Financial Data and Key Metrics Changes - The company reported a modest sales growth of 0.6% year over year, with adjusted EBITDA down 7.9% to $11.4 million due to lower margins [4][8][9] - Net income declined significantly to $4.4 million from $35.9 million in the previous year, primarily due to the release of a $30 million tax valuation allowance in the prior year [5][8] - Cash provided by operations totaled $29.2 million, a favorable increase of $4.4 million compared to last year, contributing to a reduction in net debt to $55.3 million [5][9][16] Business Line Data and Key Metrics Changes - Infrastructure segment sales increased by 4.4%, driven by a 12.7% rise in steel products, while rail revenues decreased by 2.2% due to planned downsizing in the U.K. [4][8][10] - Rail segment revenues were $77.8 million, down 2.2%, with rail product sales declining by 5.9% [10][11] - Total track monitoring sales surged by 135.1%, and friction management sales increased by 9%, indicating strong performance in growth platforms [11][29] Market Data and Key Metrics Changes - The trailing 12-month book-to-bill ratio remained positive at 1.08, with a backlog of $247.4 million, up 18.4% year over year [6][18] - Rail backlog levels increased by 58.2%, with rail products orders up 59.9%, supporting growth expectations for Q4 [11][18] - Infrastructure backlog decreased by 10.9% due to order cancellations, but current demand levels for precast products remain solid [18][19] Company Strategy and Development Direction - The company is focused on transforming from a construction materials company to an innovation technology company, aiming for sustained growth and improved operational efficiency [43][44] - Capital allocation priorities include share repurchases and maintaining financial flexibility, with approximately 461,000 shares repurchased this year [16][17] - The company is evaluating potential tuck-in acquisitions, particularly in the precast concrete space, to complement its current portfolio [17][35] Management's Comments on Operating Environment and Future Outlook - Management noted that tariffs have not significantly impacted product costs, and the ongoing federal government shutdown has not yet adversely affected business activity [20][21] - The company anticipates a strong finish to 2025, with Q4 expected to see significant sales growth of approximately 25% and adjusted EBITDA up 115% [22][24] - Management expressed confidence in the backlog and manufacturing capacity to meet expected sales growth, despite potential risks from the government shutdown [23][24] Other Important Information - The effective tax rate remains elevated due to not recognizing a tax benefit on U.K. pre-tax losses, but improvements are expected in future quarters [15] - The company reported a gross margin of 22.5%, down 130 basis points from the previous year, attributed to lower rail sales volumes and unfavorable sales mix [8][9] Q&A Session Summary Question: Can you talk about your guidance in hitting the implied fourth-quarter sales and EBITDA guide? - Management indicated that there are no significant immediate impacts from the government shutdown, and they are optimistic about meeting guidance due to a strong backlog and active supply chain [25][26] Question: What are the drivers of the impressive sales growth in total track monitoring? - Management attributed the growth to strong performance across all strategic growth platforms, including total track monitoring, friction management, and precast [29][30] Question: How has the potential acquisition pipeline looked for precast concrete? - The company is actively evaluating precast acquisition opportunities, particularly in the Southeastern U.S., while also focusing on ramping up production in existing facilities [35][36]