Arcosa (ACA) 2 Nov 232023 Q3 Earnings call transcript

Good morning, ladies and gentlemen, and welcome to the Arcosa, Inc.

Third Quarter 2023 Earnings Conference Call. My name is Shelby, and I will be your conference call coordinator today.

As a reminder, today's call is being recorded.

Now I would like to turn the call over to your host, Erin Drabek, Director of Investor Relations for Arcosa. Ms. begin. may you Drabek,

session accessing and presentation Call. for will Antonio the With and posted Relations webcast release A and everyone, copy prepared Quarter yesterday's ir.arcosa.com. on X this of number replay weeks. A be call available Carrillo, tab. under Arcosa's morning's website website, today's XXXX CEO; X press A for on question-and-answer CFO. News Investor Peck, year in our Earnings me Instructions will included the Gail and follow thank of for replay are morning, release. their for joining the remarks. A Events next slide you and the Third President will replay our the for Good be today press are are available the of call

financial comments appendix financial of that measures have slides not to Reconciliations are measures in presentation the measure Today's prepared GAAP. presentation. non-GAAP accordance the GAAP slide included and with contain in been of closest the

In contains Securities forward-looking Private defined the of by Act Reform Litigation call today's conference statements as addition, XXXX.

now statements. information are expected refer SEC uncertainties, and be Antonio. subject to forward-looking could to the to XX-Q release and that the actual like to including would to on turn filed we more these statements press differ risks from filings Form the such uncertainties for results company's materially call later over yesterday, our Forward-looking cause risks Please and to today. I filed

of turn Page Erin. discuss the us and outlook to our Please Good third for to remainder results you, morning. the joining Thank quarter for X. you Thank XXXX.

of storage business. for and the revenue Arcosa generated tank in double-digit adjusted the divestiture EBITDA growth normalizing

the improve. Starting September, Construction our results drove for in enhancing pleased increased our we We business leverage natural stabilized Construction made on in producer, on a and volumes the and in aggregates the announce progress with that acquired underscore for closed enhanced volumes Products. X% plan businesses margins cyclical diversified recently North financial Products. In growth. adjusted operating portfolio to as am pricing Strong we recovery sequentially. of presence fast-growing production acquisitions improvement solid and market. Our Houston in materials specialty our sand our I bolt-on the resilience three EBITDA

we recycled Following two quarter producers, in market. end, the our and acquired Florida expanding entering presence aggregate Phoenix recycled

has Our investment six of an Tampa. at multiple Central Florida locations, from in million EBITDA. attractive $XX newly of Florida businesses acquired Orlando these predominantly in an three acquisitions approximately Combined, to Xx roughly represent

pipeline attractive bolt-on an have additional of to opportunities. continue We

revenue our profitability Structures Segment below increased. was expectations. Engineered While

was to mix, impacted impact. utility as including a Our orders structures business shift by XXXX were high-margin certain delayed unfavorable an foreign production as several well headwinds, currency that in

experienced processes higher operational challenges, outsourcing required we including costs. downtime, Additionally, at of some which equipment the

improvement we actions began quarter, the margin During initial that the implementing month enabled in of September. correcting

performed On the be of EBITDA benefit in wind the relatively in volume on even growth and driving focus efficiencies, our compares positive side, our our for barge This EBITDA quarter profitable XXXX. Transportation low. expectation wind basis net earlier business performance for steel both With tax favorably considering the components. and an breakeven volume pricing third year well continued production strong business credits. generated anticipate on will operational our we remained the before by driven Products forecast results, for with as

And year-to-date a performance. our was into on am XXXX. In solid nearly quarter modest, the our be doubled year-over-year continue visibility during with intake order barge healthy. summary, pleased basis, financial well providing production backlog inquiries I to the While

businesses the We to positioned fundamentals in advance organic expected have market next priorities, our our the and expanding strategic through on At we've year. same cyclical continued growth capitalize our improvement to both M&A businesses time, projects.

