Greetings, and welcome to the Northwest Pipe Company Q3 2023 earnings conference call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded. I would now like to turn the conference over to your host, Mr. Scott Montross, President and CEO of Northwest Pipe Company. Thank you. You may begin. Good morning, and welcome to Northwest Pipe Company's Q3 2023 earnings conference call. My name is Scott Montross, and I am President and CEO of the company. I am joined today by Aaron Wilkins, our Chief Financial Officer. By now, all of you should have access to our earnings press release, which was issued yesterday, November 2, 2023, at approximately 4 P.M. Eastern Time. This call is being webcast and it is available for replay. As we begin, I would like to remind everyone that statements made on this call regarding our expectations for the future are forward-looking statements, and actual results could differ materially. Please refer to our most recent Form 10-K for the year ended December 31, 2022, and in our other SEC filings for a discussion of such risk factors that could cause actual results to differ materially from our expectations. We undertake no obligation to update any forward-looking statements. Thank you all for joining us today. I'll begin with a review of our Q3 performance and outlook. Aaron will then walk you through our financials in greater detail. Our Q3 revenue of $118.7 million improved 2% over the Q2 and declined by 3.5% compared to the prior year quarter. Revenue from our SPP segment remained fairly strong, but decreased 3.8% to $80.5 million compared to the prior year quarter, coming in below our expectations due to one-time anomalies that impacted both revenue and gross margins in the Q3. First, we had some customer-driven contract changes as well as scope changes of certain projects that had previously been forecasted to benefit the Q3. We also encountered some customer-related delays that impacted project delivery timing, which pushed projects scheduled to be produced in the Q3 out into early 2024. This led to short-term production gaps at certain plants, causing higher levels of under- absorption, further impacting our revenue and margins for the quarter. In addition to these non-recurring items, higher selling prices in our SPP business due to sales mix were partially offset by decrease in tons produced, resulting primarily from changes in project timing. Prices of hot-rolled band steel declined approximately 27% from the Q2 to the Q3, but have increased rapidly by approximately 16% from September through year-to-date Q4. SPP backlog, including confirmed orders, was $335 million at September 30, which modestly declined from $343 million at June 30, 2023, and from $347 million as of September 30, 2022. Our backlog remains elevated by historical standards, even though 2023 has been a relatively small bidding year. Now turning to our Precast segment. Precast revenue decreased 2.8% from the prior year quarter to $38.2 million, primarily due to reduced demand resulting from the current interest rate environment impacting the US construction market, which led to decreased absorption of overhead, changes in our product mix and reduced selling prices given lower market demand, all while raw material input costs have remained fairly elevated. Nevertheless, as we progress into a slower period Precast time of the year in the Q4, our Precast-related order book has remained fairly strong and totaled $52 million as of September 30, 2023, which was down from $58 million as of June 30, 2023, and down from $74 million as of September 30, 2022. Our Q3 consolidated gross profit decreased 23.2% year over year to $19.3 million, resulting in a gross margin of 16.3%, down from 20.4% in the Q3 of 2022. Our SPP gross margin of 13.6% declined by approximately 340 basis points over Q3 2022, primarily due to the anomalies I just discussed, including customer-driven contract changes and project scope changes that reduced the gross profit we expected to realize in the Q3, and from customer-driven changes in project delivery timing, which pushed projects that were scheduled to be produced in the Q3 out in early 2024 and created near-term production gaps at certain plants, leading to higher levels of under-absorption. Absent these items, we estimate that our SPP gross margins would have been approximately 200 basis points higher. Also important to note is that we are starting to see the relatively small SPP bidding market we have experienced in 2023 result in some pressure on project margins for projects that are currently bidding. Our Precast gross margin of 21.9% of Precast sales in the Q3 of 2023 decreased by approximately 590 basis points from the near record highs experienced in the Q3 of 2022. The decline was predominantly due to the impact of rising interest rates on the commercial construction and residential housing markets, which moderately reduced Precast product demand, reducing overhead absorption and resulting in changes in our product mix. This led to our margins normalizing compared to the record year we had in 2022. Next, I would like to provide an update on our capital allocation priorities. Our focus on organic growth of the business remains a top priority by means of our product spread strategy with our Precast operations. The acquisition of ParkUSA in October of 2021 spawned this strategy, given the Park business employs some of the same capabilities that we have at our other Northwest Pipe facilities, namely the production of Precast vaults and fabricated steel housings, which in the case of ParkUSA, serve as containment units for the water control system products and the water-related environmental solution systems. As such, our Level 1 product spread effort has been ramping to build out our capacity utilization at our Texas-based ParkUSA plants to maximize efficiency and production. To