Q1 2026 Shimmick Corp Earnings Call

May 14, 2026

Speaker #1: In the water that sustains communities, in the energy that powers industry, in the connections that bring people closer together—for more than a century, we've earned trust by doing things the right way.

[Company Representative] (Shimmick): For more than a century, we've earned trust by doing things the right way, with integrity, safety, and excellence. We don't just deliver projects. We build the systems people count on every day. We protect and move water, designing and building treatment and conveyance systems that sustain this critical resource, focusing on communities and the environment. Power, today more than ever, keeps our world running, and we provide electrical expertise for the modern age. Axia Electric, our specialty electrical construction subsidiary, delivers the electrical systems that make technology, industry, and everyday life work. We build the bridges and transit systems that move people and opportunity forward safely and efficiently, helping cities move better, grow stronger, and connect more seamlessly. We strengthen coastlines and communities, designing and constructing levees, flood walls, and sea level defense systems that protect people, property.

[Video Narrator]: For more than a century, we've earned trust by doing things the right way, with integrity, safety, and excellence. We don't just deliver projects. We build the systems people count on every day. We protect and move water, designing and building treatment and conveyance systems that sustain this critical resource, focusing on communities and the environment. Power, today more than ever, keeps our world running, and we provide electrical expertise for the modern age. Axia Electric, our specialty electrical construction subsidiary, delivers the electrical systems that make technology, industry, and everyday life work. We build the bridges and transit systems that move people and opportunity forward safely and efficiently, helping cities move better, grow stronger, and connect more seamlessly. We strengthen coastlines and communities, designing and constructing levees, flood walls, and sea level defense systems that protect people, property.

Speaker #1: With integrity, safety, and excellence. We don't just deliver projects; we build the systems people count on every day. We protect and move water, designing and building treatment and conveyance systems that sustain this critical resource, focusing on communities and the environment.

Speaker #1: Power, today more than ever, keeps our world running, and we provide electrical expertise for the modern age. Axia Electric, our specialty electrical construction subsidiary, delivers the electrical systems that make technology, industry, and everyday life work.

Speaker #1: We build the bridges and transit systems that move people and opportunity forward, safely and efficiently, helping cities move better, grow stronger, and connect more seamlessly.

Speaker #1: We strengthen coastlines and communities, designing and constructing levees, flood walls, and sea-level defense systems that protect people, property, and.

Speaker #2: Good afternoon, and thank you for joining us on today's conference call to discuss Shimmick's first quarter 2026 results. Slides for today's presentation are available on the Investor Relations section of our website, www.shimmick.com.

[Company Representative] (Shimmick): Good afternoon. Thank you for joining us on today's conference call to discuss Shimmick's Q1 2026 results. Slides for today's presentation are available on the investor relations section of our website, www.shimmick.com. During this conference call, management will make forward-looking statements based on current expectations and assumptions, which are subject to risks and uncertainties. Actual results could differ materially from our forward-looking statements if any of our key assumptions are incorrect. We identify the principal risks and uncertainties that may affect our performance in our reports and filings with the Securities and Exchange Commission, which can also be found on our investor relations website. We do not undertake any duty to update any forward-looking statements. Today's presentation also includes references to non-GAAP financial measures.

Anthony Rasmus: Good afternoon. Thank you for joining us on today's conference call to discuss Shimmick's Q1 2026 results. Slides for today's presentation are available on the investor relations section of our website, www.shimmick.com. During this conference call, management will make forward-looking statements based on current expectations and assumptions, which are subject to risks and uncertainties. Actual results could differ materially from our forward-looking statements if any of our key assumptions are incorrect. We identify the principal risks and uncertainties that may affect our performance in our reports and filings with the Securities and Exchange Commission, which can also be found on our investor relations website. We do not undertake any duty to update any forward-looking statements. Today's presentation also includes references to Non-GAAP financial measures.

Speaker #2: During this conference call, management will make forward-looking statements based on current expectations and assumptions which are subject to risk and uncertainties. Actual results could differ materially from our forward-looking statements if any of our key assumptions are incorrect.

Speaker #2: We identify the principal risks and uncertainties that may affect our performance in our reports and filings with the Securities and Exchange Commission, which can also be found on our Investor Relations website.

Speaker #2: We do not undertake any duty to update any forward-looking statements. Today's presentation also includes references to non-GAAP financial measures. You should refer to the information contained in the company's first quarter press release for definitional information and reconciliations of historical non-GAAP measures to the comparable GAAP financial measures.

[Company Representative] (Shimmick): You should refer to the information contained in the company's Q1 press release for definitional information and reconciliations of historical non-GAAP measures to the comparable GAAP financial measures. With that, it is my pleasure to turn the call over to Ural Yal, Shimmick's CEO.

Anthony Rasmus: You should refer to the information contained in the company's Q1 press release for definitional information and reconciliations of historical Non-GAAP measures to the comparable GAAP financial measures. With that, it is my pleasure to turn the call over to Ural Yal, Shimmick's Chief Executive Officer.

Speaker #2: With that is my pleasure to turn the call over to Ural Yal, Shimmick's CEO.

Speaker #3: Good afternoon, and thank you all for joining us on today's call. I'm joined by Todd Yoder, Shimmick CFO. As always, I would like to recognize the men and women who work at Shimmick, safely and effectively delivering the projects we take on.

Ural Yal: Good afternoon, thank you all for joining us on today's call. I'm joined by Todd Yoder, Shimmick's CFO. As always, I would like to recognize the men and women who work at Shimmick, safely and effectively delivering the projects we take on. We're all very proud of the work we put in every day that makes a real difference in communities across the states we operate in. With that, I'm going to start by discussing our financial results for Q1 2026. I'm pleased to report that we are continuing to make progress on our strategy, which centers around growing our top line by bidding and winning work aligned with our expertise, winding down non-core projects, and executing at a high level to deliver consistent margins.

Ural Yal: Good afternoon, thank you all for joining us on today's call. I'm joined by Todd Yoder, Shimmick's Chief Financial Officer. As always, I would like to recognize the men and women who work at Shimmick, safely and effectively delivering the projects we take on. We're all very proud of the work we put in every day that makes a real difference in communities across the states we operate in. With that, I'm going to start by discussing our financial results for Q1 2026. I'm pleased to report that we are continuing to make progress on our strategy, which centers around growing our top line by bidding and winning work aligned with our expertise, winding down non-core projects, and executing at a high level to deliver consistent margins.

Speaker #3: We're all very proud of the work we put in every day that makes a real difference in communities across the states we operate in.

Speaker #3: With that, I'm going to start by discussing our financial results for the first quarter of 2026. I'm pleased to report that we are continuing to make progress on our strategy, which centers around growing our top line by bidding and winning work aligned with our expertise, winding down non-core projects, and executing at a high level to deliver consistent margins.