detail providing results on flexibility sheet I outlook. Finally, liquidity for balance quarter, will now return the remains strong, updated discuss provide our to Gail? and capital our financial will position our for and allocation. Gail

third across Starting in businesses, discuss recovery I'll volume growth contribution as and Slide was to XX construction segment natural natural X% quarter acquisition-related segment increased trench specialty pricing by lower in on shoring. Adjusted offset well strong results. segment pricing and and organic EBITDA our higher margin volumes you, with a margins begin inflationary by Freight-adjusted aggregates increased EBITDA were aggregates gains cost in materials. Construction in aggregates margin Thank as materials Antonio. year-over-year, our and as X%, Products, driven reduced specialty recycled and flat, reflecting pressures. higher revenues

up region. our pricing by Turning high to markets single across natural strong a remains average on basis, with Pricing digits organic led freight-adjusted West aggregates. momentum our

margin aggregates and in Texas natural costs, in Ohio Valley Coast Pricing our year-over-year by modest by single and driven Gulf driving despite for decline up pricing digits, lines. product West quarter volumes demand growth the [ regions, and resulted year-over-year high and our solid in overall volume. particularly River increased industrial healthy, ]. Within inflationary in was materials, continued strong our third diesel, we focus for particularly Third plaster these aggregates. offset recycled regions. Favorable and value expansion. lightweight in were declines aggregates, to lower significantly In gains for over expansion specialty volumes remained partially flooring a on by quarter, Pricing margin

constrained. from backlogs supply remains peak have are While markets, in customers' receded some strong and our plaster multifamily starts

second quarter as improvement focused significantly margin from year-over-year, business. remain on driving made We improvement increased quarter but and our margins throughput. the in this Third improved continued progress operational decreased plan we on

year. and supportive remain revenues grew that in higher on contribution backlog Finally, expanded our of levels as our as the Houston volumes earlier slightly acquisition XX% and business shoring the also well XXXX. growth in inquiry in organic Margins trench closed from

X% year-over-year, storage margins Engineered Slide Adjusted EBITDA XXX points and XX. the Structures on to segment declined Moving for lower tanks divestiture. were basis normalizing

substituted structures performed led utility by business business solid our impact tax our wind million were pushed than from impacted which bid tower $X.X Several growth. XXXX double-digit into expense below volumes. Results well volume in the although mix shift AMP work. From resulted quarter. unit additional projects at inefficiencies. pace, equipment an and production certain There profitability and anticipated a and locations during Our was grew standpoint, more downtime operational lower strong factors of offset net benefited margin with were wind several a as expectations, higher-margin from at credits, towers for in the were product lower revenues as segment

efficiencies. a the we prior dollar overcame XX% more was Lastly, to our of operations compared and in Mexico. negative manufacturing the relative than stronger operating the year effects currency to peso third began peso up levels. quarters, in impacted appreciating the profitability In The earlier quarter ago year in through

the with with $X.X for backlog and wind, line quarter quarter combined approximately utility with in activity Turning second related of utility, order structures structures to ended as shipments. pace our backlog. kept and billion, We the

more Moving margin, businesses. and reaching Transportation XX%, EBITDA Segment accretive Adjusted XX. were segment our reflecting significant steel Products growth a tripled high. and to was both with up by leverage driven Slide in the operating margins significant components revenues to X-year improved our barge on consolidated than volume businesses. pricing in improvement This these

orders deliver barge XX% the We hopper $XX ended received X.X. of of total representing during million, book-to-bill backlog with a expect which of approximately barges, We for to quarter we predominantly $XXX barge XXXX. of million,

the use and working sheet a our some $XX by collection capital due in cash moderation I'll quarter, We and We cash driven of in that was receivables. be on our volumes increase flow of in generated anticipate for capital, conclude working of the will position. needs to Slide year-over-year high quarter, on comments which balance million XX flow million fourth operating full overall $XX primarily with working timing but down of a capital year. the a during is cash the expectation

