MTRX - Earnings call transcript Q4 2021

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Operator

Thank you for standing by and welcome to the Matrix Service Company Conference Call to discuss results for the Fourth Quarter Fiscal Year 2021. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions] As a reminder, today's program may be recorded. I would now like to introduce your host for today's program, Kellie Smythe, Senior Director of Investor Relations. ahead. go Please

Kellie Smythe

Cavanah, welcome to XXXX and section on include matrixservicecompany.com. Service fourth be we Events and Company's Hewitt, Officer. under Chief Good presentation found the The call. to Investor webcast Participants the of fiscal materials Kevin Officer; Executive earnings and be will Presentations President on quarter Relations and President Financial referring morning will Chief Matrix Vice during today's and John can call today

report me and the forward-looking ended the company for on SEC. you and To non-GAAP our extent may our about filings XX-K company the result that that of let year Matrix statements call, XXXX. the in Private please company may of discussed Reform CEO Litigation remarks measures, subsequent various by Actual in utilizes fiscal Form factors, statements be purposes Company. with SEC call I annual today's XXXX Company begin, to including differ the Act various the XX, future we those reconciliations Before for remind results constitute forward-looking from June Service those prospects on the of filings President these now make provided the Service as the company's plans materially expectations, will releases, website. press and will Hewitt, John over of turn various in Matrix a Securities and by on indicated for periodic made

John Hewitt

safety total in company's employees achieve resolve serves which world-class best everyone our call a recordable achievement in a the congratulating X.XX adding and performance safety -- us. represents like zero to planning our incident year strengthen I'd employee additional were throughout good This achieving protocols by rate our XXXX Thank in place, safety to when to is joining safety fiscal and of rigorous you, test our a only to thanking complexities distractions. Kellie performance performance and the was the safety and thank incident the The morning, for history. you in and and COVID begin made for performance maintain operations.

among Before the response for they teams along from of under Louisiana first restore These to work describe topic ESG our integrity also accountability with home announce power culture, also away next are our in and for with report circumstances restore like teams to of which, and the we things, uphold Reaffirm improvement. impacted. drive highest sustainability publish following the like our those commitment life to other our safety, Hurricane that we storm to work of Directors tremendous it's standards others thank weeks quality respect. oversight doing, to often leave I'd to Matrix continuous enterprise-wide I'd Board ethics, of and by week, will and framework extremely difficult in power spend Ida. governance

effort and This environment development our good commitment undertaken on and state diversity a recruiting on and our to turn will and of Our areas for Cavanah, other ESG. showcase and continuous our stage stakeholders. employees I'd our a Kevin transparent reporting and identify corporate steward clearly, shape strategy our XXXX review to planning opportunity on success key discussion our the been outlook Report professional XXXX. share after and now results, supporting the community. Gas the accomplishments, improvement our metrics people acceleration partner fiscal environment, annual brighter fiscal the has will communities, an for quarter the being on XXXX, depends citizen, well-being, our a much our in of fiscal which of are including training pipeline role emissions, we word. including baseline who by trusted will first in to on in all and succession awards Report of set briefly to employee our And seeing and document all I our efforts, leadership finally, on health current call development. areas areas, like to safety, and as a and which baseline society Greenhouse business a the being enterprise-wide

Kevin Cavanah

for major a Thanks, year, project and fourth electrical by capital a Several $X.X pandemic. charge $XX was start profit events consolidated in third the the of million over contributed on and largely concerns The Despite of million a the due the capital the quarter. Infrastructure reviewing strong is will quarter, fourth Utility by schedule about The service quarter a increased almost work had in as and restrictions to to segment was project execution John. I the a and on completion. projects. start $X.X of fiscal was negative worked and employee increases safety up XX% project the supply Revenue results large by achieve an disruptions, enhanced volume the to project relatively by protocols, brought offset gross results. quarter startup travel difficult health weather impacted discuss to commissioning. good has each cost Power million compression revenue currently company to also chain and then COVID been as segment that

a have although a positive project at to margin. reduced the expect We outcome,

to over over impacted up was revenue negatively in that the points. of third under-recovery the XXX quarter, gross margins overheads low revenue Although result the basis by volume continued

the of segment produced under result a the As a recovery, of loss charge and operating quarterly million. project $X

of move expected fiscal we gross return as XXXX. segment through to XX% expect We this margin range our see XX% to to

margin a execution decent year. highest by strong as a and the and fiscal the as throughout revenue Process maintenance result of and near refinery turnaround revenue on above. the discussed million, refinery, the including had COVID up completed quarterly considering quarter the revenue maintenance and third segment, for under-recovery over project almost and was the turnaround of The overheads the increased impacted activity project well quarter, be environment activity. $XX the was was a number XXXX Facilities will fourth XX% as quarter Industrial segment term, However, lower good In

