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    Aaron Spychalla

    Senior Research Analyst at Craig-Hallum Capital Group

    Aaron Spychalla, CFA, is a Senior Research Analyst at Craig-Hallum Capital Group specializing in industrials and clean technologies, where he has been instrumental in building the research practice since 2011. He covers companies such as Bowman Consulting Group and delivers investment recommendations that have contributed to analyst consensus strong buy ratings and notable upside targets for covered equities. With nearly 15 years at Craig-Hallum and a career rooted in industrials equity research, Spychalla has established a reputation for detailed sector analysis and actionable insights. He holds the Chartered Financial Analyst (CFA) designation as part of his professional credentials.

    Aaron Spychalla's questions to Shimmick (SHIM) leadership

    Aaron Spychalla's questions to Shimmick (SHIM) leadership • Q2 2025

    Question

    Asked about the growth and composition of the project pipeline, the progress on operational improvements and margin targets, and the timeline and risks associated with completing the remaining non-core legacy projects.

    Answer

    The company reported a significant increase in its 12-month pipeline to $4.5 billion, up from $2 billion, with win rates around 15-20%. Margins on core 'Shimick' projects are improving and are being bid at 10-20%, but overall margins are dragged down by legacy non-core work. Most non-core work is expected to be completed by late 2025, with one project extending into late 2026, and the associated risk is steadily decreasing.

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    Aaron Spychalla's questions to Shimmick (SHIM) leadership • Q4 2024

    Question

    Aaron Spychalla of Craig-Hallum Capital Group LLC asked about the potential impact of federal budget uncertainties, such as the IIJA, on the project pipeline. He also inquired about the current bid activity, confidence in securing profitable work, labor availability on the West Coast, and the company's outlook for free cash flow in 2025.

    Answer

    CEO Ural Yal stated that Shimmick has not seen any impact from federal budget issues on active projects, noting their portfolio is more reliant on IRA funding, which is expected to remain robust. He expressed confidence in the project pipeline and highlighted a strategic push to diversify into the private sector. Yal confirmed that labor availability on the West Coast is currently sufficient for growth. Regarding cash flow, he and Interim CFO Amanda Mobley affirmed a strong liquidity position of $100 million, stringent cash controls, and a newly secured revolving credit facility, providing confidence in funding operations and growth through 2025.

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    Aaron Spychalla's questions to Shimmick (SHIM) leadership • Q3 2024

    Question

    Aaron Spychalla asked about the potential for future operating expense reductions, the timeline for the project pipeline converting into backlog, and the company's capital allocation priorities for 2025 following the receipt of the Golden Gate Bridge settlement proceeds.

    Answer

    CEO Steve Richards explained that while the company has invested in estimating resources, SG&A efficiencies are expected as legacy work burns off and the company focuses on its California operations. He noted that bidding is not seasonal and expects to win new work in Q4 and early 2025, with no decline in opportunities. Regarding capital allocation, Richards and Interim CFO Amanda Mobley stated the settlement proceeds significantly improve liquidity and will be used for ongoing operations, completing legacy jobs, and paying down debt.

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    Aaron Spychalla's questions to Quest Resource Holding (QRHC) leadership

    Aaron Spychalla's questions to Quest Resource Holding (QRHC) leadership • Q2 2025

    Question

    Aaron Spychalla from Craig-Hallum Capital Group LLC inquired about the ramp-up of new business from the previous year, the status of associated onboarding costs, client attrition trends, and the potential size of a recent new client win. He also asked for an update on the timeline for reducing Days Sales Outstanding (DSO).

    Answer

    CEO Perry Moss confirmed that the implementation and temporary costs for last year's new clients are now complete, and the focus has shifted to optimization. He stated there is no new attrition beyond previously discussed factors. Moss highlighted two recent wins—a retail expansion and a new multinational restaurant chain—both of which are significant 'seven or eight figure' accounts. CFO Brett Johnston added that he remains confident in generating significant cash flow and expects further DSO improvements in the second half of the year, targeting the mid-60s range into next year.

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    Aaron Spychalla's questions to Quest Resource Holding (QRHC) leadership • Q1 2025

    Question

    Inquired about progress on operational excellence initiatives since the last call, asking about identified process gaps, key performance indicators (KPIs), and the timeline for margin improvement from optimizing new business.

