MATRIX SERVICE CO

Previous wording

These forward-looking statements include, among others, such things as:

Current wording

These forward-looking statements include, among others :

Previous wording

•the impact to our business from disruptions to supply chains, inflation and availability of materials and labor;

Current wording

•the impact to our business from disruptions to supply chains, and availability of materials and labor;

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•economic, market or business conditions in general, disruptions in the global supply chain, and in the natural gas, power, oil, petrochemical, industrial and power industries in particular;

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•economic, market or business conditions in general, disruptions in the global supply chain, and in the natural gas, oil, petrochemical, industrial and power industries in particular;

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•the under- or over-utilization of our work force;

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•the under- or over-utilization of our workforce;

Previous wording

Investors should note that we announce material financial information in SEC filings, press releases, presentations and public conference calls. Based on guidance from the SEC, we may use the Investors section of our website (www.matrixservicecompany.com) to communicate with investors and we intend to post presentations and other materials there. It is possible that the financial and other information posted to our website could be deemed to be material information.

Current wording

Investors should note that we announce material financial information in SEC filings, press releases, presentations and public conference calls. We may use the Investors section of our website (www.matrixservicecompany.com) to communicate with investors and we intend to post presentations and other materials there. It is possible that the financial and other information posted to our website could be deemed to be material information.

Previous wording

We operate our business through a number of different operating subsidiaries, which are organized into three reportable segments based on the type of work performed and the markets serviced:

Current wording

We operate our business through three reportable segments:

Previous wording

•Storage and Terminal Solutions: primarily consists of engineering, procurement, fabrication, and construction services related to cryogenic and other specialty tanks and terminals for LNG, NGLs such as butane, propane, ethane, ethylene, and other liquid petroleum products, as well as hydrogen and ammonia. We also perform work related to traditional aboveground crude oil and refined product storage tanks and terminals. This segment also includes terminal balance of plant work, truck and rail loading/offloading facilities, and marine structures as well as storage tank and terminal maintenance and repair. Finally, we manufacture and sell precision engineered specialty tank products, including geodesic domes, aluminum internal floating roofs, floating suction and skimmer systems, roof drain systems and floating roof seals.

Current wording

•Storage and Terminal Solutions: delivers integrated engineering, procurement and construction ("EPC") services, along with repair, maintenance and fabrication services for bulk liquid, cryogenic, and refrigerated storage and terminal facilities supporting both traditional and emerging energy markets, including LNG, NGLs, petroleum products, chemicals, hydrogen, and ammonia. We also manufacture and sell specialty, precision-engineered tank products, including geodesic domes, aluminum internal floating roofs, floating suction and skimmer systems, roof drain systems and floating roof seals.

Previous wording

For long-term maintenance contracts with no minimum commitments and other established customer agreements, we include only the amounts that we expect to recognize as revenue over the next 12 months. For arrangements in which we have received a LNTP, we include the entire scope of work in our backlog if we conclude that the likelihood of the full project proceeding is probable. For all other arrangements, we calculate backlog as the estimated contract amount less revenue recognized as of the reporting date. Backlog differs from the amount of our remaining performance obligations, which are described in Note 2 - Revenue in the notes to the unaudited consolidated financial statements. Differences are due primarily to the inclusion within our backlog of estimates of future revenue under long-term maintenance contracts; future revenue for the full scope of work for certain arrangements where we have received an LNTP; and future revenue for arrangements where we have received assurance that we consider firm, but the associated contract has not been fully executed.

Current wording

For long-term maintenance contracts with no minimum commitments and other established customer agreements, we include only the amounts that we expect to recognize as revenue over the next 12 months. For arrangements in which we have received an LNTP, we include the entire scope of work in our backlog if we conclude that the likelihood of the full project proceeding is probable. For all other arrangements, we calculate backlog as the estimated contract amount less revenue recognized as of the reporting date. Backlog differs from the amount of our remaining performance obligations, which are described in Note 2 - Revenue in the notes to the unaudited condensed consolidated financial statements. Differences are due primarily to the inclusion within our backlog of estimates of future revenue under long-term maintenance contracts; future revenue for the full scope of work for certain arrangements where we have received an LNTP; and future revenue for arrangements where we have received assurance that we consider firm, but the associated contract has not been fully executed.

