Great Lakes Dredge & Dock Corporation

Good day, and thank you for standing by. Welcome to the Q2 2024 Great Lakes Drudge and Doc Earnings Conference Call. At this time, all participants are in listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you need to press star 1 1 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 1 1 again. Please be advised that today's conference is being recorded. I would now like to hand the conference to your first speaker today, Tina Baginskis, Director of Investor Relations. Please go ahead.

Thank you. Good morning and welcome to our second quarter 2024 conference call. Joining me on this call this morning is our President and Chief Executive Officer, Lassa Pettersson, and our Chief Financial Officer, Scott Kornblau. LASA will provide an update on the events of the quarter, then Scott will continue with an update on our financial results for the quarter. LASA will conclude with an update on the outlook for the business and market. Following their comments, there will be an opportunity for questions. During this call, we will make certain forward-looking statements to help you understand our business. These statements involve a number of risks, uncertainties, and other factors that could cause actual results to differ materially from our expectations. Certain risk factors inherent in our business are set forth in our earnings release and in filings with the SEC, including our 2023 Form 10-K and subsequent filings. During this call, we also refer to certain non-GAAP financial measures, including adjusted EBITDA, which are explained in the net income to adjusted EBITDA reconciliation attached to our earnings release, and posted on our investor relations website along with certain other operating data. With that, I will turn the call over to Lassa.

Thank you, Gina. Great Lakes Dredge and Dock delivered solid second quarter results driven by excellent project performance, well-executed dry dock program, and disciplined cost control. For the second quarter, we achieved net income of $7.7 million and adjusted EBITDA of 25.8 million. This is a very strong result considering we had three dredges in dry dock in preparation for the new capital LG projects, which have commenced in full now in the third quarter. With a record 2024 US Army Corps of Engineers budget of 8.7 billion, the bid market has been robust for the first half of the year, and is expected to remain so for the rest of the year, particularly in our prime markets for capital port deepenings and coastal protection projects. The robust bid market has enabled us to keep our dredging backlog strong, replacing most of the revenue burn-off in the first half of the year. At the end of the quarter, our firm dredging backlog stood at $807.9 million, with 85% of that in capital projects. In addition, we had $273.1 million in low bids and options pending award. Post quarter end, we have continued to be the low bidder on new dredging projects with pending awards for approximately $181.6 million. Additionally, for offshore wind, our backlog was $44.6 million with an additional $12.7 million in options pending award. On the LNG-related projects, the Port Arthur LNG Phase 1 Channel Improvement Project and the Brownsville Ship Channel Project for next decade cooperation, the Rio Grande LNG Project, we are fully mobilized. And the main dredging work will now be in full swing in third quarter and continue into 2025 and 2026. The Biden administration's temporary pause on approving new LNG export licenses has not had an impact on our two awarded projects. There has also been minimal impact on the large number of projects that the Department of Energy has already approved and on which we continue to tender bids. The continuation of these private sector projects greatly support our dredging business by diversifying and expanding our client base. Modernizing our fleet is a key factor in staying a competitive market leader for the long term, and we have made significant progress on our new building program with the first quarter delivery of our newest 6,500 cubic yard capacity hopper dredge, the Galveston Island. The vessel went from shipyard through commissioning and sea trials to being in full operation in record time, and she contributed strongly to the solid project performance in the second quarter. Her sister ship, the Amelia Island, is currently under construction and is expected to be delivered in the second half of 2025. These dredges have been specially designed to operate on projects that redevelop and improve our beaches and shorelines, which are subjected to continual damage due to storms and rising sea levels. The first and only U.S. flag Jonesair-compliant inclined four-pipe subsea rock installation vessel, the Arcadia, is currently under construction at the Philly shipyard. The Arcadia is contracted to install rock foundations for Equinor's Empire Wind 1, scheduled for a 2025 start, and to perform rock placement to protect subsea cables on the Ørsted Sunrise Wind project, scheduled for 2026. In addition to the US offshore wind market, there are several other markets opportunity that the Arcadia is well suited for. She can work in the international offshore wind market, she can work in the oil and gas and carbon capture market, and the telecommunications and power cable markets, installing rock protection over pipelines and cables. We have pre-qualified and tendered on a number of rock placements projects for the Arcadia, both in the US and internationally, We work plan for 2026 and beyond. In the second quarter, we entered into a $150 million second lien credit agreement for an aggregate principal amount of $100 million and a delayed draw term loan facility in the aggregate amount of $50 million to provide additional liquidity to support a new bill program, and provide financial flexibility to pursue other financing alternatives, including MARAD's Title XI. I will now turn the call over to Scott to further discuss the results of the quarter, and then I'll provide further commentary around the market and our business.