L B Foster Co (FSTR) 2025 Q1 法說會逐字稿

Good day, and thank you for standing by. Welcome to the L.B. Foster first quarter 2025 earnings conference call. (Operator Instructions) Please be advised that today's conference is being recorded.

您好，感謝您的支持。歡迎參加 L.B. Foster 2025 年第一季財報電話會議。（操作員指示）請注意，今天的會議正在錄音。

I would now like to turn the conference over to your speaker for today, Lisa Durante. Please go ahead.

現在我想將會議交給今天的發言人麗莎杜蘭特 (Lisa Durante)。請繼續。

Thank you, operator. Good morning, everyone, and welcome to L.B. Foster's first quarter of 2025 earnings call. My name is Lisa Durante, the company's Director of Financial Reporting. Our President and CEO, John Kasel; and our Chief Financial Officer, Bill Thalman, will be presenting our first-quarter operating results, market outlook, and business developments this morning.

謝謝您，接線生。大家早安，歡迎參加 L.B. Foster 2025 年第一季財報電話會議。我叫麗莎‧杜蘭特 (Lisa Durante)，是公司的財務報告總監。我們的總裁兼執行長 John Kasel 和財務長 Bill Thalman 將於今天上午介紹我們的第一季經營業績、市場展望和業務發展。

We'll start the call with John providing his perspective on the company's first quarter performance. Bill will then review the company's first-quarter financial results. John will provide perspective on market developments and company outlook in his closing comments. We will then open up the session for questions. Today's slide presentation, along with our earnings release and financial disclosures, were posted on our website this morning and can be accessed on our Investor Relations page at lbfoster.com. Our comments this morning will follow the slides in the earnings presentation.

我們將首先請約翰介紹他對公司第一季業績的看法。比爾隨後將回顧公司第一季的財務表現。約翰將在結論中提供有關市場發展和公司前景的看法。然後我們將開始提問環節。今天的幻燈片簡報以及我們的收益報告和財務揭露已於今早發佈在我們的網站上，您可以透過我們的投資者關係頁面 lbfoster.com 取得。我們今天上午的評論將在收益演示幻燈片之後進行。

Some statements we are making are forward-looking and represent our current view of our markets and business today. These forward-looking statements reflect our opinions only as of the date of this presentation, and we undertake no obligation to revise or publicly release the results of any revisions to these statements in light of new information, except as required by securities laws. For more detailed risks, uncertainties, and assumptions relating to our forward-looking statements, please see the disclosures in our earnings release and presentation. We'll also discuss non-GAAP financial metrics and encourage you to carefully read our disclosures and reconciliation tables provided within today's earnings release and presentation as you consider these metrics.

我們所做的一些聲明具有前瞻性，代表了我們對當前市場和業務的看法。這些前瞻性陳述僅反映我們截至本簡報發布之日的觀點，除非證券法要求，否則我們不承擔根據新資訊修改或公開發布這些陳述的任何修訂結果的義務。有關我們前瞻性陳述的更詳細風險、不確定性和假設，請參閱我們的收益報告和簡報中的揭露內容。我們還將討論非公認會計準則財務指標，並鼓勵您在考慮這些指標時仔細閱讀我們在今天的收益報告和報告中提供的揭露和對帳表。

So with that, let me turn the call over to John.

因此，請允許我將電話轉給約翰。

Thank you, Lisa, and hello, everyone. Thank you for joining us today. I'll begin my remarks on slide 5, covering the key drivers of our first quarter-results. As mentioned in our year-end earnings report in March, we started 2025 softer than last year, with first-quarter sales down 21.3% compared to atypically strong prior year comparison. The decline was realized entirely within our Rail segment, with infrastructure sales growing 5% over last year, driven primarily by strong demand in our Precast Concrete business.

謝謝你，麗莎，大家好。感謝您今天加入我們。我將從第 5 張投影片開始發言，介紹我們第一季業績的主要驅動因素。正如我們 3 月的年終收益報告中所提到的，2025 年開局比去年疲軟，第一季銷售額與異常強勁的去年同期相比下降了 21.3%。這一下降完全發生在我們的鐵路部門，基礎設施銷售額比去年增長了 5%，主要原因是預製混凝土業務的需求強勁。

It is important to note that our Rail business had an exceptionally strong first quarter last year and also entered 2025 with a lower backlog, primarily due to order timing and rail distribution. Rail distribution demand is lumpy at times, and we have experienced quarterly swings in volume in the past, depending on timing of the large project work. This quarter was also impacted by an apparent slowdown in the release of government funding impacting project activity levels with our customers. But I feel pleased to report that we're starting to see project funding and bidding levels improve as evidenced by our 46.9% rail backlog increase during the quarter.

值得注意的是，我們的鐵路業務去年第一季表現異常強勁，進入 2025 年時積壓訂單較少，這主要得益於訂單時間和鐵路分佈。鐵路配送需求有時會不穩定，過去我們經歷過季度波動，這取決於大型專案工作的時機。本季也受到政府資金發放明顯放緩的影響，影響了我們與客戶的專案活動水準。但我很高興地報告，我們開始看到專案資金和投標水準有所改善，這從本季鐵路積壓訂單增加 46.9% 可以看出。

Getting back to the results, the lower Q1 sales volume in the Rail segment drove a 69.3% decrease in adjusted EBITDA versus last year. As expected, our net debt increased to $79.9 million during the quarter, reflecting the increased working capital funding needed to support sales growth, along with annual incentive and insurance premium payments. Net debt was up $4.9 million versus last year, and the gross leverage ratio came in at 2.5 times compared to 2.2 times last year. Order rates began to recover in the first quarter, increasing 39.1% sequentially and 12.6% over last year. This translated into an improved backlog at quarter end of $237.2 million, up $51.3 million during the quarter and up $15 million over last year. The backlog growth was higher in our more profitable growth product lines, which should translate to near-term sales growth and profitability expansion year over year as early as the second quarter.