Previous wording

In the Storage and Terminal Solutions segment, we booked $37.5 million of project awards during the third quarter of fiscal 2026. During the nine months ended March 31, 2026, we booked $298.2 million of project awards. This segment includes significant opportunities for storage infrastructure projects related to natural gas, LNG, ammonia, NGLs and other forms of low carbon energy. We believe LNG, NGLS and ammonia projects in particular will be key growth drivers for this segment. Bidding activity in these markets has been strong and we expect that to continue.

Current wording

In the Storage and Terminal Solutions segment, we booked $29.8 million of project awards during the first quarter of fiscal 2027. This segment includes significant opportunities for storage infrastructure projects related to natural gas, LNG, ammonia, NGLs and other forms of low carbon energy. We believe LNG and NGL projects in particular will be key growth drivers for this segment. Bidding activity in these markets has been strong and we expect that to continue.

Previous wording

In the Utility and Power Infrastructure segment, we booked $46.6 million of project awards during the third quarter of fiscal 2026. During the nine months ended March 31, 2026, we booked $97.2 million of project awards. Our opportunity pipeline for LNG peak shaving projects continues to be promising, with both greenfield facility projects as well as the projects for the upgrade, maintenance, and repair to existing infrastructure. The timing between the major greenfield awards can be extended due to the client activity and bidding diligence, but their addition to backlog is significant and will drive long-term sustainable growth in the segment. The smaller upgrade projects are key measures of our brand power and strength in the market, keeping key resources active while creating opportunities to strengthen execution and engineering teams. Power generation and delivery infrastructure opportunities are expected to be driven over the long-term by increasing electrical demand and the related electrical grid requirements. Project opportunities and bidding activity are strong across the segment.

Current wording

In the Utility and Power Infrastructure segment, we booked $58.2 million of project awards during the first quarter of fiscal 2027. Awards during the first quarter of fiscal 2027 include an LNTP for a meaningful power generation project supporting data center infrastructure. Our opportunity pipeline for LNG peak shaving projects continues to be promising, with both greenfield facility projects as well as the projects for the upgrade, expansion, maintenance, and repair to existing infrastructure. The timing between the major greenfield and expansion awards can be extended due to client activity and bidding diligence. However, their addition to backlog is significant and we expect it to drive long-term sustainable growth in the segment. The smaller upgrade projects are key measures of our brand power and strength in the market, keeping key resources active while creating opportunities to strengthen execution and engineering teams. Power generation and delivery infrastructure opportunities are expected to be driven over the long-term by increasing electrical demand and the related electrical grid requirements associated with data centers and other demands. Project opportunities and bidding activity are strong across the segment.

Previous wording

In the Process and Industrial Facilities segment, we booked $24.1 million of project awards during the third quarter of fiscal 2026. During the nine months ended March 31, 2026, we booked $77.3 million of project awards. We continue to see increasing opportunities in chemicals, renewable fuels, and refinery maintenance and turnarounds. Additionally, after an extended period of limited investment, activity in the U.S. non-ferrous mining sector has begun to improve, supported by demand growth in copper and higher gold prices, as well as policy initiatives related to critical minerals.

Current wording

In the Process and Industrial Facilities segment, we booked $50.8 million of project awards during the first quarter of fiscal 2027. We continue to see increasing opportunities in chemicals, renewable fuels, and refinery maintenance and turnarounds. Additionally, after an extended period of limited investment, activity in the U.S. non-ferrous mining sector has increased significantly, supported by demand growth in copper and higher gold prices, as well as policy initiatives related to critical minerals.

Previous wording

Revenue - The increase in consolidated revenue of $6.5 million, or 3%, was attributable to higher revenue volumes in our Storage and Terminal Solutions segment, partially offset by lower revenue volumes in our Processing and Industrial Facilities segment.

