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spk04: Thank you for standing by. This is the conference operator. Welcome to the Northwest Pipe Company second quarter 2022 earnings conference call. As a reminder, all participants are in listen-only mode and the conference is being recorded. After the presentation, there will be an opportunity to ask questions. To join the question queue, press star then 1 on your telephone keypad. Should you need assistance during the conference call, you may signal an operator by pressing star then zero. I would now like to turn the conference over to Scott Montross, President and CEO of Northwest Pipe Company. Please go ahead, sir.
spk01: Good afternoon and welcome to Northwest Pipe Company's second quarter 2022 earnings conference call. My name is Scott Montross and I am President and CEO of the company. I'm joined today by Aaron Wilkins, our Chief Financial Officer. By now, All of you should have access to our earnings press release, which was issued today, August 8, 2022, at approximately 4 p.m. Eastern Time. This call is being webcast and it is available for replay. As we begin, I'd like to remind everyone that the statements made on this call regarding our expectations for the future are forward-looking statements and actual results could differ materially. Please refer to our most recent Form 10-K, for a year ended December 31st, 2021, and in our other SEC filings for discussion of such risk factors that could cause actual results to differ materially from our expectations. We undertake no obligation to update any forward-looking statements. Thank you all for joining us today. I'll begin with a review of our second quarter performance. Aaron will then walk you through our financials in greater detail. Consolidated net sales were 118.5 million, which included 24.2 million contribution for our newest acquisition, Park USA. Revenue from our steel pressure pipe segment increased 31.2% year-over-year to 77.1 million. The increase was primarily due to higher project pricing, driven by strong bidding in early 2022, as well as higher steel prices. These factors were partially offset by lower production volumes, primarily related to product mix, as well as incoming steel quality issues that held up production and shipment of orders that were already in backlog. That said, our production volume is expected to steadily improve throughout the second half of 2022. Our steel pressure pipe sales have continued to benefit from the stronger bidding environment we've been experiencing this year compared to 2021, which as a reminder, was a very small bidding year, given the significant amount of bidding and project delays we experienced due in part to the pandemic. These delays pushed project bidding into 2022, which is why our backlog has remained in record territory throughout the first half of 2022. As of June 30th, our backlog, including confirmed orders for the steel pressure pipe segment, was $338 million, which was down only slightly from our all-time record of $341 million, as of March 31, 2022, and compared to $234 million as of June 30, 2021. As noted on our last call, we projected the first quarter would be the high watermark for our steel pressure pipe backlog in 2022, given the robust bidding activity that we experienced at the onset of the year. That said, we continue to expect bidding should remain solid throughout the second half of 2022. And as a result, backlog levels should also remain high compared to historical standards through the remainder of the year. We saw steel prices fall from highs we experienced late in 2021. Steel prices spiked again as the war in Ukraine put upward pressure on steel pricing in the March-April timeframe. Since then, we've fallen steadily into the low to mid $800 per ton range. Steel prices are still fairly elevated, by historical standards, but well off the $1,950 a ton high point we saw in late 2021. In general, elevated steel prices are good for our steel pressure pipe business. Sales from our precast segment increased 175.2% year-over-year to $41.4 million, driven primarily by aforementioned $24.2 million contribution from Park USA, which we acquired on October 5, 2021, along with an extremely strong $17.2 million revenue quarter from our pre-existing precast operations at the Geneva locations, which we acquired on January 31, 2020. The second quarter of 2022 was a record quarter for both Park USA and Geneva. Geneva's sales increased 14%, year over year through primarily to higher selling prices resulting from improving demand for our high-quality precast products along with increased raw material input costs. While demand remains strong, our production volume during the second quarter was hampered by a major unplanned equipment outage at our key cement supplier's plants in Utah, which temporarily restricted availability of raw materials. That supplier has since returned to more normalized production levels. Overall, the extremely strong precast market has led to tight cement supply for some time. In addition, we experience extended lead times on certain engineered system components such as pumps, valves, and meters that we purchase for the park locations. The continued strength of the precast related demand has dictated that we need to establish additional channels of raw material supply And as such, we have been able to identify additional avenues of cement and component supply in the various regions. Our precast related order book remains at all-time highs and totaled $74.5 million as of June 30, 2022, compared to $65.5 million as of March 31, 2022, and $23.7 million as of June 30, 2021, which does not include Park USA. we anticipate our precast order book will remain strong for the near term. Our consolidated gross profit increased 152.5% year-over-year to $24.1 million, which resulted in a gross margin of 20.3%, up approximately 740 basis points from the second quarter of 2021, which, as a reminder, was negatively impacted by COVID-related production delays and associated bidding pressure. As we expected, our steel pressure pipe margins improved into the mid-teens in the second quarter as we began to work through the newer, higher quality projects and backlog. For the third quarter of 2022, our underlying steel pressure pipe business is on track to generate similar revenue and improving gross margins. However, recent severe weather events in late July and early August forced a shutdown at both our Atalanto, California plant in our St. Louis, Missouri plant due to flooding, which may result in adverse impact to our results if the shutdowns become extended. As such, we are currently anticipating third quarter SPP revenue could be slightly down from the second quarter of 2022 with margins that are flat to up modestly. Once again, our precast margin significantly bolstered our consolidated gross margin in the second quarter. Aside from the sizable contribution from the acquired Park USA locations, we benefited from improved pricing at our pre-existing precast operations. Current economic inflationary pressures have driven increasing costs for raw materials and transportation, and therefore we've been very focused on staying ahead of those costs with our price increases. Partially offsetting the price increases were the aforementioned supply chain issues pertaining to cement availability during the second quarter, which affected precast production levels. Despite current economic headwinds, including rising interest rates and potential impact on commercial and residential construction, we are cautiously optimistic the precast business will remain strong for the near term. Next, I would like to turn to a discussion of our two-prong growth strategy. in which we are striving to better diversify and balance our business to be more resilient through economic cycles. First and foremost, we are focused on driving growth in the precast related space. The integration of Park USA is on schedule. We've recently been working to complete the last major piece of our integration effort with the ERP implementation. And we are continuing to refine both operational and commercial KPIs. Organic growth product spread strategy is now underway and we've been making good progress. As a reminder, by product spread we are referring to our initiative to add the production of park products to our legacy Northwest pipe plants. And in some cases, add products from existing Northwest pipe facilities to park facilities in order to expand our production and maximize overall efficiencies. During the second quarter, we continue to make progress in building out more capacity at our park plants in Texas. In addition, our bookings outside of Texas are up nearly 40% year over year, and we are progressing through the first phase of the product spread initiative. As we approach our next phase, we will be highly focused on training to share knowledge and best practices from Park USA with our employees at our pre-existing Geneva precast operations. We remain very excited about the potential of this acquisition. And in conjunction with the park integration work, We're working toward expanding and automating our Geneva operations to increase our production capabilities and capacity to satisfy the growing market demand for our concrete products. As previously announced, we have committed over $18 million in new capital improvement projects on this front, which includes a new RCP manhole facility at the Salt Lake City, Utah plant, on which we've spent $4.4 million so far this year, and a new batch plant in our St. George, Utah location, all of which remain on track for completion in the first half of 2023. Our goal remains for the precast-related business to grow to a similar size as our steel pressure pipe business within three years, supported by increasing infrastructure needs in the United States. The second prong of our growth strategy is to maximize our steel pressure pipe water transmission business to drive enhanced shareholder value, We will do this by continuing to focus on margin over volume, lean manufacturing, and cost reductions. These elements by now have been ingrained into our culture and serve as guiding principles to drive efficiencies at all levels of the company. We will continue to explore potential investment projects that help us reduce costs and maximize margins. Before I conclude, I'd like to discuss progress on some current and upcoming water transmission projects that are bidding in the steel pressure pipe market. The HR 3684 Infrastructure Investment and Jobs Act has been signed into law, adding $55 billion in federal funding for relevant water infrastructure projects over the next five years. In the eastern market, the ongoing multi-year, multi-agency Houston surface water program is expected to bid multiple segments in 2022, representing 15,000 tons of pipe for the West and North Harris County regional water authorities. We anticipate both authorities having additional projects representing 5,500 tons beyond this year. The next new reservoir to be built in Texas is Lake Ralph Hall for the Upper Trinity Regional Water District. This