Q1 2026 NWPX Infrastructure Earnings Call

April 30, 2026

Operator: Greetings, and welcome to the NWPX Infrastructure Q1 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Scott Montross, President and CEO. Please go ahead, sir.

Speaker #1: And welcome to the NWPX Infrastructure First Quarter 2026 Earnings Conference Call. At this time, all participants are in the listen-only mode. A question-and-answer session will follow the formal presentation.

Speaker #1: If anyone should require operator assistance, please press star 0 on your telephone keypad. As a reminder, this conference is being recorded. It is now my pleasure to introduce Scott Montross, President and CEO; please go ahead, sir.

Speaker #2: Good morning and welcome to NWPX's First Quarter 2026 Earnings Conference Call. My name is Scott Montross, and I'm President and CEO of the company.

Scott Montross: Good morning, welcome to NWPX's Q1 2026 Earnings Conference Call. My name is Scott Montross, and I'm President and Chief Executive Officer of the company. I'm joined today by Aaron Wilkins, our Chief Financial Officer. By now, all of you should have access to our earnings press release, which was issued yesterday, 29 April, at approximately 4:00 PM Eastern Time. This call is being webcast, and it is available for replay. As we begin, I'd like to remind everyone that statements made on this call regarding our expectations for the future are forward-looking statements, and actual results could differ materially. Please refer to our most recent Form 10-K for the year ended 31 December 2025, and in our other SEC filings for a discussion of such risk factors that could cause actual results to differ materially from our expectations.

Scott Montross: Good morning, welcome to NWPX's Q1 2026 Earnings Conference Call. My name is Scott Montross, and I'm President and Chief Executive Officer of the company. I'm joined today by Aaron Wilkins, our Chief Financial Officer. By now, all of you should have access to our earnings press release, which was issued yesterday, 29 April, at approximately 4:00PM Eastern Time. This call is being webcast, and it is available for replay. As we begin, I'd like to remind everyone that statements made on this call regarding our expectations for the future are forward-looking statements, and actual results could differ materially. Please refer to our most recent Form 10-K for the year ended 31 December 2025, and in our other SEC filings for a discussion of such risk factors that could cause actual results to differ materially from our expectations.

Speaker #2: I'm joined today by Aaron Wilkins, our Chief Financial Officer. By now, all of you should have access to our earnings press release which was issued yesterday, April 29th, at approximately 4:00 PM Eastern Time.

Speaker #2: This call is being webcast, and it is available for replay. As we begin, I'd like to remind everyone that statements made on this call regarding our expectations for the future are forward-looking statements.

Speaker #2: An actual result could differ materially. Please refer to our most recent Form 10-K for the year-ended December 31st, 2025, and in our other SEC filings, for discussion of such risk factors that could cause actual results to differ materially from our expectations.

Speaker #2: We undertake no obligation to update any forward-looking statements. Thank you all for joining us today. I'll begin with a review of our first quarter performance, and our outlook for the second quarter of 2026.

Scott Montross: We undertake no obligation to update any forward-looking statements. Thank you all for joining us today. I'll begin with a review of our Q1 performance and our outlook for the Q2 of 2026, then Aaron will walk you through our financials in more detail. We delivered a strong start to 2026. Net sales were up 19% year over year to $138.3 million, reflecting meaningful growth across both our Water Transmission Systems and Precast businesses. Our strategy delivered record Q1 consolidated gross profit of $26.7 million, up 38% from last year, with our gross margin expanding 260 basis points year over year to 19.3%. That strength carried through to the bottom line, highlighting the operating leverage in our model and continued execution across the organization.

Speaker #2: And then Aaron will walk you through our financials in more detail. We delivered a strong start to 2026. Net sales were up 19% year over year, to $138.3 million.

Speaker #2: Reflecting meaningful growth across both our water transmission systems and precast businesses. Our strategy delivered record first quarter consolidated gross profit of $26.7 million, up 38% from last year, with our gross margin expanding 260 basis points year over year to 19.3%.

Speaker #2: That strength carried through to the bottom line highlighting the operating leverage in our model, and continued execution across the organization. We generated record first quarter profitability with earnings of $1.08 per share, and produced strong free cash flow of $25.7 million, or $2.62 per share.

Scott Montross: We generated record first quarter profitability with earnings of $1.08 per share and produced strong free cash flow of $25.7 million or $2.62 per share, reinforcing the strength and consistency of our earnings profile and the resilience of our cash flows. Turning to our WTS segment. Revenue reached a first quarter record of $93.5 million, up 19% year over year with strong margin improvement. Our performance reflected higher production volume with tons produced up 18%, supported by strong project execution. This growth came despite adverse weather that caused unscheduled downtime across three WTS facilities early in the quarter. Selling prices were up 1% year over year, driven by changes in product mix, and we also benefited from favorable project timing across several large water transmission jobs.

Speaker #1: Begin with a view of our first quarter performance, and our outlook for the second quarter of 2026. And then Aaron will walk you through our financials in more detail.

Speaker #2: Reinforcing the strength and consistency of our earnings profile and the resilience of our cash flows. Turning to our WTS segment. Revenue reached a first quarter record of $93.5 million.

Speaker #1: We delivered a strong start to 2026. Net sales were up 19% year over year, to $138.3 million. Reflecting meaningful growth across both our water transmission systems and precast businesses.

Speaker #2: Up 19% year over year, with strong margin reflected higher production volume with tons produced up 18%, supported by strong project execution. This growth came despite adverse weather that caused unscheduled downtime across three WTS facilities early in the quarter.

Speaker #1: Our strategy delivered record first quarter consolidated gross profit of $26.7 million, up 38% from last year, with our gross margin expanding 260 basis points year over year to $19.3%.

Speaker #2: Selling prices were up 1% year over year, driven by changes in product mix and we also benefited from favorable project timing across several large water transmission jobs.

Speaker #1: That strength carried through to the bottom line highlighting the operating leverage in our model, and continued execution across the organization. We generated record first quarter profitability with earnings of $1.08 per share, and produced strong free cash flow of $25.7 million, or $2.62 per share.

Speaker #2: In addition, we saw one of our strongest booking quarters to date with robust bidding activity and the emergence of a significant previously unplanned project that is under NDA, which will contribute positively to our 2026 results.

Scott Montross: In addition, we saw one of our strongest booking quarters to date with robust bidding activity and the emergence of a significant previously unplanned project that is under NDA, which will contribute positively to our 2026 results. All of which contributed to a substantial increase in our backlog, reinforcing the strength of demand across our markets. WTS backlog, including confirmed orders, ended the quarter at a record $430 million, up from $346 million at year-end and well above the $289 million level we reported this time last year. Looking ahead, we expect the 2026 bidding environment to be moderately stronger than 2025.

Speaker #1: Reinforcing the strength and consistency of our earnings profile and the resilience of our cash flows. Turning to our WTS segment, revenue reached a first quarter record of $93.5 million.

Speaker #2: All of which contributed to a substantial increase in our backlog. Reinforcing the strength of demand across our markets. WTS backlog, including confirmed orders ended the quarter at a record $430 million.

Speaker #1: Up 19% year over year, with strong margin improvement. Our performance reflected higher production volume, with tons produced up 18%, supported by strong project execution.

Speaker #2: Up from $346 million at year-end, and well above the $289 million level we reported this time last year. Looking ahead, we expect the 2026 bidding environment to be moderately stronger than 2025.

Speaker #1: This growth came despite adverse weather that caused unscheduled downtime across three WTS facilities early in the quarter. Selling prices were up 1% year over year, driven by changes in product mix and we also benefited from favorable project timing across several large water transmission jobs.

Speaker #2: WTS gross profit increased 42% year over year to $17.3 million, resulting in a gross margin of 18.5%, up 300 basis points from last year.

Scott Montross: WTS gross profit increased 42% year over year to $17.3 million, resulting in a gross margin of 18.5% of 300 basis points from last year. This improvement reflects higher volume supported by strong customer demand and the related efficiency gains in higher overhead absorption that come with that level of production, favorable product mix, and the overall solid operational execution across the segment. Turning to our Precast segment. Precast revenue increased 19% year over year to a new record Q1 level of $44.8 million. Our performance was driven by a 14% increase in selling prices from a favorable change in product mix and increased sales volume reflecting continued growth in the non-residential portion of our business.

Speaker #1: In addition, we saw one of our strongest booking quarters to date with robust billing activity and the emergence of a significant previously unplanned project that is under NDA, which will contribute positively to our 2026 results.

Speaker #2: This improvement reflects higher volume supported by strong customer demand, and the related efficiency gains in higher overhead absorption that come with that level of production, favorable product mix, and the overall solid operational execution across the segment.

Speaker #1: All of which contributed to a substantial increase in our backlog. Reinforcing the strength of demand across our markets. WTS backlog, including confirmed orders ended the quarter at a record $430 million.

Speaker #2: Now turning to our precast segment. Precast revenue increased 19% year over year, to a new record first quarter level of $44.8 million. Our performance was driven by a 14% increase in selling prices from a favorable change in product mix, an increased sales volume reflecting continued growth in the non-residential portion of our business.

Speaker #1: Up from $346 million at year-end, and well above the $289 million level we reported this time last year. Looking ahead, we expect the 2026 bidding environment to be moderately stronger than 2025.

Speaker #1: WTS gross profit increased 42% year over year to $17.3 million, resulting in a gross margin of $18.5%, up 300 basis points from last year.

Speaker #2: At Park Production increased 30% year over year, with strong growth in revenue per yard shipped. Despite borrowing costs that remain elevated as the Fed held interest rates steady in 2026.

Scott Montross: At Park, production increased 30% year over year, with strong growth in revenue per yard shipped, despite borrowing costs that remain elevated as the Fed held interest rates steady in 2026. We are continuing to see signs of improvement in the non-residential demand trajectory as we progress through 2026. Specifically related to data center projects that have been instrumental in buoying the commercial construction demand. At Geneva, production and shipments had solid year-over-year gains of 7% and 8% respectively. Despite seeing a moderate slowdown in the residential construction market, which has more than been offset by growth in Geneva's non-residential business. Leading indicators remained solid early in 2026, with the Dodge Momentum Index up 26% in March 2026 versus March 2025.

