What changed in this filing

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Item 2. Management’s Discussion and Analysis

2026-07-29 compared with 2026-04-29 · 96 added, 53 removed, 108 unchanged (58% of the section changed)

20 unchanged sentences

Specialty services include design, salvage, demolition, surveying, towing, diving and underwater inspection, excavation and repair.

We also perform engineering design, analysis, and consulting projects for both internal and external clients.

Our concrete segment provides turnkey concrete construction services, including concrete surface place and finish, site preparation, layout, forming, and rebar placement for large commercial, structural and other associated business areas.

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Backlog as of the periods ended below were as follows (in millions):

March 31, 2026

June 30, 2026

December 31, 2025

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Income Statement Comparisons

Three months ended March 31, 2026 compared with three months ended March 31, 2025

Three Months Ended March 31,

Three months ended June 30, 2026 compared with three months ended June 30, 2025

Three Months Ended June 30,

(dollar amounts in thousands)

2 unchanged sentences

Selling, general and administrative expenses

Amortization of intangible assets

Gain on disposal of assets, net

3 unchanged sentences

Other expense, net

(Loss) income before income taxes

Income tax expense (benefit)

Net (loss) income

Contract Revenues.

Contract revenues for the three months ended June 30, 2026 of $221.9 million increased $16.6 million, or 8%, as compared to $205.3 million in the prior year period.

The increase was driven by the concrete segment, reflecting strong demand, new project awards and higher volumes.

This increase was partially offset by a reduction in marine revenue, primarily attributable to the timing of project start-ups due to client-related issues such as site readiness and timing of delivery of client-provided materials.

Gross Profit.

Gross profit was $22.9 million for the three months ended June 30, 2026 compared to $25.8 million in the prior year period, a decrease of $2.9 million, or 11%.

The decrease was primarily driven by lower marine volume and equipment utilization.

The decrease was partially offset by favorable project execution within the concrete segment.

Selling, General and Administrative Expenses.

Selling, general and administrative (“SG&A”) expenses were $24.4 million for the three months ended June 30, 2026 compared to $22.8 million in the prior year period, an increase of $1.6 million or 7%.

The increase in SG&A was primarily attributable to costs to support business growth.

Gain on Disposal of Assets, net.

During the three months ended June 30, 2026 and 2025, we realized net gains on disposal of assets of $0.2 million and $0.4 million, respectively.

Other Expense, net.

Other expense primarily reflects interest on our borrowings, partially offset by interest income.

Income Tax Expense (Benefit).

We recorded tax expense of $0.5 million in the three months ended June 30, 2026, compared to a tax benefit of $0.2 million in the prior year period.

Six months ended June 30, 2026 compared with six months ended June 30, 2025

Six Months Ended June 30,

(dollar amounts in thousands)

Contract revenues

Cost of contract revenues

Selling, general and administrative expenses

Gain on disposal of assets, net

Operating (loss) income

Other (expense) income:

Interest expense

Other expense, net

Loss before income taxes

Income tax (benefit) expense

Income tax benefit

Net income (loss)

Contract Revenues.

Contract revenues for the three months ended March 31, 2026 of $216.3 million increased $27.6 million, or 15%, as compared to $188.7 million in the prior year period.

The increase was primarily due to strong momentum and expansion of services in the concrete segment, partially offset by a decrease in revenue in our marine segment.

Contract revenues for the six months ended June 30, 2026 of $438.2 million increased $44.3 million, or 11%, as compared to $393.9 million in the prior year period.

The increase was primarily due to the concrete segment, reflecting strong demand, new project awards, and higher volumes.

This increase was partially offset by a reduction in marine revenue, primarily attributable to the timing of project start-ups.

Gross Profit.

Gross profit was $25.9 million for the three months ended March 31, 2026 compared to $23.0 million in the prior year period, an increase of $2.9 million, or 12%.

The increase in gross profit was primarily driven by the increase in revenue, strong project execution and favorable completions.

Selling, General and Administrative Expense.

Selling, general and administrative (“SG&A”) expenses were $26.3 million for the three months ended March 31, 2026 compared to $22.5 million in the prior year period, an increase of $3.8 million or 16.7%.

The increase in SG&A was primarily to support business growth and the closing of the JEM Acquisition during the quarter.

Gross profit was $48.8 million for both the six months ended June 30, 2026 and in the prior year period.

While revenues increased during the same periods, revenue mix and lower equipment utilization in our marine segment caused gross profit to remain flat.

Selling, General and Administrative Expenses.

SG&A expenses were $51.1 million for the six months ended June 30, 2026 compared to $45.3 million in the prior year period, an increase of $5.8 million or 13%.

The increase in SG&A was due to costs associated with the JEM Acquisition and other costs to support business growth.

Gain on Disposal of Assets, net.

During the three months ended March 31, 2026 and 2025, we realized less than $0.1 million and $0.4 million, respectively, of net gains on disposal of assets.

Other Expense, net of Income.

