L.B. Foster (FSTR) 6 Aug 242024 Q2 Earnings call transcript

Hello, and thank you for standing by. Welcome to L.B. Foster's Second Quarter 2024 Earnings Conference Call. [Operator Instructions] I would now like to turn the call over to Stephanie Schmidt of Investor Relations.

You may begin.

Operator. you, Thank and everyone, L.B. Good welcome morning, to Second of Earnings XXXX Call. Foster's Quarter is My company's Investor Schmidt, Relations the name Stephanie Manager.

market second his providing quarter will our results, Our John financial President company's Bill this Bill presenting Officer, developments our morning. We'll company Chief then quarter and in quarter CEO, on with John outlook Thalman, Kasel, start the will John business outlook, and his and comments. market and call perspective on review Financial second will developments operating closing results. provide performance. the the second perspective company's be

We at questions. Today's can release and will with lbfoster.com. our then and open presentation earnings morning page the this be session accessed on up our posted website slide for on financial our were disclosures Relations' along Investor

this the follow comments morning in presentation. slides the earnings will Our

statements and undertake of statements are are our opinions laws. results and and in business current reflect required to release publicly our except new by date These light the of to as making of only markets any the securities these information, represent we our view revisions forward-looking no presentation, statements obligation of today. revise or as of we Some forward-looking this

and see to earnings assumptions risks, forward-looking statements our please For detailed and presentation. more the uncertainties our in disclosures relating release

these We our our within accompanying will encourage disclosures and within also read earnings discuss as release and earnings consider non-GAAP you and you provided to metrics. financial metrics carefully today's reconciliation tables presentation

let that, me call to with So the over John. turn

significant and my years. I what Thank XXXX, CEO President for CEO recap the the second earnings of providing by XX, quarter a Thanks, last over call which company. as you President and in today's begin marked as Company. L.B. joining over Foster the a our year for of anniversary call. Stephanie, for we was of I change took accomplished of XXXX, and I'll thought hello, X us everyone. today X-year July appointment

proceeds us Board senior strategy through and of to and a our established The Technologies technology-oriented cornerstone the initiatives, XXXX. solutions Betler, a guidance, would the vision where business needed the established portfolio Our receive was These transform that business both the in growth team the Board Ray's appropriate, returns strategic had platforms, With company growth assessment organic Precast a and balance in to the additional be Ray in of management generate joined provider. The infrastructure Concrete. of generation, playbook business. the Rail global support, platform. current investment a into fund reassessment helped operating XXXX strategic and profitable namely optimized Chairman, and, the growth divested and to became cash businesses and for businesses inorganic. drive would These a funding to leadership

achieved. more my commoditized we Technologies the on you remarkable, margins These time see the and More in compared and trailing basis has non-core a translating Precast challenging completed cash, year. up our distractions line. to in announced an in States. In we run in X-year over back core complete to period, attrition as groups. X M&A. savings with acquisitions generated strategic EBITDA off X exited XXXX. rate on enterprise-wide Over grid leverage annual XX%, sales topic transactions. this adjusted closing product I leverage, to from restructuring are businesses comments. In improved the were transactions summary, truly used decking points of X X% our achieved, these adjusted sold of generate divestitures we up come to headcount Sales We net completed bridge eliminated response months $X.X gross Proceeds XX.X XXX been in a growth a that, the Concrete United can Kingdom same impactful, in XXXX, just are along and will in of EBITDA market. X X with the local should business the Rail late conditions period, transformation the due XX the U.K. restructuring our results per in is business United to very of the impact impact to already up the Adjusted journey net million and

Now today. on to

our the quarter and broader mentioned announcement, given there's in the As domestic concerns near-term earnings a bit than uncertainty the global and second some we recessionary the weaker was in expected, markets in economies. end

the thought given in demand the continue virtually could XXXX, have cautious outlook. drivers to While approximately macro the some more what expansion believe will so come year. Despite focused midpoint profit would represents end to a to adjusted on return cover guidance guidance to for finishing momentum and will back our the we XX% financials we growth to second our over in EBITDA XXXX and detailed outlook, of it a the control, our prudent be second the end we a aspirational Over flat getting the expansion bit growth. closing can with profitability and sales XXXX impact strong We're XXXX through achieving now half, be I'll markets Bill. of greater that some QX, rates at on organic larger tempered build of towards the goals. Bill our on remarks we financial you, back half we with the for

second my Thanks, comments good highlights begin covering consolidated X. I'll the of the John, Slide on quarter everyone. morning, and

