Matrix Service Company Reports Fiscal Year 2025 Second Quarter Results
Matrix Service Company (MTRX) reported its Q2 FY2025 results with revenue of $187.2 million, up 7% year-over-year. The company posted a net loss of $(0.20) per share compared to $(0.10) in the prior year quarter. Total backlog stood at $1.3 billion with quarterly project awards of $90.5 million.
Storage and Terminal Solutions segment revenue increased 53% to $95.5 million, while Utility and Power Infrastructure segment revenue grew 52% to $61.1 million. However, Process and Industrial Facilities segment revenue decreased to $30.6 million.
The company maintains strong liquidity of $211.7 million with no outstanding debt. Management lowered full-year revenue forecast by approximately 5% due to temporary permitting and project start delays, but expects return to profitability in second half of FY2025 with over 40% year-over-year revenue growth.
Matrix Service Company (MTRX) ha riportato i risultati del secondo trimestre dell'anno fiscale 2025, con ricavi pari a 187,2 milioni di dollari, in aumento del 7% rispetto all'anno precedente. L'azienda ha registrato una perdita netta di $(0,20) per azione, rispetto a $(0,10) nello stesso trimestre dell'anno precedente. L’ammontare totale degli ordini in sospeso è stato di 1,3 miliardi di dollari, con premi per progetti trimestrali di 90,5 milioni di dollari.
Il segmento Soluzioni di Stoccaggio e Terminali ha visto un aumento del fatturato del 53%, raggiungendo i 95,5 milioni di dollari, mentre il segmento Utilità e Infrastruttura Energetica ha registrato una crescita del 52%, con ricavi pari a 61,1 milioni di dollari. Tuttavia, il fatturato del segmento Processi e Impianti Industriali è diminuito a 30,6 milioni di dollari.
L'azienda mantiene una liquidità solida di 211,7 milioni di dollari senza debiti in sospeso. La direzione ha abbassato la previsione di ricavi per l'intero anno di circa il 5% a causa di ritardi temporanei nei permessi e nell'avvio dei progetti, ma si aspetta un ritorno alla redditività nella seconda metà dell'anno fiscale 2025, con una crescita dei ricavi superiore al 40% rispetto all'anno precedente.
Matrix Service Company (MTRX) informó sus resultados del segundo trimestre del año fiscal 2025, con ingresos de $187.2 millones, un aumento del 7% en comparación con el año anterior. La compañía reportó una pérdida neta de $(0.20) por acción, en comparación con $(0.10) en el mismo trimestre del año anterior. El total de órdenes pendientes se situó en $1.3 mil millones con premios de proyectos trimestrales de $90.5 millones.
Los ingresos del segmento de Soluciones de Almacenamiento y Terminales aumentaron un 53% a $95.5 millones, mientras que los ingresos del segmento de Utilidad e Infraestructura Energética crecieron un 52% a $61.1 millones. Sin embargo, los ingresos del segmento de Procesos e Instalaciones Industriales disminuyeron a $30.6 millones.
La compañía mantiene una sólida liquidez de $211.7 millones sin deudas pendientes. La administración redujo la previsión de ingresos para todo el año en aproximadamente un 5% debido a retrasos temporales en permisos y el inicio de proyectos, pero espera regresar a la rentabilidad en la segunda mitad del año fiscal 2025, con un crecimiento de ingresos de más del 40% en comparación con el año anterior.
Matrix Service Company (MTRX)는 2025 회계연도 2분기 실적을 보고하며, 수익은 1억 8720만 달러로 전년 동기 대비 7% 상승했다고 발표했습니다. 회사는 주당 $(0.20)의 순손실을 기록했으며, 이는 전년 동기 $(0.10) 손실에 비해 악화된 결과입니다. 총 미결제 주문량은 13억 달러로, 분기별 프로젝트 수주는 9050만 달러를 기록했습니다.
저장 및 터미널 솔루션 부문의 수익은 53% 증가하여 9550만 달러에 달했으며, 공공 및 전력 인프라 부문 역시 52% 성장하여 6110만 달러에 도달했습니다. 그러나 공정 및 산업 시설 부문의 수익은 3060만 달러로 감소했습니다.
회사는 2억 1170만 달러의 강력한 유동성을 유지하고 있으며, 이자 부채는 없습니다. 경영진은 일시적인 허가 지연 및 프로젝트 시작 지연으로 인해 연간 수익 예측을 약 5% 낮췄지만, 2025 회계연도 하반기에는 40% 이상의 연간 수익 성장률과 함께 수익성 회복을 예상합니다.
Matrix Service Company (MTRX) a annoncé ses résultats du deuxième trimestre de l'exercice 2025, avec des revenus de 187,2 millions de dollars, en hausse de 7 % par rapport à l'année précédente. L'entreprise a affiché une perte nette de $(0,20) par action contre $(0,10) au trimestre de l'année précédente. Le carnet de commandes total s'élevait à 1,3 milliard de dollars, avec des attributions de projets trimestriels de 90,5 millions de dollars.
