Industrial Archives - Page 29 of 33

The GEO Group (GEO) – Meetings With Management

Posted on May 31, 2023May 31, 2023 by cpereira@noblefcm.com

Wednesday, May 31, 2023

The GEO Group, Inc. (NYSE: GEO) is a leading diversified government service provider, specializing in design, financing, development, and support services for secure facilities, processing centers, and community reentry centers in the United States, Australia, South Africa, and the United Kingdom. GEO’s diversified services include enhanced in-custody rehabilitation and post-release support through the award-winning GEO Continuum of Care®, secure transportation, electronic monitoring, community-based programs, and correctional health and mental health care. GEO’s worldwide operations include the ownership and/or delivery of support services for 103 facilities totaling approximately 83,000 beds, including idle facilities and projects under development, with a workforce of up to approximately 18,000 employees.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

NDRS. We hosted GEO CEO Jose Gordo, CFO Brian Evans, and EVP Pablo Paez for two days of well attended investor meetings in Florida last week. In addition to the normal overview of the business, management provided some commentary on the early days of post Title 42.

Perspective. While news headlines made much noise about daily border crossings being below the pre-May 11th 10,000 daily level, the roughly 5,000 daily level would be a record level sans the pre-May 11th 10,000 number. And the 5,000/day level still translates into over 1.8 million people annually.

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Great Lakes Dredge & Dock (GLDD) – A $157.4 Million Award for Freeport Harbor Channel

Posted on May 31, 2023May 31, 2023 by cpereira@noblefcm.com

Wednesday, May 31, 2023

Great Lakes Dredge & Dock Corporation is the largest provider of dredging services in the United States. In addition, Great Lakes is fully engaged in expanding its core business into the rapidly developing offshore wind energy industry. The Company has a long history of performing significant international projects. The Company employs experienced civil, ocean and mechanical engineering staff in its estimating, production and project management functions. In its over 131-year history, the Company has never failed to complete a marine project. Great Lakes owns and operates the largest and most diverse fleet in the U.S. dredging industry, comprised of approximately 200 specialized vessels. Great Lakes has a disciplined training program for engineers that ensures experienced-based performance as they advance through Company operations. The Company’s Incident-and Injury-Free® (IIF®) safety management program is integrated into all aspects of the Company’s culture. The Company’s commitment to the IIF® culture promotes a work environment where employee safety is paramount.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

New Award. Yesterday, Great Lakes was awarded a $157.4 million firm-fixed-price contract for new and maintenance hopper dredging of the Freeport Harbor Channel, according to the Department of Defense daily contract award release. This was one of the more significant capital markets projects expected to be awarded this year.

Confirmation. In the first quarter call, management had noted that the Company was the apparent low bidder for the award and yesterday’s announcement should be confirmation. This would be the third largest domestic capital project award in the Company’s history. While it typically takes up to 3 months for work to begin, this award will help improve fleet utilization in the back half of 2023 and into 2024, in our view.

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Orion Group Holdings (ORN) – Refinancing Completed; A Sale/Leaseback of Equipment

Posted on May 17, 2023May 17, 2023 by cpereira@noblefcm.com

Wednesday, May 17, 2023

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Refinancing. Yesterday, as widely expected, Orion closed on its debt refinancing. The new 3-year $103 million senior secured asset based credit facility with White Oak ABL, LLC and White Oak Commercial Finance, LLC consists of a $65 million asset based revolving credit facility and a $38 million fixed asset term loan. The new credit facility replaces the Company’s previous $42.5 million revolver.

Terms. The Revolver will initially bear interest at a rate of the 30-day SOFR plus 5.5% and the Term Loan at a rate of the 30-day SOFR plus 8.0%, subject to a SOFR floor of 4.0%. At a current 4.91% SOFR rate, this implies rates of approximately 10.4% and 12.9%. Orion was paying 10.2% on its previous credit line. At closing, the Company made an initial Revolver draw of $9.5 million.

