LMB

Limbach’s second quarter results were marked by revenue growth driven by recent acquisitions and robust bookings, but the company faced significant margin pressure and missed Wall Street’s expectations for both revenue and adjusted earnings. CEO Michael McCann attributed the underperformance to project timing and ongoing softness in institutional and healthcare markets, noting that elevated price sensitivity and competitive cost pressures weighed on gross profitability. He acknowledged that “underlying customer demands remained healthy,” yet cautioned that the company is operating in a challenging environment for its largest verticals. Is now the time to buy LMB? Find out in our full research report (it’s free). Revenue: $173.5 million vs analyst estimates of $177.3 million (21.9% year-on-year growth, 2.1% miss) Adjusted EPS: $0.64 vs analyst expectations of $0.93 (30.9% miss) Adjusted EBITDA: $13.94 million vs analyst estimates of $19.6 million (8% margin, 28.9% miss) The company lifted its revenue guidance for the full year to $775 million at the midpoint from $745 million, a 4% increase EBITDA guidance for the full year is $81 million at the midpoint, below analyst estimates of $91.45 million Operating Margin: 4.3%, down from 8% in the same quarter last year Market Capitalization: $552.5 million While we enjoy listening to the management’s commentary, our favorite part of earnings calls is the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention. Chris Moore (CJS Securities) asked about healthcare and industrial market pressures impacting ODR organic revenue growth; CEO Michael McCann pointed to strong bookings as a positive offset but admitted price sensitivity continues to weigh on these segments. Tomo Sano (JPMorgan) probed for more detail on the strategic rationale and expected margin impact of the Simpcore acquisition; McCann explained that early customer engagement in data center projects offers significant pull-through revenue and higher-margin professional services potential. Gerard Sweeney (ROTH Capital) inquired about the timeline for realizing cross-selling benefits from Simpcore; McCann responded that opportunities may materialize quickly due to Simpcore’s early project involvement, but full benefits depend on Limbach’s ability to capitalize on these touchpoints. Robert Brown (Lake Street Capital) pressed for clarification on when margin improvements from integration efforts would be realized; McCann indicated that margin gains are targeted over the next two to three years, with immediate focus on operational adjustments and cost absorption. Brian Brophy (Stifel) asked about Simpcore’s growth trajectory and staffing constraints; McCann acknowledged that Simpcore’s growth has been limited by recruiting challenges, which Limbach aims to address by adding resources to capture high-margin project opportunities. As we look ahead, StockStory’s analysts will watch (1) the pace at which Limbach integrates Simpcore and realizes cross-selling in the data center sector, (2) progress on operational improvements and gross margin recovery at Pioneer Power and other recent acquisitions, and (3) signs of stabilization or renewed strength in healthcare and institutional markets. Execution on market diversification and early engagement in high-growth sectors will be critical to Limbach’s trajectory. Limbach currently trades at $46.65, down from $77.11 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free for active Edge members). ONE MORE THING: Top 5 Growth Stocks. The biggest stock winners almost always had one thing in common before they ran. Revenue growing like crazy. Meta. CrowdStrike. Broadcom. Our AI flagged all three. They returned 315%, 314%, and 455%, respectively. Find out which 5 stocks it’s flagging this month — FREE. Get Our Top 5 Growth Stocks for Free HERE. Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.

Image source: The Motley Fool. Wednesday, Aug. 5, 2026 at 9:00 a.m. ET President and Chief Executive Officer - Michael McCann Executive Vice President and Chief Financial Officer - Jayme L. Brooks Operator: Good morning. Welcome to the Limbach Holdings Second Quarter 26 Earnings Conference Call and Webcast. All participants will be in listen-only mode. I will now turn the conference over to your host, Lisa Fortuna of Financial Profiles. You may begin. Lisa Fortuna: Good morning, and thank you for joining us today. To discuss Limbach Holdings financial results for the second quarter of 2026. Yesterday, Limbach issued its earnings release and filed its Form 10 Q for the period ended 06/30/2026. Both documents as well as the updated investor presentation are available on the Investor Relations section of the company's website at limbachinc.com. Management may refer to select slides during today's call and encourages investors to review the presentation in its entirety. On today's call are Michael McCann, President and Chief Executive Officer and Jayme L. Brooks, Executive Vice President and Chief Financial Officer. We will begin with prepared remarks and then open the call to questions. Before we begin, I would like to remind you that today's comments will include forward looking statements under federal securities laws. Forward looking statements are identified by words such as will, be, intend, believe, expect, anticipate, or other comparable words and phrases. Statements that are not historical facts, such as those about expected financial performance, are also forward looking statements. Actual results may differ materially from those contemplated by such forward looking statements. A discussion of the factors that could cause a material difference in the company's results compared to these forward looking statements is contained in Limbach's SEC filings Including reports on Form 10 ks and 10 Q. Please note on today's call, we will be referring to some non GAAP measures. You can find the reconciliation of these non GAAP measures to the most directly comparable GAAP measures our second quarter 2026 earnings release and in our presentation, both of which can be found on Limbach's Investor Relations website and have been furnished in the Form 8 ks filed with the SEC. Michael McCann: With that, I will now turn the call over to President and CEO, Mike McCann. Good morning and thank you for joining us. Yesterday, we reported our second quarter results, as well as the acquisition of Simpcore. Our results fell short of expectations driven by project timing and ongoing softness in health and institutional markets from elevated price sensitivity and market conditions pressuring gross margins. However, underlying customer demands remained healthy. We generated $182 million of bookings during the quarter, our third consecutive quarter of strong bookings bringing the total bookings over the past 3 quarters $616 million While these market conditions have created near term pressure, they also underscore the importance of building a more diversified, higher-quality business, and we are taking action. Our focus is diversifying our end markets, expanding our geographic reach and leveraging our integrated platform in an effort to improve profitability. Moving on to strategy. For the past 5 years, we transformed Limbach. Today, that work allows us to shift from transformation to disciplined growth. Our objective now is to build a larger company with strong cash generation and higher returns over time. First, we are accelerating our efforts for expansion of data centers and industrial manufacturing. Building a national platform that mirrors the success we have achieved in our national healthcare platform. By diversifying our exposure across multiple attractive end markets, we believe we will reduce our reliance on any single vertical better balance the business through market cycles, and create a more resilient platform for long term growth. Second, we continue to pursue a disciplined acquisition strategy that expands our presence in targeted vertical markets, while extending our reach into attractive high growth regions such as Texas, The Midwest, and the Southeast. By broadening both our market and geographic exposure, we believe we are able to support customers across more locations. Reducing concentration risk and strengthening our competitive position. Additionally, our acquisition philosophy is not built around buying fully optimized businesses. We are looking for companies with strong customer relationships and attractive strategic positions where we believe Limbach's integrated operating model can create additional value over time. We have already seen that approach produce positive results with Pioneer Power, we have seen encouraging improvements in gross margin, approximately 1.5% from the first half of 2026 compared to when we acquired Pioneer Power in July 2025. We believe each acquisition strengthens the economics of the entire platform, because it expands customer relationships, increases cross selling opportunities, broadens our geographic reach, enhances the value of our integrated operating model. Third, we are leveraging our integrated operating model to connect capabilities across geographies and service lines. Accelerating cross selling opportunities and improving profitability. We believe our work at Pioneer Power demonstrates how disciplined integration, and operational improvements can create meaningful value over time, as we just noted. This integrated operating model also drives value creation from our acquisitions. For example, our target operational and pricing actions are of underway in an effort to improve Pioneer Power's profitability, bring gross profit margin in line with the company average over the next 2 to 3 years. We have a clear roadmap to improve results, By executing this plan, we expect to build a more resilient business with a broader set of growth drivers and less exposure to any single market, and higher margins. Execution of these strategic initiatives expands our national footprint, strengthens customer relationships, increases the scale advantages of our platform. It should strengthen our purchasing power, national account capabilities, operating leverage and our ability to allocate capital efficiently. We believe these advantages will compound over time, creating a larger, high quality business with more durable earnings and a stronger long term shareholder value. Importantly, our balance sheet and liquidity provides us with the flexibility to execute this strategy in a disciplined manner. Yesterday's acquisition of Simpcore is an excellent example of our disciplined approach to capital allocation, and drives 3 of our strategic initiatives I have been describing. This acquisition expands Limbach's geographic footprint, enhances its ability to serve national and multisite data center customers and increases engagement with building owners early in the facility lifecycle. Equally important, with our integrated operating model, it creates significant cross selling and pull through project booking opportunities by connecting complementary service offerings across both organizations expanding access to new data center customers and generating additional growth within Limbach's existing markets. Through its national program management services, Simpcore currently oversees project budgets for customers that have a cumulative value exceeding $8 billion. We believe this early engagement with customers will create meaningful opportunities for Limbach to provide engineering, construction, commissioning, maintenance and other life cycle services. We have confidence in the acquisition of Simpcore as its business model closely mirrors Limbach's proven