In of of been four has last three the to above expected our fact, quarters. direct range X% normal margin XX% gross in

a profit result was project in the good As improved operating recovery, and overhead million quarter was of million. gross and $X.X execution income $X.X

fiscal Terminal as seasonally we had a we a from margin to the rest revenue segment we mixed the Based be still expect As expectations year forward fiscal move the look segment increasing to our revenue projections, us and cash quarter In eliminate XXXX, recent XX% balance. avoid and through and the quarter a we charge company to million segment. X% segment successfully our first to which recorded results $X.X Storage current the received the up for $XX of finished expect allowed from litigation third on to long-term costs, in quarter financial receivable XXXX. this were quarter but XX% of XXXX. to for lower increasing million, the as risk by are by the and $X.X modestly traditionally settlement of settlement, a tough the quarter settled received project while future was This strong the XX%. this related The The environment. first settlement was the was Solutions reduction dispute in connection completed in impacted Revenue in less legal results The impacted in a on books increase revenue. recorded with of than our a net dispute any resulting company XXXX. million fiscal negatively that that and to earnings the

of Excluding XX% settlement earned the the impact, just direct XX%. normal to were the segment the margins range in below

As to million. under-recovery the basis over of produced in overheads, gross the and margin the an settlement and just revenue result of operating segment the low the of related segment under recovery Due points million loss volume, quarter. a charge to impacted $X.X $X by of gross profit XXX

this to margin As we XX%. our expect segment gross see forward, look XX% expected to return to of range we

However, term of still the under-recovery impacted be near overheads. could by

results; $XX the as quarter, revenue over while of our a quarter effects revenue the short were the of expectations XX% Moving up pandemic. fourth continuing the to about result million was third of overall levels consolidated

Although segment with was meet were to earnings negative years the the charge contract over our profit overhead in settlement led that Storage not or reductions EPS breakeven and by quarter of EPS revenue Solutions X.X% construction an still overheads due to dispute Infrastructure the volume Gross impacted our performance. Terminal the revenue have segment an expectations in SG&A expected EPS of of was cost a $X.X impact margin. million impacted the as compared gross in revenue. charge past did and of profit been in line the low The quarter. and of in $X.XX and which obvious $X.XX in positively project negatively which $X.XX. related gross It performance. compared and to end Power quarter that is expectations impacted operating of The the result and near as expectations, resulted two impacts under-recovery by significantly to costs the Utility our the lower-than-expected The loss to $X.XX achieving in implemented volume the benefit

of related So, I structure want and of impact our minutes a discuss cost the to future couple the management to on take earnings.

occurred consolidations, win portion included overhead. volume an construction headcount company's approach the cost reductions implemented have company and execute has annualized cost overhead approximate to significant closures the decrease effectively facility business the of but CapEx basis. have fiscal and will on are structure. for projects $XX reductions cost start we since the million add an of reductions, a resources XXXX, throughout the discussed as to company to of translates necessary As the revenue before, A Reductions non-labor almost the This overhead and returns. permanent zero-based XX% and reductions

cost the of company. the you As expect, earnings positively potential the would changes impact reduction future

structure, example, -- to the has cost breakeven approximately current results from million revenue about cost million. $XXX the For $XXX quarterly decreased achieve at required to

fiscal by million level, decrease and position the under-recovery $XXX awards overheads. have with we before the that for volumes reductions customers implemented, million overheads, backlog. we we volumes However, earnings as starts of that of to million impacted in project company The backlog construction project the related $XXX review let's of our see the takeaway Revenue construction by significant have implemented ended the as is XXXX. with required compared throughout negatively To revenue $XXX fiscal still year improvement recover improve. pandemic We the spending do cost quarterly were the big company so some about fully revenue awards, reductions. would improvement as cost at

