Financial Data and Key Metrics Changes - Revenue for Q3 2024 was $173 million, down from $312 million in the same period in 2023, primarily due to legacy headwinds and impacts from hurricanes [26][28] - Gross loss for the quarter was $51 million, compared to a gross profit of $30 million in Q3 2023, resulting in a gross profit margin of negative 30% [28][31] - Net loss reported was $55 million or negative $1.14 per share, compared to net income of $4 million or $0.08 per share in the same period last year [31] - EBITDA for the quarter was negative $59 million, compared to positive $22 million in Q3 2023 [31] Business Line Data and Key Metrics Changes - Civil segment revenues were $56 million, a decrease of $35 million from the same period in 2023, with a gross loss of $18 million [32] - Transportation segment revenues were $117 million, down $104 million from the same period in 2023, with a gross loss of $33 million [33][34] - Unfavorable charges of $27 million from legacy civil projects and $44 million from materials and paving and legacy projects significantly impacted both segments [32][34] Market Data and Key Metrics Changes - The company ended the quarter with a total backlog of $2.74 billion, essentially flat from the previous quarter and up from $2.54 billion at the end of Q3 2023 [15] - Approximately $180 million of remaining M&P backlog and $105 million of non-M&P legacy backlog are expected to be substantially complete by the end of 2025 [10][12] Company Strategy and Development Direction - The company is focusing on securing smaller dollar, shorter duration projects that yield quick cash flow, targeting projects in the $30 million to $150 million range [17][66] - The strategic plan includes a shift away from the M&P business to focus on core markets, with a backlog of $2.5 billion in new core projects [12][66] - The company is experiencing sustained demand across core markets, with infrastructure construction services demand outpacing the supply of qualified contractors [16] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong performance of new core projects, which are expected to return the company to profitability in 2025 [12][22] - The company anticipates significant cash inflows from the resolution of disputes and change orders related to legacy projects, contributing to future cash generation [35][41] - Management acknowledged the challenges faced in Q3 but emphasized the robust pipeline of opportunities and the expectation of a recovery in Q4 and into 2025 [54][60] Other Important Information - The company closed a $160 million senior secured term loan facility, extending debt maturities to 2028 and strengthening the balance sheet [14][35] - The company achieved several operational milestones, including significant safety achievements on projects [23] Q&A Session Summary Question: What is the time frame for the $105 million of non-M&P legacy backlog to burn off? - Management expects it to be substantially complete by the end of 2025, with one project extending into 2026 [37] Question: What was the revenue impact from the non-cash unfavorable adjustments in the quarter? - Approximately $71 million was a decrease in recognized revenue due to cumulative catch-up impacts of percentage completion accounting [38] Question: How does the company plan to allocate resources between smaller quick-turn projects and larger projects? - Management aims for a balance, maximizing resources to ensure the highest returns possible [39][40] Question: What is the expected timing of additional claims settlements? - Significant cash flows are expected from settlements as owners are running out of abilities to delay payments [41] Question: Can you provide history on the non-M&P legacy business? - The majority of the work performed well, but legacy projects overshadowed results due to cumulative catch-up effects [44] Question: What is the capacity to add more business given the current backlog? - The company is extremely selective, focusing on projects that maximize returns, with a strong cash position to support this [46][48] Question: How should backlog conversion be expected in Q4? - A recovery in volume is anticipated in Q4, with expectations of a sequential recovery in top line numbers [60][61] Question: How should the cadence of the $180 million M&P revenue be modeled? - A straight line model is not recommended; there will be variability in project completions [62] Question: What risk mitigation processes are being implemented for shorter duration projects? - The company has overhauled its procurement process to cover risk points effectively [68][69]