healthcare program management platform. Which we expect will provide us the ability to drive value in the data center mission critical market. Over the last 12 months, our healthcare program management platform generated approximately $3 million of professional service revenue, and pulled through approximately $60 million of project bookings, resulting in a 20x pull through multiple. Looking forward, we currently expect Simpcore to generate $12 million of program management revenue, and $4 million of adjusted EBITDA in 2027. Moving on to our verticals. Healthcare, while at a macro level, healthcare spending remains pressured by budget constraints, delayed decision making, continue to strengthen our position by engaging earlier with national customers our facility planning and long term travel programs. Those relationships continue to generate larger, more strategic opportunities over time. Industrial, the demand in our industrial markets remains strong and increasingly complements our data center strategy. As both are benefiting from sustained investment in power, manufacturing and mission critical infrastructure. Lastly, data centers. We continue to view data centers as an attractive long term growth opportunity, We are steadily investing in the capabilities, customer relationships and professional services platform necessary to establish Limbach as a trusted long term partner. Before I turn the call over to Jayme, let me close by putting today's results into a broader context of where we are taking Limbach. Despite our near term challenges, we remain confident in Limbach's long term direction and our ability to generate shareholder value. We believe the actions we are taking from investing in our national platform to expanding our capabilities through disciplined acquisitions like Simpcore are building a stronger, more diversified, higher-quality company with greater long term earnings power. Our strategy is straightforward. Broaden our geographic reach, deepen customer relationships, expand into attractive end markets, and leverage our integrated operating model to create a business that generates higher returns and compounds value over time. We have adjusted our expectations to reflect the business environment as we see it today. We believe our responsibility is straightforward: execute against the plan, continue allocating capital with discipline, and build a business that is stronger, more valuable. We understand that execution is 1 of our important measures of success We are focused on providing continued and better executions. With that, I will turn the call over to Jayme to review our financial results and updated outlook. Jayme L. Brooks: Thank you, Mike. Our Form 10 Q and earnings press release filed yesterday provides comprehensive details of our financial results. So I will focus on the highlights of the second quarter of 2026, with all comparisons versus the second quarter of 25 unless otherwise noted. We generated total revenue of $173.5 million compared to $142.2 million in Q2 25. The increase was primarily due to the $30.9 million revenue contribution from Pioneer Power. ODR revenue grew 17.9% to $128.4 million with ODR acquisition related revenue increasing 21.3% partially offset by a 3.4% decrease in ODR organic revenue. ODR revenue accounted for 74% of total revenue during the quarter. GCR revenue increased 35.3% to $45 million with acquisition related revenue increasing 23.3% organic revenue increasing 12%. Total gross profit decreased 6.4% from $39.8 million to $37.3 million. Total gross margin was 21.5%, down from 28% in the prior year quarter. ODR gross profit decreased 2.6% or $800 thousand and ODR gross margin was 24%. Compared to 29% in the prior year period. GCR gross profit decreased 20.7% or $1.7 million and GCR gross margin was 14.5% from 24.7%. The decrease in both segment gross margin percentages was primarily driven by the current lower margin profile of Pioneer Power. Pioneer Power continues to perform in line with the company's integration expectations, and management expects gross margins to improve as 2026 progresses. Operational and pricing improvement initiatives are underway to enhance profitability at Pioneer Power. With the goal of bringing gross margins in line with the company average over the next 2 to 3 years. Gross profit margin was also negatively impacted by lower net project write ups compared to the prior year period and competition for skilled labor and materials associated with construction activity in the data center markets. SG&A expense for the second quarter was $28.1 million, an increase of approximately $1.5 million from $26.6 million. The increase was primarily driven by incremental SG&A expense associated with Pioneer Power and an aggregate $600 thousand increase in total stock based compensation and payroll related expenses. As a percentage of revenue, SG&A expense decreased to 16.2% from 18.7% in the second quarter of 25. Net income for the second quarter decreased 38.8% from $7.8 million to $4.7 million, and earnings per diluted share was $0.39 compared to $0.64 Adjusted net income decreased 32.1% to $7.6 million compared to $11.3 million and adjusted diluted earnings per share decreased from $0.93 to $0.64 Adjusted EBITDA for the quarter decreased 22.3% to $13.9 million compared to $17.9 million Adjusted EBITDA margin was 8% compared to 12.6% in Q2 last year. Primarily driven by the lower gross profit and higher SG&A expense. Turning to cash flow, Net operating cash inflow during the quarter was $18.7 million representing our second highest second quarter operating cash flow since becoming a public company. This compares to $2 million in the year ago period and was driven by net income of $4.7 million, $9.6 million of non-cash adjustments of non-cash adjustments and a $4.4 million increase from working capital. Free cash flow, defined as cash flow from operating activities, excluding changes in working capital, minus capital expenditures, was $13.7 million in the second quarter compared to $16.1 million in Q2 last year. Representing a $2.4 million decrease. This free cash flow conversion of adjusted EBITDA for the quarter was 98.2% versus 89.7% last year. Turning to our balance sheet. As of June 30, we had $17.5 million in cash and cash equivalents. And total debt of $41.1 million which includes $17.5 million borrowed on our revolving credit facility. Total liquidity, defined as cash and availability on our revolving credit facility, was $93.1 million at the end of the second quarter and on 07/24/2026, the company amended its credit agreement to increase the aggregate principal amount of available borrowings under its revolving credit facility from $100 million to $125 million providing an additional $25 million in potential availability. As Mike mentioned, yesterday, the company completed its acquisition of Simpcore. For a purchase price of $30 million subject to typical post closing adjustments. The acquisition was funded through a combination of available cash and borrowing under our revolving credit facility. Since the acquisition occurred after the end of the second quarter, the balance sheet as of 06/30/2026, does not include the funding impact of Simpcore. Moving to our outlook Our revised outlook is based on our strong bookings projects currently underway and the visibility we have into the balance of the year, and we believe it appropriately reflects the current operating environment and positions us to execute successfully. Accordingly, we have increased our revenue outlook to reflect the timing of project commencements and execution during the remainder of 2026, while lowering our adjusted EBITDA range to reflect the near term margin and execution headwinds Mike described earlier. This revised guidance excludes any contribution from the recently completed Simpcore acquisition or future acquisitions. For fiscal 2026, we now expect revenue of $760 million to $790 million and adjusted EBITDA of $78 million to $84 million Our outlook is based on the following operating assumptions. Total organic revenue growth of 9% to 14% ODR revenue as a percentage of total revenue of 70% to 80% ODR organic revenue growth of 6% to 10% gross margin percentage of 23% to 24% and SG&A expense as a percentage of total revenue of 15% to 16% Importantly, our expectations for cash generation remain unchanged. We continue to expect to convert at least 75% of adjusted EBITDA into free cash flow through disciplined working capital management for fiscal 2026 and expect CapEx to have a run rate of approximately $5 million This concludes our prepared remarks. Operator: I will now ask the operator to begin the Q&A. Thank you. Ladies and gentlemen, we will now begin the question and answer session. Please press star followed by the number 2. The first question comes from Christopher Moore with CJS Securities. Please go ahead. Chris Moore: So maybe we will just start with -- good morning. With the ODR organic revenue guide, so you stated, Mike, basically some softness in the healthcare market. Is it project timing? Is it kind of can you get into it a little bit deeper in terms of the lower revenue growth that you are thinking about for 2026? And does that carry over into 2027? Just trying to understand kind of how you are seeing the health care industrial side of things at this point. Michael McCann: Yes. So what kind of gives us confidence from a guidance perspective, just from an ODR organic, but, a total organic is our strong bookings that we have had over the last 3 quarters. So we have had $616 million in Q4, Q1 and Q2. So that gives us some confidence So for us, we continue to generate healthy bookings. I think each vertical market is a little bit different as far as a price sensitivity perspective as well too. Institutional health care, these several markets are challenged. We are still gaining market share and picking up bookings. But again, the price sensitivity of that is definitely impacted as well too. But as far as just from a guidance perspective, whether that is ODR or total revenue, the bookings is the biggest thing that gives us confidence. And we hope to continue the momentum from those bookings that leads us into kind of getting off to a strong start next year too. Chris Moore: Got it. Okay. I will leave that 1 there. The GCR margin had been pretty strong as you kind of more and more look to avoid the lower margin third party work. it is pretty low this quarter. I know there is was project timing, the Pioneer work. Is there something more strategic in temporarily taking on the data center work even if it is a third party data center work, even if it is lower margin to help you kind of gain further expertise in that vertical that would seem to fit with the Simpcore acquisition? Michael McCann: Yes. there is a couple of things going on, I think, with the GCR margin. We had a pretty low point at the end of Q2 from a backlog perspective, from a GCR perspective. And we have been rebuilding Obviously, we are still pointed significantly towards owner direct concentration. But regardless, our model has some GCR that is a part of that. So it really comes down to at the end of 2025, we have finished up a lot of work. And then we have started to rebuild from a sales and backlog perspective, and that obviously affects the timing. And that is why, ultimately, it is a you know, it was 14.5% in Q2 more than anything. I would say that is really predominantly from a timing perspective. Now I would tell you I think diversity is really important to us. You know, we are heavily weighted towards institutional, industrial, markets. Our ability to tap penetration