Le segment des solutions de stockage et de terminaux a enregistré une augmentation de 53 % de ses revenus, atteignant 95,5 millions de dollars, tandis que le segment des utilités et des infrastructures énergétiques a connu une hausse de 52 %, atteignant 61,1 millions de dollars. En revanche, le revenu du segment des processus et des installations industrielles a diminué à 30,6 millions de dollars.
L'entreprise maintient une solide liquidité de 211,7 millions de dollars sans dettes en cours. La direction a abaissé la prévision de revenus pour l'année entière d'environ 5 % en raison de retards temporaires de permis et de démarrage de projets, mais s'attend à un retour à la rentabilité dans la seconde moitié de l'exercice 2025, avec une croissance des revenus supérieure à 40 % par rapport à l'année précédente.
Matrix Service Company (MTRX) berichtete über die Ergebnisse des 2. Quartals des Geschäftsjahres 2025 mit einem Umsatz von 187,2 Millionen Dollar, was einem Anstieg von 7 % im Vergleich zum Vorjahr entspricht. Das Unternehmen verzeichnete einen Nettoverlust von $(0,20) pro Aktie, im Vergleich zu $(0,10) im gleichen Vorjahresquartal. Der Gesamtauftragsbestand betrug 1,3 Milliarden Dollar mit vierteljährlichen Projektvergaben von 90,5 Millionen Dollar.
Der Umsatz im Segment Speicher- und Terminals Lösungen stieg um 53 % auf 95,5 Millionen Dollar, während der Umsatz im Segment Versorgungs- und Energieinfrastruktur um 52 % auf 61,1 Millionen Dollar wuchs. Der Umsatz im Segment Prozesse und industrielle Anlagen fiel jedoch auf 30,6 Millionen Dollar.
Das Unternehmen hält eine starke Liquidität von 211,7 Millionen Dollar ohne ausstehende Schulden. Das Management senkte die Umsatzprognose für das gesamte Jahr um etwa 5 % aufgrund vorübergehender Genehmigungs- und Projektstartverzögerungen, erwartet jedoch eine Rückkehr zur Rentabilität in der zweiten Hälfte des Geschäftsjahres 2025 mit einem Umsatzwachstum von über 40 % im Jahresvergleich.
- Strong liquidity position of $211.7M with zero debt
- Revenue increased 7% YoY to $187.2M
- Storage and Terminal Solutions segment revenue up 53%
- Utility and Power Infrastructure segment revenue up 52%
- Expected 40% revenue growth in H2 FY2025
- Substantial backlog of $1.3B
- Net loss widened to $(0.20) per share from $(0.10)
- Book-to-bill ratio declined to 0.5x
- Process and Industrial Facilities segment revenue decreased significantly
- 5% reduction in full-year revenue forecast
- Gross margin declined to 5.8% from 6.0%
Insights
Matrix Service Company's Q2 FY2025 results present a complex picture that requires careful analysis. While topline growth of
Segment Performance Divergence:
- Storage and Terminals Solutions showed robust growth (
53% increase) with improved margins - Utility and Power Infrastructure grew
52% with better margins - Process and Industrial Facilities experienced a sharp
57% decline, with margins dropping from9.4% to1.2%
Strategic Challenges:
- Book-to-bill ratio of 0.5x indicates significant slowdown in new orders
- Management's
5% reduction in revenue guidance and$50 million revenue push to FY2026 suggests near-term headwinds - Construction overhead costs remain high relative to current revenue levels, pressuring margins
Financial Strength:
- Zero debt and
$211.7 million liquidity provide strategic flexibility - Positive operating cash flow of
$33.6 million demonstrates strong working capital management 90% repeat customer rate indicates strong market position
The company's pivot toward large, complex infrastructure projects positions it well for long-term growth, but near-term execution and margin challenges need to be addressed. The management's expectation of
TULSA, Okla., Feb. 05, 2025 (GLOBE NEWSWIRE) -- Matrix Service Company (Nasdaq: MTRX), a leading North American industrial engineering, construction, and maintenance contractor, today announced results for the second quarter of fiscal 2025 ended December 31, 2024.
SECOND QUARTER FISCAL 2025 RESULTS
(all comparisons versus the prior year quarter unless otherwise noted)
- Total backlog of
$1.3 billion - Total project awards in the quarter of
$90.5 million , resulting in a book-to-bill ratio of 0.5x - Revenue of
$187.2 million , an increase of7% - Net loss per share of
$(0.20) versus$(0.10) ; adjusted net loss per share of$(0.20) (1) versus$(0.18) - Adjusted EBITDA of
$(2.2) million (1) versus$0.1 million - Cash flow from operations of
$33.6 million - Liquidity at December 31, 2024 of
$211.7 million with no outstanding debt
______________________
(1) Adjusted net loss and adjusted loss per share are non-GAAP financial measures which exclude gain on sale of non-core assets, Adjusted EBITDA is a non-GAAP financial measure which excludes interest expense, interest income, income taxes, depreciation and amortization expense, gain on asset sales, and stock-based compensation. See the Non-GAAP Financial Measures section included at the end of this release for a reconciliation to net loss and net loss per share.
