FSTR - Earnings call transcript Q1 2021

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Operator

Good day and thank you for standing by, and welcome to the Q1 2021 L.B. Foster Earnings Call. At this time, all participants are in a listen-only mode. [Operator Instructions] I would now like to turn the call over to your host Stephanie Listwak.

You may begin.

Stephanie Listwak

operator. you, Thank and everyone the L.B. Good welcome morning to first XXXX call. quarter earnings Foster’s company’s Stephanie Manager. is name Investor Listwak, My the Relations

Our President the first then our company's Bob will Jim and quarter be morning. John Financial market some Officer, Bill Kasel, CEO, and Controller will company’s Also Bob Bauer; Thalman outlook, Operating the Bob be Principal Corporate and and review first quarter Afterward, perspective Accounting joining Officer results. will our update performance, and us presenting his call and matters business developments Chief development. on Kempton, first and significant our business company's opening financial quarter on making results, Bill provide we'll comments, will operating on this market our you are the Chief and Officer;

accessed will earnings morning on We with website and along for open will were up presentation. a comments page posted slides the change disclosures follow be past session earnings our then slide evening, practice, our this in from questions. presentation Today's our at lbfoster.com. the on release yesterday Investor In financial the Relations and our can

are and current of including as required of represent markets the are statements view as looking of today, making COVID-XX. revisions comments and except our our business These to to opinions any only the Some date in-light securities our of or related new forward we reflect this forward-looking statements presentation and information, we results revise publicly these undertake no laws. obligation release to of statements by

see the release our and assumptions relating For our and more statements, earnings to uncertainties, in detailed please forward-looking disclosures presentation. risks,

within to release financial disclosures metrics We provided reconciliation company as these presentation our will read carefully and earnings within metrics. consider and today's you also and encourage tables non-GAAP you earnings our discuss

understand cash yield leverage EBITDA, net presentation you and during of adjusted today. free will referring we be net helping the of flow adjusted ratio, EPS, debt, to performance the net adjusted underlying company, purpose income, the For diluted the

we first the income reflected to any not presentation the referred EBITDA, presentation. during EPS tables in the of earnings did as quarter [historic been the reconciliation have to the periods] net in While included adjusted, have in appendix adjustments XXXX, today or diluted to

Additionally, XXXX, of sale Division. Inspection our the in Test we announced September of equity Services IOS and

As we a financial this focused be result in and on to the our The a results divestiture, quarter have operation. operation prior periods Inspection presented change. have business and continuing of statements, Test earnings the will the including discontinued reflect Services within this and who today presentation first recast comments release as

let remarks. me to So, with for opening Bob that, turn over the call some

Bob Bauer

walk Thank take a some you, minutes to to Stephanie. turning to cover going to it their before financial through few over summary. I'm highlights Bill

quarterly X the If results. along on I'll presentation, with you're following Page be with starting our

The our first most with generally the the of revenue hear with you'll are $XXX greatest expectations quarter about in on results. had our was There impact QX messages million. line three that

later. of and the with second sales rise quarter the sales very speak is in also in expected QX builder in experienced I'll a seasonality strong February, the to January volume XX% finished came and with rise anticipated considerable which the First, March. a in low quarter, March, in for in sales then which confidence typical

the the to related sales, was these the up our last of measurement We get gross is strength of and Europe, were increased divisions prior the which coatings the of struggles prior decline, similar we've speaks performed X.X% rose to the only consolidated other the reasonably the for service rest we margins, company lot this some the that the A continuing that led year-over-year below kept Kingdom. Second, a had increase third majority and that basis over backlog in rest of related profit ongoing year-over-year more some are in weather year-over-year in year. X% margins in applies to well, about United sequentially XX in orders across with The quarters, $XX driven drove quarter. most is same led sales coatings disruption sales. the non-energy last weakness which deliveries the These from this by that and fact a earnings. related environment what X.X% of businesses. is backlog, pandemic and increased and business sequentially pandemic our decline believe XX over interrupted in on that's million our converting to sales which the margins notably from prior the declined in America as and straight resiliency to points businesses. by while better, XX% And year, of pressure Sales were and over decline by the to million consolidated gross primarily weakness story increasing market few gross orders, the drove businesses from North in in last and measurement year, third, all quarter in which had our year-over-year consolidated our especially And year, what year. in