Financial Performance - Revenue for the three months ended September 30, 2024, was $173,320, a decrease of 44.6% compared to $312,472 for the same period in 2023[11] - Gross loss for the three months ended September 30, 2024, was $(51,105), compared to a gross profit of $29,529 for the same period in 2023[11] - Operating loss for the three months ended September 30, 2024, was $(68,597), compared to an operating income of $14,282 for the same period in 2023[11] - Net loss attributable to Southland Stockholders for the three months ended September 30, 2024, was $(54,727), compared to a net income of $3,800 for the same period in 2023[11] - Comprehensive loss attributable to Southland Stockholders for the three months ended September 30, 2024, was $(54,581), compared to a comprehensive income of $2,173 for the same period in 2023[13] - The company reported a net loss of $(58,129) for the three months ended September 30, 2024, compared to a net income of $4,791 for the same period in 2023[12] - For the nine months ended September 30, 2024, the net loss was $102,959,000 compared to a net loss of $11,376,000 for the same period in 2023[20] - Revenue for the nine months ended September 30, 2024, was $712.9 million, a decrease of $131.3 million, or 15.6%, compared to the same period in 2023[155] - Gross loss for the nine months ended September 30, 2024, was $70.7 million, an increase of $85.4 million, or 581.7%, compared to the same period in 2023[157] - The basic and diluted net loss per share for the three months ended September 30, 2024, was $(1.14), compared to $0.08 for the same period in 2023[129] Cash Flow and Liquidity - Cash flows from operating activities provided $12,242,000 in the nine months ended September 30, 2024, a significant improvement from cash used of $36,588,000 in the prior year[20] - The company’s cash and cash equivalents at the end of the period totaled $106,748,000, an increase from $46,752,000 at the end of September 30, 2023[20] - Cash provided by financing activities was $28,437,000 for the nine months ended September 30, 2024, compared to $11,730,000 in the same period of 2023[20] - The company had a net change in cash, cash equivalents, and restricted cash of $42.9 million for the nine months ended September 30, 2024, compared to a decrease of $25.2 million in the same period of 2023[193] - The company expects to maintain liquidity of at least $20.0 million at all times as per the Credit Agreement[204] Debt and Interest - Total equity as of September 30, 2024, was $158,034, a decrease from $260,564 as of December 31, 2023[15] - Interest expense for the three months ended September 30, 2024, was $(7,520), compared to $(6,231) for the same period in 2023[11] - Interest expense for the nine months ended September 30, 2024, was $19.9 million, an increase of $6.1 million, or 44.3%, compared to the same period in 2023[161] - As of September 30, 2024, total long-term debt was $275.2 million, an increase from $251.9 million as of December 31, 2023[75] - The weighted average interest rate on total debt outstanding increased to 9.22% as of September 30, 2024, from 6.12% as of December 31, 2023[75] - The company entered into a $160.0 million term loan facility on September 30, 2024, which replaced the previous revolving credit facility[77] Operational Changes and Strategy - The company decided to discontinue certain types of projects in its Materials & Paving business line to focus on more profitable areas[24] - The merger with Legato Merger Corp. II was completed on February 14, 2023, with Southland LLC surviving as a wholly owned subsidiary[26] - The company continues to identify new opportunities for growth in both the Civil and Transportation segments, with a positive outlook for future infrastructure projects[136] Segment Performance - The Civil segment generated revenue of $55.8 million, accounting for 32.2% of total revenue, while the Transportation segment contributed $117.5 million, representing 67.8%[73] - Revenue for the Civil segment for the three months ended September 30, 2024, was $55.8 million, a decrease of $34.9 million, or 38.4%, compared to the same period in 2023[164] - Revenue for the Transportation segment for the three months ended September 30, 2024, was $117.5 million, a decrease of $104.3 million, or 47.0%, compared to the same period in 2023[168] Assets and Liabilities - As of September 30, 2024, the company had $20.2 million in accrued loss provisions, up from $17.3 million as of December 31, 2023[64] - As of September 30, 2024, contract assets totaled $456.2 million, down from $554.2 million as of December 31, 2023, representing a decrease of 17.7%[109] - The net contract position as of September 30, 2024, was $212.7 million, down from $360.9 million as of December 31, 2023, indicating a reduction of 41.0%[111] - The company recorded claims assets of $253.0 million as of September 30, 2024, compared to $306.4 million as of December 31, 2023, a decrease of 17.5%[113] Future Outlook - The company plans to adopt ASU 2023-05 in the first quarter of 2025, which is expected to have no material impact on consolidated financial statements[43] - The company anticipates that future operating results and available cash will be adequate to meet liquidity needs for at least the next twelve months[190]