    Answer

    The company has baselined all processes and identified gaps, implementing fixes and 'quick hits' for Q2 impact. The focus is on converting business to profit through efficiency. Margin improvement will come from initiatives across sourcing, procure-to-pay, and order-to-cash, all aimed at boosting EBITDA, cash flow, and paying down debt.

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    Aaron Spychalla's questions to Quest Resource Holding (QRHC) leadership • Q4 2024

    Question

    Aaron Spychalla inquired about the status and cost implications of the new vendor management system, the stabilization of client attrition, the expected duration of weakness in industrial markets, and the strength of the sales pipeline. He also asked for details on the pending sale of the RWS mall business.

    Answer

    CFO Brett Johnston stated the vendor management system is substantially complete, with some temporary costs extending into Q1 but savings expected to ramp up in Q2. Chairman Daniel M. Friedberg added that future improvements will focus on process efficiency. CEO Perry W. Moss confirmed industrial weakness is expected for another two quarters and highlighted that a new, disciplined sales process has significantly grown the pipeline. Regarding the RWS sale, Friedberg noted a preliminary agreement prevents discussion of proceeds but confirmed the business was a non-contributor to the bottom line.

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    Aaron Spychalla's questions to Quest Resource Holding (QRHC) leadership • Q3 2024

    Question

    Aaron Spychalla asked for a quantification of the financial impact from the new vendor management system in Q3, whether there would be carryover costs into Q4, the current status of the sales and client onboarding cycles, and the potential business impact of a new political administration.

    Answer

    CFO Brett Johnston explained that while difficult to quantify precisely, the vendor system's cost impact was less than the $1 million in billing credits but still significant. He confirmed the system is now fully operational and expects related costs to be "much less impactful" going forward. Executive S. Hatch added that the sales cycle has "dramatically" accelerated, evidenced by a record nine new client signings. He also noted the client onboarding process is faster and more accurate due to technology investments. Regarding political impact, Hatch stated that since landfill regulation is primarily at the state and local level, he does not anticipate federal election results to significantly change the business.

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    Aaron Spychalla's questions to Babcock & Wilcox Enterprises (BW) leadership

    Aaron Spychalla's questions to Babcock & Wilcox Enterprises (BW) leadership • Q2 2025

    Question

    Aaron Spychalla of Craig-Hallum Capital Group LLC inquired about the current thermal energy demand, the potential for large upgrades and new builds including new coal-fired generation, the prospective size of these orders, the outlook for the second half of 2025, and the company's confidence in returning to positive free cash flow.

    Answer

    Kenneth Young, Chair & CEO, confirmed strong demand driven by data centers, noting a need for 120 gigawatts over ten years and active discussions for up to 20 gigawatts of new generation, including potential new U.S. coal plants. He indicated new project sizes could be in the low hundreds of millions. Regarding the second half outlook, Young anticipates a strong year due to high-margin parts and services but is still finalizing formal guidance. Cameron Frymyer, EVP & CFO, affirmed confidence in achieving positive free cash flow in the second half of 2025, supported by asset sales, debt reduction, and strong parts and services growth.

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    Aaron Spychalla's questions to Babcock & Wilcox Enterprises (BW) leadership • Q1 2025

    Question

    Aaron Spychalla inquired about Babcock & Wilcox's 2025 guidance, the potential impact of tariffs on project timing, the status of a major coal-to-gas conversion project, and the financing and timeline for the Massillon BrightLoop hydrogen project.

    Answer

    Chairman and CEO Kenneth Young stated that while the company is not updating its guidance, it is monitoring potential project delays from tariff negotiations. He confirmed the large Indiana natural gas conversion project is on schedule. For the Massillon BrightLoop project, Young noted it requires an additional $40-$50 million in financing, which they aim to secure in the next few months. The goal is to begin construction in Fall 2025 and start hydrogen production by mid-2026.

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    Aaron Spychalla's questions to Babcock & Wilcox Enterprises (BW) leadership • Q4 2024

    Question

    Aaron Spychalla inquired about the drivers behind the 2025 adjusted EBITDA guidance range, the current impact of tariffs, the status of the Wyoming BrightLoop project, and the potential effects of changing EPA emissions regulations on the Thermal business.

