L.b. Foster Company · NASDAQ:FSTR
L.b. Foster — Q1 2024 Earnings Presentation
34 slides from L.b. Foster's earnings presentation, May 7, 2024
Slide 1: L.B. Foster Company Earnings Presentation
L.B. Foster Company Earnings Presentation Nasdaq - FSTR May 7, 2024
Slide 2: Safe Harbor Disclaimer
Safe Harbor Disclaimer Safe Harbor Statement Non-GAAP Financial Measures This earnings presentation discloses the following non-GAAP measures: This presentation may contain “forward-looking” statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and Section
Slide 3: L.B. Foster Overview
L.B. Foster Overview Innovating to solve global infrastructure challenges 2024 Guidance Low High > Founded in 1902; headquartered in Pittsburgh, Pennsylvania Revenue $ 525 $ 560 > Locations throughout North America, South America, Europe, and Asia Adj. EBITDA1 $ 34 $ 39 2 > 18 principal plants and o
Slide 4: Opening Remarks
Opening Remarks John Kasel President and CEO L.B. Foster Q1 2024 Earnings Presentation 4 May 7, 2024
Slide 5: Executive Summary – Quarter Highlights
Executive Summary – Quarter Highlights What we’ve accomplished… Where we’re going… New orders1,3 of $132.4M; 2024 Guidance Net sales of $124.3M up Net income of $4.4M down YoY but up 3.0% on Reaffirmed 7.6% YoY (up 16.9% favorable $6.6M YoY an organic basis1 and up Net sales organically1) 25.5% sequ
Slide 6: Financial Review
Financial Review Bill Thalman Executive Vice President and CFO L.B. Foster Q1 2024 Earnings Presentation 6 May 7, 2024
Slide 7: First Quarter Results
First Quarter Results As of and for the quarter ended March 31, 2024: $ in millions, unless otherwise noted YoY Δ > Net sales up 16.9% organically1, partially offset by 9.2% decline from divestiture / exit activity SALES 124.3 8.8 > Gross profit up 12.7% with margins expanding GROSS PROFIT 26.2 3.0
Slide 8: Year over Year Change in Sales and Adj. EBITDA
1 Year over Year Change in Sales and Adj. EBITDA Changes to Net Sales Changes to Adjusted EBITDA1 ($ in millions) ($ in millions) $7 $150 $10.6 $6 $125 $19.5 $0.6 $5.9 $124.3 $115.5 $5 $0.8 4.8% of $100 sales1 $4.5 $4 3.9% of $75 sales1 $3 $50 $2 $25 $1 $0 $0 Q1 2023 Legacy Business Divestitures & Q
Slide 9: Sales and Gross Profit Trend – Trailing Quarters
Sales and Gross Profit Trend – Trailing 4 Quarters 1 1,2 1 Adjusted Sales and YoY Organic Growth Adjusted Gross Profit ($ in millions) $175 $40 22% 21.8% 21.5% +13% +13% 21.2% 21.1% $150 20.8% $35 20% $148 $147 +8% 20.2% $32 $137 +17% 19.5% $31 $134 $135 $125 $132 $124 $30 $29 18% Gross Profit ($ in
Slide 10: Rail, Technologies, and Services – Q1 Results
Rail, Technologies, and Services – Q1 Results Strength in domestic businesses coupled with recovery in U.K. Technology Services and Solutions Rail, Technologies Technologies, Sales GP Margin and and Services Services +28.3% +30 bps $100 25% 20% $75 15% $50 $83 22.2% 22.5% 10% $64 $25 5% $0 0% Q1 202
Slide 11: Infrastructure Solutions – Q1 Results
Infrastructure Solutions – Q1 Results Divestiture and product line exit drove sales decline and related margin improvement Infrastructure Sales GP Margin Solutions (18.4)% +80 bps $75 30% 25% $50 20% 15% $25 $51 10% 18.4% $42 17.6% 5% $0 0% Q1 2023 Q1 2024 Q1 2023 Q1 2024 > Net sales decreased by 18
Slide 12: Net Debt, Leverage, and Capital Allocation
1 Net Debt , Leverage, and Capital Allocation Net debt and leverage favorable to last year...sequential increase in line with seasonal business needs 1 1,2 > First quarter net debt1 and Gross Leverage Ratio1,2 Net Debt and Gross Leverage Ratio elevated sequentially due to seasonal working capital Pe