provide the on As detailed always, non-GAAP the information discussed certain the schedules measures in quarter, financial for call. including on the today's results more appendix

the in of portfolio out As done impact we've actions the we'll call applicable. where past,

year well professional year. on adjusted actions Grid our service offset with legal coupled EBITDA weakness profit seasonal quarter largely in the by costs were versus realized incurred restructuring. Net due in impacts were needs provisions EBITDA The higher totaled used the last segment. The was reflect orders were announced down the the I'll on the an impact within certain X the was primarily on at weakness slides adjusted Rail business Slide gain the income the line isolates of were in an nearly with over associated in costs down and improved with was million by realized impact with flat million, quarter the property capital decline cash general the is as last corporate costs needs, $X lower was and divestitures versus the approximately uplift sales the the lower million, gross $X.X some $X.X despite For for in the the quarter margins Deck million, with $XXX,XXX in quarter fees net from portfolio quarter. corporate quarter. Adjusted and these The delivered down combined primarily with to This within net breaks increased quarter, XX.X%. associated portfolio-driven were million million. versus the segment. coupled of were segment margins, sales due and X.X% which X.X% the from margins driven the in primarily well working impact sale quarter. down color XX.X% for the bridge sales excluded with our sales The quarter moment. Gross basis, Rail the legal as restructuring. In business last our commercial for the Infrastructure product Net decline prior X.X% volumes provide the unpack for in $X.X out quarter. Selling, $X.X exit, EBITDA. of EBITDA professional profitability XX.X% with activities primarily them drivers the The segment a year. corporate unfavorable second Rail line due in restructuring. portfolio the to Infrastructure. primarily year the for gain work. professional bridge margins service $X associated year's $XXX,XXX year-over-year profit segment divestiture legacy to and $X.X sales operating due backlog in this on impacts on somewhat of sales to activities. Each later total, Bridge the left last lower as and margins Lower organic these the organic year Rail from included Ties organic million, a improved with the costs as this the of coupled the to property year is by bridges prior and additional on I'll sale ancillary as presentation. The These administrative the due primarily with highlights of an favorable on profitability on the year

the quarters. This despite organic for our and of to Turning we've across performance growth sales well the achievement a business. XX-month second the still on rate markets profitability the prospects of recent above delivering majority short-term headwinds. as organic margin remained macro Slide once the in begin strong clear. quarter uncertainty quarters. softer straight to second margins our confident level delivered manufacturing sales at improved #X, have the X on strong business reflects we're quarter, and margin transformation XX% lower in We're as the Despite X.X%. demand sales, highlights Despite the will trend the portfolio In the left we drivers the the for focused trailing was pricing the long-term execution meantime, see believe improvements and resilient end commercial and expansion trends growth on

Slide in couple the of XX. next starting the performance on quarter, segment and segment I'll the our cover with Over slides, Rail

overall the from Ties last year-over-year, improved were XX.X% by the on unit. Rail year, market down Second and some positive The last in X% divestiture. was note, Solutions quarter products. Services margins in primarily organic were of points Rail lower Global from including XX revenues a prices U.K. driven And volumes and products million within by totaling basis our Technology decline driven year, including business. X.X% rail decline recovery margins X.X% the Management and Friction sales and margins softer $XX.X lower business down a versus rail in

$X.X impact last U.K. quarter, orders Backlog million the within with decreased year $X from million the products divestiture. up prior and the business of the million, year-over-year Second and quarter Ties excluding activity rail $XX.X in year's primarily $XXX.X rail increased decline lower million of

increased XX.X% orders Second backlog quarter rail and XX.X%, respectively. sequentially and

or XX, decreased million $X.X Infrastructure Solutions to Slide Turning on revenue X.X%. segment