During the six months ended June 30, 2026 and 2025, we realized net gains on disposal of assets of $0.2 million and $0.8 million, respectively.

Other Expense, net.

Other expense primarily reflects interest on our borrowings, partially offset by interest income.

Income Tax (Benefit) Expense.

We recorded a tax benefit of $6.9 million in the three months ended March 31, 2026, compared to tax expense of $0.1 million in the prior year period.

The tax benefit for the three months ended March 31, 2026 primarily relates to a decrease in the valuation allowance attributable to the recognition of the deferred tax liabilities arising from the fair value adjustments recorded as part of the JEM

Income Tax Benefit.

We recorded a tax benefit of $6.4 million in the six months ended June 30, 2026, compared to $0.1 million in the prior year period.

The tax benefit for the six months ended June 30, 2026 primarily relates to a decrease in the valuation allowance attributable to the recognition of the deferred tax liabilities arising from the fair value adjustments recorded as part of the JEM Acquisition.

These deferred tax liabilities represent a source of future taxable income that supports the realizability of the Company’s deferred tax assets.

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The following table sets forth, for the periods indicated, statements of operations data by segment, segment revenues as a percentage of consolidated revenues and segment operating income (loss) as a percentage of segment revenues.

Three months ended March 31, 2026 compared with three months ended March 31, 2025

Three Months Ended March 31,

Three months ended June 30, 2026 compared with three months ended June 30, 2025

Three Months Ended June 30,

(dollar amounts in thousands)

1 unchanged sentence

Marine segment

Public sector

Private sector

Marine segment total

Concrete segment

Public sector

Private sector

Concrete segment total

Operating income (loss)

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Marine Segment

Revenues for our marine segment for the three months ended March 31, 2026 were $110.1 million compared to $127.2 million for the three months ended March 31, 2025.

Operating income for our marine segment for the three months ended March 31, 2026 was $6.6 million, compared to $12.3 million for the three months ended March 31, 2025.

The decreases was primarily driven by the timing of project completions and new project starts during the quarter.

Revenues for our marine segment for the three months ended June 30, 2026 were $130.8 million compared to $135.3 million for the three months ended June 30, 2025.

Operating income for our marine segment for the three months ended June 30, 2026 was $7.7 million, compared to $13.7 million for the three months ended June 30, 2025.

Marine revenue and operating income were down primarily due to the delays of project start-ups and lower equipment utilization.

Concrete Segment

Revenues for our concrete segment for the three months ended March 31, 2026 were $106.2 million compared to $61.5 million for the three months ended March 31, 2025.

Operating income for our concrete segment for the three months ended March 31, 2026 was $7.7 million, compared to operating income of $1.8 million for the three months ended March 31, 2025.

The increase was primarily driven by an expansion of services and strong project execution during the quarter.

Revenues for our concrete segment for the three months ended June 30, 2026 were $91.0 million compared to $70.0 million for the three months ended June 30, 2025.

Operating income for our concrete segment for the three months ended June 30, 2026 was $4.2 million, compared to operating income of $2.6 million for the three months ended June 30, 2025.

The increases were primarily driven by robust demand, an expansion into site civil services and strong project execution.

Six months ended June 30, 2026 compared with six months ended June 30, 2025

Six Months Ended June 30,

(dollar amounts in thousands)

Contract revenues

Marine segment

Concrete segment

Operating income (loss)

Marine segment

Concrete segment

General corporate

Marine Segment

Revenues for our marine segment for the six months ended June 30, 2026 were $241.0 million compared to $262.5 million for the six months ended June 30, 2025.

Operating income for our marine segment for the six months ended June 30, 2026 was $14.3 million, compared to $26.0 million for the six months ended June 30, 2025.

Marine revenue and operating income were down primarily due to delays in project start-ups and lower equipment utilization.

Concrete Segment

Revenues for our concrete segment for the six months ended June 30, 2026 were $197.2 million compared to $131.5 million for the six months ended June 30, 2025.

Operating income for our concrete segment for the six months ended June 30, 2026 was $11.9 million, compared to operating income of $4.4 million for the six months ended June 30, 2025.

The increases were primarily driven by robust demand, an expansion into site civil services and strong project execution.

Liquidity and Capital Resources

Changes in working capital are normal within our business given the varying mix in size, scope, seasonality and timing of delivery of our projects.

At March 31, 2026, our working capital was $76.2 million, as compared to $74.3 million at December 31, 2025.

As of March 31, 2026, we had unrestricted cash on hand of $6.3 million.

Our borrowing availability under the revolving portion of our UMB Credit Agreement at March 31, 2026 was approximately $45.6 million.

At June 30, 2026, our working capital was $92.0 million, as compared to $74.3 million at December 31, 2025.

As of June 30, 2026, we had unrestricted cash on hand of $2.5 million.

Our borrowing availability under the revolving portion of our UMB Credit Agreement at June 30, 2026 was approximately $22.6 million.

Our primary liquidity needs are to finance our working capital and fund capital expenditures.