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Euroseas (ESEA) – Euroseas largely booked out, but is still a play on rising rates because of newbuilds

Posted on May 17, 2023May 17, 2023 by cpereira@noblefcm.com

Wednesday, May 17, 2023

Euroseas Ltd. was formed on May 5, 2005 under the laws of the Republic of the Marshall Islands to consolidate the ship owning interests of the Pittas family of Athens, Greece, which has been in the shipping business over the past 140 years. Euroseas trades on the NASDAQ Capital Market under the ticker ESEA. Euroseas operates in the container shipping market. Euroseas’ operations are managed by Eurobulk Ltd., an ISO 9001:2008 and ISO 14001:2004 certified affiliated ship management company, which is responsible for the day-to-day commercial and technical management and operations of the vessels. Euroseas employs its vessels on spot and period charters and through pool arrangements.

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

First-quarter results largely as expected. Financial results continue to suffer the effects of a sharp decline in TCE rates over the last twelve months. While Euroseas has locked in 91% of remaining shipping days in 2023, those rates eventually roll off and get replaced with lower rates. The Aegean Express ended a contract at $41,000/day, which was replaced by a rate of $13,000/day. Four other ships with rates in the high $20,000’s/day will roll off in the second half of the year.

Shipping rates are improving and could go higher. Shipping rates appear to have bottomed out in February. Current rates for 1,700 TEU and 2,500 TEU ships have risen to $16,800/day and $18,750/day, respectively, returning to a point above the ten-year trailing average and Euroseas’ breakeven cash operating point. We believe rates will move even higher should global economic concerns abate and the war in Ukraine comes to an end.

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EuroDry (EDRY) – Shipping rates bottoming out and that’s good news for EuroDry

Posted on May 16, 2023May 16, 2023 by cpereira@noblefcm.com

Tuesday, May 16, 2023

EuroDry Ltd. was formed on January 8, 2018 under the laws of the Republic of the Marshall Islands to consolidate the drybulk fleet of Euroseas Ltd. into a separate listed public company. EuroDry was spun-off from Euroseas Ltd. on May 30, 2018; it trades on the NASDAQ Capital Market under the ticker EDRY. EuroDry operates in the dry cargo, drybulk shipping market. EuroDry’s operations are managed by Eurobulk Ltd., an ISO 9001:2008 and ISO 14001:2004 certified affiliated ship management company and Eurobulk (Far East) Ltd. Inc., which are responsible for the day- to-day commercial and technical management and operations of the vessels. EuroDry employs its vessels on spot and period charters and under pool agreements.

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

EuroDry reported weak 2023-1Q results due to lower shipping rates, largely as expected. The EuroDry fleet ran near full capacity but did so at much lower rates. The average TCE rate for the quarter was $10,674 down 57% versus last year and below our expectations. EuroDry typically only books out less than half of the days beyond the upcoming quarter making it more sensitive to spot shipping rates than most shipping companies.

Operating costs were generally in line except for voyage expenses. Operating costs for the quarter rose relative to the same period last year and the previous quarter. The increase can largely be attributed to a rise in voyage expenses. Management indicated the increase was due to “expenses incurred by one of our vessels while employed under a voyage charter.” This is in contrast to the previous year when the company recognized “a gain on bunkers” of $1.0 million. The company has traditionally booked a gain in the voyage expense line.

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Kelly Services (KELYA) – First Quarter 2023 Results

Posted on May 15, 2023May 15, 2023 by cpereira@noblefcm.com

Monday, May 15, 2023

Kelly (Nasdaq: KELYA, KELYB) connects talented people to companies in need of their skills in areas including Science, Engineering, Education, Office, Contact Center, Light Industrial, and more. We’re always thinking about what’s next in the evolving world of work, and we help people ditch the script on old ways of thinking and embrace the value of all workstyles in the workplace. We directly employ nearly 350,000 people around the world and connect thousands more with work through our global network of talent suppliers and partners in our outsourcing and consulting practice. Revenue in 2021 was $4.9 billion. Visit kellyservices.com and let us help with what’s next for you.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

1Q23. Revenue of $1.27 billion was down 2.2% year-over-year (down 1.4% in constant currency). We were at $1.23 billion. Kelly took a $5.7 million restructuring charge during the quarter. GAAP net income was $10.9 million, or EPS of $0.29/sh, compared to a GAAP loss of $47.6 million, or a loss of $1.23/sh, last year. Adjusted EPS for 1Q23 was $0.40 versus $0.44 last year. We had projected adjusted EPS of $0.27.

Accelerating Profitable Growth. Management announced a comprehensive and intensive transformation initiative to optimize the business and functional operations in a sustainable manner, unlock additional value-creating opportunities, and accelerate profitable growth.