is another major program Currently in design, that includes a dam and pipeline to move water into the Dallas-Fort Worth Metroplex. The pipeline represents 17,000 tons of pipe. Construction on the dam began this year, and the pipeline is expected to begin late in 2022 or early 2023. The Alliance Regional Water Authority Program in Central Texas is another multi-agency regional water program. This program includes a large pipeline, pump stations, and treatment facilities and represents 4,000 tons of pipe on the remaining segments. Construction started in 2021 and appears to be holding to the forecasted timeline. In North Dakota, progress continues on the 140 mile, 87,000 ton Red River Valley water supply project. The first two segments were awarded to Northwest Pipe and installation is currently underway. We are closely tracking the outcome of further budget approval for future segment construction. In the western markets, California Prop 1 $7.5 billion for water infrastructure has created much needed funding for projects within the state. The following Prop 1 projects are expected to start construction in the next five years. The site's reservoir is a water storage program that will involve over 30 miles of 144-inch pipeline. Harvest Water is a program intended to provide recycled wastewater for agricultural use in the Sacramento area. This program includes nearly 25 miles of 30-inch to 66-inch pipeline. The Los Vaqueros Reservoir Expansion Program provides a substantial capacity improvement to the existing reservoir and conveyance facilities in Northern California. The program includes approximately 22 miles of 48- to 96-inch pipe. Willow Springs Water Bank will create 500,000 acre feet of underground water storage in the Antelope Valley. The project includes approximately 16 miles of 30 to 84-inch pipe. Water reuse programs have generated new opportunities in the California market on which we expect to see bidding activity continue for the foreseeable future. MWD is heading a regional reuse pilot project in conjunction with the L.A. Sanitation District. This reuse program will treat and recycle water from one of the largest reclamation facilities in Southern California and involves 60 plus miles of large diameter pipe. The current demonstration facility has been operating for almost two years. Preliminary design and permitting is ongoing and construction of the full-scale treatment and conveyance facilities will begin as early as 2025. MWD secured a $224 million WEFA loan in October of 2021, which will fund nearly 50% of the anticipated construction costs. Southern Nevada Water Authority, a Las Vegas water wholesaler and Colorado River water user, has also pledged significant financial support for this program. The MWD PCCP Rehabilitation Program will result in about 5,000 tons annually over the next 10 to 15 years. This program includes 81 miles of pipe from 75 to 120 inches in diameter. The Southern Nevada Water Authority has begun moving forward in earnest with the expansion of the southern part of their water delivery system. This program, which has recently started preliminary design activity, will include approximately 25 miles of 78-inch steel pipe with construction tentatively scheduled for 2024. In Utah, design and permitting continues on the 150-mile, 69-inch Lake Powell pipeline. This pipeline will provide an alternative source of water for southern Utah. Construction is proceeding in earnest in New Mexico on the U.S. Bureau of Reclamation's Navajo Gallup Supply Project. The final major phase of pipeline construction for this program is expected to bid toward the end of this year and include 4,700 tons of steel pipe. New Mexico Governor Grisham recently announced $160 million in the IIJA funding for the Eastern New Mexico Rural Water System. This 20,000-ton program will convey water via steel pipe from the Ute Reservoir in northern New Mexico south to water users in the greater Clovis area. In summary, we are very pleased with our second quarter performance, resulting from outstanding execution in our precast business that led to a record precast quarter, along with ongoing strength in steel pressure pipe bidding activity that led to improving results for the steel pressure pipe business. We are maintaining a positive outlook for the second half of 2022. While a third quarter steel pressure pipe revenue is expected to be down slightly as a result of Atalanta and St. Louis plant flood related shutdowns, we expect our margins to be flat to up modestly as the underlying business remains fundamentally solid. Supported by strength in our SPP backlog, as well as our precast order book, both of which are expected to continue for the near term. We continue to estimate that steel pressure pipe bidding activity could be approximately 50% higher for 2022 compared to 2021 levels. Looking ahead, we will remain focused on our top priority of taking every precaution to keep our employees safe through the ongoing pandemic. Two, integrating Park USA as quickly and efficiently as possible. Three, a persistent focus on margin over volume. Four, continuing to implement cost reductions and efficiencies at all levels of the company. And number five, continuing to identify strategic opportunities to grow the company once we've completed the integration work with Park USA. Thank you to all of our Northwest Pipe employees for your strong performance during the quarter and your commitment to working safely. I will now turn the call over to Aaron, who will walk through our financial results in greater detail.
