Slide 1: Willdan Group Investor Presentation June 2014
Willdan Group Investor Presentation June 2014 NASDAQ: WLDN www.willdan.com
Slide 2: Safe Harbor Statement
Safe Harbor Statement Statements in this presentation that are not purely historical, including statements regarding Willdan Group, Inc.’s (“Willdan”) intentions, hopes, beliefs, expectations, representations, projections, estimates, plans or predictions of the future are forward-looking statements
Slide 3: Who We Are
Who We Are Founded in 1964; headquartered in Anaheim, CA Nationwide provider of professional technical and consulting services Public and private agencies and utilities ~600 employees ~2,000 projects underway for ~1,000 clients LTM revenue of $87 million LTM net income of $3.6 million Strong balance
Slide 4: Successful Business Diversification
Successful Business Diversification 4 Willdan IPO Intergy Acquisition Goodwill Impairment Self Perform / Install Revenue by Segment $ in millions Pass through Total revenues $67.2 $78.4 $73.3 $78.9 $61.1 $77.9 $107.2 $93.4 $85.5
Slide 5: Expanded Geographic Footprint
Expanded Geographic Footprint 5
Slide 6: Engineering/Infrastructure Services
Engineering/Infrastructure Services 6 Engineering Services Building and Safety City Engineering Code Enforcement Development Review Disaster Recovery Environmental Engineering Geotechnical Landscape Architecture Planning Program and Construction Management Contract Staff Support Services Structures
Slide 7: Engineering Projects
Engineering Projects 7 City of Paramount, City Engineer Los Angeles County, California The City of Elk Grove Sacramento County, California Providing capital improvement project management; street sweeping services; development review; drainage investigation, studies and design; LED street light conv
Slide 8: Engineering/Infrastructure Services: Infrastructure Services
Engineering/Infrastructure Services Infrastructure Services Focus on large-scale, high-value projects Initial work on California High Speed Rail Working under limited Notice to Proceed with focus on preliminary engineering Bidding on the next 2 segments with Tutor Perini-Parsons Next segments to be
Slide 9: Infrastructure Project Highlights
Infrastructure Project Highlights 9 Los Angeles County Metropolitan Transportation Authority, Orange Line Extension Design-Build Los Angeles County, California California High Speed Rail
Slide 10: Engineering/Infrastructure Projects
Engineering/Infrastructure Projects 10 California High Speed Rail Authority Engineering design as part of joint venture with Tutor Perini-Parsons on the first segment of this $68 billion project, which is a 520-mile network linking San Francisco and Los Angeles City of Elk Grove Community of more th
Slide 11: Energy Efficiency Services
Energy Efficiency Services Formed division following acquisition of Intergy Corporation in 2008 Services include consulting and engineering services to reduce energy consumption and client costs Markets Clients Education Consolidated Edison Co. of New York Data Centers NY State Energy Research & Dev
Slide 12: Energy Efficiency Project Highlights
San Diego Gas & Electric (SDG&E) Lodging Energy Efficiency Program Southern California California Edison (SCE) Schools Energy Efficiency Program SoCal Edison Energy Efficiency Project Highlights 12 New York State Energy Research and Development Authority (NYSERDA) Programs Consolidated Edison of New
Slide 13: Energy Efficiency Projects
Energy Efficiency Projects 13 Consolidated Edison Company of New York Puget Sound Energy New York State Energy Research & Development Authority (NYSERDA) Pacific Gas & Electric (PG&E), Southern California Edison (SCE), San Diego Gas & Electric (SDG&E) SCE and SDG&E Program manager and implementer fo
Slide 14: Public Finance Services
Public Finance Services Customized Administration Services Assessment, landscaping and lighting and community facilities Financial Consulting Economic analysis and financial projects for public agencies Federal Compliance Services to issuer of municipal securities 14 Convention Center Facilities Dis
Slide 15: Public Finance Services Projects