As million to during of capital Structures, in underway $XX the projects were year-over-year. $XX continue Products make organic and quarter, the an we Engineered expenditures million progress on net Construction increase

to our $XXX Third quarter remaining, net CapEx flow of EBITDA liquidity ended cash $XXX and $XXX million. of we to year We with tightened million. have one the million. With million Xx quarter was to quarter debt adjusted available full free range $X

XXXX During our credit we and to extend financial quarter, facility revolver million the million $XXX full covenants to in repay to our Pricing $XXX $XXX and loan. unchanged. increase amended maturity million, remained our term the date from

sheet over capital balance on Antonio to disciplined back Our to and ample outlook. pursue call now update our will to continue healthy flexibility allocation. I liquidity an for the turn provide

you, perform Gail. is XXXX. on and EBITDA adjusted Arcosa to revenue both well in to and continues for growth Thank track generate double-digit

Please turn to XX. Slide

for review portfolio remained Products, levels, million, pending forecast industrial ranges, $XX wind-related Given XXXX a year-over-year our Slide credits normalizing divestitures. Consistent $XX guidance. our In we in heavy assumes growth healthy the our nonresidential adjusted guidance performance confident XX% forecast visibility growth and our prior midpoint of growth for adjusted turn Construction we our accelerating businesses. we basis, federal in solid and year-to-date demand into the to fourth the has and Public clarification between and adjusted multifamily, and is outlook EBITDA are with storage to our net tanks across revenue and guidance, are XX local IRS. Please million activity XX% the at on and tax our estimated our both final EBITDA At of the revenue construction from seeing the strong. quarter, EBITDA pricing XXXX construction.

towards Utilities major near-term are rates. In positive, Although an initiatives, grid-hardening fundamentals volume allocate renewable clear, recent in infrastructure continue market connects Engineered stabilized single-family significant outlook market is has this Structures, for as months, the the mortgage sources CapEx given residential in to grid. drivers higher specific less that intact. remain to growth

traffic road view. Overall, infrastructure order CapEx order positive XG reinforcing softness backlog we demand of to have carriers remains our spending due activity our fuel structures and to continues for significant reducing seen In visibility investment. strong, pending levels following telecom, addition, products. In

signs As our already are margins improvement increase I on of executing and to mentioned progress. are plan seeing we the early before,

to We operating expect some XXX% will though be at the fourth quarter, margins even not improve equipment capacity. in

this production expected to our enter Aided businesses, wind turn footprint incentives multiyear up In preparations XX. Let's the capacity. Reduction necessary the making by from now on industry to across is Inflation starting environment, to a we're optimize our cycle. Slide Act, cyclical

brownfield we're Mexico, modifications. plant staffing personnel key and Our facility New new building in on working

starting from will facility Our expectation deliver remains this that we mid-XXXX. in towers

these making incremental our In we further our enhance to and addition efficiency investments existing manufacturing are across to efforts, flexibility. plants

quarter, from for towers, two expected with a small customer to a order During qualification the delivery new XXXX. late third were we pleased receive

remain XXXX. We in with beyond our for which continue customers We the tower outlook have with to projects onshore growth conversations wind market. the the serves confident only additional for deliveries business, productive

time $X.X complex strengthen billion, for supports expectation While about to order backlog negotiate fulfillment and next volumes our year. increased production our of is and requires profitability

to XX. Turning Slide

strengthening Our third was growing our XX% up production the in on at quarter, barge and stages segment still in the the underscoring Barge well XXXX. of the year-over-year upturn. the into a a the with quarter for early visibility backlog Transportation cyclical performed of Products business our end demand barges basis,

the While strong and rates, be XXXX. In on system, business, strengthening our pricing we maintain and our continued businesses, our have remain midterm some taken the into portfolio. customers focused for Mississippi the actions execution Unusually purchasing healthy confident We're our many closing, this which have demand while capabilities our for the of our reflective customer quarter XXXX, quarter. in do outlook. schedule We for believe fourth across deliver growth we in and our sentiment. low the to cyclical environment, recently weighted is In have environment. in visibility temporary delayed higher significantly and of on manufacturing should interest water not and these remain on with growth fundamental positioned growth to in levels improved opportunities outlook cost visibility this we River benefit well in our shift concerns confident continue demand on We are into the to flexibility, strategy decisions. production the businesses the our for from

