Southland (SLND) - 2024 Q2 - Quarterly Report

Financial Performance - Revenue for the three months ended June 30, 2024, was $251,512,000, a decrease of 2$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$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$172,144 thousand (68.4% of total revenue) in Q2 2024, down from $191,360 thousand (74.5$79.4 million, an increase of $13.8 million, or 21.0$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$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]