that end, the ParkUSA team has bid on approximately $32 million worth of projects outside of Texas, year-to-date, 2023, predominantly in the Western and Southeastern regions of the United States. Of that, year-to-date, the team has booked approximately $7.1 million worth of orders outside of Texas, up from $4.5 million in the Q2. Over the last twelve months, we've successfully booked approximately $8 million in projects, and we are just getting started. Level 2 product spread comes into play because we also produce the Concrete Vaults and steel fabrication at the current Northwest Pipe plants. As such, we're in the early stages of bringing the production of ParkUSA's products to our existing Northwest Pipe locations, which we believe will provide incremental organic growth potential to the company. As previously discussed, our Geneva Precast operations have been serving as the pilot locations for level two product spread activity. Year to date in 2023, we have produced 10 projects at Geneva and are currently in production on 3 Park product orders, with more scheduled to come. We plan to expand upon level two product spread once Park products are more comfortably established at the Geneva locations, before we expand the Park products to additional Northwest Pipe legacy plants. We remain confident in our organic growth strategy for the Precast to further diversify our business, with the goal of improving our resiliency through economic cycles and driving long-term, consistently profitable growth. Despite the short-term challenges affecting the Precast business, we believe in the long-term value proposition of this space and investments that we are making to drive sustainable growth. Following organic growth, we remain highly focused on repaying the debt incurred to finance the acquisition of ParkUSA in order to position ourselves for further acquisitions, but only after we are comfortable that ParkUSA has been fully integrated. I'll next turn to our M&A strategy, in which we currently are continuing to seek accretive acquisition candidates in the Precast-related space. While the integration of ParkUSA remains paramount, including the finalization of the ERP system integration, which is expected to be completed by the end of this year, we are continuing to evaluate prospective high-quality opportunities that possess strong organic growth potential in margin characteristics, solid asset efficiency, and positive cash flow profiles. We recognize that finding the right opportunities takes significant due diligence and time, and as such, we are pleased that our board has authorized a stock repurchase program in the amount of $30 million with no expiration date, underscoring their confidence in our long-term strategic growth plan in alignment with our goal to enhance shareholder value. In the absence of meaningful M&A activity, we may opt to return value to our stockholders via opportunistic share repurchases as we deem appropriate. Obviously, any repurchases would be subject to our liquidity, including availability of borrowings and covenant compliance under our amended credit facility and other capital needs of the business. Before I conclude, I'd like to summarize our outlook for the remainder of the year. Aside from some of the challenges we are continuing to work through, such as our ERP implementation and the resultant impact the current interest rate environment has had on our business, our outlook for the balance of 2023 remains positive. In our SPP business, we anticipate a strong Q4, given various customer-driven anomalies that I just discussed, that we faced during the Q3 that are not expected to be recurring, as well as continued strength in our backlog. We entered 2023 with a robust Steel Pressure Pipe backlog, near record territory, which has remained elevated and should carry us through into 2024 and lead to a strong finish to 2023. Despite the relatively small level of bidding that we've seen this year. However, over the last few months, the small bidding environment has caused downward pressure on project bidding. As such, we expect Q4 SPP revenue to be in line with the Q4 of 2022, but with some downward pressure on gross margins. I'd also like to add that we remain encouraged by the amount of activity we're seeing on our current and upcoming water transmission projects, as we are currently expecting a larger bidding year in 2024. For a more complete review of the projects, please review our investor presentation, which can be found on the Investor tab of our website within the Events and Presentation section. In our Precast business, we anticipate macroeconomic factors to continue to weigh on our volume. As a result, our Precast revenue in the Q4 is expected to be modestly down from the prior year period, with margins that are down from 2022 record highs, but similar to what we've seen in the second and Q3 of 2023. We continue to believe our Precast business is well positioned to benefit longer term, given the significant level of pent-up demand, specifically for residential housing, a growing need for infrastructure spending in the United States, and our strong market position. In summary, I'd like to thank our team for the continued solid execution against our strategic plan to drive enhanced shareholder value and long-term profitable growth. With our nationwide footprint and as an industry leader in this space, we are well-positioned to participate in the increasing amount of water infrastructure projects required to support the increasing US population in the years to come. As a result, our goal remains for our Precast-related business to grow to a similar size as our SPP business. Looking ahead, we will remain focused on, ontwo, finalizing the integration of ParkUSA as quickly as and efficiently as possible. two, persistently focus on margin over volume. three, continuing to implement