MANAGEMENT COMMENTARY
“We continued to execute on our diverse backlog of large, multi-year projects during the second quarter, culminating in sustained organic revenue growth in the period,” said John Hewitt, President and Chief Executive Officer of Matrix Service Company. “We delivered year-over-year revenue growth within both our Storage and Terminal Solutions and Utility and Power Infrastructure segments during the second quarter, as we continue to drive strong project execution across the organization,” continued Hewitt. “As backlog conversion to revenue continues to accelerate in the second half of our fiscal year, we expect to realize an improvement in fixed cost absorption, operating leverage and margin realization, consistent with our strategic focus on improved profitability.
“The pace of recent project awards and starts on booked work converting to revenue slowed during the first half of fiscal 2025. This slowness is due to a combination of temporary permitting and project start delays caused by third parties, which we believe have now concluded, together with pre-election policy uncertainty within our core energy markets,” continued Hewitt. “As a result, we’ve lowered our full-year revenue forecast by approximately
“Our strategic focus on large, complex projects across the energy and industrial landscape position Matrix to capitalize on what we expect will be an historic period for domestic infrastructure investment over the next decade,” said Hewitt. “Our proven ability to service the full project lifecycle, from engineering and fabrication to construction and maintenance, provide customers with a turnkey solution that continues to drive high customer retention, with approximately
“Exiting the fiscal second quarter, we continue to maintain strong balance sheet discipline, with more than
FINANCIAL SUMMARY
Fiscal 2025 second quarter revenue was
Gross margin was
SG&A expenses were
For the second quarter of fiscal 2025, the Company had a net loss of
SEGMENT RESULTS
Storage and Terminals Solutions segment revenue increased
Utility and Power Infrastructure segment revenue increased
Process and Industrial Facilities segment revenue decreased to
BACKLOG
The Company’s backlog was
| Three Months Ended | ||||||||
| December 31, 2024 | Backlog as of | |||||||
| Segment: | Awards | Book-to-Bill(1) | December 31, 2024 | |||||
| Storage and Terminal Solutions | $ | 32,826 | 0.3x | $ | 738,986 | |||
| Utility and Power Infrastructure | 21,442 | 0.4x | 318,516 | |||||
| Process and Industrial Facilities | 36,270 | 1.2x | 253,632 | |||||
| Total | $ | 90,538 | 0.5x | $ | 1,311,134 | |||
______________________
(1) Calculated by dividing project awards by revenue recognized during the period.
FINANCIAL POSITION
Net cash provided by operating activities during the first half of fiscal 2025 was
As of December 31, 2024, Matrix had total liquidity of
FISCAL YEAR 2025 FINANCIAL GUIDANCE
The following forward-looking guidance reflects the Company’s current expectations and beliefs as of February 5, 2025. Various factors outside of the Company's control may impact the Company's revenue and business. This includes the timing of project awards and starts which may be impacted by market fundamentals, client decision-making, federal policy uncertainty, and the associated regulatory environment. The following statements apply only as of the date of this disclosure and are expressly qualified in their entirety by the cautionary statements included elsewhere in this document.
Today, Matrix provided an update to its fiscal year 2025 revenue guidance:
| Fiscal Year 2024 | Fiscal Year 2025 | Fiscal Year 2025 | ||||
| Actual | Previous Guidance | Current Guidance | ||||
| Revenue |
CONFERENCE CALL DETAILS
In conjunction with the earnings release, Matrix Service Company will host a conference call with John R. Hewitt, President and CEO, and Kevin S. Cavanah, Vice President and CFO. The call will take place at 10:30 a.m. (Eastern) / 9:30 a.m. (Central) on Thursday, February 6, 2025.
Investors and other interested parties can access a live audio-visual webcast using this webcast link, or through the Company’s website at www.matrixservicecompany.com on the Investors Relations page under Events & Presentations.
If you would like to dial in to the conference call, please register at least 10 minutes prior to the start time. Upon registration, participants will receive a dial-in number and unique PIN to join the call as well as an e-mail confirmation with the details.
For those unable to participate in the conference call, a replay of the webcast will be available on the Investor Relations page of the Company's website.
The conference call will be recorded and will be available for replay within one hour of completion of the live call and can be accessed following the same link as the live call.
ABOUT MATRIX SERVICE COMPANY
Matrix Service Company (Nasdaq: MTRX), through its subsidiaries, is a leading North American industrial engineering, construction, and maintenance contractor headquartered in Tulsa, Oklahoma with offices located throughout the United States and Canada, as well as Sydney, Australia and Seoul, South Korea.
The Company reports its financial results in three key operating segments: Storage and Terminal Solutions, Utility and Power Infrastructure, and Process and Industrial Facilities.
