What changed in this filing

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Item 1. Financial Statements

2025-11-06 compared with 2025-05-08 · 108 added, 142 removed, 288 unchanged (46% of the section changed)

3 unchanged sentences

(In thousands, except per share data)

Three Months Ended Nine Months Ended

March 31, 2025 March 31, 2024 March 31, 2025 March 31, 2024

Three Months Ended

September 30, 2025 September 30, 2024

Revenue $ 211,884 $ 165,579

7 unchanged sentences

Interest income 1,802 1,572

Other (Note 3) 182 ( 235 ) ( 313 ) 4,481

Loss before income tax expense ( 3,594 ) ( 9,223 )

Provision (benefit) for federal, state and foreign income taxes — ( 2 ) 16 4

Provision for federal, state and foreign income taxes 69 —

Net loss $ ( 3,663 ) $ ( 9,223 )

8 unchanged sentences

(In thousands)

Three Months Ended Nine Months Ended

2025 March 31,

2024 March 31,

2025 March 31,

Three Months Ended

September 30,

2025 September 30,

Net loss $ ( 3,663 ) $ ( 9,223 )

Other comprehensive income (loss), net of tax:

Foreign currency translation loss ( 23 ) ( 548 ) ( 950 ) ( 524 )

Foreign currency translation gain (loss) ( 528 ) 436

Comprehensive loss $ ( 4,191 ) $ ( 8,787 )

3 unchanged sentences

(In thousands)

September 30,

2025 June 30,

18 unchanged sentences

(In thousands, except share data)

September 30,

2025 June 30,

16 unchanged sentences

60,000,000 shares authorized;

27,888,217 shares issued at March 31, 2025 and June 30, 2024, respectively;

27,606,852 and 27,308,795 shares outstanding as of March 31, 2025 and June 30, 2024, respectively;

28,070,427 shares issued and outstanding at September 30, 2025;

27,888,217 shares issued at June 30, 2025 and 27,610,486 shares outstanding as of June 30, 2025;

Additional paid-in capital 145,100 149,969

1 unchanged sentence

Accumulated other comprehensive loss ( 9,931 ) ( 9,403 )

Treasury stock, at cost — 281,365 and 579,422 shares as of March 31, 2025 and June 30, 2024, respectively;

( 2,640 ) ( 6,083 )

Treasury stock, at cost — 0 shares as of September 30, 2025 and 277,731 shares as of June 30, 2025;

Total stockholders' equity 136,266 142,716

4 unchanged sentences

(In thousands)

Nine Months Ended

2025 March 31,

Three Months Ended

September 30,

2025 September 30,

Operating activities:

Net loss $ ( 3,663 ) $ ( 9,223 )

Adjustments to reconcile net loss to net cash provided by (used in) operating activities:

Adjustments to reconcile net loss to net cash provided (used) by operating activities:

Depreciation and amortization 2,461 2,515

Stock-based compensation expense 1,921 2,311

Gain on disposal of property, plant and equipment (Note 3) ( 122 ) ( 4,530 )

Other 108 202

Operating lease impairment due to restructuring 1,529 —

Loss (gain) on disposal of property, plant and equipment ( 217 ) 68

Changes in operating assets and liabilities increasing (decreasing) cash:

6 unchanged sentences

Accrued expenses ( 6,261 ) ( 2,908 )

Net cash provided by operating activities 76,763 25,567

Net cash provided (used) by operating activities ( 25,899 ) 11,918

Investing activities:

Capital expenditures ( 2,011 ) ( 1,944 )

Proceeds from sale of property, plant and equipment (Note 3)

Proceeds from sale of property, plant and equipment 222 —

Net cash used by investing activities ( 1,789 ) ( 1,944 )

Financing activities:

Advances under asset-backed credit facility — 10,000

Repayments of advances under asset-backed credit facility — ( 20,000 )

Payment of debt amendment fees ( 149 ) —

Proceeds from issuance of common stock under employee stock purchase plan 43 46

Repurchase of common stock for payment of statutory taxes due on equity-based compensation ( 1,235 ) ( 456 )

Payments related to tax withholding for stock-based compensation ( 4,223 ) ( 1,235 )

Net cash used by financing activities ( 4,329 ) ( 1,189 )

Effect of exchange rate changes on cash ( 317 ) 210

Net increase in cash and cash equivalents 69,926 14,846

Net increase (decrease) in cash and cash equivalents ( 32,334 ) 8,995

Cash, cash equivalents and restricted cash, beginning of period 249,641 140,615

1 unchanged sentence

Supplemental disclosure of cash flow information:

