ATCX - Earnings call transcript Q4 2020 | Atlas Technical Consultants Inc

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Operator

Hello, and welcome to the Atlas Technical Consultants' Fourth Quarter and Full Year 2020 Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. I would now like to turn this call over to your host, Mr. David Quinn, Chief Financial Officer. Thank you.

sir. begin may You

David Quinn

note, joining be We quarter seen hope after of this at today. release for presentation website posted XXXX support our in in our full the conference issued of Please closed market call. that which the have our you also and a can fourth call, year earnings we found Thank oneatlas.com. you section have Investors

Any statements. may statements Please would I to Commission you include recent like and those plans, could forward-looking statements to such a future call the expectations, any We actual assumptions Securities identify see statements. which affect that with anticipated and our Before results. forecasts we variety and begin, no reasons, forward-looking our from assume company's our for our of strategies, describing of filings that uncertainties remind Exchange many principal may which the forward-looking obligation goals, Please beliefs, risks and today's are differ the by results prospects statements. projections, that are publicly note business control. update forward-looking beyond

In adjusted release measures. to margins. EBITDA will adjusted today, see non-GAAP and directly comparable these most addition, their certain a financial including be discussing or our reconciliation for and we measures filings Please of EBITDA providing non-GAAP measure. GAAP

turn X. call business to up At run with financials a open joined point, our continue Slide the Joe for Chief by of through our pick today and Executive I agenda over will am on Boyer, this before Moving and I our to Joe who X. questions. we discussion I to will Slide on operating up it a Officer, outlook will overview update,

Joe Boyer

thank the made have tireless like that our company our have work our the appreciate you, we and despite team they more by temperatures the full many XX you in members afternoon, prolonged Since caused recently faced months. surrounding includes of freezing unfortunate first of team Atlas to the past August our on states, every which hardship February, it. year for colleagues. possible. Texas celebrated view have our we set transformed full all efforts one for Thank the for pandemic. tremendous strong That becoming the up the I'd thank a impacted challenges public as many of joining dramatically over done we brought the In company. market of up us. many landscape our firmed we produce In public I business And expectations and Dave, results. Good year to fronts. The they've evolving the

aligned Our strategy revenue directly of for end year we'll mission-critical, with contracts of and our business are the see million. our of and three In the adjusted XXXX, our goals solid won by of base. And significant executed and success business acquisitions gross is the on year that a sheet of delivered recent lenders. share our our that of teams full EBIT recapitalization backlog. $XX.X catalysts exciting of capital million at balance The today also stronger about these $XXX our we more validation growth a resilient with through $XXX we million number

resilient as and quarter evidenced and accomplishments submitted pleased cash performance, met in Atlas by X, year. Slide reflected please. our fourth backlog. flow a results, expectations adjusted in and our and revenue, We're exceptional our to EBITDA, financial non-discretionary compliance solid leader infrastructure resilient year finish full and driven culminated quarter our services. which Moving Fourth This return as very predictable a with the in XXXX to strong, the to

of focus recovery driven Sunshine markets we of driven our as Regulatory projects largely and these material markets, their as transportation critical outsourcing we services announced. fueled infrastructure services growth, to revenue provide gross on have the by delivered end continued Our we continued previously in large quarter, platform. related well including the states continues drove work, the that of many the $XXX.X For Atlas expanding and the by million strength benefit technical commercial DOT in contracts,

mix leveraging aspects more Our M&A of net million and gross of our have to even deleverage $XX.X our transformative first planned now provided acquisitions with our acquisition underpins our WesTest to based continues revenue of as earnings, and to represents optimize above in a in our of agreement strategy revenues through providers. more our with a reliance performance of growth through M&A while These strategy, was EBITDA Long continued at anticipated our our Combined capital the work. be our February. Adjusted level Engineering, ahead. strategy depth simplify growth party exemplified those expectations XX% key attractive, AEL our in of sustained on consistent our recent reducing in de structure the Vista M&A. exciting third services February pipeline piece execute been accretive XXXX Alta expansion work our Starting on steps definitive goal self-performance to and of to our are in to and strength, with reflects an with XXXX opportunities acquisitions all business line our our the XXXX. by customers, of

reduced we our further, favorable more borrowing discuss our consolidate fully equity. our preferred will terms, debt and on costs David redeemed As