Speaker #1: This improvement reflects higher volume supported by strong customer demand and the related efficiency gains in higher overhead absorption that come with that level of production.

Speaker #2: We are continuing to see signs of improvement in the non-residential demand trajectory as we progress through 2026, specifically related to data center projects that have been instrumental in weighing the commercial construction demand.

Speaker #1: Favorable product mix and the overall solid operational execution across the segment. Now turn to our precast segment. Precast revenue increased 19% year over year, to a new record first quarter level of $44.8 million.

Speaker #2: At Geneva, production and shipments had a solid year-over-year gains of $7.8% respectively. Despite seeing a moderate slowdown in the residential construction market, which has more than been offset by growth in Geneva's non-residential business.

Scott Montross: Begin with a review of our Q1 performance and our outlook for the Q2 of 2026. Aaron will walk you through our financials in more detail. We delivered a strong start to 2026. Net sales were up 19% year over year to $138.3 million, reflecting meaningful growth across both our water transmission systems and precast businesses. Our strategy delivered record Q1 consolidated gross profit of $26.7 million, up 38% from last year, with our gross margin expanding 260 basis points year over year to 19.3%. That strength carried through to the bottom line, highlighting the operating leverage in our model and continued execution across the organization.

Speaker #1: Our performance was driven by a 14% favorable change in product mix, and increased sales volume reflecting continued growth in the non-residential portion of our business.

Speaker #2: Leading indicators remain solid early in 2026, with the Dodge Momentum Index up 26% in March of this year, versus March of 2025. The commercial sector was up 29%, and the institutional was up 20%.

Speaker #1: At Park Production increased 30% year over year, with strong growth in revenue per yard shipped. Despite borrowing costs that remain elevated as the Fed held interest rates steady in 2026.

Scott Montross: The commercial sector was up 29% and the institutional was up 20%, indicating positive signals for non-residential construction activity this year and into 2027. Our precast order book ended the quarter at $55 million, down modestly from the $57 million at year-end and below the $64 million level at 31 March of last year. The precast order book has remained stable for the last several quarters and continues to keep pace with higher levels of production and customer shipments. Stronger volumes and pricing contributed to a 30% year-over-year increase in precast gross profit to $9.3 million, resulting in a gross margin of 20.9%, up from 19.1% last year. These results show that absorption rates are improving with higher throughput. We expect margins to continue recovering as non-residential demand builds. Now turning to our strategic growth initiatives.

Speaker #2: Indicating positive signals for non-residential construction activity this year and into 2027. Our precast order book ended the quarter at $55 million, down modestly from the $57 million at year-end, and below the $64 million level at March 31st of last year.

Speaker #1: We are continuing to see signs of improvement in non-residential demand trajectory as we progress through 2026, specifically related to data set projects that have been instrumental in buoying the commercial construction demand.

Speaker #1: At Geneva, production and shipments had a solid year-over-year gain of 7% and 8%, respectively. Despite seeing a moderate slowdown in the residential construction market, this has more than been offset by growth in Geneva's non-residential business.

Speaker #2: The precast order book has remained stable for the last several quarters, and continues to keep pace with higher levels of production and customer shipments.

Scott Montross: We generated record Q1 profitability with earnings of $1.08 per share and produced strong free cash flow of $25.7 million or $2.62 per share, reinforcing the strength and consistency of our earnings profile and the resilience of our cash flows. Turning to our WTS segment. Revenue reached a Q1 record of $93.5 million, up 19% year over year with strong margin improvement. Our performance reflected higher production volume with tons produced up 18%, supported by strong project execution. This growth came despite adverse weather that caused unscheduled downtime across 3 WTS facilities early in Q1. Selling prices were up 1% year over year, driven by changes in product mix, we also benefited from favorable project timing across several large water transmission jobs.

Speaker #2: Stronger volumes and pricing contributed to a 30% year-over-year increase in precast gross profit to $9.3 million, resulting in a gross margin of 20.9%, up from 19.1% last year.

Speaker #1: Leading indicators remain solid early in 2026, with the Dodge Momentum Index up 26% in March of this year, versus March of 2025. The commercial sector was up 29% in the institutional was up 20%.

Speaker #2: These results show that absorption rates are improving with higher throughput. We expect margins to continue recovering as non-residential demand builds. Now turning to our strategic growth initiatives.

Speaker #1: Indicating positive signals for non-residential construction activity this year and into 2027. Our precast order book ended the quarter at $55 million, down modestly from the $57 million at year-end, and below the $64 million level at March 31st of last year.

Speaker #2: As previously discussed, we are making solid progress expanding precast capabilities across our network. We're also looking at where it makes sense to bring precast into additional WTS facilities through our product spread strategy, which remains an integral part of our long-term growth plan.

Scott Montross: As previously discussed, we are making solid progress expanding precast capabilities across our network. We're also looking at where it makes sense to bring precast into additional WTS facilities through our product spread strategy, which remains an integral part of our long-term growth plan. As part of that endeavor, we are seeing better capacity utilization at our precast plants, strong momentum at our Geneva operations in Utah, and steady progress as we introduce Park and other precast-related products into more WTS locations. At the same time, we continue to evaluate M&A opportunities in the precast-related space that can accelerate our strategy, expand our manufacturing capabilities and efficiencies, and broaden our geographic reach and product portfolio. Consistent with this approach, we are looking at both single plant acquisitions and larger opportunities that can support long-term growth and help us advance our precast expansion.

Speaker #1: The precast order book has remained stable for the last several quarters and continues to keep pace with higher levels of production and customer shipments.

Speaker #1: Stronger volumes and pricing contributed to a 30% year-over-year increase in precast gross profit to $9.3 million, resulting in gross margin of from 19.1% last year.

Speaker #2: As part of that endeavor, we are seeing better capacity utilization at our precast plants, strong momentum at our Geneva operations in Utah, and steady progress as we introduce Park and other precast-related products into more WTS locations.

Speaker #1: These results show that absorption rates are improving with higher throughput. We expect margins to continue recovering as non-residential demand builds. Now turning to our strategic growth initiatives.

Speaker #2: At the same time, we continue to evaluate M&A opportunities in the precast-related space that can accelerate our strategy, expand our manufacturing capabilities and efficiencies, and broaden our geographic reach and product portfolio.

Speaker #1: As previously discussed, we are making solid progress expanding precast capabilities across our network. We're also looking at where it makes sense to bring precast into additional WTS facilities through our product spread strategy, which remains an integral part of our long-term growth plan.

Speaker #2: Consistent with this approach, we are looking at both single-plant acquisitions and larger opportunities that can support long-term growth and help us advance our precast expansion as previously announced, we completed the acquisition of Bouton Precast, a single-site producer in the high-growth Pueblo, Colorado market during the first quarter of 2026.

Speaker #1: As part of that endeavor, we are seeing better capacity utilization at our precast plants, strong momentum at our Geneva operations in Utah, and steady progress as we introduce Park and other precast-related products into more WTS locations.

Scott Montross: As previously announced, we completed the acquisition of Boughton Precast, a single-site producer in the high-growth Pueblo, Colorado market during Q1 2026. The integration is off to a strong start, and we're encouraged by the long-term growth potential we see in the Colorado market. I'll now turn to our outlook for Q2 2026. In our Water Transmission Systems segment, we expect higher revenue and margins compared to both Q2 2025 and the prior quarter, driven by more favorable volume and product mix, and the emergence of a significant previously unplanned project. We entered 2026 with a robust WTS backlog and elevated bidding levels, and both strengthened further in Q1, providing even greater visibility into near-term demand.

Speaker #2: The integration is off to a strong start, and we're encouraged by the long-term growth potential we see in the Colorado market. I'll now turn to our outlook for the second quarter of 2026.

Speaker #1: At the same time, we continue to evaluate M&A opportunities in the precast-related space that can accelerate our strategy, expand our manufacturing capabilities and efficiencies, and broaden our geographic reach and product portfolio.

Scott Montross: WTS gross profit increased 42% year over year to $17.3 million, resulting in a gross margin of 18.5% up 300 basis points from last year. This improvement reflects higher volume supported by strong customer demand and the related efficiency gains in higher overhead absorption that come with that level of production, favorable product mix, and the overall solid operational execution across the segment. Now turning to our precast segment. Precast revenue increased 19% year over year to a new record Q1 level of $44.8 million. Our performance was driven by a 14% increase in selling prices from a favorable change in product mix and increased sales volume, reflecting continued growth in the non-residential portion of our business.

Speaker #2: In our water transmission systems segment, we expect higher revenue and margins compared to both the second quarter of 2025 and the prior quarter. Driven by more favorable volume and product mix, and the emergence of a significant previously unplanned project.

Speaker #1: Consistent with this approach, we are looking at both single-plant acquisitions and larger opportunities that can support long-term growth and help us advance our precast expansion as previously announced.

Speaker #1: We completed the acquisition of Belt & Precast, a single-site producer in the high-growth Pueblo, Colorado market, during the first quarter of 2026. The integration has offered a strong start, and we're encouraged by the long-term growth potential we see in the Colorado market.

Speaker #2: We entered 2026 with a robust WTS backlog and elevated bidding levels, in both strengthened further in the first quarter providing even greater visibility into near-term demand.

Speaker #2: Based on what we are seeing today, we expect full-year bidding levels to be stronger than what we saw in 2025, and we expect backlog to stay elevated throughout 2026.

Scott Montross: Based on what we are seeing today, we expect full year bidding levels to be stronger than what we saw in 2025. We expect backlog to stay elevated throughout 2026. We remain encouraged by the level of activity across current and upcoming water transmission projects, which continue to come with improved economics and margins. For a more complete view of these projects, please refer to our investor presentation on our website. Turning to precast, we maintained a stable and healthy order book in Q1 of 2026. We expect a stronger year for the precast business overall. Demand remains healthy in the non-residential market, supporting continued momentum across our Park and Geneva platforms.

Speaker #1: I'll now turn to our outlook for the second quarter of 2026. In our water transmission systems segment, we expect higher revenue and margins compared to both the second quarter of 2025 and the prior quarter.

