Matrix Service Company · NASDAQ:MTRX
Matrix Service — Q2 2023 Earnings Presentation
29 slides from Matrix Service's earnings presentation, Feb 9, 2023
Slide 1: FY23 Q2 Results: Fiscal 2023 Second Quarter Presentation
FY23 Q2 RESULTS FISCAL 2023 SECOND QUARTER PRESENTATION 1
Slide 2: Safe Harbor
SAFE HARBOR This presentation contains certain forward-looking statements concerning Matrix Service Company’s operations, economic performance and management’s best judgment as to what may occur in the future. The actual results for the current and future periods and other corporate developments wil
Slide 3: Safety Moment: Driving in the Rain
SAFETY MOMENT DRIVING IN THE RAIN. Nearly 600,000 crashes a year PREPARE YOUR CAR. are caused by rain and 3,000 people are killed in rain- related accidents, according to the Federal Highway • Windshield wipers: Check your windshield wipers to make sure they are in good condition. If the Administrat
Slide 4: About Matrix
ABOUT MATRIX 4
Slide 5: About Matrix Service Company
ABOUT MATRIX SERVICE COMPANY Matrix is a top tier North American industrial engineering and construction contractor committed to delivering the highest quality work – safely, on time and on budget. OUR PURPOSE We build a brighter future, improve quality of life, and create long-term value for our pe
Slide 6: Our Core Values Are the Foundation of Our Success
OUR CORE VALUES ARE THE FOUNDATION OF OUR SUCCESS Our commitment has led to consistent recognition for excellence by our clients, our industry, the business world, and our employees Commitment to safety Put safety first for yourself and others. Create a zero-incident environment through leadership.
Slide 7: Our Expertise | Reporting Segments
OUR EXPERTISE | REPORTING SEGMENTS TOP-TIER SOLUTIONS IN CAPITAL PROJECTS, TURNAROUNDS, MAINTENANCE AND REPAIR SERVICES. PROCESS AND INDUSTRIAL FACILITIES • Midstream natural gas • Renewables/biofuels • Mining and minerals • Chemical/petrochemical • Aerospace • Refineries • Fertilizer • Industrial f
Slide 8: Financial Update
FINANCIAL UPDATE 8
Slide 9: Overall Assessment
OVERALL ASSESSMENT UTILITY AND POWER INFRASTRUCTURE FY2023 Q2 was shaping up to be in line with • Gross margin was at its highest since FY2021 expectations: • Segment returned to positive operating income with the best performance since FY2021 Q2 • Project award activity was strong across all three
Slide 10: Quarterly Trend | Consolidated
QUARTERLY TREND | CONSOLIDATED (In millions except %) FY2022, Q1 FY2022, Q2 FY2022, Q3 FY2022, Q4 FY2023, Q1 FY2023, Q2 Revenue $ 168,093 $ 161,965 $177,003 $200,719 $208,431 $193,040 Gross Profit (Loss) (3,508) 3,207 (1,763) 858 13,008 (1,302) Gross Margin (2.1%) 2.0% (1.0%) 0.4% 6.2% (0.7%) SG&A E
Slide 11: Cash Bridge | FY2023 Q2
CASH BRIDGE | FY2023 Q2 ($ in millions) Cash improvement in FY 2023, Q2 was driven by receipt of upfront payments from capital project customers. We continue to proactively manage our balance sheet and liquidity. 11
Slide 12: Highlights for FY2023, Q2
HIGHLIGHTS FOR FY2023, Q2 Project Awards ($ millions) Continued Momentum in Project Awards 1 $319 • Sixth consecutive quarter with a book-to-bill 1.0 or $267 $235 higher $192 $196 $115 $108 $180 • Continued uptick in larger Storage and Terminal $112 $138 $48 $52 $62 $132 $105 $99 projects, with addi
Slide 13: Strategy and Opportunity Pipeline
STRATEGY AND OPPORTUNITY PIPELINE 13
Slide 14: Market Strategy
MARKET STRATEGY Strengthen the Core Expand in existing end markets Grow into new end markets Crude tanks and terminals LNG and NGL storage terminals Renewable energy infrastructure such Refining Midstream gas processing as Hydrogen and biofuels Thermal vacuum chambers Chemical and Petrochemical Elec
Slide 15: Positioning and Execution
POSITIONING AND EXECUTION Prepared to Execute and Deliver Results • Organization has built an execution infrastructure, streamlined its supporting cost structure and optimized our business processes to make sure we are positioned to execute on the opportunities and award cycle we see ahead. • Intern
Slide 16: Our Storage Evolution
OUR STORAGE EVOLUTION The Matrix brand is synonymous with best-in-class storage solutions. Generating 60-70% of our revenue, most of our storage projects today are for complex cryogenic storage, supporting the transition to clean energy. FROM TO ATMOSPHERIC FLAT BOTTOM COMPLEX SINGLE AND DOUBLE-WALL
