Englobal (ENGC) 6 May 212021 Q1 Earnings call transcript

Good morning, and welcome to the ENGlobal First Quarter 2021 Financial Results Conference Call.

Your host for this morning are Chief Executive Officer, Mark Hess; Chief Financial Officer, Darren Spriggs; and President, Roger Westerlind. At the request of ENGlobal, today's call is being recorded and will be available for replay on the Investor Relations section of the company's corporate website englobal.com.

You may also access the teleconference replay by dialing toll-free (877) 481-4010 domestically; or (919) 882-2331 internationally and referencing conference ID 41192. This replay will be available shortly after the completion of this event through 9 a.m. Eastern Time on May 13, 2021.

point, Rick like with Eisenberg, this call turn Eisenberg At to over Media Instructions] I to would the Communications. [Operator Relations Director

on operator, call. you, and everyone, joining Thank thanks, us for this

like to Before we begin, review forward-looking statements our provision. I'd

XXXX. from may forward-looking company of made Factors presentation quarter safe note of the the provisions performance for statements Please such operating section under During provide future cause XXXX statements. statements. the other will or ENGlobal such Private Risk company's the this differences forward-looking Reform of company's remainder and the of representatives the Hess, the conference materially results forward-looking analysis Any make now Mark? Securities Act actual today's future XX-K. And A factors achieved that year. of some an first about may results of company call, the the statements outlook CEO, discussion in appears events of Litigation that for are in Mark harbor by differ could present

Thanks, morning, you this us joining everyone. Rick. Good for morning. Thank it. Appreciate

and then think to Roger make comments to some hold my quarter, going to go answer Roger and going comments is I to I've And questions. does let got Darren after I'm a his we'll through say the the comments. end. to go presentation, then until going I'm then few his

over we'll to So at ahead and it get I Darren, turn point, started. this I'll think and go

All right. Thanks, Mark.

was The in in of from revenue due comparable projects Automation was XXXX, XX.X% million down the in the several completed Our segment. which our are large quarter XXXX. or in first XXXX primarily were to revenues million, $XX.X that in quarter $X.X decrease

through our million which quarter. We at the continue $XX.X end of the to was work backlog,

quarter recorded million The $XX,XXX this that increase X initiatives to strategic our our $X.X we workforce to year. in is employee of The in maintaining in compared to anticipate primarily first retention net due a the execute near key same company period tax the variable $X.X time was in on costs quarter credit costs X.X% better margin result lower per sales share. XX.X% gross result projects This important made decline. decline necessary of our last was to gross the experienced over which credit have costs in investment of to year. future. compared to was These financial income for key million business income in primarily profit our Our included in our result QX, primarily the X% starting the one last the clients It in of staffing investment note efforts. enhanced net business were that development last and of recorded higher to our of increase was our advantage other income $X.XX maintaining tax or focuses the is payroll support labor take our the decrease the compared statements. SG&A volume, by $XXX,XXX on that the levels staff as markets. The ability to net we targeted development up in year in income

on be to cash end credit and internally over Our the it We revolving of to last steady will now expected funds capital sufficient of was operations which current the at growth. I fund other company's near-term and will the under the availability sources comparable believe ENGlobal's to working Roger. capital, turn and about generated $XX balance million, working cash year. along remained hand, with

Thanks, everybody. Darren, though It like looks and morning, to we're returning the normal. good new

clients people, it automation shot significant renewables, least has I start by we to that We and supposed now customers pick actually we the continued when renewables can where especially guess, feel with to, first all integration. increase see U.S. new As a the pipe CRM of be plans We market up, the to we in our go and can XX% in we a normal. at know, through X. is July meeting that population return vaccinated our hydrogen, system, see We're year. If to and to understand measure next drive the can for back office, this year activities. ammonia

across We gas, $XXX our that XXXX. In oil all have is renewables long-term worked with well and we see combined confirmed agreements. have over automation, and agreements value significantly which which XXX integration, opportunities of and master market, from with a third million, we up activities are service clients

if look opportunities later will of are, with X quarter we year, pipeline, part fruition optimistic, lot only all the this XXXX. In again, we We this the a these opportunities we to but quarter come we or year, think are the later into of X. about that especially optimistic have,

is of, Mark. in of see On fuels, is end be the plenty. Thank expected the out Haldor and opportunities renewable finished, that for but was XXXX. shift a We expected -- sure and together hydrogen, completed running be for number it Seaboard only to everybody and in We're our shipped of our of is not other When June April of the this XX hydrogen are diesel. to good to in plant building which approximately will will and XX up the this this of news, year renewable modules is scope, And is with Fagen, press by release to plant, closing, we types I'm building be which year. of you. Over renewable million aware produce Topsoe, XX. number completed we these projects the

lagged strong after industry, we COVID. the had many its others reduced Because income reduced by with reduced has the year. Like the earnings, we backlog of year, backlog continue this as work year This over Thank last and is on our much impact you, market backlog. us of of through that effects to deal evidenced that our broader last in Roger. we

in programs to government Therefore, in us. as reductions experienced other without our able the been solutions. our our in providing energy large-scale we've pandemic solar experienced and renewable gas staff, staff. well solutions in to oil have the we expertise as We've so, been and And available able assistance maintain traditional doing hydrogen, to utilized weather

So to we're us. execute as awarded prepared to well they're opportunities

As amount time, that know, confidence business time, spent our needed joined for in November This same time complete XXXX. vertically reorganizing our that backfill is the here service provides senior work of has organization has it's to enormous us team to going been market. At an in into he Roger market-focused each deployed since of people recruiting Roger to offerings in methodology And you our Roger business the integrated ENGlobal. full and I proven at experienced the our clients our where organization. in that past, connected complement development and it a that have

in than since are this our at pay XX they beginning early time been greater are to we ENGlobal is At transition, already ago. have a opportunities dividends. when now the it's I've While to rebound, beginning years economy arrived

them Our for we year. At top high priority is I'll this this to it expectations then convert turn over point, these profitably, opportunities and and questions. into have execute backlog to

have We comments any at questions closing Instructions] have to time. do with? like Mark, you this [Operator queue you'd the finish no in

sticking We I with want great day. shareholders, appreciate our you everyone thank Yes. appreciate and a we listening. have for everybody safe us. to to And wish and

this you. and event. Ladies gentlemen, conclude today's Thank does

day. you may Thank for your You participation. at disconnect a have this wonderful time, and