Speaker #3: For the first quarter, we delivered consolidated revenue of $88 million, 12% gross margin, and adjusted EBITDA of approximately $3 million. We expanded our gross margin on Shimmick projects to 11% and 89% improvement over last year.

Ural Yal: For Q1, we delivered consolidated revenue of $88 million, 12% gross margin, and adjusted EBITDA of approximately $3 million. We expanded our gross margin on Shimmick projects to 11%, an 89% improvement over last year. We're already seeing increasing monthly top-line revenues as the winter weather subsides and new projects start to ramp up. What's important also is the trajectory. We now have secured and continuing to secure backlog that is going to fuel our growth the rest of the year and beyond. We are excited by the progress we're making on our backlog and have achieved our highest book-to-burn ratio since the company went public, reflecting strong demand and improving project quality.

Speaker #3: We're already seeing increasing monthly top-line revenues as the winter weather subsides and new projects start to ramp up. What's important also is the trajectory.

Speaker #3: We now have secured and continuing to secure backlog that is going to fuel our growth the rest of the year and beyond. We are excited by the progress we're making on our backlog and have achieved our highest book-to-burn ratio since the company went public, reflecting strong demand and improving project quality.

Speaker #3: At the same time, we continue to scale Shimmick projects as a percentage of the overall portfolio, with non-core work now representing less than 5% of total backlog, further supporting visibility and execution consistency going forward.

Ural Yal: At the same time, we continue to scale Shimmick projects as a percentage of the overall portfolio, with non-core work now representing less than 5% of total backlog, further supporting visibility and execution consistency going forward. Looking forward, we expect activities on existing and newly won projects pick up as we head into the summer months. July, August, and September are when we expect to see more visible inflection in revenue as new projects begin generating consistent burn. Meanwhile, we're continuing to win new work, and our teams are well-positioned to deliver consistent and growing revenues. For our non-core projects, revenue was $200,000 compared to $29 million a year ago, largely as a result of the termination by the U.S. Army Corps of Engineers of the Chickamauga Lock Replacement Project in Chattanooga, Tennessee, which I'd like to address in more detail.

Speaker #3: Looking forward, we expect activities on existing and newly won projects to pick up as we head into the summer months. July, August, and September are when we expect to see more visible inflection in revenue as new projects begin generating consistent burn.

Speaker #3: Meanwhile, we're continuing to win new work, and our teams are well positioned to deliver consistent and growing revenues. For our non-core projects, revenue was $200,000 compared to $29 million a year ago, largely as a result of the termination by the US Army Corps of Engineers of the Chickamauga Lock Replacement Project in Chattanooga, Tennessee, which I'd like to address in more detail.

Speaker #3: From time to time, differences of view arise on projects, including scope of work and schedules, and in this instance, the matter is proceeding through the customary federal process.

Ural Yal: From time to time, differences of view arise on projects, including scope of work and schedules. In this instance, the matter is proceeding through the customary federal process. We remain constructive in our approach, appreciate our clients' focus on project completion, and are confident that the parties will be able to reach a mutually agreeable resolution in due course. Importantly, this situation does not affect our broader relationship with the U.S. Army Corps of Engineers, who has been a long-term client for us, with our first projects dating back to the nineteen-forties through our legacy companies. We currently have 2 other projects underway with the Corps, 1 approximately halfway complete and the other 1 nearing completion. These projects continue to progress as planned.

Ural Yal: From time to time, differences of view arise on projects, including scope of work and schedules. In this instance, the matter is proceeding through the customary federal process. We remain constructive in our approach, appreciate our clients' focus on project completion, and are confident that the parties will be able to reach a mutually agreeable resolution in due course. Importantly, this situation does not affect our broader relationship with the U.S. Army Corps of Engineers, who has been a long-term client for us, with our first projects dating back to the 1940s through our legacy companies. We currently have two other projects underway with the Corps, one approximately halfway complete and the other one nearing completion. These projects continue to progress as planned.

Speaker #3: We remain constructive in our approach, appreciate our clients' focus on project completion, and are confident that the parties will be able to reach a mutually agreeable resolution in due course.

Speaker #3: Importantly, this situation does not affect our broader relationship with the US Army Corps of Engineers, who has been a long-term client for us without first projects dating back to the 1940s through our legacy companies.

Speaker #3: We currently have two other projects underway with the Corps, one approximately halfway complete and the other one nearing completion, and these projects continue to progress as planned.

Speaker #3: As we continue to wind down non-core activities, this development further reduces our remaining non-core backlog to under 5%, allowing us to remain focused on our core priorities.

Ural Yal: As we continue to wind down non-core activities, this development further reduces our remaining non-core backlog to under 5%, allowing us to remain focused on our core priorities. I'd like to spend some more time digging into our progress, provide an update on market conditions, and discuss our continued focus on execution. We continue to see strong momentum across our core geographies, highlighted by our ongoing success winning work in Texas and sustained bidding activity across the platform. Importantly, the work we are booking is firm, contracts are signed, visibility is solid, and the projects we've added to backlog are scheduled to begin ramping up this year. This gives us confidence not just in demand, but in timing and execution as we move through the balance of 2026. We're seeing healthy demand across our end markets and improved selectivity in the work we pursue.

Speaker #3: Now, I'd like to spend some more time digging into our progress, provide an update on market conditions, and discuss our continued focus on execution.

Speaker #3: We continue to see strong momentum across our core geographies, highlighted by our ongoing success-winning work in Texas, and sustained bidding activity across the platform.

Speaker #3: Importantly, the work we are booking is firm, contracts are signed, visibility is solid, and the projects we've added to backlog are scheduled to begin ramping up this year.

Speaker #3: This gives us confidence not just in demand, but in timing and execution, as we move through the balance of 2026. We're seeing healthy demand across our end markets and improved selectivity in the work we pursue.

Speaker #3: This momentum reflects the collective efforts of our teams across the organization, and our focus remains on sustaining a book-to-burn profile that supports consistent growth and improved revenue visibility over time.

Ural Yal: This momentum reflects the collective efforts of our teams across the organization, and our focus remains on sustaining a book-to-burn profile that supports consistent growth and improved revenue visibility over time. With that backdrop, Axia continues to perform well, and we're encouraged by the growth and momentum we're seeing in the segment. The electrical business remains an important pillar of our long-term strategy, and Axia's progress reinforces our confidence in that vertical as we look to further expand capabilities and market share. We're also seeing increasing opportunity in data centers, which remains an attractive and growing end market for us. Today, we have multiple active bids in Reno and in Texas, and we are in regular dialogue with those customers.