回顧業績，鐵路部門第一季銷售下降導致調整後 EBITDA 與去年相比下降了 69.3%。正如預期的那樣，本季我們的淨債務增加至 7,990 萬美元，反映了支持銷售成長所需的營運資金增加以及年度獎勵和保險費支付。淨債務較去年同期增加了 490 萬美元，總槓桿率為 2.5 倍，而去年同期為 2.2 倍。第一季訂單率開始回升，季增39.1%，年增12.6%。這意味著季度末積壓訂單量有所改善，達到 2.372 億美元，比本季增加了 5,130 萬美元，比去年同期增加了 1,500 萬美元。我們利潤更高的成長產品線的積壓訂單成長更高，這應該會轉化為近期銷售額的成長和獲利能力的同比增長，最早在第二季度實現。

After Bill covers the financial details for the quarter, I'll come back to them with some closing remarks on our backlog trends, the market outlook, and our financial guidance for the year. Over to you, Bill.

在比爾介紹完本季的財務細節之後，我將就我們的積壓趨勢、市場前景和今年的財務指導做一些總結性發言。交給你了，比爾。

Thanks, John. I'll begin my comments on slide 7, covering the consolidated results of the first quarter. As a reminder, the schedules in the appendix provide details on the financial results covered in today's call, including non-GAAP information. As John mentioned in his opening remarks, first-quarter results were lower than last year, driven entirely by lower sales volume in the Rail segment. Net sales for the quarter were down 21.3%, with Rail segment sales down 34.6%, driven primarily by weak rail distribution demand within the Rail Products business unit. Partially offsetting the decline was an increase in infrastructure sales, which were up 5% over last year due to a 33.7% increase in precast concrete sales.

謝謝，約翰。我將從第 7 張投影片開始發表評論，介紹第一季的綜合業績。提醒一下，附錄中的時間表提供了今天電話會議中涉及的財務結果的詳細信息，包括非 GAAP 資訊。正如約翰在開場白中提到的那樣，第一季的業績低於去年，完全是由於鐵路部門的銷售量下降。本季淨銷售額下降 21.3%，其中鐵路部門銷售額下降 34.6%，主要原因是鐵路產品業務部門的鐵路分銷需求疲軟。基礎設施銷售額的成長部分抵消了這一下降，由於預製混凝土銷售額增長了 33.7%，基礎設施銷售額比去年同期增長了 5%。

Gross profit was down $6 million, with the gross margin down 50 basis points to 20.6%. The decline was driven by lower rail sales, as well as slightly unfavorable mix within the Rail segment. SG&A costs decreased $1.9 million from the prior year due to lower personnel and professional service costs. First-quarter adjusted EBITDA was $1.8 million, down $4.1 million versus last year due to the lower margins from the rail sales decline.

毛利下降 600 萬美元，毛利率下降 50 個基點至 20.6%。下滑的原因在於鐵路銷量下降，以及鐵路部門內部結構略有不利。由於人員和專業服務成本降低，銷售、一般及行政費用較前一年減少 190 萬美元。第一季調整後的 EBITDA 為 180 萬美元，較去年同期下降 410 萬美元，因為鐵路銷售下滑導致利潤率降低。

Operating cash flow, which was a use of $26.1 million, followed normal seasonal patterns due to increased working capital needs, coupled with funding for prior year incentives and annual insurance premiums. We saw favorable trends in orders and backlogs across the business, which I'll cover by segment later in the presentation.

營運現金流為 2,610 萬美元，由於營運資金需求增加，加上上一年的獎勵和年度保險費的資金，遵循正常的季節性模式。我們看到整個業務的訂單和積壓訂單呈現良好趨勢，我將在後面的簡報中分部分介紹。

Slide 8 provides a reminder of the typical seasonality of our business. Sales and EBITDA levels are normally stronger in the second and third quarters as they represent the primary construction season period for our customers. The growth in our backlog during the first quarter gives us confidence that we will see an improvement in sales volumes across the business in the second quarter.

投影片 8 提醒我們我們的業務具有典型的季節性。通常，第二季和第三季的銷售額和 EBITDA 水平會更高，因為這兩個季度是我們客戶的主要施工季節。第一季積壓訂單的成長讓我們有信心，第二季整個業務的銷售量將會有所改善。

Free cash flow trends follow a pattern of consumption in the first half of the year, funding sales growth leading up to the construction season. This trend reverses in the back half of the year as construction season winds down. I'll highlight that despite these large swings, average free cash flow for 2023 and 2024 was approximately $31 million, excluding the $8 million Union Pacific payments, which are now behind us. That's a yield of approximately 15% at our current equity valuation. In summary, the softer first quarter is normal for our business, and we expect results for the balance of the year to follow our typical seasonal patterns.

自由現金流趨勢遵循上半年的消費模式，為建築旺季前的銷售成長提供資金。隨著建築季節的結束，這一趨勢在下半年出現逆轉。我要強調的是，儘管存在這些巨大的波動，但 2023 年和 2024 年的平均自由現金流約為 3,100 萬美元，不包括我們現在已經支付的 800 萬美元聯合太平洋鐵路付款。根據我們目前的股權估值，收益率約為 15%。總而言之，第一季的疲軟對我們的業務來說是正常的，我們預計今年剩餘時間的業績將遵循我們典型的季節性模式。

Over the next couple of slides, I'll cover our segment performance, starting with the Rail segment on slide 9. First-quarter Rail segment sales totaling $54 million were down 34.6% due to an exceptionally strong first quarter last year, coupled with the lower order book entering 2025. The sales decline was primarily in the Rail Products business unit, which was down 44.7% due to the decline in rail distribution volume. Technology Services and Solutions sales were also down 41.3% in part due to lower UK sales volumes as we continue to scale back initiatives in this market.

在接下來的幾張投影片中，我將介紹我們的細分市場表現，從第 9 張投影片上的鐵路細分市場開始。第一季鐵路部門銷售額總計 5,400 萬美元，下降 34.6%，原因是去年第一季表現異常強勁，加上進入 2025 年訂單量較低。銷售額下降主要發生在鐵路產品業務部門，由於鐵路配送量的下降，該部門銷售額下降了 44.7%。技術服務和解決方案的銷售額也下降了 41.3%，部分原因是我們繼續縮減在英國市場的舉措，導致英國的銷售量下降。

On a positive note, Global Friction Management sales were up 11% versus last year as this growth platform continues to perform well. Rail margins of 22.3% were down approximately 20 basis points, driven by the sales volume decline and unfavorable business mix. Rail orders declined 0.6% versus last year but increased 51.4% sequentially as we enter the stronger demand period for the business. Backlog levels increased 46.9% during the quarter and 6.6% versus last year. The backlog improvement was realized in both Rail Products and Global Friction Management, while Technology Services and Solutions backlog declined, driven primarily by the UK.

