Great Lakes Dredge & Dock Corp. (NASDAQ: GLDD ) is an $850 million dredging services provider with a legacy tracing back to the 1890s. For those who are unaware, dredging refers to the process of excavating sediment orI specialize in analyzing individual stocks. With a strong educational background in both finance and economics, I’ve developed a deep fascination with the stock market and the potential it offers to investors at all levels. I keep a close watch on market trends, particularly in the tech secto ...

HOUSTON, Nov. 18, 2024 (GLOBE NEWSWIRE) -- Great Lakes Dredge & Dock Corporation ("Great Lakes" or the “Company”) (NASDAQ: GLDD), the largest provider of dredging services in the United States, announced that its newly launched Multi Cat dredge support vessels, Cape Hatteras and Cape Canaveral, have been awarded the prestigious 2024 Significant Boat of the Year title at the International WorkBoat Show. This award underscores the Company’s commitment to safety, innovation, and operational excellence in the d ...

[PART I — Financial Information (Unaudited)](index=3&type=section&id=Part%20I%20Financial%20Information%20(Unaudited)) This section presents the unaudited condensed consolidated financial statements for Great Lakes Dredge & Dock Corporation, including balance sheets, statements of operations, comprehensive income (loss), equity, and cash flows, along with detailed notes [Item 1. Financial Statements](index=3&type=section&id=Item%201%20Financial%20Statements) This section presents the unaudited condensed consolidated financial statements for Great Lakes Dredge & Dock Corporation, including balance sheets, statements of operations, comprehensive income (loss), equity, and cash flows, along with detailed notes explaining the basis of presentation, earnings per share, property and equipment, accrued expenses, long-term debt, fair value measurements, share-based compensation, revenue disaggregation, and commitments and contingencies [Condensed Consolidated Balance Sheets](index=3&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) This section provides a snapshot of the company's financial position, detailing assets, liabilities, and equity at specific points in time | ASSETS (in thousands) | Sep 30, 2024 | Dec 31, 2023 | | :-------------------- | :----------- | :----------- | | Total current assets | $214,732 | $226,328 | | Property and equipment—Net | $681,552 | $614,608 | | Total Assets | $1,145,339 | $1,110,840 | | **LIABILITIES AND EQUITY** | | | | Total current liabilities | $177,722 | $179,443 | | Long-term debt | $412,531 | $412,070 | | Total liabilities | $719,930 | $725,292 | | Total equity | $425,409 | $385,548 | | Total Liabilities and Equity | $1,145,339 | $1,110,840 | - Total assets increased by **$34.5 million (3.1%)** from December 31, 2023, to September 30, 2024, primarily driven by an increase in net property and equipment[4](index=4&type=chunk) - Total equity increased by **$39.86 million (10.3%)** over the nine-month period, indicating improved financial health[4](index=4&type=chunk) [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) This section details the company's financial performance over specific periods, showing revenues, expenses, and net income or loss | (in thousands, except per share) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Contract revenues | $191,173 | $117,185 | $559,919 | $407,896 | | Gross profit | $36,233 | $9,030 | $111,647 | $39,064 | | Operating income (loss) | $16,694 | $(5,123) | $62,758 | $(2,307) | | Net income (loss) | $8,852 | $(6,154) | $37,549 | $(7,652) | | Basic earnings (loss) per share | $0.13 | $(0.09) | $0.56 | $(0.12) | | Diluted earnings (loss) per share | $0.13 | $(0.09) | $0.55 | $(0.12) | - Contract revenues significantly increased by **63.1%** for the three months and **37.3%** for the nine months ended September 30, 2024, compared to the prior year periods[5](index=5&type=chunk) - The company returned to profitability, reporting net income of **$8.85 million** for Q3 2024 (vs. a loss of **$6.15 million** in Q3 2023) and **$37.55 million** for the nine months ended September 30, 2024 (vs. a loss of **$7.65 million** in the prior year period)[5](index=5&type=chunk) [Condensed Consolidated Statements of Comprehensive Income (Loss)](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) This section presents the total change in equity from non-owner sources, including net income and other comprehensive income or loss items | (in thousands) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net income (loss) | $8,852 | $(6,154) | $37,549 | $(7,652) | | Net change in cash flow derivative hedges—net of tax | $(2,661) | $2,155 | $(1,323) | $1,724 | | Comprehensive income (loss) | $6,191 | $(3,999) | $36,226 | $(5,928) | - Comprehensive income for the three months ended September 30, 2024, was **$6.19 million**, a significant improvement from a loss of **$4.00 million** in the prior year, primarily due to increased net income[7](index=7&type=chunk) - For the nine months ended September 30, 2024, comprehensive income was **$36.23 million**, reversing a loss of **$5.93 million** in the prior year period[7](index=7&type=chunk) [Condensed Consolidated Statements of Equity](index=7&type=section&id=Condensed%20Consolidated%20Statements%20of%20Equity) This section outlines changes in the company's equity over time, reflecting contributions, distributions, and net income or loss | (in thousands) | Jan 1, 2024 Balance | Sep 30, 2024 Balance | | :------------- | :------------------ | :------------------- | | Common Stock | $6 | $7 | | Additional Paid-In Capital | $317,337 | $320,971 | | Retained Earnings | $70,220 | $107,769 | | Accumulated Other Comprehensive (Loss) Income | $(2,015) | $(3,338) | | Total Equity | $385,548 | $425,409 | - Total equity increased by **$39.86 million** from January 1, 2024, to September 30, 2024, primarily driven by net income of **$37.55 million** and share-based compensation[10](index=10&type=chunk) - Retained earnings increased by **$37.55 million**, reflecting the company's profitability during the nine-month period[10](index=10&type=chunk) [Condensed Consolidated Statements of Cash Flows](index=9&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) This section summarizes the cash