team forget I of work. call I period public as the hard short Yesterday anniversary company fifth has it a easy is changed was to in Arcosa company, Before want questions, our just how all open much recognize and to an their independent time. the to for this

want also we Arcosa suppliers come a best X for investors long and all thank to years. and yet to is support have that way, the the We during stakeholders, these customers, our confidence employees, come. I convinced their

I Now to like open call would the for questions.

first question with our And Capital. Instructions] take we'll Shmois Loop Garik from [Operator

off, Construction was wondering, I Products. first just on

by just You you end But you anticipated, volume you driving the little bit is growth, some what detail we geographic said some of a volume had which had mix. than could there is stronger that gains? favorable seeing if maybe And recognizing was were wondering some markets? more

Sure. is Gail. Garik, we take Yes, this were I'll that. pleased.

volume increase up were my digits. That's the in a aggregates seen really natural mentioned volumes about we've for we year. high As comments, first single in

your Texas. the looking were So markets, in up question, to at the volumes

flat in volumes recall, we quarter. said you the second If were

in Non-res new the there. doing of is positive seeing resi South well. the lettings So continuation And neighborhoods area. some We're Certainly, positives and in some DFW seeing okay. state. North

did LNG Ohio well. helping they were but in is as work the There's Valley So our down, we up had did refinery that slightly. see that. a down also good by encouraged the is also the healthy. that and the in They in were year in gravel Texas well. have we availability we were mentioned, was a Gulf healthy. greenfield is quarter had last volumes. Where as project performing We we And region, West, volumes have in stabilized new up. Gulf down we the second limited work volumes volumes DOT didn't in I Coast in Houston. In River that's

volumes sequentially. see did we up So

encouraged. early. we're So It's

in As we're the from we're perspective. encouraged seeing what I it's year, said, a first with the volume but quarter

creates mention it U.S., we think experienced also country. And One hot absenteeism our thing and but was specifically, significant amount had it even heat when the disruptions in turnover Texas base in told we the a increased, all significant increased. my portfolio a I'd from throughout like that slowed in across lot. a to that across have here plants, our the a impacts construction remarks, the in portfolio, that quarter sorts of of I we And during

-- I but is we this number don't think related quarter, quite think of weather. give I to quarter for third saw just the had to that I you and So an impact a have during -- this

Yes. our and the more in recycled area just Worth color. even did down a we more to in business. on side, see saw pronounced recycled And aggregates that add maybe quarter. to weather little volumes bit the that We The in Dallas-Fort probably

Florida. ask, you that a wanted I opportunistic think be and recognizing entrance on anything? that opportunity a you? a on than is announced, could this for of to just small, relatively had Do that actually but the acquisitions -- just more into interested Understood. acquisition wondering the one-off they're particularly platform new an you Or bit

a small a in with that our few came acquisition StonePoint years already We operation Florida had ago.

we We just we pipeline more really that enter But a seeing of our So it's local in side. a are do recycled interested. once we that into from like. especially -- companies a not There's market consolidation, we the calls market, lot get start see small increase. simply

opportunities So interested in is develop. that we a it we platform to want have And in. It's a the pipeline. market additional really already in we're

me. question Last it. Got for

structures. Just on probably was driving recognizing when XXXX more and what and ships, the the volume story? timing to project potentially it's the of a that delays as utility Any visibility of

strong. hot. say Yes. as mean very tell you you, this say very, I'll industry I only see wouldn't would will it's -- I utilities. I is demand the is The

them. though the collar layoffs like When ground, now you well, is the been in labor noise a we're with shortage jobs. reality there like even announced Just projects has not where people start a seeing more reality projects there's and say, there's things around face towers, happening of that and and get wind force, lot of that. The sometimes blue hitting