積極的一面是，由於這個成長平台持續表現良好，全球摩擦管理銷售額較去年增加了 11%。受銷售量下降和業務組合不利的影響，鐵路利潤率為 22.3%，下降約 20 個基點。鐵路訂單較去年同期下降 0.6%，但隨著我們進入業務需求更強勁的時期，環比增長 51.4%。本季積壓訂單量增加了 46.9%，比去年同期增加了 6.6%。鐵路產品和全球摩擦管理領域的積壓訂單均有所改善，而技術服務和解決方案領域的積壓訂單則有所下降，主要受英國的影響。

Turning to Infrastructure Solutions on slide 10. Net sales increased $2.1 million or 5% due to the strength in our Precast Concrete business, which increased 33.7% over the prior year. Steel products sales were down $5 million or 24.4% due primarily to lower Protective Coatings sales. Gross profit margins were up 40 basis points to 18.6% due to higher volumes within precast and improved margins in steel products due to our portfolio work. Infrastructure orders were very strong at $65.8 million, up $17.2 million or 35.3% over the prior year quarter. Backlog totaling $145.5 million is up $9.3 million over last year, including a $12.1 million increase or 51.6% from improving protective coating demand.

前往第 10 張投影片上的基礎設施解決方案。由於預製混凝土業務強勁成長，淨銷售額比上年增長了 33.7%，增加了 210 萬美元，即 5%。鋼鐵產品銷售額下降 500 萬美元，或 24.4%，主要原因是防護塗料銷售額下降。由於預製件產量增加以及投資組合工作帶來的鋼鐵產品利潤率提高，毛利率上升了 40 個基點，達到 18.6%。基礎設施訂單非常強勁，達到 6,580 萬美元，比去年同期增加 1,720 萬美元，增幅為 35.3%。積壓訂單總額為 1.455 億美元，比去年增加了 930 萬美元，其中因防護塗層需求增加而增加了 1,210 萬美元（51.6%）。

I'll now cover liquidity and leverage metrics on slide 11. Net debt levels increased $4.9 million over the last year to $79.9 million, and the gross leverage ratio increased 0.3 times to 2.5 times at quarter end. These movements were largely in line with our expectations. We're in the heavy working capital investment period of the year, which will continue in the second quarter as we fund expected sales growth.

我現在將在第 11 張投影片上介紹流動性和槓桿指標。淨債務水準比去年增加了 490 萬美元，達到 7,990 萬美元，總槓桿率在季度末增加了 0.3 倍，達到 2.5 倍。這些走勢基本上符合我們的預期。我們正處於今年營運資本投入較多的時期，這段期間將在第二季持續，因為我們將為預期的銷售成長提供資金。

Net debt levels should increase modestly during the second quarter, but we expect gross leverage will remain around 2.5 times before declining in the back half of the year. We remain confident in our ability to manage the choppy working capital needs of the business and believe the key drivers of strong sustainable free cash flow remain intact.

淨債務水準在第二季度應該會小幅上升，但我們預計總槓桿率將保持在 2.5 倍左右，然後在下半年下降。我們仍然對自己管理業務波動的營運資金需求的能力充滿信心，並相信強勁可持續自由現金流的關鍵驅動力仍然完好無損。

Our capital allocation priorities are outlined on slide 12. On March 3 of 2025, our Board authorized a new three-year $40 million stock buyback program that will expire at the end of February 2028. During the first quarter, we repurchased approximately 169,000 shares, representing approximately 1.5% of the shares that are outstanding. This compares to approximately 303,000 shares repurchased in all of 2024. Share repurchases are an important capital allocation priority for us, especially with the improving prospects for cash generation and the attractive equity valuation.

我們的資本配置優先事項在第 12 張投影片中概述。2025 年 3 月 3 日，我們的董事會批准了一項新的為期三年、金額為 4000 萬美元的股票回購計劃，該計劃將於 2028 年 2 月底到期。第一季度，我們回購了約 169,000 股，約佔流通股的 1.5%。相比之下，2024 年全年回購了約 303,000 股。股票回購是我們重要的資本配置重點，尤其是在現金產生前景不斷改善且股權估值具有吸引力的情況下。

We expect to invest capital in our facilities at a rate of approximately 2% of sales with a focus on organic growth initiatives in our growth platforms. We also continue to evaluate tuck-in acquisitions to add product line breadth and geographic coverage to our growth platforms. And finally, we will remain prudent with our leverage and net debt levels with the goal of maintaining leverage between 1 times and 2 times over the longer term.

我們預計將以約佔銷售額 2% 的比例向我們的設施投資，重點關注我們成長平台中的有機成長計畫。我們也將繼續評估補充收購，以擴大我們成長平台的產品線廣度和地理覆蓋範圍。最後，我們將對槓桿率和淨債務水準保持審慎，目標是長期將槓桿率維持在 1 倍至 2 倍之間。

My closing comments will refer to slides 13 and 14 covering orders, revenues, and backlog by business. The book-to-bill ratio for the trailing 12 months was a favorable 1.04:1 with favorable developments realized in both segments. First-quarter order rates improved 12.6% over the prior year, driven by a 35.3% increase in infrastructure orders. Order rates improved 39.1% sequentially with increases realized in both segments, highlighting the improved trend in demand levels across the business. And lastly, the consolidated backlog on slide 14 reflects an improving trend for both segments, with backlog growing during the quarter 46.9% and 17.8% for Rail and Infrastructure, respectively.