Cash paid (received) during the period for:

Cash paid during the period for:

Income taxes $ 34 $ —

12 unchanged sentences

Shares Amount Shares Amount Total

December 31, 2024 27,888,217 $ 279 $ 145,608 $ 19,185 $ ( 10,462 ) 285,392 $ ( 2,676 ) $ 151,934

Net loss — — — ( 3,434 ) — — — ( 3,434 )

Other comprehensive loss — — — — ( 23 ) — — ( 23 )

Treasury shares sold to Employee Stock Purchase Plan — — 12 — — ( 4,027 ) 36 48

Stock-based compensation expense — — 2,185 — — — — 2,185

March 31, 2025 27,888,217 $ 279 $ 147,805 $ 15,751 $ ( 10,485 ) 281,365 $ ( 2,640 ) $ 150,710

December 31, 2023 27,888,217 $ 279 $ 140,668 $ 52,899 $ ( 8,745 ) 587,732 $ ( 6,191 ) $ 178,910

Net loss — — — ( 14,581 ) — — — ( 14,581 )

Other comprehensive loss — — — — ( 548 ) — — ( 548 )

Treasury shares sold to Employee Stock Purchase Plan — — ( 14 ) — — ( 4,249 ) 55 41

Stock-based compensation expense — — 1,980 — — — — 1,980

March 31, 2024 27,888,217 $ 279 $ 142,634 $ 38,318 $ ( 9,293 ) 583,483 $ ( 6,136 ) $ 165,802

Common Stock Additional

Capital Retained

Earnings Accumulated

Comprehensive

Loss Treasury Stock

Shares Amount Shares Amount Total

June 30, 2025 27,888,217 $ 279 $ 149,969 $ 4,479 $ ( 9,403 ) 277,731 $ ( 2,608 ) $ 142,716

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Treasury shares sold to Employee Stock Purchase Plan — — 15 — — ( 3,153 ) 28 43

Treasury shares purchased to satisfy tax withholding obligations — — — — — 123,850 ( 1,234 ) ( 1,234 )

Stock-based compensation expense — — 1,921 — — — — 1,921

March 31, 2025 27,888,217 $ 279 $ 147,805 $ 15,751 $ ( 10,485 ) 281,365 $ ( 2,640 ) $ 150,710

September 30, 2025 28,070,427 $ 281 $ 145,100 $ 816 $ ( 9,931 ) — $ — $ 136,266

June 30, 2024 27,888,217 $ 279 $ 145,580 $ 33,941 $ ( 9,535 ) 579,422 $ ( 6,083 ) $ 164,182

Net loss — — — ( 9,223 ) — — — ( 9,223 )

Other comprehensive loss — — — — ( 524 ) — — ( 524 )

Other comprehensive income — — — — 436 — — 436

Issuance of restricted stock — — ( 4,109 ) — — ( 360,460 ) 4,109 —

2 unchanged sentences

Stock-based compensation expense — — 2,311 — — — — 2,311

March 31, 2024 27,888,217 $ 279 $ 142,634 $ 38,318 $ ( 9,293 ) 583,483 $ ( 6,136 ) $ 165,802

September 30, 2024 27,888,217 $ 279 $ 143,765 $ 24,718 $ ( 9,099 ) 338,015 $ ( 3,146 ) $ 156,517

Matrix Service Company

8 unchanged sentences

The accompanying condensed consolidated financial statements should be read in conjunction with the audited financial statements for the year ended June 30, 2025, included in our Annual Report on Form 10-K.

The results of operations for the three and nine month periods ended March 31, 2025 may not necessarily be indicative of the results of operations for the full year ending June 30, 2025.

The results of operations for the three month period ended September 30, 2025 may not necessarily be indicative of the results of operations for the full year ending June 30, 2026.

Significant Accounting Policies

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Accounting Standards Not Yet Adopted

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures, which expands disclosures about a public entity’s reportable segments and requires enhanced information about a reportable segment’s expenses, interim segment profit or loss, and how a public entity’s chief operating decision maker uses reported segment profit or loss information in assessing segment performance and allocating resources.

The update will be effective for annual periods beginning after December 15, 2023 (fiscal 2025).

Adoption of this ASU will result in additional disclosure, but will not impact the Company's consolidated financial position, results of operations or cash flows.

