Gibraltar Industries(US:ROCK)2022-05-07 16:12Financial Data and Key Metrics Changes - Revenue reached $316 million, up 10.5% on a reported basis and 11.8% on an adjusted basis, all organic growth [8][37] - Adjusted operating income grew 17%, adjusted EBITDA grew 12.1%, and adjusted EPS grew 11.1% to $0.60 per share [8][37] - Total company backlog reached $433 million at quarter end, up over 23% versus prior year [8][37] Business Line Data and Key Metrics Changes - Renewables: Segment revenue decreased 7.8% due to supply chain challenges and severe weather, with an adjusted operating loss of $4.3 million [39][41] - Residential: Revenue grew 28%, marking the seventh consecutive quarter of double-digit growth, with adjusted operating margin reaching 18.8%, up 240 basis points [11][43] - Agtech: Adjusted segment revenue decreased 2.9% due to project delays, but backlog increased 18% [47][48] - Infrastructure: Segment revenue increased 13.9%, driven by growth in fabricated products, though margins were impacted by steel inflation and labor availability [50][51] Market Data and Key Metrics Changes - The solar industry faced ongoing supply shortages and inflation, particularly affecting panel supply [24][29] - New bookings in the renewables segment were up 22% over the first quarter last year, resulting in backlog up 41% compared to the prior year [39][40] Company Strategy and Development Direction - The company is focusing on accelerating core greenhouse solutions in Agtech and exiting the processing equipment market due to declining demand [15][16] - In renewables, the company is enhancing operating systems and processes to support growth and improve execution performance [65] - The residential segment is expected to continue strong growth, driven by participation gains and effective price management [68] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving double-digit margins in renewables for the year despite Q1 challenges [80][82] - The company anticipates significant sequential margin improvement in Q2, driven by better project execution and supply chain clarity [80][81] - Management remains optimistic about the long-term growth potential of the solar industry, despite current challenges [33] Other Important Information - The company has initiated a $200 million stock repurchase program, reflecting confidence in its intrinsic value [60][62] - The company is investing in supply chain optimization and technology to enhance operational efficiency [49][56] Q&A Session Summary Question: Expectations for renewables margin improvement in Q2 - Management expects significant sequential margin improvement in Q2, driven by better project execution and supply chain clarity [80][81] Question: Participation gains and their permanence - Market share gains are considered sticky as long as the company continues to perform well and deliver value to customers [88] Question: Outlook for Agtech business and opportunities - The company is optimistic about the Agtech business, focusing on organic growth in produce and commercial segments, while also exploring bolt-on opportunities [95][100] Question: Impact of weather and supply chain on Q1 performance - Weather had a significant impact in January and February, compounding supply chain challenges [101][102]