With a focus on sustainability, building strong Environment, Social and Governance (ESG) practices, and living our core values, Matrix ranks among the Top Contractors by Engineering-News Record, was recognized for its Board diversification by 2020 Women on Boards, is an active signatory to CEO Action for Diversity and Inclusion, and is consistently recognized as a Great Place to Work®. To learn more about Matrix Service Company, visit matrixservicecompany.com.
This release contains forward-looking statements that are made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These statements are generally accompanied by words such as “anticipate,” “continues,” “expect,” “forecast,” “outlook,” “believe,” “estimate,” “should” and “will” and words of similar effect that convey future meaning, concerning the Company’s operations, economic performance and management’s best judgment as to what may occur in the future. Future events involve risks and uncertainties that may cause actual results to differ materially from those we currently anticipate. The actual results for the current and future periods and other corporate developments will depend upon a number of economic, competitive and other influences, including the successful implementation of the Company's business improvement plan and the factors discussed in the “Risk Factors” and “Forward Looking Statements” sections and elsewhere in the Company’s reports and filings made from time to time with the Securities and Exchange Commission. Many of these risks and uncertainties are beyond the control of the Company, and any one of which, or a combination of which, could materially and adversely affect the results of the Company's operations and its financial condition. We undertake no obligation to update information contained in this release, except as required by law.
For more information, please contact:
Kellie Smythe
Senior Director, Investor Relations, Marketing, Communications & Sustainability
T: 918-359-8267
Email: ksmythe@matrixservicecompany.com
| Matrix Service Company Consolidated Statements of Income (In thousands, except per share data) | ||||||||||||||||
| Three Months Ended | Six Months Ended | |||||||||||||||
| December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | |||||||||||||
| Revenue | $ | 187,169 | $ | 175,042 | $ | 352,748 | $ | 372,701 | ||||||||
| Cost of revenue | 176,277 | 164,453 | 334,043 | 350,253 | ||||||||||||
| Gross profit | 10,892 | 10,589 | 18,705 | 22,448 | ||||||||||||
| Selling, general and administrative expenses | 17,286 | 15,731 | 35,866 | 32,844 | ||||||||||||
| Operating loss | (6,394 | ) | (5,142 | ) | (17,161 | ) | (10,396 | ) | ||||||||
| Other income (expense): | ||||||||||||||||
| Interest expense | (145 | ) | (319 | ) | (234 | ) | (644 | ) | ||||||||
| Interest income | 1,578 | 162 | 3,150 | 312 | ||||||||||||
| Other | (556 | ) | 2,454 | (495 | ) | 4,716 | ||||||||||
| Loss before income tax expense | (5,517 | ) | (2,845 | ) | (14,740 | ) | (6,012 | ) | ||||||||
| Provision (benefit) for federal, state and foreign income taxes | 16 | 6 | 16 | 6 | ||||||||||||
| Net loss | $ | (5,533 | ) | $ | (2,851 | ) | $ | (14,756 | ) | $ | (6,018 | ) | ||||
| Basic loss per common share | $ | (0.20 | ) | $ | (0.10 | ) | $ | (0.53 | ) | $ | (0.22 | ) | ||||
| Diluted loss per common share | $ | (0.20 | ) | $ | (0.10 | ) | $ | (0.53 | ) | $ | (0.22 | ) | ||||
| Weighted average common shares outstanding: | ||||||||||||||||
| Basic | 27,801 | 27,377 | 27,680 | 27,314 | ||||||||||||
| Diluted | 27,801 | 27,377 | 27,680 | 27,314 | ||||||||||||
| Matrix Service Company Consolidated Balance Sheets (In thousands) | ||||||||
| December 31, 2024 | June 30, 2024 | |||||||
| Assets | ||||||||
| Current assets: | ||||||||
| Cash and cash equivalents | $ | 156,777 | $ | 115,615 | ||||
| Accounts receivable, net of allowance for credit losses | 134,726 | 138,987 | ||||||
| Costs and estimated earnings in excess of billings on uncompleted contracts | 34,711 | 33,893 | ||||||
| Inventories | 7,157 | 8,839 | ||||||
| Income taxes receivable | 179 | 180 | ||||||
| Prepaid expenses and other current assets | 10,372 | 4,077 | ||||||
| Total current assets | 343,922 | 301,591 | ||||||
| Restricted cash | 25,000 | 25,000 | ||||||
| Property, plant and equipment - net | 41,392 | 43,498 | ||||||
| Operating lease right-of-use assets | 18,160 | 19,150 | ||||||
