Q4 2024 Southland Holdings Inc Earnings Call
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Ri: Good morning, my name is Ri and I will be your conference operator today.
Lee: Good morning, My name is Lee and I will be a conference operator today at this time I would like.
Ri: At this time, I would like now to welcome everyone to the Southland fourth quarter and full year 2024 earnings conference call. All lines have been placed on mute to prevent any background noise.
Lee: Now to welcome everyone to the Salt mines fourth quarter and full year 2024 earnings conference call.
Lee: All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to ask a question. During this time simply press star followed by the number one on your telephone keypad. If you would like to withdraw your question Press Star.
Ri: After the speaker's remark, there will be a question and answer session. If you would like to ask a question during this time, simply press star, followed by the number one on your telephone keypad. If you would like to withdraw your question, press star, then the number two. Thank you.
Lee: Then the number two.
Alex Murray: Alex, you may now begin your conference. Good morning, everyone, and welcome to the Southland fourth quarter and full year 2024. This is Alex Murray, Director of Corporate Development and Investor Relations. Joining me today are Frank Renda, President and Chief Executive Officer, and Cody Gallarda. Executive Vice President, Chief Financial Officer.
Alex: Thank you Alex you May now begin your conference.
Speaker Change: Good morning, everyone and welcome to the South in the fourth quarter and full year 2024 conference calls.
Alex Murray: This is Alex Murray director of corporate development and Investor Relations.
Frank: Joining me today are Frank <unk>, President and Chief Executive Officer, and critical Arc Executive Vice President Chief Financial Officer.
Alex Murray: Before we begin, I'd like to remind everyone that this conference call may contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933. Section 21E of the Securities Exchange Act of 1934, and the Private Securities Litigation Reform Act of 1990. Both of these statements are neither historical facts nor assurances of future performance. forward looking statements are uncertain and outside of Southland control. Southland's actual results and financial conditions may differ materially from those projected in the forward-looking table. Therefore, you should not rely on any of these four lucky statements, and we do not undertake any duty to update these statements.
Frank: Before we begin I'd like to remind everyone that this conference call may contain forward looking statements within the meaning of section 27 eight.
Frank: Exactly I think 33.
Frank: Second 21 E of the Securities Exchange Act as Secretary for the private Securities Litigation Reform Act.
Frank: Got it.
Frank: <unk> looking statements are neither historical facts nor.
Frank: <unk> is a future performance.
Frank: Forward looking statements are uncertain and outside of south of control.
Frank: <unk> actual results and financial condition may differ materially from those projected in the forward looking statements.
Frank: Therefore, you should not rely on any of these forward looking statements.
Frank: Undertake any duty to update these statements.
Alex Murray: For a discussion of some of the risks that could affect results, please see the risk factor section of Reform 10-K for the year ended December 31st, 2024. That was filed with the SEC last year.
Frank: For a discussion of some of the risks that could affect results. Please see.
Frank: The risk factors section or Form 10-K for the year ended December 31, 2024 that was filed with the FCC last night.
Alex Murray: We will also refer to non-GAAP financial measures and you will find reconciliation of these non-GAAP financial measures in the press release relating to this conference call, which can be found on the Investor Relations page of our website.
Frank: We will also refer to non-GAAP financial measures and you'll find reconciliations of these non-GAAP financial measures in the press release relating to this conference call, which can be found on the Investor Relations page of our website.
Frank Renda: With that, I will now turn the call over to Thank you, Alex. Good morning and thank you for joining Southland's fourth quarter and full year 2024 conference. As we reflect on the year, I'd like to highlight and commend how our team has continued to push forward despite challenges, delivering key projects, maintaining operational excellence, and reinforcing our commitment to safety and community impact. We have successfully delivered several high-profile projects during the year. We completed the SR-80 bridge in Palm Beach, Florida, also known as the Mar-a-Lago Bridge. We also recently opened the East Adams Bridge in Connecticut, improving connectivity and regional access.
Craig: With that I will now turn the call over to Craig.
Thank you Alex good morning, and thank you for joining <unk> fourth quarter and full year 2024 conference call.
Craig: As we reflect on the year I'd like to highlight and commend how our team has continued to push forward despite challenges.
Craig: During key projects, maintaining operational excellence and reinforcing our commitment to safety and community.
We have successfully delivered several high profile projects during the year, we completed the <unk> bridge in Palm Beach, Florida also known as the <unk> logo bridge.
Craig: We also recently opened the east Adam the bridge in Connecticut, improving connectivity and regional access we completed a cruise destination project for private entertainment client in the Caribbean, which demonstrates our ability to deliver complex infrastructure.
Frank Renda: We completed a cruise destination project for a private entertainment client in the Caribbean, which demonstrates our ability to deliver complex infrastructure that enhances local economies. In our water resources group, we continue to expand our reach with the completion of the Stand One Lateral Project for the Bureau of Reclamation, providing essential water infrastructure to support communities in need. We also completed the Romeo Arm Slip Line Project in Detroit, Michigan. Beyond our technical expertise, our strong safety culture makes these successes possible. I'm pleased to report that multiple projects, including Ashbridge's Bay Outfall Tunnel, SELA 26, and Mill Creek Drainage Relief Tunnel, have each surpassed one million safe work hours without a lost time incident, a testament to the dedication of our teams and our unwavering commitment to safety as the foundation of everything we do.
Craig: Hence as local economies.
Craig: Our water resources group, we continue to expand our reach with the completion of the San Juan lateral project for the Bureau of reclamation.
Craig: Providing a central water infrastructure to support communities in need.
Craig: Also completed the Romeo arms slip line project in Detroit, Michigan.
Craig: Beyond our technical expertise our strong safety culture makes these successes possible I'm pleased to report that multiple projects, including Ash bridges pay out fault tunnel.
Craig: <unk> 26, and no create greater relief tunnel at each surpassed 1 million safe work hours without a lost time incident.
Craig: Testament to the dedication of our teams and our unwavering commitment to safety is the foundation of everything we do.
Frank Renda: Additionally, this year marked the 50th anniversary of two of our subsidiaries, a milestone that not only honors our rich history, but also the strong foundation we have established over many decades, which sets us up well to succeed for years to come. While this has been a demanding period, our team's resilience and ability to execute at a high level have positioned us for future success. I want to thank our employees and stakeholders for their commitment and continued trust in us.
Craig: Additionally, this year marked the 50th anniversary of two of our subsidiaries a milestone that not only honors our rich history, but also the strong foundation, we have established over many decades, which sets us up well to succeed for years to come.
Craig: This has been a demanding period, our team's resilience and ability to execute at a high level have positioned us for future success.
Craig: To thank our employees and stakeholders for their commitment and continued trust in us with that let's turn to the quarter's results.