end cash This expanding to to our in have enhanced increased continue and our together flexibility, flow improve. liquidity our markets our unlocked business with to to invest and grow better additional positions as growth. backlog, We our outperform

to up company of professionals set Myers as in infrastructure Officer; Jamie industry-seasoned the Jain out Priya is our phase coming Chief Growth have Chief with our our built Officer. team the and as team we Diversity leadership joins to public excel. strengthened months, our growth us XX next as years. We've past In fuel the Our

in through work. from a in mainly and of our outperformed end sector end our performance with to Now line expectations Slide market our government-based walk Beginning past, work, performance the discussed business, XX% terms please platform. which perspective. the private resilient accounts government-based we've turn and business roughly transportation also for growth service I'll X. our In on driving our year Today, throughout of excelled our remain markets,

private our commercial the at in trough which business, are market, Our the and XX% demand since up other healthy recovering steadily end growth of pace, a makes seeing improving mid-XXXX.

inspection resilient be engineering and four and services, Moving our or to services, across lines management to program, certification Certification service design. approximately XX% include now about our represents environmental construction and service a business and Testing, our we will lines, services, quarter and our for finally, services. across call Margin year-over-year, which reflecting by portfolio beginning performance overall the or same. discuss TIC lines relatively consistent, point are grew testing, those PCQM of at service volume the which quality of we what demand the one this Inspection proportion

business work makes XX% of our and double-digit and of in our the up offering contribution the service low PCQM roughly growth acquisitions. Our given volume XXXX in delivered transportation strength

business been infrastructure mid-teen percentage strong design transportation work XXXX. and of likewise represent business has engineering and range in growing our XX% supporting Our to in the

due building which see areas and portion a third We in a side, roughly environmental COVID-XX-driven environmental our did substantial business, sciences of the of platform. here. diligence of represented our in On is impacts XXXX these

confident offerings, coming lines XXXX into we about we is and business. leave service on More It delayed backlog trends the major opportunities. the our move important to to our expect of to and improvements along future solidly online, in previously project service as growth substantially of us funded, continue point. our I'll forward additional wins our these with expand that broadly so continued generate in Fortunately, work the or new our coming rebounded have fully which ESG-related as based projects quarters. see on fourth are in wins optimistic on quarter reiterate back the XXXX revenue are

quarter municipalities Georgia to regulatory work performance. state upward project well strong, to Major X to backlog remain to all On contract reinforce wins, and XXXX a significantly of another services, on wins few services and demand this continue wins Atlas. quarter companies outsourcing we throughout our Moving sound essential which agencies Fourth contract private the and project of by our Texas wins geographies. marked propelled as summarize the of trend like our driven as contribute our Slide key key in slide, please. of compliance

seen pandemic induced a the activity move in challenges. We macro pickup have in and also California past we as New especially York,

coverage our project of project Our at strategy These Vista’s long-standing in pursuing especially wins of gross represents customers wins and contributed acquisitions million source revenue existing Transportation. multimillion-dollar ability exemplified our greater of integration additional than services the Alta providing to strong midpoint of of projects paying relationships others, and California is XXXX. have our in Department to by also to backlog, wins, which of with as has The XXX% larger revenue. off, win range key $X million contract expected to project awards, $XXX the amongst through added projects

have strong of projects, our drive the our resources with that technical marquee national to We pursue project of awards solid confidence continue larger work, to our qualifications scale in depth performance professional will and pipeline more future.

growth turn trajectory, to Slide please turning Now to X.

through couldn't be years. our of on Our M&A the organically efforts. impacts, performance past achieved Considering of acquisitions organic results I progress tremendous the builds over the growth more and with XXXX XXXX in five and we've the the COVID resiliency our pleased

base. our The results service acquisitions offerings execute of strategic contributed performance to in our leveraging collectively acquisitions continue customer for year. and expand XXXX, We accretive the exceeded and geographic to favorably enhance completed expectations our de to

acquire demonstrate York activity business access our tri-state will organically acquisitions technical XXXX to in robust through capacity a announced our reach M&A into propel DDTL turn agreement new to capital David, that, that the it help our strengthening to path of strong pipeline region. combined Our in and this start platform our great deleveraging our over growing strategy off capabilities with XXXX. the service a M&A And Expanded with and XX% New earnings is capabilities to XX% to through already our AEL, our I'll the with our further Atlas with backlog we're of please. expand geographic on