    Answer

    Chairman and CEO Kenneth Young explained that the guidance range reflects uncertainty from potential tariffs and ongoing debt restructuring. He noted it's too early to see specific project delays from tariffs but discussions are active. Regarding the Wyoming project, he cited progress with the Department of Energy despite administrative delays. For EPA regulations, Young stated that B&W is well-positioned whether clients maintain coal plants or convert to natural gas, as long-term economics, not short-term policy, drive those decisions.

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    Aaron Spychalla's questions to Babcock & Wilcox Enterprises (BW) leadership • Q3 2024

    Question

    Inquired about the revenue timing for the new coal-to-gas project, the pipeline for similar conversions, the current status of letters of credit, and the free cash flow outlook for 2025.

    Answer

    The natural gas conversion project will see revenues primarily in 2025 and 2026, with some in 2027. The pipeline for similar conversions includes over a dozen prospects. Letters of credit stand at approximately $80 million, which will reduce to around $70 million after the SPIG/GMAB sale, and will roll off over the next 1.5 years. Free cash flow conversion for 2025 is expected to be around 40% of EBITDA after accounting for interest expenses and BrightLoop capital expenditures.

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    Aaron Spychalla's questions to PERMA FIX ENVIRONMENTAL SERVICES (PESI) leadership

    Aaron Spychalla's questions to PERMA FIX ENVIRONMENTAL SERVICES (PESI) leadership • Q2 2025

    Question

    Aaron Spychalla of Craig-Hallum Capital Group LLC inquired about the operational challenges and margin outlook for the Treatment segment, the revised timeline for the Hanford DFLAW facility startup, and the near-term outlook for the Services segment, including the West Valley and RadMAC projects.

    Answer

    Mark Duff, President, CEO & Director, explained that early-quarter technical challenges in the Treatment segment, related to a new Hanford waste stream, have been resolved through automation, with benefits expected in the second half. He noted the DFLAW startup delay to as late as October 15 is due to technical issues like nitrogen oxides in off-gas systems, but Perma-Fix is prepared for the ramp-up. Duff also mentioned that the Services segment's West Valley project is in a slower-than-expected planning phase, with revenue recognition likely starting in Q1 2026.

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    Aaron Spychalla's questions to PERMA FIX ENVIRONMENTAL SERVICES (PESI) leadership • Q1 2025

    Question

    Aaron Spychalla inquired about several topics, including the near-term priorities and opportunity size for the Hanford grouting project, revenue and margin contribution from the new PFAS Gen 2 unit, the status of the Services business amid federal procurement delays, and the CapEx outlook for the year.

    Answer

    Executive Mark Duff addressed the questions, stating the DOE will define its Hanford grouting strategy by December 2025, and he expects Perma-Fix to play a major role. On PFAS, he projected the Gen 2 unit could help generate nearly $1 million per month. Duff also noted the Services project pipeline is improving after a trough, and that full-year CapEx is expected to be $5-$6 million, largely for the new PFAS reactor.

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    Aaron Spychalla's questions to PERMA FIX ENVIRONMENTAL SERVICES (PESI) leadership • Q4 2024

    Question

    Aaron Spychalla inquired about the near-term impact of federal budget uncertainties on operations and key projects like West Valley and Hanford, the operational readiness and phased startup of the DFLAW program, plant investment updates, and the cost and growth trajectory for the PFAS technology initiative.

    Answer

    Executive Mark Duff stated that a short government shutdown would have limited impact and that key projects like DFLAW are high-priority and expected to proceed. He confirmed DFLAW is on track for an August startup, with the company preparing operationally. CFO Ben Naccarato detailed that PFAS costs were about $3 million in 2024 and are projected to be around $5 million in 2025 for Gen 2 development. Mark Duff added that the Gen 2 PFAS unit is scheduled for late Q3 deployment.

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    Aaron Spychalla's questions to PERMA FIX ENVIRONMENTAL SERVICES (PESI) leadership • Q3 2024

    Question

    Aaron Spychalla inquired about the near-term outlook for Q4 and early 2025, the balance sheet and CapEx plans for the Hanford ramp-up, the market opportunity for transuranic (TRU) waste, and the potential impact of the recent election.