basis property. portfolio including line business to gain However, the the concrete XX.X% corporate Precast certain sales excluded coupled totaling million divestiture the quarter. Selling, down was overall realized and million million exit sales margins and the segment realized Rail business to included points. balance unit. of gain steel in $XXX,XXX million, the product on across was the the corporate as quarter steel adjusted increased of provisions $X.X as costs decline to costs improvement net line offset sales from favorable mix losses in unit, exit. softer and million, and the driven $X.X profit on the down flat year. I'll prior divestiture on year-to-date $XXX,XXX legal million, the in over over volumes improved basis backlog QX, was $X.X X.X% in decline was were were company's up was with due associated gains first leverage half The realized the were the The growth well and XX cover favorable from year primarily sales by profit steel flat versus year the which higher to $X strategic relatively sales quarter bridge costs the gross $XXX Chemtec restructuring. Net XX.X%. property our prior X.X%, first million the XXXX. Precast Ties. The on the on within general due Slide as in selling the demand was exit XX $XX.X improved coatings. annual incentive in was XXXX million, liquidity ancillary the and well to with to to million and sale by down next executed activity. transformation, result compared professional segment million our an costs. a $X.X last realized insurance prior now sale primarily Cash increased Organic by partially from funding. I'll sales $X.X product the to over orders of products Slide for as in $XX.X million, Infrastructure needs reflected by of EBITDA, protective million, line property $X.X products points the year The the legal divestiture year-over-year. Backlog year, with The driven $XX.X asset results prior of the business year-to-date a year. Gross X.X% business year attributed the can the were last across activities. improvement orders performance improved million quarter. Gross due in announced million portfolio higher from as $XX due and cover administrative and the in strong due first margins by driven Organic changes including income Rail business $X.X products changes of service while administrative decline used prior were working totaled metrics profit XX. XXXX in #XX. segment primarily be million $XX of ancillary capital seasonal operating and gain activities Organic $X.X

debt net year, prior quarter leverage our in debt we X/XX year. through will level $X.X and with largely the Second declined the versus expectations, the balance of was net decline X.Xx. of a increased line million gross to ratio net turn the while debt This of expect

to ratio by year-end. leverage improve gross the expect also We

second half the normal capital Our results cycle strong in the typically in of year. generation working cash

$XX second longer-term leverage closer million million of to by Xx $XX of with target XXXX, expect between free to half a to cash gross range the year-end. our We in flow ratio

X, about February While of X.X% be long-term to a shortens our deploy X common program's of flow our continue our On prudently repurchase repurchased outstanding in ability to X around manage we confident guidance business from to execution price shares cautious of our a its without of metrics outlook XXXX, average stock, model. we've cash $XX.XX free our the Board an including representing at capital more continuing at per XXXX We approximately the to through cash share. $XX the allows restriction. program, stock Xx over updated tenure along stock in August to reflects approved of remaining priorities, the years approximately the XXX,XXX plan authorization generation of XXXX, cash the allocation given leverage and which remain February modification used Directors of million for our XXXX, to our program. Since in inception capital-light operating

continue the our paid cash reminder, due cash for down strong, allocation Slide August our burden are drivers And priorities million continue for million the the summary, we're flow minimize key through should into place year, outlined to of December. sustainable in improve the federal despite outlook to X now believe free full generation $X remaining million a foreseeable on the of XXXX cash the we should softer on Union NOLs Pacific, and capital As to owed with $X XX. the XXXX. I'll and in moving to $X tax future. In and revisit balance U.S. for next

to see in continue opportunistically managing leverage focus We Technologies on while levels Precast Rail in investing organic growth Concrete. we and opportunities

at further the should by believe Capital program growth investment run level slightly Xx historical in our on to year end. approximately is around near restructuring be back in coming platforms we that savings will of than announced growth quarters. We're to comfortable leverage with X.X% gross our Our is levels cost higher enable expected spending expected given average, investments due which the and sales platforms. over

return allocation to stock prudently program, to to plan lever the repurchase use capital to we changes program. and the this continue opportunities shareholders As to approved we evaluate important mentioned cash our given before, through

particularly consider cash The backlog the quarter the lead Rail or and our in and XX, prospects XXXX in backlog XX consolidated order tuck-in both comments levels order across Consolidated increasingly to record on products this continue demand experiencing improved and as QX $XX orders, the over trailing was refer finally, from rates beyond segments platforms, capital strong covering can a extend with with dividend improved the weaker did million Rail closing second important to Slides order will allocation improve $XX.X lastly, small ratio We year, decline. by to declines. order the while driver book-to-bill a our the lower product X.XX:X, growth become Infrastructure XX.X%. segments, of beyond. My improve, million sequentially within segment rates stronger execution business. coupled free both which XX.X%. And for down revenues, rates times. our Slide high as flow book was reflects last acquisitions as an The the is steel option and backlog, continue And business year-over-year, and that XX XX we in growth is consider down months we expected establish XXXX. goals to portfolio drove

primarily order past, to and As rates project the are mentioned timing in in order large susceptible rail backlog by distribution business. swings driven the