cost reductions and efficiencies at all levels of the company. four, continuing to identify strategic growth opportunities for the company once we've completed the integration work with ParkUSA. And five, in the absence of M&A opportunities, returning value to our stockholders through opportunistic share repurchases. Thank you to our dedicated team at Northwest Pipe for your continued persistence and execution against our growth strategy and for operating safely. I will now turn the call over to Aaron, who will walk through our financial results in greater detail. Thank you, Scott, and good morning, everyone. I'll begin today with an overview of our Q3 profitability. Consolidated net income for the Q3 was $5.8 million, or $0.58 per diluted share, compared to $10 million or $0.99 per diluted share in the Q3 of 2022. Consolidated net sales decreased 3.5% to $118.7 million, compared to $123 million the year ago quarter. Steel Pressure Pipe segment sales decreased 3.8% to $80.5 million, compared to $83.7 million in the Q3 of 2022. The decrease, which Scott discussed earlier, was driven largely by customer-driven contract changes, as well as other anomalies that impacted production timing. This resulted in a 13% decrease in tons produced, which was partially offset by an 11% increase in selling price per ton, primarily due to product mix. Precast Segment sales decreased 2.8% to $38.2 million, compared to $39.3 million in the Q3 of 2022, primarily due to an 8% decrease in selling prices due to reduced demand, which was partially offset by a 6% increase in volume shipped due to changes in product mix. Due to the unique nature of the products we manufacture, shipment volumes in the case of Precast and production volumes in the case of SPP, and the corresponding sales prices for both segments do not always provide comparable metrics between periods, as they are highly dependent on the composition of the mix of our products. Consolidated gross profit decreased 23.2% to $19.3 million, or 16.3% of sales, compared to $25.1 million, or 20.4% of sales in the Q3 of 2022. Steel Pressure Pipe gross profit decreased 23.1% to $10.9 million or 13.6% of segment sales. This compared to gross profit of $14.2 million or 17% of segment sales in the Q3 of 2022, primarily due to contract changes and project timing delays. It's important to note that while timing delays are typical for the Steel Pressure Pipe business, the magnitude of these changes reduced revenue and production efficiencies at certain plants, resulting in a significant variance from our expectations for the Q3. Precast gross profit decreased 23.2% to $8.4 million or 21.9% of Precast sales from $10.9 million or 27.8% of segment sales in the Q3 of 2022, primarily due to changes in product mix. We have seen our commercial construction Precast markets decrease. However, our residential Precast markets have held up better to the current pressures from the broader economy. Selling, general, and administrative expenses decreased 3.9% to $10.2 million or 8.7% of sales, compared to $10.7 million in the Q3 of 2022, or 8.6% of sales. The decrease was primarily due to $2 million in lower incentive and compensation expense, partially offset by $0.9 million in higher professional services, including ERP implementation fees and $0.7 million in higher base compensation and benefits expense. For the full year of 2023, we expect our consolidated selling, general, and administrative expenses to be approximately $44 million. Depreciation and amortization expense in the Q3 of 2023 was $4 million, compared to $4.3 million in the year ago quarter, and I currently expect the quarterly run rate to continue at a similar pace. Our non-cash incentive compensation expenses were $0.7 million and $1.2 million in the Q3s of 2023 and 2022, respectively. Interest expense increased to $1.2 million, compared to $1 million in the Q3 of 2022. We continue to hedge approximately half of our exposure to variable interest rates using interest rate swaps. Due to the dramatic increase in the risk-free interest rates compared to the year-ago quarter, our interest costs increased, even though our average debt balance decreased from the Q3 of 2022. We expect interest expense of approximately $5 million for full year 2023. Our Q3 income tax expense was $2 million, resulting in an effective income tax rate of 25.7% compared to $3.6 million in the prior year quarter, or an effective income tax rate of 26.3%. Our tax rates for the Q3s of 2023 and 2022 were impacted by nondeductible permanent differences. We continue to expect our tax rate for full year 2023 to range between 25% and 26%. Now I will transition to our financial condition. We generated net cash provided by operating activities of $16.9 million in the Q3 of 2023, compared to $15.3 million in the Q3 of 2022, due to changes in working capital, partially offset by lower net income adjusted for non-cash items. Our capital expenditures totaled $4.9 million in the Q3 of 2023, compared to $3.3 million in the Q3 of 2022. We anticipate our total CapEx to be in the range of $18 to 21 million for full year 2023. As of September 30, 2023, we had $58.1 million of outstanding borrowings on our credit facility, leaving approximately $66 million in additional borrowing capacity on our credit line. Before I conclude, I'd like to provide an update on the progress we've made with the ongoing ERP implementation and material weakness remediation projects. With respect to the ERP implementation, we continue to meet project milestones and remain on schedule. We are working through user testing and broader training of the workforce in advance of our initial deployment of materials resource planning, or MRP automation, by the end of the year. I'm proud of the team's incremental gains in data management and business process improvement. Physical inventories are detecting