On December 19, 2023, Shimmick Corp (SHIM, Financial) released its 8-K filing, announcing its financial results for the third quarter ended September 29, 2023. The company, a leader in water infrastructure, reported a net income of $35 million, a significant increase from $18 million in the same period in 2022. Diluted earnings per share also saw a notable rise to $1.58, up from $0.82 in the prior year.
Financial Performance Overview
Shimmick Corp (SHIM, Financial) experienced a slight revenue decrease of 5% year-over-year, totaling $175 million for Q3 2023. This was primarily due to a decrease in revenue from legacy jobs awarded prior to the January 2, 2021 AECOM Sale Transactions. However, the company's strategic shift towards higher margin, lower risk jobs has paid off, with gross margin dollars reaching $17 million, or 10% of revenue, compared to 7% in the same period in 2022.
Adjusted net income for the quarter stood at $37 million, a 70% increase from the previous year, while adjusted diluted earnings per common share reached $1.67. Adjusted EBITDA also saw a significant boost, climbing to $42 million, a 63% increase from Q3 2022. The company's backlog remained robust at $1.2 billion as of September 29, 2023.
Strategic Initiatives and Market Position
CEO Steve Richards expressed satisfaction with the company's performance, attributing the success to Shimmick's ability to self-perform complex water projects and a strategic shift in job-bidding. Richards highlighted the company's transition to higher margin projects, which has been central to its profitability growth.
Shimmick has become more profitable, as evidenced by the year-over-year expansion of our gross margin in the third quarter of 260 basis points and increases in adjusted net income to $37 million, or 70%, and adjusted EBITDA to $42 million, or 63%, from the prior year quarter,"said Richards.
Shimmick Corp (SHIM, Financial) is recognized as a top builder in the water infrastructure sector, with a history of working on significant projects such as the largest wastewater recycling and purification system in California and the Hoover Dam. The company's expertise and strategic focus on high-margin projects position it well for continued growth and profitability.
Balance Sheet and Cash Flow Statements
The balance sheet as of September 29, 2023, shows total assets of $457.1 million, with current assets accounting for $270.7 million. The company's property, plant, and equipment net value stood at $50.1 million. Shimmick Corp (SHIM, Financial) reported total liabilities of $388.8 million, with current liabilities making up $297.2 million of that total.
From a cash flow perspective, net cash used in operating activities for the nine months ended September 29, 2023, was approximately $64.8 million. The company's investing activities provided a net cash inflow of $13.2 million, while financing activities contributed an additional $32.7 million in net cash.
Shimmick Corp (SHIM, Financial) continues to maintain a solid financial position, with a strong balance sheet and a healthy cash flow that supports its operational needs and strategic investments.
Value investors and potential GuruFocus.com members interested in the detailed financials and performance analysis of Shimmick Corp (SHIM, Financial) can find more information in the company's recent 8-K filing. The company's strategic focus on high-margin projects and its robust backlog suggest a positive outlook for future growth and profitability.
Explore the complete 8-K earnings release (here) from Shimmick Corp for further details.