spk02: Thank you, Scott, and good afternoon, everyone. I'll begin with our second quarter's profitability. Consolidated net income was $9.7 million, or $0.97 per alluded share, compared to $2.1 million, or $0.21 per alluded share, in the second quarter of 2021. Our consolidated net income in the second quarter of 2022 included $0.8 million in amortization expense and other transaction costs specific to Park USA. These items, net of $0.2 million in associated tax expense, resulted in adjusted net income of $10.3 million in the second quarter of 2022, or $1.04 per alluded share. This compares to $2.2 million, or $0.22 per alluded share, in the second quarter of 2021. Adjusted net income is provided for comparability purposes. Please refer to the reconciliation of non-GAAP financial measures in our earnings release for a comprehensive schedule detailing the adjustments for each period. Consolidated net sales increased 60.6% to $118.5 million compared to $73.8 million in the second quarter of 2021. Steel pressure pipe segment sales increased 31.2% to $77.1 million compared to $58.7 million in 2021, driven by a 35% increase in selling price per ton, resulting in increased steel costs along with changes in product mix, which were partially offset by a 3% decrease in tons produced, resulting from changes in project timing. Freecast segment sales increased 175.2% to $41.4 million compared to $15.1 million in the second quarter of 2021, primarily due to a $24.2 million contribution from the recently acquired Park USA operations. This is in addition to a 14% increase in sales at our pre-existing precast operations, resulting from a 54% increase in selling prices on continued strong demand for our concrete products and increased raw material input costs, which were partially offset by a 26% decrease in volume shipped due to changes in product mix. Due to the unique nature of the precast products we manufacture, Production volumes and the corresponding sales prices do not always provide comparable metrics between periods. They are highly dependent on the composition of the mix of the products shipped. Consolidated gross profit increased 152.5% to 24.1 million or 20.3% of sales compared to 9.5 million or 12.9% of sales in the second quarter of 2021. Steel pressure pipe gross profit increased 67.9% to $11.1 million or 14.4% of segment sales compared to $6.6 million or 11.3% of segment sales in the second quarter of 2021. Our steel pressure pipe gross margin improved in line with our expectations largely due to changes in product mix as well as higher selling prices. Precast gross profit increased 343.9% to $13 million, or 31.3% of precast sales, from $2.9 million, or 19.4% of segment sales in the second quarter of 2021, primarily due to the contribution from Park USA, as well as higher prices at our pre-existing precast operations. Selling general and administrative expenses increased 59.8%, to $10.1 million or 8.5% of sales compared to $6.3 million or 8.6% of sales in the second quarter of 2021. The increase was primarily due to the addition of Park USA, which added $1.8 million in compensation-related costs along with $0.8 million in higher amortization expense. We also incurred an additional $0.9 million in higher company-wide compensation-related expense compared to the second quarter of 2021. For the full year 2022, what we now expect are consolidated selling general and administrative expenses to be in the range of $38 and $42 million. Company-wide depreciation and amortization expense was $4.2 million in the second quarter of 2022 compared to $3.4 million in the second quarter of 2021. We continue to expect appreciation and amortization will be in the range of $16 and $19 million for full year 2022. Interest expense increased to $0.9 million in the second quarter of 2022 compared to $0.3 million in the second quarter of 2021. As we are expecting to see continued upward pressure on variable interest rates for the balance of the year and into 2023, we have executed an interest rate swap covering approximately 40% of outstanding borrowings at the end of the second quarter. Our 2022 second quarter income tax expense was $3.4 million, resulting in an effective income tax rate of 26.1%, compared to $0.8 million in the second quarter of 2021, resulting in the same tax rate. The effective income tax rate for both quarters were impacted by non-deductible permanent differences. We believe our full year 2022 tax rate will be in the range of 25 to 26%. Now transitioning to our financial condition. Our improved profitability helped us generate net cash provided by operating activities of 8.5 million during the quarter compared to 5.6 million in the second quarter of 2021. Our capital expenditures for the second quarter totaled 4 million. compared to 2.9 million in the second quarter of 2021. We project our total capex to be in the range of 23 and 27 million for full year 2022, which includes approximately 9 million investment capex for the new reinforced concrete pipe mill, as well as