Financial Data and Key Metrics Changes - The company reported a gross margin of 22.3%, an increase of 100 basis points year-over-year despite a 5% decline in sales, indicating improved profitability [10] - Adjusted EBITDA for Q4 was $7.2 million, up $1.1 million or 18.7% compared to the previous year, primarily due to lower SG&A expenses [11] - Operating cash flow totaled $24.3 million in Q4, contributing to a reduction in net debt by $20.9 million to $44.5 million at quarter end [11][32] - The gross leverage ratio improved to 1.2 times, down from 1.9 times at the start of the quarter and 1.7 times from the previous year [12] Business Line Data and Key Metrics Changes - Net sales for the fourth quarter were $128.2 million, a decline of 5% due to a 3.8% organic sales decline in the infrastructure segment, while rail organic sales increased by 14.2% [16] - Rail segment revenues reached $79.2 million, up 14.2% year-over-year, driven by higher volumes in rail products and friction management [23] - Infrastructure solutions segment revenue decreased by 25.2% to $16.6 million, primarily due to soft market conditions in the steel products business [26] Market Data and Key Metrics Changes - The overall backlog decreased by approximately 13% year-over-year, with rail segment backlog down $22 million, largely due to strategic actions and lower market steel prices [41] - Protective coatings orders increased significantly to $8.6 million in Q4, up from $1.4 million the previous year, indicating a recovery in demand [52] Company Strategy and Development Direction - The company is focused on executing its strategic playbook, which includes expanding more profitable work programs and scaling back less profitable segments [46] - A new three-year $40 million stock repurchase program was authorized, reflecting confidence in cash generation and valuation [36][55] - The company plans to maintain a capital-light business model while investing approximately 2% of sales in CapEx to support organic growth initiatives [37] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about growth prospects in 2025, despite a softer start expected due to lower backlog levels and a volatile macro environment [48] - The company is monitoring government funding programs for rail infrastructure investments, which are expected to support long-term growth [49] - Management highlighted the importance of safety and operational efficiency, noting that a strong safety record contributes to overall business performance [59] Other Important Information - The company finalized the Union Pacific settlement funding in 2024, which is expected to improve cash generation by $8 million annually going forward [14] - The company has made significant progress in reducing SG&A expenses, which decreased by $1.2 million from the prior year [31] Q&A Session Summary Question: Can you discuss the 2025 guidance ranges for sales and EBITDA? - Management indicated that the guidance reflects a choppy market environment but expressed confidence in technology innovation driving sales and margins [64][66] Question: What factors could drive increased market adoption of new rail technologies? - Management noted that their products provide early detection warnings, enhancing safety and operational efficiency, which is increasingly valued by customers [70][72] Question: How will the new steel tariffs affect backlog? - Management stated that the backlog remains intact and that previous experiences with tariffs have been manageable, with strong relationships with domestic steel mills [90][92] Question: What is the rationale behind the $40 million share buyback program? - The decision was based on available cash from the Union Pacific settlement and anticipated operating cash generation [99] Question: How is the company factoring potential disruptions in national and state parks into its guidance? - Management remains optimistic about the precast concrete business, citing strong backlog and ongoing projects [110] Question: What parts of the business are expected to recover in the second half of the year? - Management expects recovery in protective coatings and infrastructure projects, particularly in Tennessee and Florida [115] Question: How will tariffs against Canada and Mexico impact the rail business? - Management believes that demand for their products will continue, and they have flexibility in pricing to manage potential cost increases [118][122]