Financial Performance - Revenue for the quarter ended September 30, 2024, was $173.3 million, a decrease of $139.2 million, or 44.5%, compared to the same quarter in 2023[5] - Gross loss for the quarter ended September 30, 2024, was $51.1 million, compared to a gross profit of $29.5 million for the same quarter in 2023, resulting in a gross margin decrease from 9.5% to (29.5)%[6] - Net loss attributable to stockholders for the quarter ended September 30, 2024, was $54.7 million, or $(1.14) per share, compared to a net income of $3.8 million, or $0.08 per share for the same quarter in 2023[2] - EBITDA for the quarter ended September 30, 2024, was $(58.7) million, compared to $22.3 million for the same quarter in 2023[3] - For the nine months ended September 30, 2024, revenue was $712.9 million, a decrease of $131.3 million, or 15.6%, compared to the same period in 2023[8] - Gross loss for the nine months ended September 30, 2024, was $70.7 million, compared to a gross profit of $14.7 million for the same period in 2023, with a gross margin decrease from 1.7% to (9.9)%[9] - The company reported a net loss of $102,959,000 for the nine months ended September 30, 2024, compared to a net loss of $11,376,000 for the same period in 2023[20] - Adjusted net loss attributable to common stockholders was $54,727,000 for the three months ended September 30, 2024, compared to an adjusted net income of $3,800,000 for the same period in 2023[17] Assets and Liabilities - Total assets decreased to $1,186,794,000 as of September 30, 2024, from $1,201,068,000 as of December 31, 2023[19] - Cash and cash equivalents increased to $91,378,000 as of September 30, 2024, from $49,176,000 as of December 31, 2023[19] - Total liabilities increased to $430,564,000 as of September 30, 2024, compared to $356,537,000 as of December 31, 2023[19] - The company reported a total stockholders' equity of $149,064,000 as of September 30, 2024, down from $249,622,000 as of December 31, 2023[19] - The company had borrowings on notes payable of $167,784,000 for the nine months ended September 30, 2024, compared to $115,355,000 for the same period in 2023[20] Cash Flow and Expenses - Cash flows from operating activities showed a net cash used of $36,588,000 for the nine months ended September 30, 2024[20] - Selling, general, and administrative expenses for the quarter ended September 30, 2024, were $17.5 million, an increase of $2.2 million, or 14.7%, compared to the same quarter in 2023[7] - Southland's cash paid for interest increased to $18,886 from $12,704, representing a 48.5% increase year-over-year[21] Business Segments and Operations - Backlog as of September 30, 2024, was $2.74 billion, an increase from $2.54 billion as of September 30, 2023[3] - The Transportation segment accounted for 67.8% of total revenue in the quarter ended September 30, 2024, down from 71.0% in the same quarter of 2023[11] - Materials & Paving business contributed $17.5 million to revenue in the quarter ended September 30, 2024[5] Other Financial Metrics - Lease assets obtained in exchange for new leases rose to $9,881 from $8,529, a growth of 15.8%[21] - Assets obtained in exchange for notes payable surged to $23,286 from $8,626, marking an increase of 169.8%[21] - Related party payable exchanged for notes payable amounted to $3,797, with no previous year comparison available[21] - The issuance of post-merger earnout shares was recorded at $0, compared to $35,000 in the previous year[21] - Dividend financed with notes payable was $0, down from $50,000 in the prior year[21] Company Overview - Southland is a leading provider of specialized infrastructure construction services, with a history dating back to 1900[23] - The company serves various end markets including bridges, tunneling, and water treatment[23] - Southland's financial measures include non-GAAP metrics such as Adjusted EBITDA, which provide insights into financial trends[25] - Forward-looking statements indicate that actual results may differ materially from projections due to inherent uncertainties[27]