inflows and outflows from operating, investing, and financing activities, providing insight into liquidity | (in thousands) | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------- | :----------------------------- | :----------------------------- | | Net cash provided by operating activities | $83,581 | $49,577 | | Net cash used in investing activities | $(93,203) | $(96,978) | | Net cash (used in) provided by financing activities | $(2,102) | $54,948 | | Net (decrease) increase in cash, cash equivalents and restricted cash | $(11,724) | $7,547 | | Cash, cash equivalents and restricted cash at end of period | $12,037 | $14,093 | - Cash provided by operating activities increased by **$34.00 million (68.6%)** for the nine months ended September 30, 2024, compared to the prior year, primarily due to higher net income[12](index=12&type=chunk)[77](index=77&type=chunk) - Cash used in investing activities decreased slightly by **$3.78 million**, with significant investments in new build programs (Galveston Island, Amelia Island, Acadia) totaling **$90.2 million**[12](index=12&type=chunk)[79](index=79&type=chunk) - Financing activities shifted from providing **$54.95 million** in cash in 2023 to using **$2.10 million** in 2024, mainly due to net borrowings under the revolving debt facility and Second Lien Credit Agreement of **$10.0 million** in 2024 compared to **$55.0 million** in 2023, and **$10.9 million** in deferred financing fees[12](index=12&type=chunk)[79](index=79&type=chunk) [Notes to Condensed Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) This section provides detailed explanations and additional information supporting the condensed consolidated financial statements [1. Basis of presentation](index=11&type=section&id=1.%20Basis%20of%20presentation) This section outlines the accounting principles and methods used in preparing the financial statements - The unaudited condensed consolidated financial statements are prepared in accordance with SEC rules and GAAP, with certain information condensed or omitted[13](index=13&type=chunk) - The Company operates in one reportable segment (dredging) and performed its annual goodwill impairment test as of July 1, 2024, determining no impairment[15](index=15&type=chunk) - New accounting pronouncements, ASU 2023-09 (Income Taxes) and ASU 2023-07 (Segment Reporting), are effective for annual periods beginning after December 15, 2024, and will impact disclosures[17](index=17&type=chunk)[18](index=18&type=chunk)[20](index=20&type=chunk) [2. Earnings (loss) per share](index=12&type=section&id=2.%20Earnings%20(loss)%20per%20share) This section details the calculation of basic and diluted earnings per share, reflecting profitability on a per-share basis | (in thousands, except per share) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net income (loss) | $8,852 | $(6,154) | $37,549 | $(7,652) | | Weighted-average common shares outstanding — basic | 67,217 | 66,532 | 67,021 | 66,419 | | Earnings (loss) per share — basic | $0.13 | $(0.09) | $0.56 | $(0.12) | | Earnings (loss) per share — diluted | $0.13 | $(0.09) | $0.55 | $(0.12) | - Diluted EPS improved significantly to **$0.13** for Q3 2024 from a loss of **$0.09** in Q3 2023, and to **$0.55** for the nine months ended September 30, 2024, from a loss of **$0.12** in the prior year period[23](index=23&type=chunk) - The number of dilutive securities (stock options and RSUs) included in the diluted weighted average shares increased in 2024 due to the company's return to profitability[23](index=23&type=chunk) [3. Property and equipment](index=12&type=section&id=3.%20Property%20and%20equipment) This section provides details on the company's tangible long-term assets, including operating equipment and construction in progress | (in thousands) | Sep 30, 2024 | Dec 31, 2023 | | :------------- | :----------- | :----------- | | Operating equipment | $920,618 | $803,954 | | Construction in progress | $235,942 | $264,674 | | Total property and equipment | $1,187,866 | $1,099,380 | | Accumulated depreciation | $(506,314) | $(484,772) | | Property and equipment—net | $681,552 | $614,608 | - Net property and equipment increased by **$66.94 million (10.9%)** from December 31, 2023, to September 30, 2024, primarily due to an increase in operating equipment[24](index=24&type=chunk) - Construction in progress decreased by **$28.73 million**, indicating progress on capital projects, while operating equipment increased by **$116.66 million**[24](index=24&type=chunk) [4. Accrued expenses](index=13&type=section&id=4.%20Accrued%20expenses) This section details liabilities for expenses incurred but not yet paid, such as payroll, insurance, and interest | (in thousands) | Sep 30, 2024 | Dec 31, 2023 | | :------------- | :----------- | :----------- | | Payroll and employee benefits | $15,268 | $11,986 | | Insurance | $14,397 | $12,521 | | Interest | $5,962 | $2,388 | | Fuel hedge contracts | $3,467 | $2,918 | | Total accrued expenses | $44,062 | $37,361 | - Total accrued expenses increased by **$6.70 million (17.9%)** from December 31, 2023, to September 30, 2024[25](index=25&type=chunk) - Significant increases were observed in accrued payroll and employee benefits (**$3.28 million**) and accrued interest (**$3.57 million**)[25](index=25&type=chunk) [5. Long-term debt](index=13&type=section&id=5.%20Long-term%20debt) This section provides information on the company's long-term borrowing arrangements, including new credit agreements and interest rates - On April 24, 2024, the Company entered into a **$150.0 million** Second Lien Credit Agreement, with **$100.0 million** funded initially and an option for an additional **$50.0 million**[26](index=26&type=chunk)[27](index=27&type=chunk) - Net proceeds of approximately **$88.7 million** from the Second Lien Credit Agreement were used to repay ABL Credit Agreement amounts, cover fees, and fund general corporate purposes, including new build payments[27](index=27&type=chunk)[30](index=30&type=chunk) - The Second Lien Credit Agreement carries a weighted average interest rate of **13.02%** for Q3 2024 and matures on the earlier of April 24, 2029, or 91 days prior to the 2029 Senior Notes maturity[31](index=31&type=chunk)[34](index=34&type=chunk) - The ABL Credit Agreement was amended on April 24, 2024, modifying pricing, adding a minimum liquidity covenant, and providing a green loan option with lower interest rates for renewable energy projects[35](index=35&type=chunk)[36](index=36&type=chunk)[39](index=39&type=chunk) - As of September 30, 2024, the Company had zero borrowings on the ABL revolver (down from **$90.0 million** at Dec 31, 2023) and **$256.3 million** of availability under the ABL Amendment (up from **$122.3 million**)[39](index=39&type=chunk) - The weighted average interest rate on outstanding borrowings (after swaps) increased to **6.81%** at September 30, 2024, from **5.57%** at December 31, 2023[40](index=40&type=chunk) [6. Fair value measurements](index=16&type=section&id=6.