Graham Corporation (NYSE:GHM) Q3 2024 Earnings Call Transcript February 5, 2024
Graham Corporation beats earnings expectations. Reported EPS is $0.02, expectations were $-0.04. Graham Corporation isn’t one of the 30 most popular stocks among hedge funds at the end of the third quarter (see the details here).
Operator: Greetings. Welcome to the Graham Corporation Third Quarter Fiscal Year 2024 Financial Results Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this conference is being recorded. I will now turn the conference over to Deborah Pawlowski, Investor Relations for Graham Corporation. Thank you. You may begin.
Deborah Pawlowski: Thank you, Darryl, and good morning, everyone. We certainly appreciate your time today and your interest in Graham Corporation. Here with me on the call are Dan Thoren, our President and CEO; and Chris Thome, our Chief Financial Officer. Dan and Chris are going to provide their formal remarks, after which we will open the line for questions. You should have a copy of the third quarter fiscal 2024 financial results that were released this morning. And if not, you can access the release on our website at ir.grahamcorp.com. You’ll also find there the slides that will accompany today’s discussion. If you will turn to Slide 2 on that deck, I will review the Safe Harbor statement. You should be aware that we may make some forward-looking statements during the formal discussion as well as during the Q&A session.
These statements apply to future events that are subject to risks and uncertainties as well as other factors that could cause actual results to differ materially from what is stated here today. These risks and uncertainties and other factors are provided in the earnings release as well as with other documents filed by the company with the Securities and Exchange Commission. You can find those documents on our website or at sec.gov. During today’s call, we will also discuss some non-GAAP financial measures. We believe these will be useful in evaluating our performance. However, you should not consider the presentation of this additional information in isolation or as a substitute for results prepared in accordance with GAAP. We have provided reconciliations of non-GAAP measures with comparable GAAP measures in the tables that accompany today’s release and slides.
We also use key performance indicators to help gauge the progress and performance of the company. These key performance metrics are orders, backlog, and book-to-bill ratio. They are operational measures in the company’s methodology for calculating these numbers does not meet the definition of a non-GAAP measure as that term is defined by the SEC. So, as a result, a quantitative reconciliation of each of these is not required or provided. But you can find the disclaimer regarding our use of key performance metrics at the back of our deck in the supplemental slides. So, with that, if you would please advance to Slide 3, I will turn it over to Dan to begin. Dan?
Daniel Thoren: Thanks, Debbie, and good morning, everyone. Reflecting on the past few years, we firmly believe that our business is now in a significantly improved position due to the strategic actions that we’ve taken. This has been a great team effort, and I would like to thank our customers, our employees, and our service providers for their contribution to our turnaround. In the third quarter, our performance demonstrated robust strength underscoring the consistent execution of our strategic approach aimed at cultivating high-quality top line growth, along with margin accretive initiatives to enhance our future earnings potential. Notable highlights from the quarter include gross and adjusted EBITDA margin expansion, a substantial increase in bookings that led to a record backlog of nearly $400 million, and we refinanced our debt with a lower cost and more flexible credit facility, further solidifying our financial framework.
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