standard capital replacement projects. Regardless of an increase in expected capital spending, We are currently expecting to generate between $12 and $16 million in free cash flow in the second half of 2022. Cash generated will be used to pay down outstanding debt. As of June 30, 2022, we had $86.7 million in outstanding borrowings on our credit facility, leaving approximately $37 million in additional borrowing capacity. In summary, I'm very pleased with our second quarter financial results. Our precast business outperformed our second quarter expectations and demand for that business has remained very strong into the third quarter. This, coupled with solid pricing and continued strong demand for our steel pressure pipe products, has resulted in the company achieving its highest quarterly revenue and gross profit levels in 13 years. I'd like to thank all of our employees for their dedication to executing our growth strategy, which recently included the system integration cutover for Park USA. We remain committed to executing our strategic priorities to drive long-term growth and enhance shareholder value in 2022 and beyond. Finally, I'd like to encourage our employees to continue their focus on workplace safety by keeping themselves and each other safe. I will now turn it over to the operator to begin the question and answer session.
spk04: Thank you. We'll now begin the question and answer session. to join the question queue, you may press star then one on your telephone keypad. You'll hear a tone acknowledging your request. If you're using a speakerphone, please pick up the handset before pressing any keys. To withdraw your question, please press star then two. We'll pause for a moment as callers join the queue. Our first question is from David Wright with Henry Investment Trust.
spk00: Please go ahead. Hey, good afternoon, Scott and Aaron. It must be pretty gratifying for you and the team to see these results from the precast acquisitions. Congratulations.
spk01: Well, thank you, David. Good to talk to you.
spk00: Let's talk about steel pressure pipe margins. A couple years ago, you pulled some quarters with margins in the upper teens. The last several quarters, they've been fluctuating between 12% and 15%. You've indicated in the text today that they could be higher in the second half of the year. But is it possible under your... under your current model of, um, of, uh, margin over volume to actually get back up to the upper teens?
spk01: Uh, yeah, I think that, uh, that's kind of the direction we're heading. I would say that the quality of backlog that we have in steel pressure pipe right now is pretty good. Um, and I think as Aaron covered, or we said in the script, we had, uh, We had some incoming steel that didn't fit the quality that we needed for some of the jobs that we had. So it took probably 3,000 or 4,000 tons out of our production in the second quarter, which obviously affected our gross margin percentages. with the overhead absorption you would get by the extra tons. So we do think that we are in a position to begin moving up into those high teens as long as the market stays strong. Now, like we said about the second quarter, unfortunately, the last couple of weeks, we've had some pretty significant weather events in different parts of the country. One of them was in St. Louis where we actually had a lot of water in our St. Louis plant, but they're back up and running some work centers right now, and they started shipping. So they should have everything operating by next week, but we've had to bring in trailers for administration buildings because of some of the water damage that was done to the office building there. So we're probably looking at probably a couple weeks disruption for that, and that's relatively small volume. The bigger one that we were more concerned about was the Adelanto facility. We had very heavy rains down there about a week ago and actually a lot of flash flooding in the area where we had the plants and the plant and got some water in the plant and in the process pits. But they did a good job of getting that cleaned out and then we're only down a couple of days. So probably going to be minimal impact by the weather on the Adelanto plant. But we're always a little bit cautious. when we've got events like this, David, because Atalanta plant is one of our major plants, and you never know what you're going to run into after a weather event like that with motors and the electronics and things like that. So we're being a little bit cautious, but the team has gotten those plants up and running very quickly, and we're pretty happy about that. So that should bode well, hopefully, for the margins as we go into the third quarter. Uh, you know, we've only been able to update these as fast as we're getting information on these things. So it's changing by the day. So ultimately I think the Atalanta facility is going to be down less time than we, we, we originally thought. So that'll also be good for the margins as we go into the third quarter.