Speaker #2: We remain encouraged by the level of activity across current and upcoming water transmission projects, which continue to come with improved economics and margins. For more complete view of these projects, please refer to our investor presentation on our website.

Speaker #1: Driven by more favorable volume and product mix, and the emergence of a significant previously unplanned project. We entered 2026 with a robust WTS backlog and elevated bidding levels, and both strengthened further in the first quarter, providing even greater visibility into near-term demand.

Scott Montross: At NWPX Park, production increased 30% year-over-year, with strong growth in revenue per yard shipped, despite borrowing costs that remain elevated as the U.S. Federal Reserve held interest rates steady in 2026. We are continuing to see signs of improvement in the nonresidential demand trajectory as we progress through 2026, specifically related to data center projects that have been instrumental in buoying the commercial construction demand. At NWPX Geneva, production and shipments had a solid year-over-year gains of 7% and 8% respectively. Despite seeing a moderate slowdown in the residential construction market, which has more than been offset by growth in NWPX Geneva's nonresidential business. Leading indicators remained solid early in 2026, with the Dodge Momentum Index up 26% in March of this year versus March of 2025.

Speaker #2: Turning to precast, we maintain a stable and healthy order book in the first quarter of 2026, and we expect a stronger year for the precast business overall.

Speaker #1: Based on what we are seeing today, we expect full-year bidding levels to be stronger than what we saw in 2025, and we expect backlogs to stay elevated throughout 2026.

Speaker #2: Demand remains healthy, and the non-residential market supporting continued momentum across our Park and Geneva platforms. For the second quarter, we expect precast revenue to be higher than the second quarter of last year and the prior quarter, with stable margins driven by solid demand, higher production levels with improved absorption and a strengthening order book.

Scott Montross: For Q2, we expect precast revenue to be higher than Q2 of last year and the prior quarter with stable margins driven by solid demand, higher production levels with improved absorption, and a strengthening order book. On a consolidated basis, we expect Q2 to be stronger than we've seen in recent years. We believe 2026 is shaping up to be a historic year for NWPX. Continued momentum in our precast business, combined with strong bidding activity in our WTS business, is indicating the potential for another record year. In addition, the significant previously unplanned WTS project noted earlier is additive to what we already expected for a record year. In closing, I'm very pleased with our results, which set new Q1 records across nearly every metric.

Speaker #1: We remain encouraged by the level of activity across current and upcoming water transmission projects, which continue to come with improved economics and margins. For more complete view of these projects, please refer to our investor presentation on our website.

Speaker #2: On a consolidated basis, we expect the second quarter to be stronger than we've seen in recent years. We believe 2026 is shaping up to be a historic year for NWPX.

Speaker #1: During the precast, we maintained a stable and healthy order book in the first quarter of 2026, and we expect a stronger year for the precast business overall.

Speaker #1: Demand remains healthy in the non-residential market, supporting continued momentum across our Park and Geneva platforms. For the second quarter, we expect precast revenue to be higher than the second quarter, of last year, and the prior quarter, with stable margins driven by solid demand, higher production levels with improved absorption, and a strengthening order book.

Speaker #2: Continued momentum in our precast business, combined with strong bidding activity in our WTS business, is indicating the potential for another record year. In addition, the significant previously unplanned WTS project noted earlier is additive to what we already expected for a record year.

Speaker #1: On a consolidated basis, we expect the second quarter to be stronger than we've seen in recent years. We believe 2026 is shaping up to be a historic year for NWPX.

Speaker #2: In closing, I'm very pleased with our results, which set new first-quarter records across nearly every metric. Our teams delivered exceptional execution throughout the quarter, and I want to thank everyone at NWPX for their commitment to our strategy and to maintaining a strong safety culture.

Scott Montross: Our teams delivered exceptional execution throughout the quarter, and I want to thank everyone at NWPX for their commitment to our strategy and to maintaining a strong safety culture. With a WTS backlog that is stronger than ever, a healthy bidding environment, and a solid momentum in our precast order book, we feel well-positioned to carry this performance forward and continue building on the progress we've made across both segments. As we look ahead, our near-term priorities remain. One, maintaining a safe and rewarding workplace. Two, focusing on margin over volume. Three, intensifying our pursuit of strategic acquisitions. Four, implementing cost efficiencies across the organization. Five, returning value to our shareholders when M&A opportunities are limited. I will now turn the call over to Aaron, who will walk through our financials in greater detail.

Speaker #1: Continued momentum in our precast business, combined with strong bidding activity in our WTS business, is indicating the potential for another record year. In addition, the significant previously unplanned WTS project noted earlier is additive to what we already expected for a record year.

Speaker #2: With the WTS backlog that is stronger than ever, a healthy bidding environment, and solid momentum in our precast order book, we feel well positioned to carry this performance forward and continue building on the progress we've made across both segments.

Speaker #1: In closing, I'm very pleased with our results, which set new first-quarter records across nearly every metric. Our team delivered exceptional execution throughout the quarter, and I want to thank everyone at NWPX for their commitment to our strategy and to maintaining a strong safety culture.

Speaker #2: As we look ahead, our near-term priorities remain: one, maintaining a safe and rewarding workplace; two, focusing on margin over volume; three, intensifying our pursuit of strategic acquisitions; four, implementing cost-efficiencies across the organization; and five, returning value to our shareholders when M&A opportunities are limited.

Speaker #1: With the WTS backlog and a stronger-than-ever healthy bidding environment and solid momentum in our precast order book, we feel well positioned to carry this performance forward and continue building on the progress we've made across both segments.

Scott Montross: As previously discussed, we are making solid progress expanding precast capabilities across our network. We're also looking at where it makes sense to bring precast into additional WTS facilities through our Product Spread Strategy, which remains an integral part of our long-term growth plan. As part of that endeavor, we are seeing better capacity utilization at our precast plants, strong momentum at our Geneva operations in Utah, and steady progress as we introduce Park and other precast-related products into more WTS locations. At the same time, we continue to evaluate M&A opportunities in the precast-related space that can accelerate our strategy, expand our manufacturing capabilities and efficiencies, and broaden our geographic reach and product portfolio. Consistent with this approach, we are looking at both single plant acquisitions and larger opportunities that can support long-term growth and help us advance our precast expansion.

Speaker #2: I will now turn the call over to Aaron, who will walk through our financials in greater detail. Thank you, Scott, and good morning to everyone joining the call today.

Speaker #1: As we look ahead, our near-term priorities remain: one, maintaining a safe and rewarding workplace; two, focusing on margin over volume; three, intensifying our pursuit of strategic acquisitions; four, implementing cost-efficiencies across the organization; and five, returning value to our shareholders when M&A opportunities are limited.

Aaron Wilkins: Thank you, Scott, and good morning to everyone joining the call today. Before I begin, I'd like to mention that unless otherwise stated, all financial measures in my remarks refer to Q1 2026, and all comparisons will be year-over-year comparisons versus Q1 2025. I'll begin with our profitability. We delivered record Q1 consolidated net income of $10.5 million, or $1.08 per diluted share, up from $4 million or $0.39 per diluted share, reflecting the improving operating leverage on higher revenues and the continued strength and execution across the business. On the top line, consolidated net sales grew 19.1% to $138.3 million, compared to $116.1 million last year.

Speaker #2: Before I begin, I'd like to mention that unless otherwise stated, all financial measures in my remarks refer to the first quarter of 2026 and all comparisons will be year-over-year comparisons versus the first quarter of 2025.

Speaker #2: I'll begin with our profitability. We delivered record first-quarter consolidated net $1.08 per diluted share, up from $4 million or $0.39 per diluted share, reflecting the improving operating leverage on higher revenues and the continued strength in execution across the business.

Speaker #1: I will now turn the call over to Aaron, who will walk through our financials in greater detail.

Speaker #2: Thank you, Scott, and good morning to everyone joining the call today. Before I begin, I'd like to mention that unless otherwise stated, all financial measures and my remarks refer to the first quarter of 2026, and all comparisons will be year-over-year comparisons versus the first quarter of 2025.

Speaker #2: On the top line, consolidated net sales grew 19.1% to $138.3 million compared to $116.1 million last year. Our water transmission systems segment also posted a record first quarter, with sales rising 19.1% to $93.5 million versus $78.4 million.

Speaker #2: I'll begin with our profitability. We delivered record first-quarter consolidated net income of $10.5 million, or $1.08 per diluted share, up from $4 million, or $0.39 per diluted share, reflecting the improving operating leverage and higher revenues, and the continued strength in execution across the business.

Scott Montross: As previously announced, we completed the acquisition of Boughton's Precast, a single-site producer in the high-growth Pueblo, Colorado market during Q1 2026. The integration is off to a strong start, and we're encouraged by the long-term growth potential we see in the Colorado market. I'll now turn to our outlook for Q2 2026. In our water transmission system segment, we expect higher revenue and margins compared to both Q2 2025 and the prior quarter, driven by more favorable volume and product mix and the emergence of a significant previously unplanned project. We entered 2026 with a robust WTS backlog and elevated bidding levels, and both strengthened further in Q1, providing even greater visibility into near-term demand.

Aaron Wilkins: Our Water Transmission Systems segment also posted a record first quarter, with sales rising 19.1% to $93.5 million versus $78.4 million. This growth was driven by an 18% increase in tons produced due largely to project timing and a 1% improvement in the selling price per ton due to product mix. Precast delivered a record first quarter as well, with sales up 18.9% to $44.8 million compared to $37.7 million. The results benefited from a 14% increase in selling prices due to product mix and a 4% increase in volume shipped.

Speaker #2: This growth was driven by an 18% increase in tons produced due largely to project timing and a 1% improvement in selling price per ton, due to product mix.

Speaker #2: On top line consolidated net sales grew 19.1% to $138.3 million, compared to $116.1 million last year. Our water transmission system segment also posted a record first quarter, with sales rising 19.1% to $93.5 million, versus 78.4 million.

Speaker #2: Precast delivered a record first quarter as well. With sales up 18.9% to $44.8 million compared to $37.7 million. The results benefited from a 14% increase in selling prices due to product mix, and a 4% increase in volume shipped.