Speaker #3: With that backdrop, Axia continues to perform well, and we're encouraged by the growth and momentum we're seeing in the segment. The electrical business remains an important pillar of our long-term strategy, and Axia's progress reinforces our confidence in that vertical as we look to further expand capabilities and market share.

Speaker #3: We're also seeing increasing opportunity in data centers, which remains an attractive and growing end market for us. Today, we have multiple active bids in Reno and in Texas, and we are in regular dialogue with those customers.

Speaker #3: While still early, the level of engagement and inbound activity reinforces our view that data centers represent a compelling growth vertical over the medium and to long term.

Ural Yal: While it's still early, the level of engagement and inbound activity reinforces our view that data centers represent a compelling growth vertical over the medium and to long term. From a commercial standpoint, the environment looks very similar to last quarter, with a strong and growing backlog, a healthy pipeline of work, and several pending items we expect to convert over the next quarter or 2. Our overall 24-month pipeline remains robust, with expected $600 million to $1 billion in bidding volumes per month. Looking forward, our pipeline continues to be a real strength, allowing us to grow our revenues and margins while being selective and strategic about what we pursue. Our elevated level of bidding activity translated directly into meaningful backlog growth during the quarter, with the total backlog increasing to $944 million at the end of Q1 2026.

Speaker #3: From a commercial standpoint, the environment looks very similar to last quarter, with a strong and growing backlog, a healthy pipeline of work, and several pending items we expect to convert over the next quarter or two.

Speaker #3: Our overall 24-month pipeline remains robust, with expected $600 million to $1 billion in bidding volumes per month. Looking forward, our pipeline continues to be a real strength, allowing us to grow our revenues and margins while being selective and strategic about what we pursue.

Speaker #3: Our elevated level of bidding activity translated directly into meaningful backlog growth during the quarter, with the total backlog increasing to $944 million at the end of the first quarter of 2026.

Speaker #3: This represents our highest backlog level in more than two years, reflecting both improved win rates and continued discipline around the work we pursue. This momentum is also evident in our book-to-burn ratio of 2.6 in the first quarter.

Ural Yal: This represent our highest backlog level in more than two years, reflecting both improved win rates and continued discipline around the work we pursue. This momentum is also evident in our book-to-burn ratio of 2.6 in Q1. During Q1, we booked $289 million in new work. Taken together, these wins enhance revenue visibility and support our expectation for accelerated growth as projects begin to ramp up over the course of the year. These new projects include major flood protection and stormwater infrastructure projects in California, as well as wastewater expansion work in Texas, reflecting strong demand for our core capabilities across our target markets. In California, we were awarded several water resources projects that speak to the critical nature of our work and our in-depth experience in the state.

Speaker #3: During the quarter, we booked $289 million in new work. Taken together, these wins enhance revenue visibility and support our expectation for accelerated growth as projects begin to ramp up over the course of the year.

Speaker #3: These new projects include major flood protection and stormwater infrastructure projects in California, as well as wastewater expansion work in Texas, reflecting strong demand for our core capabilities across our target markets.

Speaker #3: In California, we were awarded several water resources projects that speak to the critical nature of our work and our in-depth experience in the state.

Speaker #3: In Northern California, the Vista Grande drainage basin improvements project represents a large-scale modernization of stormwater infrastructure designed to address chronic flooding challenges and improve resilience for the surrounding community.

Ural Yal: In Northern California, the Vista Grande Drainage Basin Improvements project represents a large-scale modernization of stormwater infrastructure designed to address chronic flooding challenges and improve resilience for the surrounding community. The project involves complex underground construction and integrated civil, mechanical, and electrical scopes, aligning well with our core self-perform capabilities. We were also awarded additional flood protection work in Napa, where we will construct new flood walls as part of the county's broader long-running flood management program. This project further expands our presence in Northern California and reinforces our role in delivering essential infrastructure that protects communities and local economies. In Texas, we continue to see attractive opportunities tied to population growth and long-term infrastructure investment. During the quarter, we were selected for a wastewater treatment plant expansion project in Austin, supporting the city's efforts to increase capacity and meet rising demand.

Speaker #3: The project involves complex underground construction and integrated civil, mechanical, and electrical scopes, aligning well with our core self-perform capabilities. We were also awarded additional flood protection work in Napa, where we will construct new flood walls as part of the county's broader long-running flood management program.

Speaker #3: This project further expands our presence in Northern California and reinforces our role in delivering essential infrastructure that protects communities and local economies. And in Texas, we continue to see attractive opportunities tied to population growth and long-term infrastructure investment.

Speaker #3: During the quarter, we were selected for a wastewater treatment plant expansion project in Austin, supporting the city's efforts to increase capacity and meet rising demand.

Speaker #3: The scope includes complex concrete structures, underground systems, and process-related infrastructure, and reflects continued demand for our technical expertise in water and wastewater markets. Our strategies focus on improving execution, so revenue growth translates into stronger and more consistent net income.

Ural Yal: The scope includes complex concrete structures, underground systems, and process-related infrastructure and reflects continued demand for our technical expertise in water and wastewater markets. Our strategy is focused on improving execution so revenue growth translates into stronger and more consistent net income. That starts with operational discipline. We've been implementing targeted enhancements across the business to improve visibility, accountability, and decision-making as we scale. Experienced leadership is a key part of that. In April, we announced the appointment of Sarah Tacker as Executive Vice President and Chief Operating Officer. We continue to bolster our management team with hands-on operational experience at scale, which is driving more disciplined project execution and risk management. We're also strengthening our project controls and technology, giving us better insight into cost, schedule, and productivity. This allows us to identify issues earlier and manage performance more proactively.

Speaker #3: That starts with operational discipline. We've been implementing targeted enhancements across the business to improve visibility, accountability, and decision-making as we scale. Experienced leadership is a key part of that.

Speaker #3: In April, we announced the appointment of Sarah Tacker as executive vice president and chief operating officer. We continue to bolster our management team with hands-on operational experience at scale, which is driving more disciplined project execution and risk management.

Speaker #3: We're also strengthening our project controls and technology, giving us better insight into costs, schedule, and productivity. This allows us to identify issues earlier and manage performance more proactively.

Speaker #3: Centralized procurement is improving purchasing efficiency and cost control by leveraging our scale and standardizing processes across the organization. And talent retention and acquisition remain a top priority for us.