    Answer

    Mark Duff, Executive, stated that Q4 is trending much better than Q3 with stable waste receipts, and the company is prepared for the initial Hanford DFLAW ramp-up. Ben Naccarato, Executive, confirmed the balance sheet is in good shape with low debt. Duff added that TRU waste is a burgeoning market where Perma-Fix is uniquely positioned as the sole commercial operator. He also expressed optimism that a new administration would favor the commercialization of waste treatment, benefiting the company.

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    Aaron Spychalla's questions to Bowman Consulting Group (BWMN) leadership

    Aaron Spychalla's questions to Bowman Consulting Group (BWMN) leadership • Q2 2025

    Question

    Aaron Spychalla inquired about the growth drivers and outlook for the Transportation segment, the size and prospects of the energy transmission business, and the company's operating leverage and investment needs.

    Answer

    CEO Gary Bowman attributed Transportation growth to synergies from recent acquisitions and robust public spending, highlighting wins in construction management and highway design. He also noted that the geospatial group's recent wins are driving the energy transmission business. CFO Bruce Labovitz explained that operating leverage is primarily driven by disciplined labor management and investments in innovation to scale revenue faster than headcount.

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    Aaron Spychalla's questions to Bowman Consulting Group (BWMN) leadership • Q1 2025

    Question

    Aaron Spychalla inquired about the Transportation segment's order timing, the impact of IIJA funding, key growth drivers in the Power segment, and the current M&A market environment, including valuations.

    Answer

    Executive Gary Bowman explained that Transportation orders are naturally lumpy but the outlook remains strong, supported by IIJA, gas tax, and state funds. He identified data centers and grid modernization as key drivers for the Power segment. Regarding M&A, Bowman described the pipeline as active and competitive, with a focus on larger targets. CFO Bruce Labovitz added that Transportation's backlog value is up, indicating strong momentum, and noted the company is also pursuing non-acquisition 'acqui-hires' to add talent.

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    Aaron Spychalla's questions to Bowman Consulting Group (BWMN) leadership • Q4 2024

    Question

    Aaron Spychalla inquired about the impact of the Infrastructure Investment and Jobs Act (IIJA) on the transportation vertical, the nature of the current backlog and its visibility compared to past years, and for details on planned investments in technology and service line expansions.

    Answer

    CEO Gary Bowman confirmed that IIJA spending is accelerating and transportation trends are strong. CFO Bruce Labovitz noted the backlog's characteristics are stable, with a typical 80% turn profile within 12 months and no significant delays. Regarding technology, Gary Bowman highlighted investments in remote sensors, LiDAR/SONAR asset management products, and digital twinning tools. Bruce Labovitz added that these investments are strategically tied to revenue generation and margin enhancement, and the company has the balance sheet to support them.

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    Aaron Spychalla's questions to Bowman Consulting Group (BWMN) leadership • Q3 2024

    Question

    Aaron Spychalla from Craig-Hallum asked for an update on the transportation project pipeline, the impact of IIJA funding, and management's perspective on how the recent election results might affect Bowman's business.

    Answer

    Executive Gary Bowman and CFO Bruce Labovitz described the transportation pipeline as robust and expanding, driven by acquisitions like ExelTech, the addition of new services like bridge design, and leveraging Surdex's aerial survey capabilities for state DOTs. Regarding the election, Gary Bowman expressed cautious optimism, foreseeing potential benefits from a more favorable regulatory environment for fossil fuels and mining, while expecting infrastructure spending to remain stable. He also noted a potential increase in public-private partnership (PPP) projects.

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    Aaron Spychalla's questions to NPK International (NPKI) leadership

    Aaron Spychalla's questions to NPK International (NPKI) leadership • Q2 2025

    Question

    Asked about the impact of longer contract durations on the business and margins, and questioned if the full-year guidance implies second-half softness, seeking clarity on the puts and takes.

    Answer

    Longer contract durations are a positive trend driven by large transmission projects, which increases asset utilization and helps margins despite slightly lower service revenues. The second-half guidance accounts for typical Q3 seasonality and more conservative expectations for product sales, which were exceptionally strong in the first half.

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    Aaron Spychalla's questions to NPK International (NPKI) leadership • Q2 2025

    Question

    Aaron Spychalla inquired about the trend of longer contract durations, its impact on business visibility and margins, and whether this trend is expected to continue. He also asked for clarification on the implied softness in the second-half guidance and the key factors influencing the high and low ends of the range.