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Orion Group Holdings (ORN) – Post Call Commentary and Updated Models

Posted on May 10, 2023May 10, 2023 by cpereira@noblefcm.com

Wednesday, May 10, 2023

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Disappointing 1Q23. Management was disappointed with 1Q23 results, but a number of negative impacts were out of their hands, such as weather and customer delays, impacting production rates and profitability. However, these projects are not lost, just pushed to the right.

But Improvements Being Made. The most significant is a return to profitability for the Concrete segment in March, its first profitable month in two years. As the unfavorable Central Texas business continues to fall off, we expect further profitability improvement for the Concrete business.

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Release – CVG Announces CEO Transition and Reaffirms 2023 Outlook And Long-Term Strategy

Posted on May 9, 2023May 9, 2023 by aweinsoff@channelchek.com

Research News and Market Data on CVGI

MAY, 09, 2023

NEW ALBANY, Ohio, May 09, 2023 (GLOBE NEWSWIRE) — CVG (NASDAQ: CVGI), a diversified industrial products and services company, announced yesterday that Harold Bevis is resigning from his role as President and Chief Executive Officer of the Company and as a member of the Company’s Board of Directors (the “Board”) effective May 19, 2023 to become chief executive officer of another company. Mr. Bevis’ resignation did not result from any disagreement with the Company on any matter, including any matter relating to its operations, policies or practices.

Robert C. Griffin, the Chairman of the Board, is expected to be elected by the Board as the Company’s interim President and Chief Executive Officer, effective May 19, 2023. Mr. Griffin along with the Board of Directors has served as a Director since 2005 and has worked closely alongside Harold in designing and implementing the Company’s strategy.

“Harold has set CVG on the right path for future growth and we’re grateful for his contributions,” Mr. Griffin said. “The board and I are eager now to find the right leader who will continue our momentum as a business and drive us into the future.”

Mr. Griffin will serve as interim President and Chief Executive Officer until his successor is chosen. The Company is in the process of conducting a comprehensive search for a permanent President and Chief Executive Officer and will name Mr. Griffin’s successor at the completion of the search.

In announcing the management changes noted above, the Company today reaffirmed its commitment to its strategic goals and improvement in its results for 2023.

As disclosed in its first quarter results and discussed on its first quarter conference call on May 4, 2023, the Company:

will continue its focus on price and cost which allowed it to deliver significant margin expansion in the first quarter;
believes its first quarter margin performance is sustainable for fiscal 2023 given the current vehicle production outlook;
believes based on the current revenue run rate, combined with new wins that are still ramping up, it is on track to deliver its 2027 revenue target of $1.5 billion; and
will continue to focus on price and inflation management, and cost reduction as it works toward achieving a 9% EBITDA margin target by 2027.

Mr. Griffin stated, “The Board is pleased with the Company’s first quarter performance and reaffirms our commitment to the Company’s strategic direction as discussed on its first quarter call on May 4, 2023. We believe we have a solid balance sheet, a business winning culture, and strong leadership team that positions us well to execute on our strategy. The Board looks forward to working with the management team to continue our positive momentum throughout this transition.”

Robert C. Griffin Biography

Mr. Griffin, 75, has served as a member of the Board since July 2005, and was elected Chairman in 2019. Mr. Griffin’s career spanned over 25 years in the financial sector until he retired from Barclays Capital, where from June 2000 to March 2002 he was Head of Investment Banking, Americas and a member of the Management Committee. Prior to joining Barclays Capital, Mr. Griffin was a member of the Executive Committee for the Montgomery Division of Banc of America Securities and held a number of positions with Bank of America, including Group Executive Vice President and Head of Global Debt Capital Raising and as a Senior Management Council Member. Since 2005, he has served on a number of boards, both public and private, including during the last five years, the boards of the following public companies: The J.G. Wentworth Company (ending in 2018), and Builders FirstSource, Inc. (ending in 2019).

Company Contact

Andy Cheung
Chief Financial Officer
CVG
IR@cvgrp.com

Investor Relations Contact

Ross Collins or Stephen Poe
Alpha IR Group
CVGI@alpha-ir.com

About CVG

At CVG, we deliver real solutions to complex design, engineering and manufacturing problems across a range of global industries by innovating, constantly adding value, and treating our customer’s bottom line as if it were our own. Information about the Company and its products is available on the internet at www.cvgrp.com.