Frank Renda: With that, let's turn to the quarter's results. Fourth quarter revenue was $267 million with a gross profit of $8 million. Excluding unfavorable adjustments from the M&P business and certain legacy projects, our gross profit in the quarter was $35 million. The unfavorable adjustments negatively impacted our results by $27 million. The unfavorable adjustments were driven by dispute resolutions and increased completion costs on certain legacy projects. At the end of the quarter, we had approximately $163 million of remaining M&P backlog and approximately $83 million of non-M&P legacy backlog. We are encouraged by the continued strong performance of our new core projects, which delivered double-digit margins in the quarter.
Craig: Fourth quarter revenue was $267 million with a gross profit of $8 million.
Craig: Excluding unfavorable adjustments from the MMP business and certain legacy projects, our gross profit in the quarter was $35 million the unfavorable adjustments negatively impacted our results by $27 million. The unfavorable adjustments were driven by a dispute resolution.
Craig: And increased completion cost on certain legacy projects.
Craig: At the end of the quarter, we had approximately $163 million of remaining MMP backlog and approximately $83 million.
Craig: Mind MMP legacy backlog.
Craig: We are encouraged by the continued strong performance of our new core projects, which delivered double digit margins in the quarter.
Frank Renda: We ended the quarter with $2.57 billion of backlog. I'd also like to note that we currently have approximately $750 million of pending alternative delivery contracts not included in backlog. for which pre-construction phases are already underway. Notable alternative delivery projects include the earthquake-ready Burnside Bridge in Portland, Oregon, and phase two of the North End Treatment Plant in Winnipeg. We are currently working on phase one of this project. Our new core work makes up approximately $2.3 billion of backlog. We have several new core projects that we expect to ramp up this year and create a more significant impact on results.
Craig: We ended the quarter with $2.57 billion of backlog.
Craig: I'd also like to note that we currently have approximately $750 million.
Craig: Alternative delivery contract.
Craig: Included in backlog.
Craig: For which free construction phases are already underway. Notable alternative delivery projects include the earthquake ready Burnside bridge in Portland, Oregon.
Craig: In phase two of the north in treatment plant in Winnipeg. We're currently working on phase one of this project.
Craig: Our new core work makes up approximately $2 $3 billion of backlog.
Craig: We have several new core projects that we expect to ramp up this year and to create a more significant impact on results.
Frank Renda: This includes the $600 million Shands Bridge in Florida, the $410 million Robert F. Kennedy Bridge Rehab in New York, and the $243 million US-19 project in Florida. which were in the early stages of their project lifecycle. We also have several quicker burn water resource projects with strong margins that we expect to have a meaningful impact on 2025 results. We booked approximately $105 million in new awards during the quarter. This included a $60 million wastewater treatment plant in the Southwest, several water resource emergency projects, and a broadband project for a private client. We continue to see a large pipeline of opportunities, particularly from our longstanding federal, state, and local clients.
Craig: This includes the $600 million shares bridge in Florida $410 million Robert F. Kennedy Bridge rehab in New York, and the $243 million U S 19 project in Florida.
Craig: Which we are in the early stages of their project life cycles.
Craig: We also have several quicker burden water resource projects with strong margins that we expect to have a meaningful impact on 2025 results.
Craig: We booked approximately $105 million in new awards during the quarter.
Craig: This included a $60 million wastewater treatment plant in the southwest.
Craig: Several water resource emergency projects and a broadband projects for private clients.
Craig: We continue to see a large pipeline of opportunities.
<unk> early from our longstanding federal state and local clients.
Frank Renda: The ongoing capital infusion from the Infrastructure Investment and Jobs Act combined with historically strong state and local infrastructure programs provides a favorable tailwind for our business in the years ahead. Texas and Florida remain at the forefront of state-driven infrastructure investment, with record-setting funding levels aimed at addressing critical transportation, water, and resilience needs. Given the sustained economic growth and population expansion in these areas, we anticipate continued prioritization of large-scale infrastructure projects. With our established presence and deep expertise in these key markets, we are well positioned to capitalize on these opportunities. In recent years, the timing of new project awards has been somewhat uneven, with a tendency to ramp up in the back half of the year.
Craig: Ongoing capital infusion from the infrastructure investment and jobs that combined with historically strong state and local infrastructure programs.
Craig: <unk> a favorable tailwind for our business in the years ahead.
Craig: Texas, and Florida remain at the forefront of state driven infrastructure investment with record setting as funding levels aimed at addressing critical transportation.
Craig: Water and resilience needs.
Craig: Given the sustained economic growth in population expansion in these areas. We anticipate continued prioritization of large scale infrastructure projects.
Craig: With our established presence and deep expertise in these key markets, we are well positioned to capitalize on these opportunities.
Craig: In recent years, the timing of New project Awards has been somewhat uneven with the tendency to ramp up in the back half of the year, we anticipate a similar pattern this year.
Frank Renda: We anticipate a similar pattern this year, as project timelines and funding cycles influence the flow of opportunity. The demand in our core markets remains robust. driven by ongoing infrastructure needs and strong public and private sector investment. Given this favorable environment, we remain disciplined in our approach, prioritizing projects that align with our strategic goals, operational strength, and margin expectations. Our extensive pipeline of opportunities positions us well to secure a healthy share of projects while maintaining a selective quality over quantity approach to bidding. As we move forward, we are confident in our ability to capitalize on the right opportunities and drive long-term success.
Craig: Project timelines and funding cycles influence the flow of opportunities.
Craig: The demand in our core markets remains robust driven by ongoing infrastructure needs with strong public and private sector investments.
Craig: Given this favorable environment.
Craig: We will remain disciplined in our approach prioritizing projects that align with our strategic goals.
Craig: Operational strength and margin expectations are.
Craig: Our extensive pipeline of opportunities positions us well to secure a healthy share of projects, while maintaining a selective quality over quantity approach to bidding as we move forward. We are confident in our ability to capitalize on the right opportunities and drive long term success.
Frank Renda: Upcoming opportunities in our civil segment include the $7 billion Iona Island Wastewater Treatment Plant Program in Vancouver. and the $2 billion Northern Colorado Water Glade Reservoir Program in Fort Collins. We're also tracking the $600 million Jordan Lake Water Supply Program in North Carolina and additional phases of the Winnipeg North End Treatment Plant in Canada. In our transportation segment, we also expect to bid on the Verrazano-Narrows Bridge Rehab to New York and the Washington Bridge in Providence, Rhode Island.
Craig: Upcoming opportunities in our civil segment include the $7 billion Iona Island wastewater treatment plant program in Vancouver.
Craig: And the $2 billion, Northern Colorado water Glade reservoir program at Fort Collins.
Craig: We're also attracting the $600 million Jordan Lake water supply program in North Carolina.
Craig: And additional phases of the Winnipeg, North in treatment plant in Canada and.
Craig: In our transportation segment, we also expect to bid on the bears Narrows bridge rehab in New York.
Craig: In the Washington Bridge in Providence, Rhode Island.
