Gulf Island Fabrication, Inc.

Good afternoon, ladies and gentlemen, and welcome to Gulf Islands Conference Call to discuss first quarter 2024 results. All participants will be in a listen-only mode for the duration of the call. This call is being recorded. At this time, I would like to turn the floor over to Ms. Cindy Cook for opening remarks and introductions. Cindy, please go ahead.

Thank you, and good afternoon. I would like to welcome everyone to our first quarter 2024 teleconference. Our results were released this afternoon and a copy of the press release is available on our website at gulfisland.com. A replay of today's call will be available on our website after 7 p.m. this evening. Please keep in mind that the press release and certain comments on this call include forward-looking statements and actual results may differ materially. We would like to refer everyone to the cautionary language included in our press release and to the risk factors described in our most recent Form 10-K and subsequent SEC filings. Please also note that management may reference EBITDA, adjusted EBITDA, adjusted revenue, new project awards, and backlog on this call, which are financial measures not recognized under US GAAP. As required by FCC rules and regulations, to the extent used, these non-GAAP financial measures are reconciled to their most comparable GAAP financial measures in our press release. Today, we have Mr. Richard Hough, President and CEO, and Mr. Wes Stockton, Executive Vice President and CFO. Mr. Hough?

Thank you, Cindy. Good afternoon, everyone. And welcome to our first quarter results conference call. I'm happy to be here with you this afternoon, and I hope that each of you and your families are continuing to stay healthy and safe. During today's call, I'll provide key takeaways from the quarter, a review of segment performance and in-market trends, an update on the progress we have made on our strategic initiatives. Wes will then discuss our first quarter results in greater detail and provide some commentary on our outlook for 2024. We'll then open up the call for questions and end with some closing remarks. The positive momentum we experienced during 2023 has carried into the new year as we posted another quarter of solid operating results and strong operational execution. We continue to make important progress on our strategic initiatives, putting us in a strong position to take advantage of the favorable in-market trends in our core Gulf Coast region. Based on these positive trends combined with our expectation for continued execution against our key initiatives, we are up optimistic regarding the business outlook and remain on track to achieve our full year 2024 financial targets. Another important highlight from the first quarter was our strong financial position exiting the quarter. Wes will cover our balance sheet and liquidity in more detail, but we are very encouraged by our strong balance sheet with quarter ending cash of over $61 million. This gives us ample financial flexibility to pursue both organic and inorganic growth objectives. Now turning to our segment results. First, looking at our services division, our first quarter revenue increased 18% year over year driven by continued strength in our offshore services markets, including further momentum in our spark safety business. The demand environment for our key oil and gas customers remain favorable, as our customers are generating strong profitability leading to a healthy maintenance capital spending environment. We are pleased with the continued traction for our SPARC safety services offering as we continue to expand the base of new customers. The biggest challenge in our services business remains the ability to attract and retain craft labor. As a result, we remain focused on retaining our employees and finding creative ways to attract and develop new talent, including through M&A, similar to our acquisition of Dynamics. That said, we remain encouraged by the trends in our services business and continue to expect a strong year in 2024. Now, moving on to fabrication, our reported revenue declined from last year, but this was entirely driven by the benefit of our large fabrication project and last year's results. The strong momentum in our small fabrication business continued during the first quarter as we saw solid year-over-year growth and strong execution in this business. The demand trends in our legacy fabrication markets remain positive, including the opportunities we have discussed previously in the subsea market. A key aspect of our strategic plan is to target in markets outside of our traditional oil and gas markets. We have discussed the potential in adjacent markets such as LNG and petrochemical, and we continue to see attractive opportunities in these markets. We also continue to pursue new end markets where we can take advantage of our history of strong execution and our strategic location. Our contract for the fabrication of structural components for NASA which was a key contributor to our strong growth in small scale fabrication during the first quarter, is an example of the opportunity to expand our in-market focus. We are seeing that these in-markets place a premium on quality and schedule certainty, areas where Gulf Island is more than capable of delivering. As a result, we believe we are in an attractive position to pursue these new in-markets. We continue to pursue several attractive large fabrication projects. However, the regulatory uncertainty and uneven interest rate outlook is in many cases extending the decision cycles and timelines of many of the large projects we are pursuing. We remain bullish on the potential for large fabrication awards, but the ability to protect timing is getting much more challenging. However, given the meaningful growth in our small scale business, we are now much less dependent on large awards. The strong market trends in our existing markets, as well as our opportunities in new end markets, combined with the tight fabrication capacities give us confidence we're well positioned for growth in fabrication. Finally, turning to our shipyard division, as we highlighted on our last call, we wrapped up our remaining operational shipyard obligations during the first quarter. with the warranty period for our ferry projects being the final remaining items associated with the wind down of the business. We are pleased to have the wind down in the shipyard behind us and are excited to put all of our energy and focus to growing our services and fabrication businesses. To that end, we have increased our efforts to identify strategic partnerships and acquisition opportunities. With our more stable fabrication and services platform, Combined with our strong financial position, we are ideally situated to pursue strategic partnerships and acquisition opportunities that will enable us to grow our existing platform, expand our current capabilities, and further penetrate new growth markets. As we have done throughout our strategic transformation process, we will remain disciplined in our pursuit of both organic and inorganic growth opportunities. We're very pleased by our strong start to the year, which was highlighted by the continued momentum in our services and small-scale fabrication businesses. These businesses combine to form a more stable and profitable base of business, which together with our strong financial position gives us an attractive platform to pursue our growth objectives. Our successful execution of our strategic objectives has put us in a strong competitive position and we are excited by the opportunities we see in front of us. I will now turn the call over to Wes to discuss our quarterly results in greater detail.