Babcock & Wilcox Enterprises, Inc.

Good day and thank you for standing by. Welcome to the Babcock and Wilcox Q1 2021 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 on your telephone. Please be advised that today's conference is being recorded. If you require any further assistance, please press star 0. I would now like to hand the conference over to your speaker today, Megan Wilson, Vice President of Investor Relations. Please go ahead.

Thank you, Cindy, and good morning, everyone. Welcome to Babcock and Wilcox Enterprises' first quarter 2021 earnings conference call. I'm Megan Wilson, Vice President of Investor Relations at BNW. Joining me this morning are Kenny Young, BNW's Chairman and Chief Executive Officer, and Lou Salamone, Chief Financial Officer, to discuss our first quarter results. During this call, certain statements we make will be forward-looking. These statements are subject to risks and uncertainties, including those set forth in our Safe Harbor provision for forward-looking statements that can be found at the end of our earnings press release and in our quarterly report on Form 10-Q filed this morning and our Form 10-K that is on file with the SEC, and provide further detail about the risks related to our business. except as required by law, we undertake no obligation to update any forward-looking statement. We also provide non-GAAP information regarding certain of our historical results to supplement the results provided in accordance with GAAP. This information should not be considered superior to or as a substitute for the comparable GAAP measures. A reconciliation of historical non-GAAP measures can be found in our first quarter earnings release published this morning and in our company overview presentation filed in Form 8K and posted on our investor relations section of our website at babcock.com. With that, I will turn the call over to Kenny.

Thank you, Megan. Good morning, everyone, and thanks for joining our call. Our results for the first quarter of 2021 really reflect the ongoing drive, commitment, and dedication by our employees, the strength of this management team, and our turnaround efforts, including cost reductions and growth strategies. All segments generated positive adjusted EBITDA and we ended the first quarter well, despite continued adverse effects of COVID across each of the segments. With our strategic growth initiatives over the last year, which included launching new segments, expanding our sales and service presence internationally, implementing additional cost saving and overhead reduction initiatives, significantly reducing our secure debt, and our continued focus on smaller projects, we have positioned this company to successfully leverage the global demands while preserving cost structure flexibility. Notably, we booked $645 million of new work in 2020 and continued this momentum with $170 million in bookings in the first quarter of 2021. we ended the first quarter strong with $535 million in backlog. And importantly, keep in mind that generally speaking, our backlog does not include shorter lead time, parts, and services. As we previously stated, we're reiterating our target of $70 to $80 million of adjusted EBITDA in 2021 based on our current visibility. Our first quarter performance puts us in a strong position to achieve our EBITDA objectives with consolidated adjusted EBITDA of $8.5 million, which is ahead of our internal plan and still takes into account the seasonal impacts of cold weather and customers' reduced maintenance outages that generally impact first quarter performance. Our normal cyclical performance typically shows increasing profitability from Q1 to Q4 each year. Our strategic actions over the last two years and improved performance has provided a solid foundation for our growth strategy. We are seeing attractive targets for investments or acquisition opportunities, both in emerging technology and mature products and services, including small add-ons or larger transformative opportunities. We are focused on opportunities that generate strong cash flow, leverage the strength of our proven management team to improve margins and generate synergies, or that expand or complement our clean energy technology portfolio, all of which drive shareholder value. As we announced last year, we have aligned our market-facing segments in financial reporting under three new segments – B&W Renewable, B&W Environmental, and B&W Thermal, which directly reflect our core markets, technology, and strategic pursuits. For several years, B&W has anticipated the changing global energy infrastructure needs and requirements for clean energy, which we believe will include significant steps forward in the application of carbon capture technology. We have been a leader in decarbonization research and development for decades and hold more than 90 active patents for carbon capture technologies. our proven decarbonization solutions are either currently in use or ready for demonstration and commercialization to support utilities waste treatment facilities in a range of other industries including steel cement oil and gas food manufacturing pulp and paper as they work to decarbonize their environmental footprint we are developing a brand new platform for our suite of cutting-edge decarbonization technologies and services This suite puts us in a leading-edge technology position on a global basis and includes our hydrogen-fired package boiler offering, which has been in operation for several years, as well as coal-fired to hydrogen-fired boiler conversions. our Regenerable Solvent Absorption Technology, also known as RSAT, which is an advanced fully regenerable solvent to capture carbon dioxide emissions from post-combustion flue gas streams for utilization of storage backed by 20 years of research. Our oxycombustion technology, which isolates a concentrated stream of carbon dioxide for utilization or storage. This technology was successfully demonstrated at a 30-megawatt thermal scale, one of the largest successful oxycombustion demonstrations completed worldwide, and is ready for large-scale commercialization. And our chemical looping carbon capture and hydrogen production technology, a breakthrough technology with exceptionally advanced versatile oxide in terms of application, cost, and abundance, which has been successfully demonstrated to isolate carbon dioxide for utilization or storage while simultaneously producing hydrogen. This technology, which is economically scalable for large and small installations, can use a wide variety of feedstocks or fuels, was jointly developed by B&W and a major university in the U.S. and is ready for large-scale demonstration. In addition to this suite of technologies, we continue to see new opportunities being developed within the United States and internationally for organic and inorganic growth of our renewable and environmental technologies, including hydrogen production, carbon capture, and waste energy technologies, with the potential for B&W to drive a worldwide industrial transformation to a green environmental future. To further accelerate our growth strategy, we're forming an advisory council made up of experienced global leaders with a wealth of knowledge regarding the industries we serve, emerging technologies, regulatory policy, and geopolitical drivers affecting them. The advisory board will work with the B&W leadership team to assess market trends, identify innovative opportunities and acquisition targets, and develop strategies related to new markets and technologies. In addition to opportunities within emerging technology markets, we are also seeing acquisition opportunities within the thermal services sector with the potential to achieve immediate synergies and higher margins, leveraging the strengths of our experienced management team. Our recent deleveraging and capital-raising events, including our preferred stock offering that closed on May 7, 2021, have positioned us well to leverage these types of opportunities as they arise to support our growth strategies and derive shareholder value. I'll turn the call over to Lou now to discuss some of the key points of our financial performance in the first quarter of 2021. Lou? Thanks, Kenny.