| Goodwill | 28,883 | 29,023 | ||||||
| Other intangible assets, net of accumulated amortization | 1,103 | 1,651 | ||||||
| Other assets, non-current | 55,385 | 31,438 | ||||||
| Total assets | $ | 513,845 | $ | 451,351 | ||||
| Matrix Service Company Consolidated Balance Sheets (continued) (In thousands, except share data) | ||||||||
| December 31, 2024 | June 30, 2024 | |||||||
| Liabilities and stockholders’ equity | ||||||||
| Current liabilities: | ||||||||
| Accounts payable | $ | 79,976 | $ | 65,629 | ||||
| Billings on uncompleted contracts in excess of costs and estimated earnings | 237,537 | 171,308 | ||||||
| Accrued wages and benefits | 13,288 | 15,878 | ||||||
| Accrued insurance | 4,473 | 4,605 | ||||||
| Operating lease liabilities | 3,781 | 3,739 | ||||||
| Other accrued expenses | 2,044 | 3,956 | ||||||
| Total current liabilities | 341,099 | 265,115 | ||||||
| Deferred income taxes | 23 | 25 | ||||||
| Operating lease liabilities | 18,194 | 19,156 | ||||||
| Other liabilities, non-current | 2,595 | 2,873 | ||||||
| Total liabilities | 361,911 | 287,169 | ||||||
| Commitments and contingencies | ||||||||
| Stockholders’ equity: | ||||||||
| Common stock — | 279 | 279 | ||||||
| Additional paid-in capital | 145,608 | 145,580 | ||||||
| Retained earnings | 19,185 | 33,941 | ||||||
| Accumulated other comprehensive loss | (10,462 | ) | (9,535 | ) | ||||
| Treasury stock, at cost — 285,392 and 579,422 shares as of December 31, 2024 and June 30, 2024, respectively; | (2,676 | ) | (6,083 | ) | ||||
| Total stockholders' equity | 151,934 | 164,182 | ||||||
| Total liabilities and stockholders’ equity | $ | 513,845 | $ | 451,351 | ||||
| Matrix Service Company Condensed Consolidated Statements of Cash Flows (In thousands) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | ||||||||||||
| Operating activities: | |||||||||||||||
| Net loss | $ | (5,533 | ) | $ | (2,851 | ) | $ | (14,756 | ) | $ | (6,018 | ) | |||
| Adjustments to reconcile net loss to net cash provided (used) by operating activities: | |||||||||||||||
| Depreciation and amortization | 2,510 | 2,781 | 5,025 | 5,692 | |||||||||||
| Stock-based compensation expense | 2,257 | 2,030 | 4,568 | 3,785 | |||||||||||
| Gain on disposal of property, plant and equipment | (132 | ) | (2,223 | ) | (64 | ) | (4,589 | ) | |||||||
| Other | (57 | ) | 53 | (19 | ) | 125 | |||||||||
| Changes in operating assets and liabilities increasing (decreasing) cash: | |||||||||||||||
| Accounts receivable, net of allowance for credit losses | (13,820 | ) | (13,209 | ) | (18,930 | ) | (19,752 | ) | |||||||
| Costs and estimated earnings in excess of billings on uncompleted contracts | (2,893 | ) | 1,943 | (818 | ) | 4,462 | |||||||||
| Inventories | 351 | 712 | 1,682 | (1,004 | ) | ||||||||||
| Other assets and liabilities | 1,617 | 5,906 | (6,963 | ) | (1,763 | ) | |||||||||
| Accounts payable | 18,377 | (12,130 | ) | 14,474 | (14,303 | ) | |||||||||
| Billings on uncompleted contracts in excess of costs and estimated earnings | 32,925 | 44,140 | 66,229 | 31,837 | |||||||||||
| Accrued expenses | (2,004 | ) | 2,452 | (4,912 | ) | 2,257 | |||||||||
| Net cash provided by operating activities | 33,598 | 29,604 | 45,516 | 729 | |||||||||||
| Investing activities: | |||||||||||||||
| Capital expenditures | (915 | ) | (381 | ) | (2,859 | ) | (859 | ) | |||||||
| Proceeds from sale of property, plant and equipment | 163 | 188 | 163 | 2,806 | |||||||||||
| Net cash provided (used) by investing activities | (752 | ) | (193 | ) | (2,696 | ) | 1,947 | ||||||||
| Financing activities: | |||||||||||||||
| Advances under asset-backed credit facility | — | 10,000 | — | 10,000 | |||||||||||
| Repayments of advances under asset-backed credit facility | — | (20,000 | ) | — | (20,000 | ) | |||||||||
| Proceeds from issuance of common stock under employee stock purchase plan | 56 | (44,909 | ) | 102 | 91 | ||||||||||
| Repurchase of common stock for payment of statutory taxes due on equity-based compensation | — | (912 | ) | (1,235 | ) | (456 | ) | ||||||||
| Net cash used by financing activities | 56 | (9,954 | ) | (1,133 | ) | (10,365 | ) | ||||||||
| Effect of exchange rate changes on cash | (735 | ) | 344 | (525 | ) | 37 | |||||||||
| Net increase (decrease) in cash and cash equivalents | 32,167 | 19,801 | 41,162 | (7,652 | ) | ||||||||||