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740):

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Adoption of this ASU will result in additional disclosure, but will not impact the Company's consolidated financial position, results of operations or cash flows.

Other accounting pronouncements issued but not effective until after March 31, 2025 are not expected to have a material impact on the Company's consolidated financial position, results of operations, or cash flows.

Other accounting pronouncements issued but not effective until after September 30, 2025 are not expected to have a material impact on the Company's consolidated financial position, results of operations, or cash flows.

Note 2 – Revenue

Remaining Performance Obligations

We had $ 1.1 billion of remaining performance obligations yet to be satisfied as of March 31, 2025.

We had $ 958.3 million of remaining performance obligations yet to be satisfied as of September 30, 2025.

We expect to recognize $ 621.3 million of our remaining performance obligations as revenue within the next twelve months.

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The following table provides information about CIE and BIE:

September 30,

2025 June 30,

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Net contract liabilities $ ( 279,644 ) $ ( 293,829 ) $ 14,185

The difference between the beginning and ending balances of our CIE and BIE primarily results from the timing of revenue recognized relative to the billings on the associated contracts.

The amount of revenue recognized during the nine months ended March 31, 2025 that was included in the June 30, 2024 BIE balance was $ 162.5 million.

Progress billings in accounts receivable at March 31, 2025 and June 30, 2024 included retentions to be collected within one year of $ 30.2 million and $ 11.6 million, respectively.

Contract retentions collectible beyond one year are included in Other assets, non-current in the Condensed Consolidated Balance Sheets and totaled $ 51.3 million as of March 31, 2025 and $ 28.6 million as of June 30, 2024, respectively.

The difference between the beginning and ending balances of our CIE and BIE primarily results from the timing of revenue recognized relative to our billings.

The amount of revenue recognized during the three months ended September 30, 2025 that was included in the June 30, 2025 BIE balance was $ 126.6 million.

Progress billings in accounts receivable at September 30, 2025 and June 30, 2025 included retentions to be collected within one year of $ 29.4 million and $ 29.0 million, respectively.

Contract retentions collectible beyond one year are included in Other assets, non-current in the Condensed Consolidated Balance Sheets and totaled $ 71.3 million as of September 30, 2025 and $ 61.5 million as of June 30, 2025, respectively.

Unpriced Change Orders and Claims

Net contract liabilities included revenues for unpriced change orders and claims of $ 11.8 million at March 31, 2025 and $ 9.9 million at June 30, 2024.

Costs and estimated earnings in excess of billings on uncompleted contracts included revenues for unpriced change orders and claims of $ 12.9 million at September 30, 2025 and $ 11.4 million at June 30, 2025.

The amounts ultimately realized may be different than the recorded amounts resulting in adjustments to future earnings.

Generally, we expect collection of amounts related to unpriced change orders and claims within twelve months.

However, customers may not pay these amounts until final resolution of related claims, and therefore collection of these amounts may extend beyond one year.

However, customers may not pay these amounts until final resolution of related claims, which may extend beyond one year.

Disaggregated Revenue

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Geographic Disaggregation:

Three Months Ended Nine Months Ended

2025 March 31,

2024 March 31,

2025 March 31,

Three Months Ended

September 30,

2025 September 30,

(In thousands)

4 unchanged sentences

Contract Type Disaggregation:

Three Months Ended Nine Months Ended

2025 March 31,

2024 March 31,

2025 March 31,

Three Months Ended

September 30,

2025 September 30,

(In thousands)

2 unchanged sentences

Total Revenue $ 211,884 $ 165,579

Note 3 – Property, Plant and Equipment

During the first quarter of fiscal 2024, we sold a previously utilized facility in Burlington, Ontario for $ 2.7 million in net proceeds, which resulted in a gain of $ 2.5 million.

The gain was included in Other income in the Condensed Consolidated Statements of Income.

We closed this previously utilized facility during the second quarter of fiscal 2023 because it was no longer strategic to the future of the business.

During the second quarter of fiscal 2024, we sold a facility in Catoosa, Oklahoma for $ 2.7 million in net proceeds, which resulted in a gain of $ 2.0 million.

Proceeds were received in January 2024.

The gain was included in Other income in the Condensed Consolidated Statements of Income.

The facility was previously utilized for our industrial cleaning business, which was sold during the fourth quarter of fiscal 2023.

The Catoosa, Oklahoma facility was closed as it was no longer strategic to the future of the business.