%20Fair%20value%20measurements) This section describes how the company measures the fair value of its financial instruments, particularly derivatives, using various input levels | Derivatives (in thousands) | Sep 30, 2024 Assets | Sep 30, 2024 Liabilities | Dec 31, 2023 Assets | Dec 31, 2023 Liabilities | | :------------------------- | :------------------ | :----------------------- | :------------------ | :----------------------- | | Fuel hedge contracts | $0 | $3,467 | $0 | $2,918 | | Foreign currency exchange hedge contracts | $2 | $21 | $358 | $0 | | Interest rate swaps | $0 | $536 | $0 | $0 | | Total derivatives | $2 | $4,024 | $358 | $2,918 | - The Company uses Level 2 inputs for fair value measurements of derivative instruments, including fuel hedge contracts, foreign currency exchange hedge contracts, and interest rate swaps[42](index=42&type=chunk)[44](index=44&type=chunk)[45](index=45&type=chunk)[46](index=46&type=chunk) - Fuel hedge contract liabilities increased to **$3.5 million** at September 30, 2024, from **$2.9 million** at December 31, 2023, hedging **9.1 million gallons** through February 2026[44](index=44&type=chunk) - Interest rate swaps with a notional value of **$75 million** became effective August 5, 2024, converting variable-rate debt to a weighted average fixed rate of **11.623%**, resulting in a **$536 thousand** liability[46](index=46&type=chunk) [7. Share-based compensation](index=19&type=section&id=7.%20Share-based%20compensation) This section details the costs associated with equity-based awards granted to employees and directors - The Incentive Plan, approved May 5, 2021, permits granting stock options, stock appreciation rights, restricted stock, and restricted stock units for up to **1.5 million shares**, plus remaining shares from the Prior Plan[51](index=51&type=chunk) | (in thousands) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Compensation cost charged to expense | $3,500 | $1,800 | $6,100 | $4,200 | - Compensation cost related to share-based arrangements increased by **$1.7 million (94.4%)** for the three months and **$1.9 million (45.2%)** for the nine months ended September 30, 2024, compared to the prior year periods[51](index=51&type=chunk) [8. Revenue](index=19&type=section&id=8.%20Revenue) This section disaggregates the company's revenue by type of work and customer, and provides information on backlog - Total dredging backlog at September 30, 2024, was **$1.21 billion**, with an additional **$465.0 million** in domestic low bids pending award and **$44.9 million** in offshore wind performance obligations[51](index=51&type=chunk) Revenues by Type of Work (in thousands) | Revenues by Type of Work (in thousands) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------------------------------ | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Capital—U.S. | $108,682 | $54,602 | $249,329 | $125,234 | | Coastal protection | $43,913 | $23,567 | $178,034 | $131,362 | | Maintenance | $37,867 | $33,816 | $130,742 | $141,553 | | Rivers & lakes | $711 | $5,200 | $1,814 | $9,747 | | Total revenues | $191,173 | $117,185 | $559,919 | $407,896 | Revenues by Customer Type (in thousands) | Revenues by Customer Type (in thousands) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Federal government | $85,876 | $78,681 | $339,352 | $328,211 | | State and local government | $39,330 | $33,316 | $108,493 | $74,497 | | Private | $65,967 | $5,188 | $112,074 | $5,188 | | Total revenues | $191,173 | $117,185 | $559,919 | $407,896 | - U.S. Capital dredging revenue increased by **99%** for both the three and nine months ended September 30, 2024, driven by projects in Texas and the new Galveston Island hopper dredge[52](index=52&type=chunk)[72](index=72&type=chunk) - Private sector revenue saw a substantial increase, growing from **$5.19 million** to **$65.97 million** (QoQ) and **$5.19 million** to **$112.07 million** (YoY), reflecting diversification[53](index=53&type=chunk) [9. Commitments and contingencies](index=20&type=section&id=9.%20Commitments%20and%20contingencies) This section outlines the company's contractual obligations, potential liabilities from legal matters, and lease agreements - The Company had outstanding performance bonds with a notional amount of approximately **$1.32 billion** at September 30, 2024, covering **$875.8 million** in dredging backlog revenue[56](index=56&type=chunk) - The Company is not currently a party to any material legal proceedings or environmental claims, and any potential liabilities are accrued when probable and estimable[58](index=58&type=chunk) - Lease obligations for equipment and facilities include renewal/purchase options and default provisions linked to the ABL Amendment's debt maturity acceleration[59](index=59&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=22&type=section&id=Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) This section provides management's perspective on the Company's financial performance, condition, and future outlook, covering operational highlights, detailed revenue and profit analysis, bidding activity and backlog, liquidity and capital resources, and critical accounting policies [General](index=22&type=section&id=General) This section provides an overview of the company's business, market position, and strategic initiatives, including expansion into offshore wind energy - Great Lakes is the largest provider of dredging services in the U.S. and is expanding into the offshore wind energy industry[63](index=63&type=chunk) - The Company's dredging revenues