Universal Technical Institute (NYSE:UTI) Q4 2025 Earnings Call November 19, 2025 04:30 PM ET Speaker1Good afternoon, and welcome to the Universal Technical Institute Fourth Quarter and Full Year 2025 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star, then one on your ...

Core Insights - The U.S. equity markets have experienced volatility, with gains in blue-chip tech companies offset by concerns over AI firm valuations, leading to expectations of a market correction [2] - Investors are anxious about the Federal Reserve's potential actions regarding interest rates amid a government shutdown that has created a data vacuum [2] - The upcoming September nonfarm payrolls report is highly anticipated for insights into economic trends and Federal Reserve decisions [3] Momentum Investing Strategy - Momentum investing is characterized by "buying high and selling higher," capitalizing on established trends in stock prices [4] - This strategy has historically generated alpha across various market conditions, though it requires skill to identify trends effectively [5] - A screening strategy has been developed to identify stocks with long-term price momentum and short-term pullbacks [5] Screening Parameters - The screening process selects the top 50 stocks based on the best percentage price change over the past 52 weeks [6] - From these, the 10 worst performers over the last week are chosen to identify those experiencing short-term pullbacks [7] - Stocks with a Zacks Rank 1 (Strong Buy) and a Momentum Style Score of B or better are prioritized for selection [8] Selected Stocks - Seagate Technology Holdings plc (STX) has seen a 169.4% increase over the past year but a recent decline of 11.1%, with a Momentum Score of B [12] - Robinhood Markets, Inc. (HOOD) has surged 231.3% in the past year but dropped 14.6% in the last week, holding a Momentum Score of A [14] - Everus Construction Group, Inc. (ECG) has increased by 46.7% over the past year but declined 13.7% recently, also with a Momentum Score of A [15]

Financial Data and Key Metrics Changes - The company reported third quarter revenue of $213 million, an increase of $40 million from the same period in 2024 [10] - Gross profit was $3.3 million, up $54.4 million from the same period in 2024, with a gross profit margin of 1.5%, compared to negative 29.5% in the prior year [10][4] - Selling, general, and administrative costs decreased by $2.9 million to $14.6 million compared to the same period in 2024 [11] - The company reported a net loss of $75.2 million or $1.39 per share, compared to a net loss of $54.7 million or $1.14 per share in the same period last year [13] - EBITDA was negative $3.5 million, an improvement from negative $58.7 million for the same period in 2024 [13] Business Line Data and Key Metrics Changes - The Civil segment had revenue of $99.5 million, up from $55.8 million in the same period in 2024, with a gross profit of $10.4 million and a gross margin of 10.5% [14] - The Transportation segment reported revenue of $113.9 million, a decrease of $3.6 million from the same period in 2024, with a gross loss of $7.2 million [15] - The Materials and Paving business line contributed $22.9 million to revenue, with a gross loss of $3 million [15] Market Data and Key Metrics Changes - The company added approximately $151 million in new awards and contract adjustments during the quarter, bringing the total backlog to approximately $2.26 billion [6] - The company expects to burn approximately 39% of the backlog over the next 12 months [16] Company Strategy and Development Direction - The company is focusing on finalizing remaining legacy projects and transitioning to high-quality new core backlog, expecting to de-risk its earnings profile [6] - The strategy includes targeting short-duration, high-margin projects in both public and private markets, with a strong emphasis on data center opportunities [7][8] - The company is positioned to benefit from significant public market opportunities driven by the Infrastructure Investment and Jobs Act (IIJA) [8] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the resolution of legacy disputes and expects significant cash collections from these disputes [5][22] - The outlook for the market remains positive, with robust demand for infrastructure expected to continue for years [6] - The company anticipates improving profitability as it transitions fully into its core business by 2027 [41] Other Important Information - The company is exploring debt solutions to provide additional capacity and flexibility in accelerating work on the legacy backlog [16] - A one-time non-cash tax expense of $57.3 million was recorded due to a valuation allowance on net deferred tax assets [12] Q&A Session Summary Question: Inquiry about data centers and private projects - Management indicated that they are looking at data centers that align with their core market, with opportunities ranging from $15 million to $75 million [40] Question: Free cash flow outlook for Q4 - Management noted that while positive cash flow from operations was generated, a decrease may be expected in Q4 and Q1 of 2026, but overall positive cash flow is anticipated in 2026 [32] Question: Impact of Texas's Proposition Four on civil projects - Management expressed confidence in civil margins and highlighted the potential benefits from the $20 billion allocated for water projects in Texas [34] Question: Competitive advantage with tunnel boring machines - Management stated that they have a significant advantage with their own tunnel boring machines and a large fleet, positioning them well for upcoming tunnel opportunities [35] Question: Expectations for core business margins in 2027 - Management expects to improve profitability in 2027 as they focus on core work, following a reset year in 2025 [41]