to will backlog So, outlook solid have equally throughout we the a call. an describe XXX second start good and the million quarter,

managed sheet our in about flow and to had balance strong, performance, also to really sheet declined capital comment the remarks. good a look our in from liquidity will the inventory continues year. his Debt kept from generate the for flat on of flow, we Bill balance start and working levels cash also and and we quarter, cash We cash quarter just more

will looking So, optimistic more conditions. and the based changing with on which market forward a a outlook start second quarter, strong to we're backlog

the passenger in U.S. also experienced on comment the intermodal markets that of encouraging traffic commodities increasing me in are first Let the both there rail, market in conditions. and quarter. sectors, and these excluding many delays in freight world is In strengthening signs traffic weather-related some were of

sensitive increased that indicator a good a experiencing sales customers which consumables and or product management are volume friction increases. Our in anticipating traffic is QX,

In construction general rail as card support projects, we money of include by pandemic-related significant on the America's funded in much lot well bills in The general for of Foster And that need there's the addition, infrastructure in Association on infrastructure infrastructure expect projects. as to less disruption U.S. a the recently projects engineers spend infrastructure civil areas projects. recent report benefit. highlighted where can L.B. from

expected pretty current for than our overall, given capital served pipeline capacity midstream markets projects the other So, is the defer which foreseeable look the market, future, energy to outlook. good,

the last few see levels volume as low the quarters. area energy However, the some in I the for may expect begin pipeline improvement to unfolds, we given year very

volume this describe So, the which backlog, combine a with strong quarter expect significant led on outlook where has when our expand I'll it more increase quarter, we bill in us a second after makes remarks. first over to his we

point, call So over to Bill. we'll turn the at this

Bill Thalman

cover morning opening comments will in key quarter the everyone. good Page and results Bob My the Thanks, on our reflected of financial presentation. X

first quarter softest the seasonality divisions. mentioned, to of been historically due effects our several Bob quarter our in has As

quarter. However, encouraged we are that the the improvements by developed some of in

gross was profit the First color million some basis and margin in year, gross first XXX.X decreased in million Consolidated on segment XX.X% gross prior the quarter a from quarter year or $X.X minute. decrease down the million million, were additional year-over-year. sales points XXX profit profit and sales compared X.X%. a I'll quarter $X.X last to XXX.X provide

expenses improvement in of quarter administrative costs, the decrease expenses. XX.X%. by $XX and administrative X.X million travel Selling $X.X and prior percentage net or versus points decreased Our selling was of XX.X%, related reduction first driven an million million, in of expenses including as the sales year basis The were to quarter. a primarily decrease a XXX personnel a

segment, by diluted loss operations negligible net gross in million net last compared administrative to on $X.XX a with decrease cash number also prior quarter. year, cover EBITDA new strong million loss million, quarter provide was XXX.X Operating per million operations offset a performance and a continuing earnings was the in Order segment diluted quarter, orders on backlog orders, the year, but million, cash First was or few quarter $X.XX representing expenses. $XXX,XXX XXX.X at share backlog from $X.XX continuing flow reflected lower quarter, profit first million $X.X comparable net in last a loss year flow, X.X result in year-over-year. revenue decline I'll per continuing $XX.X minutes, infrastructure by from million partially details a and Adjusted resulting from $X.X increased in a X. a of for Adjusted very no X.X the of also and a diluted selling profit in per to share. or quarter-end. share, This diluted drive gross the share. per Slide versus at was of million last $X.X first additional year's totaled lower operations producing reduction solutions the versus increase in X.X during driven activity the quarter year-over-year first I'll helping million