    Answer

    President and CEO Matthew Lanigan confirmed that longer-duration projects, driven by large transmission work, are increasing, which boosts asset utilization and positively impacts margins. SVP & CFO Gregg Piontek explained the second-half guidance reflects typical Q3 seasonality and more conservative expectations for product sales compared to the strong first half, while still representing healthy year-over-year growth.

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    Aaron Spychalla's questions to NPK International (NPKI) leadership • Q2 2025

    Question

    Aaron Spychalla of Craig-Hallum asked about the trend of longer contract durations, their impact on business visibility and margins, and whether this dynamic is expected to continue. He also inquired about the implied softness in the second-half guidance and the potential for conservatism.

    Answer

    President and CEO Matthew Lanigan confirmed that NPKI is seeing more long-duration projects, particularly in transmission, which boosts asset utilization and positively impacts margins. SVP & CFO Gregg Piontek clarified that the second-half guidance accounts for typical Q3 seasonality and the less predictable nature of product sales compared to the strong first half, while still reflecting healthy year-over-year growth.

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    Aaron Spychalla's questions to NPK International (NPKI) leadership • Q2 2025

    Question

    Aaron Spychalla inquired about the trend of longer contract durations, its impact on business visibility and margins, and whether this trend is expected to continue. He also asked for clarification on the second-half guidance, which implies some softness, and the key factors influencing the high and low ends of the range.

    Answer

    President and CEO Matthew Lanigan confirmed that the company is seeing more long-duration projects, particularly in the transmission sector, which increases asset utilization and positively impacts margins. SVP & CFO Gregg Piontek explained that the second-half guidance accounts for typical Q3 seasonality and more conservative expectations for product sales compared to the strong first half, while still representing healthy year-over-year growth.

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    Aaron Spychalla's questions to Orion Group Holdings (ORN) leadership

    Aaron Spychalla's questions to Orion Group Holdings (ORN) leadership • Q2 2025

    Question

    Aaron Spychalla inquired about the drivers behind the opportunity pipeline's growth to $18 billion, the conversion timeline for orders, the data center outlook for the Concrete segment, and the prospects for free cash flow conversion in the second half of the year.

    Answer

    CEO Travis Boone attributed the pipeline growth to some private sector clients delaying project awards from Q2 into the second half of the year due to economic uncertainty. He noted that while the data center market remains strong, there is new competition, but Orion's client relationships remain a key advantage. CFO Alison Vasquez added that despite working capital usage in Q2, cash collections improved in July, and she expects a strong second half for cash flow.

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    Aaron Spychalla's questions to Orion Group Holdings (ORN) leadership • Q1 2025

    Question

    Aaron Spychalla inquired about the timing and potential size of upcoming defense and shipbuilding contract awards, the business outlook and margin expansion goals for the Concrete segment, and activity levels in private downstream energy markets.

    Answer

    CEO Travis Boone stated that major defense awards are expected in late 2025 or early 2026, with several pursuits in the $500 million range. He confirmed the Concrete business has not seen a slowdown and noted increased bullishness from petrochemical clients. CFO Scott Thanisch added that growing volume and operating leverage are expected to drive margin improvement in the Concrete segment.

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    Aaron Spychalla's questions to Orion Group Holdings (ORN) leadership • Q4 2024

    Question

    Aaron Spychalla asked for color on the Q4 revenue shortfall against guidance, the company's confidence in its 2025 outlook, and the drivers behind the significant pipeline expansion to $16 billion. He also inquired about the current bidding environment and the timing of large Navy projects in relation to the 2026 growth forecast.

    Answer

    CEO Travis Boone explained that the 2024 revenue shortfall was due to project timing shifts, specifically a Hawaii project moving into 2025, not lost work. He affirmed confidence in the 2025 guidance and the strategy to build backlog for significant growth in 2026. Boone attributed the pipeline growth to strong opportunities in data centers and Navy projects in the Pacific. CFO Scott Thanisch added that the large pipeline allows for selectivity and supports a favorable margin environment.

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    Aaron Spychalla's questions to Orion Group Holdings (ORN) leadership • Q3 2024

    Question

    Aaron Spychalla of Sidoti & Co. inquired about the current bidding environment and backlog, the progression of opportunities with the U.S. Navy, and the company's capital expenditure outlook.