David Quinn

and Thanks, Joe, good everyone. afternoon,

the objective. in trajectory so complexity on results extremely priorities. have do in capital our the highly largely to and As ability completed reducing our calls, prior value resilience has fourth shareholders our and its positive our of furtherance one our several we've to by the demonstrated additional business acquisitive part discussed XXXX We're been of top in that recently due the drive to The was optimizing to to quarter. transactions of structure pleased in

this compared into The up to strength increased Our $XXX.X In the new especially were platform million, to expand gross sell Atlas efforts services, more to projects. and contributed infrastructure control of success. evident the geographies, quarter. transportation and XX% in revenues year work the all costs cross quarter, prior fourth self-performance our

private our work, the Northeast geographies for some business steady made have especially headwind sector disruptions COVID-XX since While California. from mid-XXXX. These the remain a progress and Northern in in trough

more to shift of in fourth the from services. approximately self-perform seeing high are decrease $XX.X from Utilization million, timing of million cross of $XXX.X of levels revenue medical last sell an A sequentially our EBITDA where the increasing was gross point have represented prior the of the and We revenue. also reflecting XX% revenues, to mix get adjusted number related costs. a ground. improvement and and attributable quarter quarter, were remained projects off year XX-basis fringe work net of we in XX% increased Net mainly strategy to new

the a borrowings outstanding with new deleveraging the preferred into We a redeemed a and transformation then million into borrowings our stable balance by feature. we to new XXXX. For average $XXX.X This net repay at million expansion also underscored $XX gross increased in our part performance term proceeds roughly million, XXXX. debt our a million we of strategic We basis units We revolver work of XXXX year immensely M&A years We revenue compared and asset-based up $XXX.X weighted up We from XXXX, to more $XX actions XXXX, year impressively, full selling the thereafter. Net and delivered with loan. a points. equity in $XX transactions. beneficial and to help $XX $XXX as loan. under drove the revenue acquisitions. gross self-performed More percent This annual our revenue our expanded prior estimated with debt simplified million rate lowered success loan, EBITDA compared points by million single our cross additional in a accomplish interest a value XX.X% as from we was the the revenue delayed to to balance dramatically net term $XXX by secured our a extended our of We decreased long-term will XXX to draw cost one expansion margin on cash structure our on and decline in our enhancements through we XX.X% million we tightly on sheet million a a par. $X by support year was entered to a million Slide all term aggregate our achieved adjusted of clients. sheet our average following: of February, managed variable capital XX. and through nearly to highly utilization XXXX. I'll prior both structure. on XXX discuss million several balance and basis of to completed outlays our our organic two M&A. services entered loan revenue objectives of In our on growth used million fully We that outstanding $XX.X an limited Full through recapitalization as maturities was year $XXX sheet levels These

Finally, XX growth, M&A shares access we believe net projected expand leverage we public given capital warrant million. elimination Furthermore, the by our win aligned the which equity The shares further preferred an we expanded Class higher to our $XXX to million. increased Since is as Class refinancing our A voluntary of and two B A base and now and public move execute helped capital returns deliver the our shares with cash business A a Class In now to our is cash have year cash exchange, a roughly Class for years. our Atlas even for year. over provided cost conversion Class debt deleveraging XX shareholders. of of organic coming shares, and doubled to nearly positioned protocols to in years. end, have expanded EBITDA November, anticipated on to to stronger shares growth A float. next our the completed to which disciplined of immediate flow $XX.X we continue flow to management generate deleveraging operating savings in cash our and of through better flow million our cash Slide A access liquidity are goal of over XXXX. combination I'll our We and higher allocation an XX. for reduce flow million cash to The to