from federal government agencies decreased to approximately **61%** in the first nine months of 2024 (from **74%** average in 2023), due to increased revenues from state, local, and private customers[63](index=63&type=chunk) - Dredging began on two significant LNG projects (Port Arthur LNG Phase 1 and Brownsville Ship Channel) in Q3 2024, with the latter being the largest project in the Company's history[64](index=64&type=chunk) - The Company's first U.S. flagged Jones Act compliant, inclined fall-pipe vessel, the Acadia, is expected to be delivered and operational in H2 2025, supporting the growing U.S. offshore wind market[64](index=64&type=chunk) - The U.S. offshore wind development pipeline expanded by **53%** over the past year to approximately **80.5 GW**, with the Company securing rock installation contracts for Empire Wind I and Sunrise Wind projects[65](index=65&type=chunk)[66](index=66&type=chunk) [Results of operations](index=24&type=section&id=Results%20of%20operations) This section analyzes the company's financial performance, including gross profit, operating income, net income, and Adjusted EBITDA, and their drivers Metric (as % of Contract Revenues) | Metric (as % of Contract Revenues) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :--------------------------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Gross profit | 19.0% | 7.7% | 19.9% | 9.6% | | Operating income (loss) | 8.7% | (4.4%) | 11.2% | (0.5%) | | Net income (loss) | 4.6% | (5.4%) | 6.7% | (1.9%) | | Adjusted EBITDA | 14.1% | 4.6% | 17.1% | 7.9% | Net Income (Loss) and Adjusted EBITDA (in thousands) | (in thousands) | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :------------- | :------------------------------ | :------------------------------ | :----------------------------- | :----------------------------- | | Net income (loss) | $8,852 | $(6,154) | $37,549 | $(7,652) | | Adjusted EBITDA | $26,983 | $5,332 | $95,728 | $32,186 | - Consolidated gross profit increased by **302%** (QoQ) and **185%** (YoY), with margins improving to **19.0%** and **19.9%** respectively, driven by increased revenues, improved utilization, and a higher proportion of capital and coastal protection projects[73](index=73&type=chunk) - Operating income significantly improved to **$16.7 million** (QoQ) and **$62.8 million** (YoY) from losses in the prior year periods, despite higher general and administrative expenses[73](index=73&type=chunk) - Net interest expense increased due to higher borrowings and the Second Lien Credit Agreement, while the income tax provision increased due to higher pre-tax income[73](index=73&type=chunk) - Adjusted EBITDA increased by **406%** (QoQ) and **197%** (YoY), reflecting strong operational performance[73](index=73&type=chunk) [Bidding activity and backlog](index=27&type=section&id=Bidding%20activity%20and%20backlog) This section reviews the company's bidding performance and the status of its project backlog, indicating future revenue potential | Backlog (in thousands) | Sep 30, 2024 | Dec 31, 2023 | Sep 30, 2023 | | :--------------------- | :----------- | :----------- | :----------- | | Capital—U.S. | $898,898 | $741,839 | $736,322 | | Coastal protection | $218,321 | $138,394 | $103,617 | | Maintenance | $89,050 | $152,104 | $182,470 | | Rivers & lakes | $6,870 | $6,765 | $11,320 | | Total backlog | $1,213,139 | $1,039,102 | $1,033,729 | - Total dredging backlog increased to **$1.21 billion** at September 30, 2024, up from **$1.04 billion** at December 31, 2023, with significant growth in U.S. Capital and Coastal Protection segments[75](index=75&type=chunk) - The backlog does not include **$465.0 million** of domestic low bids pending formal award and **$44.9 million** of offshore wind performance obligations[75](index=75&type=chunk) - The domestic dredging bid market for Q3 2024 was **$1.31 billion**, a **$454.9 million** increase YoY, with the Company winning **30%** of the **$2.49 billion** year-to-date market[76](index=76&type=chunk) - The 2024 Energy and Water Appropriations Bill provided a record **$8.7 billion** to the Corps, supporting a strong bid market, and the 2025 budget is expected to be another record[75](index=75&type=chunk) [Liquidity and capital resources](index=28&type=section&id=Liquidity%20and%20capital%20resources) This section discusses the company's ability to generate and manage cash, including operating cash flows, investing activities, and financing strategies - Cash provided by operating activities increased to **$83.6 million** for the nine months ended September 30, 2024, from **$49.6 million** in the prior year, driven by higher earnings[77](index=77&type=chunk) - Investing activities included **$102.5 million** in property and equipment purchases, with major investments in the Galveston Island (**$5.1 million**), Amelia Island (**$29.1 million**), and Acadia (**$56.0 million**) new build programs[79](index=79&type=chunk) - Financing activities resulted in a net use of **$2.1 million**, compared to a net provision of **$54.9 million** in the prior year, primarily due to the Second Lien Credit Agreement and associated fees[79](index=79&type=chunk) - The Company expects 2024 capital expenditures to be between **$130 million** and **$150 million**, funded by cash on hand, operations, revolver availability, and the Second Lien Credit Agreement[79](index=79&type=chunk) [Commitments, contingencies and liquidity matters](index=29&type=section&id=Commitments,%20contingencies%20and%20liquidity%20matters) This section addresses the company's credit ratings, its ability to meet financial obligations, and factors influencing future funding - The Company's credit ratings were upgraded by S&P Global Ratings from CCC+ to B- with a stable outlook in Q3 2024, and Moody's changed its outlook from negative to stable, reaffirming B2[80](index=80&type=chunk) - Management believes current cash, anticipated operating cash flows, and revolving credit facility availability are sufficient to fund operations, capital expenditures, and debt service for the next twelve months[80](index=80&type=chunk) - Future funding beyond 12 months depends on operating performance, cash flows, economic conditions, and compliance with financial covenants[80](index=80&type=chunk) [Critical accounting