Limbach Holdings, Inc. Q4 FY2024 earnings call

• Strategy pillars: Shift revenue mix to ODR (67% of 2024 revenue, 75% of gross profit), evolve offerings for higher margins, and scale via acquisitions.
• Healthcare is largest vertical with 20 locations, actively expanding national footprint. Acquired Consolidated Mechanical in Dec 2024 to expand ODR relationships.
• Focus on working with existing building owners, assigning on-site account managers to build long-term relationships, and providing system solutions for aging infrastructure.
• M&A: Completed 5 acquisitions in past 3 years, targeting $8-$10M adjusted EBITDA per year, with efficient integration process.

In 2024, total revenue was $518.8 million, up slightly from $516.4 million in 2023. ODR revenue grew 31.9% and accounted for 66.6% of total revenue, while GCR revenue declined 31.9%. Total gross profit increased 20.9% to $144.3 million. ODR gross profit was $107.8 million, 74.7% of total gross profit, up 41.6%. GCR gross profit declined 15.5% but its margin increased to 21.1% from 17% in 2023. Fourth quarter 2024 total revenue was $143.7 million, up 0.7% from 2023. ODR revenue grew 21.4% in the quarter, and ODR backlog was $225.3 million vs. $147 million in 2023, while GCR backlog was $140 million vs. $186.9 million in 2023.

• 2025 revenue expected $610M-$630M, organic growth 10%-15%.
• Adjusted EBITDA expected $78M-$82M.
• SG&A target 18%-19% of revenue.
• Free cash flow conversion target at least 70%.
• CapEx run rate ~$4M in 2025, excluding $3.5M rental equipment investment in H1 2025.

• Seasonality in business affecting revenue timing.
• Dependence on successful integration of acquisitions.
• Labor concerns potentially impacting ability to support customers.

Q: About organic growth in ODR, A: Mike mentions it's part of overall top line, long-term goal with mix shift and acquisitions.

Q: About gross margin to OEM level, A: Long-term goal, combination of revenue mix shift and evolved offerings.

Q: About ODR penetration and account managers, A: Takes time, building relationships through critical repairs, specialized labor.

Q: About Q1 2025 revenue and growth later, A: Similar to Q1 2024, seasonality, mix shift, and acquisitions driving growth.

Q: About GCR margins and account managers, A: GCR margin boost from one-time write-ups, continuing to invest in account managers.

Q: About MSA growth and data center exposure, A: Majority growth from acquisitions, limited data center exposure in existing buildings.