Q1 2024 L B Foster Co Earnings Call Transcript
Key Points
- First quarter organic sales improved by 16.9% over the prior year, driven by a strong performance in the Rail segment which saw a 29.4% increase.
- Adjusted EBITDA increased by 32.4% year over year, supported by a 90 basis point gross margin improvement, ending at 21.1%.
- Net debt decreased by $2.5 million compared to last year, and the gross leverage ratio improved from 2.2 times to 2 times year over year.
- Order rates recovered in the first quarter, increasing by 25.5% sequentially and 3% over the last year on an organic basis.
- The company reaffirmed its 2024 financial guidance, indicating confidence in achieving its 2025 financial goals.
- Infrastructure results were softer in the quarter, with organic sales remaining flat year-over-year, impacted by challenging weather conditions.
- Backlog decreased by $37.6 million versus last year, primarily due to strategic divestitures and improved order fulfillment lead times in the Rail distribution business.
- Cash used for operating activities in the quarter was $21.9 million, driven by seasonal working capital needs and funding for prior incentives and annual insurance premiums.
- Selling, general, and administrative costs increased over the prior year due to personnel and professional services costs.
- The Infrastructure Solutions segment revenue decreased by 18.4%, with a significant part of the decline due to divestiture and product line exit activities.
Good day and thank you for standing by. Welcome to the Q1 2024 L.B. Foster earnings conference call. (Operator Instructions). Please be advised that today's conference is being recorded.
I would now like to turn the conference over to your speaker for today, Stephanie Schmidt. Please go ahead.
Thank you, operator. Good morning, everyone, and welcome to L.B. Foster's first quarter of 2024 earnings call. My name is Stephanie Schmidt, the company's Investor Relations Manager. Our President and CEO, John Kasel; and our Chief Financial Officer, Bill Thalman, who will be presenting our first quarter operating results, market outlook and business developments this morning.
We'll start the call with John providing his perspective on the company's first quarter performance. Bill will then review the company's first quarter financial results. John will provide perspective on market developments and company outlook in his closing comments. We will then open the session up for questions.
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