policies and estimates](index=29&type=section&id=Critical%20accounting%20policies%20and%20estimates) This section confirms that the company's key accounting policies and estimates remain consistent with previous reports - The Company's critical accounting policies and estimates remain materially unchanged since December 31, 2023, as detailed in its Annual Report on Form 10-K[81](index=81&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=30&type=section&id=Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The Company's market risk profile for its financial instruments has not materially changed as of September 30, 2024, compared to December 31, 2023 - No material changes in the market risk of the Company's financial instruments were reported as of September 30, 2024, compared to December 31, 2023[83](index=83&type=chunk) [Controls and Procedures](index=30&type=section&id=Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the effectiveness of the Company's disclosure controls and procedures as of September 30, 2024, concluding they were effective, with no material changes in internal control over financial reporting during the quarter - The Company's disclosure controls and procedures were evaluated and deemed effective as of September 30, 2024[84](index=84&type=chunk)[85](index=85&type=chunk) - No material changes in internal control over financial reporting occurred during the fiscal quarter ended September 30, 2024[86](index=86&type=chunk) [PART II — Other Information](index=31&type=section&id=Part%20II%20Other%20Information) This section provides additional information not covered in Part I, including legal proceedings, risk factors, equity sales, defaults, and other disclosures [Item 1. Legal Proceedings.](index=31&type=section&id=Item%201.%20Legal%20Proceedings.) The Company refers to Note 9, Commitments and contingencies, for details on legal proceedings, which states that the Company is not currently a party to any material legal proceedings or environmental claims - The Company is not currently involved in any material legal proceedings or environmental claims[58](index=58&type=chunk)[88](index=88&type=chunk) [Item 1A. Risk Factors.](index=31&type=section&id=Item%201A.%20Risk%20Factors.) There have been no material changes to the previously disclosed risk factors, except for the potential adverse impact of the unpredictable political environment and governmental fiscal/monetary policies, particularly concerning federal spending and support for the dredging and offshore wind industries - No material changes to risk factors were reported, except for the potential adverse effects of the political environment and governmental policies[89](index=89&type=chunk) - Uncertainty from the 2024 U.S. presidential election could impact business, economic growth, and financial stability, potentially reducing federal funding for dredging and offshore wind development[90](index=90&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.](index=31&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds.) There were no unregistered sales of equity securities or use of proceeds to report - No unregistered sales of equity securities or use of proceeds were reported[91](index=91&type=chunk) [Item 3. Defaults Upon Senior Securities.](index=31&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities.) There were no defaults upon senior securities to report - No defaults upon senior securities were reported[91](index=91&type=chunk) [Item 4. Mine Safety Disclosures.](index=31&type=section&id=Item%204.%20Mine%20Safety%20Disclosures.) This item is not applicable to the Company - Mine Safety Disclosures are not applicable to the Company[91](index=91&type=chunk) [Item 5. Other Information.](index=31&type=section&id=Item%205.%20Other%20Information.) This section details the termination of a Rule 10b5-1 trading arrangement by the CEO, Lasse Petterson, on August 26, 2024, under which 250,000 shares were sold, with no other officers or directors adopting or terminating trading plans during the quarter - CEO Lasse Petterson terminated a Rule 10b5-1 trading arrangement on August 26, 2024, after selling **250,000 shares**[93](index=93&type=chunk) - No other officers or directors adopted or terminated Rule 10b5-1 trading plans or non-Rule 10b5-1 trading arrangements during the quarter ended September 30, 2024[94](index=94&type=chunk) [Exhibits](index=31&type=section&id=Exhibits) This section lists the exhibits filed with the Form 10-Q, including certifications under the Sarbanes-Oxley Act and Interactive Data Files - The report includes certifications pursuant to Rules 13a-14 and 15d-14 (Sarbanes-Oxley Act Sections 302 and 906) and Interactive Data Files in Inline XBRL format[94](index=94&type=chunk) [SIGNATURE](index=33&type=section&id=SIGNATURE) This section formally concludes the report with the authorized signature of a company officer [Signature](index=33&type=section&id=Signature) The report was duly signed on behalf of Great Lakes Dredge & Dock Corporation by Scott Kornblau, Senior Vice President and Chief Financial Officer, on November 5, 2024 - The report was signed by Scott Kornblau, Senior Vice President and Chief Financial Officer, on November 5, 2024[96](index=96&type=chunk)

Financial Data and Key Metrics Changes - The company reported a net income of $8.9 million for Q3 2024, compared to a net loss of $6.2 million in the same quarter of the previous year [15] - Adjusted EBITDA for the quarter was $27 million, up from $5.3 million year-over-year [15] - Revenues increased to $191.2 million, a rise of $74 million from Q3 2023, primarily driven by the Galveston Island's project activity and higher capital and coastal protection project revenues [12][13] - Gross profit reached $36.2 million with a gross profit margin of 19%, significantly up from $9 million and 7.7% in Q3 2023 [14] Business Line Data and Key Metrics Changes - The company secured $543 million in new contracts during the quarter, including significant wins in beach renourishment and port deepening projects [5] - The backlog reached a record $1.2 billion, with an additional $465 million in pending award low bids and options [6] - Offshore wind backlog stood at $44.6 million, with $12.7 million in options pending award [9] Market Data