with the data center market, helps us any number of different ways. We are I would say we are under indexed from a data center perspective. And once we can increase that percentage, I think that will help not only revenue growth, but also help margins as well too and help us absorb fixed costs. Chris Moore: Got it. And maybe just my last 1, kind of more big picture. Just how are you looking at 2026? Is it kind of a 2026 versus 2027? Is 2026 a full reset from an EBITDA perspective, a partial reset no reset at all? Just trying to kind of understand what is happening here. How that would translate into how everybody's been thinking about 2027? Michael McCann: Yeah. I definitely think from what we knew, we felt like we had to reset from a guidance perspective. Even though revenue is up, GP is down. And again, that is-- part of that is timing. As well as price sensitivity. So from a 2027 perspective, you know, we are looking to make sure that our model is built upon and is resilient. And I think there is 3 core things that we are looking at. Vertical market diversity, which we touched upon a little bit from a data center perspective, geographic expansion, we want to continue to acquire really good companies. And then really emphasize our operating model. How can we operate efficiently together? Through all of our locations? So we think it is a reset. We think going into next year that we are making adjustments that we need to be really sure that we have a super resilient model as we go into next year. Chris Moore: Got it. I appreciate it. I will leave it there. Thank you. Operator: Tomohiko Sano with JPMorgan. Please go ahead. Tomo Sano: Hi, good morning, everyone. Thank you for taking my questions. Could you give us more color on healthcare institutions environment, it is especially on the gaining market share versus pricing sensitivity you talked about, Mike, So how should we look at that environment and the key strategic initiatives in the back half and in 2027, please? Michael McCann: Yeah. Absolutely. So it is still a challenged environment for sure. You know, they are still impacted by things that happen from a policy perspective in 2025. You know, we are trying I think they are trying to navigate what the new normal looks like for them. it is our job to guide them to ultimately make the right decision. So the other thing that they are also impacted is what happens is if there is data activity in the market, that causes overall construction inflation and makes the cost of what they have to do even more challenging as well too. For us, I actually think vertical market diversity for us will not only help Limbach, but also helps from the perspective of some of our other clients as well too. So, you know, we are not looking at a dramatic change I think over time, they will be able to adapt and then we want to be there with them to adapt as well. So we spent a lot of time from you know, investing in on-site account managers, which those are spread against all of our vertical markets. As well as our customers, but it is certainly we found that model most impactful from a healthcare perspective. For us, it is a great long term market. Sometimes, you know, it is not the market that the data center is, but it is really important for us to balance as well too. So we still really believe in it. Just helping our customers navigate kind of short term and continue to stick with them as well too. Tomo Sano: Thank you, Mike. And on data center work beyond mix and growth opportunities, could you provide more color and details on gross margin profiles and key costs, overrun risks? And the contract structure mix, please? Thank you. Michael McCann: Yeah. Absolutely. So as we talked about from a health care perspective, institutional customer is very cost driven. The data center cares about its time and schedule. So they will pay up for somebody who is gonna move really quickly And, in some sense, that is our opportunity as I look at really in 2027. I think the acquisition of Simpcore is really important to kind of jump-start us from a data center perspective. If we are able to provide the solutions, which is speed to market, There will be opportunities for us from a margin perspective as well too. But that is why, again, I think Simpcore is really important to kind of use that as a jumping off point. We have made some progress around the last several quarters. We have talked about various fabrication projects. But a lot of times those projects we would be in a little bit later. Versus you know, from a professional service perspective, we are way earlier in the process in our ability to influence and use our customer solutions, I think, is going to be super impactful. Tomo Sano: Thank you. And if I may squeeze the last 1, Mike and Simpcore, acquisitions, could you talk about more opportunities for both growth as well as the margin profiles and then how you manage the execution risk with the Pioneer integrations as well? Thank you. Michael McCann: Okay. Yeah. So Simpcore-- you know, we have had some success with our health care program management platform. We started that organically. About 4 or 5 years ago. It took a long time. We have seen a lot of success about $3 million professional services revenue is pulled has been pulling through about $60 million of project booking. So it is big time multiple. From a pull through perspective. And we have seen our ability to influence early. And we could have started that organically from a data center perspective, but we saw a great opportunity from a Simpcore perspective of not only getting a very solid business that does not have the execution risk that a contractor would as well as the opportunity for pull through in a very hot market. So those combination of factors were not only excited about the earnings that will get our professional services revenue, but the potential for pull-through is definitely there as well too. I think the other question was Pioneer Power. They are performing as we expected. In the prepared remarks, talked about their margin being 150 basis points improvement. When we purchased them. So I have always pointed people to the Jake Marshall example that we have in our Investor Day. It takes time, especially the first year or 2. So it is on track. And we are looking for ways to improve and kind of following our model that we have done with the other acquisitions as well too. Thank you. I appreciate the color. Thank you. Operator: Gerard Sweeney with ROTH Capital. Please go ahead. Gerard Sweeney: Good morning, Mike and Jayme. Thanks for taking my call. Just wanted to dig in a little bit more with Simpcore. Wanted to understand when they are brought into a project how much visibility they have and their ability to maybe, you know, bring Limbach services into that equation. And how long would it take to sort of translate some of that professional services revenue toward into additional services for Limbach. Michael McCann: Absolutely. So they are in very early. Sometimes they are out there from a real estate perspective of just helping the customer plan super early. Data center customers go to Simpcore. A lot of it comes down to their ability to manage the budget for them, cost controls, understanding what the right long term outcome. And a lot of times that is from doing multiple projects with the same customer as well too. So there is so many aspects of visibility we will get from this. And the 1 thing we learned in the healthcare side, what is really important is the ability to understand where value can be driven through the process, and help people purchase as well too. So we are still-- you know, a data center, we are not where we need to be from a health care perspective. And the data center gives us insight of where we are able to add from a value train process as well too. So for us, way that we approach it is going to be very similar to health care. there is probably going to be some immediate opportunities. I think the fact that the data center is exploding right now from a demand perspective we will look at things like fabrication, procurement, and the opportunity to perform projects. After a building is completed, there is a lot of opportunity for service, maintenance, and retrofit projects as well too. You know, so it is up to us. The opportunity is there. it is just for us basically to capitalize on, and that is ultimately gonna drive the-- it is going to drive kind of when the pull through starts as well too. But very excited about it, and we think it is the right thing to do as far as kind of being the linchpin to really kicking off our data center vertical market. Gerard Sweeney: Is Simpcore geographically concentrated in the Texas area or do they have projects all over? Michael McCann: So what is nice is they have presence in Dallas, Fort Worth, other parts of Texas, Atlanta, Charlotte, Virginia, Northern Virginia, Richmond area, which is nice because some of those areas are areas that we do not have presence in right now. So it allows us to get a look into a market and that may eventually be an opportunity for us from an acquisition perspective for a contractor down the line. And then of course, they are dealing with contractors, not only general contractors, but mechanical electrical contractors. So that is 1 thing that is really attractive is they get us into markets that we are not in. And of course, the markets that are in are very good markets. So it gets us a look and we are definitely going to try to find synergies from that perspective as well too. The biggest thing for us, I mean, we can pull through work by not being in the market. We can do that from fabrication and specialty work. But it is going to give us an avenue to figure out what other geographic expansion we want to do and connect the dots and that is going to be the ultimate pull-through opportunity. Gerard Sweeney: that is fair. I get that. And then ODR, healthcare and ODR end markets, obviously, sounded like there is some pressure on that front on spending. As well as some costs. How do you recapture that those margins? Is this a pricing game? And at some point, do the healthcare companies, have to absorb these costs. Michael McCann: Yeah. So there is a couple things. I mean, I think they always have to absorb what is happening. And I know some of the stuff that happens is almost 12 months old, but, you know, those customers are very methodical at the end of the day. They are not going to make they are not going to completely change the way they purchase. It just takes time ultimately. For us, you know, the biggest thing for us is to help them look at things differently. And really, you know, I would say the last 12 months is very different for them as well too. You know, how they are gonna bundle projects, how they are going to look at, you know, what across their portfolio, what, what assets or hospitals are making money and some are not. So it is really the long term planning. The other thing that helps, obviously, is if we have fixed cost absorption by going into other vertical markets, that will also help the cost as well from some of these customers as well too. So if we are very dependent on the institutional, it causes some challenges as well too. So I do not think there is a secret button or a magic, you know, it is something that is really going to change healthcare. I think it is our ability to stick with them. Find avenues, drive value. that is what is been successful for us for the long term. And I think that is going to drive opportunities for us. And we want to stick with these customers as well too. I think that is important and we know in the