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Mar 31, 2024
Matrix Service Q3 2024 Earnings Report
Matrix Service Company reported Q3 2024 results with a significant backlog increase but a revenue decline.
Key Takeaways
Matrix Service Company reported a 11% decrease in revenue to $166.0 million for the third quarter of fiscal year 2024, while backlog increased by 74% year-over-year to $1.45 billion. The company experienced a net loss per share of ($0.53) and an adjusted EBITDA of ($9.8) million. Despite the revenue decline, project performance remained strong, and the company is positioned for improved profitability in fiscal 2025.
Total backlog increased by 74% year-over-year to $1.45 billion, the highest in company history.
Total project awards reached $186.8 million, resulting in a book-to-bill ratio of 1.1x.
Revenue declined by 11% year-over-year to $166.0 million.
Cash flow from operations was $25 million, a 25% increase year-over-year.
Matrix Service
Matrix Service
Matrix Service Revenue by Segment
Revenue by Segment
Storage and Terminal Solutions Revenue
CapyFin.comUtility and Power Infrastructure Revenue
CapyFin.comProcess and Industrial Facilities Revenue
CapyFin.com Forward Guidance
The company expects revenue to increase in the fourth quarter as backlog converts to revenue. Revenue volumes are expected to increase in the Storage and Terminal Solutions and Utility and Power Infrastructure segments, while the Process and Industrial Facilities segment is expected to see a decrease.
Positive Outlook
- Overall backlog quality remains strong.
- Revenue is expected to increase in the fourth quarter.
- Storage and Terminal Solutions segment expects increased revenue volumes due to specialty vessel projects.
- Utility and Power Infrastructure segment expects increased revenue volumes due to LNG peak shaving projects.
- Company expects improvement in project activity versus third quarter results, positioning the company to realize improved fixed cost absorption into fiscal year-end
Challenges Ahead
- Process and Industrial Facilities segment expects revenue to decrease as existing projects near completion.
- Gross margins were negatively impacted by the under-recovery of construction overhead costs due to low revenue.
- Gross margin was impacted by reduced labor demand for turnaround and maintenance services in the final year of a three-year refinery maintenance contract.
- SG&A expenses increased primarily due to an increase in expense associated with the variable accounting for cash-settled stock compensation, and increased project pursuit costs.
- The Company's effective tax rate for the third quarter of fiscal 2024 was zero, impacted by the valuation allowance placed on all our deferred tax assets due to the existence of a cumulative loss over a three-year period.
Revenue & Expenses
Visualization of income flow from segment revenue to net income