The following is a summary of the North American Construction Group Ltd. (NOA) Q1 2024 Earnings Call Transcript:
Financial Performance:
North American Construction Group reported a Q1 EBITDA of $93 million with a margin of 27%, and a combined gross profit margin of 18%.
The firm reported a $0.78 adjusted earnings per share for Q1, down from $0.18 in Q1 of 2023 due to increased interest rates.
Net cash from operations, prior to working capital, was $74 million while net debt levels rested at $781 million by the end of this quarter.
The company is working on decreasing its debt-to-EBITDA ratio to 1.5x by year-end, with a projected free cash flow of $160 million to $185 million identified for this purpose.
Business Progress:
The company reported a good performance from its recently acquired Australian business, a successful start on the Fargo-Moorhead flood diversion project, and significant savings through the application of a telematics system.
Safety standards are being improved with a focus on frontline leadership training, the betterment of the peer-to-peer recognition program, and increased field leadership visibility.
North American Construction Group is targeting an expansion of operational efficiency and maintenance expertise, alongside winning on strategic projects.
There is a continued focus on growth across all commodity markets (excluding nickel and lithium) with strong business in iron ore, gold, and coal markets.
The company has successfully completed the restructuring process for Nuna, which is expected to yield stronger earnings by summer.
The company is bidding for an iron ore mine in Quebec, which if successful, would significantly raise their revenue.
North American Construction Group is also concentrating on improving their balance sheet to make way for bigger projects by year end.
More details: North American Construction IR
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