Financial Data and Key Metrics - Revenue for Q2 2024 was $252 million, down from $257 million in Q2 2023 [4] - Gross loss for Q2 2024 was $40 million, compared to $34 million in Q2 2023 [4] - Operating cash flow was strong at $27 million in Q2 2024 [4] - Net loss for Q2 2024 was $46 million, or $0.96 per share, compared to a net loss of $13 million, or $0.27 per share, in Q2 2023 [16] - Adjusted EBITDA for Q2 2024 was negative $49.9 million, compared to negative $42.2 million in Q2 2023 [17] Business Line Performance - Civil segment revenue increased to $79 million in Q2 2024, up from $65 million in Q2 2023, with gross profit margin improving to 12% from 9% [18] - Transportation segment revenue decreased to $172 million in Q2 2024, down from $191 million in Q2 2023, with gross profit margin worsening to negative 29% from negative 21% [18] - Materials & Paving segment contributed $9 million in revenue but had a gross loss of $47 million due to unfavorable adjustments from dispute settlements [19] Market and Backlog Data - Backlog at the end of Q2 2024 was $2.74 billion, up from $2.64 billion in Q1 2024 [8] - New awards in Q2 2024 totaled $375 million, including the $202 million Bull Run Filtration Facility and $150 million in water resource projects [8] - The company was selected for phase 2 of the North End Treatment Plant in Winnipeg, with an expected construction contract value of $220 million [9] Strategic Direction and Industry Competition - The company is focusing on resolving legacy disputes to strengthen the balance sheet and generate cash [5][6] - Alternative delivery contracts, such as progressive design builds, are becoming more prevalent, and the company is well-positioned to capitalize on these opportunities due to its technical expertise and competitive advantage [10][11] - The EPA's updated Clean Water Infrastructure Needs survey estimates $630 billion will be needed over the next 20 years to address water quality objectives, presenting significant opportunities for the company [11][12] Management Commentary on Operating Environment and Future Outlook - Management expressed confidence in the core business and the ability to capitalize on opportunities from the IIJA (Infrastructure Investment and Jobs Act) [13][14] - The company expects to generate significant cash from resolving legacy disputes and strong performance in core business projects in the coming quarters [6][14] Other Important Information - The company closed a $42.5 million real estate transaction in July 2024, resulting in $16 million of debt reduction and $25 million in cash for general corporate purposes [7] - A debt refinancing transaction is expected to be finalized before Q3 2024 results are announced, which will refinance approximately $110 million of existing debt [21] Q&A Session Summary Question: When will the Civil segment backlog start flowing into revenue? - Revenue from the Civil segment is expected to increase in Q3 and Q4 2024, with backlog up 38% year-over-year [23][24] Question: How will the remaining Materials & Paving backlog be recognized? - The remaining $200 million in Materials & Paving backlog will be heavily weighted towards Q3 and Q4 2024, with some projects trailing into 2025 [25] Question: What is the potential for more dispute settlements in the coming quarters? - The company expects to generate significant cash from ongoing dispute settlements, with approximately half of the CIE balance related to substantially completed projects [27] Question: How many projects are involved in the disputed contracts? - The company has a handful of claims related to its legacy portfolio, with the CityLYNX project being one of the larger claims [29][30] Question: What is the outlook for organic growth excluding legacy disputes? - The company expects strong organic growth driven by the IIJA and healthy market conditions, with the Civil segment backlog up 38% [33][34] Question: What are the chances of contract disputes being settled in 2025 instead of 2024? - Most claims are from projects bid in 2018 and 2019, and the company is working to resolve them as quickly as possible [37] Question: Why was the revenue from Materials & Paving only $9 million in Q2 2024? - The settlement resulted in a derecognition of revenue from prior periods, but operational progress remains on track for substantial completion by mid-2025 [38] Question: How will the $110 million refinancing affect GAAP interest expense? - The refinancing is expected to support working capital better, but details will be provided once the transaction is finalized [40] Question: Did weather impact Q2 or early Q3 performance? - Higher-than-normal rain events impacted some work, but no significant weather-related issues were noted for July [41] Question: What is the pro forma balance sheet position after recent transactions? - The real estate transaction and dispute settlements have strengthened the balance sheet, with $25 million in net proceeds and $16 million in debt reduction [43] Question: What are the remaining risks in executing the Materials & Paving backlog? - Risks include change orders, weather, and inflation, but the company expects to collect on recorded claims and sees potential cash upside [45][47]