Group 1 - L.B. Foster reported a quarterly loss of $0.02 per share, significantly missing the Zacks Consensus Estimate of $0.29, representing an earnings surprise of -106.90% [1] - The company posted revenues of $128.18 million for the quarter ended December 2024, which was 3.78% below the Zacks Consensus Estimate and down from $134.88 million a year ago [2] - L.B. Foster shares have declined approximately 4.2% since the beginning of the year, while the S&P 500 has decreased by -0.5% [3] Group 2 - The current consensus EPS estimate for the upcoming quarter is $0.25 on revenues of $131.81 million, and for the current fiscal year, it is $1.70 on revenues of $574.31 million [7] - The Steel - Producers industry, to which L.B. Foster belongs, is currently ranked in the bottom 13% of over 250 Zacks industries, indicating potential challenges for stock performance [8]

Financial Performance - L.B. Foster Company reported a 14.2% increase in rail segment sales, reaching $79.2 million in Q4 2024, with gross margins improving by 300 basis points to 22.2%[2][10] - Infrastructure segment sales decreased by 25.2% to $49.0 million in Q4 2024, with gross margins declining by 90 basis points to 22.6%[2][11] - The company achieved adjusted EBITDA of $7.2 million in Q4 2024, an increase of 18.7% compared to the prior year[2][4] - Free cash flow for the full year 2024 was $22.6 million, with total debt declining by $21.6 million to $46.9 million[2][4] - Net sales for the year ended December 31, 2024, were $530.8 million, a decrease of $13.0 million, or 2.4%, from the prior year[18] - Gross profit for the year ended December 31, 2024, was $118.1 million, an increase of $6.0 million, or 5.4%, with gross profit margins expanding by 160 basis points to 22.2%[18] - Operating income for the year ended December 31, 2024, was $20.5 million, an increase of $11.4 million over the prior year[18] - Net income attributable to the Company for the year ended December 31, 2024, was $42.9 million, or $3.89 per diluted share, favorable by $41.5 million over the prior year[18] - Adjusted EBITDA for the year ended December 31, 2024, was $33.6 million, a $1.8 million increase, or 5.7%, over the prior year[18] - Total net sales for Q4 2024 were $128.183 million, a decrease of 5.0% compared to $134.877 million in Q4 2023[36] - Gross profit for the fourth quarter of 2024 was $11.1 million, a decrease of $4.3 million, or 28.1%, from the prior year quarter[14] - Operating income for the year ended December 31, 2024, was $20.513 million, significantly higher than $9.107 million in 2023[28] - Adjusted EBITDA for Q4 2024 was $7.238 million, up from $6.099 million in Q4 2023, reflecting a growth of 18.7%[36] Orders and Backlog - The backlog as of Q4 2024 was $185.9 million, a decrease of 13.0% from the prior year, primarily due to lower demand in rail products[2][9] - New orders totaled $107.2 million in Q4 2024, reflecting a 1.6% increase year-over-year, driven by the Infrastructure Solutions segment[2][9] - New orders for the year ended December 31, 2024, totaled $506.5 million, a decrease of $22.5 million, or 4.3%, from the prior year[18] - Backlog as of December 31, 2024, was $185.9 million, a decrease of $27.9 million from the prior year[18] - New orders for Rail, Technologies, and Services increased to $308.394 million in 2024, a rise of 2.9% from $299.584 million in 2023[37] Expenses and Debt - Selling and administrative expenses decreased by 10.4% to $24.4 million in Q4 2024, contributing to improved profitability[2][6] - Selling and administrative expenses for the year ended December 31, 2024, were $96.4 million, a decrease of $1.2 million, or 1.3%, from the prior year[18] - The gross leverage ratio improved to 1.2x as of December 31, 2024, down from 1.7x a year earlier[2][7] - The company reported a net debt of $44.486 million as of December 31, 2024, down from $65.409 million in 2023[36] - Total stockholders' equity increased to $179.014 million in 2024, compared to $142.835 million in 2023[30] Future Outlook - L.B. Foster Company authorized a new 3-year $40 million stock repurchase program, replacing the previous $15 million program[2][5] - The company expects 2025 net sales to range from $540 million to $580 million, with adjusted EBITDA projected between $42 million and $48 million[2][3] Organic Sales - Organic sales declined by 3.8% in Q4 2024, with a reported decrease of $5.109 million compared to the previous year[36]

