Earnings call transcript Q2 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 Second Quarter ended April 30, 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 Camilla. business that outlook. and remind numerous the of regarding that Thanks 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 to 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

in These would state as acquisitions Mountains, of our expectations recent most as Rocky double-digit of Colorado. and This by to exceeded rainfall of well that our we not XX% our experienced segments organic experienced continued accretive Thank all our in above west gains quarter the markets, seventh strong making you, afternoon, quarter driven revenue second was consisted Cody, average results in revenue our am gains. of growth. had good market we across in I of report and growth and have share everyone. growth, pleased consecutive home

large we an and like end perspective, From centers, distribution market EV in semiconductor plants, manufacturing have encouraging warehouses, and plants. battery growth commercial projects primarily seen fabrication

to given companies look out footprint. as this to US continue reshoring expect manufacturing domestic We demand their build trends

is from projects demand comparatively interest Pumping rates for strong, due light some Concrete financing reduced commercial projects to has weaker availability demand commercial large and been impact from While manufacturing, of this, from our commercial expectation summer into the remained for smaller we peak head XXXX market seasons. year Despite construction large banks. in particularly for regional strong. Opportunities fiscal as higher with

Turning to infrastructure.

to public allowed continue results more us revenue it capture footprint national strong drive US as expanding to from Our project investments.

continue will projects, local the which existing tailwind project and visibility Acts, where numerous to to look of flowing operate and has that we five-year-plus to to infrastructure our many a believe in US we in. markets seen We in work are We pursue plan the investment an the forward these opportunities investment located state to of in with and funds be potential business. to for it recently renewed improved JOBS win have projects aggressively

The stable in in value the work, we relatively ongoing our to remained segment imbalance due structural offering of Residential our quarter, second and diverse supply commercial fleet highlighting moderate QX the in demand housing. by absorbed During agility management. the were experienced declines our

points commercial our work percentage since XXXX basis revenue, of with the in growth market. our a as residential of XXX volumes have fiscal traded example, For total end our

experiencing revenue we expect XXXX, the are XX% main of today, For consistent historical residential relatively in the remainder remain line fiscal with is which of revenue trends. to with we

our as particularly by due I above stabilization fuel our rainfall in impacted effect our were average labor Shifting equipment in to to improvements the offset diesel cost mostly that in we utilization. side small business, deleveraging that costs, a of experienced discussed of earlier input

performed. team successfully to same recalibrate on rates of expected investment for continues work the and the equipment volume return all Our segments business across realize our

quarter In walk EBITDA. line will summary, on growth before Iain? great we and provide another through of in our to with growth Iain business I I that to had X% more let financial some continues concluding show adjusted strength details return our XX% results top the remarks.

Iain Humphries

growth. Thanks Carolina, Bruce, X%, UK to of In US everyone. revenue Camfaud quarter. operating but largely under segment, Five year regional in US business prior the afternoon, the also revenues acquisition to compared brand, and from despite increased XX% our good from increased recent dollar exchange Coastal pumping contributions due QX a strong segment, mostly organic foreign headwinds, our

grew translation Excluding revenue the FX impact, by XX%.

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

to Concrete of to the offering. continues This Eco-Pan results, In exceptional by same value investments sales quarter. increasing deliver we enhanced Management ago our the we Services our US Waste compared including XX% service operating year be under by made revenue and segment, our to the continue on an basis brand, in driven organic team the

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

XX.X% margin compared in to Returning was ago same in to results, the quarter. gross year second XX.X% our consolidated the quarter

were improvements lower small earlier, noted to offset due in labor input higher Bruce costs, equipment utilization. costs particularly in As mostly by diesel fuel,

labor editions from in $XX.X year General to were and related result QX $XX.X a quarter, and ago in administrative million million, million higher acquisitions. the primarily as same the $X.X costs up expenses recent of headcount

XX.X% G&A with operating the we quarter. is illustrative to of in the This compared were XX.X% As efficiencies of M&A. a same revenue, in achieve quarter typically through the ago organically as year second and costs we percentage scale

offset year-over-year The interest higher in and than million income tax more realized was operations by $X.X expense. improvement income from by