Financial Performance - Revenue for the three months ended June 30, 2024, was $251,512,000, a decrease of 2% from $256,927,000 for the same period in 2023[11] - Gross loss for the three months ended June 30, 2024, was $(40,022,000), compared to $(33,794,000) for the same period in 2023, indicating a deterioration in gross margin[11] - Operating loss for the three months ended June 30, 2024, was $(55,702,000), an increase from $(50,242,000) in the prior year[11] - Net loss attributable to Southland Stockholders for the three months ended June 30, 2024, was $(46,077,000), compared to $(12,826,000) for the same period in 2023[11] - Net loss per share attributable to common stockholders for the three months ended June 30, 2024, was $(0.96), compared to $(0.27) in the same period of 2023[11] - Comprehensive loss attributable to Southland Stockholders for the three months ended June 30, 2024, was $(46,667,000), compared to $(11,678,000) for the same period in 2023[12] - The company reported a net loss before income taxes of $(61,316,000) for the three months ended June 30, 2024, compared to $(30,490,000) for the same period in 2023[11] - The net loss for the six months ended June 30, 2024, was $44,830,000, compared to a net loss of $16,167,000 for the same period in 2023[17] - Revenue for the six months ended June 30, 2024, was $539.6 million, an increase of $7.9 million, or 1.5%, compared to $531.8 million for the same period in 2023[122] - Gross loss for the six months ended June 30, 2024, was $19.6 million, an increase of $4.8 million, or 32.0%, compared to a gross loss of $14.9 million for the same period in 2023[124] Cash Flow and Liquidity - Cash flows from operating activities provided $17,534,000 in the first half of 2024, a significant improvement from a cash outflow of $10,636,000 in the first half of 2023[17] - Cash and cash equivalents at the end of the period increased to $69,169,000 from $54,108,000 year-over-year[17] - The total cash, cash equivalents, and restricted cash at the end of the period was $69,169,000, up from $63,820,000 at the beginning of the period[28] - Net cash provided by operating activities was $17.5 million during the six months ended June 30, 2024, compared to a net cash used of $10.6 million in the same period in 2023[159] - Net cash used in financing activities was $15.1 million for the six months ended June 30, 2024, compared to $9.7 million for the same period in 2023[162] Debt and Financing - Total long-term debt as of June 30, 2024, was $173,239 thousand, an increase from $251,906 thousand as of December 31, 2023[58] - The weighted average interest rate on total debt increased to 7.01% as of June 30, 2024, from 6.12% as of December 31, 2023[58] - The company amended its revolving credit facility to extend maturity to April 15, 2025, with a current drawn amount of $90,000 thousand[60] - The company projects compliance with all applicable debt covenants through the maturity of the revolving credit facility[59] - Total long-term debt as of June 30, 2024, was $307.8 million, with $134.5 million due within the next twelve months[163] - The revolving credit facility limit was amended to $95.0 million in May 2024, with $90.0 million drawn as of June 30, 2024[164] Segment Performance - Civil segment revenue increased to $79,368 thousand (31.6% of total revenue) in Q2 2024, compared to $65,567 thousand (25.5%) in Q2 2023[56] - Transportation segment revenue decreased to $172,144 thousand (68.4% of total revenue) in Q2 2024, down from $191,360 thousand (74.5%) in Q2 2023[56] - Revenue for the Civil segment for the three months ended June 30, 2024, was $79.4 million, an increase of $13.8 million, or 21.0%, compared to $65.6 million for the same period in 2023[130] - Revenue for the Transportation segment for the three months ended June 30, 2024, was $172.1 million, a decrease of $19.2 million, or 10.0%, compared to $191.4 million for the same period in 2023[135] Operational Adjustments - The company discontinued certain projects in its Materials & Paving business line to focus on more