will seeing cover in early improved the this later level from fiscal point. increase improvement are believe and call. We this backlog our award XXXX activity John in will

to volume support our move and as revenue activity previously, discussed fiscal award quarter XXXX. first operating improving we we near-term the is key earnings and our As prospects results improved through

flow; while of difficult of in maintain and operating cash able cash a and balances on with to ended We and Moving sheet the environment beginning the financial million debt compared to we zero were year. million balance position the strong $XX million. fiscal fiscal of $XXX of cash to debt XXXX, as was the throughout year $XX of XXXX

paid credit year, credit we Availability debt, $XX million base the During and off million basis of base determined of to $XX under is a volume borrowing increase to restructuring borrowing Subsequent we on entered the in initially million the facility and asset-backed business. by the new million $XXX replaces into $X monthly a is onetime is of year-end, CapEx million with million. facility spent that facility. previous calculated costs. expected the and funded $XXX $X The credit is new

issued but first almost half positioned call turn of $XX work. letters we are of of have John. back we of levels XX% expect I credit We fiscal now to believe will of support support the capacity letters million XXXX. these decrease in to to the borrowing increased anticipated to utilized we the Overall, credit project

John Hewitt

and uncertainty your I'd turn environment, The strength course however, the of by the of you, and and awards finally, are and year our Kevin. was business, earlier, clients Fiscal and to as for across to cases, and future clients. the employees, end long-term challenging reduced Today, and our energy all business mentioned the volume. activity market attention strategy; behind XXXX with current I'll significantly a fiscal delayed demanding cover us, you: bidding our additional With development, an fully the Thank opportunities XXXX bidding spending with economic areas environment with pandemic our end like the proposal strong, the business cycle. and demand estimate recovery, and segments around three has the we engaged teams and hired robust our award timing to in have resources some our markets. very assist is sustainability our

good sharp spending pent-up first also we beginning the through our of is to a move in as XXXX. that and clients are uptick This see fiscal quarter our clients We released a be awards by sign demand to minutes. detail in new will this few we moving invest to their more a and expected are is facilities. our in starting discuss I existing in in

now. strategy business about talk Let's

During our independent these areas: to the organization an properly designed future and third-party our with our execution third for fourth opportunities. Directionally, business we is excellence. assessed and we and to ensure have communication, and growth four quarters, be continues to worked opportunities that the on that support market appropriately clients and key strategy people focused safety, consultant

success. and people as to attract, Our focus critical develop ability well on retain safety the to as our our is

continue we for to world-class we performance, safety incident possible achieve know performance safety zero and goal. that strive a As is

number on our are today best-in-class we we provide and growth execution really one environment, clients culture, is to excellence. also I resource on ensuring leadership attention ensure our We focus employees. needed have the want our to and training remains people focus your But know and and

While deeper will that elements view direction. help our our investors time and on strategy, a prevent I touch limitations will entire key of intelligence appreciate competitive

will business next and fundamentally continue of is the as decade crude-related be transition will markets hold the part we energy a position. and critical markets where the a continue This These core. the to strong occurs brand to First, beyond. over we strengthen market

base to revenue. As and refining normalize, a more steady deliver will we operations high-quality maintenance competitiveness, for on work continue of build to services invested markets look our

growth the focused with in feel about are already tanks related our terminals sets to and and refining, will most crude Gulf we cases, in storage continue Coast In key crude the some logistical and of capabilities and other both and We are on. good opportunities skill targets believe be position support smaller transferable and other markets places.

opportunity where gas, existing LNG driven markets. within our business, a These terminals, existing In there either aerospace, source are infrastructure, gas and areas. market thermal by to natural addition, We expand chambers markets will markets for we and for a storage key many decades for midstream have is maturity, future. continue mining end international strong for terminal growth NGL will focus into energy all proposition a are in we and and expand vacuum our markets value electrical see that solutions or storage position minerals the as transition the