Core Insights - Klook, a Hong Kong-based travel platform, is preparing for an initial public offering (IPO) in the U.S., indicating strong investor demand despite a government shutdown [2][3] Financial Performance - Klook reported a revenue of $417.1 million for 2024, marking a 24.4% increase from $335.2 million in the previous year, driven by a post-COVID surge in global tourism and strong consumer spending [2][3] Market Position - Klook competes with major players like Booking.com and TripAdvisor, as well as regional competitors such as Trip.com in China and Yanolja in South Korea, offering bookings for tours, attractions, transport, and other travel experiences [3] Target Demographics - The platform's core user base consists of young, tech-savvy millennials and Gen Z consumers, who are characterized by their increasing spending power and preference for experiences over material goods [4] Consumer Behavior Trends - Recent research indicates that both Generation Z and baby boomers exhibit similar behaviors in travel planning, challenging the notion that mobile-first travel is exclusive to younger consumers [5][7] - Smartphones have become the preferred method for purchasing transportation, with over 70% of American consumers opting for mobile devices for local rides and transit tickets [6]

Financial Data and Key Metrics Changes - The company achieved a consolidated revenue growth of 9% year-over-year, driven by a sequential pricing acceleration to 6.3% and positive volume growth of 100 basis points [13][15] - Adjusted EBITDA margin reached 31.6%, the highest in the company's history, with underlying solid waste margins expanding by 250 basis points [15][9] - Adjusted free cash flow was reported at $181 million, exceeding expectations due to strong adjusted EBITDA performance [16] Business Line Data and Key Metrics Changes - The company experienced near double-digit top-line growth, attributed to effective pricing strategies and ancillary surcharges [7] - MSW (Municipal Solid Waste) volumes increased, offsetting declines in construction-oriented activity and special waste volumes [8][15] - The company deployed nearly $650 million into acquisitions year-to-date, with an active M&A pipeline expected to contribute to future growth [10][9] Market Data and Key Metrics Changes - Volumes grew by 5% in Canada, while the U.S. saw a slight decline of 0.9%, impacted by lower C&D and special waste volumes [15][55] - The company noted broader economic uncertainty affecting market activity levels, particularly in construction and industrial sectors [8] Company Strategy and Development Direction - The company is focused on maintaining a strong M&A pipeline and executing share buybacks, viewing current share prices as attractive [11][42] - The management expressed confidence in the company's operating plan and growth trajectory, with expectations for continued margin expansion [18][32] - The company aims to leverage its asset base and pricing strategies to navigate economic challenges and capitalize on recovery opportunities [6][8] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenging macroeconomic backdrop but emphasized the resilience of the business model and the effectiveness of value creation strategies [6][7] - The company raised its full-year guidance for revenue and adjusted EBITDA, reflecting strong operational performance and M&A contributions [16][10] - Management remains optimistic about the potential for economic recovery and the company's ability to capitalize on it [8][18] Other Important Information - The company completed a recapitalization of GIP, valuing it at $4.25 billion, which returned approximately $585 million to shareholders [10][11] - The company repurchased $350 million of shares in Q3 and nearly $2.8 billion year-to-date, indicating a commitment to returning capital to shareholders [12][11] Q&A Session Summary Question: Can you walk us through the guidance update and how M&A effects were considered? - Management explained that the guidance was raised due to strong pricing and volume performance, with M&A contributing approximately $200 million in annualized revenue [20][24] Question: What is the status of the EPR ramp and its expected contributions? - Management indicated that EPR has outperformed expectations, contributing about $15 million in Canada for the quarter, with further contributions expected in 2026 [25][27] Question: How do you view the runway EBITDA and its growth potential? - Management noted that the current EBITDA run rate includes large EPR contracts, and they expect double-digit growth in EBITDA for the next year [30][32] Question: Can you provide insights on SG&A trends and cost absorption? - Management highlighted an 80 basis point improvement in SG&A, attributing it to better labor turnover and operational efficiencies [34][36] Question: What actions are being considered to unlock shareholder value? - Management reiterated their commitment to share buybacks and M&A, viewing current share prices as an opportunity to enhance shareholder value [39][42] Question: Can you elaborate on pricing metrics and trends? - Management discussed the impact of EPR on pricing, noting that pricing is expected to be lower next year without the same level of EPR benefits [79][70]