Speaker #2: This growth was driven by an 18% increase in tons produced, due largely to project timing, and a 1% improvement in selling price per ton, due to product mix.

Speaker #2: As a reminder, the products we manufacture are unique and the average sales prices for both of our operating segments as well as the precast shipment volumes and WTS production volumes cannot always be relied upon as comparable metrics due to variations in the mix between periods.

Aaron Wilkins: As a reminder, the products we manufacture are unique, and the average sales prices for both of our operating segments, as well as the Precast shipment volumes and WTS production volumes cannot always be relied upon as comparable metrics due to variations in the mix between periods. We also achieved record Q1 consolidated gross profit, supported by higher volume and favorable pricing and mix. Gross profit was $26.7 million, up 37.7%, representing 19.3% of sales, a 260 basis point improvement from $19.4 million, or 16.7% of sales. In Water Transmission Systems, gross profit increased 42.3% to $17.3 million or 18.5% of segment sales, a 300 basis point improvement from $12.2 million or 15.5% of sales.

Speaker #2: Precast delivered record first quarter as well. With sales up 18.9% to $44.8 million, compared to 37.7 million. The results benefited from a 14% increase in selling prices due to product mix and a 4% increase in volume shift.

Scott Montross: Based on what we are seeing today, we expect full-year bidding levels to be stronger than what we saw in 2025. We expect backlog to stay elevated throughout 2026. We remain encouraged by the level of activity across current and upcoming water transmission projects, which continue to come with improved economics and margins. For a more complete view of these projects, please refer to our investor presentation on our website. Turning to precast, we maintained a stable and healthy order book in Q1 2026. We expect a stronger year for the precast business overall. Demand remains healthy in the non-residential market, supporting continued momentum across our NWPX Park and NWPX Geneva platforms.

Speaker #2: We also achieved record first quarter consolidated gross profit supported by higher volume and favorable pricing and mix. Gross profit was $26.7 million up $37.7%, representing 19.3% of sales; a $260 basis point improvement from $19.4 million or $16.7% of sales.

Speaker #2: As a reminder, the products we manufacture are unique, and the average sales prices for both of our operating segments, as well as the precast shipment volumes and WTS production volumes, cannot always be relied upon as comparable metrics due to variations in the mix between periods.

Speaker #2: We also achieved record first-quarter consolidated gross profit supported by higher volume and favorable pricing and mix. Gross profit was 26.7 million, up 37.7%, representing 19.3% of sales, a 260 basis point improvement from 19.4 million, or 16.7% of sales.

Speaker #2: In water transmission systems gross profit increased $42.3% to $17.3 million or $18.5% of segment sales, a $300 basis point improvement from $12.2 million or $15.5% of sales.

Speaker #2: The increase reflects higher production volume and the associated operational efficiency gains as well as favorable changes in product mix. Precast gross profit also reached a record first quarter, rising 30% to $9.3 million or $20.9% of segment sales, compared to $7.2 million or $19.1% of sales.

Aaron Wilkins: The increase reflects higher production volume and the associated operational efficiency gains as well as favorable changes in product mix. Precast gross profit also reached a record first quarter, rising 30% to $9.3 million or 20.9% of segment sales, compared to $7.2 million or 19.1% of sales. The 180 basis point improvement in gross margin was largely driven by higher selling prices tied to product mix. Selling, general, and administrative expenses were $14 million, up 1.5% and representing 10.1% of net sales. A 180 basis point improvement from 11.9% of net sales a year ago, even with modest increases in incentive compensation expense. For the full year of 2026, we now expect consolidated SG&A to range between $53 million and $55 million.

Speaker #2: In water transmission systems, gross profit increased 42.3% to 17.3 million, or 18.5% of segment sales, a 300 basis point improvement from 12.2 million, or 15.5% of sales.

Speaker #2: The increase reflects higher production volume and the associated operational efficiency gains, as well as favorable changes in product mix. Precast gross profit also reached a record first quarter, rising 30% to $9.3 million, or 20.9% of segment sales, compared to $7.2 million, or 19.1% of sales.

Speaker #2: The $180 basis point improvement in gross margin was largely driven by higher selling prices tied to product mix. Selling general and administrative expenses were $14 million up $1.5% and represented $10.1% of net sales.

Speaker #2: The 180 basis point improvement in gross margin was largely driven by higher selling prices tied to product mix. Selling general and administrative expenses were 14 million, up 1.5%, and represented 10.1% of net sales.

Speaker #2: A $180 basis point improvement from $11.9% of net sales a year ago even with modest increases in incentive compensation expense. For the full year 2026, we now expect consolidated SG&A to range between $53 and $55 million.

Speaker #2: 180 basis point improvement from 11.9% of net sales a year ago, even with modest increases in incentive compensation expense. For the full year 2026, we now expect consolidated SG&A to range between 53 and 55 million.

Speaker #2: Depreciation and amortization expense was $4.8 million compared to $4.4 million and we continue to expect a full year expense of approximately $20 to $22 million.

Aaron Wilkins: Depreciation and amortization expense was $4.8 million compared to $4.4 million, and we continue to expect a full year expense of approximately $20 to 22 million. Interest expense declined to $0.3 million from $0.6 million, reflecting lower average daily borrowings. Income tax expense was $2 million, resulting in an effective income tax rate of 16%, compared to $1 million or a rate of 19.8% last year. The effective rates for both quarters were primarily impacted by tax windfalls recognized upon the vesting of equity awards. Our tax rate can vary based on the level of total permanent differences relative to pre-tax income. For the full year, we currently expect an effective tax rate of approximately 24% to 26%. I'll now turn to our financial condition.

Scott Montross: Our teams delivered exceptional execution throughout the quarter, and I want to thank everyone at NWPX for their commitment to our strategy and to maintaining a strong safety culture. With a WTS backlog that is stronger than ever, a healthy bidding environment, and a solid momentum in our precast order book, we feel well positioned to carry this performance forward and continue building on the progress we've made across both segments. As we look ahead, our near-term priorities remain. One, maintaining a safe and rewarding workplace. Two, focusing on margin over volume. Three, intensifying our pursuit of strategic acquisitions. Four, implementing cost efficiencies across the organization. Five, returning value to our shareholders when M&A opportunities are limited. I will now turn the call over to Aaron, who will walk through our financials in greater detail.

Speaker #2: Interest expense declined to $0.3 million from $0.6 million reflecting lower average daily borrowings. Income tax expense was $2 million resulting in an effective income tax rate of 16% compared to $1 million or a rate of 19.8% last year.

Speaker #2: Depreciation and amortization expense was 4.8 million, compared to 4.4 million, and we continued to expect a full year expense of approximately 20 to 22 million.

Speaker #2: Interest expense declined to 0.3 million from 0.6 million, reflecting lower average daily borrowings. Income tax expense was 2 million, resulting in an effective income tax rate of 16%, compared to 1 million, or a rate of 19.8% last year.

Speaker #2: The effective rates for both quarters were primarily impacted by tax windfalls recognized upon the vesting of equity awards. Our tax rate can vary based on the level of total permanent differences relative to pre-tax income.

Speaker #2: The effective rates for both quarters were primarily impacted by tax windfalls recognized upon the investing of equity awards. Our tax rate can vary based on the level of total permanent differences relative to pre-tax income, and for the full year, we currently expect an effective tax rate of approximately 24 to 26%.

Speaker #2: For the full year, we currently expect an effective tax rate of approximately 24 to 26 percent. I'll now turn to our financial condition. At March 31st, 2026, cash and cash equivalents improved to 14.3 million from 2.3 million at year-end.

Aaron Wilkins: At 31 March 2026, cash and cash equivalents improved to $14.3 million from $2.3 million at year-end. Our debt balance totaled $10.7 million, and there were no outstanding borrowings on our credit facility at 31 March 2026. This resulted in a net cash position of $3.5 million as we continue to drive cash to the balance sheet to support our growth and shareholder return priorities. Our improved profitability, coupled with favorable changes in working capital, drove strong net cash provided by operating activities of $29.2 million, reflecting a more than 500% increase from $4.8 million last year. Capital expenditures were $3.5 million compared to $3.7 million last year.

Speaker #2: I'll now turn to our financial condition. At March 31st, 2026, cash and cash equivalents improved to 14.3 million, from 2.3 million at year-end. Our debt balance totaled 10.7 million, and there were no outstanding borrowings on our credit facility at March 31st.

Speaker #2: Our debt balance totaled $10.7 million and there were no outstanding borrowings on our credit facility at March 31st. This resulted in a net cash position of $3.5 million as we continue to drive cash to the balance sheet to support our growth and shareholder return priorities.

Aaron: Thank you, Scott. Good morning to everyone joining the call today. Before I begin, I'd like to mention that unless otherwise stated, all financial measures in my remarks refer to Q1 2026, and all comparisons will be year-over-year comparisons versus Q1 2025. I'll begin with our profitability. We delivered record Q1 consolidated net income of $10.5 million, or $1.08 per diluted share, up from $4 million or $0.39 per diluted share, reflecting the improving operating leverage on higher revenues and the continued strength and execution across the business. On the top line, consolidated net sales grew 19.1% to $138.3 million compared to $116.1 million last year.

Aaron Wilkins: Thank you, Scott. Good morning to everyone joining the call today. Before I begin, I'd like to mention that unless otherwise stated, all financial measures in my remarks refer to Q1 2026, and all comparisons will be year-over-year comparisons versus Q1 2025. I'll begin with our profitability. We delivered record Q1 consolidated net income of $10.5 million, or $1.08 per diluted share, up from $4 million or $0.39 per diluted share, reflecting the improving operating leverage on higher revenues and the continued strength and execution across the business. On the top line, consolidated net sales grew 19.1% to $138.3 million compared to $116.1 million last year.

Speaker #2: This resulted in a net cash position of 3.5 million, as we continue to drive cash to the balance sheet to support our growth and shareholder return priorities.

Speaker #2: Our improved changes in working capital drove strong net cash provided by operating activities of $29.2 million, reflecting a more than 500% increase from $4.8 million last year.