During the third quarter of fiscal 2024, we purchased a fabrication facility in Bakersfield, California for $ 4.1 million to replace a facility being leased by the Company.

There were no individually significant purchases or sales of property, plant and equipment in the nine months ended March 31, 2025.

Note 3 – Debt

On September 9, 2021 , the Company and our primary U.S.

and Canada operating subsidiaries entered into an asset-based credit agreement, which was most recently amended on May 3, 2024 (as amended, the "ABL Facility"), with Bank of Montreal, as Administrative Agent, Swing Line Lender and a Letter of Credit Issuer.

and Canada operating subsidiaries entered into an asset-based credit agreement, which was most recently amended on August 22, 2025 (as amended, the "ABL Facility"), with Bank of Montreal, as Administrative Agent, Swing Line Lender and a Letter of Credit Issuer.

The maximum amount of loans under the ABL Facility is limited to $ 90.0 million.

The ABL Facility's available borrowings may be increased by an amount not to exceed $15.0 million, subject to certain conditions, including obtaining additional commitments.

The ABL Facility is intended to be used for working capital, capital expenditures, issuances of letters of credit and other lawful purposes.

4 unchanged sentences

We are required to maintain a minimum of $ 25.0 million of restricted cash at all times, but such amounts are also included in the borrowing base.

The borrowing base is recalculated on a monthly basis and at March 31, 2025, our borrowing base was $ 66.3 million.

The Company had $ 4.8 million in letters of credit outstanding as of March 31, 2025, which resulted in availability of $ 61.5 million under the ABL Facility.

Borrowings under the ABL Facility bear interest through maturity at a variable rate based upon, at our option, an annual rate of either a base rate (“Base Rate”), an Adjusted Term Secured Overnight Financing Rate ("Adjusted Term SOFR"), or at the Canadian Prime Rate, plus an applicable margin.

The Adjusted Term SOFR is defined as (i) the SOFR plus (ii) 11.448 basis points for a one-month tenor and 26.161 basis points for a three-month tenor;

provided that the Adjusted Term SOFR cannot be below zero.

The borrowing base is recalculated on a monthly basis and at September 30, 2025, our borrowing base was $ 61.4 million.

The Company had $ 4.8 million in letters of credit outstanding as of September 30, 2025, which resulted in availability of $ 56.6 million under the ABL Facility.

Borrowings under the ABL Facility bear interest through maturity at a variable rate based upon, at our option, an annual rate of either a base rate (“Base Rate”), a Term Secured Overnight Financing Rate ("Term SOFR"), or at the Canadian Prime Rate, plus an applicable margin.

The Term SOFR rate, whether for one-month or three-month tenor, is provided by a third party defined in the ABL Facility ("Term SOFR Administrator").

The Term SOFR Administrator publishes a daily set of forward-looking interest rates for various tenors, provided that the Term SOFR cannot be below zero.

The Base Rate is defined as a fluctuating interest rate equal to the greater of:

2 unchanged sentences

federal funds rate plus 0.50 %;

(iii) Adjusted Term SOFR for one month period plus 1.00 %;

(iii) Term SOFR for one month period plus 1.00 %;

or (iv) 1.00 %.

Depending on the amount of average availability, the applicable margin is between 1.00 % to 1.50 % for Base Rate and Canadian Prime Rate borrowings, which includes either U.S.

or Canadian prime rate, and between 2.00 % and 2.50 % for Adjusted Term SOFR borrowings.

Interest is payable either (i) monthly for Base Rate or Canadian Prime Rate borrowings or (ii) the last day of the interest period for Adjusted Term SOFR borrowings, as set forth in the ABL Facility.

or Canadian prime rate, and between 2.00 % and 2.50 % for Term SOFR borrowings.

Interest is payable either (i) monthly for Base Rate or Canadian Prime Rate borrowings or (ii) the last day of the interest period for Term SOFR borrowings, as set forth in the ABL Facility.

The fee for undrawn amounts is 0.25 % per annum and is due quarterly.

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In the event that our availability is less than the greater of (i) $ 13.5 million and (ii) 15.00 % of the commitments under the ABL Facility then in effect, a consolidated Fixed Charge Coverage Ratio of at least 1.00 to 1.00 must be maintained.

We were in compliance with all covenants of the ABL Facility as of March 31, 2025.

We were in compliance with all covenants of the ABL Facility as of September 30, 2025.