improved timing profit in poor in segment in margin profit While with attributable revenue year-over-year, and point XXX deliveries was that rail was which the a by management friction consumable due the resulting revenue $X delays, a Despite certain decline in to of by didn't gross technologies to increases profit in down entirely customer due weather. the gross the year-over-year, solutions segment. to the revenue impacted unit, within increased Rail business. year-over-year, ship basis segment segments rail infrastructure $XXX,XXX, driven decline both profit by gross improvement million rail down was orders including primarily was The was products gross sales margin. decline

line Bob solutions varied on infrastructure business significantly. underlying earlier, As performance touched within the

this from improved It increase Boise was the operational as highlighted. concrete down energy infrastructure which results coatings steel midstream projects. provides the to due fully should substantial the So, these the measurement revenue first year its of decline more that Infrastructure that of unit facility a general relocation X.X in in I'll unit, quarter was profit continues to precast lines. infrastructure a to in challenging was business the Recall with activity Slide Spokane. has million facility greater and XXXX. last Partially be units the each offsetting with have environment impact fabricated mode wholly increased decline Solutions these both startup and in in bit year-over-year of Revenues in unpack business the excess attributable revenue sales gross breakdown X business market capacity. in after in was and with detail. face a a a demand noted

declined and increased the While measurement of lower million, more business profit in revenues on profit driven year-over-year coupled concrete than stabilization the gross facility, gross Infrastructure with by with X.X primarily coatings precast Boise doubled overall Solutions volume decline line. the our

solutions margin was due steel the QX XX. fabricated gross to orders were and the solutions sequential the million was In infrastructure order increase basis. profit now over on mix also in business robust impacted with XXX in with year-over-year, Infrastructure both orders XXX.X products number Order profit new points driven was by down growth revenue QX temporary sales our million, the increased The addition, of in line, headwinds. Slide infrastructure segment. up segment on despite demand unfavorable down QX XXXX. a compared last precast activity cover sequentially, year, increasing basis million favorably gross in cost I'll XXX.X by year-over-year. concrete to and X.X Consolidated orders solutions activity was year-over-year

continue for Solutions at of driven trend by X.XX. ratio X.XX trailing ratios Infrastructure a XX-month favorably primarily to book-to-bill consolidated with period, Our the

in a driver number of use working cash. improvement cash this and X.X XX, capital generation X.X million to year's a as of strong an opening improvement decrease Turning we first year-over-year was in had of on investment primary cash quarter of in The million flow last versus operating quarter. Slide my slide, flow the year's operating XX.X the noted million with

in revenue project XX.X of Our of collected receivable million million advanced million, primarily accounts payments primarily in trade XX.X receipt partially doubled The in increase several X.X segments. by which than accounts million. both X.X the increases in year's revenues, capital quarter, offset driven deferred the significant significant deferred was more this payable quarter first of working decreased to of due by increased in and

per X.X in from flow operations totaled cash XX-month trailing Our the in period. cash strong XX.X of million, performance operating the quarter cash period operating implied cash flow free resulted resulting spending and for quarter-end, trailing Based the of at yield XX.X from XX.X% $XX.XX flow stock up our substantially both million. period, of XX-month price our closing free was XXXX XXXX. flow Capital in during million continuing for this on share

were capital the X.X precast During Texas. first primarily quarter, the expansion business our in related million, the with expenditures of to line spending in concrete our

flow retiring SAP range with to $X business of systems. ongoing million to two progress two as spending million available We cash last our available during capital XX.X our our implementation funding times. light manage the over proactively expenditures XX, toward total ability facility, the XXXX Referring in believe the was at our under We challenging liquidity our business be for revolving in in also our our of to credit capacity number model. $X quarter-end. cash capacity free we had will generation years estimate continue as our modest our defined highlights capital on million legacy We plus ERP to total line Page

million for on trailing Our leverage of ratio in last debt versus million March $XX net the end QX was net year, XXXX, of period. XX.X resulting X.X an XX, down XX-month adjusted the

see the reflects we've down during Over by in last was during debt quarter, our capital flexibility needs. typically quarter and to continuing very debt, net We’re increase Page working years. strengthened ratio we time, levels including with XX of four this to our height due achieved balance adjusted overall the net This systematically by our over reducing the our sheet last when [delever] pandemic debt million. $X.X year. financial a the leverage pleased paying