long term it is going to work out. Gerard Sweeney: Okay. I appreciate it. Thanks a lot. Thank you. Operator: Robert Brown with Lake Street Capital. Please go ahead. Robert Brown: Good morning. Just wanted to follow-up a little bit on the margin question about some of the things you are doing. But how long does that take to kind of cycle through? And is this something that you can see improvement in 27 or what is the duration of the margin improvement? Yes. Thanks, Robert. Michael McCann: So there are a couple of things. Obviously, timing and that really comes back to us as, you know, the sales position that we the lack of sales that we had in the middle of last year. So that we will perform the way we have performed in the past, and we deliver. You know, we are looking forward to potential margin opportunities as we go into 2017, just based on the book of business that we have now. I think the other opportunity is diversifying ourselves into vertical markets where there is greater spend in high growth markets. And I think when I say vertical markets, I mean vertical markets from data center or other high growth drivers, but also from a geographic expansion as well too. Not every market is treated the same at this point. So the combination of those 2 factors we are making adjustments in order to make sure that in 2027, we are looking for an increased opportunity. Okay. Thank you. Robert Brown: And then on the Simpcore pull through in the data center market, is that something that takes projects moving quickly in that market, I understand. But how long does that take to kind of work through the system and just a sense of how Simpcore kind of works on the timing aspect? Michael McCann: So we have, you know, we have been working-- you know, we are we are currently working with program managers that are not Limbach right now in the data center. So we have some experience. And ultimately, I think what is going to happen is we wanna make sure that we are understanding and learning their customers. And the nice thing about this is they are bringing new customers to the table as well too, which kind of is additive to some of the customers that we have had. So, it is going to take a little bit of time but I think if we are doing our job correctly, there is gonna be an opportunity we are able to just fill a gap for them. Our ability to influence early. So we do not have an exact timing per se, But I can tell you yesterday, we have obviously, we announced that we were doing the deal. But it is-- we are going to immediately look for pull through. We are not gonna wait per se. We are probably going to be talking to people in the next few days and trying to find some opportunities as well too. So we are opportunistic about it. Obviously, it will take a little bit of time. All right. Robert Brown: Thank you. I will turn it over. Operator: Brian Brophy with Stifel. Please go ahead. Analyst: Yes, thanks. Good morning. Appreciate taking the question. You give us a sense for how fast Simpcore has been growing? Michael McCann: So they have pretty steady from an earnings perspective. And the biggest thing for us and they have been working really in the data centers, I would tell you, the last 4 or 5 years. The challenge for them is responding to the demand. And a lot of that comes down to recruiting staff. So that is 1 thing they are excited about with us is, you know, their ability to add immediately add staff. it is not something that you know, as we talk to them through a diligence process, I mean, we would love to add people right now. So that is been the biggest and that is, of course, the challenge when you are a smaller company is you are so busy responding to your customers that the recruiting process takes time. So that is been probably the bigger holdup to even seeing more growth. We like the fact that they were steady. But at the same time, we are gonna be immediately looking for staff to add their team to drive good quality, high gross margin revenue. Understood. that is helpful. And then, circling back to GCR gross margins, for a minute. Obviously, it was a little bit of disappointment. But were there 1 or 2 projects in particular that drove the lower gross margin, or is it more broad based than that? Thanks. It really was not execution it is project starting more than anything. So, I mean, we have had pretty steady execution. Through the first half of the year. it is more just project starting. As I touched upon before, our GCR backlog was $99 million. It was only $99 million at the end of Q3 and we have built that back up to 200 basically double at this point. And just project starting ultimately more than anything. So again, we are we are anticipating our opportunity within GCR margins. For us, it is really a timing perspective. We perform the way we performed in the past. We think there is a lot of opportunity. Think for 2026, the challenge is going to be what happens if that opportunity shows up into 2027. And that is 1 of the reasons we kind of adjusted our expectations and our guidance to make sure to reflect that. And timing could be a little bit of a challenge, but definitely not an execution issue. Understood. And then, I guess, bigger picture with GCR, now back to more of a growth mode, how are you thinking about the long term mix between the 2 segments? Yes, we updated our guidance to be 70 from 75% to 80% to 70% to 80%. We always look at our model as more owner direct driven. I think we are just, you know, we are trying to find the right mix. Balance. And I think that is the biggest thing as we go forward. And I think that affects obviously what verticals we are talking to. So just looking for that mixed stabilization. And that is why we felt like going from, you know, 75 to 80 to 70 is not a huge change, but that is the right kind of, mix at this point. Understood. Appreciate it. Thank you. Operator: A follow-up from Christopher Moore with CJS Securities. Please go ahead. Chris Moore: Yes. Just 1 question on bookings. It sounds like 3 straight quarters of good bookings. I know that calendar Q3 last year was the challenge and that is what created the soft Q1 2026. You are only a month into Q3 so far. Any thoughts in terms of July? And when did things kind of go soft last year in Q3 Was it later in the quarter? Or just trying to get a sense of visibility for Q3 bookings? Michael McCann: Yes. I think Q3 last year was a little bit different than what we have seen in the past. And that was really a culmination of ultimately policies hitting higher ed, health care, even from a manufacturing standpoint as well too. So those factors kind of led into our customers kind of into this compression mode as they really entered Q3. So it was kind of a unique period of time. We have looked at the last 3 quarters of kind of getting to that steady pace and that is what we are looking for kind of as we close out the year. Chris Moore: Appreciate it. I will leave it there. Thank you. Operator: We have no further questions. I will turn the call back over to Mike McCann for closing comments. Michael McCann: Our conviction in the long term direction of Limbach has not changed. We have reset expectations to reflect where the business stands today. And are focused on executing from here. We have a clear road map that will build an even more resilient business centered around vertical diversification, geographic expansion, and an integrated operating model. These 3 strategic objectives will build enterprise scale that will accelerate growth, expand margins and drive additional shareholder value. Thank you, everyone, for your interest in Limbach. Operator: Ladies and gentlemen, this concludes your conference call for today. We thank you for participating, and we ask that you please disconnect your lines. Before you buy stock in Limbach, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Limbach wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends Limbach. The Motley Fool has a disclosure policy. Limbach Holdings (LMB) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Management is transitioning the company from a five-year transformation phase to a period of disciplined growth focused on building a larger, high-margin platform. Second-quarter results fell short of expectations due to project timing delays and ongoing softness in the healthcare and institutional markets. Healthcare sector performance is being pressured by budget constraints, delayed decision-making, and elevated price sensitivity following 2025 policy changes. The company is actively diversifying its end markets to reduce reliance on any single vertical, specifically targeting data centers and industrial manufacturing. Gross margins were negatively impacted by the lower margin profile of the Pioneer Power acquisition and increased competition for skilled labor in data center hubs. The integrated operating model is being leveraged to improve the profitability of acquired businesses, evidenced by a 1.5% margin improvement at Pioneer Power since July 2025. Strong bookings of $616 million over the last three quarters provide management with confidence in underlying customer demand despite near-term execution headwinds. Revised 2026 guidance reflects increased revenue expectations due to project timing but lowered adjusted EBITDA to account for near-term margin pressures. Management expects to bring Pioneer Power's gross margins in line with the company average over the next two to three years through pricing and operational actions. The Simpcore acquisition is expected to generate $12 million in program management revenue and $4 million in adjusted EBITDA by 2027. The company maintains its commitment to high cash conversion, targeting at least 75% of adjusted EBITDA into free cash flow for fiscal 2026. Strategic focus for 2027 centers on vertical market diversity, geographic expansion into high-growth regions like Texas and the Midwest, and operational efficiency. Completed the $30 million acquisition of Simpcore to jump-start the data center vertical and gain early-stage engagement with facility owners. The Simpcore model mirrors the successful healthcare program management platform, which has historically achieved a 20x pull-through multiple on project bookings. Construction inflation, driven by high data center activity, is creating additional cost challenges for institutional and healthcare clients. Amended the credit agreement to increase revolving credit facility availability from $100 million to $125 million to support future disciplined M&A. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management noted that while healthcare remains a challenged environment due to policy impacts, the company is still gaining market share. Confidence in future revenue is supported by three consecutive quarters of strong bookings totaling $616 million. The 14.5% GCR margin was primarily a result of project timing and rebuilding the backlog from a low point at the end of Q2 2026. Management views data center penetration as essential for absorbing fixed costs and eventually driving higher margins through speed-to-market solutions. Simpcore provides early visibility into project budgets exceeding $8 billion, allowing Limbach to influence engineering and maintenance decisions. The acquisition provides immediate access to new geographic markets like Northern Virginia and Atlanta where Limbach previously lacked a presence. Management described 2026 as a 'reset' year for guidance to ensure a more resilient model heading into 2027. Margin improvement will depend on diversifying into high-growth markets and better fixed-cost absorption across the national platform.

