Shimmick Corporation (SHIM) Q4 2024 Earnings Call March 14, 2025 01:36 AM ET Company Participants Anthony Rasmus - Investor RelationsUral Yal - CEO & DirectorAmanda Mobley - Executive VP, Director of Accounting & Interim CFO Conference Call Participants Gerard Sweeney - Managing Director & Senior Research AnalystAaron Spychalla - Research Analyst Operator Good afternoon, and welcome to Chemek Corporation's Fourth Quarter and Full Year twenty twenty four Earnings Conference Call. At this time, all participan ...

Core Viewpoint - Shimmick Corporation reported a significant quarterly loss of $0.91 per share, which was worse than the Zacks Consensus Estimate of a loss of $0.29, indicating a substantial earnings surprise of -213.79% [1] Financial Performance - The company posted revenues of $103.55 million for the quarter ended December 2024, missing the Zacks Consensus Estimate by 13.71% and down from $138.06 million in the same quarter last year [2] - Over the last four quarters, Shimmick Corporation has surpassed consensus EPS estimates only once [2] Stock Performance - Shimmick Corporation shares have declined approximately 34.4% since the beginning of the year, compared to a decline of 4.8% for the S&P 500 [3] Future Outlook - The company's earnings outlook will be crucial for investors, particularly in light of management's commentary during the earnings call [4] - Current consensus EPS estimate for the upcoming quarter is -$0.32 on revenues of $112.8 million, and for the current fiscal year, it is -$0.43 on revenues of $491.7 million [7] Industry Context - The Waste Removal Services industry, to which Shimmick Corporation belongs, is currently ranked in the bottom 48% of over 250 Zacks industries, suggesting potential challenges ahead [8]

Financial Performance - Reported revenue of $104 million for Q4 2024, down from $138 million in Q4 2023, and total revenue of $480 million for FY2024, compared to $633 million in FY2023[5] - Net loss increased to $38 million for Q4 2024, compared to a net loss of $17 million in Q4 2023, with adjusted net loss of $31 million for Q4 2024 versus $14 million in Q4 2023[21][22] - Adjusted EBITDA for Q4 2024 was $(27) million, compared to $(9) million in Q4 2023[23] - Revenue for the three months ended January 3, 2025, was $103,552,000, a decrease of 25.1% compared to $138,062,000 for the same period in 2023[37] - Net loss attributable to Shimmick Corporation for the fiscal year ended January 3, 2025, was $124,748,000, compared to a net loss of $2,286,000 for the previous year[37] - Adjusted net loss for the three months ended January 3, 2025, was $(30,899) thousand, compared to $(13,954) thousand for the same period in 2023, reflecting a significant increase in losses[45] - For the fiscal year ended January 3, 2025, the net loss attributable to Shimmick Corporation was $(124,748) thousand, compared to $(2,546) thousand in 2023, indicating a substantial decline in performance[45] - Adjusted EBITDA for the three months ended January 3, 2025, was $(27,320) thousand, compared to $(8,755) thousand for the same period in 2023, highlighting worsening operational performance[53] Revenue Breakdown - Shimmick Projects revenue was $80 million for Q4 2024, a decrease of $5 million from $85 million in Q4 2023, primarily due to lower activity on existing jobs[8] - Legacy Projects revenue declined to $18 million for Q4 2024, down from $46 million in Q4 2023, driven by ongoing project wind-downs[10] - For FY2025, Shimmick expects Shimmick Projects revenue to increase by 10% to 15%, with overall gross margin between 9% and 12%[26] - Legacy Projects and Foundations Projects revenue is projected to be between $50 million and $60 million, with gross margin between (5)% and (15)%[26] Assets and Liabilities - Total current assets decreased to $141,000,000 as of January 3, 2025, from $257,458,000 as of December 29, 2023, representing a decline of 45.3%[35] - Total liabilities increased to $268,538,000 as of January 3, 2025, compared to $356,162,000 as of December 29, 2023[35] - Cash and cash equivalents decreased to $33,730,000 as of January 3, 2025, from $62,939,000 as of December 29, 2023[35] - The company experienced a significant increase in contract liabilities, with current contract liabilities at $102,524,000 as of January 3, 2025, compared to $115,785,000 as of December 29, 2023[35] Costs and Expenses - The company incurred $15,708,000 in ERP pre-implementation asset impairment and associated costs during the fiscal year ended January 3, 2025[37] - Stock-based compensation for the fiscal year ended January 3, 2025, amounted to $6,130 thousand, up from $2,062 thousand in 2023, indicating increased compensation expenses[45] - Legal fees and other costs for Legacy Projects totaled $14,030 thousand for the fiscal year ended January 3, 2025, compared to $8,740 thousand in 2023, reflecting ongoing legal challenges[45] - The company reported an interest expense of $5,426 thousand for the fiscal year ended January 3, 2025, compared to $2,284 thousand in 2023, indicating rising borrowing costs[53] Strategic Outlook - Recognized liquidity of $100 million as of January 3, 2025, reflecting the positive outcomes of the Transformation Plan implemented in 2024[5] - The company anticipates ongoing challenges related to market competition and operational costs, which may impact future financial performance[28] - The company aims to transform its strategy to meet the growing need for water and critical infrastructure, which is a key focus for future growth[48] - The company incurred transformation costs of $2,535 thousand in the three months ended January 3, 2025, as part of its strategy to address critical infrastructure needs[45] - Adjusted EBITDA and adjusted net loss figures were not provided in the forward-looking guidance due to the inability to predict certain items without unreasonable efforts[32] Backlog and Future Projections - Backlog exceeded $822 million as of January 3, 2025, with over 87% attributed to Shimmick Projects[5] - The company plans to enhance its current ERP system, resulting in a charge of approximately $16 million in the third quarter of fiscal 2024[46]

