What changed in this filing

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Item 1. Financial Statements

2026-02-05 compared with 2025-11-06 · 138 added, 71 removed, 325 unchanged (39% of the section changed)

3 unchanged sentences

(In thousands, except per share data)

Three Months Ended

September 30, 2025 September 30, 2024

Three Months Ended Six Months Ended

December 31, 2025 December 31, 2024 December 31, 2025 December 31, 2024

Revenue $ 210,508 $ 187,169 $ 422,392 $ 352,748

7 unchanged sentences

Interest income 1,543 1,578 3,345 3,150

Other 23 ( 556 ) 254 ( 495 )

Loss before income tax expense ( 731 ) ( 5,517 ) ( 4,325 ) ( 14,740 )

10 unchanged sentences

(In thousands)

Three Months Ended

September 30,

2025 September 30,

Three Months Ended Six Months Ended

2025 December 31,

2024 December 31,

2025 December 31,

Net loss $ ( 894 ) $ ( 5,533 ) $ ( 4,557 ) $ ( 14,756 )

Other comprehensive income (loss), net of tax:

Foreign currency translation gain (loss) ( 528 ) 436

Foreign currency translation loss ( 6 ) ( 1,363 ) ( 534 ) ( 927 )

Comprehensive loss $ ( 900 ) $ ( 6,896 ) $ ( 5,091 ) $ ( 15,683 )

3 unchanged sentences

(In thousands)

September 30,

2025 June 30,

6 unchanged sentences

Prepaid expenses and other current assets 10,938 4,347

Assets held for sale (Note 3) 2,019 —

Total current assets 450,014 419,773

10 unchanged sentences

(In thousands, except share data)

September 30,

2025 June 30,

16 unchanged sentences

60,000,000 shares authorized;

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

28,124,527 shares issued and outstanding at December 31, 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 147,297 149,969

Retained earnings 816 4,479

Retained earnings (accumulated deficit) ( 78 ) 4,479

Accumulated other comprehensive loss ( 9,937 ) ( 9,403 )

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

Treasury stock, at cost — 0 shares as of December 31, 2025 and 277,731 shares as of June 30, 2025;

Total stockholders' equity 137,563 142,716

4 unchanged sentences

(In thousands)

Three Months Ended

September 30,

2025 September 30,

Six Months Ended

2025 December 31,

Operating activities:

4 unchanged sentences

Operating lease impairment due to restructuring 1,529 —

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

Gain on disposal of property, plant and equipment ( 327 ) ( 64 )

Other 339 ( 19 )

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

36 unchanged sentences

Shares Amount Shares Amount Total

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

Three Months Ended December 31, 2025

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

Net loss — — — ( 894 ) — — — ( 894 )

1 unchanged sentence

Issuance of restricted stock 49,740 — — — — — — —

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

Shares issued related to employee stock purchase plan 4,360 — 55 — — — — 55

Stock-based compensation expense — — 2,142 — — — — 2,142

December 31, 2025 28,124,527 $ 281 $ 147,297 $ ( 78 ) $ ( 9,937 ) — $ — $ 137,563

Three Months Ended December 31, 2024

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

Net loss — — — ( 5,533 ) — — — ( 5,533 )

Other comprehensive loss — — — — ( 1,363 ) — — ( 1,363 )

Issuance of restricted stock — — ( 428 ) — — ( 47,946 ) 428 —

Treasury shares sold to Employee Stock Purchase Plan — — 14 — — ( 4,677 ) 42 56

Stock-based compensation expense — — 2,257 — — — — 2,257

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

Common Stock Additional

Capital Retained

Earnings Accumulated

Comprehensive

Loss Treasury Stock

Shares Amount Shares Amount Total

Six Months Ended December 31, 2025

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

Net loss — — — ( 4,557 ) — — — ( 4,557 )

Other comprehensive income — — — — 436 — — 436

Other comprehensive loss — — — — ( 534 ) — — ( 534 )

Issuance of restricted stock 231,950 2 ( 6,805 ) — — ( 274,578 ) 2,580 ( 4,223 )

Shares issued related to employee stock purchase plan 4,360 — 70 — — ( 3,153 ) 28 98