fewer variances, which will reduce our dependency on these labor-intensive events. As for the material weakness remediation, this remains a top priority for management and our audit committee. We have instituted more robust internal monitoring of our manual controls that failed at ParkUSA while related to revenue and cost of sales, while we continue to focus on addressing specific concerns that arose from system development lifecycle control failures noted in last year's audit. Importantly, the internal control deficiencies identified have not impacted the accuracy of our current or historical financial results. In closing, even though we encountered some anomalies that impacted our Q3 financial results, I'm very pleased with the progress our team has made, positioning us well for a solid finish to 2023 and the year ahead. We remain steadfast in our commitment to drive long-term growth and enhance shareholder value. I would also like to thank our employees for their continued prioritization of our safety program and express gratitude to all our stakeholders for their continued confidence in Northwest Pipe. I will now turn it over to the operator to begin the question and answer session. Thank you. At this time, we'll be conducting a question and answer session. If you'd like to ask a question, please press star one on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star two if you'd like to remove yourself from the question queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Our first question comes from the line of Brent Thielman with DA Davidson. Please proceed with your question. Hey, thanks. Good morning, Scott, Aaron. Hey, Brent. Good morning, Brent. Hey, on SPP, maybe could you just talk about the nature of the delays you're experiencing? It doesn't sound like isolated cases, but maybe it is. And then I guess, Scott, kind of what gives you the confidence that the schedules into the Q1 are firm? Yeah, Brent, we—I mean, it was a little bit of a messy quarter on Steel Pressure Pipe. And I think, you know, the way to describe it is, you know, these are customer delivery-driven changes in contracts and contract scopes. And, you know, we have some projects that are Design-Build projects, which means that you're getting the project generally from the contractor or owner before it's fully designed. So normally, they're probably 90% or 95% designed, and the case that we had this time, it was probably 80%-85% designed. And as a result, I mean, you're going forward with a value that you think you have with the customer going forward, but scope can change as you go through a project. Normally, these projects will go for, like, a year or a year and a half, sometimes even longer, with these Design-Build projects. But this was a relatively large project that was Design-Build, that actually went off in, like, 5 to 6 months. So the changes were happening quickly, and ultimately the project scope changed and reduced what the project was. That was one piece. But the other piece was another Design-Build project that was having design issues that was supposed to be done and made in the Q3, that ended up getting pushed into the Q1 of 2023. And we'd see these once in a while, but these are two relatively large projects that really had an impact. And yeah, we don't see these things reappearing. These, you see them happen on a smaller scale, but generally, the Design- Build projects don't move as quickly as some of the things are happening now. I think there's a little bit of a change in the business, Brent, because obviously, you know, we're trying to promote change and get progress payments on stuff and get paid in advance for steel and things of that nature. So some of these projects are starting to come out and move a little bit quicker now, which we obviously have to pay more attention to. But that really is what caused the issue in the Q3. So, what was the second part of the question, Brent? ... you know, I think you answered it, Scott. It was really just the confidence that the schedules for these are kind of firm as we get into the early part of next year. Yeah. Yeah, I think we're looking pretty firm right now. Obviously, this has been a pretty small bidding year, right? If you think back to when we saw bidding years like this in the past, you know, especially with Steel Pressure Pipe, back to 2015, 2016 and 2017, I don't probably have to remind you too much of what the margins looked like in those years. I think one of the exciting things is, while the quarter was disappointing, the one of the exciting things is that even with markets this small, I mean, these are not great margins, but they're okay margins in a market this small, which really kind of speaks that there's been a little bit of a change in the market resiliency based on the current configuration in the market. Ultimately, obviously, due to the consolidation in the market, which we were a big part of, which really bodes well for the Steel Pressure Pipe business as we get into bigger markets, which we expect to do in 2024. We expect that market in 2024 to be quite a bit bigger than it was in 2023. So I think we're in pretty good shape with that. Okay. Yeah, and on that front, Scott, do these delays impede your ability to add new business in SPP? No. Even though the production is sort of allocated, you can still fill it in? No. Yeah, I mean, we have more than enough production capacity, practical production capacity, to probably handle most of what's coming out in the market. Some of the timing gets a little bit dicey on projects, and you can't handle them based on things being pushed out. But in any given quarter, we might be producing on somewhere between 50 and 100 different projects, so across all of our plants. Plus, obviously, we have the ability to move stuff around because we've got a nationwide footprint and deploy different