Note 4 – Income Taxes

Effective Tax Rate

During the three and nine months ended March 31, 2025, our effective tax rates were zero and ( 0.1 )%, respectively.

During the three and nine months ended March 31, 2024 our effective tax rates were zero.

The effective tax rates during fiscal 2025 were impacted by valuation allowances of $ 1.2 million and $ 4.3 million, respectively, placed on deferred tax assets generated during the three and nine months ended March 31, 2025.

The effective tax rates during fiscal 2024 were impacted by valuation allowances of $ 4.4 million and $ 5.8 million, respectively, placed on deferred tax assets during the three and nine months ended March 31, 2024.

During the three months ended September 30, 2025 and 2024, our effective tax rates were ( 1.9 )% and zero .

The effective tax rates during both periods were impacted by valuation allowances of $ 1.4 million and $ 1.3 million, respectively, placed on deferred tax assets generated during the quarters.

Valuation Allowance

We placed a valuation allowance on our deferred tax assets in fiscal 2022 due to the existence of a cumulative loss over a three-year period.

Currently, we place valuation allowances on newly generated deferred tax assets.

We recorded a valuation allowance on our deferred tax assets due to the existence of a cumulative loss over a three-year period.

We will continue to place valuation allowances on newly generated deferred tax assets.

We will realize the benefit associated with the deferred tax assets for which the valuation allowance has been provided as we generate taxable income.

Note 5 – Commitments and Contingencies

We are party to various legal actions, claims and other contingencies that arise in the ordinary course of business.

These actions typically seek, among other things, compensation for alleged workers’ compensation claims, personal injury claims, and contract disputes, some of which may be subject to certain insurance coverage.

With respect to all such matters, we record a loss when it is probable that a liability has been incurred and the amount of loss can be reasonably estimated.

In addition, we disclose matters for which management believes a material loss is at least reasonably possible.

Insurance Reserves

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In response, on June 2, 2022, the customer filed counterclaims seeking $ 20.0 million , which included liquidated damages and damages with respect to miscellaneous warranty items.

On October 31, 2022, the customer amended its counterclaim claiming damages in a range of $ 18.8 million to $ 36.0 million, which included estimated amounts for “potential future costs.” In July 2024, the customer filed a second amended counterclaim which significantly increased the amount of alleged damages to a range of $ 69.6 million to $ 97.9 million, including a new claim for unspecified “other damages” of $ 46.9 million .

A portion of the total alleged damages, if we are held liable, may be subject to certain insurance coverages.

We are actively pursuing our claims and believe we have substantial legal and contractual defenses to the customer's counterclaims.

Our hearing for this matter is currently scheduled for August 2025.

As part of the arbitration process, our claim amount was specified at $ 24.5 million and Keyera's counterclaim was reduced to $ 72.9 million .

We believe we have substantial legal and contractual defenses to the claims presented, many of which are expressly disallowed per the contract.

Additionally, in the event we are found liable for a portion of the alleged damages, they may be subject to certain insurance coverages.

Arbitration proceedings were held in August 2025.

Following submission of post-hearing briefs, the arbitration hearing will be closed and awaiting a decision by the arbitrator, which is expected in fiscal 2026.

During fiscal 2023, we completed construction services on a time and materials basis at a mining and minerals facility.

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We denied all claims and filed a countersuit against the customer for failure to pay amounts due of $ 5.6 million.

Our trial for this matter is currently scheduled for February 2026.

We believe we have set appropriate reserves based on our evaluation of the possible outcomes for the matters described above.

Based on the current trial schedule, we anticipate this matter will be resolved in calendar year 2026.

We believe we have set appropriate accruals based on our evaluation of the possible outcomes for the matters described above.

However, the results of litigation are inherently unpredictable, and the possibility exists that the ultimate resolution of one or more of these matters could result in a material effect on our financial position, results of operations or liquidity.

We and our subsidiaries are participants in various other legal actions;

however, assessing the eventual outcome of litigation involves forward-looking speculation as to judgement being made by arbitrators, judges, juries and appellate courts in the future.

upon information presently available, and in light of legal and other factual defenses available to the Company, management does not believe that such other known legal actions will have a material adverse effect on our financial position, results of operations or liquidity.

however, assessing the eventual outcome of litigation involves forward-looking speculation as to judgment being made by arbitrators, judges, juries and appellate courts in the future.