with conditions. assess market generate Our year. recovery to our anticipating free received will restrictions positions already this flow tax demonstrated debt that approximately us continue typically throughout improving debt our no increase in capital selected said based million cash that, strong M&A My related generate that free on it's conditions however, this improving for year, in and to second during continue of or quarter. assumption financial working the this QX. of this We're us on refunds backlog end to final take million the reduction bolt-on This advantage see acquisitions to flow XX, well We're or significant and condition anticipating on refunds at investment we XXXX, we XXXX. With pandemic XX.X we reasonable also opportunities. the backlog at as the complete XX. comments allow Having end our the do the exiting reflected cash we'll anticipate We'll with income with precast our XXXX. XXX,XXX a to expect XXX.X and XX.X%, significant increase of a stood further of transactions from These first drive still and markets, market year. million, improved quarter, ability coupled unlikely we to outlook March are to an new December down $X Page to Consolidated business $XX.X increase coupled of quarter any commercial Technology’s year. compared first million X.X% the an sequential represents XX, Rail opportunities concrete should

some for an Bob for in move our saw the in to turn pace back we we anticipate to additional you we're March, With in projects the believe see activity beginning it Thank backlog forward and now perspective conversion second quarter. outlook. of And improvement your I'll increase in on attention. the

Bob Bauer

thanks, Bill. Alright,

for residential coming what our in build for exhibit a of way across And about how is position. best XX% said increase package, XX the a steel outside increase both and and to and transportation mobility. concrete last XX% quarter from backlog improved XX% for XX% segments, year, decking, over markets. approximately solid strengths each supply including projects, This and infrastructure both increase see driven the to orders one projects, of reconstruction, is that Bill to which highlights fabricated up to start On on a related you'll rail increasing efficiency, the deliver rise which divisions, heavy the rail and precast backlog really I'm million. reporting double-digits construction, spread is The outlook $XX on beyond. just chain by going So, energy solutions, projects bridge from coming increased our Page of related strength the is civil the focus our

ton mass need need pandemic benefit freight and an rail per trends modernization. systems, believe recognized brings sales the we cleaner environmentally move of of need as forward, freight alternative from which that systems, less compared that modernize the with benefit in supply are consumption congested that including outlook cities. transport, to moved way impact and through for people positive from lower well-positioned forms a the emissions to rail from emissions transit to investment trends the repair of fuel U.S., much an intermodal pre-pandemic rail haven't for from key need In In in begin are that's to more supporting place, they to online infrastructure transit supports on to efficient levels the the the quarter. heavy UK, about the as rebounded post restrictions that industry and ridership they're Among expected the further rising. and addresses changing levels, as in the or are second XX% of Looking remain chains, company systems but the for are economy, back rail reduced is

the and focus in an increase UK, traffic to on in railroads a us. delivery. U.S. and bodes all to since X% efficiency this improve and freight Class In was important on well least which sectors growth support in technology transit Rescue and rail CARES among the recently including transit some passed certain More legislation the of European addition, funding Act, than being receiving passed backstop Act rail. billion to recently, Appropriations improving in provide intermodal one by transit American their U.S. at us. are rail for taken have funding the in is they last $XX from especially was XXXX the been the agencies, Act, to year, actions Similar And by for the CapEx form time countries reporting are Consolidated forecasting with

U.S. need from. It on of several a worth the you the benefit recommendations the from report to of look number categories a increased spending for taking infrastructure American had haven't infrastructure, could Civil it's seen on that needed Society card improve Engineers If we at.

of on gives increase fabricated ports, where bridges to our For report categories steel is or wastewater, the beyond C- card and the good It America's infrastructure needed billion rails, covering as to businesses. roads bridges. goes this a report these sold. such at report There's our levees, freight a bridges. is parks And that catch waterways, of infrastructurereportcard.org. transit mainly backlog to in spending XX% and more, and $XXX nation's found deficient for XX example, and the many Grade structurally can obsolete annual applications stormwater, the suggested well that areas are up solutions public in The be