and Key Metrics Changes - The U.S. offshore wind development pipeline expanded by 53% over the past year, with a potential generating capacity of approximately 80.5 gigawatts by 2025 [23] - The 2024 Energy and Water Appropriation Bill allocated a record $8.7 billion to the U.S. Army Corps of Engineers, supporting a strong bid market [20] Company Strategy and Development Direction - The company is focused on entering the U.S. offshore wind market, with the Acadia vessel under construction and contracted for significant projects [8][9] - The company aims to modernize its fleet with efficient dredges and expand into the growing offshore wind market, generating value for shareholders [24] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong bid market for 2024 and anticipated solid funding for the U.S. Army Corps of Engineers in 2025 [21][22] - The company expects utilization and revenues to increase in Q4 2024, with margins also projected to rise due to favorable environmental windows [18][19] Other Important Information - The company ended Q3 2024 with $12 million in cash and total liquidity of over $318 million, with no debt maturities until 2029 [16] - Capital expenditures for Q3 2024 totaled $38.4 million, with guidance for the full year remaining between $130 million and $150 million [17] Q&A Session Summary Question: What is the award environment for the fourth quarter? - Management indicated that $90 million of low bids pending at the end of Q3 were already awarded, with expectations for more awards in Q4 [29][30] Question: Are there any delays in the Acadia project due to the Philly Shipyard sale? - Management confirmed that the sale is expected to proceed positively, with no current delays in the Acadia project timeline [32] Question: What is the competitive environment like? - The competitive environment remains stable, with some competitors retiring older dredges, which helps maintain capacity [34] Question: Can you provide insights on dredging gross margins? - The gross margin of 19% was solid, with an expedited dry docking costing approximately $2 million to $2.5 million impacting Q3 margins [37] Question: What are the expectations for Q4 top line revenue? - Management expects a very strong revenue quarter, with all active vessels working and a significant portion of the backlog to be earned [47]

Group 1: Earnings Performance - Great Lakes Dredge & Dock (GLDD) reported quarterly earnings of $0.13 per share, missing the Zacks Consensus Estimate of $0.18 per share, compared to a loss of $0.09 per share a year ago [1] - The earnings surprise for this quarter was -27.78%, while the previous quarter saw a positive surprise of 266.67% with actual earnings of $0.11 per share against an expected $0.03 [2] - Over the last four quarters, the company has surpassed consensus EPS estimates three times [2] Group 2: Revenue Performance - The company posted revenues of $191.17 million for the quarter ended September 2024, exceeding the Zacks Consensus Estimate by 5.74%, and up from $117.19 million year-over-year [3] - Great Lakes Dredge & Dock has topped consensus revenue estimates three times over the last four quarters [3] Group 3: Stock Performance and Outlook - The stock has gained approximately 51.2% since the beginning of the year, outperforming the S&P 500's gain of 19.8% [4] - The future performance of the stock will depend on management's commentary during the earnings call and the earnings outlook [4][5] - The current consensus EPS estimate for the upcoming quarter is $0.21 on revenues of $199.95 million, and for the current fiscal year, it is $0.80 on revenues of $749.53 million [8] Group 4: Industry Context - Great Lakes Dredge & Dock operates within the Zacks Building Products - Heavy Construction industry, which is currently ranked in the top 14% of over 250 Zacks industries [9] - The performance of the stock may be influenced by the overall outlook for the industry, as top-ranked industries tend to outperform lower-ranked ones significantly [9]

[Third Quarter 2024 Performance Overview](index=1&type=section&id=Third%20Quarter%202024%20Performance%20Overview) Great Lakes reported strong third-quarter 2024 results with significant net income and Adjusted EBITDA, achieving a record dredging backlog of $1.21 billion driven by new project wins and strategic initiatives [Third Quarter 2024 Highlights](index=1&type=section&id=Third%20Quarter%202024%20Highlights) Great Lakes reported strong third-quarter 2024 results, with net income of $8.9 million and Adjusted EBITDA of $27.0 million, achieving a record dredging backlog of $1.21 billion, driven by significant new project wins Q3 2024 Key Financial Metrics | Metric | Value (USD) | | :--- | :--- | | Revenue | $191.2 million | | Total operating income | $16.7 million | | Net income | $8.9 million | | Adjusted EBITDA | $27.0 million | | Record dredging backlog | $1.21 billion | [Management Commentary](index=1&type=section&id=Management%20Commentary) Management highlighted a solid third quarter with strong project performance and substantial new work, resulting in a record backlog of $1.21 billion, with key strategic initiatives including progress on the new build program and securing contracts in the U.S. offshore wind market, while strengthening the company's financial position - Awarded **$543.0 million** of new work in Q3, including the **$235 million** Sabine-Neches Contract 6 Deepening project[2](index=2&type=chunk) - Ended Q3 with a record backlog of **$1.21 billion**, with an additional **$465.0 million** in low bids and options pending, providing revenue visibility into 2026[2](index=2&type=chunk) - Progress continues on new vessel construction: the hopper dredge 'Amelia Island' and the subsea rock installation vessel 'Acadia' are both expected for delivery in the second half of 2025[4](index=4&type=chunk)[5](index=5&type=chunk) - The company is entering the U.S. offshore wind market, having secured contracts for Equinor's Empire Wind 1 and Ørsted's Sunrise Wind projects for the 'Acadia' vessel[5](index=5&type=chunk) - Strengthened liquidity by entering a **$150 million** second-lien credit agreement and received a credit rating upgrade from S&P Global Ratings to 'B-' from 'CCC+'[8](index=8&type=chunk) [Financial and Operational