Southland JV Executes Contract to Deliver the Winnipeg North End Treatment Plant Biosolids Facilities Upgrade Project

Rhea-AI Summary

Southland Holdings, Inc. (NYSE American: SLND) announced that its joint venture, Red River Biosolids Partners General Partnership, has executed a contract with the City of Winnipeg for the North End Sewage Treatment Plant Biosolids Facilities Upgrade project. The joint venture includes Southland's subsidiary, Oscar Renda Contracting of Canada Inc., Aecon Group Inc. (TSX: ARE), and MWH Constructors Canada

The project begins with a development phase contract valued at approximately $70 million USD, of which Southland holds a 33.3% share. This will be added to Southland's backlog in Q3 2024. The scope includes designing and constructing a new biosolids facility and modifying existing primary clarification. The North End Sewage Treatment Plant provides 70% of Winnipeg's wastewater treatment capacity.

Positive

• Secured a new contract for a major infrastructure project
• Development phase contract valued at approximately $70 million USD
• Southland holds a 33.3% share of the contract
• Contract to be added to backlog in Q3 2024
• Potential for additional work in the implementation phase

Negative

• None.

Insights

Environmental Engineering Expert

This contract execution marks a significant milestone for Southland Holdings and its joint venture partners. The $70 million USD development phase for the Winnipeg North End Treatment Plant Biosolids Facilities Upgrade project demonstrates a substantial commitment to improving wastewater infrastructure. The project's scope, including a new biosolids facility and modifications to existing primary clarification, addresses critical environmental and public health needs.

The Progressive Design-Build contract model allows for collaborative optimization of design and costs, potentially leading to more efficient project delivery. Southland's 33.3% share in the development phase adds approximately $23.3 million to its backlog, strengthening its project pipeline. This, combined with their involvement in the NEWPCC Headworks Facilities Upgrade, positions Southland as a key player in Winnipeg's wastewater infrastructure modernization.

The project's focus on the largest sewage treatment plant in Winnipeg, handling 70% of the city's wastewater treatment capacity, underscores its importance. Successful execution could lead to improved environmental outcomes and potentially open doors for similar large-scale projects in the future.

Financial Analyst

This contract execution is a positive development for Southland Holdings (SLND). The $70 million USD development phase, with Southland's 33.3% share translating to about $23.3 million, will bolster the company's backlog in Q3 2024. This provides improved revenue visibility and potentially supports near-term stock performance.

The Progressive Design-Build model could lead to margin improvements if the joint venture optimizes costs effectively during the development phase. Moreover, successful completion of this phase could pave the way for a larger implementation contract, further enhancing Southland's long-term revenue prospects.

Investors should note that this project, along with Southland's involvement in the NEWPCC Headworks Facilities Upgrade, strengthens the company's position in the Canadian infrastructure market. This geographical and project type diversification may help mitigate risks and provide more stable revenue streams. However, the full financial impact will depend on the successful transition to and execution of the implementation phase.

GRAPEVINE, Texas--(BUSINESS WIRE)-- Southland Holdings, Inc. (NYSE American: SLND and SLND WS) (“Southland”) announced today that Red River Biosolids Partners General Partnership, a joint venture comprised of a Southland subsidiary, Oscar Renda Contracting of Canada Inc., Aecon Group Inc. (TSX: ARE), and MWH Constructors Canada Ltd. has executed a contract with the City of Winnipeg to deliver the Winnipeg North End Sewage Treatment Plant (“NEWPCC”) Biosolids Facilities Upgrade project under a Progressive Design-Build contract model.

The collaborative project begins with a development phase contract valued at approximately $70 million USD to advance design and finalize the scope and cost of various elements of the project. Southland holds a 33.3% share of the development phase contract which will be added to its backlog in the third quarter of 2024. Upon successful completion of this phase, the implementation phase will begin to finalize the design and execute construction.

The scope of work includes the design and construction of a new biosolids facility, as well as modifications to the existing primary clarification. NEWPCC provides 70% of Winnipeg’s wastewater treatment capacity and is the largest sewage treatment plant in the city. Southland is also currently working with Aecon and the City of Winnipeg to deliver the NEWPCC Headworks Facilities Upgrade project.

Further information about the project is available on the City of Winnipeg’s website.

About Southland

Southland is a leading provider of specialized infrastructure construction services. With roots dating back to 1900, Southland and its subsidiaries form one of the largest infrastructure construction companies in North America, with experience throughout the world. The company serves the bridges, tunneling, communications, transportation and facilities, marine, steel structures, water and wastewater treatment, and water pipeline end markets. Southland is headquartered in Grapevine, Texas. For more information, please visit Southland’s website at www.southlandholdings.com.

Forward-Looking Statements

This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on Southland’s current beliefs, expectations and assumptions regarding the future of Southland’s business, future plans and strategies, projections, anticipated events and trends, the economy and other future conditions. Because forward-looking statements relate to the future, they are subject to inherent uncertainties, risks and changes in circumstances that are difficult to predict and many of which are outside of Southland’s control. Southland’s actual results and financial condition may differ materially from those indicated in the forward-looking statements. Therefore, you should not rely on any of these forward-looking statements. Any forward-looking statement made by Southland in this press release is based only on information currently available to Southland and speaks only as of the date on which it is made. Southland undertakes no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.

View source version on businesswire.com: https://www.businesswire.com/news/home/20241002594643/en/

Alex Murray

Corporate Development & Investor Relations

amurray@southlandholdings.com

Source: Southland Holdings, Inc.

FAQ

What is the value of the Winnipeg North End Treatment Plant contract for Southland Holdings (SLND)?

Southland Holdings (SLND) has a 33.3% share of the development phase contract valued at approximately $70 million USD for the Winnipeg North End Treatment Plant Biosolids Facilities Upgrade project.

When will the Winnipeg North End Treatment Plant contract be added to Southland Holdings' (SLND) backlog?

The contract for the Winnipeg North End Treatment Plant project will be added to Southland Holdings' (SLND) backlog in the third quarter of 2024.

What is the scope of work for the Winnipeg North End Treatment Plant project involving Southland Holdings (SLND)?

The scope of work for Southland Holdings (SLND) in the Winnipeg North End Treatment Plant project includes the design and construction of a new biosolids facility, as well as modifications to the existing primary clarification.

Who are Southland Holdings' (SLND) partners in the Winnipeg North End Treatment Plant project?

Southland Holdings (SLND) is partnering with Aecon Group Inc. (TSX: ARE), MWH Constructors Canada , and its own subsidiary Oscar Renda Contracting of Canada Inc. in the Red River Biosolids Partners General Partnership for this project.