XXXX. and EBITDA. approximately cash operating related expenses approximately COVID-XX, public generated our million This formation, $XX to represents Excluding adjusted XX% company one-time we acquisitions, of cash flow of in

view unchanged will million should commitment expect acquisitions, transaction which public times. directly are XXXX objective. acquisitions to balance includes more funded sheet, be M&A is leverage reserved the of deleveraging cash our for on contribute reinforced $XX stock. with that We and see is net normal and strategy laser executing This our generation. year specifically our a to aligned with loan cleaner to to strong three note performance we sheet, that cash down capital draw another to with committed term identifying our drive the cadence company in this cash With delay and begin the balance we focused rear of priorities I'll

to to create expect investments. financial through value also We preserve additional flexibility opportunistic

these our generate of strong returns our actions to for support shareholders. All goal

increased we on each and year of our adjusted Moving quarter grouped on four-week of month and months XXX I'll the first going both end. continue be divides one note comparison this improved quarters of a forward, This A to into to reporting not and for days four for we our month. into a better Slide year administrative calendar our provides and a calendar that full XXXX. appendix forward. XX-week number our have XXXX two moving to comparability comparison schedule, provided change outlook Prior in changed which XX. five-week XXXX in performance quarterly will comparability have change year will shown efficiency be

to We are in deliver excited XXXX. opportunity the growth and organic acquisitive about

us of While outlook ongoing backlog and year to level the our full we someone related our you positioning predictability and a to our exists business challenges with indicators certainty of provides XXXX. the share for with market of COVID-XX, believe with

range operational range $XX anticipated our We continue million be the million $XXX into the $XX local in conditions, adjusted which of end visibility efficiency, XX% to the XXXX results. year and account compared to EBITDA year $XXX our for strength economies This increase as takes XXXX current backlog cost are of and midpoint of outlook to improve. at We timing on million, the the initiating be to our in the of market management. to million, revenue full improving full reflecting vigilant to implies a work

the on XXXX. Joe turn improved in In to remarks operating back now generation flow I'll XX. expect addition, for you. call we And Thank cash Slide closing

Joe Boyer

Great. David. much, very Thank you

proud past exceptionally over year. are the of how Atlas We performed

business to the all Our COVID-XX significant the headwinds market model to pandemic. in leadership resilient demonstrates from environments. delivered be despite and solid this business of We our strength our the results, team feel adjust successful promptly

accomplishments am like I highly a continuing earnings. public year we company company. unrelenting on to give on are financial public in stock. and continuing position year national access look well deliver us. positive and execution We solid increased please. that and our am reiterate success XXXX. believe optimize performance, and for now our power right safety out business investment. and to infrastructure. positioned Atlas executed accretive and the in and Q&A, leadership this infrastructure the thank nation's our with And performance to again over as performance and our we for Our all our commitment well I the can also proven strengthen These the consistent us all firmly margin We our our our capital to infrastructure accomplishments beyond. capitalize for ability structure, confidence including M&A. capitalize on grow particularly are liquidity the strategic year the strong I past of diverse with forward XXXX we warrants throughout investment. the acquisitions. retiring further to We open to I of pleased as capital track as We up commitment the economic of would on recovery to built organization joining being to you momentum the in first to to multiple, preferred pleased team nation's needed Operator, for more want lines our

Operator

Our a Markets. Instructions] Capital Street conducting time, we first Rob comes of session. [Operator with At from line be Lake Brown will this question-and-answer the question

proceed question. You your with may

Rob Brown

Hi, good afternoon.

Joe Boyer

Rob. afternoon. Good Hey,

David Quinn

afternoon. Good

Rob Brown

job Nice on the quarter.

of you're kind where see view the into COVID out this would and market On year, and organic given at the given, where growth say the shaking organic next right at you kind environment, the now how does growth you point? look of

David Quinn

Thanks good of revenue From rate looking an $XXX a a Again, Great. put range at indicates out Rob. perspective, looking million, mid. we're We feel we which a really organic XXXX. into X% range overall Yes. growth the year-over-year forward X% by ESG infrastructure, specifically will seeing our at and evolution growth a new opportunities. driven know, as of the and in the business be to as expansion relative we're this side environmental to X% continued and well on transportation you

looking XXXX. as we're So, us into move that to fuel for we

Rob Brown

seeing? this to contracts you pretty sort Okay. you alluded have impact see headwinds of or still that lessening you at the into it, COVID some visibility there's do And do your that point? good you're of feel sort you how Do but