Public Finance Services Projects 15 Metropolitan Washington Airport Authority MWAA (DC) Economic impact study for passenger, freight and capital development activity at Washington Dulles International Airport and Ronald Reagan Washington National Airport City of Kalispell, Montana Market and feasibi
Slide 16: Homeland Security Services
Homeland Security Services Preparedness planning, emergency preparedness training, communication and technology and water security services Projects New York Mass Transit Authority Training Program (NY MTA) Contracted in 2012 by the largest public transportation provider in the western hemisphere to
Slide 17: Homeland Security Projects
Homeland Security Projects 17 New York State Metropolitan Transit Authority (NYSMTA) Developing and delivering advanced security and emergency response courses and workshops Bay Area Urban Area Security Initiative Training Services Provides a wide range of training courses in the law enforcement, fi
Slide 18: Experienced Management
Years of Industry Experience Years with Company Win Westfall, Chairman of the Board 40+ 13 Tom Brisbin, President and Chief Executive Officer 35+ 7 Marc Tipermas, President of National Programs 30+ 7 Stacy McLaughlin, Chief Financial Officer 10+ 4 Frank G. Tripepi, Senior Vice President, Business De
Slide 19: Three-Year Financial Performance
Three-Year Financial Performance 19 $ in millions Revenue, net of Subcontract Costs* Net Income** Adjusted EBITDA*** Cash Flow from Operations * Revenues, net of subcontractor costs, a non-GAAP financial measure, is a supplemental measure that Willdan believes enhances investors' ability to analyze
Slide 20: Strong Start to 2014
Strong Start to 2014 20 $ in millions * Revenues, net of subcontractor costs," a non-GAAP financial measure, is a supplemental measure that Willdan believes enhances investors' ability to analyze our business trend and performance because it substantially measures the work performed by our employees
Slide 21: Balance Sheet Highlights
Balance Sheet Highlights No Debt Revolving bank loan of $7.5 million No outstanding borrowings 21 Cash and Equivalents $12.7 $8.1
Slide 22: Acquisition Strategy
Acquisition Strategy Strong balance sheet to fund strategy Target small tuck-in acquisitions Expand geographic footprint Broaden service offerings Past success Grew $8 million acquisition in 2008 to $36 million Energy Efficiency Services business in 2013 22
Slide 23: Positioned for Long-Term Profitable Growth
Positioned for Long-Term Profitable Growth 23 Capitalize on growing interest in outsourcing Target larger and longer-term opportunities Enter new geographic markets Expand service offerings Pursue strategic acquisitions Leverage cross-selling opportunities Manage profitability at the project level C
Slide 24: Three-year Financial Targets
Three-year Financial Targets Annual contract revenue growth of up to 15% Combined organic and acquisitive growth Gross margin of 40% to 45% Adjusted EBITDA margin of 5% to 10%* Accounts receivable days outstanding of 70 to 75 *We define Adjusted EBITDA as net income plus net interest expense, income
Slide 25: Investment Highlights
Investment Highlights 50-year history of relationships with public agencies and utilities Strong competitive position and compelling customer value proposition Diversified platform that reduces risk Exposure to attractive end markets poised for growth Pursuing clearly defined growth strategy Strong
Slide 26: Appendix GAAP Reconciliations
Appendix GAAP Reconciliations 26
Slide 27: Reconciliation of GAAP Revenue and Adjusted EBITDA (Fiscal Years)
27 Willdan Group, Inc. and Subsidiaries Reconciliation of GAAP Revenue and “Revenue, Net of Subcontractor Costs” Fiscal Year Ended December 27, December 28, December 30, 2013 2012 2011 Contract revenues $ 85,510,000 $ 93,443,000 $107,165,000 Subcontractor costs 16,840,000 36,184,000 (34,195,000) Rev
Slide 28: Reconciliation of GAAP Revenue and Adjusted EBITDA (Quarter)
28 Willdan Group, Inc. and Subsidiaries Reconciliation of GAAP Revenue and “Revenue, Net of Subcontractor Costs” Three Months Ended March 28, 2014 March 29,2013 Contract revenue $22,686,000 $ 21,385,000 Subcontractor costs 4,194,000 4,805,000 Revenue, net of subcontractor costs 18,492 000 16,580,000