我的結論將參考第 13 和 14 張投影片，其中涵蓋了訂單、收入和業務積壓情況。過去 12 個月的訂單出貨比達到良好的 1.04:1，兩個部門都實現了良好的發展。第一季訂單率較上年同期提高 12.6%，主要得益於基礎設施訂單成長 35.3%。訂單率較上季提高 39.1%，兩個部門均實現成長，凸顯了整個業務需求水準的改善趨勢。最後，投影片 14 的合併積壓訂單反映了兩個部門的改善趨勢，本季鐵路和基礎設施的積壓訂單分別增加了 46.9％ 和 17.8％。

Rail backlog included a $22.8 million increase or 63.4% for rail products, driven primarily by improved demand within rail distribution. Compared to last year, consolidated backlog is up $15 million or 6.7% with gains realized in our more profitable product lines. Within Rail, Rail Products, and Friction Management backlog are up 21.2% and 71.4%, respectively, while the UK backlog within TS&S is down 52.7%. For Infrastructure, precast backlog is up 3.8%. And as I mentioned earlier, Protective Coating backlog is up $12 million or 51.6%.

鐵路積壓訂單中，鐵路產品訂單增加 2,280 萬美元，增幅達 63.4%，主要因鐵路配送需求增加。與去年相比，合併積壓訂單增加了 1,500 萬美元，即 6.7%，這得益於我們利潤更高的產品線實現了成長。在鐵路領域，鐵路產品和摩擦管理積壓訂單分別增加了 21.2% 和 71.4%，而英國 TS&S 領域的積壓訂單則下降了 52.7%。對於基礎設施而言，預製積壓訂單增加了 3.8%。正如我之前提到的，保護塗層積壓訂單增加了 1,200 萬美元，即 51.6%。

We believe these favorable trends will translate into improved results in the second quarter, both in terms of sales volume and margin expansion. Thanks for the time this morning. I'll now hand it back to John for his closing remarks. Back to you, John.

我們相信，這些有利趨勢將轉化為第二季業績的改善，無論是在銷售量或利潤率擴張方面。感謝您今天上午抽出時間。現在我將發言權交還給約翰，請他作最後發言。回到你身邊，約翰。

Thanks, Bill. Please turn to slide 16, where I'll begin my closing remarks, covering recent market developments and near-term outlook. While first-quarter results were down versus last year, the decline was largely isolated to weakness in rail distribution demand within the Rail Products business unit. This product line benefits from the well-publicized government infrastructure programs, which we believe slowed earlier in the year due to uncertainty in the amounts and continuation of Federal funding resulting from Washington's cost-cutting initiatives or the like. As Bill mentioned in his comments, it is important to note that demand levels for rail products began to improve throughout Q1 with orders up sequentially 77.8% and backlog up both sequentially and year over year at the end of the quarter.

謝謝，比爾。請翻到第 16 張投影片，我將從這裡開始我的結論，介紹最近的市場發展和近期前景。雖然第一季業績較去年同期下降，但下降主要是因為鐵路產品業務部門的鐵路配送需求疲軟。該產品線受益於廣為人知的政府基礎設施項目，我們認為，由於華盛頓的成本削減舉措或類似舉措導致聯邦政府資金數額和資金延續性的不確定性，該項目在今年早些時候有所放緩。正如比爾在評論中提到的那樣，值得注意的是，鐵路產品的需求水準在整個第一季開始改善，訂單環比增長 77.8%，季度末的積壓訂單環比和同比均有所增加。

We also are seeing increasing quotation rates from some of our largest customers in Q2, providing us confidence that the demand drivers for rail products are getting back on track. Demand for Friction Management solutions remains robust, and ongoing focus on rail safety in North America continues to drive demand for our total track monitoring solutions.

我們也看到第二季一些最大客戶的報價有所提高，這讓我們相信鐵路產品的需求驅動因素正在重回正軌。對摩擦管理解決方案的需求仍然強勁，北美對鐵路安全的持續關注繼續推動對我們整體軌道監控解決方案的需求。

Within the Infrastructure segment, demand for our precast concrete products continues to grow with increased orders and backlog year over year on top of strong sales growth delivered in the first quarter. We continue to see favorable demand building for our ENVIROCAST precast wall system now being manufactured in Florida, as well as our O&G protective coatings business with combined backlogs up $12.1 million or 51.6% year over year. The increased backlog, coupled with improved profitability mix within the backlog, should translate into near-term sales growth and profitability expansion year over year as early as the second quarter.

在基礎設施領域，我們的預製混凝土產品的需求持續成長，訂單和積壓訂單較去年同期成長，加上第一季的強勁銷售成長。我們繼續看到對我們目前在佛羅裡達州生產的 ENVIROCAST 預製牆體系統以及我們的石油和天然氣防護塗料業務的良好需求增長，合併積壓訂單同比增長 1210 萬美元或 51.6％。積壓訂單的增加，加上積壓訂單中獲利能力組合的改善，最早在第二季就會轉化為近期的銷售成長和獲利能力的年成長。

We are closely monitoring the status of the government funding programs but remain optimistic that they will move forward as announced given the greater infrastructure need. As mentioned during our last update, our markets are absorbing the threat of tariffs, which primarily is centered around steel. We continue to take steps in this area to protect our supply chains and building flexibility where possible, recognizing the volatile operating environment.

我們正在密切關注政府資助計劃的進展情況，但考慮到基礎設施需求的增加，我們仍然樂觀地認為這些計劃將按照宣布的那樣繼續推進。正如我們上次更新中提到的那樣，我們的市場正在承受關稅威脅，這主要集中在鋼鐵領域。認識到動盪的經營環境，我們將繼續採取措施保護我們的供應鏈，並盡可能建立靈活性。

In summary, we expect our key end markets will improve in the second quarter as we enter the heavier construction season for our customers. And as you would expect, we will monitor demand drivers as the balance of the year unfolds and focus on what we can control, maximizing the opportunity in front of us.

總而言之，隨著我們進入客戶建築業務繁忙的季節，我們預計我們的主要終端市場將在第二季度有所改善。正如您所期望的，我們將在今年餘下的時間裡監控需求驅動因素，並專注於我們能夠控制的事情，最大限度地利用我們面前的機會。

A reminder of our investment thesis can be found on slide 17. In summary, the four key pillars of value creation remain unchanged. We've repositioned our business portfolio, which allows us to focus on investment in our highly profitable growth platforms of Rail Technologies and Precast Concrete. Our capital-light business model drives free cash flow and economic profit generation with longer-term demand growth expected from domestic and infrastructure investment. We continue to employ a disciplined approach to capital allocation to maintain flexibility while driving shareholder returns. And lastly, we remain confident in our strategic execution and believe we're well positioned to deliver improved shareholder returns now and into the future.

