GLDD posts strong first quarter results

GLDD president and CEO Lasse Petterson: “Great Lakes had a great first quarter.”

Houston-headquartered Great Lakes Dredge & Dock Company [Nasdaq: GLDD] today reported financial results for the first quarter ended March 31, 2025.

“Great Lakes had a great first quarter, with strong project performance and high utilization as all of our active dredges were operational,” said GLDD president and CEO Lasse Petterson. “We ended the quarter with revenue of $242.9 million, net income of $33.4 million, and adjusted EBITDA of $60.1 million. Our substantial dredging backlog stood at approximately $1 billion as of the end of the first quarter, with an additional $265.3 million in low bids and options pending award, providing revenue visibility for the remainder of 2025 and well into 2026. Capital and coastal protection projects accounted for 95% of our backlog, which typically yield higher margins.”

“Dredging for the private companies in the liquefied natural gas (“LNG”) market is gaining momentum. As a result, post-quarter end, we received notice to proceed for dredging work on the Woodside Louisiana LNG project. This project will be included in our second quarter 2025 backlog along with two options that will be included in our second quarter 2025 options pending award. Dredging is expected to commence early 2026. Included in our current backlog are two other LNG projects awarded in 2023, the Port Arthur LNG Phase 1 Project and the Brownsville Ship Channel Project for the Next Decade Corporation’s Rio Grande LNG Project, the latter representing the largest project in the Company’s history. Dredging operations for both of these capital projects commenced in the third quarter of 2024 and are ongoing.

“In March, our board of directors approved a $50 million share repurchase program, as we believed our share price did not appropriately reflect the company’s financial performance and long-term outlook. As of April 30, 2025, we have repurchased 1.2 million shares under the program for a total spend of $10.4 million.

“In addition, on May 2, 2025, we executed an amendment to our revolving credit facility, increasing the size from $300 million to $330 million, further enhancing our liquidity. All other terms remained the same.

“We continue to make progress on our new build program with our newest hopper dredge, the Amelia Island, expected to be delivered in the third quarter of this year will immediately go to work when she leaves the shipyard. The Amelia Island and her sister ship, the Galveston Island, which was delivered in early 2024, will primarily work on projects aimed at the redevelopment and enhancement of our shorelines, which are consistently impacted by storms, and rising sea.

“The Acadia, the first U.S.-flagged Jones Act compliant subsea rock installation vessel is also currently under construction. The target markets for the Acadia include domestic and international offshore wind projects and projects that protect critical subsea infrastructure such as oil and gas pipelines and power and telecommunication cables.

“Following a strong 2024, the company started 2025 with outstanding momentum, delivering an exceptional first quarter. Driven by a modernized fleet, superior project execution, and a robust backlog, we believe that we are well positioned for the future.”

First Quarter 2025

Revenue was $242.9 million, an increase of $44.2 million from the first quarter of 2024, reports GLDD. The higher revenue in the first quarter of 2025 was due primarily to higher capital and coastal protection project revenue as compared to the same period in the first quarter last year, offset by lower maintenance project revenue.

Gross profit was $69.5 million, an improvement of $23.9 million compared to the gross profit from the first quarter of 2024 and gross margin percentage increased to 28.6% in the first quarter of 2025 from 22.9% in the first quarter of 2024 due to improved utilization and project performance.

Operating income was $49.9 million, which is up from $31.5 million in the prior year first quarter. The year over year increase is driven by higher gross profit partially offset by an increase in general and administrative expenses mostly from higher incentive compensation due to the higher current year first quarter results.

Net income for the quarter was $33.4 million, which is a $12.4 million increase compared to net income of $21.0 million in the prior year first quarter. The increase is mostly driven by improved operating results partially offset by an increase in income tax provision.

Market update

GLDD says that the Administration continues to demonstrate strong and consistent support for the dredging industry. The U.S. Army Corps of Engineers (the “Corps”) is operating in fiscal year 2025 under a continuing resolution, enacted on March 15, 2025, which sustains the funding levels established in the prior fiscal year’s record-setting budget through September 30, 2025. Our $1 billion project backlog and the inclusion of resources from the 2023 Disaster Relief Supplemental Appropriations should enable us to continue to deliver on a very busy 2025, with sustained execution capacity and expected project visibility extending well into 2026.

The Water Resources Development Act (“WRDA”) is reauthorized biannually and provides funding for the Corps’ projects focused on flood protection, dredging, and ecosystem restoration. WRDA 2022 authorized the projects for the deepening of shipping channels in New York and New Jersey to 55 feet, as well as for the Coastal Texas Protection and Restoration Program, which is designed to safeguard the Texas Gulf Coast from hurricanes. On January 4, 2025, WRDA 2024 was signed into law, authorizing numerous capital investments and initiatives aimed at enhancing flood protection, strengthening coastal resilience, and advancing ecosystem restoration efforts.

GLDD notes that, on April 16, 2025, the Bureau of Ocean Energy Management issued a temporary pause for Equinor’s Empire Wind I project which currently is included in GLDD’s offshore energy backlog.

“While the duration and impact of the temporary pause to the project are unknown at this time, we remain in regular contact with Equinor,” says GLDD.

“Recognizing early signs of potential delays to projects in the U.S. offshore wind market, we proactively expanded our strategic target markets for the Acadia to include oil and gas pipeline and power and telecommunications cable protection, as well as international offshore wind. These additional markets helped pave the way for the expansion of our offshore wind division into the broader range of offerings that we call Offshore Energy. This expansion is driven by our assessment of a global undersupply of rock placement vessels. Accordingly, we are actively pursuing opportunities across these sectors, which are anticipated to provide sustained utilization for the Acadia into the foreseeable future.”

• MORE