L.B. Foster Company

Good day and welcome to the first quarter 2022 LB Foster earnings conference call. After the speaker's presentation, there'll be a question and answer session and instructions will be given at that time. As a reminder, this call is being recorded. I would like to turn the call over to Stephanie Liswack, the company's investor relations manager. You may begin.

Thank you, operator. Good morning, everyone, and welcome to LB Foster's first quarter of 2022 earnings call. My name is Stephanie Listwalk, the company's investor relations manager. Our president and CEO, John Castle, and our chief financial officer, Bill Tallman, will be presenting our first quarter operating results, market outlook, and business developments this morning. Sean Riley, the company's corporate controller, is also joining us this morning. We'll start the call with John providing his perspective on the company's first quarter performance and updating you on significant business matters and market developments. Bill will then review the company's first quarter financial results. John will then provide perspective on company outlook and his closing comments. We will then open the session up for questions. Today's slide presentation, along with our earnings release and financial disclosures, were posted on our website this morning and can be accessed on our investor relations page at lbfoster.com. Our comments this morning will follow the slides in the earnings presentation. Some statements we are making are forward-looking and represent our current view of our markets and business today, including comments related to COVID-19. These forward-looking statements reflect our opinions only as of the date of this presentation, and we undertake no obligation to revise or publicly release the results of any revisions to these statements in light of new information, except as required by securities laws. For more detailed risks, uncertainties, and assumptions relating to our forward-looking statements, please see the disclosures in our earnings release and presentation. We will also discuss non-GAAP financial metrics and encourage you to read our disclosures and reconciliation tables provided within today's earnings release and within our accompanying earnings presentation carefully as you consider these metrics. For the purpose of helping you understand the underlying performance of the company, we will be referring to adjusted EBITDA, adjusted net income, adjusted diluted EPS, net debt, and adjusted net leverage ratio during the presentation today as reflected in the reconciliation tables included in the appendix to the earnings presentation. Additionally, In September of 2021, he announced the asset sale of our Piling Products Division. Due to the nature of the sale, we have presented the Piling Products within continuing operations within our financial statements, but we have adjusted certain metrics, as annotated in our presentation slides, to reflect the sale for purposes of an even comparison. So, with that, let me turn the call over to John.

Thanks, Stephanie, and hello, everyone. Thanks for joining us today for our first quarter earnings call. I'll start the call with some opening remarks on developments within the business in Q1. Despite headwinds we face in the quarter, overall we are encouraged by some of the positive trends realized by the business. Specifically, order intake levels excluding the pilings business increased 17.7% over the prior year quarter and increased 42.2% sequentially. This order intake level resulted in a backlog of $245 million at quarter end, an increase of 3.7% compared to prior year quarter. The strength in orders and our current backlog should position us well for improving revenues as 2022 progresses, including expected sequential increase of at least 25% in Q2. Reflecting the improving commercial environment, we also delivered year-over-year revenue growth in Q1, which was up 3.7% versus last year after adjusting for the piling sale. While the commercial markets have continued to improve, the operating environment remains challenging, and our margins were impacted by inflationary pressures and disruptive supply chains in the quarter. However, our margins began to stabilize in the quarter, and we expect to see improvements in the profitability in the coming quarters as volumes continue to improve and our mitigation actions take hold. Working capital levels are elevated versus last year, with the expected improvement in revenues ahead and efforts to ensure product availability for customers in the challenging supply market. We remain focused on our strategy to leverage our key growth platforms. Precast concrete and rail technologies and services will be making our progress on our execution roadmap. So while we are facing challenges in the quarter, we believe the potential upside in our markets and focus strategy will have us well positioned to drive improved shareholder returns in the coming years. Bill will cover the detailed financials for Q1, and I'll come back at the end with some closing remarks on our outlook. Over to you, Bill.