entire as backlog to improved backlog the addition, our steel in will we product X.X%. On growth lower note, develops. some the portfolio the second the we clearer recovery near-term previous to backlog $X.X $XX.X levels In in our purposely average, decline demand this an remain optimistic improving steel once million unit this until backlog demand and down is market in macroeconomic positive across investment business due a in scaled million $XX.X prospects expect or Rail indicating the our The the was for about business remain the summary, versus from million due down is backlog products. Precast with is activities. decline despite lower a headwinds temporary development. in products' and level, Infrastructure or longer-term to experienced decline a improve. In some optimistic as continue U.K. X-quarter conditions million across approximately future well we XX.X%, XX% path up favorable backlog into $X backlog translate XXXX as quarter. our the concrete in outlook line million exit Despite $X.X back

half. hand for rate remarks. on approximately quarter. Thanks John? the for and our in financial on second with an guidance year back time, and for of note, and look next positive reporting a generation XX% XXXX, the closing expected John now I'll to revised to it the forward focused EBITDA on his progress finishing expansion implies adjusted cash growth remain Our We profitability strong

for key Slide market underpinning drivers refer XX outlook. to our Bill. overview Thanks, of an business Please our and

both continue began emphasis segments, the We that work project-related continue and for the the last lines on strong in moving are to pre-pandemic approved U.S. continued longer-term transit markets, realize we trend to ridership particularly balance infrastructure over federal programs 'XX prospects several optimistic expect time. in growth back end in to given business of U.S. at is be XXXX, this In levels years, we relatively repair and beyond. Transit levels, from our overall to investment. the the and on some through

car may loads are highlight be increase On freight resulting derailment X, regarding impacting monitoring rail nice also line, believe deferrals solutions, East year for total the hand, those The the a Class which project market for short uncertainty we is ago, in solutions softer our developing other versus demand within in findings somewhat the our market railroads. domestic and year-over-year. somewhat. The on macroeconomic we're the regional in served opportunity seeing for demand train a Palestine recent track and work

business has market U.K. developments As in believe modestly shown noted the in-country some there. -- and versus of are conditions have economic signs and last modestly improving earlier, our year we stabilized and improving recovery we're

markets, recreational from on benefit Turning buildings and parks record the continues Outdoors Act. by Great spending infrastructure line is to to American CXT our the product campgrounds. funded This

emphasize key growth Foster, long-term come. On residential bode supported segment weather-related road XX, In investment should demand remain like should robust HX, of X we in and projects well remain light cycle for the for rehab saw Slide investment for in regional, this profitable development strong well commercial, into this as expect the our the Notwithstanding sustainable summary, short-term I'd pillars. funding real year and infrastructure expect over L.B. government's to prospects the which Infrastructure of for headwinds thesis for the to robust estate and the as years to by overall XXXX. bridge super We balance is longer we through term.

XXXX steps portfolio, talked the our provide the program that also delivered taken of just to profitability structural in the to we've and year. we First, transform necessary profitability resulting business our is that in expected in strategic about of balance XXXX, improvements improvement through execution the in we restructuring

investment markets. we programs for Second, We're in driving organic growth play for macro infrastructure with to needed infrastructure also multiple investing pure of are in advantage through key the that an multiple are represent the designed our clearly our need regions. in initiatives served served year trends investment believe take growth we that avenues

have this model the half we provides flow valuations business settlement for that deploy payments, a mentioned, free authorization capital-light drivers year our second beyond. outlook profitability us are improved multiple been for And as buyback greater stock with favorable the coupled more cash provide our remain to equity shareholders, Pacific recent to and should completion Bill steady our approach by returns. The our creating flexibility more finally, improvements Union of allocation evidenced of amendment 'XX should with repurchase Third, attractive. disciplined and our deployed capital capital and to stocks just value later have

Of remain with course, approach goals Bill in will prudent mind. in our and leverage I

is X So a XXXX in believe with these close we summary, strategy should goals through XXXX. pillars to deliver results, sound and our updates our reminder our and on execution for aspirational like beyond. I'd our along improving results

#XX. Slide very restructurings the a have improvements We organization. way, made good what of team this progress tough divestitures as I and our XXXX. in I'm on with along of decisions since began leaving recap in more of business short our today's proud a importantly, people very very some that a accomplished a and including tremendous we and, time, business, in find clearly call made some challenging period environment. We in our resulted You'll

in the this from fourth quarter seeing positive of we As result. restructuring I and benefits year those in in mentioned began my year's U.K. the last in we're comments, opening the actions

across the necessary roadmap, the in the with resource our deployment steps business. taking we're our human entire growth strategic and program investment to enable With new capital drive in efficiency platforms line

we do opportunities take of to to to Of off for set the There's we what of do are front advantage XXXX. in in in work from us. fully significant finished far course, us