Slide 13: Capital Allocation Priorities
Capital Allocation Priorities Relentless pursuit of shareholder returns showing results in equity valuation Capital Allocation Investment for Growth Debt Reduction Growth Capital Expenditures 1 > Target maintaining Gross Leverage Ratio at ~2.0x; > Targeting 2.0% - 2.5% of sales to support organic gr
Slide 14: New Orders, Revenue, and Book-to-Bill Ratios
1 1 New Orders , Revenue, and Book-to-Bill Ratios Consolidated New Orders and Revenue ($ in millions) $200 $184 $150 $140 $148 $145 $135 $132 $100 $124 $115 $100 $106 $50 $0 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Total New Orders Total Revenue TTM Q1 2024 Book-to-Bill Ratio: 0.94:1.00 Rail, Technol
Slide 15: Backlog Trends
1 Backlog Trends Consolidated Backlog $300 $250 $290 $260 $243 $200 $222 $214 $150 $100 $50 $0 Q1 2023 Q2 2023 Q3 2023 Q4 2023 Q1 2024 Rail, Technologies, and Services Backlog Infrastructure Solutions Backlog $150 $175 $125 $150 $132 $158 $146 $150 $125 $136 $100 $114 $129 $94 $100 $75 $84 $86 $75 $
Slide 16: Closing Remarks
Closing Remarks John Kasel President and CEO L.B. Foster Q1 2024 Earnings Presentation 16 May 7, 2024
Slide 17: Market and Business Outlook
Market and Business Outlook L.B. Foster is well-positioned to execute on favorable demand outlook from investment super cycle Infrastructure project starts Additional focus and funding for Record spending on parks and expected to continue to expand rail safety initiatives supports camps construction
Slide 18: L.B. Foster Investment Thesis
L.B. Foster Investment Thesis Structural Improvement in Business portfolio transformation, organic growth and focused Profitability profitability initiatives manifesting in improved results Infrastructure pure play with a diverse set of avenues for Organic Growth Drivers in Place growth in multi-yea
Slide 19: Innovating to Solve Global Infrastructure Challenges
Innovating to Solve Global Infrastructure Challenges Near Term Goals (2025) REVENUE $580M - $620M GP % 22.0% - 23.0% ADJ. EBITDA1 $48M - $52M Relative Performance Chart: Russell 2000 vs FSTR Adj. EBITDA1 Margin ~8.0% Source: Google Performance range May 2023 - April 2024 L.B. Foster Q1 2024 Earnings
Slide 20: Thank you!
Thank you! L.B. Foster Q1 2024 Earnings Presentation We look forward to discussing our Q2 2024 results in early August 2024. L.B. Foster Q1 2024 Earnings Presentation 20 May 7, 2024
Slide 21: Appendix
Appendix L.B. Foster Q1 2024 Earnings Presentation 21 May 7, 2024
Slide 22: Condensed Balance Sheet - Assets
Condensed Balance Sheet - Assets Assets March 31, 2024 December 31, 2023 ($ in millions) Current assets: Cash and cash equivalents $ 3.1 $ 2.6 Accounts receivable - net 57.9 53.5 Contract assets 24.1 29.5 Inventories - net 85.8 73.5 Other current assets 12.1 9.0 Total current assets $ 183.0 $ 168.0
Slide 23: Condensed Balance Sheet – Liabilities and Equity
Condensed Balance Sheet – Liabilities and Equity Liabilities and Stockholders' Equity March 31, 2024 December 31, 2023 ($ in millions) Current liabilities: Accounts payable $ 43.4 $ 40.3 Deferred revenue 11.5 12.5 Other accrued liabilities 29.2 42.4 Current maturities of long-term debt 0.2 0.1 Total
Slide 24: Condensed Income Statement – Q1
Condensed Income Statement – Q1 Three Months Ended Three Months Ended Delta March 31, 2024 March 31, 2023 ($ in millions except per share data) $ % of Sales $ % of Sales $ % Sales $ 124.3 $ 115.5 $ 8.8 7.6 % Gross profit 26.2 21.1% 23.3 20.2% 3.0 12.7 % SG&A 22.7 18.3% 21.4 18.5% 1.3 6.2 % Amortizat