Ural Yal: Centralized procurement is improving purchasing efficiency and cost control by leveraging our scale and standardizing processes across the organization. Talent retention and acquisition remain a top priority for us. Having the right people in place is critical to executing our strategy effectively in a competitive labor market. Additionally, we continue to advance our shift towards more collaborative contracting models. Subsequent to quarter end, we were selected for a project with California Water Service for a wastewater treatment plant in Southern California, delivered through a Progressive Design-Build contract with an estimated construction value of $50 million. While this opportunity is not reflected in our quarter end backlog, it showcases demand for our capabilities and supports our strategic focus on projects that give us an an opportunity to partner with our clients earlier in the project life cycle.

Speaker #3: Having the right people in place is critical to executing our strategy effectively in a competitive labor market. Additionally, we continue to advance our shift towards more collaborative contracting models.

Speaker #3: Subsequent to quarter end, we were selected for a project with California Water Service for a wastewater treatment plant in Southern California, delivered through a progressive design-build contract with an estimated construction value of $50 million.

Speaker #3: While this opportunity is not reflected in our quarter-end backlog, it showcases demand for our capabilities and supports our strategic focus on projects that give us an opportunity to partner with our clients earlier in the project lifecycle.

Speaker #3: These projects support our strategy toward risk-balanced contracts, where we provide value to our clients through our technical expertise. With that, I'd like to turn to Todd, who will review our financials in more detail.

Ural Yal: These projects support our strategy toward risk-balanced contracts where we provide value to our clients through our technical expertise. With that, I'd like to turn to Todd, who will review our financials in more detail.

Speaker #1: Thank you for joining us today. The Shimmick team has delivered another solid quarter of performance. And we are seeing our strategic changes over the past year continue to drive results, not only drive year-over-year improvements, but more importantly, establishing the foundation for continued growth and profitability moving forward.

Todd Yoder: Thank you for joining us today. The Shimmick team has delivered another solid quarter of performance, and we are seeing our strategic changes over the past year continue to drive results, not only drive year-over-year improvements, but more importantly, establishing the foundation for continued growth and profitability moving forward. Before I hit the financials, I just wanna echo Ural in thanking all of the talented men and women across Shimmick. I thank each of you for your continued commitment to executing the strategy, your focus on safety, which is the most important thing we do, your commitment to the quality of the work we deliver to our clients every day, and your dedication to executing with excellence.

Speaker #1: Before I hit the financials, I just want to echo Ural in thanking all of the talented men and women across Shimmick. I thank each of you for your continued commitment to executing the strategy, your focus on safety, which is the most important thing we do, your commitment to the quality of the work we deliver to our clients every day, and your dedication to executing with excellence.

Speaker #1: Your contributions have had a significant impact on the achievements we've made over the past 15 months, and put us in a strong position to continue growing the business and winning the right way.

Todd Yoder: Your contributions have had a significant impact on the achievements we've made over the past 15 months, and put us in a strong position to continue growing the business and winning the right way. Now let's jump into the financial results. I have revenue and gross margin in slide 8, but I will talk about the overall performance for the quarter and reference additional information that is available on our 10-Q filing posted to our website. All comparisons I make will be on a quarter-over-quarter basis as compared to the same period in 2025, unless otherwise noted. Shimmick project revenue for Q1 2026 was $88 million, versus $93 million in Q1 of 2025.

Speaker #1: Now let's jump into the financial results. I have revenue and gross margin in slide 8, but I will talk to I will talk about the overall performance for the quarter and reference additional information that is available on our 10-Q filing posted to our website.

Speaker #1: All comparisons I make will be on a quarter-over-quarter basis, as compared to the same period in 2025, unless otherwise noted. Shimmick project revenue for Q1 2026 was $88 million, versus $93 million in Q1 of 2025.

Speaker #1: The net difference of $5 million was driven by prior-year projects reaching completion during 2025 or nearing completion and winding down earlier this year. Combined with lower burn on new projects, which we will continue to see ramp up throughout 2026.

Todd Yoder: The net difference of $5 million was driven by prior year projects reaching completion during 2025 or nearing completion and winding down earlier this year, combined with lower burn on new projects, which we will continue to see ramp up throughout 2026. Non-core project revenue for Q1 2026 was $200,000, nearly flat, down from $29 million in Q1 of 2025. The $29 million decrease was driven by the termination of the Chickamauga Lock replacement project, as well as a $10 million impact from the continued progress we've made in moving all non-core projects to completion. I've discussed the negative gross margin impact from non-core projects on our total gross margin on prior calls, and I couldn't be more excited to end the quarter with non-core backlog now less than 5% of our total backlog.

Speaker #1: Non-core project revenue for Q1 '26 was $200,000, nearly flat. Down from $29 million in Q1 of 2025. The $29 million decrease was driven by the termination of the Chickamauga Lock replacement project as well as a $10 million impact from the continued progress we've made in moving all non-core projects to completion.

Speaker #1: I've discussed the negative gross margin impact from non-core projects on our total gross margin on prior calls. And I couldn't be more excited to end the quarter with non-core backlog, now less than 5% of our total backlog.

Speaker #1: This means we will continue to see favorable mix impact on total gross margin moving forward on a year-over-year basis. Shimmick consolidated total revenue for Q1 '26 was $88 million, as compared to $122 million in Q1 of '25.

Todd Yoder: This means we will continue to see favorable mix impact on total gross margin moving forward on a year-over-year basis. Shimmick consolidated total revenue for Q1 2026 was $88 million, as compared to $122 million in Q1 2025. Shimmick project gross margin was $10 million for Q1 2026, up $5 million or 89%, as compared to $5 million in Q1 2025. Gross margin as a percentage of revenue was up significantly to 11% for Q1 2026, versus 6% for Q1 2025. The $5 million increase in gross margin was driven by $3 million from new projects and $2 million from existing projects. The non-core project gross margin was $1 million for Q1 2026, as compared to -$1 million for Q1 2025.

Speaker #1: Shimmick project gross margin was $10 million. For Q1 '26, up $5 million or $89%, as compared to $5 million in Q1 of '25. Gross margin as a percentage of revenue was up significantly, to 11% for Q1 of 2026.

Speaker #1: Versus 6% for Q1 of 2025. The $5 million increase in gross margin was driven by $3 million from new projects and $2 million from existing projects.

Speaker #1: The non-core project gross margin was $1 million for Q1 '26, as compared to negative $1 million for Q1 of 2025. The $2 million increase in gross margin was driven by a positive outcome from a project closeout, as well as cost overruns on non-core lost projects during the first quarter of 2025 that did not recur this year.

Todd Yoder: The 2 million increase in gross margin was driven by a positive outcome from a project closeout, as well as cost overruns on non-core loss projects during the first quarter of 2025 that did not recur this year. Shimmick consolidated total gross margin for Q1 2026 was $11 million, up $6 million or 132%, compared to $5 million of gross margin in Q1 2025. Total gross margin as a percentage of revenue improved to 12% from 4% in Q1 2025. G&A expense for Q1 2026 was $14 million, flat as compared to Q1 2025. This is as we continue to optimize our overhead while growing the business.