So, support deferred not to Keep the around some see in infrastructure $XX transportation these the that XX looking parks at address some to to American of to These build Jobs COVID additional in will in Page already on programs it's we design of XX Outdoors charts, Together, be Department time precast provided much concrete of needs. billion Act There's passed other for this programs. the to U.S. for get the American The transportation And the in needed phase. dedicated new providing through, X.X parks national our Act later gone headed support that bills was key expect maintenance other funds. U.S. transit as take momentum has rail in are the including projects. passed transit an U.S. destinations legislation through provided should annually of for the spending in would infrastructure rail passed many last further XXXX likely Great around buildings. and that billion neighborhood of much two outlined the billion, Amtrak impact mind bills year, agencies. relief our general we're Transportation non-rail for

may We're quarter. size immediate However, it pre-pandemic where current be for be to for not on orders soon, to directed some that expect our should a I in this tailwind from mentioned impact and the portion coatings although rate over a a growth the specific a as the adequately We're if fourth levels group I as not divisions from rise funded. return to low business needs, the million. yet, not spending group position is business the projects quarter, provide depending our proposal would $X in boost to a and well but fell targeted Last forecasting measurement the did orders point approved. that it's anytime towards

per better, they we could but the $XX we $XX pipeline on. were quarter obviously that proceeding the be and are from This being further pipeline of a demand once sign trough, little This pace still from for clearly operators. sector improves That's as order it's current million XX were oil, quarter, and way travel may the a energy have improve million. a seeing projects we an new long reached to planned should caution. midstream by But again with atmosphere resumes, levels. There's million

convert So, a second unfolding. bit XX, with the how major Page schedules do of about going COVID-related let our gives our outlook Customer and for the outlook in generate of combined backlog second vaccinations to rate see quarter this me confidence restrictions finish of specifically, quarter coupled to little easing all sales. that are more talk of market activity we how expected us up to the we served positive and on more with markets and a

less a sales pressure led improved strong account in us projects. continued more. improve to much XX% margins, QX We’re expecting and and on measurement If into improving COVID of projects. less backlog expect leverage volume sequential takes on first quarter the and or market with construction of pipeline outlook increase disruption environment is deferral gross weak, quarter. over profit profit sequentially coatings some to the of the energy to from has still from second forecast although expected solid The divisions combination keep onsite this added disruption we remain in This an services work an a for

expenses We results. now into a and on year focus sharp a carried have that for had QX

impact as resumes this facing on return increase some but rise customer see operating to and margins. on likely normalcy, spending will expenses other travel We an expected have unfavorable in isn't a to

off a year We're still significant a Working refund, performance spending expecting good Bill is continues to capital tax mentioned. outlook looks for to And our this capital cash as the year. look to favorable last good. start. Finally, flow

call to first joining you So, And question happy any operator and very comes line the much with Alex Rygiel going Riley. is back comments. to take Our on us return We wrap I'm my be have. with up to [Operator call today. we'll the from that, going to might B. appreciate we're Alex, everybody questions the Instructions] open. your

can question. ask You your

your could If please the is muted, unmute line? line you

Alex Rygiel

about Sorry that. morning, guys. Good

Bob Bauer

morning Hey, good Alex.

Alex Rygiel

Couple quick questions.

revenues can quarters? the variables will the SG&A few impact over rebound, that next As you discuss

Bob Bauer

Yeah. I the you it little move is, our say would revenue, to I have the volume, over it control that over too we people some you the years, connected will return reasonable a to SG&A bit than will We that. you a have of last just for first fairly business, travel And likely over much mean, start be have think bit I we some us thing move know that as our a I activity year, well. with sales to, know, know, of pretty normalcy resumes. as move don't business we'll bit but more point can followed our a they sales is when you've as what rises. to more increase mentioned to leverage as as business little about

out there and customers. some expect in to it's more So, but of with marketplace, as interface to you get conditions improve loosen start in area, the what to expense have up we largely we in the know, the effort

Alex Rygiel

the And end then, backlog at the of secondly, quarter. solid very

Does and there into into improved second the carry developing see understand totally out that revenue the third visibility activity also quarter in marketplace? confidence over I appreciate and you confidence the quarter, that order in in second So, improve the in quarter.