Current wording

Revenue - The increase in consolidated revenue of $7.5 million, or 4%, was attributable to higher revenue volumes in our Storage and Terminal Solutions and Processing and Industrial Facilities segments, partially offset by lower revenue volumes in our Utility and Power Infrastructure segment.

Previous wording

Gross profit - Gross profit in the third quarter of fiscal 2026 increased $4.3 million, or 33%, compared to the third quarter of fiscal 2025. Gross margin was 8.3% for the third quarter of fiscal 2026 compared to gross margin of 6.4% for the third quarter of fiscal 2025. The increase in gross margin was due to higher gross margins in the Storage and Terminal Solutions and Utility and Power Infrastructure segments, partially offset by lower gross margins in the Process and Industrial Facility segment. Overall, gross margins during the period benefited from strong project execution and improved overhead recovery.

Current wording

Gross profit - Gross profit in the first quarter of fiscal 2027 increased $3.9 million, or 27%, compared to the first quarter of fiscal 2026. Gross margin was 8.2% for the first quarter of fiscal 2027 compared to gross margin of 6.7% for the first quarter of fiscal 2026. The increase in gross margin was due to higher gross margins in the Storage and Terminal Solutions segment, partially offset by lower gross margins in the Process and Industrial Facilities segment. Overall, gross margins during the period benefited from strong project execution and improved overhead recovery.

Previous wording

Selling, general and administrative expenses - The decrease in SG&A expenses of $6.9 million, or 13%, is due in part to cost reductions resulting from our organizational restructuring plan. Stock compensation also decreased by $1.5 million, due in part to executive separations occurring during the third quarter of fiscal 2026. Additionally, SG&A decreased $1.7 million associated with the variable accounting for cash-settled stock-based compensation, primarily as a result of fluctuations in our stock price.

Current wording

Selling, general and administrative expenses - The decrease in selling, general and administrative expenses ("SG&A") of $3.0 million, or 18%, was due in part to lower salaries and wages and stock compensation expense resulting from our organizational restructuring plan. Additionally, SG&A decreased $1.9 million associated with the variable accounting for cash-settled stock-based compensation, primarily as a result of fluctuations in our stock price.

Previous wording

Provision for income taxes - Income tax expense for both periods was insignificant. The effective tax rates during both periods were impacted by valuation allowances of $0.2 million and $1.2 million, respectively, placed on deferred tax assets generated during the quarters. We placed a valuation allowance on our deferred tax assets due to the existence of a cumulative loss over a three-year period. Currently, we place valuation allowances on newly generated deferred tax assets. We will realize the benefit associated with the deferred tax assets for which the valuation allowance has been provided as we generate taxable income.

Current wording

Provision for income taxes - Income tax expense for both periods was insignificant. The effective tax rates during both periods were impacted by valuation allowances of $(2.0) million and $1.4 million, respectively, placed on deferred tax assets generated during the periods. We placed a valuation allowance on our deferred tax assets due to the existence of a cumulative loss over a three-year period. Currently, we place valuation allowances on newly generated deferred tax assets. We will realize the benefit associated with the deferred tax assets for which the valuation allowance has been provided as we generate taxable income.

Previous wording

Storage and Terminal Solutions revenues increased by $15.6 million, or 16%, in the three months ended March 31, 2026 compared to the same period last year, driven by an increased volume of work for LNG projects.

Current wording

Storage and Terminal Solutions revenues increased by $13.4 million, or 12%, in the three months ended September 30, 2026 compared to the same period last year, driven by an increased volume of work for specialty tanks and the associated balance of plant.

Previous wording

Storage and Terminal Solutions gross profit increased by $4.0 million, or 108%, in the three months ended March 31, 2026 compared to the same period last year. The segment gross margin of 7.0% for the three months ended March 31, 2026 was higher than segment gross margin of 3.9% in the same period last year. Margin improvement was driven by improved project execution overall as well as an improvement in overhead cost absorption.