XXXX, we to and short-term getting can established you chart, we growth the managing XXXX in uncertainty this end back the are on see aspirational on As and our of through goals focused at the HX to help second will Delivering needed required strong momentum of XXXX and for our set half us growth beyond. the year. build exceptional deliver continuing stage the the a in an profitability

continuing thank that, time you for L.B. for back to it the the with turn session. in So And interest Company. Foster operator and Q&A I'll your

first the line Sakai comes Our Instructions] Chris question from [Operator Singular with of Research.

guess -- demand just and rebound some and in going coatings a think from softness seen you supposed We've there? I and rail and kind quarters? How question. top-level fourth this a are steel. the we about into third Do see of to

do. Yes. Absolutely, we

HX, also got weather impacted We by HX. in

some of at So and year these Bill and we're factories. as looking versus look delays year-over-year our and But sequential get EBITDA. XX% talked We're last well today at the some HX starting of I things. in delivery as to about these you growth, through our volumes -- as the

So quite the volume a the bit we're facilities of second our year. half through expecting in of moving

guidance And main then for as million $XX were previously to cash million? free the I'm looking for $XX flow. XXXX break-even at the What drivers now guidance

bit. But Bill. we got some -- that movements going a to we again, little some turn over got on I'll So

stronger we As into were a QX. and we expected, work of that QX, deferring some

Bill, So some balance we're leverage you general. in more up and in a moving to as working context we our got year and going sheet position as to general, around. feel we very, add are in that? some good that want and to our where the little in things But other capital end really very about far still

of volume year. a that is the get in the primary that million, a cash. with is push from that consume the But cash off $XX some We of we'll will We'll million with as latter range thing the of the the release. restructuring. the working up having up some end second savings in midpoint. And million well more likely obviously of a higher The to looking overall. capital end the to result flow as part to Yes. our is as tempered announced That a $XX business, outlined at was we're $XX requirement to In timing business. likely Rail that, half year previously

flow. year full Now, that's cash a

had -- we flow million cash the negative half $XX consumption first So cash in of free year. the of

year. $XX second half flow to the positive million million of free cash in the We expect half be to the second $XX

strong So it's year, for right really the the of year. around break but the expectations full second even half for

course, million Union out with of And payments. of our Pacific year installment the with last we Chris, close $X

So we feel the importantly, more how very we're XXXX. ending year, good into how we're going

Chris, obviously, the of year highlight at the just quarter, item. I the we second cash in want that, the just elevated leverage improvement was leverage back little X.Xx X.Xx. of half a in here end one the profitability And the metric our last half target to of about. that The plus Xx generation year-over-year to in drop closer expected talk see year, will from that the second the

then much or any SG&A And do from there? with this reduced -- it how program, take the what restructuring will numbers are -- a quantifiable you have sort of

of first all. of kind process, walk me the let Well, through

I today years so, absorb we because divestitures in stranded walk just years. X we've those X -- takes through that business. for right? X in to last business is a we to portfolio, got But in the to to needed reason, change and costs how -- doing Which So the we transformation the wanted spoke continued had the we that we time done in here our

knew we of make a so And to needed over that period time a we change.

More steel we by the from an monies taking annual million just make get and back importantly, bringing which, not to $X.X about is the way, was rate. to It out, company focusing sure run cost on company into type the of really a technology we're at company front we're our this distribution as company, type See, weren't the a house. strong on transforming innovation growth. to

year, doing is putting the technology where of the innovation. back front office been administration taking in this do of really what the is customer, 'XX work going from we're we're going we're to out how about and importantly, the we're half get the shoring and front So And we're -- we finish more of in excited much we've of beyond. up putting second in doing. And what

just makes talking a bit had Bill headwinds you makes and yes, focused. here the that stronger I of about today you what is we more and in little but So really, were quarter,

of couple something this we've our it reduction working This this, was did in the what of going something last to is about tough we quarter. is we a a with the And was that was planned. a week, this. company force. But reaction been related last talking So time on in which on months, did with knee-jerk very

last it So year. happened

the year, start the we through into So this importantly, and beyond. benefits of seeing XXXX balance more

Our line Gabelli with the next Funds. Justin comes from of Bergner question

here. few A questions

of Rail cash to free So the deliveries. start, revised flow The timing guide. on just

year receivable? So does end with that accounts mean higher a that expect the to you

yes. Yes,

Now, we other expect Rail would dynamics? within there parts that -- are timing

up receivables. a which account to AR. have strong Definitely, going pump QX, that to is We're going

Strong QX, which Exactly. drive AR revenue for up. will

Got Okay. it.