Slide 25: Condensed Cash Flows
Condensed Cash Flows Three months ended Three months ended March 31, 2024 March 31, 2023 ($ in millions) Net income and other non-cash items from operations $ 5.4 $ 3.4 Receivables (4.0) 26.2 Contract assets 5.1 (0.9) Inventory (12.4) (15.6) Payables and deferred revenue 1.4 4.2 Trade working capita
Slide 26: New Orders and Backlog
New Orders and Backlog New Orders Entered – Three Months Ended December 31, ($ in millions) March 31, 2024 March 31, 2023 YoY Delta Seq. Delta 2023 Rail, Technologies, and Services $ 83.7 $ 73.7 $ 60.1 $ 10.0 13.6 % $ 23.7 39.4 % Infrastructure Solutions 48.6 65.8 45.5 (17.1) (26.1)% 3.2 7.0 % Total
Slide 27: Segment Results – Q1
Segment Results – Q1 Three Months Ended Three Months Ended Segment Sales Delta March 31, 2024 March 31, 2023 ($ in millions) $ $ $ % Rail, Technologies, and Services $ 82.6 $ 64.4 $ 18.2 28.3 % Infrastructure Solutions 41.7 51.1 (9.4) (18.4)% Total $ 124.3 $ 115.5 $ 8.8 7.6 % Three Months Ended Thre
Slide 28: Non-GAAP Measure: Adjusted EBITDA
Non-GAAP Measure: Adjusted EBITDA Trailing twelve Three months ended March 31, months ended March 31, ($ in millions) 2024 2023 2024 Net income (loss), as reported $ 4.4 $ (2.2) $ 7.9 Interest expense - net 1.1 1.4 5.3 Income tax expense (benefit) 0.3 (0.5) 0.5 Depreciation expense 2.4 2.5 9.8 Amort
Slide 29: Non-GAAP Measure: Funding Capacity & Free Cash Flow
Non-GAAP Measure: Funding Capacity & Free Cash Flow ($ in millions) March 31, 2024 Cash and cash equivalents $ 3.1 Total availability under the credit facility 130.0 Outstanding borrowings on revolving credit facility (77.5) Letters of credit outstanding (2.4) Net availability under the revolving cr
Slide 30: Non-GAAP Measure: Net Debt
1 Non-GAAP Measure: Net Debt March 31, December 31, September 30, June 30, March 31, December 31, September 30, June 30, 2024 2023 2023 2023 2023 2022 2022 2022 ($ in millions) Total debt $ 78.1 $ 55.3 $ 71.7 $ 89.5 $ 80.1 $ 91.9 $ 98.9 $ 49.3 Less: cash and cash equivalents (3.1) (2.6) (3.0) (3.9)
Slide 31: Non-GAAP Measure: Organic Orders
Non-GAAP Measure: Organic Orders Three Months Percent Change in Consolidated Organic Orders Ended Change ($ in millions) March 31, 2023 orders, as reported $ 139.5 Decrease due to divestitures and exit (11.3) (8.1)% Change due to organic orders 4.1 3.0 % 2024 orders, as reported $ 132.4 (5.1)% L.B.
Slide 32: Non-GAAP Measure: Organic Sales
Non-GAAP Measure: Organic Sales Three Months Percent Change in Consolidated Organic Sales Ended Change ($ in millions) March 31, 2023 net sales, as reported $ 115.5 Decrease due to divestitures and exit (10.6) (9.2)% Change due to organic sales 19.5 16.9 % 2024 net sales, as reported $ 124.3 7.6 % T
Slide 33: Non-GAAP Measure: Organic Sales
Non-GAAP Measure: Organic Sales Three Months Percent Change in Consolidated Organic Sales Ended Change ($ in millions) June 30, 2022 net sales, as reported $ 131.5 Decrease due to divestitures and exit (8.9) (6.8)% Increase due to acquisitions 7.9 6.0 % Change due to organic sales 17.6 13.3 % 2023 n
Slide 34: Non-GAAP Measure: Adj. Results for Non-routine Items
Non-GAAP Measure: Adj. Results for Non-routine Items Three Months Ended ($ in millions) September 30, September 30, 2023 2022 Net sales, as reported $ 145.3 $ 130.0 Bridge grid deck exit impact 2.0 — Crossrail settlement adjustment — 4.0 Net sales, as adjusted $ 147.3 $ 134.0 Gross profit, as report