Frank Renda: During the fourth quarter, we also successfully executed another strategic initiative to bolster our balance sheet. We converted $20 million of certain promissory notes due to myself.
Craig: During the fourth quarter. We also successfully executed another strategic initiative to bolster our balance sheet, we converted $20 million of certain promissory note due to myself.
Frank Renda: and the two other founders of Southland, Tim Nguyen and Rudy Renda, to come and talk. We feel strongly about the long term potential of Southland. This transaction reinforces our confidence in the business while improving the balance sheet.
Craig: And the two other founders of Southwind, Tim when is the.
Speaker Change: The common stock we feel strongly about the long term potential of Southwind.
Speaker Change: This transaction reinforces our confidence in the business, while improving the balance sheet.
Frank Renda: In closing, our strong new core backlog pipeline and the continued strong execution on new core projects. give us confidence in our long-term trajectory. We are focused on delivering operational excellence, maintaining a disciplined approach to project selection, and driving sustainable profitability over the long term.
Speaker Change: In closing our strong new core backlog pipeline and the continued strong execution on new core projects.
Speaker Change: Give us confidence in our long term trajectory.
We are focused on delivering operational excellence, maintaining a disciplined approach to project selection and driving sustainable profitability over the long term.
Frank Renda: As we move into 2025, our strategic priorities remain clear, executing our core projects with precision, winding down legacy work, and strengthening our position in our core market. With a talented and dedicated team and a favorable industry environment, we are well equipped to deliver long-term value to our stakeholders.
Speaker Change: As we move into 2025, our strategic priorities remain clear executing our core projects with precision winding down legacy work and <unk>.
Speaker Change: Strengthening our position in our core markets.
Speaker Change: With a talented and dedicated team and a favorable industry environment.
Speaker Change: We're well equipped to deliver long term value to our stakeholders.
Cody Gallarda: With that, I will now turn the call over to Cody for a financial update. Thanks, Frank, and good morning, everyone. I will discuss an overview of our financial performance for the fourth quarter and full year ending 2024.
Cody: With that I will now turn the call over to Cody for a financial update.
Cody: Thanks, Greg and good morning, everyone I will discuss an overview of our financial performance for the fourth quarter and full year ending 2024.
Cody Gallarda: You can find additional details and information in the financial statement, footnotes, and management discussion and analysis that were filed with the Securities and Exchange Commission on Form 10-K last night. With respect to the fourth quarter, revenue was $267 million, down $49 million from the fourth quarter of 2023. Gross profit for the fourth quarter was $8 million, down from $21 million for the fourth quarter of 2023. Gross profit margin in the fourth quarter of 2024 was 3%, compared to 6.7% in the fourth quarter of 2023. Selling general and administrative expenses for the fourth quarter were $16 million, a decrease of $4.2 million compared to the fourth quarter of 2023.
Cody: Can find additional details and information in the financial statements footnotes and management's discussion and analysis that were filed with the Securities and Exchange Commission on Form 10-K last night.
Cody: With respect to the fourth quarter revenue was $267 million.
Cody: Down $49 million from the fourth quarter of 2023.
Cody: Gross profit for the fourth quarter was $8 million.
Cody: Down from $21 million for the fourth quarter of 2023.
Cody: Gross profit margin in the fourth quarter of 2044, 3% compared to six 7% in the fourth quarter of 2023.
Cody: Selling general and administrative expenses for the fourth quarter were $16 million, a decrease of $4 2 million compared to the fourth quarter of 2023. This reduction was primarily driven by reduced compensation expense.
Cody Gallarda: This reduction was primarily driven by reduced compensation expense. Interest expense for the fourth quarter was $9.6 million, an increase of $3.9 million compared to the fourth quarter for 2023. The increase was attributable to higher debt balances and elevated borrowing costs. As previously discussed, we expect interest expense to remain in the $9.5 million per quarter range going forward. Income tax benefit was $14 million for the quarter compared to an income tax expense of $2.9 million in the same period last year. This was primarily driven by changes in our effective tax rate, the recognition of certain deferred tax liabilities, and the cumulative catch up impact of adjustments to forecasted versus actual year end results.
Cody: Interest expense for the fourth quarter was $9 6 million, an increase of $3 9 million compared to the fourth quarter for 2023.
Cody: Increase was attributable to higher debt balances and elevated borrowing costs.
Cody: As previously discussed we expect interest expense to remain in the $9 $5 million per quarter range going forward.
Cody: Income tax benefit was $14 million for the quarter compared to an income tax expense of $2 9 million in the same period last year.
Cody: This was primarily driven by changes in our effective tax rate the recognition of certain deferred tax liabilities and the cumulative catch up impact of adjustments to forecasted versus actual year end results.
Cody Gallarda: More information regarding the changes in our effective tax rate, valuation allowance adjustments, deferred tax liabilities and the impact of prior tax election changes can be found in our Form 10-K filing. We reported a net loss of $4 million or negative $0.09 per share in the fourth quarter compared to a net loss of $6 million or negative $0.12 per share in the fourth quarter of 2023. In the fourth quarter, we produced EBITDA, or Earnings Before Interest, Taxes, Depreciation, and Amortization, of negative $3 million, compared to EBITDA of $9 million for the fourth quarter of 2023.
Cody: More information regarding the changes in our effective tax rate valuation allowance adjustments deferred tax liabilities.
Cody: Impact of prior tax election changes can be found in our Form 10-K filings.
Cody: We reported a net loss of $4 million or negative <unk> <unk> per share in the fourth quarter.
Cody: <unk> to a net loss of $6 million.
Cody: Or negative <unk> 12 per share in the fourth quarter of 2023.
Cody: In the fourth quarter, we produced EBITDA or earnings before interest taxes, depreciation and amortization of negative $3 million.
Speaker Change: Baird to EBITDA of $9 million for the fourth quarter of 2023.
Cody Gallarda: Now to touch on segment performance for the fourth quarter. Our civil segment had revenues of $104 million, a decrease of $4 million from the fourth quarter of 2023. Our civil segment's gross profit was $8 million, a decrease from $25 million from the fourth quarter of 2023. As a percentage of revenue for the quarter, our civil segment had gross profit margin of 8% compared to 23% in the fourth quarter of 2023. For the quarter, our transportation segment had revenues of $163 million, a decrease from $208 million from the fourth quarter of 2023. Our transportation segment's gross loss was $0.4 million, an improvement from a gross loss of $3 million in the fourth quarter of 2023.
Speaker Change: Now to touch on segment performance for the fourth quarter.
Speaker Change: Our civil segment had revenues of $104 million.
Speaker Change: A decrease of $4 million from the fourth quarter of 2023, our civil segment's gross profit was $8 million a.
<unk> from $25 million from the fourth quarter of 2023 as.
Speaker Change: As a percentage of revenue for the quarter, our civil segment had gross profit margin of 8% compared to 23% in the fourth quarter of 2023.