profitable areas, although this did not qualify for Discontinued Operations treatment[21] - The company reported a gain on the sale of assets amounting to $2,855,000 in the first half of 2024, compared to a gain of $85,000 in the same period of 2023[17] - The company entered into a real estate purchase agreement to sell three properties for a total of $42.5 million, with proceeds allocated for general corporate purposes and debt reduction[97][98] Accounting and Regulatory Changes - The company plans to adopt ASU 2023-05 regarding joint venture formations in the first quarter of 2025, expecting no material impact on consolidated financial statements[33] - The Company is evaluating the impact of ASU 2023-07 and ASU 2023-09 on its consolidated financial statements, with ASU 2023-07 effective for annual periods beginning after January 1, 2024[35][36] - The Company has not elected to early adopt ASU 2023-09, which establishes new income tax disclosure requirements effective for annual periods beginning after December 15, 2024[36] - The Company’s significant accounting policies remained unchanged for the three and six months ended June 30, 2024[37] Backlog and Future Expectations - As of June 30, 2024, Southland had $2.7 billion of Remaining Unsatisfied Performance Obligations (RUPO), expecting to recognize approximately 39% as revenue in the next twelve months[81] - Backlog as of June 30, 2024, was $2,743.7 million, down from $2,834.9 million at the end of 2023[151] - The company anticipates further spending on infrastructure projects due to economic stimulus initiatives, including the Infrastructure Investment and Jobs Act[106]

Financial Performance - Revenue for Q2 2024 was $251.5 million, a decrease of $5.4 million, or 2.1%, compared to Q2 2023 revenue of $256.9 million[1][6] - Gross loss for Q2 2024 was $40.0 million, an increase of $6.2 million, or 18.4%, compared to a gross loss of $33.8 million in Q2 2023[1][6] - Net loss attributable to stockholders for Q2 2024 was $46.1 million, or $(0.96) per share, compared to a net loss of $12.8 million, or $(0.27) per share in Q2 2023[1][2] - Adjusted EBITDA for Q2 2024 was $(49.9) million, compared to $(42.2) million in Q2 2023[2] - Net loss attributable to Southland Stockholders for the three months ended June 30, 2024, was $(46,077) thousand, compared to $(12,826) thousand for the same period in 2023, representing a significant increase in losses[14] - Adjusted EBITDA for the six months ended June 30, 2024, was $(38,973) thousand, compared to $(29,424) thousand for the same period in 2023, indicating a worsening operational performance[14] - Net loss for the six months ended June 30, 2024, was $44,830,000, compared to a net loss of $16,167,000 for the same period in 2023[1] Operational Efficiency - Positive cash flow from operations for Q2 2024 was $27.4 million, reflecting improved operational efficiency[2][4] - Cash provided by operating activities was $17,534,000, a significant improvement from cash used in operating activities of $(10,636,000) in the prior year[1] Backlog and Awards - New awards totaled $374.8 million in Q2 2024, contributing to a backlog of $2.74 billion, up from $2.64 billion as of March 31, 2024[2] - The balance of backlog as of June 30, 2024, was $2,743,749 thousand, down from $2,834,966 thousand at the end of 2023, suggesting a decrease in future revenue visibility[15] - The company recognized contract revenue of $(566,872) thousand in 2024, which reduced the backlog balance[15] Assets and Liabilities - Total assets as of June 30, 2024, increased to $1,263,407 thousand from $1,201,068 thousand as of December 31, 2023, reflecting growth in the company's asset base[17] - Current liabilities rose to $770,242 thousand as of June 30, 2024, compared to $583,967 thousand at the end of 2023, indicating increased short-term financial obligations[17] - Total liabilities increased to $1,047,857 thousand as of June 30, 2024, from $940,504 thousand at the end of 2023, indicating a rise in the company's debt levels[17] Cash and Liquidity - Cash and cash equivalents increased to $52,352 thousand as of June 30, 2024, from $49,176 thousand at the end of 2023, indicating improved liquidity[17] - Total cash and cash equivalents at the end of the period increased to $69,169,000 from $54,108,000 year-over-year[1] - Cash paid for income taxes was $203,000, down from $2,903,000 in the previous year[1] - Cash paid for interest increased to $11,970,000 from $7,541,000 year-over-year[1] - Net cash provided by investing activities was $2,982,000, compared to $2,240,000 in the same period last year[1] - Borrowings on notes payable increased significantly