taking So tower there's -- is farms, it's permitting get for power things hard these transmission still all to wind time. for for people

to going line. be about So is this growth a think our the not would way -- I straight

as going this we we bottlenecks think get ups to -- be breaking to I grow. see we have and that through we're these as downs go

happening. that's the me, is deal to biggest -- -- biggest that issue So the

Trey we'll from Stephens. Grooms our next And with take question

Pricing the Products is us generally, market It the there for Is your you're about has kind be Products the side I guess how Construction could any pricing. that that of sticking the year sounds strong. another good been give on in on pricing on of I with outlook wanted you 'XX outlook here. color like business? to Construction touch thinking could

to our I think peers competitors and is what -- trying similar our were The to we do. you from hear what

I right think now. increases we out pricing have

pricing January. another try to pricing increase volume. to going We have for and continue pricing over We're prioritizing pushing

great. that's get And to natural people still though back we're the up a under on well, margins. gas And can and areas inflation going again, bit. to completely not but We focus maximizing be even going some we be say, to our trying inflation is down, the will see both, little where yes, But picking -- is control.

we So to to pricing. continue push have our

And sounds elevated going Yes. Yes. that's I'll guess you specialty costs, be a right. mentioned it I speaking materials. better, there. stop costs of still just factor but And is That All that makes kind forward? going sense. a And getting little to I of bit on be like guess in

Yes.

more we really, there, say I materials. quarter for there the the second issues had a would materials, really would and in the second -- more That's industrial throughput and is it's things say but look more factor. When plans cost but of improving. And specialty bad Lots other a you factors for a specialty lot plants. specialty mentioned in materials maintenance had a quarter, much their of So -- during and complex -- that we factor some quarter. -- turnover came we absenteeism are I at second

able keep more. were are people -- We our much we to

in the improvement we materials, Our mentioned, had significant third improving of terms improvement a in plans quite a are in Gail quarter. pretty specialty bit, significant

But quarter September, So I it was cetera. the than second. better sequentially, the et It that throughout August, third trend pleased. And September was in not only to the well. August and third trend was better the continues than very was look the

is product happy doing, important very very, the is pretty here piece but the the for there the is with I'm demand team So that what strong.

plan to drive in really our hands this that it's have. improvement to continue we So

everything And continue is to the team. and a and great there margins our to be are take improve accretive margins it to for become a that us is ready demand back to have there there, business can and We margins.

Yes. Right.

on I'm touched transportation sorry it, I again. Okay. And side. come touched But sorry for know you on to detail you on just so bit then -- the -- little more a back to this. if but it

You low called out river levels.

I you 'XX are orders are But business in look just thinking as do where in that kind about we think about cycle. how the orders impacted given thinking of you little of of How we kind kind directionally? bit. a

Yes.

mean, months it's Let seasonally, normal look me of low the levels. for statistically, I couple you been this But you a first about historically. When talk very, last if to the at very river season look happen. have

couple and we've rain quite So since a received of weeks, bit. up a are levels coming

So I year it think we early to expect don't going the an or be forward issue XXXX. in

happens, in more So that other our than characterize as businesses, this -- would more I when cyclical volatile move in but the customers businesses.

things things pessimistic. go go will a quarter, optimistic. all get you great, by when you in get When all So

important So to sentiment replacement be margins The business. as to go the become it's positive I need aspect, of a the we the is replaced. we that -- market will it is expect -- demand back to the The customer there. is better fundamentals there,

have XXXX. We into good a backlog

say, of to let's significant I sales And that our a portion my have to customers on secured. but capacity. our want -- give We with away already, allows work timing, on us don't