Core Insights - L.B. Foster Company reported strong cash generation and improved profitability in Q4 2024, with rail segment sales up 14.2% and gross margins increasing by 300 basis points to 22.2% [2][4][9] - The infrastructure segment faced challenges, with sales down 25.2% and gross margins decreasing by 90 basis points to 22.6% due to lower pipeline coating volumes [2][4][13] - The company achieved a net loss of $0.3 million in Q4 2024, an improvement from a loss of $0.5 million in the prior year [4][26] - Free cash flow was stronger than expected, allowing for debt reduction and an increase in share repurchases, totaling 300,302 shares or approximately 3% of outstanding shares [2][4][5] Financial Performance - Q4 2024 net sales were $128.2 million, a decrease of 5.0% from the prior year, while full-year 2024 net sales totaled $530.8 million, down 2.4% [4][12] - Gross profit for Q4 2024 was $28.6 million, flat compared to the prior year, with a gross profit margin of 22.3%, reflecting a 100 basis point improvement [4][6] - Selling and administrative expenses decreased by 10.4% in Q4 2024, contributing to improved operating income of $3.1 million [4][6][14] Segment Analysis - Rail, Technologies, and Services segment saw net sales of $79.2 million in Q4 2024, up 14.2% year-over-year, with gross profit increasing by 31.7% [7][9] - Infrastructure Solutions segment reported net sales of $49.0 million in Q4 2024, down 25.2% from the previous year, with a significant decline in gross profit [10][13] - New orders for the Rail segment decreased by 8.5%, while the Infrastructure segment saw a 14.9% increase in new orders [7][10] Guidance and Strategic Outlook - The company provided 2025 financial guidance, expecting net sales between $540 million and $580 million and adjusted EBITDA between $42 million and $48 million [3][4] - The guidance reflects a projected 34% growth in adjusted EBITDA driven by 5.5% organic sales growth, supported by federal infrastructure investment [2][3] - A new three-year $40 million share repurchase program was authorized, indicating confidence in future performance [5][4]

Core Viewpoint - L.B. Foster Company will release its fourth quarter and full year 2024 operating results on March 4, 2025, and will host a conference call to discuss these results and the market outlook [1][2]. Group 1: Earnings Release and Conference Call - The earnings release is scheduled for pre-market opening on March 4, 2025 [1]. - A conference call will take place at 11:00 A.M. Eastern Time on the same day to discuss operating results and business developments [1]. - The conference call will be available as a live webcast on the Company's Investor Relations page [2]. Group 2: Participation Details - Interested participants can register for the question-and-answer session to receive dial-in numbers and a unique PIN [3]. - It is recommended to join the call 10 minutes prior to the start time [3]. Group 3: Company Overview - L.B. Foster Company, founded in 1902, is a global technology solutions provider focused on engineered products and services for infrastructure [4]. - The Company operates in North America, South America, Europe, and Asia, addressing safety, reliability, and performance needs [4].

Core Viewpoint - L.B. Foster Company reported significant earnings growth in Q3 2024, with adjusted earnings surpassing expectations despite a decline in revenues and new orders. Financial Performance - The company logged Q3 2024 earnings of $3.27 per share, a substantial increase from 5 cents per share in the same quarter last year. Adjusted earnings were 54 cents per share, exceeding the Zacks Consensus Estimate of 49 cents [1] - Revenues for the quarter were $137.5 million, down approximately 5% year over year, and missed the Zacks Consensus Estimate of $144.6 million [2] - New orders totaled $96 million, reflecting a decrease of around 4% year over year [3] Segment Performance - Sales from the Rail, Technologies, and Services segment fell 8.5% year over year to $79.5 million, primarily due to a decline in Rail Products, which offset gains in Global Friction Management and Technology Services and Solutions [4] - The Infrastructure Solutions segment reported sales of $58 million, down roughly 1% year over year, impacted by the exit of the bridge grid deck product line [4] Financial Position - The company ended the quarter with cash and cash equivalents of approximately $3.1 million, a decrease of around 22% sequentially. Long-term debt was about $68.4 million, down roughly 21% from the prior quarter [5] - Cash provided by operating activities was $24.7 million for the quarter [5] Outlook - L.B. Foster expects adjusted EBITDA in the range of $34.5-$36.5 million for 2024 and net sales between $530-$540 million [6] Stock Performance - L.B. Foster's shares have increased by 17.4% over the past year, contrasting with a 5.8% decline in the industry [7]