terminal system related Our peak renewable create a next nonferrous upgrade for both fiscal growth solutions, providing capabilities opportunities creates service domestically markets. and repair to is and an the in given well a long-term of opportunities set company, we here already electrical, cryogenics. East position centered facilities regrow in business. presence need for The midstream a United aging us for and will We demand support upgraded steady differentiator decade. and result commitment as infrastructure long-standing rare and growth expanded The delivery stream we energy infrastructure of and thermal storage Coast LNG The existing international and interconnected expect emerging the these the outsized select maintain especially of projects electrical and through and in spread across drive for earth our and to over and project investments. One States, create market potential niche for renewable expertise the shaving our is of our for coast-to-coast our organic need vacuum year testing. generation minerals in world and in more the a growth infrastructure the us to is in satellites significant activities skill chambers other space have for as the

can infrastructure Examples growing new capture adjacent project skills as petrochemical apply technical Finally, chemical scale our and utility new biofuels, and are opportunities or and energy to developing markets. renewable power carbon These solar. where the markets. and include through we renewable and we end are hydrogen facilities, such

and key source a hydrogen, public As and transportation, investment. heating more energy private receives generation future power for

building work, to put be new will infrastructure. national sets skill Our a

The experience significant on several near-term has our opportunities and partnership Industries, with opportunity impact combined our design teams is with construction, and having in that strategic are Our progressing. Chart partnership and positive storage our pipeline. project cryogenic already terminal

we hydrogen that cost-effective the faster with for provide developing implementation. standardized growth company. will our addition, is Recognizing area solutions In are and key a customers designs strategic turnkey

to Hydrogen focused applied future. recently the companies leading for have of a initiative We a more on CEO-led for hydrogen the Council, and membership better to foster energy transition global resilient advancing clean

hydrogen In solutions the infrastructure in capture support for carbon other the markets and addition, to look to chemicals we petrochemicals. of partners and continue for creation

master awards the opened markets. to expansion environment. marketing cases, the time, and organization all occur We funnel. for Over construction an touch prepare have and In acquisitions will improve in we engineering be opportunities required I engineering several business key in we industry. business. and are as in want see end in targeted by have brands to which penetration skills door approach started organically and project markets select design agreements market to started process our services also entire the the come what and on engineering, various market enterprise to the executing opportunities doing in returning provide creates our the project to development are our service our growth have will bid Small bidding

organization response have a to Again, and organization. of third-party shared reduced the as stated previously, the lean our efficiency now turn of centers structure operating well attention and process our consultant, have employing we business nearly by organization our a the million design strategies streamlining We pandemic. cost excellence $XX XX-week with on our in and to our help review operations We service embarked expanding management structure. of as model we've procurement structure, to explore review of a centers and

effective segments. and reporting resources with to across enterprise's our be more all objective Our efficient the is more administratively

expertise changes the consolidation development, completed organization we in the all apply of business. the is company's Service across at the enterprise, level. business this Company In the our development of profile, overall create center opportunities resources already grow more excellence way, business construction and One of one win improve the our better of the personnel risk with can a engineering and rate Matrix

and our capture will spending greatly quantity client by consolidation. of this Our base to enhanced across a ability broader be deeper

already seeing hydrogen, change and fuels of opportunities. benefit pursuit this are renewable of the in LNG, NGL-related We our

to expect a will and foundation performance As activities, we that and growth. positive business in complete redesign organization strong bottom our with competitive a we line improved benefits planning business see for more result

about I'd Now, awards. like to talk opportunities and

Our and and and energy which processing process strong such peak and pipeline of segments maintenance near opportunity the include for term all bidding and the is across gas, and and domestic Midstream import creating growth in is LNG is aspirations in infrastructure upgrades in for new as export in Key future. as inspection as hydrogen and facilities. well the of our transportation legacy transportation Renewable NGL and their distribution facilities, international opportunities positive opportunities supports expectations tanks expanded existing are terminals stage compression hubs centers. and many fuels LNG opportunities to revenue for improve the gaining footprint storage, infrastructure cases also efficiency opportunities. systems. strength carbon shaving,

storage fill basis. our processing biofuel our the international terminals building storage domestic terminals also pipeline tanks and continue In on both Crude addition, bid to are in oil and funnel. and

maintenance, expansion and maintenance this market for been very technology and mineral electric funnel upgrades offshore copper, While see backup strategic infrastructure and is enter for is to batteries the facilities plants to to our chambers, changes facilities. substations, data have for generation, near-term and on gold as and Chemical is starting awards. in with and builds been creating these solar work demand repair transmission, infrastructure and the transmission land-based minerals Mining design the as steady services, our and battery support Electrical driven vacuum storm in focus have storage future. manufacturing projects, and petrochemical renewable bid by construction and Thermal creating fluoride, are capital lithium competitive, distribution, satellite and projects opportunities. award and battery are slow growing silver engineering repair, new generation, associated cabling, and and distribution these wind, near improving infrastructure. pipeline we the