-- our going our work we margins. So want customers And focus time cetera. to getting orders, to have et to with new we on on we're

better there, and XXXX we're is to I'm year. the and be demand to that So the orders get have is to that we going fill confident a time. going

next our from we'll D.A. question Thielman Brent Davidson. with And take

sounded it in Great. the how but issue, some mean facilities little it think does Structures be? in XXXX? the segment? there I maybe system, into Antonio, inefficiencies was take how to mix issues where of different that, then want Engineered more a could speak to any guess, a we business long through you the you I maybe like you the for to And we about is them profile do the margin as work get the move

Yes.

for one the me year. So let been has with cooking start that

when the our was dollar have XX. translate you below cetera of in you grew And Gail at it everything, dollars maintenance, pesos, now year a per two at in in XX dollar. XX, expenses, it's are when the her during -- depreciation, script, MXN -- salaries, ago mentioned the biggest into As But and manufacturing Mexico. quarter, plants and et it

So it significantly. pretty appreciated

lifetime look historically happened. Mexico, look that's -- you a If it And happens, and if once that's from but thing historically, you okay. that in

hitting we So been orders, to but talk really about not us, throughout able the through year, it. efficiencies good margin and it has have even been

to If because you haven't we overcome remember able we our even talked about call, it have it. been

that have that This was it mean, appreciated peso mentioned. issues except different, quarter, I I these we more. And operational no the

have and outsource facilities in forced few that larger moved to orders equipment And that down us several XXXX. pieces. We into go also a the outside margin

a bit, in fourth mentioned expect ready the to the for ramp mentioned have my little up as I in also, as help. should remarks, margins improve some been we I has that facilities we the shut As quarter But I our equipment, quarter. that not our down -- fourth peso have and all equipment improved will we

into So margin say, the improvement. And improvement margins. over the and we bigger return to be, margin we normalized reduce then margin see should into should the more the orders, let's we get orders as should 'XX, smaller time,

of So some the this -- is so problem was self-inflicted. --

orders the margin potential, the to But have profile for the learn We margin I outside. and there, have business think we the things not lesson, change. do to some should

climate can outside tied I of the for that talk What that like demand guess, outside large does then a perspective? about seeing investment? is the And you it to look you're wind, of the order customer Okay. from demand Mexico New

not down by what's obvious, a so we Sure. think in And sit going it not thing. I wind. they complex this, when and involved to people good about sometimes, I'm to Offshore in because very a participating it's wind and ask but that's environment, we saying reiterate And me offshore are offshore want I the with start wind. were I --

wind, So wind. in onshore things we onshore are And only are different. in

larger take remember -- Reduction approved, credits. mentioned was Going my I The if back it expectation Inflation when would got X tax at you the the was Act permitting beginning facility. in. We XX all year, had no this down. and didn't beginning. was orders I X.X to the for it sometime had going industry our year, to things. We expect got we that start really those We're to And time, at starting thought new months we and kick it the these through of longer order to XX working years big be that for slowing ago, the industry in

We of XXXX and expect the completely still and start to through -- backlog bottlenecks the have our a two Having system. mid-XXXX, not to this credit work been go delivering in for towers in three we by of is plants. And other good are the in things for defined terms said to out permitting the so, starting has IRS. industry there

it's every get -- don't a to we So this be quarter, order. I be expect choppy. to big going

in set a we're my and bigger profile. go we I than few better grow order. aspect for that, margin shape remarks, said those no with The is And where what have to to quarters for to are in able think our materialize I production going get fundamental there we time 'XX be wait through 'XX XXXX. our a and good to beyond up orders is and suddenly orders we given big plants

along. then as ready should ramp 'XX to better and to should move we be we 'XX So up than continue be

you what we'll Are continue Okay. XXXX here quarter. Products, it I of seems to guess be given this particular, a business Construction that you've on the last seen more call in confident increase volume the natural inflection, that for business? aggregates sort in volumes to I just that can you one fact mean,

quarter. increase quarter. her in we this mentioned flattening an before, saw comment Gail volumes as the Well, We saw in second in

some than smaller our much as are We of company peers.

