Orion Group Holdings, Inc. Q1 FY2026 earnings call

• Travis mentioned 2026 started solid with $24 billion pipeline of opportunities, marine segment benefited from mission-critical maritime infrastructure demand, especially defense and port modernization projects; president's 2027 budget proposal prioritizes investment in defense-related hard assets. - Concrete team had fantastic quarter with strong revenue and adjusted EBITDA expansion, data centers accounted for ~40% of concrete revenues, and other sectors like advanced manufacturing, transportation, etc. also had growing opportunities. Recent expansion into site civil, earthwork, and underground utilities increased size and scale of concrete pursuits. - End of quarter backlog stood at $668 million with $220 million in new awards and change orders booked, and continued bookings momentum into April with over $200 million in new work awarded.

Marine segment: Reported revenue of $110 million and adjusted EBITDA of $12 million, representing an 11% margin. Compared to first quarter of 2025, revenue was $127 million and adjusted EBITDA was $17 million. Decreases were primarily due to ramp down of several large projects and early starts on new projects. Concrete business: Reported revenue of $106 million and adjusted EBITDA of $8.6 million, representing an 8% margin. Compared to prior year quarter, revenue was $61.5 million and adjusted EBITDA was $2.8 million. Results are high watermark for revenue and adjusted EBITDA due to outstanding productivity, execution, and momentum. Data centers accounted for around 40% of concrete revenues in the quarter.

• Reaffirmed four-year 2026 guidance. First quarter revenue was $216 million, net income $4.7 million, adjusted EBITDA $8.7 million, adjusted EPS 5 cents per share. Represents 15% growth in revenue and 7% growth in adjusted EBITDA compared to first quarter 2025. - Held current guidance as of now, with confidence in pipeline and backlog as things progress over the year.

• Jones Act temporary pause related to Strait of Hormuz disruption has little to no impact on business but strongly opposed to any Jones Act modifications. - Fuel price increase could have minor impacts if long-term, with contingency built in bids. - Tariff developments like Section 232 expansions monitored, but generally in good shape with contingencies or locked-in prices in bids.

Q: Given the solid start of first quarter and positive project updates in April, no upward revision to whole year guidance. Is this due to conservative assumptions or lag in marine segment despite strong concrete?

A: Just initiated guidance last month, had good view, and with bookings post end of quarter, feeling more confident but taking conservative approach.

Q: Adjusted EBITDA margins contracted year over year in first quarter. Elaborate on concrete plans for margin recovery after second quarter?

A: Margin impacts in marine due to phasing of projects, concrete margins product of strong execution, momentum, uninterrupted momentum.

Q: Order activity continuing to pick up into April, acceleration for early work on energy and petrochem side. Talk about timeline and size/content?

A: Seeing fair amount of activity, increased urgency, some projects may move quickly depending on permitting, have good number of clients and programs with momentum.

Q: Given level of backlog, is revenue and margins sustainable in intermediate term?

A: Between backlog and activity, don't see cliff or slowdown, confident in pipeline and backlog to build year and deliver in latter half.

Q: Operating cash flow strong in slower quarter, any priority to de-levering?

A: Balance sheet in good shape at 1.5 times net leverage, priority in capital deployment is organic growth, M&A considered disciplined if makes sense.