Based upon information presently available, and in light of legal and other factual defenses available to the Company, management does not believe that such other known legal actions will have a material adverse effect on our financial position, results of operations or liquidity.

Note 6 – Earnings per Common Share

4 unchanged sentences

The computation of basic and diluted earnings per share is as follows:

Three Months Ended Nine Months Ended

2025 March 31,

2024 March 31,

2025 March 31,

Three Months Ended

September 30,

2025 September 30,

(In thousands, except per share data)

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The following securities are considered antidilutive and have been excluded from the calculation of Diluted EPS:

Three Months Ended Nine Months Ended

2025 March 31,

2024 March 31,

2025 March 31,

Three Months Ended

September 30,

2025 September 30,

(In thousands)

Nonvested restricted stock units

$ 1,279 $ 1,056 $ 1,116 $ 868

Note 7 – Segment Information

We operate our business through three reportable segments:

We operate our business through a number of different operating subsidiaries, which are organized into three reportable segments based on the type of work performed and the markets serviced:

• Storage and Terminal Solutions :

primarily consists of engineering, procurement, fabrication, and construction services related to cryogenic and other specialty tanks and terminals for LNG, NGLs, hydrogen, ammonia, propane, butane, liquid nitrogen/liquid oxygen, and liquid petroleum.

primarily consists of engineering, procurement, fabrication, and construction services related to cryogenic and other specialty tanks and terminals for LNG, NGLs such as butane, propane, ethane, ethylene, and other liquid petroleum products, as well as hydrogen and ammonia.

We also perform work related to traditional aboveground crude oil and refined product storage tanks and terminals.

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We also perform power delivery work for public and private utilities, including construction of new substations, upgrades of existing substations, and maintenance.

We also provide construction services to a variety of power generation facilities, including natural gas fired facilities in simple or combined cycle configurations.

We also provide construction services to a variety of power generation facilities, including natural gas fired facilities in simple or combined cycle configurations for base load, peaking, and backup power supply.

• Process and Industrial Facilities :

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We also perform engineering, procurement, fabrication, and construction for refinery upgrades and retrofits for renewable fuels, including hydrogen processing, production, loading and distribution facilities.

We also engineer and construct thermal vacuum test chambers for aerospace and defense industries and other infrastructure for industries including chemicals, petrochemical, sulfur, mining and minerals primarily in the extraction of non-ferrous metals, cement, agriculture, wastewater treatment facilities and other industrial customers.

We evaluate performance and allocate resources based on operating income.

We also engineer and construct thermal vacuum test chambers for aerospace and defense industries and other infrastructure for industries including chemicals, petrochemical, sulfur, mining and minerals, cement, agriculture, wastewater treatment facilities and other industrial customers.

Our Chief Operating Decision Maker ("CODM") is our President and Chief Executive Officer, who regularly reviews operating and financial performance based on our segments.

The Company's CODM uses segment operating income as the key metric in evaluating segment performance.

The CODM uses this metric in the budget and forecasting processes.

The CODM considers budget-to-actual and forecast-to-actual variances when making decisions about allocating resources, including capital and personnel, to the segments.

We incur certain expenses at the corporate level that relate to our business as a whole.

A portion of these expenses are allocated to our business segments.

The balance of the corporate level expenses are reported in the Corporate "Selling, general and administrative expenses" line, which is primarily comprised of corporate facility expense, the cost of the executive management team, and other expenses pertaining to certain centralized functions that benefit the entire Company but are not directly attributable to any specific business segment, such as corporate human resources, legal, governance, compliance and finance functions.

The accounting policies of the segments are the same as those described in the Summary of Significant Accounting Policies (see Note 1).

We eliminate intersegment sales;

therefore, no intercompany profit or loss is recognized.

Corporate selling, general and administrative expenses, including corporate salaries and facilities costs, are excluded from our three reportable segments in order to align controllable costs with the responsibility of segment management, and to be consistent with how our chief operating decision-maker assesses segment performance and allocates resources.

Segment assets consist primarily of accounts receivable, costs and estimated earnings in excess of billings on uncompleted contracts, property, plant and equipment, right-of-use lease assets, goodwill and other intangible assets.