Current wording

Storage and Terminal Solutions gross profit increased by $4.5 million, or 69%, in the three months ended September 30, 2026 compared to the same period last year. The segment gross margin of 9.0% for the three months ended September 30, 2026 was higher than segment gross margin of 5.9% in the same period last year. Margin improvement was driven by improved project execution overall as well as an improvement in overhead cost absorption.

Previous wording

Unrestricted cash and cash equivalents at March 31, 2026 totaled $233.0 million and availability under the ABL Facility totaled $64.2 million, resulting in total liquidity of $297.2 million. During the third quarter of fiscal 2026, liquidity increased $39.6 million primarily as a result of changes in working capital. During the nine months ended March 31, 2026, liquidity increased by $12.7 million primarily as a result of changes in working capital.

Current wording

Unrestricted cash and cash equivalents at September 30, 2026 totaled $182.4 million and availability under the ABL Facility totaled $39.4 million, resulting in total liquidity of $221.8 million. During the first quarter of fiscal 2027, liquidity decreased, primarily as a result of changes in working capital. Additionally, our availability under the ABL Facility decreased due to an increase in outstanding letters of credit. In the first quarter of fiscal 2027, we issued a $20.0 million project-related letter of credit, which resulted in a release of $20.0 million of contract retention.

Previous wording

The following table provides a reconciliation of restricted cash and unrestricted cash in the Consolidated Balance Sheets to the total cash, cash equivalents and restricted cash shown in the Consolidated Statements of Cash Flows, as well as availability and total liquidity (in thousands):

Current wording

The following table provides a reconciliation of restricted cash and unrestricted cash in the Condensed Consolidated Balance Sheets to the total cash, cash equivalents and restricted cash shown in the Condensed Consolidated Statements of Cash Flows, as well as availability and total liquidity (in thousands):

Previous wording

Factors that routinely impact our short-term liquidity and may impact our long-term liquidity include, but are not limited to:

Current wording

Factors that routinely impact our short-term liquidity and may impact our long-term liquidity include:

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◦some fixed-price customer contracts allow for significant upfront billings at the beginning of a project, which increases liquidity near term;

Current wording

◦some fixed-price customer contracts allow for upfront billings at the beginning of a project, which increases liquidity near term;

Previous wording

The borrowing base is recalculated on a monthly basis and at March 31, 2026, our borrowing base was $68.6 million. We had no borrowings outstanding and $4.4 million in letters of credit outstanding, which resulted in availability of $64.2 million under the ABL Facility. For additional information regarding our ABL Facility, see Item I of Part I, "Financial Statements - Note 4 - Debt."

Current wording

The borrowing base is recalculated on a monthly basis and at September 30, 2026, our borrowing base was $61.8 million. We had no borrowings outstanding and $22.4 million in letters of credit outstanding, which resulted in availability of $39.4 million under the ABL Facility. For additional information regarding our ABL Facility, see Item 1 of Part I, "Financial Statements - Note 4 - Debt."

Previous wording

The significant components of the $5.1 million change in operating assets and liabilities for the nine months ended March 31, 2026 are summarized as follows:

Current wording

The significant components of the $46.4 million change in operating assets and liabilities for the three months ended September 30, 2026 are summarized as follows:

Previous wording

•Accounts receivable, excluding credit losses recognized during the period and including retention amounts classified as non-current, increased by $88.8 million which decreased cash flows from operating activities. The increases are primarily attributable to the timing of billing and collections.

Current wording

•Accounts receivable, excluding credit losses recognized during the period and including retention amounts classified as non-current, decreased by $4.9 million from 2026, which increased cash flows from operating activities. The decrease is primarily attributable to the timing of billing and collections.