我們的投資論文的提醒可以在第 17 張投影片上找到。綜上所述，價值創造的四大支柱保持不變。我們重新定位了我們的業務組合，這使我們能夠專注於投資高利潤的鐵路技術和預製混凝土成長平台。我們的輕資本商業模式推動自由現金流和經濟利潤創造，預計國內和基礎設施投資將帶來長期需求成長。我們繼續採用嚴謹的資本配置方法，以保持彈性，同時推動股東回報。最後，我們對我們的策略執行仍然充滿信心，並相信我們現在和將來都能夠為股東帶來更好的回報。

I'll wrap up today's call by covering our 2025 financial guidance on slide 19. First-quarter results were down from last year's exceptionally strong start, but the first quarter is normally slow, and we entered the second quarter with a strong backlog, improved profitability mix, and favorable demand drivers in our key end markets. The second-quarter results are expected to be substantially better than the first quarter, and we expect to realize near-term sales growth and profitability expansion year over year as early as the second quarter. As a result, despite the volatile and uncertain macro environment, we are maintaining our 2025 financial guidance as we continue to remain confident in our ability to deliver results within our guidance for the year.

我將在第 19 張投影片上介紹我們的 2025 年財務指導，以此結束今天的電話會議。第一季的業績較去年同期異常強勁的開局有所下降，但第一季度通常發展緩慢，而我們進入第二季度時擁有強勁的積壓訂單、改善的盈利組合以及主要終端市場的有利需求驅動力。預期第二季業績將大幅優於第一季度，我們預計最早在第二季就能實現近期銷售額成長和獲利能力較去年同期擴張。因此，儘管宏觀環境動盪且不確定，我們仍維持 2025 年財務指導，因為我們仍然對我們在今年的指導範圍內實現業績的能力充滿信心。

As I mentioned earlier, we remain optimistic that previously announced government funding programs for infrastructure investment will remain largely intact, and our 2025 guidance includes this assumption, knowing that we will revisit our guidance as appropriate as these market demand drivers and broader operating conditions become more clear for the balance of the year. Thank you for your time and continuing interest in L.B. Foster.

正如我之前提到的，我們仍然樂觀地認為，先前宣布的政府基礎設施投資資助計劃將基本保持不變，我們的 2025 年指導方針也包含這一假設，並且我們知道，隨著這些市場需求驅動因素和更廣泛的運營條件在今年餘下時間變得更加明朗，我們將適時重新審視我們的指導方針。感謝您對 L.B. Foster 的時間和持續關注。

I'll turn it back to the operator now for the Q&A session.

我現在會把話題交還給接線員，進行問答環節。

(Operator Instructions) Julio Romero, Sidoti.

（操作員說明）Julio Romero，Sidoti。

Great. Thanks. Thanks for taking the questions. So I wanted to start on the Rail Technology and Services segment. I appreciate the commentary you gave about the lower year-over-year volume and the impact that had on the first quarter and how the Rail Products business unit was down year over year against the strong prior year quarter in the first quarter. It would seem that the second and third quarter would also be tough comparable. So I was hoping you could talk about how you would have us think about Rail Products volumes sequentially here in the second quarter. And should we expect Rail Products volumes to also be down in the second quarter on a year-over-year basis?

偉大的。謝謝。感謝您回答這些問題。所以我想從鐵路技術和服務領域開始。我很欣賞您關於同比銷量下降及其對第一季的影響的評論，以及鐵路產品業務部門第一季與去年同期相比銷量下降的情況。看來第二季和第三季也很難比較。所以我希望您能談談我們如何看待第二季鐵路產品的銷售量。我們是否應該預期第二季鐵路產品銷售量將年減？

Thanks, Julio. Thanks for your question today. And we're a seasonal construction company. So we're looking for actually a very big Q2 and Q3. And this is where we really feel good about maintaining our guidance for the year because we've really picked up some nice orders entering Q2 in the mill and our supply channel partners are ready to perform.

謝謝，胡里奧。感謝您今天的提問。我們是一家季節性建築公司。因此，我們實際上期待著第二季和第三季的強勁表現。這正是我們對維持今年的指導感到真正高興的原因，因為我們在第二季度確實接到了一些不錯的訂單，我們的供應渠道合作夥伴也已準備好執行。

So we're contrary to maybe your thoughts, we're looking at big Q2. And last year wasn't the best Q2 for us. So we're looking to put a number on the board here and show some good activity here and profitability as well in Q2. And Rail Products will be a big piece of that.

因此，我們的想法可能與您相反，我們正在關注第二季。去年的第二季對我們來說並不是最好的。因此，我們希望在這裡公佈數字，並展示第二季度的一些良好活動和盈利能力。鐵路產品將在其中佔有重要地位。

Great. Very encouraging there. It was good to see that backlog growth in rail here in the quarter. Can you speak to the mix of that backlog growth?

偉大的。非常令人鼓舞。很高興看到本季鐵路積壓訂單有所增長。能談談積壓訂單成長的情況嗎？

Yeah. I've mentioned and Bill did as well, and I can have Bill give the exact numbers again. But even though we were down on the Rail Products side, to be clear, it was just the distribution side and a reminder investors and viewers that a big part of that Rail Distribution business flows through the government, about 82% of it. So that's where we saw a little bit of a pause in the first quarter. But we're seeing that break free now because the nice thing about the rail space is they need to replace the rail, right?

是的。我已經提到過，比爾也提到過，我可以讓比爾再次給出確切的數字。但儘管我們在鐵路產品方面表現不佳，但需要明確的是，這只是分銷方面的表現，並提醒投資者和觀眾，鐵路分銷業務的很大一部分是透過政府進行的，約佔 82%。因此，我們在第一季看到了一點停頓。但是我們現在看到這種情況正在擺脫，因為鐵路空間的好處是他們需要更換鐵路，對嗎？

They can't -- these things can't just sit there and not be replaced. So that work is beginning to come. But our TTM business, our condition monitoring business is really, really doing well, including the FM business. And that's where we're seeing even the larger profit margins as well and the opportunity to really get some nice growth, not just in the quarter but a year-over-year comparison. Bill, maybe you could highlight what those numbers were again?

