Business Overview

Concrete Pumping Holdings, Inc. is a Delaware corporation headquartered in Thornton, Colorado. The company operates through three main business segments:

1. U.S. Concrete Pumping: Provides concrete pumping services in the U.S. commercial, infrastructure and residential sectors. Has around 90 branch locations across 22 states.

2. U.S. Concrete Waste Management Services: Consists of the Eco-Pan business, which provides industrial cleanup and containment services, primarily to construction customers. Has 20 operating locations across the U.S.

3. U.K. Operations: Includes the Camfaud concrete pumping business and Eco-Pan operations in the U.K. Camfaud has around 35 branch locations throughout the U.K.

The company views strategic acquisitions as opportunities to enhance its value proposition and competitiveness. It plans to allocate capital for opportunistic M&A using cash on hand and its revolving credit facility.

Financial Performance

Revenue

Total revenue for the first quarter of fiscal 2025 was $86.4 million, down 11.5% from $97.7 million in the same period of fiscal 2024.

• U.S. Concrete Pumping revenue decreased 14.6% to $56.9 million, primarily due to lower volumes from heavy rainfall, colder temperatures, and a slowdown in commercial construction.

• U.S. Concrete Waste Management Services revenue increased 6.9% to $16.7 million, driven by organic growth and pricing improvements.

• U.K. Operations revenue decreased 16.7% to $12.8 million, also due to lower volumes from the commercial construction slowdown.

Gross Profit and Margin

Gross profit was $31.2 million, down 6.2% from $33.3 million. Gross margin improved to 36.1% from 34.1%, mainly due to lower fuel and insurance costs.

General and Administrative Expenses

G&A expenses decreased $4.1 million to $27.8 million, or 32.2% of revenue, from $31.9 million (32.7% of revenue) in the prior year period. The decrease was driven by lower amortization, labor costs, and the absence of a $3.5 million sales tax litigation charge.

Net Income and Adjusted EBITDA

• U.S. Concrete Pumping net loss improved slightly to $3.1 million, while Adjusted EBITDA decreased 21.0% to $9.2 million.

• U.S. Concrete Waste Management Services net income was $0.2 million, up from a $1.2 million loss, and Adjusted EBITDA increased 12.0% to $5.0 million.

• U.K. Operations net income was $0.2 million, down from $0.5 million, and Adjusted EBITDA decreased 11.7% to $2.8 million.

Liquidity and Capital Resources

As of January 31, 2025, the company had $85.1 million in cash and $324.5 million in available borrowing capacity under its $350 million revolving credit facility, providing total liquidity of $409.6 million.

The company believes its existing cash, cash flow from operations, and borrowing capacity will be sufficient to meet its working capital and capital expenditure needs for at least the next 12 months.

Key uses of cash include:

• Operating activities and working capital
• Purchases of property and equipment (capex of $5.8 million in Q1 2025)
• Strategic acquisitions
• Lease payments
• Share repurchases ($1.9 million in Q1 2025)
• Dividend payments ($53.1 million special dividend declared in January 2025)

To service its debt, the company has $425 million in senior secured second lien notes due 2032 at a 7.5% interest rate. It also has an amended $350 million revolving credit facility maturing in 2029.

Strengths and Weaknesses

Strengths:

• Diversified business model across concrete pumping, waste management, and U.K. operations
• Strong liquidity position with $409.6 million in available cash and credit
• Improving gross margins from cost savings
• Growth in U.S. Concrete Waste Management Services segment

Weaknesses:

• Declining revenue and profitability in U.S. Concrete Pumping and U.K. Operations due to macroeconomic headwinds
• High debt load with $425 million in senior notes
• Reliance on commercial construction activity, which has slowed

Outlook

The company faces near-term challenges from the slowdown in commercial construction activity, which has impacted its core concrete pumping business in the U.S. and U.K. However, its diversified operations, strong liquidity, and focus on cost management should help it weather the current economic conditions.

The company’s ability to execute strategic acquisitions and continue growing its higher-margin waste management services will be key to driving long-term growth and profitability. Maintaining financial discipline around capital allocation and debt management will also be critical.

Overall, the company appears well-positioned to navigate the current environment, but will need to closely monitor market conditions and be prepared to adapt its strategy as needed.