Speaker #1: Shimmick consolidated total gross margin for Q1 2026 was $11 million. Up $6 million or $132%, compared to $5 million of gross margin in Q1 of 2025.

Speaker #1: Total gross margin as a percentage of revenue improved to 12% from 4% in Q1 of 2025. G&A expense for Q1 '26 was $14 million, flat as compared to Q1 of 2025.

Speaker #1: This is as we continue to optimize our overhead while growing the business. Net loss for Q1 was $4 million, favorable $6 million or $55%, as compared to a net loss of $10 million in Q1 of 2025.

Todd Yoder: Net loss for Q1 was $4 million, favorable $6 million or 55% as compared to a net loss of $10 million in Q1 of 2025. Adjusted EBITDA for Q1 2026 was $3 million as compared to -$3 million in Q1 2025. The improvement was driven by the significant increase in gross margin from Shimmick projects on a year-over-year basis. Turning to liquidity, we ended Q1 with $34 million of liquidity. The $34 million consisted of unrestricted cash equivalents of $15 million and another $19 million of availability under our credit agreements.

Speaker #1: Adjusted EBITDA for Q1 '26 was $3 million. As compared to negative $3 million, in the first quarter 2025. The improvement was driven by the significant increase in gross margin from Shimmick projects on a year-over-year basis.

Speaker #1: Turning to liquidity, we ended the first quarter with $34 million of liquidity. The $34 million consisted of unrestricted cash, cash equivalents of $15 million and another $19 million of availability under our credit agreements.

Speaker #1: New awards booked during Q1 '26 were $289 million. A sequential increase of $150 million from Q4 of 2025. Giving us a book to burn of $2.6 for the quarter, which is the highest book to burn achieved since becoming a public company.

Todd Yoder: New awards booked during Q1 2026 were $289 million. A sequential increase of $150 million from Q4 2025, giving us a book-to-burn of 2.6 for the quarter, which is the highest book-to-burn achieved since becoming a public company. We ended the quarter with total backlog of $944 million. On slide nine, I have our 2026 full year guide. As I mentioned on our last call, we expected a slower start to 2026. Largely the first quarter was in line with our expectations. We expect quarter over quarter sequential improvement throughout the year as these new projects awards start to ramp up. Despite the termination of the Chickamauga Lock replacement project that I mentioned earlier, we are reaffirming our full year 2026 guidance.

Speaker #1: We ended the quarter with total backlog of $944 million. On slide 9, I have our 2026 full-year guide. As I mentioned on our last call, we expected a slower start to 2026, and largely the first quarter was in line with our expectations.

Speaker #1: We expect quarter-over-quarter sequential improvement throughout the year as these new projects awards start to ramp up. Despite the termination of the Chickamauga Lock replacement project that I mentioned earlier, we are reaffirming our full-year 2026 guidance.

Speaker #1: We expect Shimmick consolidated revenue to grow year-over-year between $12 and $22%. That is 17% at the midpoint, representing approximately $550 million to $600 million of work put in place for the full year 2026.

Todd Yoder: We expect Shimmick consolidated revenue to grow year over year between 12% and 22%. That is 17% at the midpoint, representing approximately $550 million to 600 million of work put in place for the full year 2026. We also expect adjusted EBITDA to increase year over year between 200% and 500%. That's 350% at the midpoint. We would finish the year with adjusted EBITDA in the range of $15 million to 30 million. With that, I wanna thank you for joining us today for your interest in Shimmick, and I'll turn it back to you, Ural.

Speaker #1: We also expect adjusted EBITDA to increase year-over-year between 200% and 500%. That's 350% at the midpoint. We would finish the year with adjusted EBITDA in the range of $15 million to $30 million.

Speaker #1: With that, I want to thank you for joining us today and for your interest in Shimmick. And I'll turn it back to Ural.

Speaker #2: Overall, we are energized by our first quarter performance. We delivered our highest book-to-burn ratio since becoming a public company, and ended the quarter with the largest backlog we've reported in more than two years.

Ural Yal: Overall, we are energized by our Q1 performance. We delivered our highest book-to-burn ratio since becoming a public company and ended the quarter with the largest backlog we've reported in more than 2 years. Just as importantly, we continue to make progress winding down non-core work, further improving backlog quality and positioning the business for more consistent execution and a sustainable growth. As we look ahead, we believe the momentum exiting the quarter provides a solid foundation for the remainder of the year. We look forward to updating you on our progress as we move forward in 2026. Operator, you may now open the line for questions.

Speaker #2: Just as importantly, we continue to make progress winding down non-core work, further improving backlog quality, and positioning the business for more consistent execution and a sustainable growth.

Speaker #2: As we look ahead, we believe the momentum exiting the quarter provides a solid foundation for the remainder of the year. We look forward to updating you on our progress as we move forward in 2026.

Speaker #2: Operator, you may now open the line for questions.

Operator: To our question and answer session. At this time, if you would like to ask a question, please click on the Raise Hand button, which can be found on the black bar at the bottom of your screen. You may remove yourself from the queue at any time by lowering your hand. When it is your turn, you will receive a message on your screen asking to be promoted to a panelist. Please accept, wait a moment, and once you've been promoted, you will hear your name called, and you may unmute your video and audio to ask your question. We'll now pause a moment to allow the queue to assemble. Our first question will come from Aaron Spychalla with Craig-Hallum. Your line is open. Please unmute your audio and video and ask your question.

Speaker #3: For the question-and-answer session: At this time, if you would like to ask a question, please click on the Raise Hand button, which can be found on the black bar at the bottom of your screen.

Speaker #3: You may remove yourself from the queue at any time by lowering your hand. When it is your turn, you will receive a message on your screen asking to be promoted to a panelist.

Speaker #3: Please accept, wait a moment, and once you've been promoted, you will hear your name called. You may unmute your video and audio to ask your question.

Speaker #3: We'll now pause a moment to allow the queue to assemble. Our first question will come from Aaron Sapala with Craig Hallam. Your line is open.

Speaker #3: Please unmute your audio and video and ask your question.

Speaker #4: Yeah, hi, Ural and Todd. Thanks for taking the questions. Hi. Maybe first, for me, just on Todd—you kind of just talked about it on backlog, but just wanted to kind of confirm: So, Chick Lock, out of backlog, and then for the guide, revenue and EBITDA, can you just kind of talk about the impact there?

Aaron Spychalla: Yeah. Hi, Ural and Todd. Thanks for taking the questions.

Ural Yal: Aaron.