Speaker Change: For the quarter, our transportation segment had revenues of $163 million.
Speaker Change: A decrease from $208 million from the fourth quarter of 2023 or.
Speaker Change: Our transportation segments gross loss was <unk> 4 million an improvement from a gross loss of $3 million in the fourth quarter of 2023.
Cody Gallarda: As a percentage of revenue for the quarter, our transportation segment had a gross profit margin of negative 0.2% compared to negative 1.6% for the fourth quarter of 2023. Within the transportation segment, the M&P business line contributed $36 million to revenue and approximately negative $8 million to gross profit in the fourth quarter. Our core operating results in this segment, which excludes M&P, would have been $127 million of revenue and $8 million of gross profit for a gross profit margin of approximately 6%. Consolidated core results in the quarter, which excludes M&P, would have been $231 million of revenue and approximately $15 million of gross profit for an approximate gross profit margin percentage of 6.5%.
Speaker Change: As a percentage of revenue for the quarter, our transportation segment had a gross profit margin of negative 2% compared to negative one 6% for the fourth quarter of 2023.
Speaker Change: Within the transportation segment.
Speaker Change: <unk> business line contributed $36 million to revenue and approximately negative $8 million to gross profit in the fourth quarter.
Speaker Change: Our core operating results in this segment, which excludes MMP would have been $127 million of revenue and $8 million of gross profit for a gross profit margin of approximately 6%.
Speaker Change: Consolidated core results in the quarter, which excludes MLP would have been $231 million of revenue and approximately $15 million of gross profit for an approximate gross profit margin percentage of six 5%.
Cody Gallarda: Now to touch on results for the full year ended December 31, 2024. Our full year revenue was $980 million, down from the full year 2023. Gross profit for the full year ended December 31, 2024, was negative $63 million, a decrease from a positive $36 million from the full year 2023. Our gross loss margin was negative 6.4% in 2024, compared to a positive 3.1% in 2023. SG&A expenses for the year ended December 31, 2024 were $63 million, a decrease of $4 million compared to the prior year. The decrease was primarily driven by a decrease in compensation related expenses.
Speaker Change: Now to touch on results for the full year ended December 31 2024.
Speaker Change: Our full year revenue was $980 million.
Speaker Change: Down from the full year 2023.
Speaker Change: Gross profit for the full year ended December 31, 2024 was negative $63 million.
Speaker Change: A decrease from a positive $36 million from the full year 2023 or.
Speaker Change: Our gross loss margin was negative six 4% in 2024 compared to a positive three 1% in 2023.
Speaker Change: SG&A expenses for the year ended December 31, 2024 were $63 million.
Speaker Change: A decrease of $4 million compared to the prior year. The decrease was primarily driven by a decrease in compensation related expenses.
Cody Gallarda: SG&A expenses as a percentage of revenue were 6.5% for the year ending December 31, 2024, compared to 5.8% for the full year 2023. Interest expense for the year ended December 31, 2024, was $30 million, an increase of $10 million compared to 2023. The difference was attributable to increased borrowing costs and higher debt balance. We reported an income tax benefit for the year of $47 million on a pre-tax loss of $152 million, which represents an effective tax rate of 31%. This compares to a tax benefit of $9 million on a pre-tax loss of $27 million, also for an effective tax rate of 31% in 2023.
Speaker Change: SG&A expenses as a percentage of revenue were six 5% for the year ending December 31, 2024, compared to five 8% for the full year 2023.
Speaker Change: Interest expense for the year ended December 31, 2024, with $30 million, an increase of $10 million compared to 2023.
Speaker Change: The difference was attributable to increased borrowing costs and higher debt balances.
Speaker Change: We reported an income tax benefit for the year of $47 million on a pre tax loss of $152 million.
Speaker Change: This represents an effective tax rate of 31%.
Speaker Change: This compares to a tax benefit of $9 million on a pre tax loss of $27 million.
Speaker Change: Also for an effective tax rate of 31% in 2023.
Cody Gallarda: As discussed on prior calls, our 2023 tax position was impacted by numerous revocations of subchapter S elections, which were no longer available to us. More information around the revocation of the S-Election, valuation allowance changes, GILTI inclusions, and more can be found in our recently filed Form 10-K.
Speaker Change: As discussed on prior calls our 2023 tax position was impacted by numerous revocations or sub chapter S elections, which were no longer available to us more information around the replication of the selection valuation allowance changes guilty inclusions and more.
Speaker Change: <unk> can be found in our recently filed Form 10-K.
Cody Gallarda: On a go-forward basis, we expect the tax rate to be in the 20% to 24% range, depending on certain tax credits, non-deductible items, and certain state, local, and international tax For more information visit www.fema.gov We reported a gap net loss of $105 million or negative $2.19 per share in the year compared to a net loss of $19 million or negative $0.41 per share last year. For the year ended December 31, 2024, we reported an adjusted net loss of $105 million or negative $2.19 per share. This compares to an adjusted net loss of $39 million or negative $0.82 per share in 2023 after backing out other income from changes in the fair value of an earn out liability for 2023 offset by transaction related expenses.
Speaker Change: On a go forward basis, we expect the tax rate to be in the 20% to 24% range, depending on certain tax credits nondeductible items.
Speaker Change: State local and international taxes.
Speaker Change: We reported a GAAP net loss of $105 million or.
Speaker Change: Or negative $2 19 per share in the year compared to a net loss of $19 million or negative <unk> 41 per share last year for the year ended December 31, 2024, we reported an adjusted net loss of $105 million or negative $2 19 per share.
Speaker Change: This compares to an adjusted net loss of $39 million or negative <unk> 82 per share in 2023 after backing out other income from changes in the fair value of an earn out liability for 2023 offset by transaction related expenses.
Cody Gallarda: Now to touch on our segment performance for the full year ended 2024. For the full year ending December 31, 2024, our civil segment had revenues of $323 million, a decrease of $14 million from full year 2023. Our civil segment gross profit for the year was $17 million, a decrease from $52 million from full year 2023. As a percentage of revenue for the full year ended 2024, our civil segment had gross profit margin of 5.2% compared to 15.3% for 2023.
Speaker Change: Now to touch on our segment performance for the full year ended 2024.
Speaker Change: For the full year ending December 31, 2020 for our civil segment had revenues of $323 million.
Speaker Change: A decrease of $14 million from full year 2023.
Speaker Change: Our civil segment gross profit for the year was $17 million.
Speaker Change: A decrease from $52 million from full year 2023.
Speaker Change: As a percentage of revenue for the full year ended 2020 for our civil segment had gross profit margin of five 2% compared to 15, 3% for 2023.