Stock-based compensation expense — — 4,063 — — — — 4,063

December 31, 2025 28,124,527 $ 281 $ 147,297 $ ( 78 ) $ ( 9,937 ) — $ — $ 137,563

Six Months Ended December 31, 2024

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

Net loss — — — ( 14,756 ) — — — ( 14,756 )

Other comprehensive loss — — — — ( 927 ) — — ( 927 )

Issuance of restricted stock — — ( 4,537 ) — — ( 408,406 ) 4,537 —

Treasury shares sold to Employee Stock Purchase Plan — — ( 3 ) — — ( 9,474 ) 105 102

1 unchanged sentence

Stock-based compensation expense — — 4,568 — — — — 4,568

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

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

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

The results of operations for the three and six month periods ended December 31, 2025 may not necessarily be indicative of the results of operations for the full year ending June 30, 2026.

Significant Accounting Policies

11 unchanged sentences

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 September 30, 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 December 31, 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 $ 958.3 million of remaining performance obligations yet to be satisfied as of September 30, 2025.

We had $ 1.0 billion of remaining performance obligations yet to be satisfied as of December 31, 2025.

We expect to recognize $ 686.4 million of our remaining performance obligations as revenue within the next twelve months.

5 unchanged sentences

CIE consists of revenue recognized in excess of billings.

We present our contract liabilities in the balance sheet as Billings on Uncompleted Contracts in Excess of Costs and Estimated Earnings ("BIE").

We present our contract liabilities in the balance sheet as Billings on Uncompleted Contracts in Excess of

Costs and Estimated Earnings ("BIE").

BIE consists of billings in excess of revenue recognized.

The following table provides information about CIE and BIE:

September 30,

2025 June 30,

4 unchanged sentences

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.

The amount of revenue recognized during the six months ended December 31, 2025 that was included in the June 30, 2025 BIE balance was $ 224.9 million.

Progress billings in accounts receivable at December 31, 2025 and June 30, 2025 included retentions to be collected within one year of $ 26.5 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 $ 87.5 million as of December 31, 2025 and $ 61.5 million as of June 30, 2025, respectively.

Unpriced Change Orders and Claims

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.

Costs and estimated earnings in excess of billings on uncompleted contracts included revenues for unpriced change orders and claims of $ 8.9 million at December 31, 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.

5 unchanged sentences

Geographic Disaggregation:

Three Months Ended

September 30,

2025 September 30,

Three Months Ended Six Months Ended

2025 December 31,

2024 December 31,

2025 December 31,

(In thousands)

4 unchanged sentences

Contract Type Disaggregation:

Three Months Ended

September 30,

2025 September 30,

Three Months Ended Six Months Ended

2025 December 31,

2024 December 31,

2025 December 31,

(In thousands)

2 unchanged sentences

Total Revenue $ 210,508 100 % $ 187,169 100 % $ 422,392 100 % $ 352,748 100 %

Revisions in Estimates

We recognize changes in contract estimates on a cumulative catch-up basis in the period in which the changes are identified.

Such changes in contract estimates can result in the recognition of revenue in a current period for performance obligations which were satisfied or partially satisfied in prior period.

Changes in contract estimates may also result in the reversal of previously recognized revenue if the current estimate differs from the previous estimate.

If at any time the estimate of contract profitability indicates an anticipated loss on the contract, we recognize the total loss in the period it is identified.

During the second quarter of fiscal 2026, costs associated with warranty-type items and third-party commercial matters arising during commissioning of specialty tank work in the Storage and Terminal Solutions segment resulted in a $3.6 million reduction of gross profit.

We anticipate completing this work during fiscal 2026.

Note 3 – Assets Held for Sale

As of December 31, 2025, we classified $2.0 million of property, plant and equipment as held for sale.

The assets include primarily transportation equipment associated with our transmission and distribution service line in the Utility and Power Infrastructure segment.

We began winding down this service line in the fourth quarter of fiscal 2025.

We expect to sell this equipment during the remainder of fiscal 2026.

Note 4 – Debt

9 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 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.

The borrowing base is recalculated on a monthly basis and at December 31, 2025, our borrowing base was $ 63.1 million.