Aaron Spychalla: Hi. Maybe first for me, just on, you know, Todd Yoder, you kind of just talked about it on backlog, but just wanted to kind of confirm. Chickamauga Lock, you know, out of backlog, and then for the guide, you know, revenue and EBITDA, can you just kind of talk about the impact there, you know, reiterating the guidance, any other financial impact? Sounds like you don't expect any impact on your ability to go out and win and bid on new work from that.

Speaker #4: Reiterating the guidance, any other financial impact? And then, it sounds like you don't expect any impact on your ability to go out and win and bid on new work from that?

Speaker #5: Yeah. Maybe I'll start and then turn it over to Todd. Thanks for the question. So yeah, generally, even though there's a reduction in revenue from Chick Lock, we believe we can—we believe we're going to hit the guidance on the revenue side.

Ural Yal: Maybe I'll start and then turn over to Todd. Thanks for the question. Generally, even though there's a reduction in revenue from Chickamauga Lock, we believe we can, we believe we're gonna hit the guidance on the revenue side. We may trend towards maybe a little bit on the lower side, but we think, based on the really strong backlog we got over this quarter and everything that we're planning to book, that's pending, we have a really good start to the year and we expect to see pretty significant revenue growth here the rest of the year.

Speaker #5: We may trend towards maybe a little bit on the lower side, but we think based on the really strong backlog we got over this quarter and everything that we're planning to book that's pending, we have a really good start to the year and we expect to see pretty significant revenue growth here the rest of the year.

Speaker #4: Yeah. I would just add to that, in '25, we burned in non-core just under 100 million. And we didn't expect to burn anywhere near that in '26.

Todd Yoder: Yeah. I would just add to that, you know, in 2025 we burned in non-core, just under $100 million, and we didn't expect it to burn anywhere near that in 2026. It's not as big of an impact as, when you're looking at it on a year-over-year basis. The second thing to Ural's point, with, you know, $289 million worth in new awards booked just in Q1, we have, we feel very confident that the numbers are achievable.

Speaker #4: So it's not as big of an impact as when you're looking on it on a year-over-year basis. And then the second thing to Ural's point with $289 million, new awards booked just in the first quarter, we have we feel very confident that the numbers are achievable.

Speaker #5: And going back to the ability to win work, we're bidding just like we have been; we don't expect any slowing down there. And like I said, we have some pending awards, but we're continuing to bid at about the same clip that we have been for the last six, eight months.

Ural Yal: Going back to the ability to win work, we're bidding just like we have been. We don't expect any slowing down there. Like I said, we have some pending awards, but we're continuing to bid at about the same clip that we have been for the last six, eight months.

Speaker #4: Good. Thanks for that. And then just on margins, good performance in the quarter. For the core business, can you just kind of talk about confidence there, margins that are in backlog, and what you're bidding, and then just any how you're kind of navigating impact from higher commodity costs in that as well?

Aaron Spychalla: Good. Thanks for that. Just on, you know, margins, good performance in the quarter for the core business. Can you just kind of talk about, you know, confidence there, you know, margins that are in backlog and what you're bidding and then just any, you know, how you're kind of navigating impact from higher commodity costs in that as well?

Speaker #5: Yeah. We're generally, as far as higher commodity costs new work we're bidding, that's all getting built into the pricing. So if we're going to win a project that's the inflation and supply chain issues will be built into the to our pricing.

Ural Yal: We're generally, as far as higher commodity costs, new work we're bidding, that's all getting built into the built into the pricing. If you're gonna win a project that's the inflation and supply chain issues will be built into our pricing. We don't expect any issues there. Same with fuel. We're managing the rest of it for the book of business that we have. I expect we're gonna continue to grow on the growth margin side and start to really get into those 12s and 13s as we get through and start really burning the work that we have won in 2025 since Todd and I have joined.

Speaker #5: So we don't expect any issues there. Same with fuel. And we're managing the rest of it for the book of business that we have.

Speaker #5: I expect we're going to continue to grow on the gross margin side. And start to really get into those 12s and the 13s as we get through and start really burning the work that we have won in 2025 since Todd and I joined.

Speaker #4: Yeah, and I would just add to that—when you're modeling it out with the non-core, we did have in backlog ending 2025, right? And that was a significant drag, even though there are loss projects with zero margin. There's always cost that occurs.

Todd Yoder: Yeah. I would just add to that, you know, when you're modeling it out with the non-core that we did have in backlog ending 2025, right? That was a significant drag on Even though there are lost projects with zero margin, there's always costs that occur to keep those projects operating. When you take that kind of drag off of it, you know, it may be a little lumpy as construction business is, right? An 11% trend on Shimmick work is very encouraging.

Speaker #4: To keep those projects operating. So when you take that kind of drag off of it, it may be a little lumpy as construction business is.

Speaker #4: Right? But an 11% print on Shimmick work is very encouraging. Yeah. Good. And that kind of just the last question you kind of started to touch on it there.

Aaron Spychalla: Yeah. Good. That kinda just the last question. You know, you kinda started to touch on it there. I mean, cash flow and the outlook there, sounds like there might be or might have been some drag on, you know, completing some of the legacy work. You know, kinda outlook for cash flows as some of these new projects ramp up to you.

Speaker #4: Just I mean, cash flow in the outlook there, sounds like there might be or might have been some drag on completing some of the legacy work.

Speaker #4: So just kind of outlook for cash flows as some of these new projects ramp up, too.

Speaker #5: Yeah, the less legacy work we have, the better for our cash flow. Generally, that has been the case. So, we expect improvement there as well, not only as we really just burn all of the legacy work, the non-core work, but also as these newer projects get online and start generating upfront cash to help with the cash flow.

Ural Yal: Yeah. The less legacy work we have, the better for our cash flow. Generally, that has been the case. We expect improvement there as well as not only as we really just burn all of the legacy work, non-core work, but also as these newer projects get online and start generating upfront cash to help with the cash flow. We're very optimistic about the rest of the year on that side as well.

Speaker #5: So we're very optimistic about the rest of the year on that side as well.

Speaker #4: Yeah. I would echo the very optimistic on liquidity. The rest of the business outside of the legacy projects, non-core projects, have generated cash and continue to generate cash.

Todd Yoder: Yeah. I would echo the very, very optimistic on liquidity. The rest of the business outside of the legacy projects, non-core projects, you know, have generated cash and continue to generate cash, so very optimistic.

Speaker #4: So very optimistic. Good. That's good to hear. Thanks for taking the questions. I'll turn it over. Thanks, Aaron.

Aaron Spychalla: Good. That's good to hear. Thanks for taking the questions. I'll turn it over.

Ural Yal: Thanks, Aaron.

Speaker #3: Your next question will come from Jerry Sweeney with Roth. Please unmute your audio, video, and ask your question.