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The assessment of our liquidity requires us to make estimates of future activity and judgments about whether we are compliant with financial covenant calculations under our debt and other agreements and have adequate liquidity to operate.

Significant assumptions used in our forecasted model of liquidity include forecasted sales, costs, and capital expenditures, as well as expected timing and proceeds of planned asset sale transactions.

As of March 31, 2026, management believes the Company will have adequate liquidity for its operations for at least the next 12 months.

The following table provides information regarding our cash flows and our capital expenditures for the three months ended March 31, 2026 and 2025 (in thousands):

Three Months Ended

Significant assumptions used in our forecasted model of liquidity include forecasted sales, costs, and capital expenditures, as well as expected

timing and proceeds of planned asset sale transactions.

As of June 30, 2026, management believes the Company will have adequate liquidity for its operations for at least the next 12 months.

The following table provides information regarding our cash flows and our capital expenditures for the six months ended June 30, 2026 and 2025 (in thousands):

Six Months Ended

Net income (loss)

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Change in operating assets and liabilities (working capital)

Cash flows provided by (used in) operating activities

Cash flows used in operating activities

Cash flows used in investing activities

Cash flows provided by (used in) financing activities

Capital expenditures (included in financing activities above)

Capital expenditures (included in investing activities above)

Operating Activities.

During the three months ended March 31, 2026, we generated approximately $4.9 million of cash in our operating activities.

The net cash inflow was comprised of $7.1 million of cash inflows from net income, after adjusting for non-cash and non-operating items, partially offset by $2.1 million of outflows related to changes in net working capital.

The changes in net working capital, which are reflected as changes in operating assets and liabilities in our Condensed Consolidated Statements of Cash Flows, were primarily driven by a $8.0 million cash inflow related to a decrease in our net positions of accounts receivable, accounts payable, and accrued liabilities during the period and a $2.6 million decrease in prepaid expenses.

This was partially offset by $11.1 million of cash outflows pursuant to the relative timing and significance of project progression and billings during the period and a $1.5 million decrease in operating lease liabilities.

During the six months ended June 30, 2026, we used approximately $12.7 million of cash in our operating activities.

The net cash outflow was comprised of $14.6 million of cash inflows from net income, after adjusting for non-cash and non-operating items, offset by $27.3 million of outflows related to changes in net working capital.

The changes in net working capital, which are reflected as changes in operating assets and liabilities in our Condensed Consolidated Statements of Cash Flows, were primarily driven by a $56.6 million outflow pursuant to the relative timing and significance of project progression and billings during the period and a $3.1 million decrease in operating lease liabilities and $0.8 million of other outflows, partially offset by a $30.7 million cash inflow related to a decrease in our net positions of accounts receivable, accounts payable, and accrued liabilities during the period and a $2.5 million decrease in prepaid expenses.

Investing Activities.

During the three months ended March 31, 2026, we used approximately $52.1 million of cash in our investing activities.

Cash used in investing activities relating to the JEM Acquisition totaled $44.0

million in the three months ended March 31, 2026.

Capital asset additions and betterments to our fleet were $8.6 million and $9.0 million in the three months ended March 31, 2026 and 2025, respectively.

During the six months ended June 30, 2026, we used approximately $62.3 million of cash in our investing activities.

Cash used in investing activities relating to the JEM Acquisition totaled $42.9 million in the six months ended June 30, 2026.

Capital asset additions and betterments to our fleet were $20.1 million and $16.2 million in the six months ended June 30, 2026 and 2025, respectively.

Financing Activities.

During the three months ended March 31, 2026, we used approximately $52.3 million of cash in our financing activities.

During the three months ended March 31, 2026, we had net borrowings of $13.0 million on the UMB revolving credit line and borrowings of $40.0 million related to the JEM Acquisition.

Sources of Capital

On December 23, 2025, we entered into the five-year $120 million UMB Credit Agreement, which includes a $60 million asset based revolving credit line, a $40 acquisition term loan, and a $20 million equipment term loan.

We were in compliance with all financial covenants under the UMB Credit Agreement as of March 31, 2026.

During the six months ended June 30, 2026, we were provided approximately $75.9 million of cash by our financing activities.

During the six months ended June 30, 2026, we had net borrowings of $36.0 million on the UMB revolving credit line, borrowings of $40.0 million related to the JEM Acquisition and borrowings of $2.0 million related to the UMB equipment line of credit.

Effect of Inflation

1 unchanged sentence

Due to the relative short-term duration of our projects, we are generally able to include anticipated cost increases in the pricing of our bids.

Critical Accounting Estimates

Refer to our 2025 Form 10-K for a description of our critical accounting estimates that require us to make estimates and assumptions that affect both the Company’s carrying values of its assets and liabilities, and the reported amounts of revenues and expenses during the reporting period.

There have been no material changes or developments during the reporting period with respect to methodologies that we used when developing critical accounting estimates as disclosed in our 2025 Form 10-K.

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 2. Management’s Discussion and Analysis