Bob Bauer

this now for a say been strong same quarters, would know, thing. you Yeah, generally, I has Being, few the right. backlog

So, that and see increase, a and staying of environment, that of third on sequential in driven, know, fabricated companies pretty energy, like when funded, know, good Infrastructure terms business that's looks of received. they've a ex- up. Solutions, same cases been in support of a driven, lot in so that spending couple have everything the rail what's U.S. the markets. to the rail orders we They've those some level. you straight the part has we Transit precast see by categories. years XX% But continue drawing our quarter look really at with you business, you you orders it's take for a some stay at of that up, projects the that, And in board. know, largely thing on That's freight going of strong European driven you but key backlog some mean, concrete that been steel I that's behind backlog a know,

pretty So, good everything those. looks looked for

the the going whether you would a think third now to in then normally sure year, I typical to quarter. with a see generally to gauge the there's the unfold So, half be good know, anticipate, to a in get going this look little seasonality you but end know, we'll market fourth not that outlook typical unfold, the to know, pretty you always, order unusual, from is. That it’s to we still an as might right you the I of this orders hard see at manner. order And we anxious second know, toward talked when of I'm be year and in not or wouldn't quarter is in-line be, second strong kind activity, about. And as we standpoint. economy how how We're

Alex Rygiel

you. Thank helpful. Very

Bob Bauer

Yeah.

Operator

next comes Ascend Our from Advisors. question Bair Wealth with John

John Bair

morning. good Hello,

Bob Bauer

Hello, John.

John Bair

you Hi, all are doing? how

Bob Bauer

Thanks. good. Doing

John Bair

what refund you I there situation of them what a XXX,XXX to how that said was the any, is be, going you sum? is about one what of that just addressed triggers Good. in does kind other lump work? it tax or the big back? [indiscernible] think of get might coming In – sequence questions, A quarter, got of you words, which number type And somewhat, refund, a is you my the first

Bill Thalman

Maybe Bill. that. I'll take is this John, Yeah.

the We're and remaining amended other half So, as amount back comments, in be about We carrying be returns, will on through the have filings to lot some either with a processing end result the in year. And filing. anticipating a early in frankly, and and a at they expected the million capacity combination a we make paper fiscal that I [indiscernible] then QX. that about expecting has we're of to have it, or QX, being end dollars it it the procedures, in my that to indicated $X towards adjustments, of IRS there's tax recovery. million QX, a the of is actually of got in balance has QX. to other to of It's the recovered get do QX, in paper, the half would then be a

and to filing have refunds through we they're expect know, they get the processed. once So, then, to you get that

So, the still back year at within of end fiscal that early expecting the of we're QX, balance all you know, QX, residual certainly towards but and half QX end then of the XXXX. remaining about

John Bair

net Okay. X reading And get roughly? is was – to Q million from was I in is you cap to that part previous this of the loss with about the operating quarter, something the there in lifted, combination that

Bill Thalman

taxes losses NOLs forward, additional have that in back by to cash has that And operating divestiture available IOS you and which go also payments temper to recoup recover we us Yeah. obviously, ability that go help the us, the allow going past and do our basis. a to tax. know, will This to with then, to still on forward carrying were back made

of reduction NOLs immediately, available. well because some can we there's are as future as that tax cash burden the of that that's So, real get

John Bair

Okay. good. Very

beyond cap, that. million two right? X that's there, not kind not and your separate mean, It’s situations right? I of is, So, above

Bill Thalman

that the controller greater And of The Act to X this million go allows a the our Jim us a point. recovering. is amount that secure and is here, one good back refund year. No. raises things we're CARES Kempton

John Bair

I filing, Okay. reading was what And be filing. that must the in past

Okay. be to And your working funds think capital further those would Do that? then plan used a or debt of reduce and or what's combination debt? on you game

