Limbach(US:LMB)2020-06-16 18:04Financial Data and Key Metrics Changes - Consolidated revenue increased by 3.8% year-over-year, amounting to a growth of $3.8 million [21][33] - Adjusted EBITDA declined from $5.2 million last year to $3.7 million due to prior year write-up and COVID-19 impact [39] - Consolidated gross margin was 13.1%, showing a modest improvement of 10 basis points over the previous year [38] Business Line Data and Key Metrics Changes - The construction segment accounted for all revenue growth, with broad-based increases outside of mid-Atlantic and Western Pennsylvania operations [22][33] - Revenue in the service segment remained flat, impacted by mild weather and COVID-19 in March [34] - Service sales increased by over 53% year-over-year, indicating a rebound in most markets [36][45] Market Data and Key Metrics Changes - The most heavily impacted market was New England, which saw a complete shutdown but reopened for construction at the end of May [9][12] - Other markets experienced isolated project suspensions, but overall project backlog remained intact with no cancellations [11][42] - The company reported a total backlog of $534.9 million, with $472 million attributable to the construction segment [42] Company Strategy and Development Direction - The company is focusing on liquidity and working capital management, with a positive operating cash flow of $3.5 million in Q1 [51] - A strategic shift towards owner-direct services is being emphasized, with plans to increase the service segment's contribution to revenue [66][75] - The company aims to achieve a revenue split of 50/50 between construction and service by 2025, up from a previous target of 70/30 [75] Management's Comments on Operating Environment and Future Outlook - Management anticipates a challenging economic recovery but remains optimistic about the company's backlog and market opportunities [54][56] - The essential nature of the company's work has been validated during the pandemic, with expectations for continued demand in maintenance and service [57][58] - The company is adjusting its project selection criteria to enhance risk management and profitability [61][66] Other Important Information - The company has restructured its leadership team to improve decision-making and operational efficiency [60] - There is a focus on maximizing profitability and cash flow through better project execution and cost management [64] - The company is exploring new digital technology-enhanced products to enhance service offerings [70] Q&A Session Summary Question: What are the new parameters for large projects? - The company is still considering large-scale projects in certain geographies but will implement better risk management processes [82] Question: What is the current bidding and quoting activity? - There is still opportunity in construction, but decision-making has slowed down due to the pandemic [86] Question: Any near-term directional parameters for guidance? - The company expects some pullback in Q2 but has seen some offsetting revenue from emergency projects [94] Question: What are the goals for SG&A and gross margin improvement? - The service margins are expected to land in the low to mid-20% range, while SG&A is anticipated to be a few percentage points over last year [99][101] Question: What is the status of refinancing debt? - The company is focused on refinancing and is entering the market this year, timing is still being determined [112]