    Answer

    Executive Travis Boone described the bidding environment as strong and steady, with significant pursuits lined up for Q1 2025. He noted that major Navy opportunities are now expected later in 2025. CFO Scott Thanisch added that the company anticipates increased CapEx spending to acquire equipment for future growth, supported by a strong balance sheet.

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    Aaron Spychalla's questions to CECO ENVIRONMENTAL (CECO) leadership

    Aaron Spychalla's questions to CECO ENVIRONMENTAL (CECO) leadership • Q2 2025

    Question

    Aaron Spychalla of Craig-Hallum Capital Group LLC asked for more detail on the large industrial project opportunities outside of power generation, including their end markets and geographies, and questioned the potential impact of recent legislation on project momentum.

    Answer

    CFO Peter Johansson detailed a significant number of large opportunities (over $50 million each) in industrial water projects across the Middle East, India, and Southeast Asia. He also noted a resurgence in buying cycles for semiconductors, beverage can manufacturing, and metals processing. Both executives stated that while helpful, recent legislation is not the primary growth driver, with CEO Todd Gleason emphasizing he is more focused on the company's "big beautiful backlog."

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    Aaron Spychalla's questions to CECO ENVIRONMENTAL (CECO) leadership • Q1 2025

    Question

    Aaron Spychalla asked for a high-level overview of CECO's capital expenditure plans and investment areas for 2025 and beyond, and questioned the potential impact of increased defense spending on the company's business.

    Answer

    Peter Johansson (executive) identified IT infrastructure, specifically the standardization onto a single Microsoft D365 ERP platform, as the largest investment priority through 2026. He noted that traditional CapEx remains modest. Regarding defense, Johansson explained the benefits are both indirect, from new factory construction, and direct, through technology supplied to the Navy. Todd Gleason (executive) added that the high-specification work for naval applications is similar to their work in the nuclear sector, which saw strength in Q1.

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    Aaron Spychalla's questions to CECO ENVIRONMENTAL (CECO) leadership • Q4 2024

    Question

    Aaron Spychalla from Craig-Hallum Capital Group asked about the visibility the year-end backlog provides for 2025 guidance and how project timing is factored in. He also requested details on 2025 margin progression and the potential impact of tariffs.

    Answer

    Todd Gleason, CEO, stated that the record backlog provides significant confidence and visibility for 2025 guidance, a stronger position than entering 2024. Peter Johansson, CFO, added that gross margins have room for moderate expansion, while EBITDA margins should see accelerated improvement from scale and productivity. Regarding tariffs, Gleason noted the direct financial impact is expected to be manageable, with the primary concern being potential market uncertainty, which has not yet materialized.

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    Aaron Spychalla's questions to CECO ENVIRONMENTAL (CECO) leadership • Q3 2024

    Question

    Aaron Spychalla questioned management's confidence in the timing of delayed project revenue, the reasons for the wider 2025 guidance, and the company's capacity to manage its growing backlog.

    Answer

    CEO Todd Gleason expressed confidence that delayed projects will be realized, attributing the wider 2025 guidance range to the variable timing of when this backlog converts to revenue (either late Q4 2024 or early 2025). He and CFO Peter Johansson affirmed they have the necessary capacity, explaining they are carefully managing resources and qualifying new fabrication partners to ensure supply chain flexibility.

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    Aaron Spychalla's questions to DAKTRONICS INC /SD/ (DAKT) leadership

    Aaron Spychalla's questions to DAKTRONICS INC /SD/ (DAKT) leadership • Q4 2025

    Question

    Aaron Spychalla inquired about the revenue growth outlook for fiscal 2026, the levers available to manage margins amid tariff uncertainty, progress in expanding the AV integrator network within the Commercial segment, and future plans for working capital and capital allocation.

    Answer

    Brad Wiemann, EVP, Interim President & CEO, stated that fiscal 2026 growth is on track to align with the company's 7-10% CAGR target. He also detailed margin levers including value-based pricing, operational cost reductions, and new services. Regarding the Commercial segment, Wiemann highlighted significant growth opportunities in the AV integrator space. Howard Atkins, Acting CFO, added that the primary use of capital is for profitable growth and product development, with share repurchases also being a key consideration.