Previous wording

•Costs and estimated earnings in excess of billings on uncompleted contracts ("CIE") decreased $4.8 million which increased cash flows from operating activities. Billings on uncompleted contracts in excess of costs and estimated earnings ("BIE") increased $17.1 million which increased cash flows from operating activities. CIE and BIE balances can experience significant fluctuations based on business volumes and the timing of when job costs are incurred and the timing of customer billings and payments. Some fixed-price customer contracts allow for significant upfront billings at the beginning of a project, which increases liquidity near-term.

Current wording

•Costs and estimated earnings in excess of billings on uncompleted contracts ("CIE") decreased $0.2 million which increased cash flows from operating activities. Billings on uncompleted contracts in excess of costs and estimated earnings ("BIE") decreased $8.9 million which decreased cash flows from operating activities. CIE and BIE balances can experience significant fluctuations based on business volumes and the timing of when job costs are incurred and the timing of customer billings and payments. Some fixed-price customer contracts allow for significant upfront billings at the beginning of a project, which increases liquidity near-term.

Previous wording

•Accounts payable increased by $13.0 million which increased cash flows from operating activities. These operating liabilities can fluctuate based on business volumes; the timing of vendor payments; accruals; and other timing differences.

Current wording

•Accounts payable decreased by $23.2 million which decreased cash flows from operating activities. These operating liabilities can fluctuate based on business volumes; the timing of vendor payments; accruals; and other timing differences.

Previous wording

•Changes in other operating assets and liabilities decreased cash flows from operating activities by $10.0 million. These operating assets and liabilities can fluctuate based on business volumes and timing of certain cash receipts and payments. Additionally, we generally prepay our annual insurance premiums in the first quarter of the fiscal year.

Current wording

•Changes in other operating assets and liabilities decreased cash flows from operating activities by $19.4 million. These operating assets and liabilities can fluctuate based on business volumes and timing of certain cash receipts and payments. Additionally, we generally prepay our annual insurance premiums in the first quarter of the fiscal year.

Previous wording

The significant components of the $80.7 million change in operating assets and liabilities for the nine months ended March 31, 2025 are summarized as follows:

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The significant components of the $28.0 million change in operating assets and liabilities for the three months ended September 30, 2025 are summarized as follows:

Previous wording

•Accounts receivable, excluding credit losses recognized during the period and including retention amounts classified as non-current, increased by $16.0 million which decreased cash flows from operating activities. The increases are primarily attributable to the timing of billing and collections.

Current wording

•Accounts receivable, excluding credit losses recognized during the period and including retention amounts classified as non-current, increased by $15.1 million which decreased cash flows from operating activities. The increase is primarily attributable to the timing of billing and collections.

Previous wording

•Costs and estimated earnings in excess of billings on uncompleted contracts ("CIE") increased $4.7 million which decreased cash flows from operating activities. Billings on uncompleted contracts in excess of costs and estimated earnings ("BIE") increased $161.3 million which increased cash flows from operating activities. CIE and BIE balances can experience significant fluctuations based on business volumes and the timing of when job costs are incurred and the timing of customer billings and payments. Some fixed-price customer contracts allow for significant upfront billings at the beginning of a project, which increases liquidity near-term.

Current wording

•Costs and estimated earnings in excess of billings on uncompleted contracts ("CIE") increased $8.1 million which decreased cash flows from operating activities. Billings on uncompleted contracts in excess of costs and estimated earnings ("BIE") decreased $6.0 million which decreased cash flows from operating activities. CIE and BIE balances can experience significant fluctuations based on business volumes and the timing of when job costs are incurred and the timing of customer billings and payments. Some fixed-price customer contracts allow for significant upfront billings at the beginning of a project, which increases liquidity near-term.

Previous wording

•Accounts payable increased by $9.2 million which increased cash flows from operating activities. These operating liabilities can fluctuate based on business volumes; the timing of vendor payments; accruals; and other timing differences.

Current wording

•Accounts payable increased by $17.7 million which increased cash flows from operating activities. These operating liabilities can fluctuate based on business volumes; the timing of vendor payments; accruals; and other timing differences.

