Great Lakes Dredge & Dock (US:GLDD)2025-05-06 14:00Financial Data and Key Metrics Changes - The company reported revenues of $242.9 million for Q1 2025, an increase of $44.2 million compared to Q1 2024, marking the second highest revenue quarter in company history [11] - Adjusted EBITDA for the quarter was $60.1 million, with an adjusted EBITDA margin of 24.7% [11] - Net income for Q1 2025 was $33.4 million, up from $21 million in the same quarter of the previous year [12] - Gross profit increased to $69.5 million with a gross profit margin of 28.6%, compared to $45.6 million and 22.9% in Q1 2024 [11][12] Business Line Data and Key Metrics Changes - The dredging backlog remains strong at $1 billion, with capital and coastal protection projects accounting for 95% of this backlog [7] - Over 87% of revenue in Q1 2025 came from capital and coastal protection projects, which typically yield higher margins [12] Market Data and Key Metrics Changes - The U.S. Army Corps of Engineers is operating under a continued resolution for fiscal year 2025, sustaining record funding levels established in the prior fiscal year's budget [15] - The bid market for 2025 is expected to normalize at approximately $2 billion, focusing on coastal protection projects funded by the 2023 Disaster Relief Supplemental Appropriation Act [16] Company Strategy and Development Direction - The company is focusing on large and complex projects, particularly in the beach renourishment and port deepening markets, which are expected to continue delivering strong performance [15][17] - The company is expanding its offshore wind business into international markets, including the UK, EU, and Asia, to mitigate potential delays in the U.S. offshore wind market [17] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strong performance and backlog, indicating that 2025 results are expected to exceed those of 2024 [14][17] - The company anticipates being cash flow positive starting in 2026, with a robust liquidity position to support ongoing strategic initiatives [13][18] Other Important Information - The company has initiated a $50 million share repurchase program, citing that the share price does not reflect the company's financial performance and long-term outlook [8] - The company has upsized its revolving credit facility to $330 million, enhancing liquidity [13] Q&A Session Summary Question: Update on the Equinor project, Empire Wind One - Management stated that the project was fully funded and permitted, and the temporary pause was unexpected. They are in contact with Equinor to clarify the situation [22][23] Question: How quickly can the Acadia's time slots be refilled if the project is canceled? - Management indicated that it would be difficult to fill the time slots quickly, but there are cancellation arrangements in the contract that would mitigate some costs [25][26] Question: Update on the Woodside job and ongoing LNG projects - The base work for the Woodside project is in low bid pending and will be added to the backlog in Q2. The ongoing LNG projects are performing well and are expected to wrap up as scheduled [42][43] Question: Competitive environment and bid market pace - Management noted that the competitive environment remains similar to historical levels, with some dredges taken out of operation and new builds entering the market [35] Question: Impact of dry docks on Q1 performance - Management confirmed that the dry dock in Q1 was a hopper dredge and that Q2 will be most impacted by dry docks, but they expect a normalization in the second half of the year [49][51]