Joe Boyer

me Rob, let that. take

our still say that, really competent XXXX. for we're strategy let first in me So,

think of validated it XXXX. I in was sort

about guidance our strategy we out there. good feel put and our So, we

will as We're COVID our sectors growth continued in levels. in I in-market. well back of we to that pre-COVID though services, Regarding all we our seeing QX. quite still seeing COVID specifically, are are as impacts service say not

that to XX% I backlog but bit it's the fully mean, has in coming that important competence as steady into across that So, think stress and still been visibility already. QX that considerable we've funded. Rob, I identified little it's backlog to got in operations – inefficiencies growth operational pretty into that I backlog. XX% due and plan to look to that's QX, of the our our of requirements. in they're note a being of COVID-related have mentioned, our our an we and want there's But the

continue important in infrastructure think note So lettings And strong activities that – I any cancellations and in larger but in QX. it's XXXX our transportation to really be material also had to with backlog. we QX hadn't increased

progressing starts current are steadily So project pretty well. as

Rob Brown

over. it thank Okay, you. I'll turn

Operator

Davidson. Our D.A. of from the question with comes line Thielman Brent next

You question. may proceed with your

Brent Thielman

had you. on thank the Congrats all year. over the you in months and accomplishments last last the Hey, few

Joe Boyer

Thanks Brent. I appreciate that.

David Quinn

Thanks Brent.

Brent Thielman

follow to line. up environmental Hey Joe, I service the wanted on

I you're it's and David, particular mentioned think expand real I that from bit of commentary some you that little just sorts challenges regarding of you ESG caught out a the pie? that area, some had opportunities. there on things it the some in of of very you had XXXX. that area, piece Could for the significant because a seeing

Joe Boyer

a It revenue is been part Brent, backlog of strong has a and business. our environmental, our of third about always at

Let our really me We we we're markets where diligence headwinds industrial our to from just impacted services. speak to closely they're as due relating building of sciences. and was a little areas saw bit about of business really XXXX, in our and tied saw environmental finance being XXXX, business impacts our banking parts three commercial some so and

high-rise where in home. the of for That we the air Northeast, impacted work working a of was buildings. people indoor of clearly you lot areas So, a particularly lot do quality older from had

were maintain the less and So, high-rise retail building had petroleum buildings we our continuous in didn't level there, business. service the owners that also – then

that trough in businesses XXXX. impacted were really So those three the the are of the

So, pick pretty diligence up financial recovered. markets business we the saw the due when really heavily

building sciences already starts picked well. was back petroleum July is that impacts sort and their on retail environmental and back business is of and up well. that side We're the our of seeing into steam to full business So June, the some as as the still business project

the for our areas see consistent see ESG focus as services federal on growth and Biden with space. as and compliance well growth administration's we're environmental commercial in business We in in looking in business we in So, environmental. the continued growth of renewables, the

helps that Rob? hope I out, So,

Brent Thielman

Joe. helps, that Yes,

Joe Boyer

Brent. Sorry

Brent Thielman

Joe, wonder that be if are but well? helpful? as obviously and No environmental Maybe any things looked Washington. that infrastructure update we up, benefit lot [ph] it there's going a arena, around I at follow And what know eye an in being on, it's to a on bill, – maybe really keeping just you forward I the lot talk worries. could would business policies push other there of in

Joe Boyer

Yes.

Let me say think clearly on infrastructure Brent positioned is our entire bill to for I forward waiting firm that it. career well capitalize going my any and

going come, are our that of days We'll get the spend. States own I potential but One the in focused to their these really, it's to of finding projects. that creative this And coming business are is wind attribute ways being any fund we're well lot from growth in still infrastructure a positioned. sails and States from

infrastructure get that but huge The that. still environmental still win bill that business, I hopefully I think will think So, from think, we'll that. we're come, the I watching

environmental ESG regulations I in services. to push that continue willing growth administration I our think and is clearly to type democratic think

as still we growth business I well renewables services. mentioned, areas in like types in So, of see those that continued compliance,

Brent Thielman

David, adjusted level XXXX? to this think like a for the flow Is operating operating or that cash this one-time be might for the cash was Okay. you, a sustainable about adjusting for XX% year. way EBITDA one flow of

David Quinn

had going getting public. offering. experienced, during re-capitalization, it occurred the had we is transaction that had Yes, destacking we we obviously that new costs warrant Brent. the past acquisitions [ph] We the three Minus the year,

that an of carried lot amount type through expense. of had front-end of significant a structural transactions that we sort came awful So,

those So, when XX% to to in, definitely we those range a you reasonable better. normalized look is going forward, be a us adjust hopefully for yes, and touch

Brent Thielman

perspective all quick in I'd thinking think company activity whether the about kind be activity one, the to for perspective, perspective all here, are where deal Okay, XXXX? you of lever done or cross-selling get of can services here love you from your that just Joe, another terms and you've a great. at One the and shared just

