Southland (SLND) - 2025 Q1 - Quarterly Results

Southland First Quarter 2025 Results Southland announces its first quarter 2025 results, highlighting mixed performance with improved margins and positive cash flow First Quarter 2025 Highlights Southland began 2025 with mixed results, achieving improved gross profit margins and positive operating cash flow despite a revenue decrease, reporting a net loss but maintaining a strong $2.47 billion backlog - CEO Frank Renda highlighted a strong start to 2025, with improved margins and positive operating cash flow, expressing confidence in driving long-term value due to strong market demand and a robust project pipeline[3] Q1 2025 vs Q1 2024 Key Financial Metrics | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | Revenue | $239.5 million | $288.1 million | | Gross Profit | $21.5 million | $20.4 million | | Gross Profit Margin | 9.0% | 7.1% | | Net Loss Attributable to Stockholders | $(4.6) million | $(0.4) million | | EBITDA | $10.1 million | $10.9 million | | Backlog | $2.47 billion | N/A | 2025 First Quarter Financial Results Q1 2025 saw revenue decline to $239.5 million, but gross profit improved to $21.5 million, while increased expenses led to a $4.6 million net loss, offset by positive operating cash flow Condensed Consolidated Statements of Operations Q1 2025 revenue decreased by 16.9% to $239.5 million, while gross profit increased to $21.5 million with a 9.0% margin, but higher SG&A and interest expenses led to a $4.6 million net loss Condensed Consolidated Statements of Operations (in thousands) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Revenue | $239,486 | $288,097 | | Gross profit | $21,480 | $20,421 | | Operating income | $5,015 | $6,027 | | Net loss attributable to Southland Stockholders | $(4,552) | $(406) | | Net loss per share (Basic & Diluted) | $(0.08) | $(0.01) | - Revenue for Q1 2025 decreased by $48.6 million, or 16.9%, compared to Q1 2024[6] - Gross margin increased to 9.0% in Q1 2025 from 7.1% in Q1 2024. The Materials & Paving business had a negative impact of $9.1 million on gross profit[7] - Selling, general, and administrative (SG&A) costs increased by 14.4% to $16.5 million, representing 6.9% of revenue compared to 5.0% in the prior year[8] Condensed Consolidated Balance Sheets As of March 31, 2025, total assets were $1.203 billion, total liabilities $1.030 billion, and equity $172.7 million, with cash decreasing to $65.1 million Balance Sheet Summary (in thousands) | | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Total Assets | $1,202,929 | $1,203,649 | | Cash and cash equivalents | $65,052 | $72,185 | | Total current assets | $884,954 | $881,652 | | Total Liabilities | $1,030,271 | $1,028,240 | | Total current liabilities | $638,288 | $621,142 | | Long-term debt | $241,309 | $255,625 | | Total Equity | $172,658 | $175,409 | Condensed Consolidated Statement of Cash Flows Q1 2025 saw $6.4 million cash generated from operations, a significant improvement, while investing provided $1.1 million and financing used $14.0 million, leading to a $6.4 million net cash decrease Cash Flow Summary (in thousands) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $6,429 | $(9,897) | | Net cash provided by (used in) investing activities | $1,117 | $(432) | | Net cash used in financing activities | $(13,989) | $(6,943) | | Net decrease in cash | $(6,445) | $(17,303) | Segment Performance and Backlog Q1 2025 Civil segment revenue rose to $102.9 million with a 22.0% margin, while Transportation revenue fell to $136.6 million with a $1.2 million gross loss, maintaining a strong $2.47 billion total backlog Segment Revenue (in thousands) | Segment | Q1 2025 Revenue | % of Total | Q1 2024 Revenue | % of Total | | :--- | :--- | :--- | :--- | :--- | | Civil | $102,916 | 43.0% | $84,273 | 29.3% | | Transportation | $136,570 | 57.0% | $203,824 | 70.7% | | Total | $239,486 | 100.0% | $288,097 | 100.0% | Segment Gross Profit (Loss) (in thousands) | Segment | Q1 2025 Gross Profit (Loss) | % of Segment Revenue | Q1 2024 Gross Profit | % of Segment Revenue | | :--- | :--- | :--- | :--- | :--- | | Civil | $22,631 | 22.0% | $17,870 | 21.2% | | Transportation | $(1,151) | (0.8)% | $2,551 | 1.3% | | Total | $21,480 | 9.0% | $20,421 | 7.1% | Backlog Reconciliation (in thousands) | | Amount | | :--- | :--- | | Balance December 31, 2024 | $2,572,912 | | New contracts, change orders, and adjustments | $136,542 | | Less: contract revenue recognized in 2025 | $(239,486) | | Balance March 31, 2025 | $2,469,968 | Non-GAAP Financial Measures The company uses non-GAAP measures like EBITDA, which was $10.1 million in Q1 2025, and Backlog to provide additional performance insight, with reconciliation provided EBITDA Reconciliation (in thousands) | | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | Net loss attributable to Southland Stockholders | $(4,552) | $(406) | | Depreciation and amortization | 6,525 | 5,577 | | Income tax expense (benefit) | (313) | 307 | | Interest expense | 8,874 | 5,655 | | Interest income | (450) | (184) | | EBITDA | $10,084 | $10,949 | - The company states that non-GAAP measures like EBITDA and Backlog are used to provide useful information to investors but should not be considered in isolation or as an alternative to GAAP measures[21] Other Information Southland, a leading North American infrastructure construction company, will host a conference call on May 14, 2025, to discuss results, with forward-looking statements subject to risks - A conference call to discuss the results will be held at 10:00 a.m. Eastern Time on Wednesday, May 14, 2025[18] - Southland is a leading provider of specialized infrastructure construction services, with experience in bridges, tunneling, transportation, marine, and water/wastewater treatment[19] - The press release contains forward-looking statements that are based on current beliefs and are subject to inherent risks and uncertainties[23]