spk00: Okay. Um, do you, you've indicated third quarter can be similar to second quarter. Um, Do you have that kind of visibility into the fourth quarter as well?
spk01: Yeah, we do. I mean, it gets a little bit fuzzier. But, I mean, our backlog on steel pressure pipe is, you know, we're sitting at relatively an all-time high. We're at $338 million worth of backlog. So everything that we're going to produce pretty much is already in backlog. So it's just a matter of getting that produced. And like I said, the quality of that backlog is really good from the bookings and the strength of the bookings early this year. So that looks like to be an area of we're going to be gaining strength as we go from the third quarter into the fourth quarter. But it is generally the slower time of the year where you can actually run into weather events still. You know, barring any of that sort of thing, the backlog is really a good backlog on the steel pressure pipe side. You know, on the precast side, we've got $75 million worth of order book on the precast side, and that really is, you know, a half a year or better of backlog for the precast side. And, again, that backlog, like the steel pressure pipe backlog, is a really high-quality backlog. I think the group has done a great job on the costs on the precast side, and the operating guys have done a great job on the costs on the precast side, and the sales guys have done a really good job of staying ahead of the raw material costs and making sure that we're getting those price increases into the market in front of the raw material costs so the margins aren't being affected by that. You know, I think as we go into the fourth quarter, the third and the fourth quarter, precast is going to remain pretty strong based on the way that the order book looks right now. But also when you get into the fourth quarter of the year for precast, that's the slower time of the year. But I would say in both cases on steel pressure pipe and on the precast side with the strength of the backlog, things look pretty solid in the second half of the year.
spk00: Great. Let me sneak one more in here. You mentioned the product spread strategy, which in past calls you've spoken with it as something kind of out into the future once you complete all of the integration. But in your comments today, you sort of inferred that maybe a little bit of that is starting. Can you elaborate?
spk01: Yeah, there's really three phases to that, David. The first phase was taking what we acquired with the park facilities and making sure that we build out the facility usage there, especially in the San Antonio plant and the Ferris plant. The Houston plant is the big park plant. So if you look at what the team has done with the bookings-wise this year in Houston and San Antonio, they're up 15% over where they were, actually more than 15% over where they were last year, which was the first phase. The second phase was for us to start booking business outside of the state of Texas, and that's up about 40% versus where we were last year. And we're doing that in readying to start the second phase, which is the training at our Geneva facilities to be able to install the equipment in the precast vaults that PARC installs down in Texas to have Geneva produce the vaults and install them in Utah and ship them into the Utah area and surrounding areas, Idaho and Nevada. So that's something that we're quickly running into right now because we're in the process of looking at orders for the Utah facilities right now to get that going. So that's moving a little bit more quickly than we thought it would at this point because I think the team is doing a good job on that and And the product development people are doing a really good job on that. And the third phase is ultimately being able to spread the park products to other locations, such as the steel pressure pipe plants in different locations and getting set up to do that. I think that's more of the longer-term thing. But we're definitely making progress on phase one and phase two right now. So good progress.
spk00: All right, well, that's a nice update. Thanks for taking my questions and best of luck.
spk02: Always good to talk to you, David. Thanks, Ed.
spk04: The next question is from Jean Ramirez with DA Davidson.
spk05: Please go ahead. Mr. Ramirez, your line is open. Mr. Ramirez, your line is open.
spk03: Sorry for that. I'm not sure what was happening. Good afternoon. This is John Ramirez for Brent Dillman and Dave Davidson. How are you? Good. How are you? Good to talk to you. Good. So for my first question, just wanted to know, with all the release work and industry capacity timing, are you seeing any improved bid margins? for the second half?