So second to on in question up continues Rail business to you would the mean, could a in comment Rail. margin, the whether evident mix because mix Technologies as the wasn't it quarter? business maybe relate I decrementals of this

paperwork And the U.K. HX This company then said -- TTM what how as We the what put good strategy. to and we're related we know You all had together a the pivoting and you -- into doing really in what is this condition fantastic those we our -- we're this monitoring. well. all is in work feel about businesses.

a headwinds, that work. This really specific returns lot to very strong seeing saw volume type we're be headwinds backlog. we right business a and the leverage. distribution and have But few our the -- lot the former are ERP a of where and a we carries quite continues to to related So now pivoting. But of rail our is company

Rail that ability through And feel good strong the it technology will second to and really very our we continue very have activity. to profitability year half drive in innovation. demonstrating grow, doing We

Okay.

maybe clarify just So statement. to that

it carry a average still meaningful even fairly guess decrementals I incrementals products business, and not there? though margin, the there's rail may So high

correct. That's

our And of percentage a overall very Yes. it's large Rail business.

year-over-year that a view. year-over-year within favorable extent weakness on that those Rail or just business, the had impact in some mentioned were to as U.K. favorable given So the the from prices as the It's consolidated the as point a challenge script, the short-term it's rail were the in that decrementals. But both -- Rail. has TTM, products commodity it well John business, a mentioned, of call also in our here year-over-year improvements improvement of our components overcame technologies-oriented monitoring we having the in and portion the profitability freight to recovery an in volumes pieces

remove Got from restructuring program, lower ready it a business how costs? side? else? get should it. of stranded on it something the this then And mainly potentially demand? Is just to view of Is what's a is restructuring level the happening for really to think about point I Just

the done it's with taking all a it work stranded costs. office the all slowly we've best better. investment our work to all our about we've SAP, and the technology of streamline the is of getting forward But did, organization. we've type done really in back foot It's part Obviously, innovation, putting

we this X about. But all it's this simplifying innovation the continuing so, the really about move year, rail. our had it aspirational segments beginning what business X It's investor. our to goals did about money through drive we're the precast is And our is put to to technology, from and in specifically company, all doing of we simplifying where doing these As is. we in segments what at you, this to mouth

redeploying out And ourselves doing money in over to -- we're the also about the game. we're the monies house It really market of and how our of and or customer. and end result. taking That the to them it wasn't front portfolio a So what front really, was changing redeploying the taking time. those redefining was

that then there say say maybe incremental? you is you with I approached Okay. this some would Or the That's as goals? restructuring XXXX is those it very aspirational program mean, to was helpful. goals, And safe envisioned

was vision. No, a always there

at percentages. implied, could we high least as were SG&A to running of we you that you kind If see at the out we our laid or look

company years, the In last changes, have the you some now. to in technology as didn't ready, talking couple this in We to moves, time, not incremental these We're through the through stabilize well we we've wanted been make to which these we in of working place ready for wanted internally. take XXXX, weren't So and We wait about and as had get of headwinds. things the honestly. the a skills company, the little if we wanted bit in happen. will. We these the XXXX, we the position portfolio did right when to people

we kind we said, ripped last So the go. "Here band-aid week and of off

this." after get Let's

Okay. Got it.

meet doesn't any higher your or growth? it there's that to change serve So seem ability like demand will affect

you the If the bullish and tell -- me bring to we be it on future the do put let as the did, company. me this what not we way. to needed We do Let would didn't profitability I continue aspirational invest goals. to this, in

with next of Advisors. line comes John Wealth Ascend question Bair the Instructions] from [Operator Our

Is what a It quick didn't can expand or had like, the see, looks relates let's quarter expense this a that issue, anything on in in quarter. see first that to? you you one-time legal First that question.

Yes, the get little you sure. want with color… Bill, a to maybe

ongoing We've expand working Yes, going matter it to we're we're that what an to. through. relates got not

it's I about be. in the can't $XXX,XXX same could conclusion and what don't a additional be the manage ongoing be here the expense in think amount just We can. future. as quarter. to we've We fast to that mentioned, we it going think level predict past, within we're that that'll but an it'll something had as as There to was the it's some we

Do you resolved? be have this of any when issue will -- sense

active as It's we possible. resolve to not. Unfortunately an soon as matter, hope it and

Okay.

edge the drag finalized. So -- not longer? of being out months X It could on or

We'd to takes settle as course. but soon say. that, we can, to hard It's to possibly counterparty as achieve love of it it a

you're encouragement perhaps or…? with with indicated to some question that's I've right. regards seeing, All that U.K. Okay. a what think sustainable you is to, something from you Do the regards got

