Northwest Pipe(NWPX) - 2025 Q2 - Quarterly Report

PART I - FINANCIAL INFORMATION Item 1. Financial Statements (Unaudited) NWPX Infrastructure, Inc. reports unaudited H1 2025 net sales of $249.3 million and net income of $13.0 million Condensed Consolidated Statements of Operations Q2 2025 net sales rose to $133.2 million with $9.1 million net income; six-month net income decreased to $13.0 million Condensed Consolidated Statements of Operations (in thousands) | Financial Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Net sales | $133,182 | $129,505 | $249,297 | $242,720 | | Gross profit | $25,365 | $25,814 | $44,730 | $45,948 | | Operating income | $13,236 | $13,619 | $18,805 | $22,309 | | Net income | $9,063 | $8,619 | $13,027 | $13,857 | | Diluted EPS | $0.91 | $0.86 | $1.30 | $1.38 | Condensed Consolidated Balance Sheets Total assets reached $592.6 million as of June 30, 2025, with liabilities at $213.1 million and equity at $379.5 million Condensed Consolidated Balance Sheets (in thousands) | Balance Sheet Item | June 30, 2025 (in thousands) | December 31, 2024 (in thousands) | | :--- | :--- | :--- | | Total current assets | $264,002 | $262,488 | | Total assets | $592,580 | $589,653 | | Total current liabilities | $66,797 | $75,133 | | Total liabilities | $213,128 | $215,650 | | Total stockholders' equity | $379,452 | $374,003 | Condensed Consolidated Statements of Cash Flows H1 2025 net cash from operations improved to $10.3 million, with investing and financing activities using $7.1 million and $6.1 million Condensed Consolidated Statements of Cash Flows (in thousands) | Cash Flow Activity (Six Months Ended June 30) | 2025 (in thousands) | 2024 (in thousands) | | :--- | :--- | :--- | | Net cash provided by (used in) operating activities | $10,272 | $(3,815) | | Net cash used in investing activities | $(7,144) | $(10,573) | | Net cash provided by (used in) financing activities | $(6,104) | $14,848 | | Change in cash and cash equivalents | $(2,976) | $460 | | Cash and cash equivalents, end of period | $2,031 | $4,528 | Notes to Condensed Consolidated Financial Statements Notes detail the company's name change, segment renaming, share repurchase program, and contingencies including the Portland Harbor Superfund Site - The company changed its name from Northwest Pipe Company to NWPX Infrastructure, Inc. on June 12, 2025, concurrently renaming the 'Engineered Steel Pressure Pipe (SPP)' segment to 'Water Transmission Systems (WTS)'[27][28] - The company has a share repurchase program of up to $30 million, repurchasing approximately 192,000 shares for $7.8 million in H1 2025, with $17.1 million remaining available[42][44] - The company is a potentially responsible party (PRP) for the Portland Harbor Superfund Site cleanup, but due to uncertainties, no accrual has been recorded for potential liability[53] - Backlog for the WTS segment was $298 million as of June 30, 2025, with approximately 48% expected to be recognized in 2025[69] Segment Performance (in thousands) | Segment Performance (Six Months Ended June 30) | 2025 (in thousands) | 2024 (in thousands) | | :--- | :--- | :--- | | Net Sales - WTS | $163,034 | $169,530 | | Net Sales - Precast | $86,263 | $73,190 | | Gross Profit - WTS | $27,229 | $31,223 | | Gross Profit - Precast | $17,501 | $14,725 | Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Management discusses H1 2025 net sales growth of 2.7% driven by Precast, offsetting WTS decline, with gross margin compression and adequate liquidity Results of Operations H1 2025 net sales increased 2.7% to $249.3 million (Precast growth, WTS decline), resulting in gross profit decrease and margin compression - WTS net sales decreased 3.8% in H1 2025 due to a 14% decrease in tons produced, partially offset by an 11% increase in selling price per ton[100] - Precast net sales increased 17.9% in H1 2025, driven by a 17% increase in volume shipped and a 1% rise in selling prices[101] - WTS gross profit decreased 12.8% in H1 2025 due to lower volume, with the segment's gross margin falling to 16.7% from 18.4%[103] - Precast gross profit increased 18.9% in H1 2025, primarily due to increased volume, with the segment's gross margin slightly improving to 20.3% from 20.1%[104] Liquidity and Capital Resources Liquidity is supported by operating cash flows and a $125 million credit agreement, with $197.2 million working capital and $93 million additional borrowing capacity - Working capital increased to $197.2 million as of June 30, 2025, from $187.4 million at year-end 2024[108] - Capital expenditures are projected to be between $19 million and $22 million in 2025, including approximately $2 million for a new reinforced concrete pipe mill[112] - As of June 30, 2025, the company had $30.6 million outstanding on its revolving line of credit, with an additional borrowing capacity of approximately $93 million[117] Item 3. Quantitative and Qualitative Disclosures About Market Risk Market risk disclosures for commodity prices, interest rates, and foreign currency exchange rates are unchanged from the 2024 Form 10-K - The company refers to its 2024 Form 10-K for a discussion of market risks, indicating no material changes during the quarter[126] Item 4. Controls and Procedures Management concluded disclosure controls were effective as of June 30, 2025, with no significant changes to internal control over financial reporting - The CEO and CFO concluded that the company's disclosure controls and procedures were effective as of the end of the quarter[128] - No significant changes to internal control over financial reporting occurred during the quarter ended June 30, 2025[129] PART II - OTHER INFORMATION Item 1. Legal Proceedings Routine legal actions are not expected to have a material impact; significant matters are detailed in Note 7 of the financial statements - The company states that its routine litigation is not expected to have a material impact, referring to Note 7, 'Commitments and Contingencies' for more significant proceedings[130] Item 1A. Risk Factors No material changes to the risk factors previously disclosed in the company's 2024 Annual Report on Form 10-K have occurred - The company directs investors to the risk factors discussed in its 2024 Form 10-K, indicating no material updates during the quarter[131] Item 2. Unregistered Sales of Equity Securities and Use of Proceeds The company repurchased 192,199 shares for $7.8 million in Q2 2025, with $17.1 million remaining from its $30 million program Share Repurchase Activity (2025) | Period (2025) | Total Shares Purchased | Average Price Paid Per Share | Approximate Dollar Value Remaining | | :--- | :--- | :--- | :--- | | April | 122,360 | $40.82 | $19,868,524 | | May | - | - | $19,868,524 | | June | 69,839 | $39.84 | $17,086,177 | | Total Q2 | 192,199 | $40.47 | $17,086,177 | - Subsequent to quarter end, an additional 171,000 shares were repurchased for $7.2 million, reducing remaining repurchase availability to $9.9 million[136] Item 5. Other Information CFO Aaron Wilkins adopted a Rule 10b5-1 trading plan on May 23, 2025, for the potential sale of up to 5,000 shares - CFO Aaron Wilkins adopted a Rule 10b5-1 trading plan on May 23, 2025, for the potential sale of up to 5,000 shares[137] Item 6. Exhibits This section lists the exhibits filed with the Form 10-Q, including corporate governance documents and required SEC certifications - The report includes a list of filed exhibits, such as corporate governance documents and required SEC certifications[138]