Review](index=2&type=section&id=Financial%20and%20Operational%20Review) The company demonstrated significant operational improvements in Q3 2024, with increased revenue and profitability, supported by a strong market outlook driven by robust government funding and growth in the U.S. offshore wind sector [Operational Update](index=2&type=section&id=Operational%20Update) The company saw significant year-over-year improvement in the third quarter of 2024, with revenue increasing by **$74.0 million** to **$191.2 million**, gross profit improving by **$27.2 million**, and net income turning positive at **$8.9 million**, while the dredging backlog grew to **$1.21 billion** and capital expenditures for the quarter were **$38.4 million** primarily for new vessel construction Q3 2024 vs Q3 2023 Operational Performance | Metric | Q3 2024 | Q3 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $191.2M | $117.2M | +$74.0M | | Gross Profit | $36.2M | $9.0M | +$27.2M | | Gross Margin | 19.0% | 7.7% | +11.3 ppt | | Operating Income | $16.7M | ($5.1M) | +$21.8M | | Net Income | $8.9M | ($6.2M) | +$15.1M | - At September 30, 2024, the company had **$12.0 million** in cash and cash equivalents and **$412.5 million** in total long-term debt, with no draws on its **$300 million** revolver[9](index=9&type=chunk) - Total capital expenditures for Q3 2024 were **$38.4 million**, including **$19.4 million** for the 'Acadia' and **$13.6 million** for the 'Amelia Island'[9](index=9&type=chunk) [Market Update](index=2&type=section&id=Market%20Update) The market outlook remains positive, with strong government support for the dredging industry through record funding for the U.S. Army Corps of Engineers and bipartisan backing for the Water Resources Development Act (WRDA), while the U.S. offshore wind market is experiencing significant growth, presenting unique opportunities for Great Lakes' new subsea rock installation vessel - The 2024 Energy and Water Appropriations Bill provided a record **$8.7 billion** to the U.S. Army Corps of Engineers, supporting a strong bid market[10](index=10&type=chunk) - The proposed 2025 Corps' budget is expected to be another record, with the House bill at **$9.96 billion** and the Senate bill at **$10.3 billion**[11](index=11&type=chunk) - The U.S. offshore wind development pipeline has expanded by **53%** in the past year, with a potential generating capacity of approximately **80.5 GW** by 2035[16](index=16&type=chunk) - Great Lakes has secured rock installation contracts for the Empire Wind 1 and Sunrise Wind projects, which recently finalized power deals with New York State[15](index=15&type=chunk) [Financial Statements and Supplementary Data](index=5&type=section&id=Financial%20Statements%20and%20Supplementary%20Data) This section provides detailed financial statements, including consolidated statements of operations, Adjusted EBITDA reconciliation, balance sheet highlights, and segment-wise revenue and backlog data, illustrating the company's financial performance and position [Condensed Consolidated Statements of Operations](index=5&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) The company's statement of operations shows a significant turnaround, with net income of **$8.9 million** (or **$0.13** per diluted share) for the third quarter of 2024, compared to a net loss of **$6.2 million** (or **-$0.09** per share) in the same period of 2023, and for the nine months ended September 30, 2024, net income was **$37.5 million**, a substantial improvement from a net loss of **$7.7 million** in the prior year period Statement of Operations Summary (in thousands, except per share data) | Metric | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | Contract revenues | $191,173 | $117,185 | $559,919 | $407,896 | | Gross profit | $36,233 | $9,030 | $111,647 | $39,064 | | Operating income (loss) | $16,694 | $(5,123) | $62,758 | $(2,307) | | Net income (loss) | $8,852 | $(6,154) | $37,549 | $(7,652) | | Diluted EPS | $0.13 | $(0.09) | $0.55 | $(0.12) | [Reconciliation of Net Income (Loss) to Adjusted EBITDA](index=6&type=section&id=Reconciliation%20of%20Net%20Income%20%28Loss%29%20to%20Adjusted%20EBITDA) Adjusted EBITDA for the third quarter of 2024 was **$27.0 million**, a significant increase from **$5.3 million** in the third quarter of 2023, and for the nine-month period, Adjusted EBITDA rose to **$95.7 million** from **$32.2 million** in the prior year, reflecting improved operational performance Adjusted EBITDA Reconciliation (in thousands) | Metric | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | Nine Months Ended Sep 30, 2024 | Nine Months Ended Sep 30, 2023 | | :--- | :--- | :--- | :--- | :--- | | Net income (loss) | $8,852 | $(6,154) | $37,549 | $(7,652) | | Adjustments | $18,131 | $11,486 | $58,179 | $39,838 | | **Adjusted EBITDA** | **$26,983** | **$5,332** | **$95,728** | **$32,186** | [Selected Balance Sheet Information](index=6&type=section&id=Selected%20Balance%20Sheet%20Information) As of September 30, 2024, the company's balance sheet shows total assets of **$1.15 billion** and total equity of **$425.4 million**, with cash and cash equivalents standing at **$12.0 million** and total long-term debt at **$412.5 million** Balance Sheet Highlights (in thousands) | Metric | Sep 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Cash and cash equivalents | $12,037 | $22,841 | | Total assets | $1,145,339 | $1,110,840 | | Total long-term debt | $412,531 | $412,070 | | Total equity | $425,409 | $385,548 | [Revenue and Backlog Data](index=6&type=section&id=Revenue%20and%20Backlog%20Data) Third-quarter 2024 revenue was driven by strong performance in the Capital - U.S. and Coastal protection segments, which saw significant year-over-year increases, and the total dredging backlog reached a record **$1.21 billion** as of September 30, 2024, up from **$1.04 billion** at the end of 2023, with Capital - U.S. and Coastal protection backlogs showing substantial growth Revenues by Segment (in thousands) | Segment | Three Months Ended Sep 30, 2024 | Three Months Ended Sep 30, 2023 | | :--- | :--- | :--- | | Capital - U.S. | $108,682 | $54,602 | | Coastal protection | $43,913 | $23,567 | | Maintenance | $37,867 | $33,816 | | Rivers & lakes | $711 | $5,200 | | **Total