Concrete Pumping Holdings, Inc.

Good afternoon, everyone, and thank you for participating in today's conference call to discuss Concrete Pumping Holdings financial results for the first quarter ended January 31st, 2024. Joining us today are Concrete Pumping Holdings CEO, Bruce Young, CFO, Ian Humphreys, the company's external director of investor relations, Cordy Slow. Before we go further, I would like to turn the call over to Mr. Cordy Slow, to read the company's safe harbor statements within the meaning of the Private Securities Litigation Reforms Act of 1995 that provides important cautions regarding forward-looking statements. Cody, please go ahead.

Thank you. I'd like to remind everyone that in the course of this call, to give you a better understanding of our operations, we will be making certain forward-looking statements regarding our business and outlook. These statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from such statements. For information concerning these risks and uncertainties, see Concrete Pumping Holdings' annual report on Form 10-K, quarterly report on Form 10-Q, and other publicly available filings with the SEC. The company disclaims any intention or obligation to update or revise any forward-looking statements whether as a result of new information, future events, or otherwise. On today's call, we will also reference certain non-GAAP financial measures, including adjusted EBITDA, net debt, and free cash flow, which we believe provide useful information for investors. We provide further information about these non-GAAP financial measures and reconciliation to the comparable GAAP measures in our press release issued today or the investor presentation posted on the company's website. I'd like to remind everyone that this call will be available for replay later this evening. A webcast replay will also be available via the link provided in today's press release, as well as on the company's website. Now I'd like to turn the call over to the CEO of Concrete Pumping Holdings, Bruce Young. Bruce?

Thank you, Cody, and good afternoon, everyone. I'm pleased to report that although we experienced challenging winter weather conditions in our U.S. operations during the first quarter, We continue to deliver double-digit growth in our concrete waste management services and UK operations and maintain revenue growth on a consolidated basis. In the month of January, heavy rainfall, snow, and freezing temperatures across the United States brought many of our U.S. concrete pumping projects to a standstill. As a result, many of our customers' projects were delayed and job sites were closed. We estimate such weather events lowered the expected revenue volume of our concrete pumping work by approximately $7 million in January. However, work in February has recently returned to more normalized levels, and we are working closely with our customers to accommodate accelerated project schedules. In the first quarter, consolidated revenue increased by 4%, primarily driven by continued strong execution in our concrete waste management and UK operations. In fact, revenues for these segments increased by 14% and 21% year-over-year, respectively, and maintained their strong adjusted EBITDA margins. The performance of these two segments demonstrates the benefit of our diversification by end market and by service type. Additionally, despite the challenges we faced in this quarter, we are pleased with our ongoing efforts to improve the strength of our balance sheet. reducing our revolving ABL loan balance by approximately $6 million while maintaining liquidity at $217 million. Transitioning to our segments by end market, we continue to experience similar trends that we saw in our fourth quarter. In residential, the structural supply demand imbalance continues to grow, driving strong demand levels and increased activity among home builders. From a regional perspective, we see most development residential construction dollars being allocated within the mountain region in Texas, which represents undersupplied regions where single-family construction is prominent. While interest rates remain elevated, at this point we see no signs of slowing in this market due to the affordability imbalance that exists between purchasing a new home versus an existing one. We are optimistic that with expected interest rate cuts in 2024, we will capture additional tailwinds. In infrastructure, our expanded US national footprint continued to drive strong results as we captured more revenue from the public project investments. We continue to see more investment flowing to numerous projects where we operate, and we plan to aggressively pursue these project opportunities. In particular, growth across the UK continues to develop as HS2 and energy-related infrastructure spending has accelerated, and capital is being deployed at faster timelines than domestic U.S. government funding. Within the commercial end market, momentum in larger commercial projects like distribution centers, warehouses, semiconductor fabrication plants, and electric vehicle and battery manufacturing plants remain strong, underpinned by the growing reshoring trends here in the U.S., With regards to concrete pumping demand from light commercial projects, activity continues to be comparatively weaker as interest rate sensitivity and reduced availability of financing from smaller regional banks has stalled some projects. We continue to expect a recovery in the second half of fiscal 2024 as the project funding backdrop improves. Turning to the cost side of the business, the headwinds we experienced in Q4 largely continued into our first quarter, In addition to the downstream impact margins from adverse weather conditions, persistent inflationary pressures driven by a mix of labor and insurance continue to impact our ability to flow through our revenue performance to the bottom line margin. Such headwinds are expected to continue throughout 2024, but with our continued rate recalibration across all geographies and end markets, we anticipate a positive offset that should drive margin expansion over time. Our measures to recalibrate rates and the systems we are implementing to attract and retain employees are right in step for our business and to drive long-term shareholder value. I will now let Ian walk through more details of our financial results before I return to provide some concluding remarks. Ian?