Q3 2021 Atlas Technical Consultants Inc Earnings Call
[music].
Hello, and welcome to the Atlas Technical consulting third quarter 'twenty 'twenty. One conference call. Currently all participants are in a listen only mode. A question and answer session will follow the formal presentation.
If anyone should require operator assistance during the conference. Please press star zero on your telephone keypad.
As a reminder, this conference is being recorded.
And now like to turn the call over to your host Walter Palo Chief Accounting Officer of Atlas. Thank you Sir you may begin.
Thank you for joining our third quarter 2021 earnings conference call.
We hope that you have seen our earnings release issued after the market closed today.
Please note that we have also posted a presentation in support of this call, which can be found on the investors section of our website one Atlas dotcom.
Before we begin I would like to remind you that today's call may include forward looking statements any statements, describing our beliefs goals plans and strategies expectations projections forecast and assumptions are forward looking statements.
Please note that the company's actual results may differ from those anticipated by such forward looking statements for a variety of reasons many of which are beyond our control.
Please see our recent filings with the Securities and Exchange Commission, which identify the principal risks and uncertainties that could affect our business prospects and future results.
We assume no obligation to update publicly any forward looking statements.
In addition, we will be discussing our or providing certain non-GAAP financial measures today, including adjusted EBITDA adjusted EBITDA margins adjusted net income and adjusted EPS.
Please see our release and filings for a reconciliation of these non-GAAP measures to their most directly comparable GAAP measure.
I'll now turn the call over to our Chief Executive Officer, Joe Boyer.
Thank you Walter and I appreciate you joining us today.
Before I begin I'll mention that our Chief Financial Officer, David Quinn will not be participating on this call. As he is currently recovering from a recent medical procedure. It all went well and he'll be back to work next week.
I, along with my Atlas team wish David well on its road to recovery.
So on today's call I'll provide an overview of the business.
Can you give us an operational update.
And then Walter will continue with discussion of our financial results and outlook before we open up the call for questions.
So starting on slide four.
It gives me great pleasure to speak with you today, not just about another solid quarter of financial and operating results for Atlas.
I'll also highlight the incredible opportunities we see for growth as we look forward to 2020, two and 2023.
This is backed by expanding market man stimulus funding our tech enabled capabilities.
Our major project and program pipeline.
Now before I touch on these aspects of our bright future I'd like to highlight the strength and resilience of our business delivered solid results in the third quarter. Despite a number of challenges.
This performance is really due to our focus on execution by our entire Atlas team and I'm thankful for that.
We delivered over 15% year over year revenue growth driving an increase in adjusted EBITDA to approximately $20 million.
Common to our industry.
Economy wide labor pressures impacted our margins in the short term as cost recovery programs in the form of price increases lagged slightly.
Market shifts in the transportation business led to volume decreases in some larger projects in the quarter.
The person to the acceleration of activity in the prior year quarter when traffic patterns were an all time low due to COVID-19.
We had a very strong quarter winning work.
Our backlog again rose to a new record level of 757 million deals.
Fueled by New major project infrastructure and environmental related contract awards.
This was an incredible feat during our third quarter.
Typically our highest revenue quarter.
We were successful in converting into backlog nearly half of the roughly $150 million of New awards, they were pending contract execution.
Not yet in backlog at the end of the second quarter.
And due to our results in winning new business across markets and through the cross selling.
Now have an additional 175 million of awarded but not yet signed contracts.
This demonstrates trust placed in us by our clients and the technical expertise of our professional services.
Our company is purpose built to ensure quality longevity and sustainability in our nation's public and private investments and are both natural and built environments.
Our detailing from slide five.
We expect markets and service areas to benefit from strong secular tailwind is unlike any other time that I've seen in my career.
As the nation continues to recover from the pandemic, we're seeing a steady ramp client demand as we move into 2022.
This includes the renewal of infrastructure assets that are overdue for improvement replacement and connectivity to ensure safety and reliability along with the renewed focus on sustaining and improving our environment.
