Financial Performance - Revenue for the three months ended October 3, 2025, was $141.92 million, a decrease of 15% compared to $166.04 million for the same period in 2024[117]. - Gross margin for the three months ended October 3, 2025, was $10.79 million, down 11% from $12.19 million in the prior year[117]. - Net loss for the three months ended October 3, 2025, increased to $4.40 million, representing a 181% increase from a net loss of $1.56 million in the same period in 2024[131]. - Revenue for the nine months ended October 3, 2025, was $392.43 million, a 4% increase from $376.68 million in the same period in 2024[132]. - Gross margin for the nine months ended October 3, 2025, was $23.61 million, a significant improvement from a gross margin loss of $34.80 million in the prior year[133]. - Net loss decreased by $63 million to $23 million, primarily due to a $58 million increase in gross margin and a $16 million decrease in ERP pre-implementation asset impairment[147]. Project Backlog - As of October 3, 2025, the company had a project backlog of approximately $754 million, primarily located in California, with ongoing projects in six other states[94]. - The company reported a backlog of projects amounting to $754 million as of October 3, 2025[189]. - Total backlog as of October 3, 2025, is composed of 66% from state and local agencies, 19% from federal agencies, and 15% from private owners[191]. - The backlog by contract type shows 87% as fixed-price contracts and 13% as cost reimbursable contracts[191]. - Estimated backlog recognition indicates that 85% is expected to be recognized within 0 to 24 months, 5% within 25 to 36 months, and 10% beyond 36 months[191]. Revenue Sources - Revenue from Shimmick Projects was $106.83 million for the three months ended October 3, 2025, a 5% increase from $101.48 million in the prior year[118]. - Revenue from Shimmick Projects increased by $38 million to $313 million for the nine months ended October 3, 2025, driven by $62 million from new higher margin projects and $31 million from a California Palisades fire clean-up project[134]. - Non-Core Projects revenue decreased by 46% to $35.09 million for the three months ended October 3, 2025, down from $64.56 million in the same period in 2024[118]. - Non-Core Projects revenue decreased by $21 million to $80 million, primarily due to a $13 million reduction from a project completion and the absence of a $31 million favorable settlement from the GGB Project[136][137]. - Revenue from Non-Core Loss Projects was $61 million, with a gross margin of $(3) million, showing improvement from $(34) million in the prior year[139]. Costs and Expenses - Selling, general and administrative expenses increased by $1 million to $14.29 million for the three months ended October 3, 2025, primarily due to increased legal costs[125]. - Selling, general and administrative expenses decreased by $4 million due to the implementation of a transformation plan[140]. - The company incurs significant selling, general, and administrative expenses as a public entity, which were not present during its private ownership[109]. Capital and Liquidity - Capital expenditures for the nine months ended October 3, 2025, were approximately $6 million, down from $10 million in the prior year[160]. - Unrestricted cash and cash equivalents totaled $18 million, with total liquidity of $48 million available from credit agreements[160]. - The company had a net cash decrease of $16.9 million for the nine months ended October 3, 2025, compared to a decrease of $37.3 million in the prior year[177]. - Net cash used in operating activities was $65.7 million, consistent with the previous year's $66.2 million[177][178]. - Net cash provided by financing activities for the nine months ended October 3, 2025, was $46.9 million, primarily from net borrowings of $49 million[184]. Debt and Financing - As of October 3, 2025, the company had a total debt of $57.5 million, with long-term debt netting $54.1 million[164]. - The ACF Credit Agreement provides a total commitment of $15 million with an interest rate of adjusted term SOFR plus 4.50%[169]. - The company incurred $450 thousand in cash interest during the three months ended October 3, 2025, and $1 million for the nine months[172]. - The company has a maximum leverage ratio covenant tested quarterly starting from the fourth quarter of 2026 under the Credit Agreement[168]. Public Offering and Market Activity - The company completed its initial public offering on November 16, 2023, selling 3,575,000 shares at a price of $7.00 per share, resulting in net proceeds of approximately $19 million[97]. - The company entered into an At The Market Offering Agreement allowing the sale of up to $7.8 million of common stock[173]. Operational Focus - The company focuses on critical infrastructure projects, including climate resilience, water and wastewater treatment, and energy transition initiatives[92][102]. - The company aims to minimize concentration of work with any one customer or industry to reduce risks and enhance competitiveness[104]. - The company self-performs many projects to better control costs and schedules, which is believed to deliver greater value to clients[94]. - The company has experienced seasonality in revenue, typically seeing the lowest revenue in the first quarter due to adverse weather conditions[100]. - The company faces risks related to project cancellations, which could significantly reduce expected revenue from its backlog[101].
Shimmick (SHIM) - 2025 Q3 - Quarterly Report