Forward-Looking Statements

This press release contains forward-looking statements that are subject to risks and uncertainties. These statements often include words such as “believe”, “anticipate”, “plan”, “expect”, “intend”, “will”, “should”, “could”, “would”, “project”, “continue”, “likely”, and similar expressions. In particular, this press release may contain forward-looking statements about the Company’s expectations for future periods with respect to its plans to improve financial results, the future of the Company’s end markets, including the short-term and long-term impact of the COVID-19 pandemic on our business, changes in the Class 8 and Class 5-7 North America truck build rates, performance of the global construction equipment business, the Company’s prospects in the wire harness, warehouse automation and electric vehicle markets, the Company’s initiatives to address customer needs, organic growth, the Company’s strategic plans and plans to focus on certain segments, competition faced by the Company, volatility in and disruption to the global economic environment and the Company’s financial position or other financial information. These statements are based on certain assumptions that the Company has made in light of its experience as well as its perspective on historical trends, current conditions, expected future developments and other factors it believes are appropriate under the circumstances. Actual results may differ materially from the anticipated results because of certain risks and uncertainties, including those included in the Company’s filings with the SEC. There can be no assurance that statements made in this press release relating to future events will be achieved. The Company undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time. All subsequent written and oral forward-looking statements attributable to the Company or persons acting on behalf of the Company are expressly qualified in their entirety by such cautionary statements.

Source: Commercial Vehicle Group, Inc.

Orion Group Holdings (ORN) – A Quick Look into the First Quarter

Posted on May 9, 2023May 9, 2023 by cpereira@noblefcm.com

Tuesday, May 09, 2023

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Results are In. Orion had contract revenues of $159.2 million, a 9% decrease from the prior year’s $174.9 million. We had revenue of $175 million. Gross profit was at $5.8 million or 3.7% of revenue, down from $12.8 million or 7.3% of revenue in the first quarter of 2022. The Company had a net loss of $12.6 million, or $0.07 per share, compared to a loss of $4.9 million, or $0.16 per share. Adjusted EBITDA was a negative $4.1 million, or (2.6)% margin compared to $5.2 million or 3.0% last year.

Credit Facility and Property Sale. The Company had reached an agreement with a private lender and expects to have a new ABL credit facility completed shortly. The facility consists of a $38 million term loan and revolving credit facility of $65 million and will be used to retire Orion’s existing credit facility and for general corporate purposes. As reported previously, Orion has a contract for the East West Jones properties in Texas, with the purchase price being $36 million. It is expected to close in the third quarter of 2023.

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Eagle Bulk Shipping (EGLE) – First-Quarter Results In Line With Recently Revised Estimates

Posted on May 8, 2023May 8, 2023 by cpereira@noblefcm.com

Monday, May 08, 2023

Eagle Bulk Shipping Inc. (“Eagle”) is a US-based drybulk owner-operator focused on the Supramax/Ultramax mid-size asset class, which ranges from 50,000 and 65,000 deadweight tons in size; these vessels are equipped with onboard cranes allowing for the self-loading and unloading of cargoes, a feature which distinguishes them from the larger classes of drybulk vessels and provides for greatly enhanced flexibility and versatility- both with respect to cargo diversity and port accessibility. The Company transports a broad range of major and minor bulk cargoes around the world, including coal, grain, ore, pet coke, cement, and fertilizer. Eagle operates out of three offices, Stamford (headquarters), Singapore, and Hamburg, and performs all aspects of vessel management in-house including: commercial, operational, technical, and strategic.

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Sensitivity to shipping rates leads to declines, as expected. Eagle Bulk Shipping reported a 43% decrease in net revenues versus last year despite additional operating days. The decline was due to a 53% decline in average TCE rates. Eagle’s financial results are highly leveraged to changes in shipping rates with a coverage position of only 65% of available days for the upcoming second quarter.

The trend of rising operating costs seems to be abating. Cash operating costs have been rising in recent quarters but the growth appears to be slowing. Most notably was the decline in charter expenses (which we typically do do not model in). The decline was due to a reduction in chartered-in days (944 versus 960 last year) and an overall decline in charter hire rates related to the decline in drybulk market.