$X.XX compared in the $X.X to per or per quarter share declined net As income ago slightly quarter. $X.XX or shareholders share common year the million a diluted in result, dilute million same $X.X available to second to

margin year Consolidate quarter and compared Adjusted the X% the ago quarter. XX% $XX.X EBITDA quarter. adjusted same year to in XX.X% to in increased EBITDA declined to $XX.X compared slightly in same million to the second ago million

our results $XX compared Moving impacts compared segment. on ago same and to $XX.X the in to million In million the same the Colorado weather In $X.X Rockies Pumping quarter. leverage. million XX% to X% adjusted US ago in our given declined our business, Concrete west by EBITDA of to the on year year operating EBITDA $X.X business, million increased adjusted to UK quarter,

the $X.X Management EBITDA adjusted Waste year business, Concrete XX% million million to quarter. same ago US in our improved $X.X Services compared For to

liquidity. Turning to

also of XXth, XXth, debt or of XXXX, We total had includes As had cash on to million availability from we liquidity the $XXX while $XXX facility April million. of and million, April to lending at $XXX $XXX XXXX, in $XXX million ABL outstanding its balance June, our net facility. as from which Furthermore, sheet asset-based XXXX. million our maturity week, last debt upsized approximately extending we

welcome support Chase. to further to from continued pursue support relationship team our accretive opportunities the Morgan delighted and Wells our this PNC enhances teams and believe ABL into Bank from JP strategy. our development and Fargo at We ability are long-term We growth the investment overall appreciate the

strong maturing fleet. maturing continued in which with in debt like near Pumping optionality free no facility and added have We term position, notes value in Eco-Pan, we to reminder, XXXX. provides remain Concrete and a accretive senior our cash a and now liquidity maturities pursue investment XXXX in M&A, our As flow opportunities further lending investment asset-based our

for XXX,XXX approximately second In quarter, shares the company $X.X repurchase the million.

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

by we in We are quarters. are into what our business encouraged the momentum and the we're seeing carrying coming that

our result, year a remains fiscal unchanged. financial As outlook XXXX

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

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

Bruce Young

very line segment. In growth expansion every summary, pleased are top quarter in another record Thanks and by driven with double-digit we Iain.

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

our We and broad our markets, and projects. anticipate discussed ongoing given footprint end given capitalize and growth commercial the in we infrastructure growing our heavy them ability on commercial with momentum to trends industry and

leveraging our accretive we continue service construction on end to strategically growth to operational mix focus offering high season. focus capabilities, market into line and while executing leverage. on Our balancing also top non-opportunistic value move deliver bottom maximizing M&A shareholder by strong remains and to as peak summer the optimizing We'll value unique continue our

turn like call the back would operator to that, With I over Q&A. for Camilla? to the

Operator

Thank you sir.

We be [Operator Thank question-and-answer a will now Instructions] conducting you. session.

Tim question from proceed And our will first your Mulrooney with Please with William come question. Blair.

Tim Mulrooney

good Iain, afternoon. Bruce,

Iain Humphries

Hi, Tim.

Bruce Young

Tim. Hi,

Tim Mulrooney

questions here. A couple

Is momentum the up, the growth business it digit of Coastal, the Carolina quarter. second type was you'd US like contribution exclude in I in to if year? of fiscal the second your from looks So heading as revenue it you the expect organic maybe concrete single half low

Iain Humphries

our there would we quarter. well, Yeah. obviously in we weather the as quarter that growth plays talked Tim, the typical. about I you in mean, would've not seen that said million affected thing, maybe impact in million was $X normally about to or $X well. of I obviously what and add as second one the is which weather utilization second

year. side, from this and said obviously and of again weather with add the certainly would you're in the seen than we've QX. quarter expect last we right, the comparable weather a but utilization into a now same I you played QX the year to in on organic breaking, volume So improved improved four, moving more what that would and But part

