First quarter net sales of $124.3 million up 7.6% year over year (up 16.9% organically1); gross profit of $26.2 million up 12.7% year over year with gross margins expanding 90 basis points ("bps") to 21.1%. First quarter net income of $4.4 million favorable $6.6 million year over year; first quarter adjusted EBITDA1 of $5.9 million up 32.4% year over year. Net debt1 of $74.9 million down $2.5 million and Gross Leverage Ratio1 of 2.2x down 0.2x versus last year's comparable quarter end. Net debt at quarter end included the impact of $3.5 million in net proceeds received for a non-core property sale completed during the quarter. First quarter new orders1 were $132.4 million, down $7.1 million from last year, but up sequentially $26.9 million, or 25.5%. Organic orders1 were up 3.0% over last year excluding an $11.3 million impact from divestitures and product line exits. The trailing twelve month book-to-bill ratio1 was 0.94 : 1.00. Backlog1 at quarter end was $222.3 million, down $37.6 million from last year (including $12.1 million from divestitures and product line exits), but up sequentially $8.5 million, or 4.0%. Full year 2024 financial guidance reaffirmed; net sales expected to range from $525.0 million to $560.0 million, adjusted EBITDA expected to range from $34.0 million to $39.0 million, free cash flow expected to range from $12.0 million and $18.0 million, and capital spending as a percent of sales expected to range from 2.0% to 2.5%. PITTSBURGH, May 07, 2024 (GLOBE NEWSWIRE) -- L.B. Foster Company (NASDAQ:FSTR), a global technology solutions provider of products and services for the rail and infrastructure markets (the "Company"), today reported its 2024 first quarter operating results. CEO Comments John Kasel, President and Chief Executive Officer, commented, "We had an exceptionally-strong start to 2024 with organic growth and profitability expansion as the key highlights of the first quarter. After a sluggish finish to 2023, our Rail business rebounded in the first quarter delivering 29.4% organic sales growth and 22.5% gross margins which were up 30 bps over last year and up 330 bps sequentially. Results in the Infrastructure business were somewhat softer with sales essentially flat year over year on an organic basis as adverse weather conditions impacted volumes in our Precast Concrete business. However, we grew our Precast backlog 17.0% during the quarter which should lead to increased volumes in the coming quarters as we expect more favorable conditions during the traditional construction season in the second and third quarter. Improved sales and profitability across our Steel Products businesses helped to offset the weaker Precast results within Infrastructure in the quarter. All in all, I'm pleased with our first quarter results and continuing progress along our transformation journey." Mr. Kasel continued, "Our reported results in the quarter included a $3.5 million gain associated with the sale of an ancillary industrial property in Magnolia, Texas. We've excluded this gain from the adjusted EBITDA of $5.9 million, which was up $1.5 million, or 32.4%, over last year. Cash proceeds received from the sale were used to pay down our revolving credit facility balance, resulting in net debt of $74.9 million at quarter end. As expected, net debt increased $22.2 million during the quarter primarily due to increased working capital to support sales growth. On a year-over-year basis, net debt declined $2.5 million, with the resulting 2.2x Gross Leverage Ratio down 0.2x from last year. We remain focused on our capital allocation priorities, which include maintaining a reasonable leverage level around 2.0x as well as investing in organic growth and tuck-in acquisition opportunities. We also remain active with our stock buyback program, with 1.4% of outstanding shares repurchased in a little less than a year and $12.3 million of the original $15 million authorization remaining through February 2026. While cash flow from operations was a $21.9 million use in the quarter, we expect our operating cash flow will improve along typical seasonal patterns as the year progresses. Finally, 2024 is the last year of our Union Pacific settlement funding which will allow for additional free cash flow in 2025 and beyond." Mr. Kasel concluded, "As expected, order rates began to show signs of recovery in the quarter, increasing 3.0% over last year after adjusting for divestitures and product line exits completed last year. First quarter orders were up sequentially 25.5% and were particularly strong in the Rail business with a 39.4% increase over last year's fourth quarter. Infrastructure orders were down 26.1% year over year primarily due to divestitures and product line exit activities, but were up 7.0% sequentially. The TTM book-to-bill ratio was 0.94 : 1.00 due to the strong sales performance relative to order rates indicating an improvement in lead times and order fulfillment across the business. Backlog at quarter end was a healthy $222.3 million, up $8.5 million during the quarter, and demand levels across the majority of our end markets remain robust. As a result, we are reaffirming our 2024 financial guidance, remain focused on executing our strategic transformation and look forward to reporting our progress throughout the year." 1 See "Non-GAAP Financial Measures" and "Non-GAAP Disclosures" at the end of this press release for a description of and information regarding organic sales and new orders, adjusted EBITDA, Gross Leverage Ratio per the Company's credit agreement, net debt, new orders, backlog, book-to-bill ratio, and related reconciliations to their most comparable GAAP financial measure. Financial Guidance 2024 Full Year Financial Guidance   Low   High Net sales   $ 525,000     $ 560,000   Adjusted EBITDA   $ 34,000     $ 39,000   Free cash flow   $ 12,000     $ 18,000   Capital spending as a percent of sales     2.0 %     2.5 %                   First Quarter Consolidated Highlights The Company's first quarter performance highlights are reflected below:     Three Months EndedMarch 31,   Change   PercentChange      2024    2023   2024 vs. 2023   2024 vs. 2023                       (Unaudited)         Net sales   $ 124,320     $ 115,488     $ 8,832     7.6 % Gross profit     26,249       23,291       2,958     12.7   Gross profit margin     21.1 %     20.2 %   90 bps     4.5   Selling and administrative expenses    $ 22,749     $ 21,423      $ 1,326     6.2   Selling and administrative expenses as a percent of sales     18.3 %     18.5 %   (20) bps     (1.1 ) Operating profit    $ 2,283      $ 503     $ 1,780     353.9   Net income (loss) attributable to L.B. Foster Company     4,436       (2,152 )     6,588     ** Adjusted EBITDA     5,933       4,482       1,451     32.4   Adjusted EBITDA margin1     4.8 %     3.9 %   90 bps     23.2   New orders   $ 132,385      $ 139,515     $ (7,130 )   (5.1 )                                 Backlog    $ 222,261      $ 259,881     $ (37,620 )   (14.5 )                                 **Results of this calculation not considered meaningful. Net sales for the 2024 first quarter were $124.3 million, up $8.8 million, or 7.6%, over the first quarter of 2023. Net sales increased 16.9% organically and decreased 9.2% due to divestiture and product line exit activity. Organic sales growth was driven by the Rail, Technologies, and Services segment. Gross profit for the 2024 first quarter was $26.2 million, a $3.0 million increase year over year, or 12.7%, and gross profit margins increased by 90 basis points to 21.1%. The improvement in gross profit was due to the business portfolio changes in line with the Company's strategic transformation along with overall higher sales volumes and favorable mix. Selling and administrative expenses for the 2024 first quarter were $22.7 million, a $1.3 million increase, or 6.2%, over the prior year quarter. The increase was primarily attributed to personnel costs and professional services expenditures. Selling and administrative expenses as a percentage of net sales decreased to 18.3% in the current quarter, down from 18.5% last year. Operating profit for the 2024 first quarter was $2.3 million, favorable by $1.8 million over the prior year quarter. The improvement in operating profit was due to increased gross profit, partially offset by higher selling and administrative expenses. Net income attributable to the Company for the 2024 first quarter was $4.4 million, or $0.40 per diluted share, favorable by $6.6 million from the prior year quarter. The change in net income attributable to the Company was due to favorable operating profit as well as other income - net of $3.5 million in 2024 versus other expense - net of $1.8 million in 2023. Other income - net for the three months ended March 31, 2024 includes a net gain of $3.5 million on the sale of the Company's former joint venture facility and land in Magnolia, Texas. Other expense - net for the three months ended March 31, 2023 includes the $2.0 million loss on the sale of Chemtec. Adjusted EBITDA for the 2024 first quarter, which adjusts for the net gain on the sale of the Magnolia, Texas property, was $5.9 million, a $1.5 million increase, or 32.4%, over the prior year quarter. Adjusted EBITDA for 2023 first quarter adjusts for the loss on the sale of Chemtec. New orders totaling $132.4 million for the 2024 first quarter decreased $7.1 million, or 5.1%, from the prior year quarter, $11.3 million of which was due to divestiture and exit activity. Backlog totaling $222.3 million decreased by $37.6 million, or 14.5%, compared to the prior year quarter, $12.1 million of which was due to divestiture and product line exit activity. Cash used by operating activities totaled $21.9 million in the first quarter, an increase of $28.8 million over cash provided by operating activities of $6.9 million in the prior year quarter. Net debt of $74.9 million as of March 31, 2024 reflects a decrease of $2.5 million from the prior year quarter and an increase of $22.2 million from the prior quarter. The Gross Leverage Ratio of 2.2x as of March 31, 2024 reflects a decline of 0.2x compared to the prior year quarter and an increase of 0.5x from prior quarter. Net debt and leverage levels are elevated due to organic growth initiatives and higher seasonal working capital needs. First Quarter Business Results by Segment Rail, Technologies, and Services Segment     Three Months EndedMarch 31,   Change   PercentChange      2024    2023   2024 vs. 2023   2024 vs. 2023 Net sales   $ 82,623     $ 64,384     $ 18,239     28.3 % Gross profit   $ 18,571     $ 14,284     $ 4,287     30.0   Gross profit margin     22.5 %     22.2 %   30 bps     1.3   Segment operating profit   $ 6,778     $ 2,388     $ 4,390     183.8   Segment operating profit margin     8.2 %     3.7 %   450 bps     121.2   New orders   $ 83,741     $ 73,722     $ 10,019     13.6   Backlog   $ 86,038     $ 113,593     $ (27,555 )   (24.3 )                                 Net sales for the 2024 first quarter were $82.6 million, a $18.2 million increase, or 28.3%, over the prior year quarter, 29.4% of which was due to organic sales growth, slightly offset by a 1.1% decline from divestitures. Organic sales growth was driven by improvement in both Rail Products and Technology Services and Solutions, offset by lower volumes in the Global Friction Management business. Gross profit for the 2024 first quarter was $18.6 million, a $4.3 million increase, and gross profit margins expanded by 30 basis points to 22.5%. Gross profit improvement was driven primarily by higher sales and improved business mix. Segment operating profit for the 2024 first quarter was $6.8 million, a $4.4 million increase over the prior year quarter, due to the improvement in gross profit. Orders increased by $10.0 million, driven primarily by Rail Products as well as Global Friction Management, which offset declines in Technology Services and Solutions. Backlog of $86.0 million decreased $27.6 million from the prior year quarter driven almost entirely by Rail Products, due to timing fluctuations in the execution of large orders. Changes in orders and backlog associated with last year's Concrete Ties divestiture were declines of $2.7 million and $3.5 million, respectively. Infrastructure Solutions Segment     Three Months EndedMarch 31,   Change