Interested in Limbach Holdings, Inc.? Here are five stocks we like better. Second-quarter profitability weakened despite revenue rising 22% to $173.5 million, as gross margin fell to 21.5%, net income declined 39% to $4.7 million, and adjusted EBITDA dropped 22% to $13.9 million. Project timing, softness in healthcare and institutional markets, and competition for labor and materials pressured results. Limbach acquired data-center program manager CYMCOR for $30 million, expanding its mission-critical infrastructure capabilities and geographic reach. CYMCOR is expected to contribute $12 million in revenue and $4 million in adjusted EBITDA in 2027, excluding potential follow-on services. The company raised its 2026 revenue outlook to $760 million-$790 million but cut its adjusted EBITDA forecast to $78 million-$84 million. Strong bookings and improved backlog support potential 2027 gains, while management described 2026 as a reset period focused on margins, data centers, industrial expansion, and integration. Limbach (NASDAQ:LMB) reported second-quarter 2026 results that fell short of management’s expectations as project timing, healthcare and institutional-market softness, and margin pressure weighed on profitability. The company also announced the acquisition of data center program manager CYMCOR for $30 million, positioning the deal as part of a broader effort to diversify its end markets and geographic reach. President and Chief Executive Officer Michael McCann said customer demand remained healthy despite near-term pressure. Limbach recorded $182 million in bookings during the quarter, its third consecutive quarter of strong booking activity, bringing total bookings over the past three quarters to $616 million. → SpaceX’s First Earnings Report Could Decide Whether Shorts or Bulls Have Control “Our results fell short of expectations, driven by project timing and ongoing softness in healthcare and institutional markets from elevated price sensitivity and market conditions pressuring gross margins,” McCann said. “However, underlying customer demands remained healthy.” Total second-quarter revenue increased to $173.5 million from $142.2 million a year earlier, primarily reflecting a $30.9 million revenue contribution from Pioneer Power. Owner Direct Relationships, or ODR, revenue rose 17.9% to $128.4 million and represented 74% of total quarterly revenue. ODR organic revenue declined 3.4%, while acquisition-related ODR revenue increased 21.3%. → 3 Drone Stocks That Should Soar After the Summer Slump General Contractor Relationships, or GCR, revenue increased 35.3% to $45 million. Organic GCR revenue rose 12%, while acquisition-related revenue increased 23.3%. Profitability declined as the company’s gross margin fell to 21.5% from 28% in the prior-year quarter. Gross profit decreased 6.4% to $37.3 million. ODR gross margin was 24%, compared with 29% a year ago, while GCR gross margin fell to 14.5% from 24.7%. → The Bitcoin Comeback May Already Be Underway—2 ETFs for Exposure Executive Vice President and Chief Financial Officer Jayme Brooks said both segments were affected by Pioneer Power’s lower current margin profile. Margins were also pressured by lower net project write-ups than in the prior-year period and competition for skilled labor and materials related to data center construction activity. Net income declined 38.8% to $4.7 million, or $0.39 per diluted share, from $7.8 million, or $0.64 per diluted share, in the prior-year period. Adjusted EBITDA fell 22.3% to $13.9 million, and adjusted EBITDA margin declined to 8% from 12.6%. SG&A expense rose to $28.1 million from $26.6 million, driven primarily by Pioneer Power-related costs and increased stock-based compensation and payroll-related expenses. However, SG&A as a percentage of revenue improved to 16.2% from 18.7%. Limbach generated $18.7 million of operating cash flow during the quarter, compared with $2 million in the year-earlier period. Free cash flow, defined by the company as operating cash flow excluding changes in working capital minus capital expenditures, was $13.7 million, down from $16.1 million a year earlier. The company said free-cash-flow conversion equaled 98.2% of adjusted EBITDA, compared with 89.7% in the prior-year quarter. As of June 30, Limbach had $17.5 million in cash and cash equivalents and total debt of $41.1 million, including $17.5 million borrowed under its revolving credit facility. Total liquidity was $93.1 million. On July 24, the company amended its credit agreement to expand available borrowing capacity under its revolving credit facility to $125 million from $100 million. The additional capacity was followed by the completion of the CYMCOR acquisition, which was funded with available cash and revolver borrowings. McCann said CYMCOR adds a national program-management capability focused on data center customers and is intended to support Limbach’s push into mission-critical infrastructure. CYMCOR oversees customer project budgets with a cumulative value exceeding $8 billion, according to Limbach. The company expects CYMCOR to generate $12 million of program-management revenue and $4 million of adjusted EBITDA in 2027. Management said the acquisition should create opportunities to provide engineering, construction, commissioning, maintenance and other lifecycle services to customers that engage CYMCOR early in a facility’s planning process. McCann compared the opportunity to Limbach’s healthcare program-management platform, which generated approximately $3 million in professional-services revenue and pulled through roughly $60 million in project bookings during the past 12 months. CYMCOR has operations in Texas as well as Atlanta, Charlotte, Northern Virginia and the Richmond area, McCann said. He noted that several of those markets are outside Limbach’s current footprint and could provide visibility into future geographic expansion opportunities. The company said Pioneer Power, acquired in July 2025, is performing in line with its integration expectations. McCann said Pioneer Power’s gross margin improved by approximately 1.5 percentage points in the first half of 2026 compared with its margin at acquisition. Limbach is pursuing operational and pricing actions intended to bring the business’s gross margin in line with the company average over the next two to three years. Limbach increased its 2026 revenue outlook while lowering its adjusted EBITDA forecast to account for project commencement timing, margin pressures and execution headwinds. The revised outlook excludes contributions from CYMCOR and any future acquisitions. Revenue: $760 million to $790 million Adjusted EBITDA: $78 million to $84 million Total organic revenue growth: 9% to 14% ODR organic revenue growth: 6% to 10% Gross margin: 23% to 24% SG&A as a percentage of revenue: 15% to 16% The company maintained its expectation to convert at least 75% of adjusted EBITDA into free cash flow for 2026 and expects capital expenditures to run at approximately $5 million. McCann said Limbach is treating 2026 as a reset period while it works to build a more resilient model through data center and industrial expansion, acquisitions in targeted regions, and greater use of its integrated operating platform. He said management expects the strong recent booking activity and a rebuilt GCR backlog to support opportunities for improved performance in 2027, though project timing could shift some of that benefit beyond 2026. Limbach Holdings, Inc (NASDAQ: LMB) is a U.S.-based mechanical construction firm specializing in the design, installation and maintenance of heating, ventilation and air conditioning (HVAC) systems, piping, plumbing and sheet metal fabrication. The company delivers comprehensive mechanical solutions to commercial, institutional, health care, education, government and industrial clients, drawing on its in-house engineering, prefabrication and construction management capabilities. The company's service offerings encompass full-scope mechanical construction, including energy system design, direct digital controls and building automation, retrofits, testing and balancing, preventive maintenance programs and emergency response services. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Limbach Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for August 2026.