Financial Data and Key Metrics Changes - The company reported a gross margin of 23.8%, the highest level in over a decade, up 490 basis points from the previous year [8] - Net income for the quarter was $35.9 million, which included a $30 million favorable tax valuation reserve adjustment [9][18] - Adjusted EBITDA was $12.3 million, reflecting a 16.4% increase year-over-year despite lower sales [9][19] - Cash from operations totaled $24.7 million, an increase of $6.1 million compared to the same quarter last year [20] Business Line Data and Key Metrics Changes - Net sales decreased by 5.4%, primarily due to domestic rail commercial weakness, with organic sales down 8.5% [15] - Rail segment revenues were $79.5 million, down 8.5% year-over-year, driven by weaker commercial conditions [24] - Infrastructure Solutions segment revenue decreased by $0.5 million or 0.9%, with growth in Precast Concrete offsetting declines in other areas [26] Market Data and Key Metrics Changes - The trailing 12-month organic growth rate was 3%, with a greater sales mix coming from growth platforms [23] - Rail orders increased by $2.9 million, driven by demand in Rail Products and Global Friction Management [25] - Infrastructure orders were $43.3 million, down $7.1 million from the prior year, primarily due to softer demand in Steel Products [27] Company Strategy and Development Direction - The company is focused on transforming its profitability profile and enhancing cash generation [8] - Capital spending is expected to run at approximately 1.5% to 2% of sales over the long term, with elevated spending in 2024 for growth platforms [38] - The company plans to continue its stock buyback program while maintaining a balanced view of leverage and growth [38] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the recovery of market conditions, particularly in the Rail segment, and highlighted strong demand in growth platforms [43][49] - The company anticipates a long-term infrastructure investment super cycle, which should support sustainable growth [49] - Management noted that while infrastructure markets are somewhat choppy, demand in growth platforms remains robust [44] Other Important Information - The company has made modest updates to its 2024 financial guidance, lowering sales expectations slightly but maintaining adjusted EBITDA outlook [12] - The effective tax rate is expected to return to approximately 28% starting in the fourth quarter due to the release of the federal tax valuation allowance [19] - The company is targeting a capital expenditure of $3.5 million to $4 million for a new facility in Central Florida, expected to begin production by the end of the year [61] Q&A Session Summary Question: What are the expected revenue targets for 2025? - Management indicated that revenue targets for 2025 are projected between $580 million and $620 million, driven by growth platforms and organic sales [56] Question: How should gross margins be viewed moving forward? - Management stated that while the current gross margin of 23.8% is higher than historical levels, they expect margins to remain between 22% and 23% in 2025 as part of their strategy to transform the company [59] Question: What is the timeline and CapEx for the new facility in Central Florida? - The facility is a brownfield installation with an expected first product by the end of the year, requiring a capital investment of $3.5 million to $4 million [61] Question: Will targeted bolt-on acquisitions focus on U.S. operations? - Management confirmed that approximately 95% of sales are in North America, and they plan to focus on U.S. operations for any bolt-on acquisitions [65]

Financial Performance - Net sales for the three months ended September 30, 2024 decreased by $7,879, or 5.4%, compared to the prior year quarter, driven by organic sales declines in the Rail and Infrastructure segments [112]. - Gross profit for the three months ended September 30, 2024 increased by $5,341, or 19.5%, with gross profit margins improving by 490 basis points to 23.8% [113]. - Selling and administrative expenses decreased by $132, or 0.5%, due to lower employment costs and bad debt expense, partially offset by higher legal and restructuring costs [114]. - Net income attributable to the Company for the three months ended September 30, 2024 increased by $35,390, or $3.22 per diluted share, driven by a favorable tax valuation allowance adjustment and gross profit improvement [117]. - Net income attributable to the Company for the nine months ended September 30, 2024 was $43,188, an increase of $41,294, or $3.74 per diluted share, over the prior year period [138]. Tax and Interest - The effective income