Speaker #2: Our improved profitability coupled with favorable changes in working capital drove strong net cash provided by operating activities of 29.2 million, reflecting a more than 500% increase from 4.8 million last year.

Speaker #2: Capital expenditures were $3.5 million compared to $3.7 million last year. For the full year 2026, we continue to expect CapEx in the $20 to $24 million range including approximately $6 million for investment projects to support our precast product spread strategy and broader precast growth initiatives.

Aaron Wilkins: For the full year 2026, we continue to expect CapEx in the $20 to $24 million range, including approximately $6 million for investment projects to support our Precast product spread strategy and broader Precast growth initiatives. As a result, we generated $25.7 million of free cash flow in the quarter compared to $1.2 million last year. For 2026, we are raising our full-year free cash flow outlook to $50 to $56 million, up from a prior range of $40 to $46 million. In terms of capital deployment for the quarter, we spent $8.9 million to complete the purchase of Boughton Precast, repurchased approximately 33,000 shares of our common stock at an average price of $67.17 for a total of $2.2 million, and repaid $1 million in debt.

Speaker #2: Capital expenditures were 3.5 million, compared to 3.7 million last year. For the full year 2026, we continue to expect CapEx in the 20 to 24 million range, including approximately 6 million for investment projects to support our pre-cap product spread strategy and broader pre-cap growth initiatives.

Speaker #2: As a result, we generated $25.7 million of free cash flow in the quarter compared to $1.2 million last year. For 2026, we are raising our full year free cash flow outlook to $50 to $56 million up from a prior range of $40 to $46 million.

Speaker #2: As a result, we generated 25.7 million in free cash flow in the quarter, compared to 1.2 million last year. For 2026, we are raising our full year free cash flow outlook to 50 to 56 million, up from a prior range of 40 to 46 million.

Aaron: Our water transmission systems segment also posted a record first quarter, with sales rising 19.1% to $93.5 million versus $78.4 million. This growth was driven by an 18% increase in tons produced due largely to project timing and a 1% improvement in the selling price per ton due to product mix. precast delivered a record first quarter as well, with sales up 18.9% to $44.8 million, compared to $37.7 million. The results benefited from a 14% increase in selling prices due to product mix and a 4% increase in volume shipped.

Aaron Wilkins: Our water transmission systems segment also posted a record first quarter, with sales rising 19.1% to $93.5 million versus $78.4 million. This growth was driven by an 18% increase in tons produced due largely to project timing and a 1% improvement in the selling price per ton due to product mix. precast delivered a record first quarter as well, with sales up 18.9% to $44.8 million, compared to $37.7 million. The results benefited from a 14% increase in selling prices due to product mix and a 4% increase in volume shipped.

Speaker #2: In terms of capital deployment for the quarter, we spent $8.9 million to complete the purchase of Bouton Precast, repurchased approximately $33,000 shares of our common stock at an average price of $67.17, for a total of $2.2 million.

Speaker #2: In terms of capital deployment for the quarter, we spent 8.9 million to complete the purchase of Bouton pre-cast, repurchased approximately 33,000 shares of our common stock, and averaged price of $67.17, for a total of 2.2 million.

Speaker #2: And repaid $1 million in debt. These activities highlight our ability to continue to grow the company while concurrently returning value to our shareholders. To close, we delivered a strong start to the year.

Speaker #2: And repayed $1 million in debt. These activities highlight our ability to continue to grow the company while concurrently returning value to our shareholders. To close, we delivered a strong start to the year, with the first quarter records for revenue under the current configuration, gross profit, and earnings.

Aaron Wilkins: These activities highlight our ability to continue to grow the company while concurrently returning value to our shareholders. To close, we delivered a strong start to the year with Q1 records for revenue under the current configuration, gross profit, and earnings. We also generated very strong free cash flow, further strengthened our balance sheet, and remained disciplined in our capital deployment. Our record Water Transmission Systems backlog and our solid precast order book, coupled with the commercial team's focus on pricing and our track record of superb operational execution, position us to achieve new heights in financial performance as we move through the remainder of 2026. Thank you to our employees for the continued concentration on workplace safety and to our shareholders for their continued support. I'll now turn it over to the operator to begin the question and answer session.

Aaron: As a reminder, the products we manufacture are unique, and the average sales prices for both of our operating segments, as well as the precast shipment volumes and WTS production volumes cannot always be relied upon as comparable metrics due to variations in the mix between periods. We also achieved record Q1 consolidated gross profit, supported by higher volume and favorable pricing and mix. Gross profit was $26.7 million, up 37.7%, representing 19.3% of sales, a 260 basis point improvement from $19.4 million, or 16.7% of sales. In water transmission systems, gross profit increased 42.3% to $17.3 million, or 18.5% of segment sales, a 300 basis point improvement from $12.2 million or 15.5% of sales.

Aaron Wilkins: As a reminder, the products we manufacture are unique, and the average sales prices for both of our operating segments, as well as the precast shipment volumes and WTS production volumes cannot always be relied upon as comparable metrics due to variations in the mix between periods. We also achieved record Q1 consolidated gross profit, supported by higher volume and favorable pricing and mix. Gross profit was $26.7 million, up 37.7%, representing 19.3% of sales, a 260 basis point improvement from $19.4 million, or 16.7% of sales. In water transmission systems, gross profit increased 42.3% to $17.3 million, or 18.5% of segment sales, a 300 basis point improvement from $12.2 million or 15.5% of sales.

Speaker #2: With first quarter records for revenue under the current configuration, gross profit, and earnings. We also generated very strong free cash flow further strengthened our balance sheet and remained disciplined in our capital deployment.

Speaker #2: We also generated very strong free cash flow, further strengthening our balance sheet and remained disciplined in our capital deployment. Our record water transmission systems backlog and our solid pre-cast order book coupled with the commercial team's focus on pricing and our track record of superb operational execution position us to achieve new heights in financial performance as we move through the remainder of 2026.

Speaker #2: Our record water transmission systems backlog and our solid precast order book coupled with the commercial team's focus on pricing and our track record of superb operational execution position us to achieve new heights in financial performance as we move through the remainder of 2026.

Speaker #2: Thank you to our employees for their continued concentration on workplace safety and to our shareholders for their continued support. I'll now turn it over to the operator to begin the question-and-answer session.

Speaker #1: Thank you. We will now be conducting a question-and-answer session. If you would like to ask a question, please press star 1 on your telephone keypad.

Speaker #1: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad.

Operator: Thank you. We will now be conducting a question and answer session. If you would like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys. Our first question today, we'll hear from Julio Romero with Sidoti & Company.

Speaker #1: A confirmation tone will indicate your line is in the question queue. You may press star 2 to remove yourself from the queue. For participants using speaker equipment, it may be necessary to pick up a handset before pressing the star keys.

Speaker #1: A confirmation tone will indicate your line is in the question queue. You yourself from the queue. For participants using speaker equipment, it may be necessary to pick up the handset before pressing the star keys.

Aaron: The increase reflects higher production volume and the associated operational efficiency gains, as well as favorable changes in product mix. precast gross profit also reached a record Q1, rising 30% to $9.3 million, or 20.9% of segment sales, compared to $7.2 million, or 19.1% of sales. The 180 basis point improvement in gross margin was largely driven by higher selling prices tied to product mix. Selling, general and administrative expenses were $14 million, up 1.5% and representing 10.1% of net sales. A 180 basis point improvement from 11.9% of net sales a year ago, even with modest increases in incentive compensation expense. For the full year 2026, we now expect consolidated SG&A to range between $53 million and $55 million.

Aaron Wilkins: The increase reflects higher production volume and the associated operational efficiency gains, as well as favorable changes in product mix. precast gross profit also reached a record Q1, rising 30% to $9.3 million, or 20.9% of segment sales, compared to $7.2 million, or 19.1% of sales. The 180 basis point improvement in gross margin was largely driven by higher selling prices tied to product mix. Selling, general and administrative expenses were $14 million, up 1.5% and representing 10.1% of net sales. A 180 basis point improvement from 11.9% of net sales a year ago, even with modest increases in incentive compensation expense. For the full year 2026, we now expect consolidated SG&A to range between $53 million and $55 million.

Speaker #1: And our first question today we'll hear from Julio Romero with Sedai & Company.

Speaker #1: And our first question today we'll hear from Julio Company.

Speaker #3: Thanks. Hey, good morning, Scott and Aaron.

Speaker #4: Good morning, good morning, Julio.

Speaker #3: Hey, I—hey, good morning. Hey, Scott, I appreciate the significantly—significant previously unplanned projects under NDA, so, you know, to the extent that you can, could you maybe help us understand, you know, at a high level, you know, how additive the project is to your 2026 outlook, whether it goes beyond 2026, you know, potentially to 2027, and then secondly, should we think of this as—as kind of a one-off, or—or does it have the potential to lead to additional phases or—or repeat business with that customer?

Speaker #3: Thanks. Hey, good morning, Scott and Aaron.

Julio Romero: Thanks. Hey, good morning, Scott and Aaron.

Speaker #4: Good morning, good morning, Julio.

Scott Montross: Good morning, Julio.

Speaker #3: Hey, good morning. Scott, I appreciate the significantly previously unplanned project is under NDA, so to the extent that you can, could you maybe help us understand at a high level how additive the project is to your '26 outlook?

Aaron Wilkins: Good morning.

Julio Romero: Hey, good morning. Hey, Scott Montross, I appreciate the significant previously unplanned project is under NDA. You know, to the extent that you can, could you maybe help us understand, you know, at a high level, you know, how additive the project is to your 2026 outlook, whether it goes beyond 2026, you know, potentially into 2027? Secondly, should we think of this as kind of a one-off or does it have the potential to lead to additional phases or repeat business with that customer?

Speaker #3: Whether it goes beyond '26, potentially into '27, and then secondly, should we think of this as kind of a one-off or does it have the potential to lead to additional phases or repeat business with that customer?

Speaker #4: So, so yeah, and like you said, we're under NDA. It's a government-related project. it's being produced at multiple of our plans. What I would tell you is it looks like this piece of the project, because there are—uh, from what we understand, multiple other pieces of this project as we go forward, in the future, is—is right in the area of about 50 million.