它們不能——這些東西不能只是放在那裡而不被替換。所以這項工作已經開始了。但我們的 TTM 業務、我們的狀態監測業務（包括 FM 業務）確實做得很好。我們也看到了更大的利潤率以及真正獲得良好成長的機會，不僅是在本季度，而且與去年同期相比。比爾，也許你可以再強調一下這些數字是什麼？

Yeah. For the Rail segment, just looking at the year-over-year growth in backlog, we saw about 22% growth in rail products. Friction management was up about 71% on a year-over-year basis. So that again speaks to the improving mix within the backlog. And then importantly, we saw a pretty large decline in the UK portion of the backlog, which was down about 53% on a year-over-year basis.

是的。對於鐵路部門，僅從積壓訂單的同比增長來看，我們看到鐵路產品增長了約 22%。摩擦管理年增約71%。這再次說明積壓訂單的組合正在改善。重要的是，我們發現英國的積壓量大幅下降，與去年同期相比下降了約 53%。

And as you know, that market has been challenged for quite a while, and we've been scaling back our initiatives there. So all of those moves give us confidence that we're going to see improving profitability mix on the rail portfolio. And as long as we -- as we expect those government programs remain intact, that the volume should be there that would follow that mix improvement as well.

正如你所知，該市場已經面臨挑戰很長一段時間了，我們也一直在縮減在那裡的舉措。因此，所有這些舉措都讓我們有信心看到鐵路投資組合獲利能力的改善。只要我們 — — 正如我們預期的那樣，這些政府計劃保持不變，那麼其數量就應該存在，並且也會隨著組合的改善而存在。

Very helpful there. And then dovetails into the last question for me, which is just on the friction management piece, the growth in the backlog, and the upsales in the quarter here. Just speak to what's working well on that friction management piece and if you're seeing any share gains.

非常有幫助。然後與我的最後一個問題相吻合，這個問題是關於摩擦管理部分、積壓訂單的成長以及本季的追加銷售。只需談談摩擦管理方面哪些方面做得好，以及您是否看到了任何份額增長。

Yeah, we're picking up -- well, we're picking up new work and new customers and new geographies. And our service team has performed extremely well. So we feel very good about our installed base as it relates to lubricators and then the amount of consumables that's now entering North America as well as outside of North America is something we have never seen before. So we're feeling very good about that business. Our guy leading the business, Jason Bowlin, is doing just a fantastic job.

是的，我們正在獲得新的工作、新的客戶和新的地區。我們的服務團隊表現非常優秀。因此，我們對與潤滑器相關的安裝基礎感到非常滿意，現在進入北美以及北美以外的消耗品數量是我們以前從未見過的。所以我們對這項業務感到非常滿意。我們的業務主管 Jason Bowlin 做得非常出色。

He's also done a great job also in Canada. He's doing a great job of managing the relationships in the business. We talk about tariffs and this guy in that group is working very well, managing what's in front of us related to the ongoing tariff threats. And I'm very proud of what that group is doing, and our customers are getting the benefit of a very good product and service.

他在加拿大也做出了巨大的貢獻。他在管理業務關係方面做得很好。我們討論關稅，該小組的這個人工作非常出色，處理了我們面臨的與持續的關稅威脅有關的問題。我對團隊所做的事情感到非常自豪，我們的客戶也從非常優質的產品和服務中受益。

Very good. I'll pass it on, and best of luck in the second quarter.

非常好。我會傳遞這個訊息，並祝第二季好運。

Thanks, Julio.

謝謝，胡里奧。

Liam Burke.

利亞姆·伯克。

John, typically, if there's a potential economic or national economic slowdown, the rails tend to see lower traffic volumes, but that's when they take advantage of slower volumes and step up CapEx. Are you getting any kind of feel for increased capital expenditures on rail projects?

約翰，通常情況下，如果出現潛在的經濟或國家經濟放緩，鐵路運輸量往往會下降，但那時他們就會利用運輸量下降的機會，增加資本支出。您是否感覺到鐵路項目資本支出增加？

They don't come on and actually say that, but that's exactly what we're seeing. That's where this backlog and the orders that we're seeing is coming from. This is maintenance and additional capital work that they may be putting out have done. They're not necessarily adding capacity, but they're shoring up and harding their track system. So that's exactly right.

他們並沒有真正說出這些話，但這正是我們所看到的。這就是我們所看到的積壓訂單和訂單的來源。這是他們可能正在進行的維護和額外的資本工作。他們不一定會增加運力，但他們正在鞏固和加強他們的軌道系統。完全正確。

Great. Thank you. And on pipe coating, orders were up. The sales were -- were the sales numbers affected seasonally? Or is that just project-based and just general lumpiness?

偉大的。謝謝。管道塗層方面的訂單增加。銷售額－銷售數字是否受到季節性影響？或者這只是基於項目的並且只是一般的不平衡？

Yeah. I kind of shared with the -- I think earlier in the year, we talked about with the new administration that we're probably going to see this thing break free, and we have. And we're very pleased with the order intake. We've hired a lot of people, somewhere around 50 people for this business. We're running close to capacity right now.

是的。我有點分享過——我想在今年早些時候，我們與新政府討論過，我們可能會看到這件事得到解決，而且我們已經看到了。我們對訂單量非常滿意。我們為這項業務僱用了很多人，大約有 50 人。我們現在已經接近滿載運轉了。

We will be at full capacity in the second quarter. So we're seeing a very strong year. In fact, I think we're looking at multiple years of restoring that profitability of that business. Now remember, we have two businesses. We're in-line coater and we have special coating as well. Both businesses have very large opportunities in front of us, similar to what we've seen maybe six, seven years ago. So we're feeling very, very good about the outlook of those businesses. Bill, do you want to add anything to that?

