Babcock & Wilcox Enterprises, I Q1 FY2025 earnings call

• Strong start to 2025 with robust first quarter results across the entire business, driven by strong global and North American demand for technologies. • Generated strong operating results with revenue, operating income, and adjusted EBITDA exceeding company and consensus expectations. • Global parts and services business had highest Q1 bookings revenue, gross profit, and EBITDA in past decade. • Announced approximately 40% of outstanding bonds exchanged into new five-year notes at a discount to par, reducing debt, net debt, and annual interest expense. • Sold majority of assets of Denmark-based waste energy subsidiary for $20 million, with $5 million directed to fund BrightLoop project in Massillon, Ohio, and entered into agreements for North American waste energy market collaboration. • Backlog of $526.8 million at end of first quarter was 47% increase compared to same period 2024, and bookings from continued operations were $167 million, an 11% increase. • Progressing BrightLoop project, with engineering work ongoing, financing for Massillon project in progress, and anticipation of hydrogen production from Massillon plant by mid-2026. • Seeing opportunities for new renewable energy projects in US.

Consolidated revenues for the first quarter of 2025 were $181.2 million, a 10% increase compared to the first quarter of 2024. Net loss from continuing operations in the first quarter of 2025 was $7.8 million, better than the net loss of $12.8 million in the first quarter of 2024. Operating income in the first quarter of 2025 was $5.9 million, exceeding quarterly expectations, and adjusted EBITDA was $14.3 million compared to $11.3 million in the first quarter of 2024. Bookings in the first quarter of 2025 were $167 million, an 11% increase compared to the same period last year, and the ending backlog was $526.8 million, a 47% increase since the first quarter of 2024. The global parts and services business posted the highest Q1 bookings revenue, gross profit, and EBITDA in the past decade.

• Did not touch on updating guidance on the call, keeping it as is but noting to keep an eye on tariff negotiations and their potential impact on the business in 2025. • Stated core business continues to perform ahead of expectations and expects to return to positive cash flows in 2025 excluding BrightLoop.

• Keeping a close eye on tariff negotiations and any potential impact on the business in 2025.

Q: Maybe first for me on guidance. Just wanted to make sure I might have missed it, but are you kind of reiterating guidance for the year? And I know you had some kind of caution on just project timing and tariffs and things like that, but with the strong start to the year. Just wanted to get a little bit more color there, and maybe an update on the coal to gas conversion project and kind of thoughts for contribution this year versus the next couple of years?

A: We haven't touched on guidance on the call. Kept it where it is and keeping an eye on tariffs and their potential impact on projects. The natural gas project in Indiana is proceeding on schedule. The bulk of inbound technology shipment will happen later this year/early next year. On the BrightLoop project, the Massillon plant needs around $40 - $50 million additional financing, aiming to get construction teams on site in fall of this year and produce hydrogen by mid-2026. Also in discussions with DOE and others on Capitol Hill for other projects.

Q: Good afternoon. You had a pretty strong demand environment going on, what are some of the drivers that are kind of driving that at this point?

A: On the demand side, baseload generation worldwide has increased. Parts and services business seeing need for baseload generation increase. Q1 is typically light for parts and services, but demand came in strong globally. Some plants shifted outage work last year, leading to more parts wear and tear needing maintenance, and plants placing orders to anticipate future needs.