This article first appeared on GuruFocus. Total Revenue: $173.5 million in Q2 2026, up from $142.2 million in Q2 2025, driven primarily by a $30.9 million contribution from Pioneer Power. ODR Revenue: Grew 17.9% to $128.4 million, with acquisition-related revenue up 21.3% and organic revenue down 3.4%; ODR accounted for 74% of total revenue. GCR Revenue: Increased 35.3% to $45 million, with acquisition-related revenue up 23.3% and organic revenue up 12%. Gross Profit: Decreased 6.4% to $37.3 million from $39.8 million; total gross margin was 21.5%, down from 28% in the prior year quarter. ODR Gross Margin: 24%, down from 29% in the prior year period. GCR Gross Margin: 14.5%, down from 24.7% in the prior year period. SG&A Expense: $28.1 million, up from $26.6 million, but as a percentage of revenue decreased to 16.2% from 18.7%. Net Income: Decreased 38.8% to $4.7 million from $7.8 million; earnings per diluted share was $0.39 compared to $0.64. Adjusted Net Income: Decreased 32.1% to $7.6 million from $11.3 million; adjusted diluted EPS decreased from $0.93 to $0.64. Adjusted EBITDA: Decreased 22.3% to $13.9 million from $17.9 million; adjusted EBITDA margin was 8% compared to 12.6%. Operating Cash Flow: Net operating cash inflow was $18.7 million, compared to $2 million in the year-ago period. Free Cash Flow: $13.7 million in Q2 2026, compared to $16.1 million in Q2 2025; free cash flow conversion of adjusted EBITDA was 98.2% versus 89.7%. Bookings: $182 million in Q2 2026, bringing total bookings over the past three quarters to $669 million. Balance Sheet: Cash and cash equivalents of $17.5 million and total debt of $41.1 million as of June 30, 2026; total liquidity was $93.1 million. Fiscal 2026 Outlook: Revenue expected at $760 million to $790 million; adjusted EBITDA expected at $78 million to $84 million; gross margin percentage of 23% to 24%; SG&A expense as a percentage of total revenue of 15% to 16%. Warning! GuruFocus has detected 3 Warning Sign with LMB. Is LMB fairly valued? Test your thesis with our free DCF calculator. Release Date: August 05, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Limbach Holdings Inc (NASDAQ:LMB) reported strong bookings of $182 million in Q2 2026, marking the third consecutive quarter of robust bookings, totaling $669 million over the past three quarters. The acquisition of CYMCOR expands Limbach Holdings Inc (NASDAQ:LMB)'s geographic footprint into high-growth regions like Texas, Atlanta, and Northern Virginia, and enhances its data center capabilities with early customer engagement. Limbach Holdings Inc (NASDAQ:LMB) generated strong operating cash flow of $18.7 million in Q2 2026, its second-highest second-quarter operating cash flow since becoming a public company. The company's healthcare program management platform has proven successful, generating approximately $3 million in professional service revenue and pulling through $60 million in project bookings, a 20 times pull-through multiple. Limbach Holdings Inc (NASDAQ:LMB) increased its revolving credit facility from $100 million to $125 million, providing additional liquidity to support its disciplined acquisition strategy and growth initiatives. Limbach Holdings Inc (NASDAQ:LMB)'s Q2 2026 results fell short of expectations due to project timing and ongoing softness in healthcare and institutional markets, with elevated price sensitivity pressuring gross margins. Total gross margin decreased significantly to 21.5% in Q2 2026, down from 28% in the prior year quarter, driven by lower margins from Pioneer Power and reduced net project write-ups. Adjusted EBITDA decreased 22.3% to $13.9 million in Q2 2026, with adjusted EBITDA margin falling to 8% from 12.6% in the prior year period. The company lowered its fiscal 2026 adjusted EBITDA guidance to $78 million to $84 million, reflecting near-term margin and execution headwinds, despite increasing its revenue outlook. ODR organic revenue decreased 3.4% in Q2 2026, reflecting continued softness in healthcare and institutional markets, with customers delaying decision-making and showing increased price sensitivity. Q: Can you provide more color on the healthcare and institutional market environment, especially regarding gaining market share versus pricing sensitivity, and how should we look at that environment and strategic initiatives in the back half and 2027?A: Michael McCann (President and CEO): The healthcare environment remains challenged, impacted by policy changes in 2025, with customers navigating a new normal. They are also affected by construction inflation from data center activity, making their projects more costly. We are investing in national account managers to guide customers through short-term challenges, and while healthcare is not as fast-growing as data centers, it remains a great long-term market for us to balance our portfolio. Q: Could you give us more color on data center work beyond mix and growth opportunities, specifically on gross margin profiles, key costs, overrun risks, and contract structure mix?A: Michael McCann (President and CEO): Unlike institutional healthcare customers who are cost-driven, data center customers prioritize time and schedule, and will pay for speed to market. This presents a margin opportunity for us. The CYMCOR acquisition is key to jumpstarting our data center strategy by getting us involved earlier in the process through professional services, allowing us to influence project outcomes and provide solutions that can drive better margins. Q: In the CYMCOR acquisition, could you talk about more opportunities for both growth and margin profiles, and how you manage execution risk with the Pioneer Power integration?A: Michael McCann (President and CEO): CYMCOR mirrors our successful healthcare program management platform, which generated $3 million in professional service revenue and pulled through $60 million in project bookings. We see a similar pull-through opportunity in the hot data center market without the execution risk of a traditional contractor. Regarding Pioneer Power, it is performing as expected, with gross margins already improving by 150 basis points since acquisition, and we are on track with our integration roadmap to bring margins in line with the company average over the next two to three years. Q: I wanted to understand when CYMCOR is brought into a project, how much visibility they have, and their ability to bring Limbach services into that equation. How long would it take to translate professional services revenue into additional services for Limbach?A: Michael McCann (President and CEO): CYMCOR is involved very early in the project lifecycle, sometimes even at the real estate planning stage, helping customers manage budgets and cost controls. This provides us with significant visibility. We will approach this similarly to healthcare, with some immediate opportunities expected. Given the exploding demand in data centers, we will look at fabrication, procurement, and project execution, as well as service and maintenance after building completion. The timing of pull-through depends on our ability to capitalize on these opportunities. Q: Is CYMCOR geographically concentrated in the Texas area or do they have projects all over?A: Michael McCann (President and CEO): CYMCOR has a presence in Dallas/Fort Worth, other parts of Texas, Atlanta, Charlotte, and Northern Virginia/Richmond. These are markets where we currently lack presence, which is attractive. It gives us a look into these high-growth markets and may eventually lead to further geographic expansion through acquisitions or connecting our existing capabilities to create pull-through opportunities. Q: On ODR, healthcare and institutional markets are under pressure on spending and costs. How do you recapture those margins? Is this a pricing game, and at some point, do healthcare companies just have to absorb these costs?A: Michael McCann (President and CEO): Healthcare customers are methodical and will not completely change how they purchase, but it takes time. Our job is to help them look at things differently, such as bundling projects and evaluating portfolio performance. Diversifying into other vertical markets will also help with fixed cost absorption. There is no magic button, but our ability to stick with customers, find avenues to drive value, and maintain long-term relationships will drive opportunities. Q: On the margin question, how long does it take for the improvement initiatives to cycle through, and can we see improvement in 2027?A: Michael McCann (President and CEO): Project timing is a key factor, stemming from the lack of sales in the middle of last year. Based on our current strong book of business, we look forward to potential margin opportunities as we enter 2027. Additionally, diversifying into high-growth vertical markets like data centers and expanding geographically will contribute to margin improvement. We are making adjustments to ensure increased opportunity in 2027. Q: On CYMCOR pull-through in the data center market, how long does that take to work through the system, and what is the timing aspect?A: Michael McCann (President and CEO): We are already working with program managers in the data center space, so we have some experience. We want to understand and learn CYMCOR's customers, who are additive to our existing ones. It will take a little time, but we will immediately look for pull-through opportunities, potentially talking to people in the next few days. We are opportunistic, but it will take some time to materialize. Q: Can you give us a sense for how fast CYMCOR has been growing?A: Michael McCann (President and CEO): CYMCOR has been steady from an earnings perspective, working in data centers for the last four or five years. Their main challenge has been responding to demand due to recruiting constraints. They are excited about our ability to immediately add staff, which was a holdup to even more growth. We will be immediately looking to add staff to their team to drive high-quality, high gross margin revenue. Q: Circling back to GCR gross margins, were there one or two projects in particular that drove the lower gross margin, or is it more broad-based?A: Michael McCann (President and CEO): It was not an execution issue; it was more about project starting. Our GCR backlog was only $99 million at the end of Q2, but we have since built it back up to basically double. The low margin reflects timing as new projects start. We anticipate GCR margins will improve as we perform on this new backlog, though the opportunity may shift into 2027, which is why we adjusted our guidance. Q: With GCR now back to more of a growth mode, how are you thinking about the long-term mix between the two segments?A: Michael McCann (President and CEO): We updated our guidance for ODR For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Increases Full Year 2026 Revenue Guidance to $760 million to $790 million and Revises Adjusted EBITDA Guidance to $78 million to $84 million TAMPA, Fla., August 04, 2026--(BUSINESS WIRE)--Limbach Holdings, Inc. (Nasdaq: LMB) ("Limbach" or the "Company"), a building systems solutions firm that partners with building owners and operators who have mission-critical mechanical, electrical, plumbing, and controls, or MEPC, systems today announced its financial results for the quarter ended June 30, 2026. Second Quarter 2026 Highlights Compared to Second Quarter 2025 Total revenue increased 21.9% to $173.5 million from $142.2 million Owner Direct Relationships ("ODR") revenue increased 17.9%, or $19.5 million, to $128.4 million, or 74.0% of total revenue Total bookings during the quarter were $182.0 