Core Viewpoint - Shimmick Corporation will announce its fourth quarter and full year 2024 results on March 13, 2025, followed by a conference call [1] Company Information - Shimmick Corporation is a leading infrastructure solutions provider specializing in complex projects related to water, climate resilience, energy transition, and sustainable transportation [1][4] - The company integrates technical excellence with collaborative project delivery methods to provide innovative, technology-driven infrastructure solutions [4] - Shimmick has a history spanning over a century and is headquartered in California, focusing on tackling complex infrastructure challenges [4] Conference Call Details - The conference call will take place at 5:00 p.m. (Eastern Time) on March 13, 2025, and can be accessed via phone or webcast [1][2][3] - A telephonic replay will be available approximately three hours after the call, with access until April 3, 2025 [2] - Interested parties can listen to the call through the Investor Relations section of the company's website [3]

IRVINE, Calif., Dec. 05, 2024 (GLOBE NEWSWIRE) -- Shimmick Construction Company, Inc. (“Shimmick”), a leader in critical infrastructure, water, and transit solutions, announced today that it has been awarded a key role in the North Hollywood to Pasadena Bus Rapid Transit (BRT) Project by Los Angeles Metropolitan Transportation Authority (LA Metro). Shimmick, with our partner Myers and Sons, as part of the Myers-Shimmick Joint Venture (MSJV), will serve as the Construction Manager/General Contractor (CM/GC) ...

IRVINE, Calif., Dec. 02, 2024 (GLOBE NEWSWIRE) -- Shimmick Construction Company, Inc. (“Shimmick”) (Nasdaq:SHIM), a leading water and critical infrastructure builder, today announce that it has been awarded a $45.4 million contract to complete extensive seismic retrofitting and improvements to the Murray Street Bridge at the Santa Cruz Small Craft Harbor. The project will improve the bridge's seismic resilience while enhancing accessibility for cyclists and pedestrians. "This project exemplifies Shimmick's ...

Shimmick Corporation (SHIM) came out with quarterly earnings of $0.72 per share, beating the Zacks Consensus Estimate of a loss of $0.38 per share. This compares to earnings of $1.67 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 289.47%. A quarter ago, it was expected that this company would post a loss of $0.30 per share when it actually produced a loss of $1.60, delivering a surprise of -433.33%.Over the last four quarters ...