Joe Boyer

business really runway DDTL. this for say industry I Well, do business added say is I before let of me highly heard entire M&A and think fragmented. have growth. there's mean, strategic – whole you've we recently Brent. with robust – think are, particularly extremely and lots a this And of a And I we we for me opportunities pipeline our in the think that

to are the strategy grow our organic growth. We of on to half business looking continue and this acquisitively half

So…

David Quinn

be of larger think opportunities, going to abundance selling cross strategy at I as as is in seeing which this an time. our prominent pursuing to we're continue well

Joe Boyer

Yes.

Rob, really your is in we we might mix services, I Brent, can where, right. for a to, for, specialty areas think, going get our TIC-related I'm and we're looking strategy that's of business provide to where a sorry, I'm better a our company look name

Sometime maybe But after get sorry the fourth analyst, but… I'm Brent, I'll it right.

Brent Thielman

worries. okay. No That's

Joe Boyer

net as Our revenues to services the growth more basically will tell, our than we've and us growing you businesses and our revenues, we're acquire we're strategy services. in allow we're provided to than that that and that our mix in the our faster And services a offer service looking geography of can self-performing ever past. full range of

our So cross services. that's by focus. that And done selling all is a continued

might that or have we better we up for services where service TIC to that a of an geographies look way. the the and company in integrate less environmental type So, PCQM focus

our forward. still that's So continued going strategy

Brent Thielman

you. it. Okay, Thank David, Joe, appreciate

David Quinn

Take Brent. Thanks care.

Joe Boyer

Brent. Thanks appreciate it. I

Operator

Our next Noelle question comes Stifel. of Dilts from the line with

You may proceed with question. your

Noelle Dilts

on Hi, refinancing. in year guys. Good congrats evening the and the again strong

Joe Boyer

Thanks, Noelle.

David Quinn

Thanks.

Noelle Dilts

mentioned Thanks. of all, strategic that Joe, the Are you partner? private from on or a seeing go to you really the on M&A, markets In of Atlas prices types to at companies finding up comments looking in and are to pipeline. pushing you really seeing equity, join really that have some are back your some are we a I we follow, targets. solid just interested more competition that just wanted robust

Joe Boyer

Thanks. great That's question. a

we structure, Let the me, I that our I feel prior that think do our think acquisition success. way Noelle, deal

made an focus have our led on us acquirer think heart strategy and I of choice. integration a leadership

Okay.

stay Most from we organization. pipeline mid-process we leads away our from lead from of technical is have opportunity. generally So, internally or that our built a broker deals our really

but we true, sectors definitely can increase see And of opportunity seen I we significant haven't So, people have and in we in the the I from seen, have other certainly, increase in and kind multiples. I not competition I'd the just say didn't And that, that any seen during That's XXXX. in equity. we're haven't that seen tell know you, we I XXXX. private in reported signed

a competition, six from definitely what looked four but reported I in it's business times typically. vary and little haven't more for the to seen [indiscernible] we've bit past at So, multiples

David Quinn

be this are organization standpoint And in our Noelle, I'll an positioning our company. we're the in is of business history part the of of retirements. just The cultural of we've up to choice. because over as think they're a a into and firms couple in these we've upside a is and doing about brought talked ourselves and a retention specifically of bring far, bringing this see what reason we've believe had they acquisitions, to talked I them. Atlas, strategy, we're and and organization come high I of of and us if XX from have great then chosen, a add leaders the principals principals fit the We longer-term that of We've XX for that a the standpoint, acquirer part about in businesses from thus here want you about, our in range. at retained the they XX% the And becoming look little

get They advantage see can that of do of outset. the the not and they're long-term the being at really part the simply just return bit firm of regard. a to going multiple in we So, we have believe an

Noelle Dilts

Right. Right.