assets, unlike a lot of our competitors. Okay. And then on Precast, I mean, the sales line was sort of right as we'd anticipated, and I think you've been articulating, maybe the margins were a little lighter than what we were thinking about. Maybe if you could just kind of level set us on where you expect the margins for the business to be- Yeah. in consideration of... Look, I mean, we understand there's some slack in some of these markets, but- Yeah. Yeah. Yeah. It'd just be helpful. Yeah. I think probably, you know, everybody compares things that are going on to what 2022 was, right? In 2022 was... I mean, those, those were boom. That was a boom year for Precast. There was a lot of records set in that business. You know, going through this year, you know, we're, we're modestly off of the revenues that we saw in 2022. It's obviously the higher interest rates that are affecting both the residential and the non-residential part of the market. So you have reduced production levels, and obviously with those reduced production levels, you have lower levels of overhead absorption. Along with less demand, you get a little bit of price pressure because we're seeing that. And also, product mix. We're seeing some product mix changes in the Precast business right now versus what we saw in 2023. Maybe some products that have a little bit lower margin profile than what we saw in 2023. But all in all, I mean, I think when you start looking at where we expect to be, I think when you look at the Q2, our margins for the Q2 Precast were about 25%. In the Q3, they were about 22%. So I think what you're seeing is margins are going to be lining up with that as we go through the rest of this year. As we go into next year, obviously, they're predicting some different things for next year, especially around the midpoint in the year, where they think that, probably the, the Fed's going to start loosening the interest rates a little bit mid, mid next year, and the markets are going to start to respond pretty positively to that. Not only the housing market, because there's a shortage of housing, but also the, the commercial construction markets, which are a little slower right now than what we're actually seeing in the residential side. So I think, again, you know, us coming through a period like this with significant headwinds in both the Steel Pressure Pipe segment as well as the Precast segment, with the headwinds that we're seeing, and while, like I said, the quarter is disappointing, but we're still coming through this in decent shape for the headwinds that we're actually seeing. So we're pretty excited about the markets coming at us going forward. Yeah. Just my last question, it might be for Aaron. I mean, the cash conversion here this year has been pretty fantastic. You know, I guess I'm wondering if there's anything that's an anomaly in there and how we ought to think about that, you know, into 2024. Is this unusual or, you know, can you keep up this pace? Because, you know, you're gonna have a balance sheet flush with some cash and very little debt here pretty soon. Yeah. I think, you know, what I would say, Brent, is that we're performing better. I think we have a change of focus. Scott kind of mentions it a little bit here and there, 'cause it's a thing we're continuing to work on, and we're not where we want to be yet, but we're making progress on really trying to get customer prepayments, especially for steel, to put us in a little bit of a different working capital position on our jobs and really try to moderate the working capital needs of that Steel Pressure Pipe business. That has been a kind of a little bit of a pain point for the company in its history, and we acknowledge that, and we acknowledge that, that's something that we should strive to improve, and we're trying to do that. Now, I'm not saying that we haven't had a couple of good bounces in the course of this year too, that's kinda helped, especially in the Q1, when I think, you know, we saw just kind of a big... I think it was like $21 million of free cash, I think, in the Q1. So we've had a couple of good things, but, but I think all in all, we, we have a, a little bit of a shift kinda starting on, on some of the, the customer relationship stuff that's starting to pay some dividends for, for the business and its cash flows. Yeah, I think just to add a little bit to that, Brent, the you know, progress payments, like I said at the beginning, the market's starting to change a little bit, and obviously, we've been trying to drive that because of all the cash that we get tied up in current assets, especially with the Steel Pressure Pipe business. Progress payments are something that we're always looking at, getting paid for steel, especially in jobs that are long jobs, that we're having to buy steel to protect the steel price up front to make sure that we don't get sideways with steel pricing. And another area of big focus, especially across the company, but I think the guys on the Steel Pressure Pipe side have done a really good job of getting the AR on time up. I mean, and when you go back several years ago, I mean, we were seeing AR on time in the 40% range, and now we're seeing them in a lot of cases between 75% and 80% on time. So, so big change there, too. It's a big focus, right? Cash is, is important to us going forward to, to do the things that we wanna do as a company to grow the company, so. Very good. I'll pass it on. Thank you. Thank you. Thank you, Brent. Thank you. Our next question comes from the line of Julio Romero with Sidoti & Company. Please proceed with your question. Hey, good morning, Scott and Aaron. Hey, Julio. Good morning, Julio. Hey. Hey, morning. You guys mentioned earlier on, on the Precast side, that commercial construction has decreased, but residential has held up pretty well. Should we infer that to mean that you're