The Company had $ 4.5 million in letters of credit outstanding as of December 31, 2025, which resulted in availability of $ 58.6 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.

20 unchanged sentences

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 September 30, 2025.

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

Note 5 – Income Taxes

Effective Tax Rate

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

During the three and six months ended December 31, 2025, our effective tax rates were ( 22.3 )% and ( 5.4 )%.

The effective tax rates during both periods were impacted by valuation allowances of $( 0.7 ) million and $ 0.6 million, respectively, placed on deferred tax assets generated during the quarters.

During the three and six months ended December 31, 2024, our effective tax rates were ( 0.3 )% and ( 0.1 )%, respectively.

The effective tax rates during both periods were impacted by valuation allowances of $ 1.8 million and $ 3.1 million, respectively, placed on deferred tax assets generated during the quarters.

Valuation Allowance

7 unchanged sentences

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

Insurance Reserves

We maintain insurance coverage for various aspects of our operations.

However, we retain exposure to potential losses through the use of deductibles, self-insured retentions and coverage limits.

Typically our contracts require us to indemnify our customers for injury, damage or loss arising from the performance of our services and provide warranties for materials and workmanship.

We may also be required to name the customer as an additional insured up to the limits of insurance available, or we may be required to purchase special insurance policies or surety bonds for specific customers or provide letters of credit in lieu of bonds to satisfy performance and financial guarantees on some projects.

We maintain a performance and payment bonding line sufficient to support the business.

We generally require our subcontractors to indemnify us and our customer and name us as an additional insured for activities arising out of the subcontractors’ work.

We also require certain subcontractors to provide additional insurance policies, including surety bonds in favor of us, to secure the subcontractors’ work or as required by the subcontract.

There can be no assurance that our insurance and the additional insurance coverage provided by our subcontractors will fully protect us against a valid claim or loss under the contracts with our customers.

In January 2021, we achieved mechanical completion on a crude oil storage project.

On April 1, 2022, we filed an arbitration demand against Keyera Energy, Inc.

in an effort to collect outstanding balances of $ 32.7 million related to the project.

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 up to $ 97.9 million.

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.

in an effort to collect outstanding balances related to the project.

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

As part of the arbitration process, our claim amount was specified at $ 24.5 million and Keyera's counterclaim was specified at $ 72.9 million , with both claim amounts including interest.

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.

We received an interim award in January 2026, awarding us $ 15.1 million for our claims.

Keyera was awarded $ 12.1 million for their claims, a majority of which is subject to certain of our insurance coverages.

Applications for the calculation of interest and the award of attorneys' fees and costs are due in February 2026.

A final decision for all issues is expected in April 2026.

We expect to collect our outstanding receivable in the fourth quarter of fiscal 2026 or the first quarter of fiscal 2027.

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

5 unchanged sentences

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.

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

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.

2 unchanged sentences

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.

Insurance Reserves

We maintain insurance coverage for various aspects of our operations.

However, we retain exposure to potential losses through the use of deductibles, self-insured retentions and coverage limits.

Typically our contracts require us to indemnify our customers for injury, damage or loss arising from the performance of our services and provide warranties for materials and workmanship.

We generally require our subcontractors to indemnify us and our customer and name us as an additional insured for activities arising out of the subcontractors’ work.

We also require certain subcontractors to provide additional insurance policies, including surety bonds in favor of us, to secure the subcontractors’ work or as required by the subcontract.

Note 7 – Earnings per Common Share

Basic earnings per share (“EPS”) is calculated based on the weighted average shares outstanding during the period.

Diluted earnings per share includes the dilutive effect of employee and director nonvested restricted stock units.

Diluted EPS includes the dilutive effect of employee and director nonvested restricted stock units.

Nonvested restricted stock units are considered dilutive (antidilutive) to our EPS whenever the average market value of the shares during the period exceeds (is less than) the sum of the related average unamortized compensation expense during the period plus the related hypothetical estimated excess tax benefit that will be realized when the shares vest.