tax rate for the three months ended September 30, 2024 was (483.4%), primarily due to a $30,045 income tax benefit from a change in valuation allowance against deferred tax assets [116]. - The Company's effective income tax rate for the nine months ended September 30, 2024 was (207.8%), compared to (5.9%) in the prior year period, primarily due to a significant income tax benefit [136]. - Net interest expense decreased by $84, with the outstanding debt balance at $68,544 as of September 30, 2024, down from $71,689 a year earlier [115]. Segment Performance - Rail segment net sales for the three months ended September 30, 2024 decreased by $7,368, or 8.5%, compared to the prior year quarter, primarily due to weaker domestic market conditions [118]. - Infrastructure segment net sales for the three months ended September 30, 2024 decreased by $511, or 0.9%, driven by a decline in the Steel Products business unit [122]. - Rail segment gross profit increased by $1,242, or 7.2%, with gross profit margins improving by 340 basis points to 23.2% [119]. - Infrastructure segment gross profit increased by $4,099, or 40.2%, with gross profit margins improving by 720 basis points to 24.6% [124]. - Segment operating income for the Rail segment increased by $1,067, with operating income margins improving by 170 basis points to 6.2% [120]. - Infrastructure segment operating income increased by $4,311 compared to the prior year quarter, reflecting higher gross profit and lower amortization expenses [125]. Orders and Backlog - New orders in the Rail segment for the current quarter were $52,675, an increase of $2,857, or 5.7%, compared to the prior year quarter [121]. - Infrastructure segment new orders decreased by $7,147, or 14.2%, driven entirely by the Steel Products business unit [126]. - New orders in the Rail segment were $253,412, an increase of $13,886, or 5.8%, compared to the prior year period [142]. - Infrastructure segment new orders decreased by $38,056, or 20.7%, primarily due to short-term constrained demand in the Steel Products business unit [146]. - Total backlog as of September 30, 2024, was $209,005, a decrease of $34,214 compared to the prior year quarter, driven by constrained demand in the Steel Products business unit [168]. Acquisitions and Divestitures - The Company sold the Chemtec business for $5,344, resulting in a $2,065 loss on sale, and the Ties business for $2,362, resulting in a $1,009 loss on sale [106][107]. - The Company acquired Cougar Mountain Precast, LLC for $1,644, expanding its Precast Concrete Products business unit within the Infrastructure segment [109]. - The Company announced the discontinuation of the Bridge Products grid deck product line due to weak market conditions, with sales of $921 and $283 for the three months ended September 30, 2024 and 2023, respectively [108]. Debt and Cash Management - The Company reported total debt of $68,544 as of September 30, 2024, an increase from $55,273 as of December 31, 2023 [152]. - The Company experienced an increase in outstanding debt of $12,162 for the nine months ended September 30, 2024, compared to a decrease of $20,262 in the prior year, primarily due to higher working capital needs [161]. - As of September 30, 2024, the Company had $3,135 in cash and cash equivalents and $59,707 available under its revolving credit facility, subject to covenant restrictions [164]. - The Company had $62,842 available funding capacity as of September 30, 2024, subject to covenant restrictions [153]. Restructuring and Operational Focus - The Company expects annual run-rate pre-tax savings of approximately $4,500 from its restructuring program, with $2,000 to be realized in 2024 [148]. - Capital expenditures for the nine months ended September 30, 2024, were $7,834, compared to $2,784 in the same period of 2023, indicating a focus on operational improvements and organic growth initiatives [160]. Internal Control and Governance - A material weakness in internal control over financial reporting was identified, impacting the effectiveness of the Company's disclosure controls and procedures as of September 30, 2024 [181]. - The company is committed to continuous improvement of its internal control over financial reporting, addressing identified material weaknesses [184]. - There were no changes to internal control over financial reporting that materially affected the company during the three and nine months ended September 30, 2024 [185]. - Management acknowledges that controls and procedures can only provide reasonable assurance of achieving desired control objectives due to resource constraints [186].