Cody Gallarda: For the full year ending December 31, 2024, our transportation segment had revenues of $657 million, a decrease of approximately $166 million from full year 2023. Our transportation segment gross loss for the year was $80 million, compared to a gross loss of $16 million from full year 2023. As a percentage of revenue for the full year ended 2024, our transportation segment had growth profit margins of negative 12% compared to negative 1.9% in 2023. Within the transportation segment, the M&P business line contributed $101 million to revenue and negative $83 million to gross profit in 2024. are core operating results in this segment, which excludes M&P with $556 million of revenue and $3 million of gross profit.
Speaker Change: For the full year ending December 31, 2020 for our transportation segment had revenues of $657 million.
Speaker Change: A decrease of approximately $166 million from full year 2023.
Speaker Change: Our transportation segment gross loss for the year was 80 million.
Speaker Change: <unk> to a gross loss of $16 million from full year 2023.
Speaker Change: As a percentage of revenue for the full year ended 2020 for our transportation segment had gross profit margin of negative 12% compared to negative one 9% in 2023.
Speaker Change: Within the transportation segment, the MMP business line contributed $101 million to revenue and negative $83 million to gross profit in 2024.
Speaker Change: Our core operating results in this segment, which exclude MMP was $556 million of revenue and $3 million of gross profit.
Cody Gallarda: Consolidated core results in the year, excluding M&P, would have been $879 million of revenue and $20 million of gross profit.
Speaker Change: Consolidated core results for the year, excluding MMP would have been $879 million of revenue and $20 million of gross profit.
Cody Gallarda: As of December 31, 2024. MNP backlog makes up approximately $163 million, and non-MNP legacy work makes up approximately $83 million. Said differently, our legacy and M&P backlog makes up less than 10% of our total backlog and we are optimistic about the results expected to be produced from $2.3 billion of new core backlog.
Speaker Change: As of December 31, 2024.
Speaker Change: MMP backlog makes up approximately $163 million and non MMP legacy work makes up approximately $83 million of backlog said differently, our legacy and MMP backlog makes up less than 10% of our total backlog and we are optimistic about the result.
Speaker Change: It's expected to be produced from $2 3 billion of new core backlog.
Cody Gallarda: Turning to the balance sheet, as of December 31, 2024, we finished the year with net debt of $213 million, inclusive of cash and restricted cash of $88 million. We ended 2024 with just under $2.6 billion in backlog, and we expect to burn approximately 39% of this backlog in 2025.
Speaker Change: Turning to the balance sheet as of December 31, 2024, we finished the year with net debt of $213 million.
Speaker Change: Inclusive of cash and restricted cash of $88 million.
Speaker Change: We ended 2024 with just under $2 6 billion in backlog and.
Speaker Change: And we expect to burn approximately 39% of this backlog in 2025.
Cody Gallarda: Thank you for your time and interest in Southland.
Speaker Change: Thank you for your time and interest in southwest I'll now pass the call back to the operator for your questions.
Ri: I'll now pass the call back to the operator for your question. Thank you.
Speaker Change: Yes.
Speaker Change: Thank you.
Ri: Ladies and gentlemen, we will now begin the question and answer session. Should you have a question please press the star followed by the number one on your touchtone phone and if you will hear a prompt that your hand has been raised. Should you wish to decline from the polling process, please press the star followed by number two.
Speaker Change: Ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press the star followed by the number one on your Touchtone phone and if you will hear prompts that Johannes been raised.
Speaker Change: Should you wish to decline from the polling process. Please press the star followed by Monday June.
Ri: If you're using a speakerphone, please lift the handset before pressing any key. One moment, please, for your first question.
Speaker Change: If you're using a speaker phone.
Speaker Change: Please lift the handset before pressing any keys.
Speaker Change: One moment. Please for your first question.
Adam Thalhimer: Your first question comes from Adam Thalhimer from Thompson Davis. Please go ahead. Morning, guys. Morning Adam. Hey Cody, I just wanted to follow up on or start where you left off which is the 39% of the backlog burns in 2025. Curious how you see the... Book and burn work trending this year.
Speaker Change: Your first question comes from Adam.
Matt: Hi, Matt from Thompson Davis. Please go ahead.
Speaker Change: Morning, guys.
Matt: Good morning, Adam wanted to Adam.
Tony: Hey, Tony I, just wanted to follow up on <unk>.
Tony: Where you left off which is the 39% of the backlog Burns in 2025, I'm curious how you see the.
Tony: Book and burn work trending this year.
Cody Gallarda: Yeah, so I'll, I'll start and then let Frank lead into where he sees the bidding activity going. You know, obviously, we had a lower, lower than one book to burn ratio in Q4, but are excited about the $100 million that we did pick up. We do expect to see that back-weighted cadence that we've seen in prior years, and are looking forward to announcing some impressive wins in 2025. Yeah, Adam, and I guess, you know, this is a place to kind of address the, you know, maybe why not more awards, as we see the market, you know, is really healthy.
Tony: Yes, so I'll start and then let Frank lead into where he sees the bidding activity going.
Tony: Obviously, we had a lower lower than one book to burn ratio in Q4, but are excited about the $100 million that we did pick up we do expect to see that back weighted cadence that we've seen in prior years and are looking forward to announcing some impressive wins in 'twenty five.
Tony: Yes, Adam.
Tony: Yes.
Tony: This is the place to kind of address.
Tony: Maybe why not more awards.
Tony: We see the market is really healthy and.
Frank Renda: And we don't see the demand slowing anytime soon. You know, we've been winding down a business unit that was over 30% of our backlog. And our focus was on completing, you know, this transition and returning to higher profitability. We're adding work in a disciplined manner, ensuring that we have the right resources for the projects and prioritizing high quality backlog in our core market. where we have historically performed very well. Demand is really good, and we expect this trend to continue. We're confident in winning our fair share of new projects. And we remain committed to protecting margins rather than pursuing growth at any cost.
Tony: And we don't see the demand slowing anytime soon we've been winding down a business unit that was over 30% of our backlog and our focus was on completing this transition in returning to higher profitability.
Tony: We're adding work in a disciplined manner, ensuring that we have the right resources for the projects and prioritizing high quality backlog in our core markets.
Tony: Where we have historically performed very well demand is really good and we expect this trend to continue.
Tony: We're confident in winning our fair share of new projects, and we remain committed to protecting margins rather than pursuing growth at any cost.
Cody Gallarda: The timing of these new awards, you know, could be a little bit uneven. We expect new awards to really pick up in the back half of the year. We also have approximately $750 million in pending alternative delivery contracts. And, you know, we're confident that these will convert into construction awards. Got it. And then just thinking about how the street and myself are going to model. Ibada this year.
Tony: The timing of these new awards could be can be a little bit uneven and we expect new awards to really pick up in the back half of the year.
Tony: We also.
Tony: We have approximately $750 million in pending alternative delivery contracts and we're confident that these will convert into into construction awards.
Tony: Got it.
Tony: And then.
Tony: Just thinking about how the street and myself are going to model.
Tony: EBITDA this year.