Slide 17: Our Cryogenic Expertise
OUR CRYOGENIC EXPERTISE With 65+ years of expertise in the design, integration, and implementation of advanced technologies, Matrix is a leader in complex cryogenic infrastructure, supporting critical market drivers: Global energy security, Domestic energy supply and distribution assurance, and Clea
Slide 18: Growing Capital Projects Opportunity Pipeline
GROWING CAPITAL PROJECTS OPPORTUNITY PIPELINE Pipeline supports transition to a lower carbon energy mix, especially in LNG and NGLs, Hydrogen and other renewables The largest opportunities in the opportunity pipeline are in Storage and Terminal Hydrogen and other LNG and NGL renewables Solutions. Ma
Slide 19: Transitioning to a Lower Carbon Energy Mix
TRANSITIONING TO A LOWER CARBON ENERGY MIX Enterprise-wide, our skills and expertise are transferable as the world and our clients transition to a lower carbon energy mix. NATURAL GAS LNG The engineering disciplines and world-class construction crews that established our leading brand in crude stora
Slide 20: Select Near Term Project Opportunities | Over $15M
SELECT NEAR TERM PROJECT OPPORTUNITIES | OVER $15M UTILITIES AND POWER INFRASTRUCTURE PROCESS & INDUSTRIAL FACILITIES STORAGE & TERMINAL SOLUTIONS Natural Gas and Electrical Utility Client Natural Gas Distribution Utility Client Liquids Terminaling Client LNG Peakshaver and Full Containment Tank Com
Slide 21: Why Matrix Is a Good Long-Term Investment
WHY MATRIX IS A GOOD LONG-TERM INVESTMENT Economic and market drivers bring significant tailwinds Growth prospects with strong opportunity pipeline in end KEY FINANCIAL TARGETS* markets with long runway < 6% < 6% Organization infrastructure created to address this pipeline, with Net Working SG&A tar
Slide 22: Appendix
APPENDIX MATRIX SERVICE COMPANY 22
Slide 23: Quarterly Trend | Utility & Power Infrastructure
QUARTERLY TREND | UTILITY & POWER INFRASTRUCTURE (In millions except %) FY2022, Q1 FY2022, Q2 FY2022, Q3 FY2022, Q4 FY2023, Q1 FY2023, Q2 Revenue $ 57,204 $ 54,752 $ 59,341 $ 48,795 $ 44,870 $50,535 Gross Profit (Loss) (6,107) (491) (492) (1,497) 1,714 2,426 Gross Margin (10.7%) (0.9%) (0.8%) (3.1%)
Slide 24: Quarterly Trend | Process & Industrial Facilities
QUARTERLY TREND | PROCESS & INDUSTRIAL FACILITIES (In millions except %) FY2022, Q1 FY2022, Q2 FY2022, Q3 FY2022, Q4 FY2023, Q1 FY2023, Q2 Revenue $ 43,905 $ 50,316 $ 68,971 $ 91,656 $ 86,628 $80,789 Gross Profit (Loss) 2,871 4,235 (441) 2,607 4,330 (5,131) Gross Margin 6.5% 8.4% (0.6%) 2.8% 5.0% (6
Slide 25: Quarterly Trend | Storage & Terminal Solutions
QUARTERLY TREND | STORAGE & TERMINAL SOLUTIONS (In millions except %) FY2022, Q1 FY2022, Q2 FY2022, Q3 FY2022, Q4 FY2023, Q1 FY2023, Q2 Revenue $ 66,984 $ 56,887 $ 48,691 $ 60,268 $ 76,933 $62,516 Gross Profit (Loss) 413 (172) (458) 478 7,564 1,648 Gross Margin 0.6% (0.3%) (0.9%) 0.8% 9.8% 2.6% SG&A
Slide 26: Adjusted EBITDA
ADJUSTED EBITDA THREE MONTHS ENDED SIX MONTHS ENDED December 31, December 31, December 31, December 31, 2022 2021 2022 2021 Net Income (Loss), as reported $ (32,827) $ (24,919) $ (39,339) $ (42,457) Goodwill Impairment 12,316 _ 12,316 _ Restructuring Costs 1,278 695 2,565 1,300 Stock-Based Compensat
Slide 27: Reconciliation of Certain Non-GAAP Measures
RECONCILIATION OF CERTAIN NON-GAAP MEASURES THREE MONTHS ENDED SIX MONTHS ENDED December 31, December 31, December 31, December 31, 2022 2021 2022 2021 Net Income (Loss), as reported $ (32,827) $ (24,919) $ (39,339) $ (42,457) Goodwill Impairment 12,316 _ 12,316 _ Restructuring Costs 1,278 695 2,565
Slide 28: Reconciliation of Certain Non-GAAP Measures
RECONCILIATION OF CERTAIN NON-GAAP MEASURES THREE MONTHS ENDED DECEMBER 31, 2022 Utility and Process and Storage and Power Industrial Terminal Corporate Total Infrastructure Facilities Solutions Total Operating Income (Loss) $ 639 $ (21,511) $ (4,185) $ (7,384) $ (32,441) Goodwill Impairment _ 12,31
Slide 29: Reconciliation of Certain Non-GAAP Measures
RECONCILIATION OF CERTAIN NON-GAAP MEASURES SIX MONTHS ENDED DECEMBER 31, 2022 Utility and Process and Storage and Power Industrial Terminal Corporate Total Infrastructure Facilities Solutions Total Operating Income (Loss) $ 577 $ (21,565) $ (1,301) $ (15,242) $ (37,531) Goodwill Impairment _ 12,316
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