would of say Eco-Pan volume for Sam. now based harder if on. it's Thanks about for segment, segment.

weather market end the the You the talk heard impact on of pricing. and us about change

we'll quarter. on and So for inorganic the see for a pricing X% the probably X% as guidance the on on second U.S. was volume reminder, around more in ‘XX the price. Pumping But volume clarity side

Sam Kusswurm

of that curious your general. That's I it ask of very acquisition name thoughts your and to the more Maybe know, get about like acquisition was the you a businesses, clarify M&A, switching Cherokee to supplier Cherokee on you. gears just Got wanted I of might on seemed me to helpful. and be it Maybe in concrete. can Materials, you more use the

Bruce Young

Sam. Hi, This Bruce. is

own largely not We small We business. So company, that company. mixed their then bar did molds business beauty bought is a what do our of ready do. we pumping that Cherokee the and to very playgrounds and March, with or buy what concrete part machine piece basically mixed does of a blows of well tucks that one landscaping, they outside ready equipment but in

Sam Kusswurm

Got it. Appreciate leave I’ll it the there. color. Thanks.

Bruce Young

you. Thank

Operator

next take Brent question ahead. Thielman with from line D.A. Please Davidson. We'll our you. of Thank the go

Brent Thielman

guys. Hey, thanks. Good afternoon,

Iain Humphries

Hi, Brent.

Brent Thielman

just I to Hey, question. to wanted the come back last

I something guess forward you're it if quarter like you think this about U.S. it's business flat in had to organic. the up last fast XX%, I pumping looks and quarter, priced like

quarter out volume trying completely here, that Understanding organic at infer offset we a it. a the on flush of the that just little side. but weather lot can So made up in degree there's that more to like some and

Iain Humphries

Yes.

On mean, it around mentioned, the as Obviously, headwind organic was I the pricing side, the the quarter I mean, Bruce weather. continues. in the recalibration, mostly

So at level. weather the through, have summary it I just little within to recalibration the it's team. the when mean, you a But you looking price see trickier change continues the end have rates, like of in a pull seeing impact, market, the the

Brent Thielman

Okay.

of that get And think severe busier margins really there in period think margins? Is the segment, last about third the I leverage I to be that's you we guess or forwarding, just it prior was more thinking Okay, you skewed margins adverse and else as think you than in that here anything saw fast get And I quarter, weather to great. certainly we I what do the in what in into not then, quarter? the for about compression need, versus about just should how to sticking guess, ability second the getting segment just guess the quarter. quarter, year is that work, out in

Iain Humphries

first, Yes. year going I the I'll see performed part -- the the take so profile, last on as we question, last to same of but expect in even in margin that in mean forward. just

part has margins. I have don't new in you're the that expect much across slightly it country. January. colder mid weather, the adverse of [Indiscernible] we Obviously, of effect, current really So part weather was And of any right, mean, there. mean, the quarter. from wetter and much that the the the only I in was through The an anytime we've you mid change change on December seen quarter that

fuel. And about the our never you it last had point thing mentioned, in just basis XXX we prepared remarks. in was change There

So in fuel will the inflation but from I the a and year-over-year are those perspective, first really to we've of combination the effects price lap quarter. that we've what seen start seen, mean, the

Brent Thielman

Okay.

markets, some progress on that one, kind reminder again great you've in now right business density Eco-Pan. last just got your Maybe and of next Just a for where expansion? thoughts

Bruce Young

Yes.

last as better margins over now in there. that the that as obviously years we volume markets few we density smaller getting started create these we are creating of enough density get many the So route or

really of do to speak, a the as we We part publicly. have a want we that good into areas few we're been that's announce moving nothing but story. So, that

Brent Thielman

Fair Okay. Thanks guys. enough. Appreciate it.

Bruce Young

you. Thank

Operator

you. question Andrew the Wittmann Baird. take Please Thank go next from of We'll ahead. with line

Andrew Wittmann

feels Yes, going like on fiscal great. on of the on prior you to kind comment expand guys this getting maybe could just bit neutral second is ‘XX come that, going I here. as have is some expect comments Iain, going you to year the think. if start fuel, a Or quarter, I it I'm in a second just to -- you to slightly But of results. you're improvement? just for mean guidance position, pretty guess, little of that margin to the you the some that. Do going percentage your And quarter believe you margin that's second-half showing year? actual think I up do over the the more start

Iain Humphries

business. normal you part I question, with lowest good slowest our seasonality Yes, often our margin as business. know I of and is of and seen before mean, as Andy. Yes, our mean, QX we've

We some is guide the about performance progression good see feel to through terms we And of the back margin as expect on yes, the margin year. expect comment that are well. so full-year still the So where answer lap we've see the starting your quite that to aspect mean, fuel in for diesel the to on we inflation stabilization to price, of diesel fuel, got I fuel on we soon.

there So normalized on a price. will be fuel the

certainly We on haven't is seen stabilizing, yet pricing, it come but it down Andy.

Andrew Wittmann

do the guess to how I you that's then far? not affecting weather right. and go the affecting next? I -- where guess want quarter, so in comments you I any second All on or Okay.