1 unchanged sentence

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

Three Months Ended

September 30,

2025 September 30,

Three Months Ended Six Months Ended

2025 December 31,

2024 December 31,

2025 December 31,

(In thousands, except per share data)

6 unchanged sentences

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

Three Months Ended

September 30,

2025 September 30,

Three Months Ended Six Months Ended

2025 December 31,

2024 December 31,

2025 December 31,

(In thousands)

Nonvested restricted stock units

$ 359 $ 917 $ 594 $ 926

Note 8 – Segment Information

24 unchanged sentences

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.

Corporate assets consist primarily of cash, restricted cash, prepaid expenses, corporate fixed assets, and corporate operating lease right-of-use assets.

Corporate assets consist primarily of centrally managed cash, restricted cash, prepaid expenses, corporate fixed assets, and corporate operating lease right-of-use assets.

Segment Information - The following tables set forth certain selected financial information for our segments for the periods indicated:

1 unchanged sentence

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

Three Months Ended September 30, 2025

Three Months Ended December 31, 2025

Total revenue (1)

5 unchanged sentences

Operating income (loss) $ ( 788 ) $ 4,952 $ ( 401 ) $ ( 5,942 ) $ ( 2,179 )

(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.

(1) Total revenues are net of inter-segment revenues which are primarily Storage and Terminal Solutions and were $0.9 million for the three months ended December 31, 2025.

Capital expenditures $ 343 $ 329 $ — $ 504 $ 1,176

1 unchanged sentence

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

Three Months Ended September 30, 2024

Three Months Ended December 31, 2024

Total revenue (1)

4 unchanged sentences

Operating income (loss) $ 1,705 $ ( 152 ) $ ( 1,307 ) $ ( 6,640 ) $ ( 6,394 )

(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.

(1) Total revenues are net of inter-segment revenues which are primarily Process and Industrial Solutions and were $0.8 million for the three months ended December 31, 2024.

Capital expenditures $ 663 $ 133 $ 3 $ 116 $ 915

Depreciation and amortization $ 520 $ 92 $ 167 $ 1,731 $ 2,510

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

Six Months Ended December 31, 2025

Total revenue (1)

$ 209,311 $ 149,907 $ 63,174 $ — $ 422,392

Cost of revenue ( 198,060 ) ( 135,895 ) ( 60,526 ) ( 594 ) ( 395,075 )

Gross profit (loss) 11,251 14,012 2,648 ( 594 ) 27,317

Selling, general and administrative expenses 10,971 5,219 2,880 12,376 31,446

Restructuring costs 1,878 674 776 222 3,550

Operating income (loss) $ ( 1,598 ) $ 8,119 $ ( 1,008 ) $ ( 13,192 ) $ ( 7,679 )

(1) Total revenues are net of inter-segment revenues which are primarily Storage and Terminal Solutions and were $1.6 million for the six months ended December 31, 2025.

Capital Expenditures $ 1,214 $ 1,180 $ 81 $ 712 $ 3,187

Depreciation and amortization $ 1,040 $ 170 $ 409 $ 3,074 $ 4,693

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

Six Months Ended December 31, 2024

Total revenue (1)

$ 173,746 $ 116,988 $ 62,014 $ — $ 352,748

Cost of revenue ( 161,777 ) ( 112,272 ) ( 59,647 ) ( 347 ) ( 334,043 )

Gross profit (loss) 11,969 4,716 2,367 ( 347 ) 18,705

Selling, general and administrative expenses 11,136 7,537 3,443 13,750 35,866

Operating income (loss) $ 833 $ ( 2,821 ) $ ( 1,076 ) $ ( 14,097 ) $ ( 17,161 )

(1) Total revenues are net of inter-segment revenues which are primarily Process and Industrial Facilities and were $1.7 million for the six months ended December 31, 2024.

Capital Expenditures $ 1,710 $ 413 $ 142 $ 594 $ 2,859

Depreciation and amortization $ 1,042 $ 185 $ 335 $ 3,463 $ 5,025

Total assets by segment

September 30, 2025 June 30, 2025

December 31, 2025 June 30, 2025

Storage and Terminal Solutions $ 152,551 $ 194,354

6 unchanged sentences

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.

In 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 $ 3.6 million of restructuring costs during the six months ended December 31, 2025 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.

Remaining costs incurred during 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