| Cash, cash equivalents and restricted cash, beginning of period | 149,610 | 52,359 | 140,615 | 79,812 | |||||||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 181,777 | $ | 72,160 | $ | 181,777 | $ | 72,160 | |||||||
| Supplemental disclosure of cash flow information: | |||||||||||||||
| Cash paid (received) during the period for: | |||||||||||||||
| Income taxes | $ | 18 | $ | (16 | ) | $ | 18 | $ | (43 | ) | |||||
| Interest | $ | 87 | $ | 258 | $ | 232 | $ | 647 | |||||||
| Matrix Service Company Results of Operations (In thousands) | |||||||||||||||||||
| Storage and Terminal Solutions | Utility and Power Infrastructure | Process and Industrial Facilities | Corporate | Total | |||||||||||||||
| Three Months Ended December 31, 2024 | |||||||||||||||||||
| Total revenue (1) | $ | 95,507 | $ | 61,076 | $ | 30,586 | $ | — | $ | 187,169 | |||||||||
| Cost of revenue | (88,235 | ) | (57,667 | ) | (30,216 | ) | (159 | ) | (176,277 | ) | |||||||||
| Gross profit (loss) | 7,272 | 3,409 | 370 | (159 | ) | 10,892 | |||||||||||||
| Selling, general and administrative expenses | 5,567 | 3,561 | 1,677 | 6,481 | 17,286 | ||||||||||||||
| Operating income (loss) | $ | 1,705 | $ | (152 | ) | $ | (1,307 | ) | $ | (6,640 | ) | $ | (6,394 | ) | |||||
| (1) Total revenues are net of inter-segment revenues which are primarily Process and Industrial Facilities and were | |||||||||||||||||||
| Storage and Terminal Solutions | Utility and Power Infrastructure | Process and Industrial Facilities | Corporate | Total | |||||||||||||||
| Three Months Ended December 31, 2023 | |||||||||||||||||||
| Total revenue (1) | $ | 62,360 | $ | 40,144 | $ | 71,305 | $ | 1,233 | $ | 175,042 | |||||||||
| Cost of revenue | (60,522 | ) | (38,729 | ) | (64,634 | ) | (568 | ) | (164,453 | ) | |||||||||
| Gross profit | 1,838 | 1,415 | 6,671 | 665 | 10,589 | ||||||||||||||
| Selling, general and administrative expenses | 4,338 | 1,978 | 2,206 | 7,209 | 15,731 | ||||||||||||||
| Operating income (loss) | $ | (2,500 | ) | $ | (563 | ) | $ | 4,465 | $ | (6,544 | ) | $ | (5,142 | ) | |||||
| (1) Total revenues are net of inter-segment revenues which are primarily Storage and Terminal Solutions and were | |||||||||||||||||||
| Storage and Terminal Solutions | Utility and Power Infrastructure | Process and Industrial Facilities | Corporate | Total | |||||||||||||||
| Six Months Ended December 31, 2024 | |||||||||||||||||||
| Total revenue (1) | $ | 173,746 | $ | 116,988 | $ | 62,014 | $ | — | $ | 352,748 | |||||||||
| Cost of revenue | (161,777 | ) | (112,272 | ) | (59,647 | ) | (347 | ) | (334,043 | ) | |||||||||
| Gross profit (loss) | 11,969 | 4,716 | 2,367 | (347 | ) | 18,705 | |||||||||||||
| Selling, general and administrative expenses | 11,136 | 7,537 | 3,443 | 13,750 | 35,866 | ||||||||||||||
| Operating income (loss) | $ | 833 | $ | (2,821 | ) | $ | (1,076 | ) | $ | (14,097 | ) | $ | (17,161 | ) | |||||
| (1) Total revenues are net of inter-segment revenues which are primarily Process and Industrial Facilities and were | |||||||||||||||||||
| Storage and Terminal Solutions | Utility and Power Infrastructure | Process and Industrial Facilities | Corporate | Total | |||||||||||||||
| Six Months Ended December 31, 2023 | |||||||||||||||||||
| Total revenue (1) | $ | 152,504 | $ | 72,539 | $ | 146,425 | $ | 1,233 | $ | 372,701 | |||||||||
| Cost of revenue | (145,714 | ) | (67,428 | ) | (134,676 | ) | (2,435 | ) | (350,253 | ) | |||||||||
| Gross profit (loss) | 6,790 | 5,111 | 11,749 | (1,202 | ) | 22,448 | |||||||||||||
| Selling, general and administrative expenses | 8,967 | 3,526 | 5,293 | 15,058 | 32,844 | ||||||||||||||
| Operating income (loss) | $ | (2,177 | ) | $ | 1,585 | $ | 6,456 | $ | (16,260 | ) | $ | (10,396 | ) | ||||||
| (1) Total revenues are net of inter-segment revenues which are primarily Storage and Terminal Solutions and were | |||||||||||||||||||
Backlog
We define backlog as the total dollar amount of revenue that we expect to recognize as a result of performing work that has been awarded to us through a signed contract, limited notice to proceed or other type of assurance that we consider firm. The following arrangements are considered firm:
- fixed-price awards;
- minimum customer commitments on cost plus arrangements; and
- certain time and material arrangements in which the estimated value is firm or can be estimated with a reasonable amount of certainty in both timing and amounts.
