MATRIX SERVICE CO
For the period ended Dec 31, 2023. Filed Feb 8, 2024.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Dec 31, 2023 · Filed Feb 8, 2024
Extracted filing text, with the paragraph anchors used by the comparison.
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Item 2. Results of Operations
| Three Months Ended | Six Months Ended | |||
|---|---|---|---|---|
| December 31,2023 | December 31,2022 | December 31,2023 | December 31,2022 | |
| Gross revenue | ||||
| Storage and Terminal Solutions | $63,074 | $63,130 | $154,053 | $140,420 |
| Utility and Power Infrastructure | 40,144 | 50,589 | 72,539 | 95,459 |
| Process and Industrial Facilities | 71,526 | 80,789 | 146,664 | 167,526 |
| Corporate | 1,233 | — | 1,233 | — |
| Total gross revenue | $175,977 | $194,508 | $374,489 | $403,405 |
| Less: Inter-segment revenue | ||||
| Storage and Terminal Solutions | $714 | $614 | $1,549 | $971 |
| Utility and Power Infrastructure | — | 54 | — | 54 |
| Process and Industrial Facilities | 221 | — | 239 | 109 |
| Corporate | — | — | — | — |
| Total inter-segment revenue | $935 | $668 | $1,788 | $1,134 |
| Consolidated revenue | ||||
| Storage and Terminal Solutions | $62,360 | $62,516 | $152,504 | $139,449 |
| Utility and Power Infrastructure | 40,144 | 50,535 | 72,539 | 95,405 |
| Process and Industrial Facilities | 71,305 | 80,789 | 146,425 | 167,417 |
| Corporate | 1,233 | — | 1,233 | — |
| Total consolidated revenue | $175,042 | $193,840 | $372,701 | $402,271 |
| Gross profit (loss) | ||||
| Storage and Terminal Solutions | $1,838 | $1,648 | $6,790 | $9,213 |
| Utility and Power Infrastructure | 1,415 | 2,426 | 5,111 | 4,139 |
| Process and Industrial Facilities | 6,671 | (5,131) | 11,749 | (801) |
| Corporate | 665 | (245) | (1,202) | (845) |
| Total gross profit | $10,589 | $(1,302) | $22,448 | $11,706 |
| Selling, general and administrative expenses | ||||
| Storage and Terminal Solutions | $4,338 | $5,450 | $8,967 | $9,608 |
| Utility and Power Infrastructure | 1,978 | 1,787 | 3,526 | 3,525 |
| Process and Industrial Facilities | 2,206 | 3,682 | 5,293 | 7,752 |
| Corporate | 7,209 | 6,626 | 15,058 | 13,471 |
| Total selling, general and administrative expenses | $15,731 | $17,545 | $32,844 | $34,356 |
| Goodwill impairment & restructuring costs | ||||
| Storage and Terminal Solutions | $— | $383 | $— | $906 |
| Utility and Power Infrastructure | — | — | — | 37 |
| Process and Industrial Facilities | — | 12,698 | — | 13,012 |
| Corporate | — | 513 | — | 926 |
| Total goodwill impairment & restructuring costs | $— | $13,594 | $— | $14,881 |
| Operating income (loss) | ||||
| Storage and Terminal Solutions | $(2,500) | $(4,185) | $(2,177) | $(1,301) |
| Utility and Power Infrastructure | (563) | 639 | 1,585 | 577 |
| Process and Industrial Facilities | 4,465 | (21,511) | 6,456 | (21,565) |
| Corporate | (6,544) | (7,384) | (16,260) | (15,242) |
| Total operating loss | $(5,142) | $(32,441) | $(10,396) | $(37,531) |
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Total assets by segment were as follows (in thousands):
| December 31,2023 | June 30,2023 | |
|---|---|---|
| Storage and Terminal Solutions | $161,409 | $139,333 |
| Utility and Power Infrastructure | 66,501 | 67,630 |
| Process and Industrial Facilities | 92,688 | 90,514 |
| Corporate | 84,236 | 103,027 |
| Total segment assets | $404,834 | $400,504 |
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Note 10 –Restructuring Costs
In fiscal 2020, we initiated a business improvement plan to increase profitability and reduce our cost structure in order to help us become more competitive and deliver higher quality service. As a result of specific events, including the effects of the COVID-19 pandemic and related market disruptions, the Company expanded its business improvement plan.
The business improvement plan consisted of an initial phase of discretionary cost reductions, workforce reductions, reduction of capital expenditures and the reduction in size or closure of certain offices in order to increase the utilization of our staff and bring the cost structure of the business in line with revenue volumes. In fiscal 2022, we commenced a second phase of our plan to focus on centralization of support functions, including business development, accounting, human resources, procurement and project services into shared service centers. During the three and six months ended December 31, 2022, we incurred restructuring costs of $1.3 million and $2.6 million, respectively. The restructuring costs were primarily related to severance and other personnel-related costs in connection with the second phase of our plan as well as the closure of an underperforming operating location. Our restructuring efforts were substantially complete as of June 30, 2023.
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