Matrix Service pany(US:MTRX)2025-11-06 21:49Revenue and Profitability - Revenue for the first quarter of fiscal 2026 increased by $46.3 million, or 28%, compared to the first quarter of fiscal 2025, driven by higher volumes in the Storage and Terminal Solutions and Utility and Power Infrastructure segments [62][77]. - Gross profit rose by $6.4 million, or 82%, in the first quarter of fiscal 2026, with a gross margin of 6.7%, up from 4.7% in the same period last year [78]. - Total revenue for the three months ended September 30, 2025, was $211.9 million, an increase of $46.3 million, or 28%, compared to $165.6 million in the same period last year [82]. - Total gross profit increased by $6.4 million, or 82%, reaching $14.2 million for the three months ended September 30, 2025 [82]. - The company reported a net loss of $3.7 million for the first quarter of fiscal 2026, a 60% improvement compared to a net loss of $9.2 million in the same quarter of the previous year [77]. Project Awards and Backlog - Project awards during the quarter totaled $187.8 million, resulting in a book-to-bill ratio of 0.9x, with significant contributions from the Storage and Terminal Solutions segment [63][67]. - Backlog as of September 30, 2025, was $1,161 million, down from $1,382 million as of June 30, 2025, primarily due to revenue recognized and adjustments in project awards [67]. - The Storage and Terminal Solutions segment booked $136.1 million in project awards, indicating strong demand for storage infrastructure projects related to LNG and NGLs [69]. - The Utility and Power Infrastructure segment secured $34.7 million in project awards, although backlog was impacted by the removal of a previously awarded project due to increased risk [70]. - The Process and Industrial Facilities segment recorded $16.9 million in project awards, with ongoing opportunities in mining, chemicals, and renewable fuels [73]. Expenses and Cost Management - Selling, general and administrative expenses decreased by $2.2 million, or 12%, due to cost reductions from organizational realignment [79]. - The company incurred $3.3 million in restructuring costs during the first quarter of fiscal 2026 related to organizational restructuring [79]. - The company initiated a restructuring effort in the fourth quarter of fiscal 2025 to improve efficiency and align with market conditions, aiming to reduce overall cost structure [64]. Cash Flow and Liquidity - Unrestricted cash and cash equivalents totaled $192.3 million as of September 30, 2025, with total liquidity of $248.9 million [90]. - Cash used by operating activities was $25.9 million for the three months ended September 30, 2025, compared to cash provided of $11.9 million in the same period last year [96]. - Accounts payable increased by $17.7 million, contributing positively to cash flows from operating activities [99]. - Inventories and other current assets increased by $9.1 million, negatively impacting cash flows from operating activities [99]. - Cash flows used by investing activities were $1.8 million and $1.9 million for the three months ended September 30, 2025, and 2024, respectively, primarily due to capital expenditures [100]. - Financing activities used $4.3 million and $1.2 million of cash in the three months ended September 30, 2025, and 2024, respectively, mainly for tax withholding obligations related to stock-based compensation [101]. Financial Instruments and Risk Management - The ABL Facility has a maximum loan amount of $90.0 million, with availability under the facility totaling $56.6 million as of September 30, 2025 [95]. - As of September 30, 2025, there were $186.2 million of surety bonds in force, with $126.9 million expected to expire within the next 12 months [104]. - The company has never paid cash dividends on common stock, and future dividend payments will depend on financial condition and other relevant factors [102]. - The Stock Buyback Program allows for the repurchase of up to 2,707,175 shares, with 1,349,037 shares available for repurchase as of September 30, 2025 [103]. - There have been no material changes in critical accounting policies and estimates from those reported in the fiscal 2025 Annual Report [105]. - No material changes in market risk have been reported since the fiscal year ended June 30, 2025 [106].