Bill Thalman

Yeah.

the in capital And given quarter, of be we're my timing did in get down the remarks portion second being increase outlook second in say will and refund point anticipate you needs I that So, beyond seeing prepared quarter. commercial going know, that to debt. the quarter. working of we from expect to for the that improvement that a second pay we quarter a the a to view, that used this

cash free with year, So, QX to quarter, the to ultimately, a for normal our we investment cash full year through those to combination capital $X the fiscal flow of with in be in use be net will generation, able fully the via debt we expect pay able we there'll but the fiscal that coupled generate be should cash anticipate within factors. down refund million a that within working of

John Bair

right. All

number Very a to into ask I've what back and then is Can more, Okay. you in. I'll else other in I'll got of good. questions. queue, one somebody speak jump case know side a raw and for demand is the to material general, seeing I you cost of things, lot certainly of commodities in in you're cement could up, speak going price that? coming so

Bob Bauer

I'll that John. take Yeah.

certainly prices marketplace are in particular in rising there know, the You some our category.

market. in the prices You are we that rising know, see there out steel

for and cost have, distribution the time, that gross that our us input steel in businesses, the key You but businesses. margins both all prices for manage movements know, spread our in we the on is in area. maintain our an certain manufactured that's We and also to distribution always products

the do, we they're downward. whether the prices what in are that's market so moving whether or moving up And

going our about of in marketplace. – are any in we prices. steel suppliers, there's to with pricing fabricated businesses, from other in businesses, index So, that significant to time-to-time you input those up we impact we our they because certain distribution of our not some talk put rising then wind the where projects really be in bid our And steel know, costs, fabricated opinion, on material managing

our When line orders, moment, us by monitoring summary condition in across are large, you you concrete, to are lead margin out not that indexes things those for but significant might there's in significant most not know, electronics from as inflation into of allow something of going a of area you that standpoint. an that rest on is or other So, look at the know, the friction from to not the at technologies significant to of precast right compression product We're such moment the the us, is components certain parts some are much we're will that creating an that the rail there point in is not that inflation. at that times and product And those a be even very I our the our too you There for forward. that carefully. go sourcing materials that, That's now. things. going going seeing one products. is pricing area we're And take is purchase something this products know, management other in in have we materials, that, are of and exception of some out, say us our but we I change it time-to-time watching something would the rail that that mean, isn't line, that we that that inflationary other the there few we’d concerns but significant to some areas from manage. world

John Bair

in. I'll Okay, queue I'll and get all That's great. then. Otherwise, that's the back up you in great. get offline catch back maybe

Thanks. Okay.

Operator

I'm [Operator this closing Bob like any to at the further time. not any Instructions] questions for over back call And I remarks. to showing turn

Bob Bauer

be not, I follow John worries. But conversation. in there. any maybe reach if you us. might No in a jump questions you John, to have, thought We'll to always back out to happy you can take up Well, know,

everyone for thanks So, for…

Operator

[Indiscernible]

John Bair

to there. kick just I in going was thought else somebody Yeah. Thank maybe you.

and going up storms those strong – differed had and – So, real the, sense wondering freeze one you helped in or the know, forth, was, or repair that's of systems in. your new you a seeing the are question press the whatever, so you orders at time, it coming rail impact that much that being perhaps was any pretty have of on, if type have much was on questions you improvement was March the actually been in I had may with how on and kicked upgrades weather or in you stuff I ended not of the know, benefit of, out? release indicated whether related and impact in I believe that might an another that

Bob Bauer

Yeah, in so parts. those two take I'll

not said about we the sales, in orders. what was actually release So, press

somewhere by ramp there and in in begin came normally been corner million seasonality quarter the XXX sales look higher sales, quarter. had Our our would that of had the to to QX up of our the ice XX% in weather – not second of first Texas, in some were we of both operations weather. for it the delivery the have we kind and in opinion impacted had impacted we know, deliveries But was by around in We turn was, a new our and precast significantly with the the those significant comment That the you few timeframe that in sales Houston the March us some the of that operations products, there. was our in some have of on rail and concrete do area, during Dallas affected products. storm

in days So, we the backlog out move lost I those helped a more think, us, have of a and number of QX. that bit in production operations, would little

significant With can you on upgrades, point your regard to is, we know, that second of moving question to that some the So, probably second don't into I think anything there. of the part quarter.