Cody Gallarda: As we sit here in March, I mean, is the expectation for the full year that we'll have a positive EBITDA and maybe you can comment on how you see the quarterly cadence shaking? Yeah, so I'll... echo some of what we mentioned on our last call, Adam, is we expect to return to positive EBITDA numbers by the end of this year, whether that means you know, Q1 looks positive, Q2 looks positive. They're leading to your question. There are some unknowns around the cadence of that, but with the decreasing legacy in M&P backlog, which is down to less than 10%, what we've picked up in new work and potential and expected new awards going into the end of the year, we're looking forward to a much stronger finish to 25.
Tony: As we sit here in March I mean is the expectation for the full year that will have positive EBITDA and maybe you can comment on how you see the quarterly cadence shaken out.
Speaker Change: Yes, so ill.
Speaker Change: Echo some of what we mentioned on our last call. Adam is we expect to return to positive EBITDA numbers by the end of this year, whether that means keeping up.
Speaker Change: Q1 was positive Q2 was positive either meeting to your question. There are some unknowns around the cadence of that but with the the.
Speaker Change: Decreasing legacy and MMP backlog, which is down to less than 10%, what we picked up a new work and potential unexpected new awards going into the end of the year we were.
Speaker Change: We're looking forward to a much stronger finish to 'twenty five.
Cody Gallarda: Great.
Cody Gallarda: And then just lastly for me. The process of bringing down contract assets, does that? really ramp up as 2025 progresses. So there's a couple of different ways to look at that question, Adam. I want to address it from both the contract asset side in the context of the net contract position side, which takes out contract liabilities. When you look at where contract assets have been over the last couple years, we've had meaningful decreases with collections, you know, as well as some of the unfortunate profit fades that we've had. But I really want to highlight the significant growth that we've seen in contract liabilities, which offsets that net.
Speaker Change: Great and then just lastly for me.
Speaker Change: The process of bringing down contract assets does that.
Speaker Change: Really ramp up as 2025 progresses.
Speaker Change: So.
Speaker Change: There's a couple of different ways to look at that question, Adam I wanted to address it from both the contract asset side in the context of the.
Speaker Change: The net contract position side, which that takes out contract liabilities.
Speaker Change: When you look at where contract assets has been over the last couple of years, we've had meaningful decreases with collections as well as some of the unfortunate profit saves that we've had but I really want to highlight the significant growth that we've seen in contract liabilities, which offsets that net.
Cody Gallarda: balance sheet position. So looking at it from a net perspective, you know, we're slightly over $200 million of net contract position at year end. So I bring that up to say, to prove, to make two points. The first being, you know, everything that Frank has commented and we've shared and been talking about publicly on new work, having positive upfront cash flows is being realized. But then also to directly answer your question, there can be an increase in contract assets as we pursue closing out some of these troubled jobs where there are claim pursuits. So want to be transparent on both sides of that equation.
Speaker Change: Sheet position.
Speaker Change: So looking at it from a net perspective, we're slightly over $200 million of net.
Speaker Change: Net contract position at year end, so I bring that up to say.
Speaker Change: Bruce to make two points the first being everything that Frank has commented and we've shared I've been talking about publicly on new work, having positive upfront cash flows is being realized.
Speaker Change: But then also to directly answer your question there can be an increase in contract assets as we pursue closing out some of these troubled jobs, where there are where they are our claim pursuits. So want to be transparent on both sides of that equation.
Frank Renda: Yeah. And I think on the claims, Adam, you know, most of these claims were on jobs that happened. 2017, 18, and 19. And so, you know, we're at the table on a lot of those claims. And, you know, we continue to work through and make small progress on settling the legacy claims. No major updates, I guess, on larger claims to report this quarter, but we do expect a significant amount of cash flow from these claims in the coming quarters. That should take that number down.
Speaker Change: And I think on the on the claims out of most of these these claims were on jobs that happened in that.
Speaker Change: 2017, 18, and 19 and so we're at the table and a lot of those claims and we continue to work through and make small progress on settling the legacy claims.
Speaker Change: No major updates I guess on larger claims to report this quarter, but we do expect a significant amount of cash flow from these claims in the coming quarters.
Speaker Change: That should that should take that number down.
Cody Gallarda: Great. Thank you. Thanks guys, good luck in Q1. Thanks, Adam. Thank you.
Speaker Change: Great.
Speaker Change: Thanks, guys. Good luck in Q1.
Speaker Change: Thanks, Adam Thanks, Adam.
Speaker Change: Thank you. Your next question comes from Julio Romero from Sidoti <unk> Company. Please go ahead.
Julio Romero: Your next question comes from Julio Romero from Sidoti Company. Please go ahead. Thanks. Hey, good morning, Frank, Cody, Alex. um, more maybe to start. Hey, good morning. On the civil segment, you know, solid performance there and a nice sequential rebound from the third quarter. Can you maybe just talk about the drivers of the gross profit there? And I guess you did realize less issues on non-M&P legacy work in the fourth quarter compared to the Yeah, I guess first on the civil margins, you know, really excited about the civil work. We picked up some great civil projects over the last couple of quarters.
Speaker Change: Thanks, Hey, good morning, Frank <unk> Alex.
Speaker Change: Good morning, maybe just start.
Speaker Change: Hey, good morning on the civil segment.
Speaker Change: Solid performance, there and a nice sequential rebound from the third quarter can you maybe just talk about the drivers of the gross profit there and I guess you did realize less issues on non MLP legacy work in the fourth quarter compared to the third quarter.
Speaker Change: Yes, I guess first on the civil margins really excited about the civil work, we picked up some some great civil projects over the over the last couple of quarters.
Frank Renda: And, you know, unfortunately, we had an unfavorable ruling on a dispute on a legacy civil project that significantly impacted results this quarter. But the core work continues to produce strong double-digit margins. We also continue to pick up smaller, quick-burning civil projects that strong margins and just feel really, really good about about where we're at in the civil sector. On the legacy updates, our non-MNP legacy backlog has been reduced to around $80 million, and a significant portion of the challenges we faced in this portfolio during 2024 stemmed from a bridge project in the Midwest. We recently achieved a major milestone by opening this new bridge.
Speaker Change: Unfortunately, we had an unfavorable ruling on a dispute on a legacy civil projects that significantly impacted results this quarter, but the core work continues to produce strong double digit margins. We also continue to pick up smaller quick burning civil projects that are producing strong margins.
Speaker Change: Feel really really good about.
Speaker Change: About where we're at in the civil sector.
Speaker Change: On the legacy updates are non MLP legacy backlog has been reduced.
Speaker Change: Around $80 million and a significant portion of the challenges we faced in this portfolio during 2024 stems from a bridge projects in the Midwest. We recently achieved a major milestone milestone by opening this new bridge.