Core Insights - BetWhale is recognized as a leading choice among PayPal casinos in the USA, offering seamless transactions and a user-friendly experience for online gaming enthusiasts [3][4][23] Payment Options and Speed - BetWhale supports PayPal for instant deposits and withdrawals within 10 minutes, alongside other cryptocurrencies like Bitcoin, Ethereum, and Litecoin, which also offer instant transactions [19] - Traditional payment methods such as Visa/Mastercard have a withdrawal speed of 1-3 business days, while bank transfers take longer [19] Bonuses and Promotions - New players at BetWhale can benefit from a 250% welcome bonus up to $2,500 for casino games and a 200% welcome bonus up to $6,000 for sports betting, enhancing their initial gaming experience [7] - Regular players can enjoy ongoing promotions like Pick a Box Rewards, tournaments, and loyalty rewards that provide additional incentives for continued play [8][9] Game Variety - BetWhale boasts a diverse library of over 4,000 games, including slots, table games, and sports betting options, catering to various player preferences [11][23] - The platform features engaging slot games with unique themes and high payout potential, as well as classic table games like blackjack and roulette [12][13] Partnerships and Security - BetWhale collaborates with reputable game developers such as BetSoft and Rival Gaming, ensuring high-quality gaming experiences and fair play [14][15] - The platform employs 256-bit SSL security to protect user data and transactions, maintaining a safe environment for players [24] Customer Support - BetWhale offers 24/7 customer support through email and live chat, addressing player inquiries and issues promptly to enhance user satisfaction [20][21] - The support team is trained to assist with common queries and promote responsible gaming practices [21]

Strattec Security Corporation FY Conference Summary Company Overview - **Company Name**: Strattec Security Corporation - **Ticker**: NasdaqGM: STRT - **Market Cap**: Approximately $280 million with about $200 million in equity cap - **Shares Outstanding**: Roughly 4 million shares - **Location**: Milwaukee, Wisconsin - **Debt**: No debt at the parent level, $90 million in net cash, and $25 million in minority interest [1][3] Industry and Product Portfolio - **Industry**: Automotive access control systems - **Core Products**: - Vehicle locks - Active tailgates and liftgates - Enhanced locks and keys - Passive entry systems - **Revenue Breakdown**: Approximately 8% of revenue from aftermarket sales [1][3][4] Strategic Initiatives - **Leadership Changes**: New CEO Jen Slater and CFO Matthew Pauli have focused on operational changes and team restructuring [2][4] - **Cultural Shift**: Emphasis on innovation, collaboration, and results-driven performance [5][6] - **Business Operating System**: Implementation of a business operating system to improve margin and cash generation [6][7] Financial Performance - **Q1 FY 2026 Revenue**: $152 million, up 10% year-over-year, outperforming North American automotive production growth of 5% [12] - **Sales Growth**: Continuous growth observed post-chip shortages, with a trailing 12-month sales figure of $578 million [13] - **Gross Profit Margin**: 17.3% for Q1 FY 2026, significantly improved due to price increases and restructuring benefits [14] - **Net Income**: $8.5 million or $2.07 per share for Q1 FY 2026, with adjusted EBITDA of $15.6 million and a 10.2% EBITDA margin [16] Cost Structure and Tariffs - **Cost Management**: Focus on cost structure improvements, with a 15% reduction in headcount year-over-year [14][15] - **Tariff Impact**: Annual tariff costs estimated at $5-7 million, largely offset by price increases [15][34] Future Outlook - **Revenue Projections**: Expected to align with North American automotive production volumes [11] - **Product Development**: Focus on modernizing product offerings, including the development of digital key fobs and power access products [10][11] - **M&A Considerations**: Future M&A opportunities are being evaluated, with a focus on organic growth and capital allocation [18][37] Operational Flexibility - **Manufacturing Footprint**: Operations in both the U.S. and Mexico, with over 90% of products compliant with USMCA [24][28] - **Adaptability**: Ability to adjust manufacturing strategies in response to tariff changes and customer needs [28][29] Key Takeaways - Strattec is undergoing a significant transformation under new leadership, focusing on operational efficiency and product innovation - Financial performance has improved markedly, with strong revenue growth and profitability metrics - The company is well-positioned to adapt to market changes and capitalize on growth opportunities in the automotive sector [18][43]

Core Insights - Casella Waste Systems, Inc. reported record performance in key financial metrics for Q3 2025, driven by a disciplined acquisition strategy and strong organic growth [3][4][6] - The company completed eight acquisitions in 2025, contributing approximately $105 million in annualized revenue, with an additional $30 million expected from a pending acquisition [3][4] - Revenue for Q3 2025 reached $485.4 million, a 17.9% increase from Q3 2024, primarily due to acquisition impacts, price growth, and strong performance in the Resource Solutions segment [4][7] Financial Performance - Operating income for Q3 2025 was $29.4 million, up 20.5% from the same period in 2024, excluding a non-recurring landfill closure charge [5][6] - Net income for Q3 2025 was $10.0 million, a significant increase of 73.0% compared to Q3 2024, largely influenced by operating income factors [6][7] - Adjusted EBITDA for Q3 2025 was $119.9 million, reflecting a 16.4% increase year-over-year, driven by both acquisitions and organic growth [6][7] Cash Flow and Guidance - Net cash provided by operating activities for the year-to-date period was $233.2 million, a 35.9% increase from the same period in 2024 [9] - Adjusted Free Cash Flow for the nine months ended September 30 was $119.5 million, up 21.0% from the previous year [9] - The company raised the lower end of its revenue and Adjusted EBITDA guidance for fiscal year 2025, reflecting confidence in strong performance and limited exposure to recycled commodity price volatility [11][16] Acquisition Strategy - The company has positioned itself to capitalize on a robust acquisition pipeline, with ongoing integration efforts in the Mid-Atlantic region expected to enhance business performance [3][4] - The anticipated acquisition of Mountain State Waste is expected to add another $30 million in annualized revenue, further strengthening the company's market position [3][4] Market Position - Casella Waste Systems provides solid waste, recycling, and resource management services primarily in the eastern United States, serving a diverse customer base [17]