improved We markets our XXXX cycle of long returning service awaited deliver fourth and client We from believe quarter, for volume the including award the an move close of this are that chemical of $XXX have as booked formally new thermal represents of X.X. confidence awards highest has midstream be greater this our important level fourth contracts. fiscal we beginning book-to-bill clients. just days new subsequent gas agreements, activity storage tanks, acceleration other in cycle industrial the In of award that year. balance of we fiscal and through award full master wave notice progression happy sign this LNG million award to first our span follow accelerated. of the terminals, continue vacuum to quarter expect the or the first of The will These received the we contracts since and fiscal approximately and chambers, quarters of in tanks various than This impact to XXX infrastructure, award of projects and fiscal a XX of XXXX, many of the revenue and first following awards a biofuel including will API of award XXXX. our year and in markets, electrical report quarter key will

business. continue client variant Delta as So plans with of focus manage health The closing, first appear spending first the months not sustainability, more award actively our to policy. energy highest energy activity, project to quarters. in award last the to representing the the impact four a demand be with two federal the employees and significant activity order our in of is the we The fiscal XXXX cycle does having their and clean start economic accelerated strong to already on with safety

clear in the future. to to made but investments lower our world business protect markets, expand our transitions markets to as also is and not existing critical clients' carbon demonstrates a needs to infrastructure support new and core be strategy Our end existing our markets only commitment into grow

and pipeline we group, and near-term Our line opportunity long-term revenue centralized And and will safety, consistent as long-term on performance their organization continued our both vision during to newly objectives. the continuous and strong company. by highly redesign business driven create our quality is support for more focus finally, of period. bottom development on call supports improvement, and the and I'll our commitment questions. now the top performance extremely people I'm this for proud challenging our growth open

Operator

question Instructions] of [Operator first Thielman comes the Brent from line Our from D.A. Davidson.

Your question, please.

Brent Thielman

Great, thanks. Kevin. Good and morning, John

John Hewitt

Good morning.

Kevin Cavanah

Good morning.

Brent Thielman

Power pieces that's you you're about guess, talk how John, pressure these Utility especially with projects see activity? we executing see I just of on that the surprised the reverse new the of of and some function and can that, a moving Is upgrades and just quarter. I shaving guess, that? transition Group, then happening this this within quickly about with award the Can peak revenue delivery given you power just all the talked some on opportunities, still to

John Hewitt

Yes.

is there. in distribution there's development -- on pure segment, two One the So that of pieces work. transmission principal just substation infrastructure, revenue electrical

so reorganization well. We're that of that that kind the and ago, couple performance We, in business seeing and every to went to continuing years us. a through And for hit pretty rate. focus performing of grow of improve success is there is organization a

expand to core geography to the our kind continuing look that East of of outside on and opportunities so Coast. business for And we're

smaller that And LNG opportunities, to work. maintenance for work. see opportunities pipeline significant related peak the peak for opportunity shaving looking them upgrades And in of do seeing but LNG-related The continuing of work is we're and opportunities in our to we're country amount terminals other been albeit for utilities. infrastructure shaving years, had that piece for a segment existing we that for

-- collected storage here we've the the related will days last in of to One is XX that awards LNG. that we around

Brent Thielman

some of pretty in Okay, And you still then, are market, commentary sounds there. award those so mean, rest margins feel new ultracompetitive you how you've with new -- up? up markets? crude storage that's of the the I bid things helpful. environment this is activity bottom John, do assess the competitive. It the you're perking it coming of sort of -- would all it some but you picked work of like some about I How as is would how in the these off we're the cut and picking it's out? still

John Hewitt

Yes.