Of course, recent building and bridge collapsed tragedies remind us of the importance of quality assurance and asset monitoring plays in keeping us safe, which is driving growing demand for higher safety regulatory and code compliance.
We continue to see growth in outsourcing by state Dot's cities and municipalities and the private sector for both projects and quality assurance services.
This urgency to address overdue upgrades to our nation's infrastructure has only been heightened by the rise of climate impacts and the threats to public health and security.
Growth in environmental social and governance or ESG has increased awareness on enhancing the quality of life for communities and sustainability of our planet.
They're also looking for public and security improvements for the wellbeing and safety of community infrastructure and workplaces.
With increasing climate and pandemic related tragedies occurring Atlas has responded critical monitoring of air quality for fires in the west.
Assessments are possible viral exposure pathways for infection.
And healthy building studies and hurricane flooded areas.
Oh, the commonality of all these focal points is resilience and the broadest definition, it's about strengthening our infrastructure our environment, our communities and economies to survive extraordinary challenges.
On an Atlas we built a company that is uniquely positioned to address those challenges.
Taking a closer look on the next slide please.
Yeah.
And as you can see on slide six the.
The Atlas platform is directly aligned with the critical ESG focus areas of our clients.
Our technical experts, creating innovative solutions that I'll discuss a bit later on slide nine are at the forefront of addressing our clients' diverse needs, whether it's connecting smart cities protecting our ecosystems.
Upgrading to healthy buildings for other technical services required for today's rapidly evolving standards.
Starting with the focus on mobility across modes of transportation and technology. All four of our service areas are engaged to capitalize on macro trends.
The same holds true for risk quality and safety.
Our ability to successfully win work and all these service areas through cross selling and to consistently advance our acquisition integration strategy is contributing to our growth and record backlog.
We continue to execute on our disciplined M&A strategy targeting companies that bring rich cross selling opportunities to the Atlas platform.
And are well positioned to capitalize on the infrastructure and environmental market tailwind.
Our pipeline is very healthy.
The proprietary opportunities that are both technical experts and fit this mold.
These targets are typically firms that have seen the rapid growth and success at Atlas over a short period of time and are excited to be part of the future success of this company.
And this lends itself to deleveraging transaction structures.
Principles are eager to take Atlas.
And have a vested interest in the future growth of Atlas.
Several of the targets in our pipeline are in advanced stages of due diligence and as a result, we're well positioned to expedite our strategic growth initiatives, we revenue synergies through cross selling and accelerate the deleveraging of our balance sheet.
Beyond these prevalent market tailwind.
Enactment, the 1.2 trillion dollar U S infrastructure Bill flown on slide seven well represented milestone moment for the nation and for Atlas.
As I said earlier and even more so with this federal Bill.
This renewed focus and investment in infrastructure and environment, maybe the best I've seen in my career.
In tandem with the upward trend of outsourcing critical technical and proprietary professional services that Atlas provides this bill is an extremely positive catalysts for our business in the upcoming years.
The spending bill is directly focused in the markets and services provided by Atlas with transportation being the biggest followed by water and utilities.
Technical services typically represent about 6% to 8% of the spending on infrastructure and environmental projects. So this represents large incremental opportunities for our services.
We look forward to working with our diversified portfolio of public and private sector clients to drive value added services and the focus areas of the bill as new programs and spending comes online late in 2022 and beyond.
Just as important as the absolute funding levels. This federal investment tailwind prioritizes the need for performance improvement and lifecycle extension of critical asset stress by climate health and economic impacts that's.
That's exactly what we do here at Atlas and our momentum in winning larger projects continues to increase.
Moving on to slide eight we have some significant sized projects planned for kick off by the end of the year and then in the first quarter of 2022.
Consistent with this I'm excited to profile, our recent $15 million I 35 project win which is a part of a major project for the Texas Department of transportation.
It will provide design quality assurance services for the $1 5 billion dollar I 35 northeast expansion design build project.
Partner, the Alamo any ex construction JV team.
This section of I 35 is a major gateway into the San Antonio area. It's one of the most congested roads in Texas.