Aaron: Depreciation and amortization expense was $4.8 million, compared to $4.4 million, and we continue to expect a full year expense of approximately $20 million to $22 million. Interest expense declined to $0.3 million from $0.6 million, reflecting lower average daily borrowings. Income tax expense was $2 million, resulting in an effective income tax rate of 16%, compared to $1 million or a rate of 19.8% last year. The effective rates for both quarters were primarily impacted by tax windfalls recognized upon the vesting of equity awards. For the full year, we currently expect an effective tax rate of approximately 24% to 26%. I'll now turn to our financial condition.

Aaron Wilkins: Depreciation and amortization expense was $4.8 million, compared to $4.4 million, and we continue to expect a full year expense of approximately $20 million to $22 million. Interest expense declined to $0.3 million from $0.6 million, reflecting lower average daily borrowings. Income tax expense was $2 million, resulting in an effective income tax rate of 16%, compared to $1 million or a rate of 19.8% last year. The effective rates for both quarters were primarily impacted by tax windfalls recognized upon the vesting of equity awards. For the full year, we currently expect an effective tax rate of approximately 24% to 26%. I'll now turn to our financial condition.

Speaker #4: Yeah. So yeah, and like you said, we're under NDA. It's a government-related project. It's being produced at multiple of our plants. What I would tell you is it looks like this piece of the project because there are from what we understand, multiple other pieces of this project as we go forward into the future is right in the area of about $50 million.

Scott Montross: Yeah. So yeah, and like you said, we're under NDA. It's a government-related project. It's being produced at multiple of our plants. What I would tell you is it looks like this piece of the project, because there are, from what we understand, multiple other pieces of this project as we go forward, into the future is right in the area of about $50 million. Okay. The, you know, the real question is it's a, it's a relatively short-fused job that is scheduled to be produced really in the late Q2, Q3, going into about the mid Q4 of this year. That segment is expected to be done.

Speaker #4: Okay? So—so the—the, you know, the real question is—is, it's—it's a—it's a—it's a relatively short-fused job that—that is—that is scheduled to be produced really in the late second quarter, third quarter, going into about the mid-fourth quarter.

Speaker #4: Okay? So the real question is it's a relatively short-fused job that is scheduled to be produced really in the late second quarter, third quarter going into about the mid-fourth quarter of this year.

Speaker #4: this year, in that segment, it is—is expected to be done. I think one of the challenging things is right now is there's a little bit more of a question on—on how quickly you can get all the steel to do it.

Speaker #4: So there is potential that some of it could leak in next year. But the understanding we have of these projects is—is there's multiple phases of these things that are planned right now that go out into the future that could be additive to other years as we go into the future.

Speaker #4: In that segment, it is expected to be done. I think one of the challenging things is right now is there's a little bit more of a question on how quickly you can get all the steel to do it.

Scott Montross: I think one of the challenging things right now is there's a little bit more of a question on how quickly you can get all the steel to do it. There is a potential that some of it could leak into next year. The understanding we have of these projects is there's multiple phases of these things that are planned right now that go out into the future that could be additive to other years as we go into the future. I think that's probably as clean of a look as I can give you, Julio, on the thing.

Aaron: At 31 March 2026, cash and cash equivalents improved to $14.3 million from $2.3 million at year-end. Our debt balance totaled $10.7 million, and there were no outstanding borrowings on our credit facility at 31 March. This resulted in a net cash position of $3.5 million as we continue to drive cash to the balance sheet to support our growth and shareholder return priorities. Our improved profitability, coupled with favorable changes in working capital, drove strong net cash provided by operating activities of $29.2 million, reflecting a more than 500% increase from $4.8 million last year. Capital expenditures were $3.5 million, compared to $3.7 million last year.

Aaron Wilkins: At 31 March 2026, cash and cash equivalents improved to $14.3 million from $2.3 million at year-end. Our debt balance totaled $10.7 million, and there were no outstanding borrowings on our credit facility at 31 March. This resulted in a net cash position of $3.5 million as we continue to drive cash to the balance sheet to support our growth and shareholder return priorities. Our improved profitability, coupled with favorable changes in working capital, drove strong net cash provided by operating activities of $29.2 million, reflecting a more than 500% increase from $4.8 million last year. Capital expenditures were $3.5 million, compared to $3.7 million last year.

Speaker #4: So there is a potential that some of it could leak into next year. But the understanding we have of these projects is there's multiple phases of these things that are planned right now that go out into the future that could be additive to other years as we go into the future.

Speaker #4: And I think that's probably as clean of a look as I could give—give Julio on the thing.

Speaker #3: Absolutely. I really appreciate the call you gave with that answer. I think you kind of hit the points I was looking for. there. you know, on—on your cash flow in the quarter, it was very strong.

Speaker #4: And I think that's probably as clean of a look as I can give you, Julio, on the thing.

Speaker #3: and it looks like your—your net contract asset position improved pretty meaningfully. driven by contract liabilities, it—can you give us any more color on what drove that increase and is it tied to that, that one-off that project, or—or any other larger WTS projects?

Speaker #3: Absolutely. I really appreciate the color you gave with that answer. I think you kind of hit the points I was looking for. There. On your cash flow in the quarter, it was very strong.

Julio Romero: Absolutely. I really appreciate the color you gave with that answer. I think you kind of hit the points I was looking for there. You know, on your cash flow in the quarter, it was very strong. It looks like your net contract asset position improved pretty meaningfully, driven by contract liabilities. Can you give us any more color on what drove that increase, and is it tied to that one-off project or any other larger WTS projects?

Speaker #3: And it looks like your net contract asset position improved pretty meaningfully. Driven by contract liabilities, can you give us any more color on what drove that increase and is it tied to that project or any other larger WCS projects?

Speaker #4: Yeah. I—I really—yeah. The—the cash flows for the business, obviously, can be a little bit challenging to—to forecast because again, at times, it can be a little bumpy.

Aaron: For the full year 2026, we continue to expect CapEx in the $20 to 24 million range, including approximately $6 million for investment projects to support our precast Product Spread Strategy and broader precast growth initiatives. As a result, we generated $25.7 million of free cash flow in the quarter, compared to $1.2 million last year. For 2026, we are raising our full-year free cash flow outlook to $50 to 56 million, up from a prior range of $40 to 46 million. In terms of capital deployment for the quarter, we spent $8.9 million to complete the purchase of Boughton's Precast, repurchased approximately 33,000 shares of our common stock at an average price of $67.17, for a total of $2.2 million, and repaid $1 million in debt.

Aaron Wilkins: For the full year 2026, we continue to expect CapEx in the $20 to 24 million range, including approximately $6 million for investment projects to support our precast Product Spread Strategy and broader precast growth initiatives. As a result, we generated $25.7 million of free cash flow in the quarter, compared to $1.2 million last year. For 2026, we are raising our full-year free cash flow outlook to $50 to 56 million, up from a prior range of $40 to 46 million. In terms of capital deployment for the quarter, we spent $8.9 million to complete the purchase of Boughton's Precast, repurchased approximately 33,000 shares of our common stock at an average price of $67.17, for a total of $2.2 million, and repaid $1 million in debt.

Speaker #4: which is normal, but in, you know, really—really what happened, and what continues to be a focus for our—our—our water transmission systems, commercial teams, is to drive—uh, what I call special trying to get, the steel, billed in advance of the project, get MOH payments and—and—and progress payments, throughout the job.

Speaker #4: Yeah. Hi, Julio. Yeah. The cash flows for the business obviously can be a little bit challenging to forecast because they can at times be a little lumpy.

Aaron Wilkins: Hi, Julio. The cash flows for the business obviously can be a little bit challenging to forecast because they can at times be a little lumpy, which is normal. In, you know, what happened and what continues to be a focus for our Water Transmission Systems commercial teams is to drive what I call trying to get the steel, the build in advance of the project, get MOH payments and progress payments throughout the job. That is something that over the span of the last three years, we are seeing growing success at. It is still negotiated individually with the specific customers, but we're able to do that more often than we used to be able to do it.

Speaker #4: Which is normal, but really what happened and what continues to be a focus for our water transmission system. Commercial teams is to drive what I call special.

Speaker #4: That is something that over the span of the last three years, we are—we are seeing growing success at. it is still, negotiated, individually with the specific customers, but we're able to do that more—more often, more often than we—we used to be able to do it.

Speaker #4: Trying to get the steel billed in advance of the project, get MOH payments and progress payments throughout the job. That is something that over the span of the last three years, we are seeing growing success at.

Speaker #4: And—and really, what happened was we had a $20 million collection on one of those special billings come in in the month, I think it was the month of February or March.

Speaker #4: It is still negotiated individually with the specific customers, but we're able to do that more offten than we used to be able to do it.

Aaron: These activities highlight our ability to continue to grow the company while concurrently returning value to our shareholders. To close, we delivered a strong start to the year, with Q1 records for revenue under the current configuration, gross profit, and earnings. We also generated very strong free cash flow, further strengthened our balance sheet, and remained disciplined in our capital deployment. Our record water transmission systems backlog and our solid precast order book, coupled with the commercial team's focus on pricing and our track record of superb operational execution, position us to achieve new heights in financial performance as we move through the remainder of 2026. Thank you to our employees for the continued concentration on workplace safety and to our shareholders for their continued support. I'll now turn it over to the operator to begin the question and answer session.

Aaron Wilkins: These activities highlight our ability to continue to grow the company while concurrently returning value to our shareholders. To close, we delivered a strong start to the year, with Q1 records for revenue under the current configuration, gross profit, and earnings. We also generated very strong free cash flow, further strengthened our balance sheet, and remained disciplined in our capital deployment. Our record water transmission systems backlog and our solid precast order book, coupled with the commercial team's focus on pricing and our track record of superb operational execution, position us to achieve new heights in financial performance as we move through the remainder of 2026. Thank you to our employees for the continued concentration on workplace safety and to our shareholders for their continued support. I'll now turn it over to the operator to begin the question and answer session.