it I awards. say They in of segment there in. range. -- are are projects early which depends kind activity the these it's on the sub-$XX think -- are smaller award million general, I'd in

them of where competitively more Others in. -- competitively markets were a Some bid. are got in we've position are strong

like projects tank flat pipeline our liquids. where only but there's other mostly and two I storage to other biofuels -- sure, think when for now right that in not opportunities you crude are multiple look crude the the around, competitive. bottom available and things storage create in three for which tanks bid what's really and there market expansions but crude that market is And for is one, or tanks, also other market -- for

to to for And we're as think away six months for start we to starting so those still probably projects we opportunity us. well that four into turn And expand pipeline. an seeing in things

Brent Thielman

more the with it you was partnership several don't think that really to Chart think about talk can know then, you're be meaningful. But of another work. terms for just little inroads And for of and supposed the you a revenue I Industries hit maybe but at seeing on Okay. meaningful hydrogen-related in early starts when to I it's you quarters. the where kind you're in

John Hewitt

series at. we about initially we're individually think We to think XX still a felt of that call and new to working opportunities put some kind in infrastructure that a we're I storage frame -- out, want at most looking projects they existing I did looking talked jointly clients with project developer X who're We've and and blue-chip both months I'll of or still standpoint. expand those that's -- projects, was that some were, -- that in opportunities us for that's Yes. the And from time infrastructure. clients,

to I a small somebody should the it's sometime the the but after some it's they realistic set of opportunities, first on maybe or -- see calendar year, decision least whether competitive so of us whether us, for those is get fairly And else think we that at point there.

feel our where good so is. And we pretty position about

Brent Thielman

Okay.

ramp-up project last -- with cash the development thoughts liquidity, talk that get what at thoughts be kind I might reserving some Just sort looks the facility a about some just just to on you the with in you of business and versus credit one, your activity. and that M&A new gives around just liquidity then, you. flexibility be want have? looking of to opportunities Maybe

John Hewitt

primarily growth I There now, organic say return our us markets. there's there to strength right over. and a is we're on in focused to for mean, For grace lot --

And so consider as we that not opportunities business focused the there. any sizable will to of as acquisition, the on a is for And growth. but continue think, term, we I in kind for acquisitions -- we're table. need look But near to

Brent Thielman

Okay, thank you. Appreciate it.

Operator

line comes John Company. the from Sidoti & Our question from Franzreb of next

Your question, please.

John Franzreb

Morning, John and Kevin.

John Hewitt

morning. Good

John Franzreb

and little raise changed I the related want restructuring to bit the gross a gross the with margins? gives to what's process can But confidence you the about industrial assumptions. actions, and on you start and that mix margin in mix not based process to talk

John Hewitt

Kevin?

Kevin Cavanah

asking. So, what think know you're I I

there to from and XX%. X% range XX% of the the of process to new the we industrial on margin to did previous So increase XX% expectations range facilities,

over performance a direct at of has look performance. you from exceeded If normally couple years, segment expectations past our margin the that

volumes for there the it as strong. this volume because quarter, recovery segment. actual when in that We'd be result pandemic. into is the going work a diversity higher chamber gross saw that's and we move going revenue other look I segments. gross still piece we're predominant work, help a revenue under processing, do are But and we've in returns gas of projects, margin of and came mix would fully been the lower has to to we pretty margins lot continue Now vacuum a the revenues And -- work. drive we're range. it in our a with good work the expect built has been as examples there will margin refinery margin, you think through that that's the back as consistent of other I it's supplemented more segment. of to that at that to that the by fiscal up should with mining level mean get engineering we recovering thermal expectations just types increase it's see that that point, where But 'XX. That and minerals to work, few the recovery segment the two past, of to that under -- of to in at In have the

John Franzreb

two on Great. efforts, questions cost the here. And reduction

much versus the $XX million in that of delta back? does is And what Firstly, $XXX points. million to that And those between numbers? $XXX restructuring have at What's breakeven how variable? million the the come point

Kevin Cavanah

revenue, support of things about range the organization in positions 'XX. put $XX like wide either a that be it's of the there the we'll think fiscal So and talked, come we've will throughout amount as 'XX revenues to out We probably as need those of million, to quality of add permanent. I number back, management, of types control, areas, that's costs XX% cost of that costs project related And costs. talked that be I it's most that estimating, will some

XX% costs as we've least I come though. entire of so know will I fiscal the In come will cost permanent finally, is the because in. especially guess some answered environment in But addition, of and we for variable most is And earnings back compensation another traveling that Those that of been will year that will there question, costs have variable nobody if I there's your return 'XX low, in to is profitability, come that don't reduced piece I'd year. at costs, costs nature. back. back are extremely costs improve travel this then come like some say

John Franzreb

levels. difference other $XXX between part Yes, million is $XXX breakeven million, the No. the

Kevin Cavanah

Yes.