Tim Mulrooney

Okay. All right.

growth really we're maybe how is single to organic business like sounds it trending. normalized high is that digit mid talking So

basis, about you the on split you that how up thinking normalized business? and If pricing are volume between a

Iain Humphries

that. to Yeah. think Good way about

X%, So X% said looking about volume, on organic. was and X% Of XX% price. at side then the year-over-year the organic, on there's second it's quarter, growth. that you so M&A X% like X%

Tim Mulrooney

it. Got

So still a environment. strong pricing

The I think down US a Just you if they mind. were margins, bit don't little one Pumping. Concrete more EBITDA from in me

think half you excess expansion an get without contraction year. idea What in that to the to the Just we from impact? you're trying about EBITDA or quantify had impact curious the to think the Just been able how as of would've margin rainfall? margin if

Iain Humphries

make question. Yeah. on stabilized There's on and Good weather that other that most in labor some The was impact from around thing is the has on half. would the inflation inflation other still quarter lagging side. the about half. half fuel the up EBITDA margin effects One second

hangover on that margin. inflation a of still bit there's the piece So a little in

Tim Mulrooney

Got it. taking Thanks so questions. my for much

Bruce Young

Thanks Tim.

Operator

Thank you. Instructions] [Operator

question Davidson. will with from your question. Thielman with come next Our Brent D.A. Please proceed

Brent Thielman

-- that Good thanks. guys. following about the up related Iain, afternoon, compression Hey last on just to inflation. margin of some Hey, just comment

As I about thinking think here. with some other here costs, the fuel looks you impacts mentioned, fuel be abating, business? would inflationary we'd in abated it's runway sort to of of just on it factors have I terms that half from degree. What margins sort in second some like the you'd

Iain Humphries

Yeah. Certainly utilization utilization three when and the earlier. weather with that this improved Most going mentioned comes I through of affected as quarter you've second got It's piece. quarter from hard four.

in a so margin slight we and in But QX is then we're comes that which which where more utilization. of from mostly expect looking in feeds element the pull turn through and utilization on labor generates into see utilization inflation of the yeah, margin the QX we improved a improvement around and our the of you're of equipment, cost. obviously that There have to lot there, four. the four typical employees, forward nicely So

Brent Thielman

particularly the tough see half out guess, do -- can is obviously too. actually second can there's I'm of the guys some much back you still you given think about in here first you just for? get volume Okay. significant with second And snap constraints work How just felt year and there the into you just the there's some this experienced you think in tough how the half in a associated half up done. terms curious first about can of in quarter you how pressures weather. back of make I'm west lot that pretty weather, of snap I the

Bruce Young

as and are in nicely. the good the next and really yet, that. Bidding Yeah. are has question, really for about activity becoming hasn't really dollars now, impact in or expect as right fairly that The The soon responding into Thanks We've strong. commercial. becoming that is could QX stronger. The project infrastructure and to Brent. and clear bidding where commercial year while start in bill conversation started some now are we been market the commercial feel starts the we activity that on started markets the on later really is revenues well. And have allocated year that into well good

Brent Thielman

Okay. that'd commercial guess opportunities data I of one commercial And larger parse the out, much these wondering, more. of centers, Bruce, vertical? manufacturing I'm lighter just maybe toward you helpful. evolved how that warehouses? or the number you if seeing still mean, projects, just sort fair kind has could I Maybe business of are of a within be the trended

Bruce Young

than a market significantly but what would seen. percentage, part say We of as larger our become projects the we've of volume the don't that commercial have greater separate I out a

Brent Thielman

Yeah.

it All I'll you. Great, Okay. pass Thank guys. on. right.

Bruce Young

Thanks Brent.

Operator

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

remarks. for closing Young

Bruce Young

to everyone results forward speaking you, Camilla. and for September. with Thank fiscal listening to in today's quarter Thank you. We'd our like thank third XXXX's call when into report look you

Operator

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

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

Concrete Pumping (BBCP) 8 Jun 232023 Q2 Earnings call transcript