Todd Yoder: Thanks, Aaron.

Operator: Your next question will come from Jerry Sweeney with Roth Capital. Please unmute your audio, video, and ask your question.

Jerry Sweeney: Good afternoon, Ural and Todd. Thanks for taking my call.

Speaker #6: Good afternoon, Ural and Todd. Thanks for taking my call.

Gerry Sweeney: Good afternoon, Ural and Todd. Thanks for taking my call.

Speaker #7: Hi, Jerry.

Ural Yal: Hi, Jerry.

Speaker #4: Hey, Jerry.

Todd Yoder: Hey, Jerry.

Jerry Sweeney: I wanted to talk about gross margins a little bit further. Obviously, I think you highlighted selectivity, I guess, your ability to be a little bit more selective with projects on a go-forward basis. I think you printed 11% for Shimmick projects this quarter. Those projects that you're seeing that are coming through today, when were they bid, and what were they bid at versus what you're bidding today?

Speaker #6: I wanted to talk about gross margins a little bit further. Obviously, I think you highlighted selectivity your ability to, I guess, be a little bit more selective with projects on a go-forward basis.

Gerry Sweeney: I wanted to talk about gross margins a little bit further. Obviously, I think you highlighted selectivity, I guess, your ability to be a little bit more selective with projects on a go-forward basis. I think you printed 11% for Shimmick projects this quarter. Those projects that you're seeing that are coming through today, when were they bid, and what were they bid at versus what you're bidding today?

Speaker #6: And I think you printed 11% for Shimmick projects this quarter. Those projects that you're seeing that are coming through today, when were they bid and what were they bid at versus what you're bidding today?

Ural Yal: Yeah, good question. You know, within the Shimmick portfolio, there are projects anywhere between 10% and 20%. As we get in a better position from a backlog perspective, we're able to be more selective with what we bid because we have the kind of the core backlog already in place. We're now in that position. We're gonna inch that up to about 2.5 times as far as, you know, backlog versus revenue. That's our goal as the rest of the year unfolds. Generally, having that kind of a strong backlog now allows us to bid at higher margins or pick the projects to bid that we can get at higher margins.

Speaker #5: Yeah. Good question. So within the Shimmick portfolio, there are projects anywhere between 10 and 20 percent. But as we get in a better position from a backlog perspective, we're able to be more selective with what we bid because we have the kind of the core backlog already in place.

Speaker #5: We're now in that position. We're going to inch that up to about two and a half times as far as revenue backlog versus revenue.

Speaker #5: So that's our goal as the rest of the year unfolds. But generally, having that kind of a strong backlog now allows us to bid at higher margins, or pick the projects to bid that we can get at higher margins.

Speaker #5: So I expect that to continue to that 11% to continue to go up from here.

Ural Yal: I expect that 11% to continue to go up from here.

Jerry Sweeney: With over $900 million in backlog, you're starting to book business into 2027 and later, correct?

Speaker #6: And over 900 million in backlog, you're starting to book business into '27 and later, correct?

Gerry Sweeney: With over $900 million in backlog, you're starting to book business into 2027 and later, correct?

Speaker #5: Yeah. Our average job is about two and a half years. So we have a year-long job. We have four-year jobs. But if you average it out, it's about two and a half years.

Ural Yal: Yeah. Our average job is about two and a half years. We have year-long jobs, we have 4-year jobs, but if you average it out, it's about two and a half years. We're setting ourselves up really well for 2027, and some of it into 2028. Yeah.

Speaker #5: So we're setting ourselves up really well for '27, and some of it into 2028. Yeah.

Speaker #6: Got it. And then switching gears to data centers, everybody's talking about data centers. And obviously, you rebranded Axia. But the way we sort of been dissecting the data center work is it probably takes between two and three years between you say, "Hey, I want to build a data center," to site selection, permitting, to maybe shuttles hitting the ground.

Jerry Sweeney: Got it. Then switching gears to data centers. Everybody's talking about data centers. Obviously you rebranded Axia. The way we sort of been dissecting the data center work is, it probably takes between 2 and 3 years between say, "Hey, wanna build a data center?" to site selection, permitting, to maybe shovels hitting the ground. We're starting to see a lot of dollars come through on some front-end D&C companies on the concrete side. Arguably, the electrical's a little bit further along in that curve, right? I know you're going after data centers, but what I'm trying to say is, as that business is starting to accelerate and you're getting into that business, there's probably a dearth of probably qualified electricians.

Gerry Sweeney: Got it. Then switching gears to data centers. Everybody's talking about data centers. Obviously you rebranded Axia. The way we sort of been dissecting the data center work is, it probably takes between 2 and 3 years between say, "Hey, wanna build a data center?" to site selection, permitting, to maybe shovels hitting the ground. We're starting to see a lot of dollars come through on some front-end D&C companies on the concrete side. Arguably, the electrical's a little bit further along in that curve, right? I know you're going after data centers, but what I'm trying to say is, as that business is starting to accelerate and you're getting into that business, there's probably a dearth of probably qualified electricians.

Speaker #6: And we're starting to see a lot of dollars come through on some front-end E&C companies on the concrete side. Arguably, the electrical is a little bit further along in that curve, right?

Speaker #6: And I know you're going after data centers, but what I'm trying to say is as that business starts to accelerate, and you're getting into that business, there's probably a dearth of probably qualified electricians.

Speaker #6: So, we should start to see more and more opportunities on the electrical side for you as we move through this year into next year.

Jerry Sweeney: We should start to see more and more opportunities on the electrical side for you as we move through this year into next year. Is that a fair assumption?

Gerry Sweeney: We should start to see more and more opportunities on the electrical side for you as we move through this year into next year. Is that a fair assumption?

Speaker #6: Is that a fair assumption?

Speaker #5: That's a fair assumption. And also, I would say the types of work that we're bidding within the data center world is in the mechanical and the electrical side.

Ural Yal: That's a fair assumption. I would say the types of work that we're bidding within the data center world is in the mechanical and the electrical side. We're not really bidding a lot of the kind of the earthwork concrete pieces of it. This type of work fits us better. Water treatment, water purification, electrical data center, the racks, the switch gear, the medium voltage, and then even the power generation side. We have a lot of opportunity there that both fits the Axia brand, the electrical brand business, as well as the Core Shimmick business as well from a water treatment process, mechanical piece.

Speaker #5: So we're not really doing a lot of the bidding a lot of the kind of the earthwork, concrete pieces of it that fits this type of work, fits us better.

Speaker #5: So, water treatment, water purification, electrical, data center, the racks, the switchgear, the medium voltage, and even the power generation side. So we have a lot of opportunity there that both fits the Axia brand, the electrical brand.