Iain Humphries

it point, has of this been expected February was to March To kind normal. we and back be about where to

QX we have should we revenues So expected. think very normal

Andrew Wittmann

it. Got

I intermediate or it in that HSX your how economy in that's almost common Okay. if to into Parliament, up the now either plan plan go the factors yesterday existing some long-term right a inflationary you've of near could at the term about guess slowing or plan? global topic that I things so and due factors discussion talking you're to had orders was least any wondering, when of down a just going decade lots another came change recognizing as this the are under marching now. in

Iain Humphries

Yes.

affect current put the we're have on projects on hold. currently aren't not of that startup sections. the This So been additional may

than So more year. an be into if this there would next is issue, year it

Andrew Wittmann

Okay.

that in about the to the summer telling business in I the guess gave performed do season? market now residential understand what backlog just right detail about how the change of residential, that you But then realizing build on mix on trying percentage can like I And math look we'll the guess what's terms that does Okay. overall. you backlog talk some on us you

Bruce Young

Yes.

very slow we're us that but very to continue tells projects. our going commercial to that much becoming So the stronger with down, market is fortunate it's large backlog

over able as up pick last that continue and down, So commercial seen been year. the two the and slowed to you've we as it to that's we've to going through offset think the quarters infrastructure

Andrew Wittmann

it. Got

Thank it Okay. you I'll leave very there. much.

Bruce Young

Andy. Thanks,

Operator

We’ll next Thank question Stanley line Please you. take our Instructions] ahead. [Operator go from the Stifel. of with Elliott

Stanley Elliott

Hey, taking guys Iain, question. for you Bruce. thank the Hey,

Bruce Young

Stanley. Hi,

Stanley Elliott

just you Is down down kind XX is the could of again side? residential out, four you the guys number remind help four what XX, us end revenue less, XX% us to down the embedded like on some triangulate Of markets? that trying of have more,

Iain Humphries

Yes.

we haven't that will shift really publicly where end announced So think up. we

got know, where GFC. More end market find it's us as for normal year. we're this you XX% ourselves XX% Now somewhere of was revenue point had between been the last of since year, we the I XX% to going where revenue that's where point a that's and to the to our highest grown really our the think residential, and

Stanley Elliott

to And would to of be you on where the they Are from to better the a into slip are CapEx some your has of help your able year? -- could you going you requests next us be with piece, Just have out? Is that fill that getting that velocity OEMs? there anything CapEx all risk great?

Iain Humphries

could There pretty it getting is timely. things the a It's little U.S. U.K. may fairly there won't lot. possibility a in the job a of in that We've a more be but challenging slippage, done some happen. But that be delivered good

Stanley Elliott

put people markets, that the And trajectory on us to anything with as Eco-Pan kind the how could it has, other business are seeing landscape, moving with business as ramp? competitive anything the the you into performing of well help

Iain Humphries

Yes.

cats significant couple been great have building great So team started have I over we've a do some the results we years. out. race market, And going us, has of you'll that but got that for Nothing that got a it's forward really relationships, we've a good been years that. has towards few last to see that think small really, around copy with

Stanley Elliott

which those breaking ground, all do you talk pump to going you projects, to you start finally, when When those think for about. of and everybody or start you some projects? battery then plants not will And concrete when about you're larger these excited but -- to only see do actually start mega

Iain Humphries

they'll recently quarter. next be breaking contracts ground received this several projects on of within We've and those

see summer over coming next year. impact we the into So strong quite of that the and

Stanley Elliott

Perfect guys. best That's it for luck. much me. the of Thanks for so

Bruce Young

Stanley. Thanks, All right.

Operator

next line you. Fisher the take Please of from UBS. question our ahead. with Thank go We'll Steven

Steven Fisher

Thanks. Good afternoon.

Bruce Young

Hi, Steve.

Steven Fisher

cost how targeting? the or extent costs what or into be to keep of utilization fleets at you if to logistical it in might that you before? hadn't efforts To harder that like. I'm you'd utilization? wondering there manage lines requiring things you're some easier getting maintain the more Hi, terms is that that profit the maybe anticipated there's and it flowing Is like utilization any

Iain Humphries

buildings. utilized only We of of rise There's really that with the specialty point each ordinary a of haven't had that and in activity might it's lot into more equipment, way I in to is nothing now outside more the that to we placing little high that that move significant around, the a change all mean, fleets -- and a thing equipment but becoming, that. of been use it's had we've bit The on rise location. our size our where booms out high

Steven Fisher

your Okay. talked And to customer deliver machines. you of being able view about

So or might you're be project terms timing? curious of I of that in how supply affecting industry construction impacts and on the chain projects seeing what guess, view there your about broader I'm

Bruce Young

concerns when comes any hearing issues We That's sort see steel concrete and those year. little with thing something there don't steel that are along -- that cement lines. we that some of especially there's things see bit this we're any a aggregates, supplier structures, not it of or

that So delayed, had because for jobs been the most have minor. part, been of that any

Steven Fisher

of the momentum? you sort anything steady, lastly, momentum of doing? seeing just you more the markets momentum, increasing on commercial of which there's And any Great. ones business, which types Are little if have, comments could any are color giving losing within holding side a then are

Iain Humphries

hit, will large for do was plants, year Even large and seen there's gaining In completely hospitality in what our those facilities us but spot, the that's COVID this every concrete the in positive for run nearly sweet we're time. when of what our commercial they're segment. And than sector, has it gotten amounts of after projects momentum and at. manufacturing period stopped better very Yes. we've really those best that's and some all chip we much

Steven Fisher

rates having impact not particular And not -- the you obviously, piece particular but interest seeing general? resi on any any so having on know talked are I non-resi you in impact about

Iain Humphries

Not this and it time, quite in we at point expect continue. to gotten it’s actually strong

Steven Fisher

Okay. Very good. you. Thank

Bruce Young

Thank you.

Operator

Thank call to you. At our now this back I the concludes this session. turn question-and-answer to time, Mr. over would like

for Young closing remarks. Over to you, sir.

Bruce Young

Thank to you, second fiscal thank for forward [Indiscernible]. and to you with we report We’d like we everyone speaking Thank listening to XXXX June. look today's quarter in call and you. our results

Operator

Thank and today's Ladies this does conclude you. teleconference. gentlemen,

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

Concrete Pumping (BBCP) 9 Mar 232023 Q1 Earnings call transcript