Matrix Service pany(MTRX) - 2025 Q3 - Quarterly Report

Revenue and Profitability - Revenue increased by $34.1 million, or 21%, to$ 200.2 million for the three months ended March 31, 2025, driven by higher volumes in the Storage and Terminal Solutions and Utility and Power Infrastructure segments [81]. - Gross profit rose by $7.3 million, or 130%, with a gross margin of 6.4% for Q3 fiscal 2025, compared to 3.4% in Q3 fiscal 2024 [82]. - Total revenue for the three months ended March 31, 2025, increased by$ 34.1 million, or 21%, to $200.2 million compared to$ 166.0 million in the same period last year [85]. - Storage and Terminal Solutions revenue rose by $41.8 million, or 77%, driven by increased work volume for specialty vessel and LNG storage projects [86]. - Utility and Power Infrastructure revenue increased by$ 12.6 million, or 27%, primarily due to higher work volume for natural gas peak shaving projects [88]. - Process and Industrial Facilities revenue decreased by $20.2 million, or 31%, attributed to lower revenue volumes from the completion of a large renewable diesel project [90]. - Gross profit for the nine months ended March 31, 2025, increased by$ 3.5 million, or 13%, with a gross margin of 5.7% compared to 5.2% in the same period last year [94]. - Utility and Power Infrastructure gross profit surged by $4.1 million, or 293%, with a gross margin of 9.4% for the three months ended March 31, 2025, compared to 3.1% in the same period last year [89]. - Storage and Terminal Solutions gross profit increased by$ 6.6 million, or 72%, with a gross margin of 5.8% for the nine months ended March 31, 2025, compared to 4.4% in the same period last year [102]. - Total operating loss for the nine months ended March 31, 2025, improved by $2.6 million, or 11%, to$ 22.2 million compared to $24.8 million in the same period last year [93]. - Process and Industrial gross profit decreased by$ 7.4 million, or 55%, for the nine months ended March 31, 2025, with a segment gross margin of 5.7% compared to 6.4% in the same period last year [106]. Project Awards and Backlog - Project awards totaled $301.2 million in the current quarter, resulting in a book-to-bill ratio of 1.5x, indicating strong demand across segments [68]. - Backlog increased to$ 1.41 billion as of March 31, 2025, up from $1.31 billion at the end of the previous quarter [72]. - The Storage and Terminal Solutions segment booked$ 204.8 million in project awards during Q3 fiscal 2025, with significant opportunities in LNG and ammonia projects [76]. - The Utility and Power Infrastructure segment secured $37.7 million in project awards during the same period, with a promising pipeline for LNG peak shaving projects [77]. - The Process and Industrial Facilities segment achieved$ 58.7 million in project awards, including a five-year renewal of a refinery maintenance contract [78]. Cash Flow and Liquidity - Unrestricted cash and cash equivalents totaled $185.5 million as of March 31, 2025, with total liquidity of$ 247.1 million, an increase of $35.4 million during the third quarter of fiscal 2025 [108]. - Cash flows provided by operating activities were$ 76.8 million for the nine months ended March 31, 2025, compared to $25.6 million for the same period last year [115]. - Cash flows used in investing activities were$ 5.2 million for the nine months ended March 31, 2025, primarily for capital expenditures related to a fabrication facility and construction equipment [118]. - Financing activities used $1.1 million of cash in the nine months ended March 31, 2025, mainly for the repurchase of common stock for tax payments on equity-based compensation [120]. Interest Income and Expenses - Interest income surged by 820% to$ 1.5 million, reflecting improved cash management strategies [81]. - Interest income increased by $4.2 million, or 879%, primarily due to an increase in cash balance [96]. - Selling, general and administrative expenses increased by$ 0.8 million, or 2%, primarily due to an increase in salaries and wages [95]. Business Strategy and Market Conditions - The company is consolidating certain business aspects to enhance performance and align with market needs, focusing on long-term shareholder value [69]. - There have been no material changes in critical accounting policies and estimates from the fiscal 2024 Annual Report [125]. - The company reported no material changes in market risk compared to the fiscal year ended June 30, 2024 [126]. Shareholder Information - The company has an asset-based credit agreement with a maximum loan amount of $90.0 million under the ABL Facility, which matures on September 9, 2026 [113]. - As of March 31, 2025, the borrowing base under the ABL Facility was$ 66.3 million, with no borrowings outstanding and $4.8 million in letters of credit [114]. - The company has never paid cash dividends on common stock, and future dividend payments will depend on financial conditions and terms of the ABL Facility [122]. - As of March 31, 2025, the company had 281,365 treasury shares, which will be utilized for equity awards and the Employee Stock Purchase Plan [124].