Speaker #5: Business as well as the core Shimmick business as well, from a water treatment process, mechanical piece.

Speaker #6: Got it. Yeah. I was just using concrete as that's sort of the first step in your after that.

Jerry Sweeney: Got it. I was just using concrete as like that's one of the first step in your answer then.

Gerry Sweeney: Got it. I was just using concrete as like that's one of the first step in your answer then.

Speaker #5: Yeah. Exactly.

Ural Yal: Yeah, exactly.

Speaker #6: How at what point would a data center or I assume you're working with the data centers would be other E&C companies, but how much visibility do you have between bidding and maybe the start of the jobs that are related to the data center?

Jerry Sweeney: At what point would a data center or I assume you're working with the data centers would be other EPC companies. How much visibility do you have between bidding and maybe the start of the jobs that are related to the data center?

Gerry Sweeney: At what point would a data center or I assume you're working with the data centers would be other EPC companies. How much visibility do you have between bidding and maybe the start of the jobs that are related to the data center?

Ural Yal: Again, it's not that different from our public works projects. We bid it, and then over the next few months after that, we will know if we, if we won it or not. We're bidding actively right now. I mean, I think one of the good news is a lot of these data centers are really shifting towards Texas, which is where we're growing as well. That has brought in a lot more opportunity. On the West Coast, it's Reno that's kind of the work centered in Reno, which also is a great, easy place for us to work. We're in the right place right now.

Speaker #5: It's usually, again, it's not that different from our public works projects. So we bid it, and then over the next few months after that, we have a we will know if we want it or not.

Speaker #5: So we're bidding actively right now. And I mean, I think one of the good news is a lot of these data centers are really shifting towards Texas, which is where we're growing as well.

Speaker #5: So that has brought in a lot more opportunity. And then on the West Coast, it's Reno. That's kind of the work center that Reno, which also is a great, easy place for us to work.

Speaker #5: So we're in the right place right now.

Speaker #6: Gotcha. One last question. I know the legacy work was only 200,000, and there were some of the Chickamauga negotiations with the Army Corps. How much if that had not occurred, I'm just curious, how much sort of revenue from Chickamauga would have come through?

Jerry Sweeney: Gotcha. One last question. I know the legacy work was only $200,000, and there was some of the Chickamauga negotiations with the Army Corps. How much if that had not occurred, I'm just curious, you know, how much sort of revenue from Chickamauga would have come through? Yeah, the $88 million in revenue, you had a weather hit, and you had Chickamauga. Just trying to levelize what happened in Q1 as well, if that makes sense.

Gerry Sweeney: Gotcha. One last question. I know the legacy work was only $200,000, and there was some of the Chickamauga negotiations with the Army Corps. How much if that had not occurred, I'm just curious, you know, how much sort of revenue from Chickamauga would have come through? Yeah, the $88 million in revenue, you had a weather hit, and you had Chickamauga. Just trying to levelize what happened in Q1 as well, if that makes sense.

Speaker #6: Because, yeah, the $88 million revenue, you had a weather hit, and you had Chickamauga. Just trying to levelize what happened in Q1 as well, if that makes sense.

Speaker #5: Somewhere around 20 and 30 million this year.

Ural Yal: Somewhere around $20 and 30 million this year.

Speaker #6: Okay. All right.

Jerry Sweeney: Okay. Yeah.

Gerry Sweeney: Okay. Yeah.

Speaker #5: Yeah.

Speaker #6: Yeah.

Ural Yal: Yeah.

Jerry Sweeney: Yeah.

Gerry Sweeney: Yeah.

Speaker #5: So yeah, it went down more than half.

Ural Yal: Yeah, it went down more than half.

Speaker #6: Okay. And like we said, I mean, at the end of the day, this helps your margin profile, helps your cash flow. And it's going to go through the standard federal process, correct?

Jerry Sweeney: Okay. Like we said, I mean, at the end of the day, this helps your margin profile, it helps your cash flow, and it's gonna go through the, you know, the standard federal process, correct?

Gerry Sweeney: Okay. Like we said, I mean, at the end of the day, this helps your margin profile, it helps your cash flow, and it's gonna go through the, you know, the standard federal process, correct?

Speaker #5: Yeah. Yeah. Obviously, it's a yeah. It's an established process there. And we're working we're confident we're going to get to an amicable solution. It takes a while with the federal process.

Ural Yal: Yeah. Yeah. Obviously, it's, Yeah. It's, there's a established process there, and we're confident we're gonna get to an amicable solution. It takes a while with the federal process, but in the meantime, everything you said about backlog and cash and everything else is very accurate.

Speaker #5: But in the meantime, everything you said about backlog and cash and everything else is very accurate.

Speaker #6: And that's a legacy from like 2017 or 2018. It's I think it started in 2004 originally, but not with you.

Jerry Sweeney: That's a legacy from, like, 2017 or 2018. I think it started in 2004 originally, but not with you.

Gerry Sweeney: That's a legacy from, like, 2017 or 2018. I think it started in 2004 originally, but not with you.

Speaker #5: Yeah. We bid that project in 2017, pre-COVID, a long time ago. Along with a couple of these legacy projects. So we're looking forward to really getting them done and moving forward new work.

Ural Yal: Yeah. We bid that project in 2017, pre-COVID, you know, long time ago, along with a couple others of these legacy projects. We're looking forward to really getting them done and moving forward with new work.

Speaker #6: Okay. Great. All right. Congratulations. Very nice quarter on the margins. And I understand the weather, so. Thanks for your time. And talk to you in a little bit.

Jerry Sweeney: Okay, great. Congratulations. You know, very nice quarter on the margins, and I understand the weather. Thanks for your time, and talk to you in a little bit.

Gerry Sweeney: Okay, great. Congratulations. You know, very nice quarter on the margins, and I understand the weather. Thanks for your time, and talk to you in a little bit.

Ural Yal: Thank you.

Speaker #6: Thank you.

Operator: There are no further questions at this time. I'd now like to turn the call over to Ural for closing remarks.

Speaker #1: There are no further questions at this time. I'd now like to turn the call over to Ural for closing remarks.

Ural Yal: We've had another strong quarter, aligned with our expectations and the strategy that we put in place back in 2025. A lot of the backlog and our margins, gross margins are reflecting that. We're still in the early phases of our growth, but we expect the rest of the year to continue to improve and have a very strong year, looking forward to the next quarter. Thank you.

Speaker #5: We've had another strong quarter. Aligned with our expectations in the strategy that we put in place back in 2025. And a lot of the backlog and our margins gross margins are reflecting that.

Speaker #5: We're still in the early phases of our growth. But we expect the rest of the year to be to continue to improve. And have a very strong year.