Core Viewpoint - Raytech Holding Limited has announced a 16-for-1 share consolidation to comply with Nasdaq's minimum bid price requirement, effective November 7, 2025 [1][2]. Group 1: Share Consolidation Details - The share consolidation will convert every 16 ordinary shares into one ordinary share, affecting all shareholders uniformly without altering their percentage ownership, except for minor changes due to fractional shares [3]. - No fractional shares will be issued; shareholders will receive one full share instead of any fractional share resulting from the consolidation [4]. - The authorized share capital will decrease from 8 billion ordinary shares to 500 million ordinary shares, and the total issued and outstanding shares will reduce from approximately 43.6 million to about 2.7 million [5]. Group 2: Company Overview - Raytech Holding Limited is based in Hong Kong and specializes in the design, sourcing, and wholesale of personal care electrical appliances for international brand owners, with over 10 years of industry experience [6].

Financial Data and Key Metrics Changes - The company raised its full-year AFFO guidance, expecting mid-5% year-over-year growth, which is among the highest in the net lease sector [4] - AFFO per share for Q3 was $1.25, a 5.9% increase compared to the same quarter last year [12] - The expected full-year 2025 AFFO is between $4.93 and $4.99 per share, implying 5.5% year-over-year growth at the midpoint [12][14] - The company has over $2 billion in liquidity, providing flexibility for future investments [5][20] Business Line Data and Key Metrics Changes - Year-to-date investment volume reached $1.65 billion with a weighted average initial cap rate of 7.6% [7] - Same-store rent growth remains strong at 2.4% year-over-year for the quarter, with expectations of around 2.5% for the full year [15] - The company completed sales of 37 operating self-storage properties and one student housing property this year [17] Market Data and Key Metrics Changes - The investment activity in Europe has increased, with a split closer to 50/50 between North America and Europe in Q3 [44] - The company continues to see strong opportunities in the industrial sector, which represents the majority of its investment volume [7][92] Company Strategy and Development Direction - The company plans to allocate more capital to capital projects, which historically averaged 10% to 15% of annual investment volume [10] - The strategy includes funding investments through accretive sales of non-core assets, with expected disposition volume increased to between $1.3 and $1.5 billion [14] - The company aims to maintain a competitive edge in Europe through established relationships and local expertise [8][97] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in sustaining momentum into 2026, with an active deal pipeline extending into the first quarter of 2026 [22] - The company noted that while competition in the net lease market has increased, it remains manageable due to its cost of capital and execution track record [30][31] - Management remains cautious regarding the economic environment but expects strong earnings growth despite potential challenges [39] Other Important Information - The company increased its quarterly dividend by 4% year-over-year to $0.91 per share, reflecting strong earnings growth [20] - The balance sheet remains strong, with manageable debt maturities and a weighted average interest rate of 3.2% [19][20] Q&A Session Summary Question: Update on operating self-storage asset sales and future funding sources - Management indicated that equity will play a larger role in funding next year, with a return to more typical disposition levels [27][28] Question: Competition from private net lease platforms - Management acknowledged increased competition but believes their experience and reputation provide a competitive advantage [30][31] Question: Status of Helveg leases and exposure reduction - Management reported progress in reducing exposure to Helveg, with several leases signed and properties under contract for sale [36] Question: Pipeline details and geographic split - Management confirmed a strong pipeline with several hundred million dollars in transactions, noting increased activity in Europe [44] Question: Sustainability of same-store rent growth amid inflation changes - Management expects contractual same-store growth to remain strong, supported by fixed increases and CPI-linked escalations [50][52] Question: Cap rate expectations and differences between U.S. and Europe - Management noted that cap rates have remained stable, with slight tightening expected as competition increases [78][79] Question: Visibility on lease expirations for 2026 and 2027 - Management confirmed that virtually all expiring ABR for 2026 and 2027 is actively being worked on, with manageable levels expected [108]