seeing the ParkUSA product demand, kind of temper a little bit and, and Geneva hold up pretty well, and is that where some of the product mix challenges you mentioned earlier are stemming from? Yeah, that's right, Julio. I think that the interesting piece of this is, obviously, we're in two really good markets on the Precast side of the business, right? The state of Texas, obviously, is always building. They're always, you know, spending the cash they have generated from the energy-type business. Good, a really good market. Plus, Utah, the net migration into Utah has been pretty solid, and quite frankly, we've been, you know, actually a little bit surprised on how well the Precast infrastructure side of the business that we have at Geneva has held up, because of the pent-up demand, housing-wise, in the Utah market. So that's still kind of bumping along. And both of those, I would say, have only decreased modestly, but I think that probably the impact is a little bit more right now with the park side. But if you look at the Dodge Momentum Index and what's coming forward, you know, and the momentum index is, you know, it's basically non-residential projects going into planning. And it generally precedes spending in the non-residential market by about 12 months. And the September index was up about 3%, and while commercial was pretty flat, the institutional piece is gone up quite a bit, and the institutional piece is more public-facing. You know, and we've seen, like, the commercial fall off a little bit, but institutional, like educational, hospitals, things like that, is really kind of a strong point in the construction side. Right now, what they're projecting is if the interest rates start to maybe moderate a bit by the time we get to middle of the year, that we're probably expecting a pretty good commercial construction market next year, as well as, hopefully, a continued strength that we're seeing in the Precast infrastructure side. So these are just really off modestly. Like I said at the beginning, demand's a little bit lower, not high like it was in 2022. So we're seeing a little bit more pressure on pricing, but I wouldn't say it's across the board. It's on certain things, and the mixes have changed a little bit, like you said. But all in all, I think that market's holding up pretty well based on, you know, the interest rate environment that we've seen over the last, what, 11 interest rate hikes that the Fed has done. And we're pretty excited about the way that looks going forward, too, especially with the headwinds that have been in that business this year and how well it's still doing, so. Great. No, that, that's, that's really good color there. I appreciate it. And then maybe if, if you can speak to ERP a little bit, you know, did you call out how many days downtime you, you might have taken in the quarter and, and maybe how many you expect for next quarter? Yeah. Julio, what's happening is we're starting to see a better transactional integrity through the course of the business, mostly because we're just reinforcing process and, you know, managing our data, I think, a little bit better than we were initially, you know, say, a year ago at this time. We're obviously getting a lot of help from some consultants to kinda get us, you know, kinda pull through this a little bit, but we're eventually gonna get to a place where we're on MRP and have a little bit more automation. ... But I'd say, as far as, you know, some of the days that we've been spending on inventories, that's improved. We're still doing inventories. We're obviously getting better at them so that they're improving for that reason. But I would say that now we're getting to a point where going forward, we're especially at 2 of the 3 Park plants, we're at a stage where, due to the confidence that we have, that we're not even gonna, you know, have them do an inventory because 1 that still has a little bit of work to do, I think, a little bit more of a focus. But that's something that I think is gonna continue to improve for us going forward. So, I mean, I think to this point, Julio, to answer your question on the days, I would say we've probably spent 3 days a quarter since we probably bought the Park business. And I would say probably the year-ago quarter was maybe a little bit more because we were doing the first initial go live for ParkUSA. So we had to do a kind of an extra inventory at the launch. Got it. No, thank you for that, and sounds like, you know, you're making progress there for sure. And then just thinking about the share repurchase authorization, how should we kinda think about the cadence of you guys deploying that, when you balance that with maybe debt reduction and some other cash uses? Well, yeah, I think, Julio, the way we're looking at it is the board approved the $30 million, and we're new at this, right? So we'll probably begin to deploy maybe $10 million of that at a time just to start getting our feet wet of that. We're gonna continue to work down our debt as we go. Again, like you heard Brent ask the question about cash flow. We're pretty focused on cash flow so that we can get that debt down and ultimately to do the things that we need to do to drive shareholder value. And really, the repurchase program is a part of our growth strategy now, right? Because there's not always a M&A acquisition that's either readily available or practical, right? Because, you know, there's not always something where you want it, when you want it, and at the value you want it, right? So it's maybe not be regularly readily available. The other thing is, when you look at the market still, they're still relatively frothy as far as multiples in the markets, the things that we're looking at. So we are very sensitive to, you know, what we're trading at and making sure that we're doing things that are accretive to the shareholders