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    Aaron Spychalla's questions to DAKTRONICS INC /SD/ (DAKT) leadership • Q3 2025

    Question

    Aaron Spychalla inquired about the specific reasons for delays in order bookings, the potential impact of tariffs on Daktronics versus its competitors, the growth drivers and market penetration in the High School segment's shift to digital video boards, and the company's high-level capital allocation priorities given its strong balance sheet.

    Answer

    Reece A. Kurtenbach (Chairman, President and CEO) explained that booking delays are primarily due to the natural lumpiness of large projects and that current quoting activity remains strong. Regarding tariffs, he noted that Daktronics, as a U.S. manufacturer, has already been paying tariffs on components, suggesting new broader tariffs on finished goods from China might impact competitors more significantly. He described the High School market as a wide-open opportunity, with fewer than 10% of schools having converted to video. On capital allocation, he stated the board reviews options quarterly, including CapEx, tuck-in M&A, and direct shareholder returns like buybacks.

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    Aaron Spychalla's questions to LSI INDUSTRIES (LYTS) leadership

    Aaron Spychalla's questions to LSI INDUSTRIES (LYTS) leadership • Q3 2025

    Question

    Aaron Spychalla inquired about the fluctuating customer demand schedules, the specific margin impact on the Display Solutions segment, and the company's strategy for managing potential tariffs.

    Answer

    CEO Jim Clark identified the grocery vertical as the primary source of demand fluctuations but noted that schedules are stabilizing. CFO Jim Galeese quantified the temporary gross margin impact from these inefficiencies at 200-250 basis points, which he expects to recover. Regarding tariffs, Clark explained that LSI's strategy involves leveraging its domestic manufacturing, using existing inventory as a buffer, and having alternative sourcing plans ready, while passing on real cost impacts to customers as they occur.

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    Aaron Spychalla's questions to LSI INDUSTRIES (LYTS) leadership • Q2 2025

    Question

    Aaron Spychalla inquired about the business outlook for the second half of the fiscal year, potential Q3 seasonality, the trajectory for gross and EBITDA margins, and the possible impact of proposed tariffs on the business.

    Answer

    President and CEO James Clark explained that while it's difficult to distinguish between a temporary surge and a new run rate in the Grocery segment, he anticipates elevated activity will continue through Q3 and Q4. He noted that margins were impacted by ramp-up inefficiencies, the integration of the lower-margin EMI business, and costs from hedging against port strikes, but expects gradual improvement. Both Clark and CFO James Galeese emphasized that LSI's domestic manufacturing focus (70% domestic sourcing) and proactive contingency planning should mitigate the impact of any potential tariffs, positioning them favorably against competitors.

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    Aaron Spychalla's questions to LSI INDUSTRIES (LYTS) leadership • Q1 2025

    Question

    Aaron Spychalla inquired about the progress of major C-store program rollouts, the overall pipeline strength, updates on refrigerated case pilots in C-stores and QSRs, and the early commercial and cost synergies from the EMI acquisition.

    Answer

    President and CEO James Clark confirmed the C-store backlog would carry the company through fiscal 2025 and that pilot programs for the new R290 refrigerated solutions have been successful, becoming the standard from January 1. Regarding the EMI acquisition, Clark highlighted strong commercial introductions and operational improvements, expecting years of synergy harvesting. Executive James Galeese added that multiple C-store chains have shown strong acceptance of their new display units.

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    Aaron Spychalla's questions to NR leadership

    Aaron Spychalla's questions to NR leadership • Q4 2023

    Question

    Asked about the specifics of Q4 project push-outs in the Industrial business, the current sales pipeline, the drivers of 2024 margin guidance, the performance and outlook for the Fluids business, the 2024 free cash flow forecast, and the progress of the 800 Series product launch.

    Answer

    Executives clarified that Q4 project delays were due to two specific, non-systemic issues (supply chain and permitting). The quote pipeline shows strong mid-to-high teens growth. 2024 margin guidance reflects a shift to more volume-driven growth from longer-duration projects with competitive pricing. The Fluids business performance is driven by strong international operations (70% of revenue) offsetting U.S. softness. Free cash flow is expected to be solid for the year but muted in Q1. The 800 Series product is performing well in the internal fleet before a broader customer rollout.

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