Speaker #4: you'll notice that our accounts receivable remains elevated, which means that we're still doing a great job of billing customers. That is because we have also, on a completely separate job, billed another customer for $20 million—a little over $20 million—uh, and that has since been received.

Speaker #4: And really, what happened was we had a $20 million collection on one of those special billings come in in the month, I think it was the month of February, or March.

Aaron Wilkins: Really, what happened was we had a $20 million collection on one of those special billings come in in the month, I think it was the month of February or March. You'll notice that our accounts receivable remains elevated, which means that we're still doing a great job of billing customers. That is because we have, also on a completely separate job, billed another customer for $20 million, a little over $20 million, and that has since been received. The business model really has been driven to get the cash flows as a focus. You know, that's why, you know, in part at least, I had to raise our range, our guidance for free cash for 2026.

Speaker #4: So the—the—the—the—the business model really is—is driven to get the—the cash flows, at—at—at a focus and, you know, that's why, you know, in part, at least, I had to raise our—our range, our guidance for free cash for—for 2026.

Speaker #4: You'll notice that our accounts receivable remains elevated, which means that we're still doing a great job of billing customers. That is because we have also on a completely separate job billed another customer for $20 million a little over $20 million and that has since been received.

Speaker #4: I think we're going to be more successful. There's more opportunities, for the—for the WTS team to—to—to do these special billings in—in the year, compared to 2025 year, which was also a very successful year, by the way.

Speaker #4: So the business model really has been driven to get the cash flows as a focus and that's why in part, at least, I had to raise our range, our guidance for free cash for 2026.

Speaker #4: and I think that, this—the—the new—the new job that Scott just talked to you about, those two elements, were—were worthwhile for—for raising the—the range so quickly into the year.

Operator: Thank you. We will now be conducting a question and answer session. Our first question today, we'll hear from Julio Romero with Sidoti & Company.

Speaker #4: I think we're going to be more successful. I think there's more opportunities for the WTS team to do these special billings in the year compared to 2025 year, which was also a very successful year, by the way.

Aaron Wilkins: I think we're going to be more successful. I think there's more opportunities for the WTS team to do these special billings in the year compared to the 2025 year, which was also a very successful year, by the way. I think that the new job that Scott just talked to you about, those two elements were worthwhile for raising the range so quickly into the year. I'll tell you though, Julio, the thing that could still come, depending on the success, and there's always timing, right? You could always be paid on 1 January, right? For something that really was attributed this year, which is why I may be a little bit gun-shy.

Speaker #4: I'll tell you, though, Julio, the thing that could still come—depending on the success, there's always timing, right? You could always be paid on January 1st, right, for something that really was attributed this year.

Speaker #4: Which is why it may be a little bit of gunshy, but there's—I mean, it is very possible that—that cash flows could go up another clip of $10 million, you know, or more, in the range to—to be, to be, broadcast in the future, right?

Speaker #4: And I think that the new job that Scott just talked to you about, those two elements were worthwhile for raising the range so quickly into the year.

Speaker #4: I'll tell you though, Julio, the thing that could still come depending on the success, and there's always timing, right? You could always be paid on January 1st, right, for something that really was attributed this year, which is why I may be a little bit of gunshy.

Speaker #4: So, not—not—not unheard of to think of, $60 million or more for—uh, for free cash or for—for the company.

Julio Romero: Thanks. Hey, good morning. Scott and Aaron.

Scott Montross: Good morning, Julio.

Aaron: Good morning.

Aaron Wilkins: Good morning.

Julio Romero: Good morning. Scott, I appreciate the significant previously unplanned project is under NDA. You know, to the extent that you can, could you maybe help us understand, you know, at a high level, you know, how additive the project is to your 2026 outlook, whether it goes beyond 2026, you know, potentially to 2027? Secondly, should we think of this as kind of a one-off or does it have the potential to lead to additional phases or repeat business with that customer?

Speaker #3: Understood. Very helpful there. And one more for me is, you know, you have record backlog of 430 million, in WTS and with—including confirmed orders.

Speaker #4: But I mean, it is very possible that cash flows could go up another clip of $10 million or more in the ranges to be broadcast in the future, right?

Aaron Wilkins: I mean, it is very possible that the cash flows could go up another clip of $10 million, you know, or more in the ranges to be broadcast in the future, right? Not unheard of to think of $60 million or more for a free cash year for the company.

Speaker #3: Can you maybe just help us think about where your capacity utilization stands for that segment, and would you be able to take on additional work from here?

Speaker #4: So not unheard of to think of $60 million or more for a free cash year for the company.

Speaker #4: Yeah. We—we don't have, we—we can take on a lot more work than we have right now with capacity utilization with the capacity we have spread across the country and our plants.

Speaker #3: Understood. Very helpful, Barry. One more for me is you have record backlog of 430 million in WTS including confirmed orders. Can you maybe just help us think about where your capacity utilization stands for that segment and would you be able to take on kind of additional work from here?

Julio Romero: Understood. Very helpful there. One more from me is, you have record backlog of $430 million in WTS and with including confirmed orders. Can you maybe just help us think about where your capacity utilization stands for that segment? Would you be able to take on kind of additional work from here?

Speaker #4: Now, we—we have—we would have to move stuff between plants, but we have—we have plenty more room to take on additional work as we go forward because capacity utilization, if we're much over probably 70 or 72% in—in the water transmission systems business, that's probably about a high point.

Scott Montross: Like you said, we're under NDA. It's a government-related project. It's being produced at multiple of our plants. What I would tell you is it looks like this piece of the project, because there are, from what we understand, multiple other pieces of this project as we go forward, into the future, is right in the area of about $50 million. Okay? The, you know, the real question is it's a relatively short-fused job that is scheduled to be produced really in the late Q2, Q3, going into about the mid Q4 of this year. That segment is expected to be done.

Speaker #4: Yeah. We don't have we can take on a lot more work than we have right now with capacity utilization with the capacity we have spread across the country and our plants.

Scott Montross: Yeah. We can take on a lot more work than we have right now with the capacity we have spread across the country in our plants. Now, we would have to move stuff between plants, but we have plenty more room to take on additional work as we go forward. Capacity utilization, if we're much over probably 70% or 72% in the Water Transmission Systems business, that's probably about a high point for us at this point. Really, you know, you can obviously add additional shifts too, if we need to, which we do at certain plants at certain times when it's busy enough.

Speaker #4: We're just at this point, and—and really, you know, you can actually add additional shifts to if we—if we need to, which we do at certain points.

Speaker #4: Now, it would have we would have to move stuff between plants, but we have plenty more room to take on additional work as we go forward.

Speaker #4: It—it—at certain times when it's—when it's busy enough. So, you know, we—we have a lot more room to produce a lot more, Julio, and—and I—and—and are ready to do so.

Speaker #4: Because capacity utilization, if we're much over probably 70 or 72 percent in the water transmission systems business, that's probably about a high point, 4 to 6 this point.

Speaker #3: Excellent. Thanks for the color and Mr. Block.

Speaker #4: Thank you. Thanks, Julio.

Speaker #5: And as a reminder, if you would like to ask a question, please press star one at this time, and we'll pause for just a moment.

Scott Montross: I think one of the challenging things is right now is there's a little bit more of a question on how quickly you can get all the steel to do it. There is a potential that some of it could leak into next year. The understanding we have of these projects is there's multiple phases of these things that are planned right now that go out into the future that could be additive to other years as we go into the future. I think that's probably as clean of a look as I can give you, Julio, on the thing.

Speaker #4: And really, you can obviously add additional shifts too if we need to, which we do at certain plants at certain times when it's busy enough.

Speaker #4: So yeah, we have a lot more room to produce a lot more, Julio, and are ready to do so.

Scott Montross: Yeah, we have a lot more room to produce a lot more, Julio, and are ready to do so.

Speaker #5: And at this time, there are no further questions. I would like to turn the call back over to Scott Montross for closing remarks.

Speaker #4: So yeah. So just like to—to—to wrap up by—by saying that thank you for everybody for joining the call. Like always, and obviously, we delivered a very strong start to 2026.

Speaker #3: Excellent. Thanks for all the color and best of luck.

Julio Romero: Excellent. Thanks for all the color and best of luck.

Speaker #4: Thank you. Thanks, Julio.

Scott Montross: Thank you.

Aaron Wilkins: Thanks, Julio.

Speaker #1: And as a reminder, if you would like to ask a question, please press star one at this time and we'll pause for just a moment.

Operator: As a reminder, if you would like to ask a question, please press star one at this time, and we'll pause for just a moment. At this time, there are no further questions. I would like to turn the call back over to Scott Montross for closing remarks.

Speaker #4: I think we're at a point now where we can say that the—that the company is hitting on all cylinders now with the things that we've seen.

Julio Romero: Absolutely. I really appreciate the color you gave with that answer. I think you kind of hit the points I was looking for there. you know, on your cash flow in the quarter, it was very strong. It looks like your net contract asset position improved pretty meaningfully, driven by contract liabilities. Can you give us any more color on what drove that increase, and is it tied to that one-off, that project or any other larger WTS projects?

Speaker #4: You know, the—the—the bidding outside of the—the—that project to special project that's under NDA in the first quarter on water transmission was probably the strongest we've seen in really probably the strongest booking quarter that we've ever had on the water transmission side of the business.

Speaker #1: And at this time, there are no further questions. I would like to turn the call back over to Scott Montrose for closing remarks.

Speaker #4: So yeah, so just like to wrap up by saying that thank you for everybody for joining the call. Like always, and obviously, we delivered a very strong start to 2026.

Scott Montross: Yes, I'd just like to wrap up by saying that thank you for everybody for joining the call, like always. Obviously, we delivered a very strong start to 2026. I think we're at a point now we can say that the company is hitting on all cylinders now with the things that we are seeing. You know, the bidding outside of the that project, it's a special project, it's under NDA in Q1 on Water Transmission was probably the strongest we've seen it and really probably the strongest booking quarter that we've ever had on the Water Transmission side of the business. We've got significant momentum going forward on the Water Transmission side. On the Precast side, again, we are seeing a lot work around data centers.

Speaker #4: So—so we've got significant momentum going forward on the water transmission side. And on the precast side, again, we are—we are seeing a lot of work around data centers.