if we're doing an acquisition. And in absence of being able to do one that makes any sense, to continue to drive shareholder value, which is part of our growth strategy, we may very well opt to do share repurchases, and that's why we put that into play. So, it's definitely debt repayment. We're not going to do anything with share repurchases that get us out of whack with our credit facility or puts us in a position where we can't do an acquisition when we find one that makes sense. So we're gonna be pretty careful with it. Great to hear. Thanks very much for taking the questions. Absolutely. Thank you. Our next question comes from the line of Ted Jackson with Northland Securities. Please proceed with your question. Thanks. Morning, Scott, Aaron. Good morning. Morning, Ted. Yeah. TGIF. Yes, TGIF. Yes. The main question I wanna ask is, going back into your commentary, Scott, you had made... Oh, and first of all, if there's actually a presentation for the quarter, I'm not sure it's on your website. When I go on your website, I see an August presentation. I think it hasn't been updated, but perhaps I'm wrong. I think it'll be updated. But then it- Yeah, I think it'll be updated soon. Oh, okay. Okay. Sorry about that. No, it's okay. You know, I mean, you know, I'm a mellow guy. In terms of questions, Scott, you had talked about a pickup in bidding activity for 2024, but because of the, you know, dearth of bidding activity, if you would, in 2023, more margin pressure, and I wanted to kinda unpack that a little bit on two fronts. You know, number one is, you know, I mean, you've had some, you know, nice margined business booked in your backlog that, you know, we're seeing the benefit of. So, you know, maybe you can talk about, you know, reference back to kind of what you see the impacting of your margin structure is from that. And then, you know, I mean, that's the negative side of this, but the fact of the matter is, is that the bidding activity for 2024 looks to be relatively robust. How does that play out in terms of your backlog as you roll through the year? And then can maybe some color with regards to kind of the drivers behind that bidding activity. I mean, is it, is it a result of some of the, you know, government funding coming into the market? Is it a, a regional thing, you know, based on states? Maybe some just, you know, some color around that. That's my first set of questions. To take the last one first, because I'm not sure I'm gonna remember all of those, Ted. I think that the IIJA funding, government funding, starts to take a little bit more hold as we go into next year, but really, probably the bigger part of that is out at least a couple of years, right? These are just projects that we're actually seeing coming through the system. You know, we're in our strategic planning process right now, and we're looking at everything that's coming through our project tracking system, the things that are likely to bid, the things that may not bid. And obviously, when we look at those things, we give the things that we don't think are that likely a pretty good haircut to come down, and we've come up with a number that's quite a bit bigger than what we saw in 2023. So that looks good, but that's not. I don't expect the IIJA funding really to start really kicking in until probably 2025. So that's really a ways out still. This is just stuff coming through, and I think the exciting thing about this, I think I said this before, Ted, that even with a really small market, and we've seen a couple pretty small markets over the last couple of years. 2021 was a market similar to this size that we're seeing this year. While the margins are not great, they're still okay coming through this period. If you look back several years ago when we had markets this size, before some of the market consolidation happened, the margins were really, really ugly. So that's a piece of the excitement that we have going forward, especially looking at bigger markets. So when you look at margins and how those things play, and I think this is a little bit of your first part of your question, you'll have to remind me about some of that. When you get lower bidding environments like we've seen this year and like we saw in 2021, what ends up happening is backlogs start to go down because there's less bidding and people putting less in their backlog. So it starts to become more of like, hey, there's, you know, there's starving animals there, and they're all after the piece of meat, right, at some point. So that creates some pressure on the margin. And we've seen some of that over the last few months, really since probably the last earnings call. That kind of pressures things down a little bit. A lot of the stuff that we have in backlog has really good margins. I think some of the things that create a little bit more margin pressure in specific periods of time is when you get something that moves out, like the thing that we talked about earlier, that moved out of the Q3 into the Q1 of 2024. You're scrambling to find something to put in there that may not have as good of a margin, and you have lower overhead absorption because of that, so it's a double whammy on your margins. So there's a whole bunch of factors that go into this. And, you know, really, you know, our production levels in the Q3 for Steel Pressure Pipe have been, you know, pretty small, right? And again, you know, even with them being that small and all the anomalies that we had, being able to come through a quarter like that with a margin that's just halfway decent is exciting and bodes well for how things look when the market starts to really get bigger. So okay, so you're gonna have to go back and remind me of the other pieces of your question. Well, it's more—it's more of a discussion than a question, and you've gotten into a lot of it. But if I take what you just, you