That's Okay. great.

to of you of we've a today the to throughout moving has heard lot how those to seeing you what strength warehousing, been that centers, could echo reporting they're about companies have that generally, in there are markets forward? season, data Second, you markets, e-commerce the kind from touch and exposure this exposure on repeated, when that have thinking construction extent and

David Quinn

on as are specifically, diligence, service there nimble see particularly we're start going making talked areas call right we providers pivot supporting building the side the ask Joe logistics, in that starting I of that also to the type pick And largest and I'll the expanding. have while a world center the our it, strategically I'll outlined and we're past as in work and some we're some to see about then in the to work this to going we materialize. to turn commercial know starting to things, side, organization, we IH on Noelle we've opportunities of the out where data need we platform now, do of up. how Joe name warehousing focus due diversification We're good without going forward. side, in believe seeing going a and one to commerce we're be we retraction, to

them. our think, and win you've and position to is are those I perspective So, we're we're starting developing, consistent them seeing what heard, with opportunities

Noelle Dilts

Okay I’m great. two just you – then And Did sorry ever…

Joe Boyer

really right ahead. know I didn't

Noelle Dilts

Okay.

gave any these first make But all guidance. in don't the I saw know of the I in some quarter? housekeeping more of you and the in of quarter, quarterly two terms impacts we year event particularly overall the give just for how So the first the but appreciate, that on color about questions. weather weeks give can you of think the quarter. Texas them kind comments seasonality the and, to you just Joe,

Joe Boyer

experienced storms all, Well, of we here Noelle, were Sure and obviously, the thanks. unhelpful. unfriendly, first

David Quinn

unusual. And

Joe Boyer

unusual. And

relative uncertainty First, to some do we start believe yet the I again. let There's engine to And we really broader to and how economy, growth obviously, be the the with during that in breakout geographies are we're expect up. fast about the mean, back do But levels there, new starts it pre-COVID we QX, just vaccination quarter. opened rates, to strains, said, completely starting certain relates quarter second COVID this optimistic. business ahead cautious progress, see, will moving to rev back of still this out to QX being operating me looking to as those

seasonality slightly be spoke You seasonality, the expect profile, prior while that for you've in in we profile our QX, consistent as tempered in to seen to business the year.

little and and our steady a So, storm quarter. but we a will about expectations out solid a there parts through obviously, impact, business consensus the of we've we week bit overall, an the we our still impacts way that with first good that mitigate in finish with different of seen of had think about again, we feel

Noelle Dilts

remind question think was how any you CARES kind saw then just to the cashflow us if Okay, my can great. forward? question, And Act from about back of and that the going benefits you last moving to tax

Joe Boyer

There able other beyond some us. But than benefit it cash flow like was just significant defer to in were we wasn't substantial wasn't most that, there for anything there Noelle, – related to able we were that some businesses. employer taxes,

Noelle Dilts

That's it thanks. me. right for All Okay.

Joe Boyer

Noelle. Thanks

David Quinn

Noelle. Thanks

Operator

of Kathryn question comes the from with Research line Thompson Group. next Thompson Our

with proceed question. may You your

Kathryn Thompson

today. you questions thank taking for Hi, my

that building you appreciate little Following-up a But improving and momentum strength out an in the you or overall of Thank you. a of I terms call. flesh this are work, previous on from details that infrastructure, just more the gave environment? more could is bit color them seeing particulars you

David Quinn

Sure. to that our markets that QX all our and from XXXX. we would end all considerable of in Thanks, of progress Kathryn. say seen services, I QX have of

projects, it's space we now growth of And or consistent projects obviously, and of had aware, the cancellations in we've XXXX. a material in markets have QX in delayed not commercial particularly some and were QX into we are along. progressing that that So, tech more any pattern end XXXX, basically didn't seen, our

considerable you states that that as transportation to to the of so more I all PCQM, will general in still are our growth, slightly some growth as it's Even had areas work, the a are considerable in growing, growth across tech with of the in EMD, budgets board the transportation states continues still business XXXX. So, there be in flat focused space, that showing XXXX, tell strong. that on, we're well reporting

you, that hope I helps Kathryn. So,

Kathryn Thompson

Texas, Southwest. exclude And if then impacted Yes, excluding that does. I and it Snowmageddon the you guess,

by strength relative that but of of you Thank out if seen And And have on sector be relative break you would regions the helpful by you provided projects? improvement? you. could are detail, it you relative could side? the private that, some you private region what seeing Excluding you improvement projects improving, types give greatest and type talked sector about

Joe Boyer

Okay, so let me first go back to the first question was around…

David Quinn

Geography.