So, I'm glad asking you're about that.

breakeven So, level, if structure, revenue at but still have that we'd us have in unrecovered started a of -- before to required you couple that go to back quarter, it of overheads. years yes, our cost would trying point, $XXX to And just at a breakeven. million have reduce we

And so it the us $XXX taken to overheads. million fully have would recover

cost, targets overheads There'll is of for the is going level. the earnings. we're we've that result of $XXX the some to $XXX still under-recovery reach a about lowered be the breakeven point at As company. point reducing those where million million --

get around You $XXX to million.

that that And targets point, you those what And at you obviously, financial Now talked you're earnings -- of of the overheads. point margins XX% XX% see about, you'll to the margin full getting we've see recovery the statements. should see forward, to should be in from that further. improve

John Franzreb

is time Got Are kind expect on jobs? Is into they you awards those of us you -- duration? roll it give them far, of short-term the that do line it, kind Kevin. can to jobs? And $XXX million of a longer of P&L? on the When the so sense

John Hewitt

say I'm it's right the but I not -- cut number said I [Technical sure we would Difficulty]. it's now

Operator

Ladies your and remain line. gentlemen, on please

resume remain will call on line. momentarily. again, conference please Your Once your

resume may will call resume. conference you And momentarily. Your

John Hewitt

hear out. got us? kicked everybody Can We

Operator

hear we Yes, can you.

John Hewitt

good. Okay,

John Franzreb

Am I still left?

John Hewitt

Yes.

John Franzreb

pinging was operator. the poor I

of of we the and how John, heard last recent discussing So thing the that play the does I timing were was out? awards kind about

John Hewitt

right. Right,

around it -- the XX at awards -- sure the quarter -- as at number to go quarter increase that we're -- here. we I to expect within we I through So you was the days hit first first wouldn't million but around continue were $XXX heard had the and the

mixed projects. a those it's bag, So

revenue them, of them start impact until won't Some quarter. second most of any kind of having the in on general,

of so some will and multiyear them And them are through year, the -- of flush of combination fiscal this both. a be projects system some will it's

John Franzreb

credit guys. on facility. new going Okay. And my try here to more question luck One I'm

and your it? CapEx let spend little just not repurchase on changes guess, CapEx little your And a you the M&A to where ability at you're number a any how bit can You why I ability touched bit but about, about changes for XXXX on talk it fiscal to stock? in

Kevin Cavanah

yes. Yes,

out the increase. for for need on expect low little been than year at would last of level I obviously, CapEx CapEx, revenues pretty end we've us for to waiting months, So XX year, we'll a start return. the to we'll so CapEx the slower to a But

I million. $XX $X anticipating around million to CapEx think we're of total somewhere year, for currently the

we're the facility, we're we not certain saying to be something from the on would planning how we -- do restricted precluded but credit things. much now, about Now we're so. on need doing buybacks bit if credit for limited right we're on proactive I'm not are on other that we that's facility, And on doing a can CapEx.

earnings as done But last year will and think our buybacks been to for sheet good that. improve. we've for appetite think of -- we've a us maintain I job doing it's important stock improve, the balance this I strong

continue going so to be approach. our that's And to

want at of environment. in to cash. to aggressive back the profitable like earnings M&A a initiatives looking go major then uses really said, see improve, on we're this growth Just other and John get more We not we'll results little and

John Franzreb

my lot, a questions. taking Kevin. I Thanks appreciate

Kevin Cavanah

Thanks, John.

John Hewitt

Thanks, John.

Operator

Thank hand you. program. further Hewitt does this today's Instructions] conclude [Operator any for to the back of remarks. program to I'd session the question-and-answer John like And

John Hewitt

Thank their again. and you the calendar healthy and to as move we year. Thank you, the balance everybody everybody you. Thank be for safe attendance through today wish of

Operator

Thank you your conclude does in today's ladies program. gentlemen participation and This for conference. the

You may now Good day. disconnect.

Matrix Service (MTRX) 14 Sep 212021 Q4 Earnings call transcript