know, kind of laid out to me and listen, is it fair to say that when you're talking about a lot of the bid activity, you know, that this isn't like... So you're saying this isn't big government project, this is more, you know, kinda smaller projects, and that the fact that you haven't had, you know, a big set of government projects, you just have a lot of people competing aggressively for this smaller business? Yeah. And that is when you talk about 24, is you're saying, you're talking about really kind of these smaller, not mega projects, but smaller kind of bread-and-butter pieces of business, that that's the activity that you're talking about. Yeah, and we're still seeing some bigger, bigger projects that are, that are on the website. In, in 2024, there's some big things out there. Mm-hmm. We're just seeing, you know, we're seeing more smaller ones. Generally, smaller ones don't get as much pressure as the bigger ones, and they are generally all municipality or utility-related. So in some way, shape, or form, government-sponsored, at least to some extent, whether it's state or federal funding that goes into those. But there's all kinds of different dynamics. But what I'll say is on the larger projects, Ted, those are the ones that generally get more attention and become more, what I would say, nationwide bidding attractions. The smaller projects are more regional attractions. So unless you have one region in the country that's really slow, those are generally a more reasonable bidding environment because they are smaller projects. But the big ones, the big ones attract more attention, for sure. Mm-hmm. Mm-hmm. Now, but I mean, and put it all together, it sounds like, you know, there's a pickup in activity. You have an even—and then you've got a longer-term drive with, you know, a lot of the infrastructure funding. And, you know, I guess the tone I'm reading is you're, you know, moving through the end of 2023 and into 2024, feeling pretty good about the current level of business, and then, you know, the longer-term demand for your services and products, you know, through 2024 and into 2025. Yeah, I think that's right. I think the reality is, Ted, that 2023 has been a small bidding year. 2022 was a bigger bidding year, probably maybe 30 or 35% more than 2023. 2021 was like 2023. So we've had three probably okay bidding years, or one okay bidding year in that time frame and two smaller ones, and we're still coming out the way we're coming out, and we're expecting bigger bidding years in 2024 and 2025, especially with the IIJA funding, which, you know, could add, you know, several thousand tons of business to your backlog during a period of time like that, depending on how these things come out. So-... We're pretty excited about how things look going forward on the Steel Pressure Pipe side with the markets that are coming at us. But I think I'd, you know, equally say we're excited about the Precast business as well, as that's had held up with the amount of headwinds that we've had this year. So I think those are both positive signs and really bode well for the business as we get back into stronger markets. Okay. Well, I'm gonna end and just say, you know, the free cash flow is the, what I care the most about, and I was, I'm very. You You know, I mean, I'm gonna point out that if you look at your year-to-date cash flow generation, you're almost at the same level you were in 2020. And, you know, we'll see what happens with the Q4, but, you know, it's great to see, you know, the success you're having in the business, and I look forward to, you know, seeing you continue to grow that free cash flow. Now I'll get out of line. Thanks. All right. Thanks, Ted. Thank you. Ladies and gentlemen, that concludes our question and answer session. I'll turn the floor back to Mr. Montross for any final comments. Yeah, I think I'd just like to say, I'd like to thank everybody again for joining us today. And obviously, we came into 2023 with a pretty high backlog, and we've maintained a pretty high backlog for the last several quarters. I think we're pretty steady with that going into 2024. I think we're well positioned to handle the significant opportunities coming up in the water transmission Steel Pressure Pipe business. And even though the Precast business is off its record highs that we saw in 2022, that still remains strong, and our long-term view about the Precast business remains unchanged. We are focused on growing in that business and growing that business in the relative near term to the similar size that we have our Steel Pressure Pipe business. I think the biggest thing, again, is to reiterate, you know, we've come through a year in 2023 that has had quite a bit of headwinds. Steel Pressure Pipe is a small market, and like I said before, you look back several years ago to markets that were this size, and the margin generation in those markets were really ugly. And even though this year is a little bit disappointing, or this quarter was a little bit disappointing, the margins aren't great, but they're, they're, they're significantly better than what we've seen in the past with markets this size. Which again, I think represents more of a market resiliency based on the current market configuration and due to the consolidation that we've had in that market, and it really bodes well for bigger markets. And I think it's the same thing for Precast. I mean, there's been a lot of headwinds there, interest rates, and it's off last year's record highs, but we're still bumping along pretty good in a business that also has a lot of headwinds. So we're really looking forward to these markets continuing to grow and expand as we go forward, and we appreciate everybody's time, and thank you, and we'll... I guess we'll talk to you in March. Is that it? March. So thank you. Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.