He proposed improvements will include elevated highway lanes additional connector bridges construction of general purpose lanes revisions to ramps improving interchanges and other enhancements such as drainage utilities in size.
And this is expected to have a significant improvement in safety and mobility reduce congestion and accommodate the future traffic demands from the growth of the <unk>.
Third most populous city of Texas.
Under this phase of the contract Atlas will provide design review of infrastructure assets to ensure compliance with the design build contract and Txdot codes and specifications.
We are thrilled to be part of this major project and anticipate being part of the construction phase as well.
Our long standing relationship with Txdot demonstrates the trust in our expertise to deliver this major infrastructure projects.
It will play a pivotal role in the growth of the area.
And as I mentioned earlier, we bring both technical expertise and innovative solutions to our clients.
On slide nine I'll provide a couple of examples of how our technology applications and innovative solutions strengthen our service offerings and help us deliver results for our clients.
Our client for a University of Washington Project was faced with a costly challenge of addressing contaminated assets during the stadium renovation.
Our teams in depth understanding of materials reactivity allowed us to sustainably reuse materials, while complying with the environmental cleanup and code requirements.
A proprietary Atlas design Leach ability and geotechnical testing modeling program enabled to reuse of 60000 cubic yards of concrete debris into the newly renovated stadium, while reducing construction disposal waste.
And enhancing protection of nearby wetlands and groundwater quality.
As another example, I'm very proud of our teams to work with the city of San Diego's critical water infrastructure.
Access to this certain stretch of coastline was heavily constrained.
So we use the extensive geotechnical technologies.
Including vibrating wire pedometer and vibration monitoring equipment to develop an early warning system. The coastal bluff erosion as a major threat to this critical water asset.
Our technical experts can generally use proven technologies from varian applications to develop unique solutions from G. I S integrations for monitoring and modelling wildfire impacts on high speed rail.
The geophysics searching for deep Aqua for us in the west.
<unk> proud of our diverse technical capabilities.
Now, let me address our record backlog and third quarter key wins.
As I said earlier third quarter backlog increased 757 million the number of major project wins across services and geographies.
We saw particular strength in New awards as our state and this will agency markets are getting back to a more normal course of business regarding contract procurement and letting opportunities.
Now as you can see on slide 10.
The strength of our diversity of our service offering plays well to the increased demand for our infrastructure and environmental capabilities, which in turn drives backlog growth and visibility into future revenues.
So with that I'll turn the call back over to Walter.
Thanks, Joe and please turn to slide 11.
Now for the details of the quarter gross revenue of $138 7 million was up 15, 1% compared to the prior year quarter, driven by strong execution across all service offerings and contributions that were both organic and from recent acquisitions.
Our environmental solution services saw the biggest gains this quarter, along with engineering and design services as we continue to see commercial markets accelerate and larger projects and programs enter the portfolio.
Net revenue of $112 $5 million was 15% higher than the prior year period and represented approximately 81% of gross revenues.
With our strategy to cross sell and self perform more work to improve margins.
We realized improved utilization rates, even as we grew our workforce during the quarter.
Like many businesses, we are managing through the great resignation.
Our key awards tend to attract highly qualified professionals and we have been successfully increasing our workforce this year.
Adjusted EBITDA of $19 8 million was four 1% higher than the third quarter of 2020 and represented 17, 6% of net revenue compared to 19, 4% in the prior year quarter.
Revenue growth supported our EBITDA growth, our project mix and some labor cost inflation at a temporary impact on margins.
For the third quarter, we produced adjusted net income of $4 6 million and adjusted EPS of <unk> 14.
Versus 18 cents in the prior year quarter with some differential in EPS related to the conversion.
<unk> D to class a shares over the past year.
Moving to slide 12.
Year to date, we have delivered positive cash flow from operations.
During the third quarter cash flow from operations was a use of $6 2 million.
The primary driver of this was a larger than typical build in working capital requirements to support our revenue growth.
We expect a very strong cash quarter in Q4, driving cash flow and liquidity to the highest levels. During 2021 as we closed the year with net leverage on path to be at approximately six times by year end.