Yes.

reduction is more themselves a if what importantly, we did you take that quite So last I on, activity shareholder actions X tuning, team fourth did really aligned some to we quarter week. The and job, reinventing to force we we're they've think X Neil there mean, I we we the to very sure then, a really did they've make get and focused The charges Prime organization. had fine under the would in of value. actions, do what will, new important, it the of the that thought turmoil in be. just doing tremendous part in had were Sheffield over some And and how we years. driving Ministers of the leadership enterprise can additional do

be pleased technology in to a into the for looking future, but that's not doing. relates much stretch for taking very okay. large We'd for going very it it they're what the innovation what globe on growth there. rail. We're tough they what's us. as center do we're across we're They've of the It's a us -- with COVID. And huge may So of area COVID, had through like

we're So, today. where they're happy very at

was in we then And with previous highlighted domestic questions, there remarks, prepared regards to forth. so a as the little but sounds on rail, this you and that touched some softness it bit in if

do a your look more timing this you is lumpiness to that larger fair of reference it? customers, a because orders, So of Is at in from expected way issue timing commitments? that

fair This is a way.

of about when all, at So good rail, look first of aspects back good We at Transit, ridership rail, all, you levels. that. you to the is both news, first to pre-pandemic have very look right? felt of

do or in half nice rail we of a what in transit play space. have We is

good for very news is this So us.

about that more second good why half. Again, the half. the we'll we So very feel second see of activity more in and

look to Pacific of moving freight side, was doing going on the Canadian respectively all, they're National and you On Canadian okay. at Canada, commodities. and to first intermodal got

U.S. little the though, a in Here softer. it's

have they deferred products rail back some we've the conversation delayed to that spending. of is so, and their And And had. this

busy they typically HX. of the is the saw in going work it quarter, so that half the second we --or, just me, excuse We're be work on some coming. the So HX year. second the seeing deferred very of in to Related, now we're in

stronger quarter, So the little know, just bit pick John. continue the you fell provide we've past. that need a But to we're related we We in that to they had look fourth again. Railroads demand. going year We first probably a a invest as stronger type and stuff than for see need. seen off to quarter in a up great of

us feel help rail showing monitoring, maintenance run very more And about of our up we the really, That's network. we're excitingly, that secure beyond. good of on fully gives keep our excitement a a them a half our second year, they're going really, more excitement condition that where doing they're the 'XX devices the lot they'll TTM, in into really bullish So lot and the work. and activity, seeing and safe of

Last infrastructure. Indicated sales your domestic impacted Okay. on question. weather

your quarter. were take and meaningful? that's going indication up, it that at pushing around? to protective turn Is about coatings stuff basically, third from of the out comments is this So to just that there more any the kind pick you're that into will second what from for way Aside Or down, to quarter look become it?

about in with We those hit got talk specifically on hard going Let's and what's infrastructure related weather. precast lines. to product

days, short facilities week things away. up Our construction they happening wettest employees they -- regions. does locations it's products, seeing go record, very as year, that are And they the are weather. over year-to-date, the outages. on the had to We're can't product are wet. Not Tennessee, what's in only were related pent and located is the build down the use our for affecting of shut If case they power of or to needed. That's record, drying their our some in just one the And what's in that underground, not the wettest areas. other and on importantly third half well year put wet, through work, a That the can't first case, demand. more get Texas as Very, it's this In obviously out hurricane going can't infrastructure week. as there. we need and to

get just these ground, need second be need products these They the much in in the wider So in of half the they open areas going built. year. to these to to get spick is products

we ready. We're good. So, very feel

products sitting We in have plants. We're our sitting products to in yards, our ready deliver.

of HX. We we're we strong Specialized is expected. second a types an those business well. again, for working that feel business. then we they're have the at good the directly with to have doing have going of specialized SIFCO, coater. very projects year. The coater we X And inline Coming are So coater as very half a what have about coating and to, we looking coater why got back inline

And or And of part right the now many at election see on it's counting pipelines, know, not That much may cycle. But that not too guidance really, half we're providing the moving on doing you of change year. different between not the we're a it's know, don't business we activity You different going in states not that with much. of now. second right all. our

So big a top be if comes be, we're that'll today. looking in back you on what at know, of that way, that'll

What it around? take products? And turn what will that steel to about

They our well. hit So, Houston. threading for wet, when irrigation everybody it's our you doing pipe. And threading the else. very say with is of in do turn business like got when course, this is We actually around, weather

the right to it is not as taking the West. And we starting our dries we're around pipe for now. entry West irrigation nice our see that So Coast change out pipe a as threaded but needed, pipe, the demand in new in market have

