Limbach(US:LMB)2023-08-10 14:52Financial Data and Key Metrics Changes - The company reported consolidated top line growth of 7.5%, with ODR revenues up 18.1% year-over-year, while GCR revenue remained flat [23][39] - Consolidated gross margin for the second quarter was 22.8%, with GCR gross margin at 17.1% and ODR gross margin at 29.3% [44] - Free cash flow for the quarter was $8.8 million, approximately 74% of adjusted EBITDA [7] Business Line Data and Key Metrics Changes - The ODR segment accounted for 47.1% of total consolidated revenue, an increase from 42.9% the previous year [23] - The company is focusing on increasing the proportion of revenues from the ODR segment to enhance consolidated gross margin [21][47] Market Data and Key Metrics Changes - The company has a strong balance sheet with cash and cash equivalents of $45.9 million and a net cash position of $23.6 million at quarter end [24] - Demand in mission-critical vertical markets remains strong, with a focus on maintaining durable demand through emergency and on-demand services [29][54] Company Strategy and Development Direction - The strategic plan focuses on three primary value drivers: segment mix, evolved offerings for customers, and a strategic acquisition plan [3][48] - The company is pursuing tuck-in acquisitions to expand market share and larger acquisitions to enter new geographies [48] - The acquisition of ACME Industrial is expected to enhance customer relationships and market position in the hydroelectric sector [22] Management Comments on Operating Environment and Future Outlook - Management reiterated revenue guidance for 2023 in the range of $490 million to $520 million and adjusted EBITDA guidance increased to $38 million to $41 million [10][53] - The company is adapting to new supply chain dynamics and equipment availability challenges, emphasizing the importance of maintaining strong demand [55] Other Important Information - SG&A expenses for the quarter were $20.4 million, down from $21.1 million in the first quarter but up from $18.7 million year-over-year [6] - The company is actively enhancing its social media presence to showcase projects and services [12][36] Q&A Session Summary Question: Demand growth in ODR business - Management noted strong demand across both direct projects and maintenance, with a focus on consultative partnerships with clients [30][40] Question: Future EBITDA margin targets - Management indicated that while strong progress has been made on EBITDA margins, growth will continue to be driven by revenue increases rather than a fixed target [57]