Moving to our full year outlook on slide 13.
We are raising the low end of our revenue range for the full year 2021.
We now project revenue to be in the range of 530 $540 million.
This outlook reflects the continued strength of our backlog and operational performance current visibility on the timing of work and the contributions from recent acquisitions.
We anticipate that adjusted EBITDA will come in closer to the low end of our unchanged $73 million to $80 million range.
This is primarily due to incurring higher labor cost and impacted margins in the third quarter ahead of labor rates resetting.
Given our business is approximately 90% cost reimbursable.
We actively mitigate this as we price new contracts and rates on existing contracts reset.
As Joe mentioned, we are excited about the passage of the federal infrastructure Bill and are looking forward to incremental investments, where Atlas can assist our clients in the future.
Based on our existing backlog pending contract awards strong market tailwind and the accretive benefits of recent M&A, we expect adjusted EBITDA to grow in 2022 in the low to mid teen percent range. We're all extremely excited by the growth potential for our business.
Moving forward.
Thank you and I'll now turn the call back to Joe for closing remarks.
Great. Thank you again Walter.
I am proud to represent Atlas is 3600, plus employees, who are passionately working hard on critical infrastructure and environmental projects across the U S.
Our ability to deliver growth in revenues and EBITDA, while pushing backlog to record levels highlights the immense potential of this team and our company.
Our success in winning work reflects our effectiveness in integrating acquisitions cross selling services and providing technology solutions to our client network.
Our growth efforts continue to gain steam supported by a resilient business model and the alignment of our business to strong long term key market growth drivers.
These market tell runs include the renewal of aging infrastructure broad based commitment to environmental stewardship, and the need to improve quality safety and resiliency for our communities.
We anticipate the infrastructure Bill will help accelerate these tailwind in coming years, and we look forward to help the nation advance its transformational investments and infrastructure and the environment.
I firmly believe in the power and potential of this organization, particularly our ability to deliver solid margin performance.
All while deleveraging our balance sheet.
I look forward to continuing our positive momentum in the final quarter of 2021 and for many years to come.
Thank you again for joining us today and operator, you can now open up the lines for Q&A. Please.
Thank you, ladies and gentlemen, we will now be conducting a question and answer session. If you'd like to ask a question. Please press star one on your telephone keypad and confirmation tone will indicate your line is in the question queue.
You May press star two if you'd like to remove your question from the queue. So far just simply using speaker equipment. It may be necessary to pick up the handset before pressing the star keys.
One moment, please only poll for questions.
Our first question comes from the line of Rob Brown with Lake Street Capital markets. Please proceed with your question.
Hi, Joe Hi, Walter.
Hey, Rob how are you.
Great Nice nice job on the quarter nice to see some strong growth.
Maybe just.
Think about the growth environment I think you had a pretty nice backlog of projects. You've won that had that haven't been put in the backlog yet, but maybe could you comment a little bit about how the growth in bar are the new contract environment as he was coming through right now and how.
How you see it playing out over the next few quarters.
Certainly really good question, Rob So you know as I've said in my experience. This this industry has always been.
In a tight labor market right. So we've built our business to address.
This challenge I think.
We focus on being an employer of choice with the Heartland culture and being competitive in compensation and benefits you know.
So found that people like to work on marquee projects and high profile projects in and with our backlog of major projects growing them. You know we have been a net importer of technical talent and and successful at attracting some highly competent colleagues. So so we're excited about that I think our recruiters have done an absolutely.
Excellent job, despite the labor challenges and we see the you know the need to continue investing there. So we will continue our sharp focus on on labor resources to address our revenue projections.
Okay great.
If you could clarify how the how the contracting works as labor prices go up to you.
Do you sort of contractually are you able to pass that on.
And does that show up a quarter or two later, how does that sort of work in terms of getting the price increases.
Yes, we do we basically we've already.
<unk> addressed our pricing on our commercial work and and those costs have already been projected forward.
On our more public work, we get a chance to pass on those costs. We do those on a on a term basis or are you know are on an annual basis renewal. So basically we have a short term lag in that and it typically you know is a is a one to two quarter lag. So we'll start to see those impacts in our.