spk01: Yeah, I think that the one thing about the backlog and the margins, and obviously the backlog is large right now. So early in the year, you have the holdover on the margins. Like in the first quarter, our margins were, I can't remember exactly what they were, like 11% in that area. Well, you were dealing with some holdover work from 2021, which had a very small bidding year. and a lot of a lot of bidding pressure on every job the beginning of 2022 we had a huge bidding market in in really the first four months of the year actually three and a half months of the year over 50 000 tons of uh of projects big during that time period so when you get that much stuff bidding at one time these projects all over overlap so if if somebody's getting one project they're not going to be able to continue to take more projects because a lot of these projects are being produced at the same time. And as a result, the bidding pressure on these jobs get relieved, and ultimately the margins on those jobs will improve. So we are definitely seeing that in our backlog as we go through the second quarter and into the third quarter of the year, definitely the last half of the year, with what we have in our backlog right now. So, yes, the quality of backlog that we have right now is fantastic. continuing to improve as we go into the second half of the year.
spk03: Thank you. And if I could do a follow-up, could you provide some color and how cement capacity constraints impacted your precast thickness? Just a little more. We would like to know.
spk01: Yeah. In the second quarter in Utah, the Geneva facilities in the state of Utah, We had one of our major cement suppliers have a big equipment issue during that quarter, so the cement supply was limited in the quarter, especially at Geneva. We are also seeing similar situations in the state of Texas. Obviously, we buy cement to make the precast vaults at the park facilities where there's cement suppliers that are putting people on allocation just because the precast market has been so strong that the demand for cement is so high. But I think our biggest impact probably in the second quarter was the impact that it had on the Geneva locations when we had the issue at our major supplier. And it probably affected our revenue at the Geneva facilities, probably between $1.2 million and $1.5 million for the quarter. I would say that's a pretty good guess. We were looking at that the other day just to make sure that we had that straight. But it did have an impact. The cement supplier is back to normal production and shipment levels now, so it's not occurring. But as we said in the script, we've been pretty busy looking at alternative suppliers just to make sure if it happens again that we have different and more avenues to go down to fill the supply out.
spk03: Great. Thank you so much. I appreciate the responses and all the color. I'll jump back into the queue.
spk05: Thank you. Once again, if you have a question, please press star then one.
spk04: As there appears to be no further questions, I'd like to turn the conference back over to Scott Montross for any closing remarks.
spk01: Yes, I'd like to thank everyone for joining the call today and just leave you with a few key takeaways. Obviously, the backlog that we have in our steel pressure pipe business is some of the highest backlog that we've seen, both from a dollar perspective and a tons perspective. And like I said during the script, We expect that backlog with the bidding that we have throughout the year to remain relatively high by historical standards. We still think the first half of the year is a high watermark, but by historical standards, that backlog is going to remain pretty strong. And, you know, when you look at the infrastructure bill that was signed, the Infrastructure Investment and Jobs Act, it's putting forth another $55 billion for water-related, and we've seen some of that already. start in the job in New Mexico that we talked about in the script. And there's another $50 billion out there for resiliency, which handles drought situations and infrastructure build-out, in this case, directed toward the western United States. So we think that's going to create some additional strength in our market going forward on the steel pressure pipe side. On the precast side, again, the order book is very, very strong. And I guess we worry about the inflationary pressures that we see and the Fed's action in raising the interest rates. And obviously, if they continue to raise the interest rates, that will slow the business down. But what we're seeing right now is a very, very strong market in Texas with our park facilities that has remained strong and actually is continuing to get stronger. And we're continuing to see strength in our Geneva infrastructure precast order book in and around Utah. And I think that's generally related more toward the supply chain buildup that happened during the pandemic and the lengthening of the supply chain and delays of getting houses built and things like that. So there's a lot of backlog of houses to be built in Utah. I think Ultimately, I'd like to say finally we're really excited about the future potential of the park business as we continue to make progress on the integration front. We look forward to continuing what we're doing in the product spread business. So I think we've got a lot of good runway in front of us. I'd like to thank everybody for their time and attention today, and we look forward to speaking with you again on our third quarter call in November. So thank you very much.
spk04: This concludes today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.
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