Frank Renda: There's some demolition work that remains, but reaching this milestone is a significant step forward for us. And it meaningfully reduces the risk of further project fate on this. Got it. That's helpful. And then, you know, that non-MNP legacy number went down by $22 million compared to the last quarter. Is that due to the unfavorable ruling on the dispute you just mentioned, or is that due to the bridge project in the Midwest? Just trying to think about that number there. Are you speaking specifically to the civil segment, Julio? I'm just speaking, I should speak about non-MMP legacy, probably more broadly.
Speaker Change: There are some demolition work that remains but reaching this milestone is a significant step forward for us and it meaningfully reduces the risk of further project on this project.
Speaker Change: Got it that's helpful and then.
Speaker Change: Non empty legacy number went down by $22 million compared to last quarter.
Speaker Change: Is that is that due to the unfavorable ruling on the dispute.
Speaker Change: You just mentioned or is that due to the bridge projects in the Midwest.
Speaker Change: Just trying to think about that number there.
Julio: Are you speaking specifically to the civil segment Julio.
Julio: I'm, just not I should speak about non MB legacy probably more broadly.
Frank Renda: Non-MMP legacy, okay, thank you. So, and we were down from. Yeah, so I think we're at 105 last. Yes, so, progressing work. And as time moves on, that number is going to continue to dwindle from a backlog perspective. And then, if I understood maybe a nuance of the other part of your question, there's some additional detail into the profit activity. Got it. I'm just trying to get a sense for 22 million and a quarter. Should we be through this non MMP legacy by by end of 25 or or does it go up longer than that?
Julio: Okay. Thank.
Julio: Thank you.
Julio: So we were down from.
Julio: Yes.
Julio: 105 last quarter.
Julio: Yes.
Julio: Progressing work.
Julio: And as time moves on that number is going to continue to dwindle from us from a backlog perspective and then.
Julio: And maybe a nuance of the other part of your question. There are some additional detail into the profit activity in the MD&A that we filed last night.
Julio: Got it I'm, just trying to get a sense for $22 million a quarter should we be through this non MEP legacy bi by end of 'twenty, five or where does it go out longer than that.
Cody Gallarda: So we do expect to complete the majority of the non-legacy M&P work by the end of 2025. There is one project that can tail into 2026 that we're working to accelerate, but no additional commentary beyond that. Okay, gotcha. And then I guess. You know, how should we be expecting cash flow to trend in 20... Yes, so we certainly do expect to produce strong cash flow from operations in 25. As you've seen that that turn over time happening. There's definitely going to be seasonality that you see with cash flow more weighted towards the back half of the year.
Julio: So we do expect to complete the majority of the non legacy MMP work by the end of 2025. There is one project that can tail into 2026.
Julio: That we're working to accelerate but no additional commentary beyond that at this time.
Julio: Okay got you and then.
Julio: I guess.
Julio: How should we be expecting cash flow to trend in 'twenty five.
Julio: Yes, so we certainly do expect to produce strong cash flow from operations and 25 is <unk> seen that turn overtime happening, there's definitely going to be seasonality that you see with cash flow more weighted towards the back half of the year.
Cody Gallarda: Think of the meaningful driver behind that is going to be new core project contribution that continues to contribute at very healthy margins, but can be swayed by dispute resolution, dispute resolutions on some of our legacy projects. But all of that being said, we expect to generate strong cash flow from operations. Got it. Very helpful. I'll pass it on. Thank you. As a reminder, if you wish to ask a question, please press star one.
Julio: Think of the meaningful driver behind that is going to be new core project contribution that continues to contribute very.
Julio: Very healthy margins.
Julio: But can be swayed by dispute resolution dispute resolutions on some of our legacy projects.
Julio: But all of that being said, we expect to generate strong cash flow from operations. This year.
Julio: Got it.
Julio: Very helpful I'll pass it on thank you.
Julio: Thank you.
Speaker Change: As a reminder, if you wish to ask a question. Please press star one.
Christian Schwab: Your next question comes from Christian Schwab from Craig Howlum Capital Group. Please go ahead. Thanks for taking my question.
Julio: Question comes from Christian Schwab from Craig Hallum Capital Group.
Speaker Change: Please go ahead.
Speaker Change: Great. Thanks for taking my question.
Frank Renda: So I guess I need to ask, you know, with the kind of fast pace of change that's going on in our government today, and people being told they can't get money or may not get federal funding money, are you guys seeing Any anxiety about some of these projects that you're excited about that that maybe those funds will not be able to be allocated to them? Hey, good morning, Christian. Great, great question, you know. listen to, you know, kind of listen to the administration speech last night and heard some some really positive things in there. And, you know, some things that they got you thinking.
Speaker Change: I guess I need to ask you you know.
Speaker Change: With the kind of pace of change that's going on in government today.
Speaker Change: And people being told they can't get money, you may not get federal funding money or.
Speaker Change: Are you seeing.
Speaker Change: Any anxiety about some of these projects that you're excited about that maybe those funds will not be able to be allocated to them.
Christian Schwab: Hey, good morning, Christian Great Great question.
Speaker Change: Yes.
Speaker Change: Listen to kind of listen to the administration's speech last night and heard some some really positive things in there and.
Frank Renda: But the good thing about the kind of work that we do is it benefits a lot of communities in both sides of the aisle. And we all know how critical this work is for our country. You know, we've put it off for a long time. And As we sit today, we don't expect any recent spending cuts from DOJ to materially impact our business. In fact, we're optimistic about the ideas coming from this administration about cutting down on some of the red tape to get these projects off the ground. If they're able to come through with that, it'll be beneficial to our business.
Speaker Change: Some things that got you think input.
Speaker Change: The good thing about the kind of work that we do as it benefits a lot of communities in both sides of the aisle and we all know how critical this work is for our country. We've put it off for a long time.
Speaker Change: As we sit today, we do not we don't expect any receipts been the cuts from from dose to materially impact our business in fact.
Speaker Change: We're optimistic about the ideas coming from this administration about.
Speaker Change: Cutting down on some of the red tape to get these projects off the ground, if we're able to come through with that and it will be beneficial to our business and we are in.
Frank Renda: And we're in the middle innings of IIJ spending. And we expect that to be a tailwind for our business for many years to come. and even at the state level, Texas and Florida just continue to have historic levels of spending. You know, overall, we just feel really good about the pipeline and opportunities out there and expect to win our fair share of them. You know, the other things that, you know, we heard last night were manufacturing and bringing some of that back and, you know, maybe some tax cuts on that end. But one thing that we do, Christian, that a lot of groups don't do is, you know, we manufacture our own TBMs. We manufacture our own steel.
Speaker Change: We're in the middle innings of IRI, J spending and we expect that to be a tailwind for our business for many years to come.
Speaker Change: And even at the state level, Texas, and Florida, just continue to have historic levels of spin. The overall, we just feel really good about the pipeline and opportunities out there.
Speaker Change: To win our fair share of them.