On our radar at all on our labor rates improving in Q4, and then the H one and 2022.
Okay. Okay, Great and then last question is on the infrastructure Bill I think you talked about that sort of hitting your.
We're starting to hit your growth in later next year, how do you sort of see that playing out.
How is it the federal spending how does that normally flow through to your business.
Sure. So you know as I did say it first of all I'm just.
You know very glad to see this long overdue federal investment I know, we've talked about that in the past that you know the strength of this company is squarely in the focus of that Bill you know infrastructure renewal, our environmental stewardship and the climate resilience is squarely where we focus so jumped from my experience.
It'll take at least a few quarters to see impacts from this bill and that's that's even on shovel ready projects. So it's going to take a little bit of a few quarters to see that come through and I.
And I said you know, we're we're already in a great environment without the bill, but certainly even better so now and I think this speaks to the sustainability of our company. Just a reminder, that I know we put out this early guidance for 2022, but it does not include the impacts of this bill as of yet.
Okay, great. Thank you I'll turn it over.
Thanks, Rob Thank you.
Our next question comes from the line of Brett Feldman with D. A Davidson. Please proceed with your question.
Hey, Thanks, Hey, Joe Hey, Walter.
Hey, Brian Hey, there.
Yeah, I guess first on the outlook for the rest of the year on the revenue side, I mean implies a pretty big step up here in the fourth quarter reasonable step after that is that typical for your business or is that just the culmination of this backlog.
Backlog of work that you're going to start burning through.
Yes, but let me let me say that are you know I think we have a really good visibility.
Into the remainder of the year, given our current book of business than our stickiness to our.
Investor I mean in our client relationships.
<unk> ships, our backlog steady.
And we were comfortable raising the low end of that revenue range because of that we still.
We're making the decision to focus and invest in 2022 and growth and beyond and and I think that that we feel comfortable in that revenue was out there I will remind you that what we are seeing is a steady growth across just about all of our markets and geographies I think.
Our environmental and test and inspection services are steadily growing to support you know pick up in commercial activities. We're seeing real estate transactions are increasing with financial institutions' funding deals whats drives commercial activity.
Our petroleum clients are now spending on capital programs and back to almost normal levels for us.
The public sector.
Clients have been a little bit inconsistent, but are releasing delayed programs from city agencies and schools and stuff and I'd say with the exception of New York, which isn't completely back steady and then I think most important transportation clients now with with new budgets come in Florida, beginning to release new projects on budget.
And so we feel really good about what we've put out for our guidance in Q4.
Okay understood and then.
Joe I just wanted to clarify it sounds like.
At the time, you get through the first half of next year.
Would it be caught up.
Respect, where do you see sort of pricing on contracts today relative to inflation you felt through the business is that the fair way to think about in terms of margin.
Margin performance.
Yeah, I think that's fair Brent I'd remind you that those are costs that we've incurred to date right. If if we continue to see.
In a wage wage inflation going forward of course, it'll it'll be a little bit of a lag, but will continue to pass that pass that cost on as well, but I think that's fair to what you characterize right.
Okay.
Okay, and then the $175 million and work that that does that get signed this quarter and presumably so and backlog log I'm. Just wondering if any of that the carryover of last quarter or whether the processes to turn these kind of new contracts are taking longer Joe any thoughts there.
Sure. So rod let me give you if you remember last quarter, we had what we had $150 million of awarded but unsigned which at that time. So I told you was what's the you know an increase a steady increase over what we normally see so we signed about $70 million of that in Q3. So.
We still got another what 80 or so to the book and we added to that.
No not in the $95 million of awarded not signed contracts. So I would tell you that I would expect.
You know I would hope that that half of that would be signed in Q4 and probably continue on into Q1, but it is a direct reflection of our clients being back to work and getting the contracts groups and procurement our resources back. So it is a little slower than normal, but that's what I anticipate.
Okay. That's great. Thank you guys.
Sure.
