GLDD President and CEO Lasse Petterson: “The port deepening and widening projects that were delayed in 2022 are starting to enter the market.”
America’s largest supplier of dredging companies Great Lakes Dredge & Dock Corporation (Nasdaq: GLDD) reported first quarter 2023 outcomes that included a complete working lack of $0.9 million, a web lack of $3.2 million and adjusted EBITDA of $10.2 million. Revenue was $158 million. Despite the pink ink, all this was an enchancment on what had gone earlier than.
“We reported improved results in the first quarter of 2023, showing improvements in gross profit margins and adjusted EBITDA from the prior three quarters,” mentioned GLDD president and CEO Lasse Petterson. “Despite going through continued challenges associated to climate delays within the Northeast and a lower-than-normal quantity of capital work, we ended the quarter with revenues of $158.0 million and adjusted EBITDA of $10.2 million. The firm’s improved first quarter efficiency is primarily because of extra challenge work for our vessels and changes we have now made to the enterprise and operations to enhance profitability.
“We have taken swift and proactive action on cost reductions and fleet adjustments. Last year we retired the 42-year-old hopper dredge, the Terrapin Island, and we currently have cold stacked two major dredges and support equipment as we continue to watch the bid market. Correspondingly, we are adjusting our general and administrative, overhead cost structures and dredging fleet to reflect the changed market conditions, which have already led to substantially reduced costs in 2023.”
“In the primary quarter of 2023, Great Lakes’ whole bid market reached over $300 million, which is roughly $125 million better than the primary quarter of 2022. The port deepening and widening initiatives that have been delayed in 2022 are beginning to enter the market. The first quarter noticed one capital challenge bid, and April 2023 included another capital challenge.
“Great Lakes ended the quarter with $327.1 million of dredging backlog, which doesn’t embody roughly $50.0 million {dollars} of efficiency obligations associated to offshore wind contracts. In addition, we ended the quarter with $516.9 million in low bids and choices pending award. The firm’s awarded work in the course of the quarter represents 31.7% of the primary quarter bid market. Not included within the first quarter backlog is the Freeport Capital Port Deepening challenge, on which Great Lakes was low bidder in April for about $160 million, which is the third largest home capital challenge Great Lakes has received in its historical past. We are additionally optimistic that one or two liquified pure fuel initiatives on which we’re low bidder might obtain remaining funding resolution in 2023 with dredging to probably begin within the second half of the yr and persevering with into 2024. We anticipate that the improved market circumstances, mixed with the fleet adjustment and price discount initiatives we have now in place, will present improved leads to 2023 and past.
“Although we have now seen general enchancment in leads to the primary quarter, and bidding has picked up, second quarter utilization is predicted to be decrease than the primary quarter. Our fleet renewal program stays on price range with our mid-size hopper dredge, the Galveston Island, anticipated to be operational mid-year 2023 and her sistership, the Amelia Island, is predicted to be delivered in 2025.
“We are executing on our strategy to enter the fast-growing U.S. offshore wind market. Construction of our U.S. flagged Jones Act-compliant inclined fallpipe vessel for subsea rock installation, which will be named the Acadia, is on budget and expected to be delivered and operational in the first half of 2025. In 2022, Great Lakes was awarded rock installation contracts for the Empire Wind I and II projects by Equinor and BP, with installation windows in 2025 and 2026. We are currently bidding several other offshore wind farm projects with rock installations planned for 2025 and beyond.”