Speaker Change: The other things that we heard last night, we're manufacturing and bringing some of that back and.
Christian Schwab: Maybe some tax cuts on that end, but one thing we do Christian that a lot of groups don't do we manufacture our own tbms.
Speaker Change: Manufacture our own steel.
Speaker Change: So support some gates false work in.
Frank Renda: support, you know, some gates, false work, and. if if there were to be you know some some cutbacks and tariffs I think that's a that's an avenue that we have a real advantage on as well. So we feel optimistic about the future. Fantastic. Another question. Thanks, guys. Thanks, Christian. Appreciate it. Thank you.
Speaker Change: If there were to be some cutbacks in tariffs I think thats a.
Speaker Change: And Thats an avenue that we have a real advantage on as well so we feel optimistic about the future.
Speaker Change: Fantastic one other question thanks, guys.
Speaker Change: Thanks, Chris I appreciate it.
Speaker Change: Thank you. Our next question comes from Brent Thielman from Davidson. Please go ahead.
Brent Thielman: Your next question comes from Brent Thielman from Davidson. Please go ahead. Hey, guys. Yeah, I guess a question just direct impact of Paris, overall disruption to supply chain. I mean, we're starting to Steel prices move a lot higher. costs for things that you guys use. today. Projects, maybe you can just talk about your position on contracts. In light of that, you know, is there risk, are you protected? Yeah, thanks.
Brent Thielman: Hey, guys.
Brent Thielman: Yes, I just had a question just in terms of the direct or indirect impact of tariffs overall disruption to supply chain I mean, we're starting to see.
Brent Thielman: Steel prices move a lot higher can be some upward pressure around either.
Speaker Change: Sure things that you guys use in your day to day projects. Maybe you can just talk about your positioning on contracts in light of that.
Brent Thielman: Rich can you protected.
Brent Thielman: It'd be helpful to hear.
Brent Thielman: Yes, thanks, good morning.
Frank Renda: Good morning. You know, on tariffs, the good thing about a majority of our projects is we're required to procure made in America materials already. So we're already purchasing products in the U.S. and we really have minimal cross-border exposure. We try to lock in our material pricing for large purchase orders at the beginning of projects, but you know, monitoring the new developments here and taking it into consideration on new bids. Overall, we do not expect this to have a material impact on the business. You know, of course, on some materials and parts for equipment, you know, we've got a little bit of exposure out there, but again, don't expect it to have a material impact on the business at this point.
Speaker Change: Tariffs the good thing about a majority of our projects as we are required to procure made in America materials already so we're already purchasing products in the U S.
Speaker Change: And we really have minimal cross border exposure.
Speaker Change: We try to work in our material pricing large large purchase orders at the beginning of the project.
Speaker Change: We're monitoring the new developments here to take it into consideration on new bids overall, we do not expect this to have a material impact on the business of course.
Speaker Change: Some.
Speaker Change: Materials and parts for equipment, we've got a little bit of exposure out there, but again don't expect it to have a material impact on the business at this point.
Frank Renda: Okay, maybe just from a seasonal perspective, certainly heard some things from other companies. a rough start to the year. I don't know if you guys could comment on that, you know, I know there's been some weather down in and more unusual than you've seen in prior years, or things. Yeah, a couple things, you know, obviously, we had a, you know, we had a couple of storms kind of come through. You know, we've had an unusual weather pattern, I guess, that has affected us a little bit, but, you know, as far as seasonality, you know, we expect an uptick in new work starts and really getting into some of the larger projects, you know, that I kind of touched on in the remarks, like the Shands Bridge, and the Kennedy Bridge there in New York to really start producing some material results later on.
Speaker Change: Okay, and maybe just from a seasonal perspective, certainly heard some things from other companies.
Speaker Change: The rough start to the year I don't know if you guys could comment on that.
Speaker Change: It's been some weather down in Texas among other places.
Speaker Change: Is it.
Speaker Change: And more unusual than you've seen in prior years or things to consider there.
Speaker Change: Yes couple of things, obviously, we had a.
Speaker Change: We had a couple of.
Speaker Change: Storms kind of come through.
Speaker Change: We've had some unusual weather pattern I guess that.
Speaker Change: Has affected us.
Speaker Change: A little bit but.
Speaker Change: As far as seasonality, we expect we expect an uptick in new work starts and really getting into some of the larger projects that I kind of touched on in his remarks like the <unk> bridge.
Speaker Change: Yes.
Speaker Change: The Kennedy bridge there.
Speaker Change: New York to really start producing some material results later on in the year.
Frank Renda: And I would say, good morning Brent, I would say that what we can continue to and expect to continue to be impacted by weather in various geographies in which we work. But I think if you look at the dispersion of projects that we have currently active, we don't expect all areas of the country in North America that we work in to be hit at the same time. So hopefully, there is minimal disruption across the industry for us and for all of our competitors with respect to weather. But to the extent there likely will be, we believe we'll certainly have continuing operations in other areas that are.
I would say good.
Brett: Good morning, Brett.
Speaker Change: I would say that.
Speaker Change: Well, we can continue to and expect to continue to be impacted by weather and various.
Speaker Change: Geographies in which we work, but I think if you look at the dispersion of projects that we have currently active.
Speaker Change: We don't think we.
Speaker Change: We don't expect all areas of the country in North America that we work in to be hit at the same time so.
Speaker Change: Hopefully there are minimal disruption across the industry for us and for all of our competitors with respect to weather, but to the extent there likely will be.
Brent Thielman: We believe we will certainly have continuing operations and other areas that are unaffected Brent about the last thing that I expected going into this year was 11 inches of snow on the ground in Beaumont.
Frank Renda: Brent, about the last thing that I expected going into this year was 11 inches of snow on the ground in Beaumont, Texas, in Lake Charles, Louisiana. It was quite a scene on our two projects out there. Sure, always subscribing to the kids, appreciate it guys. Thank you.
Speaker Change: Texas in Lake Charles Louisiana.
It was it was quite as seen in our on our two projects out there.
Speaker Change: Sure Scott when the kids.
Speaker Change: Hey, guys. Thank you.
Speaker Change: Thanks, Greg.
Speaker Change: Thank you.
Ri: There are no further questions at this time.
Speaker Change: There are no further questions at this time I will now hand, the call over to Frank Miranda. Please continue.
Frank Renda: I will now hand the call over to Frank Renda. Please continue. Hey, thanks everyone for joining today and thanks for your interest in Southland and look forward to talking again next quarter.
Speaker Change: Hey, thanks, everyone for joining today and thanks for your interest in Southland and look forward to talking to you again next quarter.
Frank Renda: Have a great day.
Speaker Change: Great day.
Ri: Thank you, ladies and gentlemen. Today's conference call has concluded. Thank you for your participation.
Speaker Change: Thank you, ladies and gentlemen, todays conference call has concluded. Thank you for your participation you may now disconnect.
Ri: You may now disconnect.