million, generating a book-to-bill ratio of 1.1x Net income of $4.7 million, or $0.39 per diluted share, compared to $7.8 million, or $0.64 per diluted share Adjusted net income of $7.6 million, or $0.64 per adjusted diluted earnings per share, compared to adjusted net income of $11.3 million, or $0.93 per adjusted diluted earnings per share Adjusted EBITDA of $13.9 million, compared to $17.9 million Total gross profit of $37.3 million, compared to $39.8 million Net cash provided by operating activities of $18.7 million compared to $2.0 million Management Comments "Our second quarter results were primarily affected by project timing and price sensitivity in certain markets rather than a deterioration in underlying demand leading to results that fell below our expectations," said Michael McCann, President and Chief Executive Officer of Limbach. "Importantly, bookings remained strong at $182.0 million, producing a 1.1x book-to-bill ratio, and reinforcing our confidence that customer demand remains healthy. Based on our strong bookings and the visibility we have into the second half of the year, we believe our revised outlook appropriately reflects the current operating environment and positions us to execute successfully. "This quarter highlights the importance of executing our strategy of expanding into attractive end markets where we can broaden our service offerings and improve the long-term durability and quality of our earnings. This includes earlier engagement across facility lifecycles to generate opportunities to deliver a broader range of higher-value services while strengthening customer relationships over time. This strategy builds a more balanced and resilient platform positioned to capitalize on attractive secular growth trends. Supported by our strong balance sheet, disciplined capital allocation, and continued operational execution, we believe these initiatives will strengthen margins, enhance earnings power, and increase long-term shareholder value." The following are results for the three months ending June 30, 2026, compared to the three months ending June 30, 2025: Total revenue increased 21.9%, or $31.2 million, to $173.5 million from $142.2 million. The increase in revenue was primarily attributable to Pioneer Power, which was acquired in July 2025, and contributed a full quarter of revenue in the current period with no comparable contribution in the prior-year period. Of the total increase in revenue, acquisition-related revenue represented 21.7%, or $30.9 million. The Company's organic revenue increased slightly for the three months ended June 30, 2026. The Company expects the timing of project commencements and execution within its existing backlog, together with currently expected future bookings, to support organic revenue growth during the remainder of 2026. Total gross profit decreased 6.4% to $37.3 million compared to $39.8 million. Total gross margin of 21.5% decreased from 28.0%. The decrease in segment gross margin percentages was primarily driven by the current lower margin profile of Pioneer Power. Pioneer Power continues to perform in line with the Company’s integration expectations and management expects gross margins to improve as 2026 progresses. Operational and pricing improvement initiatives are underway to enhance profitability at Pioneer Power with the goal of bringing gross margins in line with the Company average over the next two to three years. Gross profit margin was also negatively impacted by lower net project write-ups compared to the prior year period and competition for skilled labor and materials associated with construction activity in data center markets. Selling, general and administrative ("SG&A") expense increased by approximately $1.5 million to $28.1 million, compared to $26.6 million in the prior year period. The increase was primarily driven by a $0.7 million increase in incremental SG&A expense associated with the Pioneer Power acquisition and an aggregate $0.6 million increase in total stock-based compensation and payroll related expenses. SG&A expense as a percentage of revenue decreased to 16.2% for the three months ended June 30, 2026, compared to 18.7% for the three months ended June 30, 2025. Interest expense was $0.8 million, an increase of $0.2 million, compared to $0.6 million in the prior year period. The increase in interest expense was driven by higher average borrowings under the Company’s revolving credit facility, as well as increased financing costs associated with a larger vehicle fleet. Interest income decreased by $0.3 million compared to the prior year period, primarily due to lower average cash and cash equivalent balances and lower yields on investments. Net income decreased 38.8% to $4.7 million from $7.8 million. Diluted earnings per share was $0.39 compared to $0.64 in the prior year period. Adjusted net income decreased 32.1% to $7.6 million compared to $11.3 million. Adjusted diluted earnings per share was $0.64 compared to $0.93 in the prior year period. Adjusted EBITDA decreased 22.3% to $13.9 million compared to $17.9 million in the prior year period. Net cash provided by operating activities was $18.7 million compared to $2.0 million in the prior year period. Balance Sheet On June 30, 2026, cash and cash equivalents were $17.5 million. Current assets were $223.1 million and current liabilities were $150.2 million, representing a current ratio of 1.49x compared to 1.44x at December 31, 2025. On June 30, 2026, the Company had $17.5 million in borrowings under its revolving credit facility and $7.0 million of standby letters of credit. The Company intends to deploy free cash flow to continue to reduce its borrowings under its revolving credit facility for the remainder of the year. As we previously reported, on July 24, 2026, the Company entered into an amendment to its amended and restated credit agreement with its lender, Wheaton Bank & Trust Company, N.A., a subsidiary of Wintrust Financial Corporation, to increase the aggregate principal amount of available borrowings under its revolving credit facility from $100 million to $125 million and make certain related conforming changes to the credit facility. On August 4, 2026, the Company completed its acquisition of CYMCOR, Inc. ("CYMCOR"), for a purchase price at closing of $30.0 million. The purchase price is subject to customary working capital adjustments. The acquisition was funded through a combination of available cash and borrowing under the Company’s recently expanded revolving credit facility. The CYMCOR acquisition occurred after the end of the second quarter. The balance sheet information as of June 30, 2026 does not include the funding impact of the acquisition. 2026 Guidance The Company is updating its FY 2026 guidance as follows to reflect its current operating environment. The revised guidance excludes any contribution from the recently completed CYMCOR acquisition or future acquisitions. With respect to projected 2026 Adjusted EBITDA guidance and Adjusted EBITDA Margin (and the assumptions underlying those projections), a quantitative reconciliation is not available without unreasonable efforts due to the high variability, complexity and low visibility with respect to certain items, which are excluded from Adjusted EBITDA (and components that go into the calculation of Adjusted EBITDA). The Company expects the variability of these items to have a potentially unpredictable, and potentially significant, impact on future financial results. Conference Call Details Access by Webcast The call will also be simultaneously webcast over the Internet via the "Investor Relations" section of Limbach’s website at www.limbachinc.com or by clicking on the conference call link: https://event.choruscall.com/mediaframe/webcast.html?webcastid=LYkmLAUY. An audio replay of the call will be archived on Limbach’s website for 365 days. About Limbach Limbach is a building systems solutions firm that designs, delivers, and maintains mechanical (heating, ventilation, and air conditioning), electrical, plumbing, and controls ("MEPC") systems that support life’s most important moments. We partner with building owners and operators of mission-critical facilities across healthcare, industrial and manufacturing, data centers, life sciences, higher education, and cultural and entertainment markets. With approximately 1,600 team members across 22 offices throughout the Eastern and Midwestern regions of the United States, we strive to be an indispensable partner by combining our national capabilities with strong local execution and talent to deliver proactive, safe, and reliable solutions for complex facilities. Operating on a connected platform, we integrate engineering expertise with field execution to provide customized MEPC infrastructure solutions that address both operational and capital project needs, optimizing performance, enhancing reliability, and ensuring long-term safety. Additional Information Investors and others should note that Limbach announces material financial information to its investors using its investor relations website, U.S. Securities and Exchange Commission (the "SEC") filings, press releases, public conference calls/videos, and webcasts. Limbach uses these channels, as well as social media, to communicate with our stockholders and the public about the Company, the Company’s services and other Company information. It is possible that the information that Limbach posts on social media could be deemed to be material information. Therefore, Limbach encourages investors, the media, and others interested in the Company to review the information posted on the social media channels listed on Limbach’s investor relations website. Forward-Looking Statements We make forward-looking statements in this press release within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to expectations or forecasts for future events, including, without limitation, our earnings, Adjusted EBITDA, projected EBITDA production from possible acquisitions, bookings, projected full year 2026 organic ODR and/or organic revenue growth, revenues, expenses, backlog, capital expenditures or other future financial or business performance or strategies, results of operations or financial condition, timing of the recognition of backlog as revenue, the potential for recovery of cost overruns, and the ability of Limbach to successfully remedy the issues that have led to write-downs in various business units and the Company’s business being negatively affected by the health crises or outbreaks of diseases, such as epidemics or pandemics (and related impacts, such as supply chain disruptions). These statements also may include our assumptions related to our 2026 guidance of full year revenue and Adjusted EBITDA. These statements may be preceded by, followed by or include the words "may," "might," "will," "will likely result," "should," "estimate," "plan," "project," "forecast," "intend," "expect," "anticipate," "believe," "seek," "continue," "target," "goal," or similar expressions. These forward-looking statements are based on information available to us as of the date they were made and involve a number of risks and uncertainties, which may cause them to turn out to be wrong. There may be additional risks that we consider immaterial or which are unknown. Accordingly, forward-looking statements should not be relied upon as representing our views as of any subsequent date, and we do not undertake any obligation to update forward-looking statements to reflect events or circumstances after the date they were made, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws. As a result of a number of known and