to $24,678,000 from $248,000 in the previous year[1] Segment Performance - The Civil segment generated $79.4 million in revenue for Q2 2024, representing 31.6% of total revenue, while the Transportation segment accounted for $172.1 million, or 68.4%[11] - The Materials & Paving business negatively impacted gross loss by $46.8 million in Q2 2024[6][8] Future Outlook - The company expects to collect approximately $58 million from settled contract disputes in Q3 2024, which will enhance liquidity[3][4] - The company plans to host a conference call on August 13, 2024, to discuss financial results and future outlook[22] Company Overview - Southland is a leading provider of specialized infrastructure construction services, with a focus on various sectors including transportation and water treatment[23]

Financial Data and Key Metrics Changes - Revenue for Q1 2024 was $288 million, an increase of 5% from the same quarter last year [7][22] - Gross profit was $20 million, up from $19 million in the prior year, with a gross profit margin of 7.1%, slightly up from 6.9% [7][22] - EBITDA for the quarter was $11 million, compared to $9 million for the same period in 2023 [19] - The company reported a net loss of $400,000 or negative $0.01 per share, an improvement from a net loss of $5 million or negative $0.11 per share in the same period last year [23] Business Line Data and Key Metrics Changes - Civil segment revenue was $84 million, an increase of $11 million from the same period in 2023, with a gross profit of $18 million and a gross profit margin of 21%, up from 12% [24] - Transportation segment revenue was $204 million, an increase of $2 million from the same period in 2023, but gross profit decreased to $3 million from $10 million, resulting in a gross profit margin of 1%, down from 5% [24][25] - The materials and paving business line contributed $38 million to revenue but had a negative gross profit of $10 million due to severe weather and increased project costs [25] Market Data and Key Metrics Changes - The company ended the quarter with a backlog of $2.64 billion, having booked approximately $100 million in new awards during the quarter [11] - Demand from public agencies and private clients remains strong, with expectations for continued proposal submissions for various projects [12][15] Company Strategy and Development Direction - The company aims to capitalize on opportunities in the U.S. and core end markets, with a focus on civil projects and infrastructure improvements [13][16] - There is a strategic emphasis on selecting high-margin projects and managing the backlog effectively, particularly as legacy projects are completed [44][49] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the strong demand in end markets and the potential for new awards as the year progresses [16][44] - The company expects to see a sequential increase in backlog due to strong new awards and is focused on maintaining healthy margins [49] Other Important Information - The company has a net debt of $255 million, with plans to pay down approximately $46 million of debt in the next 12 months [26] - The company is evaluating options to simplify its debt structure and extend maturities [26] Q&A Session Summary Question: Continued M&P losses and potential offsets - Management indicated that new jobs starting should help offset losses, with a focus on completing legacy work by mid-2025 [29][30] Question: Outlook for Civil segment margins - Management is optimistic about maintaining healthy margins in the Civil segment due to strong project execution and new awards [33] Question: End market mix within Civil - The Civil segment is seeing diverse opportunities across water, wastewater, and emergency projects, contributing to strong execution [37] Question: Impact of legacy projects on gross margins - Management expects a decline in legacy backlog impact on gross margins as new work contributes positively [46] Question: Cash flow expectations - Positive cash flows are anticipated in the latter half of the year, consistent with historical trends [48]