Aaron: Yeah. Hi, Julio. The cash flows for the business obviously can be a little bit challenging to forecast because they can at times be a little lumpy, which is normal. In, you know, really what happened and what continues to be a focus for our Water Transmission System commercial teams is to drive what I call trying to get the steel, the build in advance of the project, get MOH payments and progress payments throughout the job. That is something that over the span of the last 3 years, we are seeing growing success at. It is still negotiated individually with the specific customers, but we're able to do that more often than we used to be able to do it.

Aaron Wilkins: Yeah. Hi, Julio. The cash flows for the business obviously can be a little bit challenging to forecast because they can at times be a little lumpy, which is normal. In, you know, really what happened and what continues to be a focus for our Water Transmission System commercial teams is to drive what I call trying to get the steel, the build in advance of the project, get MOH payments and progress payments throughout the job. That is something that over the span of the last 3 years, we are seeing growing success at. It is still negotiated individually with the specific customers, but we're able to do that more often than we used to be able to do it.

Speaker #4: I think we're at a point now we can say that the company is hitting on all cylinders now with the things that we are seeing.

Speaker #4: you know, data centers is one of the—are one of the things that's really booing the commercial construction side of the business now, and the two states that we're in on the precast side, primarily in—in Texas, and in Utah, are—are very strong data center, centers.

Speaker #4: The bidding outside of the project, it's a special project. It's under NDA. In the first quarter on water transmission was probably the strongest we've seen and really probably the strongest booking quarter that we've ever had on the water transmission side of the business.

Speaker #4: I think there's something like 140 projects going on in Texas that, obviously we're taking part in. And other projects going on in Utah, which is becoming more of a—almost more of a giga site for—for, data centers where there's really—really large ones being built.

Speaker #4: So we've got significant momentum going forward on the water transmission side. And on the precast side, again, we are seeing a lot of work around data centers.

Speaker #4: And even with a little bit of the slowdown that's—that's been—been discussed, in the press on the residential side of the business, you know, we're still seeing very strong precast business, and we're seeing slowdown on residential site for example at our Geneva business.

Speaker #4: Data centers is one of the things that's really booing the commercial construction side of the business now and the two states that we're in on the precast side, primarily in Texas and in Utah, are very strong data center centers.

Scott Montross: You know, data centers are one of the things that's really buoying the commercial construction side of the business now. The two states that we're in on the Precast side, primarily in Texas and in Utah, are very strong data center centers. I think there's something like 140 projects going on in Texas that, obviously we're taking part in. Other projects going on in Utah, which is becoming almost more of a giga site for data centers where there's really large ones being built. Even with a little bit of the slowdown that's been discussed in the press on the residential side of the business, you know, we're still seeing very strong Precast business.

Aaron: Really, what happened was we had a $20 million collection on one of those special billings come in in the month, I think it was the month of February or March. You'll notice that our accounts receivable remains elevated, which means that we're still doing a great job of billing customers. That is because we have, also on a completely separate job, billed another customer for $20 million, a little over $20 million, and that has since been received. The business model really is being driven to get the cash flows as a focus and, you know, that's why, you know, in part at least, I had to raise our range, our guidance for free cash for 2026.

Aaron Wilkins: Really, what happened was we had a $20 million collection on one of those special billings come in in the month, I think it was the month of February or March. You'll notice that our accounts receivable remains elevated, which means that we're still doing a great job of billing customers. That is because we have, also on a completely separate job, billed another customer for $20 million, a little over $20 million, and that has since been received. The business model really is being driven to get the cash flows as a focus and, you know, that's why, you know, in part at least, I had to raise our range, our guidance for free cash for 2026.

Speaker #4: We're ma—it's being picked right up on the non-residential side, and the precast business continues to grow. And I think the biggest thing is we—we continue to advance our strategy going forward with both organic growth and M&A, and we're going to continue to do that.

Speaker #4: I think there's something like 140 projects going on in Texas that obviously we're taking part in. And other projects going on in Utah, which is becoming more of a almost more of a gigasite for data centers where there's really, really large ones being built.

Speaker #4: And like I said, we expect a—a strong second quarter, when we looked at projections for 2026, even before we looked at a—uh, a year that, we had this special project that came forward, we were projecting it was going to be another record year, strong in 2025.

Speaker #4: And even with a little bit of the slowdown that's been discussed in the press on the residential side of the business, we're still seeing very strong precast business and where we've seen slowdown on residential side for example, at our Geneva businesses, where that's being picked right up on the non-residential side.

Scott Montross: Where we've seen slowdown on residential side, for example, at our Geneva businesses, that's being picked right up on the non-residential side, and the Precast business continues to grow. I think the biggest thing is we continue to advance our strategy going forward with both organic growth and M&A, and we're going to continue to do that. Like I said, we expect a strong Q2. When we looked at the projections for 2026, even before we looked at a year that we had this special project that came forward, we were projecting it was going to be another record year and stronger than 2025. This big project is just additive to that. I think, again, we're hitting on all cylinders.

Speaker #4: And this big project is just additive to that. And I think, again, we're hitting on all cylinders, we appreciate your support as shareholders, and—and—and our analyst support, so thank you.

Speaker #4: And the precast business continues to grow. And I think the biggest thing is we continue to advance our strategy, going forward with both organic growth and M&A, and we're going to continue to do that.

Speaker #4: And we'll see you in—I think it's, late July. So thank you very much.

Aaron: I think we're gonna be more successful. I think there's more opportunities for the WTS team to do these special billings in the year compared to the 2025 year, which was also a very successful year, by the way. I think that the new job that Scott just talked to you about, those two elements were worthwhile for raising the range so quickly into the year. I'll tell you though, Julio, the thing that could still come, depending on the success, and there's always timing, right? You could always be paid on 1 January, right? For something that really was attributed this year, which is why I may be a little bit gun shy.

Aaron Wilkins: I think we're gonna be more successful. I think there's more opportunities for the WTS team to do these special billings in the year compared to the 2025 year, which was also a very successful year, by the way. I think that the new job that Scott just talked to you about, those two elements were worthwhile for raising the range so quickly into the year. I'll tell you though, Julio, the thing that could still come, depending on the success, and there's always timing, right? You could always be paid on 1 January, right? For something that really was attributed this year, which is why I may be a little bit gun shy.

Speaker #4: Like I said, we expect a strong second quarter. When we looked at the projections for 2026, even before we looked at a year that we had this special project that came forward, we were projecting it was going to be another record year and stronger than 2025.

Speaker #4: And this big project is just additive to that. And I think, again, we're hitting on all cylinders. We appreciate your support as shareholders and our analyst support.

Scott Montross: We appreciate your support as shareholders and our analyst support. Thank you.

Aaron: I mean, it is very possible that cash flows could go up another clip of $10 million, you know, or more in the ranges to be broadcast in the future, right? Not unheard of to think of $60 million or more for a free cash year for the company.

Aaron Wilkins: I mean, it is very possible that cash flows could go up another clip of $10 million, you know, or more in the ranges to be broadcast in the future, right? Not unheard of to think of $60 million or more for a free cash year for the company.

Speaker #4: So thank you. And we'll see you in I think it's late July. Late July. So thank you very much.

Aaron Wilkins: I think it's late July.

Scott Montross: Late July. Thank you very much.

Operator: Thank you. This does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time.

Julio Romero: Understood. Very helpful there. One more from me is, you know, you have record backlog of $430 million in WTS and with including confirmed orders. Can you maybe just help us think about where your capacity utilization stands for that segment? Would you be able to take on kind of additional work from here?

Scott Montross: Yeah. We can take on a lot more work than we have right now with the capacity we have spread across the country in our plants. Now, we would have to move stuff between plants, but we have plenty more room to take on additional work as we go forward. Capacity utilization, if we're much over probably 70% or 72% in the water transmission systems business, that's probably about a high point for us at this point.

Scott Montross: Really, you know, you can obviously add additional shifts too, if we, if we need to, which we do at certain plants at certain times when it's, when it's busy enough. Yeah, we have a lot more room to produce a lot more, Julio, and are ready to do so.

Julio Romero: Excellent. Thanks for all the color and best of luck.

Scott Montross: Thank you.

Aaron: Thanks, Julio.

Aaron Wilkins: Thanks, Julio.

Scott Montross: Yes, I'd just like to wrap up by saying that thank you for everybody for joining the call, like always. Obviously, we delivered a very strong start to 2026. I think we're at a point now we can say that the company is hitting on all cylinders now with the things that we are seeing. You know, the bidding outside of that project, it's a special project, it's under NDA, in Q1 on water transmission was probably the strongest we've seen it and really probably the strongest booking quarter that we've ever had on the water transmission side of the business. We've got significant momentum going forward on the water transmission side. On the precast side, again, we are seeing a lot work around data centers.

Scott Montross: You know, data centers are one of the things that's really buoying the commercial construction side of the business now. The two states that we're in on the precast side, primarily in Texas and in Utah, are very strong data center centers. I think there's something like 140 projects going on in Texas that, obviously we're taking part in and other projects going on in Utah, which is becoming almost more of a gigasite for data centers where there's really large ones being built. Even with a little bit of the slowdown that's been discussed in the press on the residential side of the business, you know, we're still seeing very strong precast business.

Scott Montross: Where we've seen slowdown on residential side, for example, at our Geneva businesses, that's being picked right up on the non-residential side, and the precast business continues to grow. I think the biggest thing is we continue to advance our strategy going forward with both organic growth and M&A, and we're going to continue to do that. Like I said, we expect a strong Q2. When we looked at the projections for 2026, even before we looked at a year that we had this special project that came forward, we were projecting it was going to be another record year and stronger than 2025. This big project is just additive to that. I think, again, we're hitting on all cylinders.

Scott Montross: We appreciate your support as shareholders and our analyst support. Thank you, and we'll see you in.

Aaron: Late July.

Aaron Wilkins: Late July.

Scott Montross: Late July. Thank you very much.

Operator: Thank you. This does conclude today's teleconference. We thank you for your participation. You may disconnect your lines at this time.

Q1 2026 NWPX Infrastructure Earnings Call

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