Thank you. Our next question comes from the line of Daniel Burke with Johnson Rice. Please proceed with your question.
Yeah, good afternoon guys.
Hey, Dan how are you.
Just just one on the M&A pipeline 40 ball you noted you had some.
Good opportunity still in front of you, but I guess I just wanted to ask with the infrastructure Bill now in reality you know how does how does that influence maybe bid ask spreads when you're when you're looking at potential opportunities and deals.
So so let me start by saying that you know I think the infrastructure Bill just reinforces that that we're confident in our strategy I think we are focused squarely where.
Where the bill is focused in infrastructure and environmental.
Tailwind so.
As we continue to look in those markets and we really are focused on.
Really geographies, where the states are being creative and and and particularly alternate funding means we loved the transportation space roads bridges highways water systems Transit rail and utilities, that's where we're focused and as you mentioned, we had focus on proprietary opportunities. So we typically shy away.
Broker led deals and we're looking for technology leaders and those business that are focused in the same market growth drivers that we are currently in and leverage those to cross sell services. So we have seen US you know a slight uptick in there's certainly some some.
Higher multiples being paid out there, but but given our strategy and where we focus.
You know, we haven't seen that much of an impact on a an increase in maybe a maybe a half of a turn from where we've been traditionally focused.
That helps you.
Yeah, Yeah. It does thanks and then.
And I guess, maybe to pivot just a little bit of refer back to an earlier question.
I don't want to get too myopically focused on a singular quarter, but when you think about order inbounds and backlog trending through year end I mean, you do have the benefit of of your customers in many cases being back in the office and the fact that the.
The pending contract awards figure is up versus three months ago. I mean, it would seem to suggest a positive environment and the potential for sequential improvement in bookings and in Q4 and for the rise in backlog, but I want to make sure I I appreciate any sort of seasonal elements that Q4 can sometimes bring that might affect our bookings you would expect.
To see in the fourth quarter, if you could if you could comment on that.
Certainly Dana so I would say I think you're fair to assume that I will tell you that actually Q4 is our biggest I'm sorry, Q3 is our biggest burning quarters. So backlog growth in this quarter is a real positive sign for US obviously I think with the I'm just talking about normal signings.
These awarded projects yet to be signed should in fact grow our backlog will.
It would be a positive impact to our current backlog levels.
Yes, many of the state Dot's, Daniel Sorry go.
But Daniel.
No Walter Please go ahead.
Yeah. So many of our C. D O T. A day, they just got into their new fiscal year. So we see usually hear some increased leading here in the fourth quarter as they kind of tap into their new budgets.
Okay. That's helpful. And then a last simple one can you guys give me up but just an estimate on where our organic revenue growth was year over year in Q3.
Yeah, Daniel so year to date are where we're above 3% organic growth. This quarter was down a little bit we don't guide quarter to quarter.
In terms of revenue growth and organic growth.
For the year, we expect to be in the mid single digits for the full year 2021.
It's in line with our expectations and are on track with our guidance.
Got it okay. Thank you guys I appreciate the time this afternoon you.
You bet. Thank you Daniel appreciate it.
Thank you. Our next question comes from the line of Kathryn Thompson with Thompson Research Group. Please proceed with your question.
Hi, Thank you for taking my questions today on large projects.
<unk> discussed this year, how you're seeing larger projects this year as the company grows platform builds.
And you're just able to win larger more complex projects.
And even recently win T. Oh quality assurance project that you announced in Texas is testament to that.
What if any change do you see that with the passage of a federal infrastructure Bill and it's.
Stepping back and thinking fluid secretion.
Really more interested in terms of what your end customers, you're saying, how they plan from our projects based on potential pathogens.
Thank you.
Sure Hi, Catherine.
Let me say that debt.
I think we will continue to see some.
Some of these larger projects and the importance that quality assurance plays in these larger projects, which is relatively.
<unk>.
A new scope of work the larger design build opportunities.
So.
I think to answer your question I think are the projects that are state Dot's are planning on putting out is probably for large projects has already been on the radar screen and have been a bit or at least planned previously I don't know that this infrastructure Bill will have a dramatic impact on some of the larger projects outside of.