Financial Performance - Revenue for Q1 2024 was $288,097,000, an increase of 4.6% compared to $274,829,000 in Q1 2023[18] - Gross profit for Q1 2024 was $20,421,000, up from $18,943,000 in Q1 2023, reflecting a gross margin improvement[18] - Operating income increased to $6,027,000 in Q1 2024 from $3,372,000 in Q1 2023, representing a significant growth[18] - Net income for Q1 2024 was $525,000, a turnaround from a net loss of $4,266,000 in Q1 2023[18] - For the three months ended March 31, 2024, gross profit was $20,421,000, representing a 7.1% margin, compared to $18,943,000 and a 6.9% margin for the same period in 2023[74] - Net income for the three months ended March 31, 2024, was $525,000, a significant improvement from a net loss of $4,266,000 in the same period of 2023[25] - Net income attributable to Southland Stockholders for the three months ended March 31, 2024, was a loss of $406,000, an improvement from a loss of $4.7 million in the same period in 2023[144] Assets and Liabilities - Total assets as of March 31, 2024, were $1,227,416,000, compared to $1,201,068,000 as of December 31, 2023[15] - Total liabilities increased to $966,437,000 as of March 31, 2024, from $940,504,000 at the end of 2023[15] - Total stockholders' equity as of March 31, 2024, was $260,979,000, slightly up from $260,564,000 at the end of 2023[15] - Total long-term debt as of March 31, 2024, was $255,590,000, an increase from $251,906,000 as of December 31, 2023[75] Cash Flow and Operational Efficiency - Cash flows used in operating activities decreased to $9,897,000 for the three months ended March 31, 2024, compared to $34,779,000 in the prior year, indicating improved operational efficiency[25] - Net cash used in operating activities was $9.9 million for the three months ended March 31, 2024, compared to $34.8 million for the same period in 2023, indicating a significant improvement[153] - The primary drivers for cash used in operating activities included increases in accounts receivables and contract assets of $32.1 million and $16.2 million, respectively, offset by an increase in accounts payable of $40.0 million[153] Revenue Segmentation - Civil segment revenue was $84.3 million, accounting for 29.3% of total revenue, compared to $73.0 million (26.6%) in the prior year[73] - Transportation segment revenue was $203.8 million, representing 70.7% of total revenue, slightly up from $201.8 million (73.4%) year-over-year[73] - Revenue from the Materials & Paving segment for the three months ended March 31, 2024, was $38.6 million, down from $58.1 million in the same period of 2023, reflecting a decline of approximately 33.8%[125] Debt and Financing - The weighted average interest rate on total debt outstanding increased to 6.21% as of March 31, 2024, from 6.12% as of December 31, 2023[75] - The company amended its revolving credit facility to extend maturity to April 15, 2025, with $95,000,000 drawn as of March 31, 2024[78] - The revolving credit facility was amended to a limit of $95.0 million, requiring a $5.0 million cash collateral deposit by June 15, 2024[157] - In July 2023, the company refinanced approximately $76.4 million of existing secured notes for a new equipment note of $113.5 million at a fixed rate of 7.25%[158] Other Financial Metrics - The effective tax rate for the three months ended March 31, 2024, was 36.9%, compared to a negative 69.8% for the same period in 2023[90][91] - The company incurred a loss on extinguishment of debt of $600,000 related to the refinancing of secured notes[79] - Adjusted EBITDA for the three months ended March 31, 2024, was $10.9 million, a decrease from $12.7 million in the same period in 2023[144] Backlog and Future Expectations - Backlog as of March 31, 2024, was $2.6 billion, down from $2.8 billion at the end of 2023, after accounting for new contracts and revenue recognized[146] - The company expects to recognize approximately 42% of its Remaining Unsatisfied Performance Obligations (RUPOs) as revenue during the next twelve months[95] - Approximately 7.7% of Southland's backlog as of March 31, 2024, was in the Materials & Paving segment, which is expected to be substantially completed in the next 15 months[125]

Southland Announces First Quarter 2024 Results GRAPEVINE, Texas, May 13, 2024 (Business Newswire) -- Southland Holdings, Inc. (NYSE American: SLND and SLND WS) ("Southland"), a leading provider of specialized infrastructure construction services, today announced financial results for the quarter ended March 31, 2024. Southland's President and Chief Executive Officer, Frank Renda, said, "We had a good start to the year in our seasonally slowest quarter, with revenue increasing by 5% and gross margins improvi ...

Southland Holdings, Inc. (NYSE:SLND) Q4 2023 Earnings Conference Call March 5, 2024 10:00 AM ET Company Participants Alex Murray - Director, Corporate Development & IR Frank Renda - President & CEO Cody Gallarda - EVP & CFO Conference Call Participants Adam Thalhimer - Thompson Davis Christian Schwab - Craig-Hallum Capital Group Jean Ramirez - D.A. Davidson Alex Hantman - Sidoti & Company Operator Good morning. My name is Joanna and I will be your conference operator today. At this time, I would like to wel ...