Previous wording

•Changes in other operating assets and liabilities decreased cash flows from operating activities by $0.1 million. These operating assets and liabilities can fluctuate based on business volumes and timing of certain cash receipts and payments. Additionally, we generally prepay our annual insurance premiums in the first quarter of the fiscal year.

Current wording

•Changes in other operating assets and liabilities decreased cash flows from operating activities by $16.5 million. These operating assets and liabilities can fluctuate based on business volumes and timing of certain cash receipts and payments. Additionally, we generally prepay our annual insurance premiums in the first quarter of the fiscal year.

Previous wording

Investing activities used $2.6 million and $5.2 million of cash in the nine months ended March 31, 2026 and 2025, respectively. Capital expenditures were $4.1 million and $5.4 million in the nine months ended March 31, 2026 and 2025, respectively. During the nine months ended March 31, 2026, we also received $1.5 million of proceeds from the sale of property plant and equipment, primarily associated with our transmission and distribution service line, which we began winding down in the fourth quarter of fiscal 2025.

Current wording

Investing activities used $0.4 million and $1.8 million of cash in the three months ended September 30, 2026 and 2025, respectively. Capital expenditures were $0.8 million and $2.0 million in the three months ended September 30, 2026 and 2025, respectively.

Previous wording

Financing activities used $4.2 million and $1.1 million of cash in the nine months ended March 31, 2026 and 2025, respectively, primarily due to payments of $4.2 million and $1.2 million, respectively, to satisfy tax withholding obligations associated with stock-based compensation.

Current wording

Financing activities used $3.4 million and $4.3 million of cash in the three months ended September 30, 2026 and 2025, respectively, primarily due to payments of $0.9 million and $4.2 million, respectively, to satisfy tax withholding obligations associated with stock-based compensation. Additionally, during the three months ended September 30, 2026, we repurchased 234,800 shares of our common stock for $2.5 million.

Previous wording

We have never paid cash dividends on our common stock and the terms of our ABL Facility limit dividends to stock dividends only. Any future dividend payments will depend on the terms of our ABL Facility, our financial condition, capital requirements and earnings as well as other relevant factors.

Current wording

We have never paid cash dividends on our common stock and the terms of our ABL Facility limit dividends to stock dividends other than certain cash dividends under management or employee benefit plans. Any future dividend payments will depend on the terms of our ABL Facility, our financial condition, capital requirements and earnings as well as other relevant factors.

Previous wording

We may repurchase common stock pursuant to the Stock Buyback Program, which was approved by the board of directors in November 2018. Under the program, the aggregate number of shares repurchased may not exceed 2,707,175 shares. We may repurchase our stock from time to time in the open market at prevailing market prices or in privately negotiated transactions and are not obligated to purchase any shares. The program will continue unless and until it is modified or revoked by the Board of Directors. We made no repurchases under the program in the three months ended March 31, 2026 and have no current plans to repurchase stock. As of March 31, 2026, there were 1,349,037 shares available for repurchase under the Stock Buyback Program. The terms of our ABL Facility limit share repurchases to $2.5 million per fiscal year provided that we meet certain availability thresholds and do not violate our Fixed Charge Coverage Ratio financial covenant.

Current wording

In November 2018, the board of directors authorized a share repurchase program (the "Stock Buyback Program") under which the aggregate number of shares repurchased may not exceed 2,707,175 shares. During the three months ended September 30, 2026, we repurchased 234,800 shares for $2.5 million. As of September 30, 2026, there were 1,114,237 shares available for repurchase under the Stock Buyback Program. On November 3, 2026, the Board of Directors approved a new stock buyback program (the "November 2026 program"), which replaced the previous program. Under the November 2026 program, we may repurchase common stock of the Company up to an aggregate purchase price of $25 million. The November 2026 program expires in November 2028. The terms of our ABL Facility, among other things, limit share repurchases to $25.0 million per fiscal year provided that we meet certain availability thresholds. We may repurchase our stock from time to time in the open market at prevailing market prices or in privately negotiated transactions and are not obligated to purchase any shares.