revenues** | **$191,173** | **$117,185** | Backlog by Segment (in thousands) | Segment | Sep 30, 2024 | Dec 31, 2023 | | :--- | :--- | :--- | | Capital - U.S. | $898,898 | $741,839 | | Coastal protection | $218,321 | $138,394 | | Maintenance | $89,050 | $152,104 | | Rivers & lakes | $6,870 | $6,765 | | **Total Dredging Backlog** | **$1,213,139** | **$1,039,102** | [Other Information](index=3&type=section&id=Other%20Information) This section provides details on the upcoming conference call, defines non-GAAP financial measures, offers a brief company overview, and includes a cautionary note regarding forward-looking statements and associated risks [Conference Call Information](index=3&type=section&id=Conference%20Call%20Information) The company will host a conference call on Tuesday, November 5, 2024, at 9:00 a.m. C.S.T. to discuss the quarterly results, with details for pre-registration and accessing the live call and replay provided - A conference call is scheduled for Tuesday, November 5, 2024, at 9:00 a.m. C.S.T (10:00 a.m. E.S.T.)[17](index=17&type=chunk) [Use of Non-GAAP Measures](index=3&type=section&id=Use%20of%20Non-GAAP%20measures) This section defines Adjusted EBITDA, a non-GAAP measure used by the company, calculated by adjusting net income for net interest expense, taxes, depreciation, amortization, and other specific items, which the company believes helps stakeholders evaluate operating trends and period-to-period performance - Adjusted EBITDA is defined as net income (loss) adjusted for net interest expense, income taxes, depreciation and amortization, and other specified items[19](index=19&type=chunk) [Company Overview](index=4&type=section&id=The%20Company) Great Lakes Dredge & Dock Corporation is the largest provider of dredging services in the United States and is expanding into the offshore wind energy industry, with over 134 years of history and operating the largest and most diverse fleet in the U.S. dredging industry, comprising approximately 200 specialized vessels - Great Lakes is the largest provider of dredging services in the U.S. and is expanding into the offshore wind energy sector[21](index=21&type=chunk) [Cautionary Note Regarding Forward-Looking Statements](index=4&type=section&id=Cautionary%20Note%20Regarding%20Forward-Looking%20Statements) This section contains a standard safe harbor statement, warning that forward-looking statements in the press release are subject to various risks and uncertainties, listing numerous factors that could cause actual results to differ materially from expectations, such as government funding, project delays, and costs associated with new vessel construction - The press release contains forward-looking statements that are not guarantees of future performance and are subject to risks and uncertainties[22](index=22&type=chunk) - Key risks include reduction in government funding, cost over-runs, timing of contracts, and unforeseen delays and costs related to the construction of new vessels[22](index=22&type=chunk)[23](index=23&type=chunk)

HOUSTON, Oct. 29, 2024 (GLOBE NEWSWIRE) -- Great Lakes Dredge & Dock Corporation (NASDAQ: GLDD) today announced that it will release the financial results for its three and nine months ended September 30, 2024 on Tuesday, November 5, 2024 at 7:00 a.m. C.S.T. A conference call with the Company will be held the same day at 9:00 a.m. C.S.T. Investors and analysts are encouraged to pre-register for the conference call by using the link below. Participants who pre-register will be given a unique PIN to gain imme ...

Great Lakes Dredge & Dock (GLDD) closed at $11.52 in the latest trading session, marking a -1.62% move from the prior day. The stock trailed the S&P 500, which registered a daily gain of 0.27%. On the other hand, the Dow registered a gain of 0.65%, and the technology-centric Nasdaq increased by 0.26%. Coming into today, shares of the provider of dredging and dock-contracting services had gained 11.84% in the past month. In that same time, the Construction sector lost 2.03%, while the S&P 500 gained 2%. The ...

Great Lakes Dredge & Dock Corporation (GLDD) is benefiting from its focus on the new build program and the ongoing demand strength for dredging services. The consistent award wins reflect the favorable market trends and the strategic initiatives undertaken by the company. Other industry players that share space with GLDD, including EMCOR Group, Inc. (EME) , Granite Construction Incorporated (GVA) and MasTec, Inc. (MTZ) , are also benefiting from the favorable market trends and solid demand for public constr ...

Company Performance - Great Lakes Dredge & Dock (GLDD) closed at $11.62, reflecting a -0.09% change from the previous session, underperforming the S&P 500's gain of 0.71% [1] - Over the past month, GLDD shares have increased by 23.85%, surpassing the Construction sector's gain of 8.51% and the S&P 500's gain of 6.41% [1] Earnings Projections - The upcoming EPS for GLDD is projected at $0.18, indicating a 300% increase compared to the same quarter of the previous year [2] - Revenue is forecasted to be $180.8 million, representing a 54.28% growth compared to the corresponding quarter of the prior year [2] Fiscal Year Estimates - For the entire fiscal year, earnings are projected at $0.80 per share, reflecting a +471.43% change from the prior year [3] - Revenue for the fiscal year is estimated at $749.53 million, indicating a +27.12% change from the previous year [3] Analyst Estimates - Changes in analyst estimates for GLDD are crucial as they reflect near-term business trends, with positive revisions indicating a favorable business outlook [4] - The Zacks Rank system, which incorporates estimate changes, currently ranks GLDD at 3 (Hold) [6] Valuation Metrics - GLDD has a Forward P/E ratio of 14.54, which is below the industry average of 22.04, suggesting it is trading at a discount [7] - The company has a PEG ratio of 0.42, significantly lower than the industry average PEG ratio of 2.19 [8] Industry Context - The Building Products - Heavy Construction industry, which includes GLDD, holds a Zacks Industry Rank of 159, placing it in the bottom 37% of over 250 industries [9] - Research indicates that the top 50% rated industries outperform the bottom half by a factor of 2 to 1 [9]