Financial Performance - Revenue for the three months ended September 27, 2024, was $166 million, a decrease of $9 million (5%) compared to $175 million for the same period in 2023[116]. - Gross margin for the same period was $12 million, down $4.8 million (28%) from $17 million in the prior year[116]. - Shimmick Projects generated revenue of $101 million, a decrease of $8.4 million (8%) from $110 million in the previous year[119]. - Foundations Projects revenue was $11 million, down from $12 million, reflecting the winding down of jobs[120]. - Legacy Projects revenue remained flat at $54 million, with a $31 million adjustment due to the GGB Project settlement included in this figure[122]. - Net loss for the three months ended September 27, 2024, was $2 million, a decrease of $36 million compared to a net income of $34 million in the prior year[129]. - Revenue for the nine months ended September 27, 2024, was $376.7 million, a decrease of $118.1 million or 24% compared to $494.7 million for the same period in 2023[130]. - Gross margin for the nine months ended September 27, 2024, was $(34.8) million, a decline of $57.6 million or 253% compared to $22.8 million for the same period in 2023[130]. - Net loss for the nine months ended September 27, 2024, was $86.3 million, an increase of $101.5 million or 668% compared to a net income of $15.2 million in the prior year[143]. - Adjusted EBITDA for the three months ended September 27, 2024, was $29,679,000, down from $41,712,000 in the same period of 2023, reflecting a decrease of approximately 29%[152]. Project Backlog and Contracts - As of September 27, 2024, the company had a project backlog of $834 million, with over 50% attributed to water projects[89]. - The backlog as of September 27, 2024, was composed of 70% from state and local agencies, 13% from federal agencies, and 17% from private owners[174]. - The estimated backlog recognized within 0 to 24 months is 81% of the total backlog as of September 27, 2024[176]. Settlements and Legal Matters - A settlement agreement for the Golden Gate Bridge Project will yield total proceeds of $97 million, with $25 million due within 14 business days and the remaining $72 million by December 17, 2024[91]. - The company recognized a gross margin increase of $11 million from the Golden Gate Bridge Project settlement during the three months ended September 27, 2024[93]. - The company received $33 million in cash from a settlement with the United States Army Corps of Engineers, impacting revenue for the six months ended June 28, 2024[94]. - The company expects to receive approximately $97 million in the 2024 fiscal year from the settlement of a claim on the GGB Project[153]. Capital and Financing Activities - The company completed a sale-leaseback of its equipment yard for $20.5 million, resulting in net proceeds of $17 million used to repay borrowings[95]. - The company’s initial public offering in November 2023 raised approximately $19 million in net proceeds from the sale of 3,575,000 shares at $7.00 per share[99]. - The company reported a net cash provided by investing activities for the nine months ended September 27, 2024, of $18 million, primarily from asset sales of $32 million[165]. - For the same period, net cash provided by financing activities was $10 million, mainly from net borrowings of $12 million[167]. - The company incurred $2 million in debt issuance costs related to the Credit Facility agreement during the nine months ended September 27, 2024[167]. - As of September 27, 2024, total debt outstanding under the Credit Facility was $42 million, with no borrowings under the Revolving Credit Facility[161]. - The Revolving Credit Facility has a total commitment of $15 million and matures on December 31, 2024, with no instances of noncompliance reported as of September 27, 2024[160]. Operational Challenges - The company anticipates that adverse weather conditions and natural disasters could negatively impact financial results due to project delays and increased liabilities[101]. - Interest expense rose by $2 million, attributed to charges on a new Credit Facility established in May 2024[128]. - Interest expense increased by $3.4 million, primarily due to interest charges on the Credit Facility and Revolving Credit Facility[141]. Strategic Decisions and Changes - A strategic decision to enhance the current ERP system led to a one-time charge of $16 million recorded in the three months ended September 27, 2024[96]. - ERP pre-implementation asset impairment and associated costs increased by $16 million due to a strategic decision to enhance the current ERP system[127]. - The company focuses on self-performing complex projects to reduce risks of cost and schedule overruns, differentiating itself from competitors[89]. - The company is classified as an "emerging growth company" and a "smaller reporting company," allowing it to take advantage of scaled disclosure obligations[180][183]. Cash Flow and Liquidity - Unrestricted cash and cash equivalents as of September 27, 2024, totaled $26 million, with total liquidity amounting to $59 million including available credit facilities[153]. - Net cash used in operating activities for the nine months ended September 27, 2024, was $(66,183,000), compared to $(64,776,000) for the same period in 2023[163]. - The company experienced a net increase in contract capital of $2 million during the nine months ended September 27, 2024, due to decreases in accounts payable and contract liabilities[164]. Asset Management - Gain on sale of assets decreased by $13 million, primarily due to a prior year gain of $30 million that did not recur[126]. - Gain on sale of assets decreased by $11.2 million, primarily due to the absence of a prior year gain from the sale of non-core business contracts[140]. - Capital expenditures for the nine months ended September 27, 2024, were approximately $10 million, an increase from $6 million in the same period of 2023[153].

Exhibit 99.1 Shimmick Corporation Announces Third Quarter 2024 Results Irvine, CA, November 12, 2024 – Shimmick Corp. (NASDAQ: SHIM), a leading water infrastructure company, today announced financial results for the third quarter ended September 27, 2024. Third Quarter 2024 and Recent Highlights Golden Gate Bridge Project Settlement: | --- | --- | |-------|--------------------------------------------------------------------------------------------------------------------------------------------------------- ...

IRVINE, Calif., Nov. 12, 2024 (GLOBE NEWSWIRE) -- Shimmick Corp. (NASDAQ: SHIM), a leading water infrastructure company, today announced financial results for the third quarter ended September 27, 2024. Third Quarter 2024 and Recent Highlights Settlement in the Company’s Golden Gate Bridge ("GGB") Project which will result in $97 million of cash collected before the end of 2024 and is the last major outstanding legal claim related to its Legacy Projects.Announced the hiring of Ural Yal as Chief Executive Of ...