Financial Performance - Third quarter net sales were $137.5 million, down $7.9 million or 5.4% year over year[6] - Net income for the third quarter was $35.9 million, an increase of $35.4 million year over year, primarily due to a $30.0 million tax valuation allowance adjustment[8] - Adjusted EBITDA for the third quarter was $12.3 million, up 16.4% from the prior year[10] - Gross profit for Q3 2024 was $18.5 million, an increase of $1.2 million, with gross profit margins rising 340 basis points to 23.2%[14] - Segment operating income for Q3 2024 was $4.9 million, a $1.1 million increase compared to the prior year quarter, driven by improved gross profit[15] - Net sales for Q3 2024 were $58.0 million, a decrease of $0.5 million or 0.9% from Q3 2023, with an adjusted organic sales decline of 1.9%[17] - For the first nine months of 2024, net sales were $402.6 million, down $6.3 million or 1.5% from the prior year period[22] - Gross profit for the first nine months of 2024 was $89.4 million, a $6.1 million increase year-over-year, with gross profit margins increasing by 180 basis points to 22.2%[22] - Total net sales for the three months ended September 30, 2024, were $145,345, an increase of 5.4% compared to $137,466 for the same period in 2023[39] - The company reported a total adjusted sales change of $(9,856) million, representing a 6.7% decline from 2023 to 2024[48] Cash Flow and Operations - Cash provided by operations totaled $24.7 million, an increase of $6.1 million compared to the prior year quarter[12] - Cash used by operating activities in the nine months ended September 30, 2024 totaled $1.7 million, an increased use of $17.0 million compared to the prior year[29] - The company expects to generate approximately $30 million to $35 million in free cash flow in the second half of the year[3] - Cash and cash equivalents increased to $3,135 as of September 30, 2024, compared to $2,560 at the end of December 31, 2023[41] - Total current assets rose to $173,454 as of September 30, 2024, up from $167,355 at the end of December 31, 2023[41] Debt and Leverage - The Gross Leverage Ratio improved to 1.9x, a decrease of 0.8x during the quarter[12] - Long-term debt increased to $68,377 as of September 30, 2024, compared to $55,171 at the end of December 31, 2023[41] - The company reported a net debt of $65,242, calculated as total debt of $71,377 minus cash and cash equivalents[44] - Total debt as of September 30, 2024, was $68,544 million, down from $71,689 million a year earlier[48] - Net debt decreased to $65,409 million as of September 30, 2024, compared to $68,720 million in the same period of 2023[48] Orders and Backlog - New orders for the third quarter totaled $96.0 million, a decrease of $4.3 million or 4.3% from the prior year[11] - Backlog decreased to $209.0 million, down $34.2 million or 14.1% year over year[11] - Orders increased by $2.9 million year-over-year, with a backlog of $88.7 million, down $5.0 million from the prior year quarter[16] - New orders for Q3 2024 totaled $43.3 million, down $7.1 million from the prior year quarter, reflecting a decline in the Protective Coatings business[20] - New orders for the first nine months of 2024 totaled $399.4 million, a decrease of $24.2 million or 5.7% from the prior year period[28] Strategic Focus and Market Outlook - The company anticipates continued focus on strategic growth initiatives and market expansion in the upcoming quarters[40] - Capital spending as a percentage of sales is projected to be between 2.0% and 2.5% for 2024[4] - The company made adjustments to exclude non-routine costs, which are considered useful for evaluating ongoing operations[42] Profitability Metrics - Gross margin improved to 23.8%, the highest level in over ten years, reflecting a 490 basis point increase from the previous year[7] - Gross profit for Q3 2024 was $14.3 million, a $4.1 million increase, with gross profit margins increasing 720 basis points to 24.6%[18] - The gross profit margin for 2024 is reported at 23.8%, an increase from 18.9% in 2023[49] - The adjusted gross profit margin for 2023 was 21.2%, while the margin for 2024 is projected to be 22.3%[50] Income and Earnings - Operating income for the three months ended September 30, 2024, increased to $1,617 from $7,323 in the same period of 2023[39] - Net income attributable to L.B. Foster Company for the three months ended September 30, 2024, was $515, a significant decrease from $35,905 in the prior year[39] - The net income for the three months ended September 30, 2024, was $35,898 million, a significant increase from $447 million in the same period of 2023[47] - Organic sales growth for the three months ended September 30, 2024, showed a decline of 5.9% compared to the same period in 2023, with net sales reported at $137,466 million[48]

Core Viewpoint - L.B. Foster Company is set to release its third quarter results on November 7, 2024, and will host a conference call to discuss the results and market outlook [1]. Group 1 - The earnings release will occur pre-market opening on November 7, 2024 [1]. - A conference call is scheduled for 11:00 A.M. Eastern Time on the same day to discuss operating results and business developments [1]. - A presentation will be available on the Company's Investor Relations page immediately after the earnings release [1]. Group 2 - The conference call will be webcasted live and will be listen-only [2]. - A replay of the webcast will be available until November 14, 2024, on the Investor Relations page [2]. Group 3 - Interested participants can register for the question-and-answer session to receive dial-in numbers and a unique PIN [3]. - It is recommended to join the call 10 minutes prior to the start time [3]. Group 4 - L.B. Foster Company, founded in 1902, is a global technology solutions provider focused on engineered products and services for infrastructure [4]. - The Company operates in North America, South America, Europe, and Asia, addressing safety, reliability, and performance needs [4].