For long-term maintenance contracts with no minimum commitments and other established customer agreements, we include only the amounts that we expect to recognize as revenue over the next 12 months. For arrangements in which we have received a limited notice to proceed, we include the entire scope of work in our backlog if we conclude that the likelihood of the full project proceeding as high. For all other arrangements, we calculate backlog as the estimated contract amount less revenue recognized as of the reporting date.
Three Months Ended December 31, 2024
The following table provides a summary of changes in our backlog for the three months ended December 31, 2024:
| Storage and Terminal Solutions | Utility and Power Infrastructure | Process and Industrial Facilities | Total | ||||||||||||
| (In thousands) | |||||||||||||||
| Backlog as of September 30, 2024 | $ | 801,667 | $ | 358,150 | $ | 252,054 | $ | 1,411,871 | |||||||
| Project awards | 32,826 | 21,442 | 36,270 | 90,538 | |||||||||||
| Other adjustment | — | — | (4,106 | ) | (4,106 | ) | |||||||||
| Revenue recognized | (95,507 | ) | (61,076 | ) | (30,586 | ) | (187,169 | ) | |||||||
| Backlog as of December 31, 2024 | $ | 738,986 | $ | 318,516 | $ | 253,632 | $ | 1,311,134 | |||||||
| Book-to-bill ratio (1) | 0.3x | 0.4x | 1.2x | 0.5x | |||||||||||
______________________
(1) Calculated by dividing project awards by revenue recognized.
(2) Backlog was reduced as a result of the closure of a customer's facility. This customer has historically represented less than
Six Months Ended December 31, 2024
The following table provides a summary of changes in our backlog for the six months ended December 31, 2024:
| Storage and Terminal Solutions | Utility and Power Infrastructure | Process and Industrial Facilities | Total | |||||||||||||
| (In thousands) | ||||||||||||||||
| Backlog as of June 30, 2024 | $ | 798,255 | $ | 379,697 | $ | 251,521 | $ | 1,429,473 | ||||||||
| Project awards | 114,477 | 55,807 | 68,231 | 238,515 | ||||||||||||
| Other adjustment | — | — | (4,106 | ) | (4,106 | ) | ||||||||||
| Revenue recognized | (173,746 | ) | (116,988 | ) | (62,014 | ) | (352,748 | ) | ||||||||
| Backlog as of December 31, 2024 | $ | 738,986 | $ | 318,516 | $ | 253,632 | $ | 1,311,134 | ||||||||
| Book-to-bill ratio (1) | 0.7x | 0.5x | 1.1x | 0.7x | ||||||||||||
______________________
(1) Calculated by dividing project awards by revenue recognized.
(2) Backlog was reduced as a result of the closure of a customer's facility. This customer has historically represented less than
Non-GAAP Financial Measures
Adjusted Net Loss
We have presented Adjusted net loss, which we define as Net loss before gain on sale of assets, and the tax impact of these adjustments, because we believe it better depicts our core operating results. We believe that the line item on our Consolidated Statements of Income entitled “Net loss” is the most directly comparable GAAP measure to Adjusted net loss. Since Adjusted net loss is not a measure of performance calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, Net loss as an indicator of operating performance. Adjusted net loss, as we calculate it, may not be comparable to similarly titled measures employed by other companies. In addition, this measure is not a measure of our ability to fund our cash needs. As Adjusted net loss excludes certain financial information compared with Net loss, the most directly comparable GAAP financial measure, users of this financial information should consider the type of events and transactions that are excluded. Our non-GAAP performance measure, Adjusted net loss, has certain material limitations as follows:
- It does not include gain on the sale of assets. While these sales occurred outside the normal course of business, any measure that excludes this gain has inherent limitations since the sales resulted in material inflows of cash.
A reconciliation of Net loss to Adjusted net loss follows:
Reconciliation of Net Loss to Adjusted Net Loss
(In thousands, except per share data)
| Three Months Ended | Six Months Ended | |||||||||||||||
| December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | |||||||||||||
| Net loss, as reported | $ | (5,533 | ) | $ | (2,851 | ) | $ | (14,756 | ) | $ | (6,018 | ) | ||||
| Gain on sale of assets(1) | — | (2,006 | ) | — | (4,542 | ) | ||||||||||
| Tax impact of adjustments and other net tax items(2) | — | — | — | — | ||||||||||||
| Adjusted net loss | $ | (5,533 | ) | $ | (4,857 | ) | $ | (14,756 | ) | $ | (10,560 | ) | ||||
| Loss per fully diluted share, as reported | $ | (0.20 | ) | $ | (0.10 | ) | $ | (0.53 | ) | $ | (0.22 | ) | ||||
| Adjusted loss per fully diluted share | $ | (0.20 | ) | $ | (0.18 | ) | $ | (0.53 | ) | $ | (0.39 | ) | ||||
______________________
(1) In fiscal 2024, we sold our Burlington, ON office in the first quarter and recorded a gain of
(2) Represents the tax impact of the adjustments to Net loss, calculated using the applicable effective tax rate of the adjustment. Due to the existence of valuation allowances on our deferred tax assets and net operating losses, there was no tax impact of any of the adjustments in any period presented.