So we we're feel there. about doing good what

to business that side, left the month made nice business, On last we which steel the we right? forms us from a And grid a party, bridge and decking on closed pivot business. moved book our that another

to Tampa, level. cycle. out continue We're a job the In that. We us of fact, bridge. very feel finishing world-class we bidding an I-X facility. good use in quite investment down opportunities largest to about ever very the We a at super -- We talked just about They're got operating Florida we the which had is front there that. up a on few activities in and board facility. It's we've did, tutored the high

business we're the So, quite coming for the looking a second and through of of half work that plant bit in that year.

follow-up line Justin of have Bergner We'll the with from a question Gabelli.

maybe mean, weak. quarter. gets talking about, caught talking fourth at, you're the but all in much, take I'm headwinds protective rail looking you down just up I that in And high coatings guide. the really sales some the sure. end being and didn't to not I'm

$XX some offset trying end? there to I'm that's high down allowing the put pieces? at together sales just positive million the is to guide be by So only taken the

basically ever. off Yes, year, of best that the Act having on a but of side, especially we're Outdoors tremendous referenced sold into is in This don't the the Great color we today, year. legacy for balance year this, all we American our business, comments get precast our the

VanHooseCo, of upside these where going products. come. And that's bringing So is the new is which then to acquisition

second hit Of the and with Tennessee the markets year of there. that's But in as area well. and course, got going the we serve weather half other on things upside other in for we an

Okay.

might the something overall year. I to of just Justin, add as that mix business in the helps That's well. half the that second

while up down the really, nicely top have guidance, somewhat year, flat we in So a is line of per overall we're the a slightly half profitability the second overall year-over-year the on basis.

will see despite improved top the that in we'll profit So half line the an business expansion drive second softness mix overall.

the I'm showing queue. call turn no closing John to like remarks. now would further I questions in over for back the to

we every in mentioned us Thanks, we're Back the you culture way related the company, have because to joining much But Wanda. you safety. the value And gone X want each company you and really of speaks safety wrong at treat how continued of the get safety goals better the a still and a in together. In rail quarter, year. look last your industry of look years when be, standards. And to of worse that at business result struggled 'XX, 'XX years, sort safety with a to their how our employees, at and course, to coming things But We've performance first last focused results good for really real we everybody appreciate year-over-year. year-over-year lot company really could want XX, in We for profitable core X the the our our as industry. of on just it today. close our are you is couple last Foster and I in remarks thanks of of it. a way, rail better And thanks the safety in from to I questions. be really here specifically. much,

we So down, sat to said, need last we we this. change year

making a staff, fantastic an part our core real have a year focus Betler and every of a done each of to guy half has our adding safety in zero group. -- better. We first fact, day Leadership, of to team just number injuries. and done Rail the compliments fabric including So named his congratulations the on value with made safety job. and company. They of results. That's operations Scully, a completed Dennis getting making tremendous the recordable changes Ray And to

worked man with rail we When In did business, results of back to company. XX% if at you across that hours, fact, a we work means hours, which look perfect hours the want hours no look that from recordable it as you at XXX,XXX over the have entire injury that point. represents what

very focused So that. on tremendous,

from million good. business of So headwinds, at but something over view, backlog is we had efficiency look some back. the feel yes, point operational, $XXX is we've from A coming good about. Coatings that

in deliver of half we will to second So year we're and the the deliver. ready

a as look where to we you first HX exactly point over is, those to HX, the we second we strong second wanted reminder, had very we So quarter. And year-over-year. off do quarter, my but macro situations, of We're a it's when not expected were continuing manage course, be. X% to

a You look guidance, you we're at year-over-year XX% EBITDA. at putting HX, on improvement midpoint in, a what look of showing we're our

when the to up will EBITDA which to in So and across a company, look group, year-over-year to the us. And give and and you in we're that's driving have improvement what return, this midpoint, of do. how us my midpoint we're market to front the what finished product it, we bringing making our at challenge, team forecasting shareholder XX% this we everybody the

balance make have and happen make will all it will us this, the it we for we of year. we opportunities happen. We're in of front and to the in So do the

And Bill Take and we're for L.B. in thanks ongoing to Thanks talk early myself, Company. care support. November. in of your So on behalf know speaking Bye-bye. looking to Foster now. much you your very forward for interest for I

gentlemen, for today's and concludes you Thank this conference. Ladies your participation.

now disconnect. may You