Maybe Georgia 400 project in Georgia.
But I'm sure there's a number of other larger projects that I'm currently not aware of that my technical team would be but I'd say the answer to that is.
Again, I don't think there's a huge pick up in a large design build pickups.
Construction Bill will push through.
And we think it's gonna go mainly through state Dot's cities and municipalities, which would lend itself to a more what do you want to say just more a.
Smaller projects and size.
Okay.
A lot of focus on the surface transportation, but yeah.
There are definitely some larger dollars set aside for wastewater.
How has your work and project, perhaps you got kidney been around water and wastewater progressed.
Congrats again to the back half of the year.
Are you starting to see early signs in the first half.
Takeaway issues had residential build out progressing what are you seeing now and what does this look like.
Over the next say 12 to 18 months based on your experience and what Youre seeing now in the pipeline.
Yes.
So let me, let me say that that we have seen around our Pennsylvania, Philadelphia area, we have seen a pickup in our wastewater design and oversight services in that area I would say.
That's about the only area that I can tell you that I can think of that it has a dramatic improvement.
Improvement at least over last year and our services in the water wastewater area. We are seeing obviously more.
Construction engineering inspection projects coming online in regards to water. So there's water projects being built out.
But outside that Catherine I can't say that I, you know I have a.
Crystal ball into the next 12 to 24 months around water and water in particular for US I would say that majority of our projects that we have that currently out there are really focused more on the transportation.
Side of the business, including transit and rail.
And all forms of of those projects.
Okay.
Hum.
A couple on that and then on the Labor front, obviously has been a focal point throughout this year.
I also have the added.
Vaccination mandate and we're hearing from a wide variety of our industry contacts that that has created additional complications.
Just in getting jobs done how are you managing that and what update and T. D T against on the later tranches.
Just getting projects done.
Sure well I will tell you that for us. It currently it hasn't had an impact to us in regard to getting projects done or even to you know our turnover in stat I will tell you we are obviously.
In the middle of a of a vaccine build as a federal mandate on a on an federally funded contracts and then yet we have some state contracts that are up absolutely counter to that same mandate. So we are trying to work through the differing requirements that are up.
In regards to vaccines.
And still a top priority for us, but it has not been a a current impact to them are getting our projects done or even turnover in our staff that I'm aware of.
Okay.
And thank you and have you.
And then once again a lot of places come up construction, but.
One thing that we have seen in leading into potential passage of T cells.
Long term highway bill, sometimes you'll see people hold back bidding just to see what happens.
It doesn't appear to be the case this time around.
Case in point, you were saying that you were seeing a level of bidding activity not seen before.
Just how does this momentum continued.
And is there any momentum in it.
Turning these states into projects.
Infrastructure, bill or or other factors.
Taking into consideration.
Well, let me say that that we you know well.
We saw a tremendous pickup in transportation work.
Mainly in the execution of the work in Q3 Q4 of last year right. So our transportation business grew 24% in 2020, So you know as the.
As the state agencies, we're really accelerating work.
Due to low traffic volumes and so we were we were caught in a little bit of volume downturn in 2021 as basically some of the particularly around the Texas D. O T markets had had really accelerated work. So we're now seeing that the new budgets to sort of back on track to normal historical levels.
Sure.
I haven't seen and I can't I can't side of.
A specific example of any impact we've seen currently from the federal infrastructure Bill on transportation or at least not in the Lettings currently.
And I don't know how else to answer that other than.
But I just communicated unless I missed something.
No that's helpful.
And thank you for answering my questions that's fine.
Thank you Catherine appreciate it.
Thank you ladies and gentlemen at this time there are no further questions I would like to turn the floor back to management for closing comments.
So why don't I mean, thank everyone for joining us today, we really appreciate your support of Atlas and I look forward to updating you on our progress. Thank you very much. Thank you.
Thank you ladies and gentlemen. This concludes today's teleconference. You may disconnect. Your lines at this time. Thank you for your participation.
Okay.