unknown risks and uncertainties, our actual results or performance may be materially different from those expressed or implied by these forward-looking statements. Please refer to our most recent annual report on Form 10-K, as well as our subsequent filings on Form 10-Q and Form 8-K, which are available on the SEC’s website (www.sec.gov), for a full discussion of the risks and other factors that may impact any forward-looking statements in this press release. Non-GAAP Financial Measures In assessing the performance of our business, management utilizes a variety of financial and performance measures. The key measures are Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Diluted Earnings per Share, which are non-GAAP financial measures. Adjusted EBITDA and Adjusted EBITDA Margin We define Adjusted EBITDA as net income plus depreciation and amortization expense, interest expense, and taxes, as further adjusted to eliminate the impact of, when applicable, other non-cash items or expenses that are unusual or non-recurring that we believe do not reflect our core operating results. We define Adjusted EBITDA Margin as Adjusted EBITDA divided by total revenue. Our board of directors and executive management team focus on Adjusted EBITDA and Adjusted EBITDA Margin as two of our key performance and compensation measures. Adjusted EBITDA and Adjusted EBITDA Margin assists us in comparing our performance over various reporting periods on a consistent basis because it removes from our operating results the impact of certain items that do not necessarily reflect our core operations. We believe that Adjusted EBITDA and Adjusted EBITDA Margin are meaningful to our investors to enhance their understanding of our financial performance for the current period and our ability to generate cash flows from operations that are available for taxes, capital expenditures and debt service. Adjusted Net Income and Adjusted Diluted Earnings per Share We define Adjusted Net Income as net income, adjusted to exclude certain items that do not reflect our core operating performance, such as amortization of intangible assets, stock-based compensation, restructuring charges, the change in fair value of contingent consideration, acquisition and other transaction costs and the net tax effect of reconciling items, as further adjusted to eliminate the impact of, when applicable, other non-cash or expenses that are unusual or non-recurring. We define Adjusted Diluted Earnings per Share as Adjusted Net Income divided by the weighted average diluted shares outstanding. We believe Adjusted Net Income and Adjusted Diluted Earnings per Share are useful to investors as we use these metrics to assist with strategic decision making, forecasting future results, and evaluating current performance. We understand that these non-GAAP financial measures are frequently used by securities analysts, investors and other interested parties as a measure of financial performance and to compare our performance with the performance of other companies that report Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Diluted Earnings per Share. Our calculations of these non-GAAP measures, however, may not be comparable to similarly titled measures reported by other companies. When assessing our operating performance, investors and others should not consider this data in isolation or as a substitute for net income calculated in accordance with GAAP. Further, the results presented by Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Net Income and Adjusted Diluted Earnings per Share cannot be achieved without incurring the costs that the measure excludes. A reconciliation of net income to Adjusted EBITDA and net income to Adjusted Net Income, the most comparable GAAP measures, are provided below. Backlog and Bookings We refer to our estimated revenue on uncompleted contracts, including the amount of revenue on contracts for which work has not begun, less the revenue we have recognized under such contracts, as "backlog." Backlog includes unexercised contract options. Bookings (we also refer to bookings in certain instances as sales booked) represent the total contract value agreed upon when a customer commits to services. We believe bookings provide an indication of trends in our operating results, including potential cash flows, that are not necessarily reflected in our revenue because we recognize revenue in accordance with ASC 606 – Revenue from Contracts with Customers, which is different from how we present bookings. See Note 4 – Revenue from Contracts with Customers within our Form 10-Q for the quarter ended June 30, 2026, for additional discussion on revenue recognition. Our bookings may vary significantly quarter to quarter depending in part on the timing of the execution of our agreements with our customers. Our book-to-bill ratio is defined as bookings for the defined period divided by revenue for the defined period. Measuring bookings involves the use of estimates and judgments and there are no independent standards or requirements governing the calculation of bookings. The extent and timing of conversion of bookings to revenue may be impacted by, among other factors, the types of services sold, agreement duration, the pace of customer spending, actual volumes of services delivered as compared to the volumes anticipated at the time of sale, and agreement modifications, including terminations, over the lifetime of agreements. Some of our arrangements are terminable by the customer. We do not update our bookings for subsequent terminations. Information regarding our bookings is not comparable to, nor should it be substituted for, an analysis of our reported revenue. However, management believes that it is a key indicator of potential future business and provides a useful indicator of the volume of our business over time as a key metric. Supplemental Revenue Disclosures Organic and acquisition-related revenue are not defined under GAAP and may not be comparable to similarly-titled measures used by other companies and should not be considered a substitute for revenue as determined in accordance with GAAP. Management believes these non-GAAP measures provide useful information to investors by highlighting the underlying growth trends of the Company’s existing operations, separate from the effects of recent acquisitions. Organic revenue reflects the change in revenue from the Company’s continuing operations excluding the impact of acquisitions, while acquisition-related revenue represents the incremental contribution from businesses acquired only for the twelve-month period following the date of acquisition. These measures are intended to enhance investors’ understanding of the Company’s performance and trends over time, and should be considered in conjunction with, but not as a substitute for, GAAP revenue. The following are reconciliations of reported revenue to organic / acquisition-related revenue for the three and six months ended June 30, 2026, compared to revenue for the three and six months ended June 30, 2025: View source version on businesswire.com: https://www.businesswire.com/news/home/20260804326592/en/ Contacts Investor Relations Financial Profiles, Inc.Lisa [email protected]

Building systems company Limbach (NASDAQ:LMB) will be announcing earnings results this Tuesday after market close. Here’s what you need to know. Limbach beat analysts’ revenue expectations last quarter, reporting revenues of $138.9 million, up 4.3% year on year. It was a very strong quarter for the company, with a beat of analysts’ EPS estimates and an impressive beat of analysts’ EBITDA estimates. Is Limbach a buy or sell going into earnings? Read our full analysis here, it’s free for active Edge members. This quarter, the market is expecting Limbach’s revenue to grow 24.6% year on year, improving from the 16.4% increase it recorded in the same quarter last year. Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business will stay the course heading into earnings. Limbach has missed Wall Street’s revenue estimates multiple times over the last two years. Looking at Limbach’s peers in the construction and maintenance services segment, some have already reported their Q2 results, giving us a hint as to what we can expect. MYR Group delivered year-on-year revenue growth of 20.1%, beating analysts’ expectations by 8.3%, and Comfort Systems reported revenues up 50.3%, topping estimates by 9.9%. MYR Group traded up 2.7% following the results while Comfort Systems was down 5.3%. Read our full analysis of MYR Group’s results here and Comfort Systems’s results here. Over the last year or so, investors' attention has moved from one major market theme to the next, spanning AI disruption and surging infrastructure investment to geopolitical tensions, interest rates, and the health of the broader economy. While some of the construction and maintenance services stocks have shown solid performance in this choppy environment, the group has generally underperformed, with share prices down 5% on average over the last month. Limbach is down 11.9% during the same time and is heading into earnings with an average analyst price target of $115.60 (compared to the current share price of $71.69). ALSO WORTH WATCHING: Nvidia’s Quiet Partner. Nvidia’s chips cost a hundred grand. The connectors that make them work cost even more. One company makes them all. Every AI server needs specialized infrastructure the chip companies don’t make. High-speed cables. Power connectors. Thermal sensors. This 90-year-old company built a monopoly on it. The AI boom just started. This stock is still flying under the radar. Claim The Stock Ticker Here for FREE.

The market expects Limbach (LMB) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended June 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates. The earnings report, which is expected to be released on August 4, might help the stock move higher if these key numbers are better than expectations. On the other hand, if they miss, the stock may move lower. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. This company is expected to post quarterly earnings of $0.98 per share in its upcoming report, which represents a year-over-year change of +5.4%. Revenues are expected to be $178.46 million, up 25.5% from the year-ago quarter. The consensus EPS estimate for the quarter has been revised 0.16% higher over the last 30 days to the current level. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that an aggregate change may not always reflect the direction of estimate revisions by each of the covering analysts. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For Limbach, the Most Accurate Estimate is higher than the Zacks Consensus Estimate, suggesting that analysts have recently become bullish on the company's earnings prospects. This has resulted in an Earnings ESP of +0.26%. On the other hand, the stock currently carries a Zacks Rank of #3. So, this combination indicates that Limbach will most likely beat the consensus EPS estimate. While calculating estimates for a company's future earnings, analysts often consider to what extent it has been able to match past consensus estimates. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that Limbach would post earnings of $0.28 per share when it actually produced earnings of $0.64, delivering a surprise of +128.57%. Over the last four quarters, the company has beaten consensus EPS estimates three times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. Limbach appears a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Limbach Holdings, Inc. (LMB) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research