我們將在第二季度滿載運轉。因此，我們預計今年將是強勁的一年。事實上，我認為我們需要花數年時間才能恢復該業務的獲利能力。現在請記住，我們有兩項業務。我們是在線塗佈機，我們也有特殊塗層。這兩家公司都面臨著巨大的機遇，與我們六、七年前看到的類似。因此，我們對這些企業的前景感到非常非常樂觀。比爾，你還有什麼要補充的嗎？

Yeah. The only thing I'd highlight is the quarter itself in terms of reported results, the coatings business was down a tick. We had a pretty large order that we had received at the end of the previous fiscal year that burned out in Q1 of last year. But so the first quarter was a little soft in terms of volume. But as John mentioned, we ended up having a 51% increase in the backlog based on the order intake level that we saw in Q1, and we see that continuing on for the rest of the year.

是的。我唯一要強調的是，就本季報告的結果而言，塗料業務略有下降。我們在上一財年末收到了一份相當大的訂單，該訂單在去年第一季就用完了。但就銷量而言，第一季有點疲軟。但正如約翰所提到的那樣，根據我們在第一季看到的訂單量，我們的積壓訂單量最終增加了 51%，我們預計這種情況將在今年剩餘時間內持續下去。

Thank you, John. Thank you, Bill.

謝謝你，約翰。謝謝你，比爾。

Thanks, Liam.

謝謝，利亞姆。

Christopher Sakai, Singular Research.

克里斯多福·薩凱（Christopher Sakai），Singular Research。

New orders and infrastructure, what are you seeing there? What's leading to the improvement?

新訂單和基礎設施，您在那裡看到了什麼？什麼導致了這種改善？

Yeah. So we mentioned that Q1 order rates of 35%. Precast is just doing extremely well. Our strategy was continue to double up and double down on what we're doing precast and with our expansion and growth in new product lines as well as our new acquisition well, that's not so new anymore. It's about -- it's approaching three years old. But the penetration we're seeing in the East Coast and down in the Carolinas and now with our new operations starting up in Florida, we're just really pleased with what's going on in our precast business. And we're looking for that really to -- it really shored up what we had in the first quarter, honestly, with the distribution being down. And we're looking for them to have sequentially a couple of really nice quarters put together here.

是的。所以我們提到第一季的訂單率為 35%。預製件的表現極為出色。我們的策略是繼續加倍投入預製業務，隨著我們新產品線的擴張和成長以及新收購的進行，這不再是新鮮事了。它已經快三歲了。但是，我們看到預製業務在東海岸和卡羅來納州的滲透率不斷提高，現在我們在佛羅裡達州的新業務也開始啟動，我們對預製業務的進展感到非常滿意。我們確實希望這一點——說實話，由於分銷量下降，它確實鞏固了我們第一季的業績。我們希望他們能夠連續在這裡取得幾個非常好的成績。

And the nice thing about the business is the Great American Outdoors Act, which is really the funding for our original legacy business, the building side, we haven't seen any pullback in that as well. So our order rate coming in related to the legacy of precast buildings is as good, if not better, than it was even last year. So we're looking at a fantastic year in that business in all of infrastructure, which is really being led by precast.

這項業務的優點在於《偉大的美國戶外法案》，它實際上是我們最初的遺留業務（建築方面）的資金來源，我們也沒有看到這方面有任何衰退。因此，我們與預製建築遺產相關的訂單率與去年一樣好，甚至更好。因此，我們預計今年將是基礎設施領域業務表現出色的一年，而這一領域的主要主導力量是預製件。

Okay. Great. Can you talk about potential acquisitions? What are you seeing out there? Is it more of a challenging market now with the talks of the tariff?

好的。偉大的。您能談談潛在的收購嗎？你在那裡看到了什麼？現在，由於關稅談判，市場是否面臨更大的挑戰？

It is. But we really are mindful of our strategy. We got a bunch of organic opportunities and growth that we're trying to manage. So we're busy hiring people. We're busy looking at adding shifts, and we're busy bringing in technical and salespeople to make things happen, including service operations and organization.

這是。但我們確實非常重視我們的策略。我們獲得了大量有機機會和成長，我們正在努力管理。所以我們正忙著招人。我們正忙於考慮增加班次，並忙於引進技術和銷售人員來實現目標，包括服務營運和組織。

So we're not really actively looking for acquisitions because we don't need them. What we have in front of us for the year and the guidance that's within our ability to perform. We just need to execute. Now if it makes sense to do some smaller tuck-in type things, we're, of course, always looking at those things, but it's really not front of center or front of mind for us right now, Chris.

因此，我們並沒有積極尋求收購，因為我們不需要收購。我們今年面臨的挑戰以及我們能夠實現的目標。我們只需要執行。現在，如果做一些較小的整合類的事情是有意義的，我們當然會一直關注這些事情，但克里斯，這真的不是我們現在最關心的事情。

Okay, great. Thanks for the answers.

好的，太好了。謝謝您的回答。

Yes. Thank you.

是的。謝謝。

(Operator Instructions) Justin Bergner, Gabelli Funds.

（操作員指示）Justin Bergner，Gabelli Funds。

A few questions here. You mentioned that weaker mix was a driver of slightly lower gross margins in your Rail segment. But I guess I didn't necessarily follow that, given the pieces you broke out and the strength in the friction side versus the rail products side.

這裡有幾個問題。您提到，產品組合較弱是導致鐵路部門毛利率略低的原因之一。但考慮到您所分解的碎片以及摩擦側與鐵路產品側的強度，我想我不一定遵循這一點。

Go ahead, Bill, please.

請繼續，比爾。

Yeah. So the volume impact on rail products was a part of it, just given the cost structure within the overall business. But then we also had our TTM business, which is the total track monitoring component of the business, had a pretty strong start to the year last year as well. So their volume decline was also a contributing factor. But if you look across the entire rail segment, the largest impact overall was by far the rail distribution volume.

是的。因此，考慮到整體業務的成本結構，對鐵路產品的數量影響是其中的一部分。但是我們的 TTM 業務（即業務的整體軌道監控部分）去年也有了相當強勁的開局。因此，其銷量下降也是一個因素。但如果縱觀整個鐵路領域，整體而言，影響最大的是鐵路配送量。

And the TTM piece, we're seeing nice bidding activity there. So that was more of a temporary factor than anything.