But out work for things. model. business we working do areas not in doesn't project sure look really standpoint. weather, us, there, sorts We take resolve extra equipment they weather to us, do have the management things from of you bad know, don't that’s weather at And when the we care really services on-site you – impact those You know a of much services. get need that construction, to then and the it in rails on typically and a contracts of of service it in is kind know to comes to how friction for make our service really orders

weather tends stop moving give from know, kind forward, to things as you added of opposed us activity. to You service those any, know,

there's of in speak upgrades. So, to of really there nothing the way

John Bair

your you very in sales that to breakout forward water midstream good. areas, do area, you say pipeline coding a goes oil regards With Okay, and what for infrastructure? a you gas roughly versus would of other going measurement the see the to of there experiencing, way example, the and and percentage And latter, the others more as to the you in opportunity the obviously some that throughout have repair perhaps those know, and given pipelines the, States, the and markets well. United difficulties have upgrades be to expanding certainly but administration where got been objection energy

might that much you how know don't affect I positively. So,

Bob Bauer

Yeah.

into you know, that in measurement midstream the Far where industry, through under coatings look being away, the going and So, of when see you'll you and applications. you sales. we Q’s pipeline what the and as at look measurement, our report and coatings majority report energy majority we and is K’s, there, large

you more other than going know, far and on you're of building more the ground, typically but So, but XX%. we're coatings business are and energy sales be going the say [now] at, you XX% And we're into to are look the pipes majority, I to say, when group I business coatings oil know, when in ballpark going measurement or related know say into either you segment. away, I'm I work typically that, mean going putting and are gas away than majority energy systems. going to infrastructure. well, is and as the that corrosive And and the or there measurement, some far

John Bair

you you or is at Well, mean… even do ways looking operation applicable? other see or you water that know, into like, related that markets? expand to opportunity are I.e. I

Bob Bauer

No, it is.

we're would looking business, at our stages, systems. it's know as coatings protective you are measurement know, in particularly for but tell We as of you a suitable those, our that, I those small well you that early portion

other There you that, think, are are we applications of gas. still agricultural the related, energy, into well. And what markets, that's you of both but the know, served you know, the of that in haven't some gas. are past. they in applications in also some early know, petrochemical we applications know, those and [like in you go of those trying the traditionally and beyond even position a we have oil form market in energy liquids those served to know, market, you a as in significant sales that But innings of the know, or I lines product real portion more we're have You actually water] establish

We're more capacity getting we seeing the you know, NGLs the now to know, we increased actually the these there's think think for some we're exporting You gas out be you petrochemical to to and activity those continued NGLs of ground right activity, with natural and regard to and need liquids. facilities, and support know, from going NGLs investment days.

what of the know, applications export are So, opportunity now. I you to say have right those that of continue more an expand would you there one we into, water these kind markets, another but we it's more early market, of but gas, to the still know, is push be an will

that's and you that not impact, meaning an have – meaningful know, going in XXXX. a know, have to You

John Bair

great for or And I'm certainly longer-term the type whether stuff Right. there. water thinking whatever. infrastructure has need pipe a removing upgrades, lead it's

very good. offline. to anyways, questions there and very reach out you it time. I much my for So, and Thank cut will taking off you your

Bill Thalman

Thank you, John.

Bob Bauer

you. Thank

Operator

questions. And turn further any over to I'm I'll not Bob. back showing it

Bob Bauer

time in. we joining for call to Thanks your today. us next up the handling quarter. you Appreciate look you. thank appreciate you Kevin, forward everyone Alright, to for with and We catching

Operator

Ladies and today's presentation. this concludes gentlemen,

have disconnect day. now and wonderful may a You

L.B. Foster (FSTR) 9 May 212021 Q1 Earnings call transcript