probably regional more more our some them than net So a that have businesses and in wider more have of diversification. -- we volatility geographic

us we being We great volumes the What geographies. still But in means have probably areas. help bill in lot demand fundamentals. housing are great good there's in reduction and think and should also we a kicking infrastructure that in of start in very And should is geographies other compensate by uncertainty.

are We manufacturing our heavy throughout the country seeing builds in regions.

some as is everything of factors some I strong. the are not So think strong, for set be demand to up

a we lot in think have I pricing. of our confidence

back you let's pricing I is go can improvements, wind are on that tell increasing we So a XXXX to volume your a, say, that some able volume us and our towers. also with for question help our pricing will what to margins. I'm get be going positive confident continue mix to

to small other order I because, as mentioned It's The for thing many know, two forgot Arcosa -- we a important a customers. have received step industry We many, for mention. that we're very doesn't the towers. you

presence large So the U.S., that's important with a in get having another to able customer new orders a source and customer be future. the a heavy to it's us for qualify large of in

So I'm excited about that.

next our We'll Romero take from & Instructions] [Operator question Sidoti Julio with Company.

at to higher affected asked general portfolio? the across units This most and For On macro, economic earlier. business Julio. the thinking uncertainty is of impact Alex interest which can the about I'm a something are Hantman speak broader on you just on the for My expanding first moment. resilience is little example, question rates versus

one rates I of of to continue the important This I where moderator a is be say to housing has our And then any that think, biggest it's mortgage one. is demand. -- if you of buy an leverage, have has things, would Antonio. impact, course, to that customers borrow

at, So very The look strong. the pretty probably I have I and But is is demand are but is insulated. towers, for -- mean, if same would leverage are one they you wind course, things of utility example, the everything, I towers of they, is say would transmission barge them. say those thing.

thing. products most have So one of split their our own most are that products construction of is -- projects fundamentals fundamentals our those -- have let's

own economy. of course, the other The demand. they affect ones are whole that are -- drivers rates, the their fundamentals really Interest have of

the affect. factor is So doesn't or to saying tower. it deciding to not barge just buy -- a not a transmission I'm the buy saying I'm it's

On of course, the side, also it construction housing, other and these but all projects. affects multifamily

not we're rates. immune to interest So

to sheet. able we're given we're backlog talk our course, about not. But balance good think be our with really given overcome our Of this and in to and also diversification, I shape

of We capital have sheet we to Gail debt have allocate having also strong some environment, just very strong a correctly. And at when down be paid a able balance and to our in we had this a mentioned, good balance we sheet. the interest balance us you look companies -- et to firms be for do private It some processes, able to equity also be in able take of sheet to higher to presents advantages the be not opportunities of some might other with that might the and able not compete cetera. very, rates.

opportunities. there's and risk there's So

We've you, Yes, spoken Thank today. Antonio. very the a margin lot color. impacts helpful about

I wanted a orders on the how give sense trend So just to you Could quarter? in business. barge touch fourth might the of us

barges. They right a quite now. bit. And not Steel picked to in the and remarks that prices, think don't talk it's got my up want part price It's quarter. the that expect it -- third very the during mentioned little an need a come We the during be quarter, down have mentioned have appealing a of we which our to in them, the I issue the later they was And I the I quarter. third fourth for barges. but you during remarks, they important second bit my to customers, river if steel.

barges. we a barge there for little close new all are closed bit, conditions replace the orders. had very is a coming replace Hot-rolled those able to when to the ago -- levels year to to we're be coil us we So but that up

not again there get I'm that to going something confident time. it's a So and quarter, one-to-one you have But wind. is every not be book-to-bill. demand is going that the like we This just to be

the portion said, accelerate in we business. pretty for I be in significant way we're demand As We're we going midterm scheduled. ramp-up, to factors our but the our the have cautious confident already of production a

have we program at that the appears it questions time. will for remarks. And I no Drabek now further closing Erin over this turn to back

an look you today conference quarter. to call. at us providing next quarter our Thank for update earnings joining additional third forward We

participation. for that Thank your And today's teleconference. concludes you

You may disconnect. now