就 TTM 部分而言，我們看到了良好的競標活動。所以這只是一個暫時因素。

Okay. That makes sense. Are you seeing any benefit or impact from higher steel prices in your Rail Products business as it relates to dollar or percentage margin?

好的。這很有道理。您是否看到鋼材價格上漲對鐵路產品業務的美元或百分比利潤有任何好處或影響？

Yeah. Good question. So back in the first Trump administration, right, with the tariffs and 232 in steel, we benefited from that because as the steel input costs rose, we passed out of the marketplace today back then. And we're going to see the same thing, and we're seeing the same thing actually this year. As things continue to move forward and prices go, we'll be able to pass those on.

是的。好問題。所以回到川普第一屆政府時期，對，由於對鋼鐵徵收關稅和 232 條款，我們從中受益，因為隨著鋼鐵投入成本的上升，我們當時就退出了市場。我們將會看到同樣的事情，事實上今年我們就會看到同樣的事情。隨著事情繼續進展和價格上漲，我們將能夠將這些傳遞下去。

Coming out of COVID, we got really nimble and really agile where we're able to really start driving market pricing. So I think we're set up very well as the tariffs continue to -- how real they are, we'll be ready to make sure that we pass those out and get paid for.

擺脫 COVID 之後，我們變得非常靈活和敏捷，能夠真正開始推動市場定價。因此，我認為我們已經做好了充分的準備，無論關稅如何真實，我們都將做好準備，確保將其轉出並獲得報酬。

Okay. That makes sense as well. In terms of the funding being released, is that comment mainly relevant to the Rail Products business as you look at the rest of the year? Are there other businesses?

好的。這也很有道理。就所發放的資金而言，您對此的評論是否主要與今年剩餘時間的鐵路產品業務有關？還有其他業務嗎？

Yeah. Well, specifically rail distribution. So behind rail distribution is the transit business and behind the transit is government authorities. That's how it all flows. To put this in perspective for you, we wouldn't be talking about a down quarter if we just ship two or three more trains.

是的。嗯，具體來說是鐵路運輸。因此，鐵路運輸的背後是交通運輸業務，而交通運輸的背後是政府部門。一切就是這樣發生的。為了讓您更清楚地了解這一點，如果我們只多運送兩三列火車，我們就不會談論下滑的季度。

That's how close it is, and that's how lumpy it is, and that's what kind of construction work we do. So instead of those two or three trains being in Q1, this is again providing rail to the transit authorities. They'll now go on Q2. So we'll see that pick up. And it is all about the government programs.

它就是這麼接近，它就是這麼崎嶇，這就是我們所做的建設工作。因此，Q1 中不再有這兩三列火車，而是再次向交通部門提供鐵路。他們現在將進入第二季。因此我們將會看到這一回升。這一切都與政府計劃有關。

It's all about government funding, and it's about -- it's being a little slower just start of the year with all the things going on in Washington, but we're seeing that change here pretty quickly.

這一切都與政府資金有關，而且——由於華盛頓發生的所有事情，今年年初的資金流有些緩慢，但我們看到這種情況正在迅速改變。

Okay. Thank you. Lastly, could you comment at all on what you're seeing in April in terms of sales and orders versus the first quarter qualitatively or quantitatively?

好的。謝謝。最後，您能否從品質或數量上評估一下四月份的銷售和訂單情況與第一季相比的情況？

Yeah. I always love questions like that because we don't typically talk about that. But I'm not discouraged, let's put it that way, for where we're at sitting here in April. And when we talked and I closed up today's speech about giving confidence that we're going to hit our year-end guidance, that's mindful of what's going on in April.

是的。我總是喜歡這樣的問題，因為我們通常不談論這個問題。但我並不灰心，可以這麼說，因為我們四月正處於這樣的境地。當我們交談時，我在今天的演講結束時表示，我們有信心實現年底的預期目標，但也要考慮到四月的情況。

Okay. Do you still think the high -- upper half of the guidance is possible based on where we stand today?

好的。根據我們目前的狀況，您是否仍然認為達到預期的高位或上半部是可能的？

Yeah, Justin, we're lining up to our guidance. So we'll see where all the chips fall. I will tell you, our operations are ready to perform. So as the work continues and things get freed up here, we're ready to perform and ready to deliver.

是的，賈斯汀，我們正在遵循我們的指導。因此我們將拭目以待所有籌碼的落點。我告訴你，我們的行動已經準備好要執行了。因此，隨著工作的繼續和事情的進展，我們已經準備好執行並交付。

Okay. Thanks so much.

好的。非常感謝。

Thank you.

謝謝。

Thank you. And this does conclude today's Q&A session. I would like to turn the call back over to John Kasel, CEO, for closing remarks. Please go ahead, sir.

謝謝。今天的問答環節到此結束。我想將電話轉回給執行長約翰·卡塞爾 (John Kasel) 來做最後發言。先生，請繼續。

Thank you very much. Thank you for joining us today. It's one of these things that you get through the quarter and you get to the next quarter. And that's how myself and the management team are looking, put that behind us and really focus on what's in front of us right now because we have much to do to really be driving the volumes that we see in front of us and do it the right way to take care of our customers to make sure that we run a safe and good quality organization and drive shareholder return. And we're looking to continue that through Q2 and the balance of the year.

非常感謝。感謝您今天加入我們。這是你度過本季並進入下一季的事情之一。這就是我本人和管理團隊所期待的，把這些拋在腦後，真正專注於當前擺在我們面前的事情，因為我們還有很多工作要做，才能真正推動我們面前的業務量，並以正確的方式來照顧我們的客戶，確保我們經營一個安全和優質的組織，並推動股東回報。我們希望在第二季以及今年餘下時間繼續保持這種勢頭。

So thanks for your time today, and we look forward to talking to you after the close of the second quarter. Take care.

感謝您今天抽出時間，我們期待在第二季結束後與您交談。小心。

Thank you for your participation of today's conference call. You may now disconnect.

感謝您參加今天的電話會議。您現在可以斷開連線。