Willdan Group, Inc.

Greetings. Welcome to Will Dan Group's second quarter 2025 Earnings Results Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Al Keshok, Vice President. Thank you, sir. You may begin.

Good afternoon, everyone, and welcome to World End Group's second quarter 2025 earnings call. Joining our call today are Mike Bieber, President and CEO, and Kim Early, Executive Vice President and CFO. Our conference call remarks will include both GAAP and non-GAAP financial results. Reconciliations between GAAP and non-GAAP measures can be found in today's press release and in the presentation slides, all of which are available on our website. Please note that year-over-year commentary or variances on revenue, adjusted EBITDA, adjusted EPS discussed during our prepared remarks are on a national basis. We will be making forward-looking statements about our performance. These statements are based on how we see things today. We may elect to update these forward-looking statements at some point in the future. We do not undertake any obligation to do so. As described in our SEC filings, actual results may differ materially to risk and uncertainties. With that, I'll hand the call over to Mike, who will begin on slide two.

Thanks, Alan. Good afternoon. We had another strong quarter of performance, capping a record first half in 2025. In the second quarter, we continued to execute very well, delivering results that exceeded the street expectations and our own forecasts. across revenue, adjusted EBITDA, and EPS. Our formula for catalyzing organic growth with the capabilities of new acquisitions is working. Against a strong Q2 last year, net revenue grew 31% year over year, driven by an outstanding 23% organic growth rate and 8% acquisitive growth. Performance remains strong across all business lines, reflecting the consistency of our execution and the value of our integrated model. With electric load growth expected to increase over the next decade, driven by data centers and electrification, Bulldog's differentiated capabilities position us well to sustain long-term growth. As a result, we're raising our full-year financial targets, which Kim will present a little later. Starting at slide three. Woodland delivers a broad range of energy and infrastructure solutions to commercial customers, utilities, and state and local governments. The energy segment makes up about 85% of our revenue, while our legacy engineering and consulting work makes up about 15%. Demand remains healthy across all customer groups. The 15% of work for commercial customers is mostly centered around electricity usage at data centers. where AI-driven load growth is creating significant demand. LILDAN is helping technology clients navigate energy constraints, optimize infrastructure, and meet aggressive power requirements. Our utility business makes up about 41% of revenue and continues to perform well. Most of our utility contracts are three to five years in duration, funded by ratepayer fees, and continue to provide a strong foundation of recurring revenue. The size of our long-term utility programs is generally increasing across the country as we perform well versus competitors, and energy efficiency becomes a power resource. Work for state and local governments makes up 44% of revenue and continues to grow organically at a double-digit pace. Demand from our government customers remains solid, and the outlook is positive. Most of our government work is funded through user fees and municipal bonds, which have remained stable. On slide four, our upfront policy and data analytics work informs World End Strategy and helps us navigate market change. In our upfront work, we see particular demand for integrated resource planning and asset valuation on projects associated with data center electricity load. Our upfront work has increased organically at a rate of about 50% this year. These market changes led us to the APG acquisition, which we announced in March, that provides deeper solutions for these clients. In engineering, we saw strong execution and growth, particularly with municipal customers. In program management, we performed above our plan on utility programs and building energy programs for cities. Putting this model to work on the right, as an example, we're hired by technology hyperscalers and their partners to help identify the optimal sites for data centers. This quarter, we rolled out a new proprietary software that we use to help clients site data centers. We think this new software tool is a significant differentiator and provides our clients with minimized interconnect times, lower power and land option costs, and faster speed to market. We then provide clients consulting, engineering, and project management to supply the electricity that powers data centers. The new generation of data centers requires high voltage power, often hundreds of megawatts, with a dedicated utility-scale substation and utility interconnect. After a data center is built, we'll then provide energy optimization inside the data center, as we've done for many years. On slide five, we have a strong pipeline of opportunities that we're converting into contracts. These are just a few examples we've converted since our last conference call. For a confidential Phoenix data center developer, we want a $36 million project to provide consulting, engineering, and construction management for a data center substation and interconnect. For the New York Power Authority, NYPA, We won two contracts worth a combined $20 million to provide energy infrastructure upgrades. NYPA has grown to become among our largest customers, and we thank NYPA for entrusting us with these latest awards. We also won another $17 million data center substation project for a confidential client in Sunnyvale, California. We were awarded a $13 million performance contract with the White River School District in Washington State provide energy efficiency and infrastructure upgrades. We were awarded a $6 million solar generation project in Illinois. And for that same state's Commerce Commission, we were awarded a million-dollar project to evaluate Illinois' electricity resource adequacy under new load conditions. The LADWP program, previously our largest contract, restarted finally in July. We don't expect material contributions from this $330 million five-year contract in 2025, but the ramp has started. Based on our pipeline of new opportunities and program expansions, we feel good about the outlook for 2026. On slide six. From 1970 to 2005, the US experienced several decades of sustained electricity load growth followed by 15 years of relative flatness. Today, we are in a new era of structural low growth, a trend that is reshaping the electricity landscape. This quarter reflected what we've seen over the past few quarters. Demand for our services is expanding across our end markets. The shift towards electrification, coupled with the resurgence in domestic manufacturing and the explosive growth of AI-driven data centers, creates strong tailwinds for WLDAN. Electricity demand in the U.S. is projected to grow by 50% between now and 2050, and we're already seeing the front edge of that demand emerge through multi-year infrastructure investments, grid modernization, and private sector-funded electricity for data center load. This demand environment supports our belief that WLDAN is well positioned to help our clients navigate these changes. We also continued to monitor the uncertainty around tariff risk. While these risks have not had a material impact on our business to date, we remain proactive. We're working closely with our clients to manage potential volatility, including inserting more flexible contract terms and identifying alternate suppliers for key equipment to mitigate pricing pressure if needed. While the economic environment remains generally constructive, a recession remains a potential risk, We would not be immune to a broad-based slowdown, but if that occurs, we believe Wildan is relatively well insulated, given the funding sources of our core customers, particularly utilities and public agencies. Overall, I'm very pleased with Wildan's performance. Q2 was solid across the board and forms the foundation for a strong second half and an even stronger 2026. Kim, over to you.