Southland (US:SLND)2025-03-05 17:54Financial Data and Key Metrics Changes - Fourth quarter revenue was $267 million, down $49 million from the fourth quarter of 2023 [27] - Gross profit for the fourth quarter was $8 million, down from $21 million for the fourth quarter of 2023, resulting in a gross profit margin of 3% compared to 6.7% in the previous year [27] - Full-year revenue was $980 million, down from the previous year, with a gross loss of $63 million compared to a profit of $36 million in 2023, leading to a gross loss margin of negative 6.4% [33][39] - The company reported a net loss of $105 million or negative $2.19 per share for the year, compared to a net loss of $19 million or negative $0.41 per share in 2023 [37] Business Line Data and Key Metrics Changes - Civil segment revenues were $104 million, a decrease of $4 million from the fourth quarter of 2023, with a gross profit of $8 million, down from $25 million [31] - Transportation segment revenues were $163 million, down from $208 million in the fourth quarter of 2023, with a gross loss of $0.4 million, an improvement from a gross loss of $3 million [31] - For the full year, the Civil segment had revenues of $323 million, down $14 million from 2023, while the Transportation segment had revenues of $657 million, a decrease of approximately $166 million [38][39] Market Data and Key Metrics Changes - The company ended the quarter with approximately $2.57 billion of backlog, with $750 million of pending alternative delivery contracts not included in backlog [15][41] - The ongoing capital infusion from the Infrastructure Investment and Jobs Act and strong state and local infrastructure programs provide a favorable environment for business growth [19] Company Strategy and Development Direction - The company aims to execute core projects with precision, wind down legacy work, and strengthen its position in core markets [25] - The focus is on maintaining operational excellence and a disciplined approach to project selection, prioritizing high-quality backlog [21][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to capitalize on opportunities and drive long-term success, with expectations for positive EBITDA by the end of 2025 [54] - The demand in core markets remains robust, driven by ongoing infrastructure needs and strong public and private sector investments [21] Other Important Information - The company converted $20 million of certain promissory notes to common stock, reinforcing confidence in the business and improving the balance sheet [23] - The company expects to burn approximately 39% of its backlog in 2025 [41] Q&A Session Summary Question: How does the company see the book and burn work trending in 2025? - The company expects a back-weighted cadence for new awards and is optimistic about announcing impressive wins in 2025 [48][50] Question: Will the company have positive EBITDA in 2025? - The expectation is to return to positive EBITDA numbers by the end of the year, with a stronger finish anticipated [54][55] Question: What is the outlook for cash flow in 2025? - Strong cash flow from operations is expected in 2025, with seasonality weighted towards the back half of the year [78] Question: Are there concerns about federal funding for projects? - Management remains optimistic about the pipeline and opportunities, expecting to win a fair share of projects despite potential funding concerns [84][86] Question: How is the company positioned regarding tariffs and supply chain disruptions? - The majority of projects require made-in-America materials, minimizing cross-border exposure, and the company does not expect material impacts from tariffs [91][92]