Adjusted EBITDA
We have presented Adjusted EBITDA, which we define as net loss before gain on sale of assets, stock-based compensation, interest expense, interest income, income taxes, and depreciation and amortization, because it is used by the financial community as a method of measuring our performance and of evaluating the market value of companies considered to be in similar businesses. We believe that the line item on our Consolidated Statements of Income entitled “Net loss” is the most directly comparable GAAP measure to Adjusted EBITDA. Since Adjusted EBITDA is not a measure of performance calculated in accordance with GAAP, it should not be considered in isolation of, or as a substitute for, net earnings as an indicator of operating performance. Adjusted EBITDA, as we calculate it, may not be comparable to similarly titled measures employed by other companies. In addition, this measure is not a measure of our ability to fund our cash needs. As Adjusted EBITDA excludes certain financial information compared with net loss, the most directly comparable GAAP financial measure, users of this financial information should consider the type of events and transactions that are excluded. Our non-GAAP performance measure, Adjusted EBITDA, has certain material limitations as follows:
- It does not include interest expense. Because we have borrowed money to finance our operations and to acquire businesses, pay commitment fees to maintain our senior secured revolving credit facility, and incur fees to issue letters of credit under the senior secured revolving credit facility, interest expense is a necessary and ongoing part of our costs and has assisted us in generating revenue. Therefore, any measure that excludes interest expense has material limitations.
- It does not include interest income. Because we have money invested in money market depository accounts and we will have earned interest income on these investments, any measure that excludes interest income has material limitations.
- It does not include income taxes. Because the payment of income taxes is a necessary and ongoing part of our operations, any measure that excludes income taxes has material limitations.
- It does not include depreciation or amortization expense. Because we use capital and intangible assets to generate revenue, depreciation and amortization expense is a necessary element of our cost structure. Therefore, any measure that excludes depreciation or amortization expense has material limitations.
- It does not include gain on asset sales. While these sales occurred outside the normal course of business and are not expected to be recurring, any measure that excludes this gain has inherent limitations since the sale resulted in a material inflow of cash.
- It does not include equity-settled stock-based compensation expense. Stock-based compensation represents material amounts of equity that are awarded to our employees and directors for services rendered. While the expense is non-cash, we historically release vested shares out of our treasury stock, which has been replenished by using cash to periodically repurchase our stock. Therefore, any measure that excludes stock-based compensation has material limitations.
A reconciliation of Net loss to Adjusted EBITDA follows:
| Reconciliation of Net Loss to Adjusted EBITDA (In thousands) | |||||||||||||||
| Three Months Ended | Six Months Ended | ||||||||||||||
| December 31, 2024 | December 31, 2023 | December 31, 2024 | December 31, 2023 | ||||||||||||
| (in thousands) | |||||||||||||||
| Net loss | $ | (5,533 | ) | $ | (2,851 | ) | $ | (14,756 | ) | $ | (6,018 | ) | |||
| Interest expense | 145 | 319 | 234 | 644 | |||||||||||
| Interest income(1) | (1,578 | ) | (162 | ) | (3,150 | ) | (312 | ) | |||||||
| Provision (benefit) for federal, state and foreign income taxes | 16 | 6 | 16 | 6 | |||||||||||
| Depreciation and amortization | 2,510 | 2,781 | 5,025 | 5,692 | |||||||||||
| Gain on sale of assets(2) | — | (2,006 | ) | — | (4,542 | ) | |||||||||
| Stock-based compensation(3) | 2,257 | 2,030 | 4,568 | 3,785 | |||||||||||
| Adjusted EBITDA | $ | (2,183 | ) | $ | 117 | $ | (8,063 | ) | $ | (745 | ) | ||||
______________________
(1) Beginning with fiscal 2024, to be more consistent with our peers, we updated our calculation methodology of adjusted EBITDA to include interest income, prior periods have been adjusted to the new methodology.
(2) In fiscal 2024, we sold our Burlington, ON office in the first quarter and recorded a gain of
3) Represents only the equity-settled portion of our stock-based compensation expense.
FAQ
What was Matrix Service Company's (MTRX) Q2 FY2025 revenue growth?
How much backlog does MTRX have as of December 31, 2024?
What is MTRX's current liquidity position?
Why did MTRX revise its FY2025 revenue forecast?
What was MTRX's Q2 FY2025 earnings per share?