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Storage and Terminal Solutions Utility and Power Infrastructure Process and Industrial Facilities Corporate Total

Three Months Ended March 31, 2025

Total revenue (1)

$ 96,054 $ 58,676 $ 45,431 $ — $ 200,161

Cost of revenue ( 92,323 ) ( 53,139 ) ( 41,672 ) ( 177 ) ( 187,311 )

Gross profit (loss) 3,731 5,537 3,759 ( 177 ) 12,850

Selling, general and administrative expenses 6,344 2,536 2,142 6,704 17,726

Restructuring costs — 124 — — 124

Operating income (loss) $ ( 2,613 ) $ 2,877 $ 1,617 $ ( 6,881 ) $ ( 5,000 )

(1) Total revenues are net of inter-segment revenues which are primarily Process and Industrial Facilities and were $1.1 million for the three months ended March 31, 2025.

Storage and Terminal Solutions Utility and Power Infrastructure Process and Industrial Facilities Corporate Total

Three Months Ended March 31, 2024

Total revenue (1)

$ 54,304 $ 46,120 $ 65,589 $ — $ 166,013

Cost of revenue ( 51,991 ) ( 44,711 ) ( 63,822 ) 89 ( 160,435 )

Gross profit 2,313 1,409 1,767 89 5,578

Selling, general and administrative expenses 5,395 2,733 2,590 9,230 19,948

Operating income (loss) $ ( 3,082 ) $ ( 1,324 ) $ ( 823 ) $ ( 9,141 ) $ ( 14,370 )

(1) Total revenues are net of inter-segment revenues which are primarily Storage and Terminal Solutions and were $1.3 million for the three months ended March 31, 2024.

Storage and Terminal Solutions Utility and Power Infrastructure Process and Industrial Facilities Corporate Total

Nine Months Ended March 31, 2025

Three Months Ended September 30, 2025

Total revenue (1)

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Operating income (loss) $ ( 810 ) $ 3,167 $ ( 607 ) $ ( 7,250 ) $ ( 5,500 )

(1) Total revenues are net of inter-segment revenues which are primarily Process and Industrial Facilities and were $2.8 million for the nine months ended March 31, 2025.

(1) Total revenues are net of inter-segment revenues which are primarily Storage and Terminal Solutions and Process and Industrial Facilities and were $0.6 million for the three months ended September 30, 2025.

Capital expenditures $ 871 $ 851 $ 81 $ 208 $ 2,011

Depreciation and amortization $ 533 $ 92 $ 217 $ 1,619 $ 2,461

Storage and Terminal Solutions Utility and Power Infrastructure Process and Industrial Facilities Corporate Total

Nine Months Ended March 31, 2024

Three Months Ended September 30, 2024

Total revenue (1)

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Operating income (loss) $ ( 872 ) $ ( 2,669 ) $ 231 $ ( 7,457 ) $ ( 10,767 )

(1) Total revenues are net of inter-segment revenues which are primarily Storage and Terminal Solutions and were $3.1 million for the nine months ended March 31, 2024.

(1) Total revenues are net of inter-segment revenues which are primarily Storage and Terminal Solutions and Process and Industrial Solutions and were $0.9 million for the three months ended September 30, 2024.

Capital expenditures $ 1,047 $ 280 $ 139 $ 478 $ 1,944

Depreciation and amortization $ 522 $ 92 $ 168 $ 1,733 $ 2,515

Total assets by segment

March 31, 2025 June 30, 2024

September 30, 2025 June 30, 2025

Storage and Terminal Solutions $ 209,625 $ 194,354

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Total Segment Assets $ 598,186 $ 600,256

Note 8 – Restructuring Costs

In the fourth quarter of fiscal 2025, we commenced an organizational restructuring plan to create a flatter, leaner organization by eliminating certain senior-level positions, streamlining our engineering and construction services, and decentralizing elements of our business development organization.

As a result of this restructuring we incurred certain costs, consisting primarily of severance and other personnel-related costs, which totaled $ 3.6 million for fiscal year 2025.

In the first quarter of fiscal 2026, we continued the organizational restructuring plan to further integrate our engineering and construction services, consolidate service lines, and close an under-performing office, among other changes.

We incurred $ 3.3 million of restructuring costs during the first quarter of fiscal 2026 associated with these actions.

These costs included $ 1.5 million of operating lease and fixed asset impairments associated with certain real estate leases that we exited as part of our restructuring plan.

The fair values of the assets associated with these leases were determined based on Level 3 fair value measurements, utilizing a discounted cash flow method based in part on projected sublease income.

Remaining costs incurred during the first quarter of fiscal 2026 consisted primarily of severance and other personnel-related costs.

Our restructuring plan was substantially complete as of September 30, 2025.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements