Northwest Pipe Company (NWPX) Q1 2025 Earnings Call May 01, 2025 10:00 AM ET Company Participants Scott Montross - President & CEOAaron Wilkins - CFO Conference Call Participants Brent Thielman - MD & Senior Research AnalystJulio Romero - Equity AnalystTed Jackson - MD & Senior Research Analyst Operator and welcome to the Northwest Pipe Company First Quarter twenty twenty five Earnings Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presen ...

Financial Data and Key Metrics Changes - Revenue for Q1 2025 was approximately $1.5 billion, a decrease of 3% in actual currency and 1.1% in constant currency, including IT Savvy [5][24] - Adjusted operating income margin was 1.5%, down 70 basis points year over year [5][25] - Free cash flow was a use of $109 million, compared to a use of $89 million in the prior year [5][34] - Adjusted loss per share was $0.06, a decrease of $0.12 year over year [5][26] Business Line Data and Key Metrics Changes - Equipment revenue adjusted for currency declined approximately 1%, a 500 basis point improvement from the pace of decline in 2024 [6] - Equipment installations grew 24%, marking the third consecutive quarter of double-digit growth [6][29] - IT Solutions revenue and gross profit increased more than 100% year over year due to the inclusion of IT Savvy [31] - Print post-sale revenue declined around 11.2% in actual currency and 9.2% in constant currency [30] Market Data and Key Metrics Changes - Services renewal rates for large client contracts reached a multi-year high [6] - IT Solutions order activity was strong despite an uncertain operating environment [31] - The total IT solutions pipeline increased by 26% since the acquisition of IT Savvy [32] Company Strategy and Development Direction - The company is focused on executing over 100 reinvention initiatives to drive revenue stabilization and improve profitability [14] - The integration of IT Savvy is ahead of plan, with expected run rate synergies of over $15 million already implemented [10] - The company is actively engaged in the integration planning for the Lexmark acquisition, which is expected to close soon [17] Management's Comments on Operating Environment and Future Outlook - Management noted that the near-term operating environment is clouded by tariff and trade-related uncertainty, but improvements from organizational changes are evident [6] - The company expects minimal tariff or macro-related impacts on financial results in Q2 [40] - Guidance for the full year remains unchanged despite the fluid nature of tariff policies [37][64] Other Important Information - The company’s top capital allocation priority is debt repayment, with total debt decreasing by around $100 million [12] - The company expects to realize over $100 million in gross cost savings in 2025 [37] Q&A Session Summary Question: Impact of macroeconomic conditions on large corporate customers and SMBs - Management indicated that there has not been a discernible impact in Q1, although there is caution among clients [46][49] Question: Context on IT Savvy integration and metrics - Management expressed optimism about the potential to double the IT Solutions business by penetrating existing accounts [51][52] Question: Rationale for maintaining full year guidance amid tariff uncertainties - Management stated that guidance is maintained until tariffs are finalized, providing transparency to investors [63][64] Question: Future gross and operating margin rates for IT Solutions - Management aims for double-digit operating profit in IT Solutions, leveraging lower SG&A and cost structures [67][68]

Skechers U.S.A., Inc. (SKX) reported first-quarter 2025 results, wherein the top line missed the Zacks Consensus Estimate but the bottom line surpassed the same. While both metrics showed year-over-year growth, the company withdrew its full-year guidance due to ongoing economic uncertainty related to global trade policies. As a result, shares of this Manhattan Beach, CA-based footwear company declined 6.5% in the after-hours trading session yesterday.The company’s first-quarter results were driven by strong ...

Financial Data and Key Metrics Changes - West Fraser generated $195 million of adjusted EBITDA in Q1 2025, representing a 13% margin, which is a significant improvement over the previous quarter [6] - Over the trailing 12 months, the company generated $668 million of adjusted EBITDA, representing an 11% margin, an improvement from $561 million reported during the trough year of 2023 [8] - Cash flow from operations was negative $75 million for Q1, with a cash balance of $390 million, down from $641 million in the previous quarter [13] Business Line Data and Key Metrics Changes - The Lumber segment posted adjusted EBITDA of $66 million in Q1 2025, compared to $21 million in the fourth quarter, driven by higher product pricing and shipment volumes [10] - The North America EWP segment generated $125 million adjusted EBITDA in Q1, similar to the $127 million reported in the fourth quarter [11] - The Pulp & Paper segment generated $7 million adjusted EBITDA in Q1, recovering from a $10 million loss in the previous quarter [11] - The European business reported negative $2 million adjusted EBITDA in Q1, down from positive $2 million in the fourth quarter, primarily due to pricing issues [12] Market Data and Key Metrics Changes - U.S. housing starts averaged nearly 1.4 million units in Q1, indicating stabilization in new home construction despite elevated mortgage rates [7] - Repair and remodeling demand remains stable but subdued, with no significant changes observed [7] Company Strategy and Development Direction - The company aims to maintain a strong balance sheet and liquidity profile, allowing for countercyclical investments and growth opportunities [9] - West Fraser is focused on low-cost operations and a diverse product mix to navigate macroeconomic uncertainties, particularly regarding evolving tariff policies [16][20] - The company is actively monitoring tariff impacts and preparing operational plans to adapt to various scenarios [19] Management's Comments on Operating Environment and Future Outlook - Management expressed considerable macroeconomic uncertainty due to evolving U.S. tariff policies but remains optimistic about long-term industry prospects [21] - The company expects to catch up on delayed shipments despite a slower-than-expected start to the year, adjusting guidance conservatively [14] Other Important Information - The preliminary combined tariff rate for softwood lumber is 26.05%, the lowest in the Canadian industry, with final rates expected in the second half of the year [15] Q&A Session Summary Question: Demand trends in lumber and OSB as the busy season approaches - Management noted that customer purchasing has been cautious, with no significant changes in demand trends observed [26] Question: Capital allocation strategy and M&A pipeline - The company maintains a durable capital allocation strategy and is open to growth opportunities that meet high-quality standards [32][38] Question: Timing for the Section 232 investigation resolution - Management indicated a lack of visibility on the investigation's timing and potential impacts on OSB and lumber [42] Question: Impact of tariffs on OSB projects - Management stated that recent projects are progressing well and future projects will consider cost implications before decisions are made [53] Question: Demand for repair and remodeling products - Demand for repair and remodeling has remained subdued, with no significant shifts observed in the early weeks of Q2 [61] Question: Log inventory status in the SPF business - Log deliveries were less than expected due to weather, but the impact on inventory is not considered material [63]