Joe Boyer

growth, right. and Geographies regional

regions. lot say four our strength we is say, has work what So, all a recovery I that we the that in due the that is of diligence across do been would

So is that's all regions. across hampered the showing revenues across that now really And XXXX in business was that rebounded.

sciences We on the had side growth around and have York New where sector of seen of commercial We've seen business, from public in building in we the XXXX. particularly both sector. well, in seen the recovery troughs that our upstate some the area, as

all transportation continue Our to businesses be throughout. strong

So our the region, West business. as that well Coast Southeast as basically applies our region, central to

as looks seen I us slowly private business, for three of of we retail kind work but to that has those in the progressed to saw that growth that do thin well. biggest So, I think, that In the work of that regions on but XXXX and all a sector any look challenged. transportation was We hit work recover, I'd little say the think… business retail

David Quinn

I new not states, going contract sort was saw Joe, seen, of up through shored a in businesses of this year. and serve the sort fueled – say of strong, service Texas we that standpoint, think was relative contracts extensions, we and particularly, year, in From as the really, inspection I wise, only to services executed we also some softness the of wise, mitigate we've York. California outperformed amount Northern booked, and very commercial and specialty, our we the central to region our progress really examples New that tech really expansion in as strength some work amount proximate work

that bounce year. those So petroleum, couple had petroleum, of second the back, are retail half through saw areas nice performance, a certainly we strong the a of

Joe Boyer

going was steady business as customers online, petroleum from back private our our to say, petroleum business, the serve trough I and a improvement well. it was retail our

well. we're seeing that business steadily So, improve as

David Quinn

of Okay, or realities services or us markets, end grow we question I'm of say not priorities with you understand and choosing focus touched an bit the that's a are perhaps world? focus there but overall little capital general growth, in the terms but of or because of going a this of have changed, given really the post-COVID to their to helpful. less. M&A structure. come on of, Again, dealing better on that out Really and M&A, And kind world, COVID, then informed, more bit final be as on a are help post-COVID little are that, you

David Quinn

Kathryn, maybe then start chime and Joe ask I'll to I'll in.

public and to warrants being we we're took pleased quite I be First mean, we're able our did sooner recapitalization. but eliminated here accomplish issue, is the nearly than this in would float first And overhang I thought an clear the obviously, expedite optimize shares. public followed we able to. about able frankly, tender, we we structure. to through not it allowed strategically X.X step to it step executed our also increase foremost, us our it, think, streamline big the to We big only with A extremely and to by Class we which November, million second

is million feature. preferred at improved secured exclusively loan a par, single course, loan, So, million of a an we asset-based to consolidated then into revolver everything committed a term $XX our And that we $XX equity redeemed term delay established we expansion with for our we M&A.

structure, So, going to, overall business on which and grow continuing organically is, to again, look time. strategy an to the I cash to accretive and to the same, relates the through capital reduce plays it strong leverage continue fundamental the think performance, that your from strategy and at as acquiring into generation. and that de priorities our question, strong that And we're flow right is this drive at, businesses over We're help time, M&A. leveraging same can we're our to margins, going operating going strategically focus

areas at Joe which Now, environmental, to we'd two know big I be transportation, about. talk will are and that certainly spending be looking going infrastructure

Joe Boyer

business, specific grew space In that as add to services, we services, and in just considerably well. PCQM clearly, regards growing looking work Utility that our so we're your environmental services, federal growth for continue in our type we business, what for growth business talking to work in We're grow see specialty me looking transportation that. about we're service let continued – to in looking at SUE, that Dave, inspection compliance area. our more in Engineering as well as and tech sector Site renewable also looking Yes

there. you three said all would services add but what I to those So of that – sort there, that’s are

Kathryn Thompson

guys. you, Thank helpful. Very perfect. Okay

David Quinn

Thanks, Kathryn. it. Appreciate

Operator

Boyer, and for question-and-answer would we remarks. to CEO Mr. like of reached back turn gentlemen, over I end session. have Ladies today's this the call Joe to closing

Joe Boyer

appreciate Thank you, that. I

Technical everyone look And you Consultants. do joining and the support forward we today. your Atlas appreciate of our updating in future. for us to time thank your on So, We you progress

you joining much us. very for thank So,

Operator

conference. today's concludes This

the disconnect may at your participation enjoy time. your for rest Thank You lines this and your evening. you of

Atlas Technical Consultants (ATCX) 9 Mar 212020 Q4 Earnings call transcript