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Kratos Defense & Security (KTOS) – Solid 1Q23 Results; Growth Opportunities Expanding

Posted on May 8, 2023May 8, 2023 by cpereira@noblefcm.com

Monday, May 08, 2023

Kratos Defense & Security Solutions, Inc. (NASDAQ:KTOS) develops and fields transformative, affordable technology, platforms, and systems for United States National Security related customers, allies, and commercial enterprises. Kratos is changing the way breakthrough technologies for these industries are rapidly brought to market through proven commercial and venture capital backed approaches, including proactive research, and streamlined development processes. At Kratos, affordability is a technology, and we specialize in unmanned systems, satellite communications, cyber security/warfare, microwave electronics, missile defense, hypersonic systems, training and combat systems and next generation turbo jet and turbo fan engine development. For more information go to www.kratosdefense.com.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

1Q23 Results. Results came in at the high end of guidance. Revenue totaled $231.8 million, up 18.1% y-o-y. Organic growth was 12%. Adjusted EBITDA came in at $17 million, up from $13.8 million in 1Q22. GAAP EPS loss was $0.05 and adjusted EPS net income was $0.06, compared to a net loss of $0.13 and adjusted EPS of $0.04, respectively, a year ago. We had forecasted $220 million, $15.5 million, $(0.03), and $0.07, respectively.

Expanding Opportunity Set. Kratos’ opportunity set continues to expand. As part of the 5-year defense spend plan, the USAF has requested approximately $6 billion reflecting an increased prioritization with it being reported that the Air Force is looking to ultimately procure up to 2,000 drone systems. The Navy has been reported as stating they envision up to 60% of the future Navy Air Wing being comprised of drones.

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CoreCivic, Inc. (CXW) – 1Q23 Post Call Commentary

Posted on May 8, 2023May 8, 2023 by cpereira@noblefcm.com

Monday, May 08, 2023

CoreCivic is a diversified, government-solutions company with the scale and experience needed to solve tough government challenges in flexible, cost-effective ways. We provide a broad range of solutions to government partners that serve the public good through high-quality corrections and detention management, a network of residential and non-residential alternatives to incarceration to help address America’s recidivism crisis, and government real estate solutions. We are the nation’s largest owner of partnership correctional, detention and residential reentry facilities, and believe we are the largest private owner of real estate used by government agencies in the United States. We have been a flexible and dependable partner for government for nearly 40 years. Our employees are driven by a deep sense of service, high standards of professionalism and a responsibility to help government better the public good. Learn more at www.corecivic.com.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

May 11th. With Title 42 expected to end May 11th, CoreCivic is well positioned to capitalize on any increase in ICE detainee populations. The key unanswered question is if the Biden Administration will enforce existing immigration laws. Recent comments by Secretary of State Blinken and Secretary of Homeland Security Mayorkas suggests the federal government will, but it remains to be seen.

Well Positioned. CoreCivic is well positioned to assist the government with any additional demand for beds and services. The Company has “thousands” of beds at existing facilities that could be used and seven idle facilities that could be restarted. The Company has hired staff in anticipation of rising populations.

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DLH Holdings (DLHC) – Post Call Update

Posted on May 5, 2023May 5, 2023 by cpereira@noblefcm.com

Friday, May 05, 2023

DLH delivers improved health and readiness solutions for federal programs through research, development, and innovative care processes. The Company’s experts in public health, performance evaluation, and health operations solve the complex problems faced by civilian and military customers alike, leveraging digital transformation, artificial intelligence, advanced analytics, cloud-based applications, telehealth systems, and more. With over 2,300 employees dedicated to the idea that “Your Mission is Our Passion,” DLH brings a unique combination of government sector experience, proven methodology, and unwavering commitment to public health to improve the lives of millions. For more information, visit www.DLHcorp.com.

Joe Gomes, Managing Director, Equity Research Analyst, Generalist , Noble Capital Markets, Inc.

Joshua Zoepfel, Research Associate, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Timing. As we suspected, the top line miss was more a reflection of contract timing, as some awards have been pushed out to the right. We are not concerned as we expect the business eventually will come in. We would point out continued growth in the VA mail order business, with the $20.2 million of revenue in the quarter up 18.1% y-o-y.

Mix. The lower than projected EPS was driven by two items: lower margin than we had expected, mostly due the mix of business in the quarter, and higher interest expense, mostly due to the higher interest rate environment impact on DLH’s variable rate debt.

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