Nicholas Giles

Nicholas Giles inquired about the factors that could push AZZ's adjusted EBITDA guidance to the higher end of the range, distinguishing between end-market and operational drivers. He also asked about the incremental EBITDA contribution from the Washington facility's ramp-up and potential capital-intensive margin expansion opportunities within the Metal Coatings segment.

Answer

Tom Ferguson, President and CEO, attributed the EBITDA impact primarily to the AVAIL joint venture's transition, noting potential upside from a strong fall season for WSI, continued interest savings, and potential galvanizing acquisitions. He also highlighted Precoat's sustained margins and Metal Coatings' focus on 30-31% margins despite higher growth in slightly lower-margin solar/T&D projects. Jason Crawford, SVP and CFO, confirmed Washington, Missouri was a margin drag in H1 but is on track to turn positive in H2, with production ramping to 50% capacity by Q4, aligning with original guidance. He also mentioned multiple incremental projects for margin expansion across both businesses.

Nicholas Giles asked about the factors influencing AZZ's adjusted EBITDA guidance, distinguishing between end-market and operational drivers, and the incremental EBITDA contribution from the Washington, Missouri facility's ramp-up.

Answer

President and CEO Tom Ferguson cited the AVAIL EBITDA impact as the primary factor, with potential upsides from WSI's fall season, interest savings, and galvanizing acquisitions. He noted Precoat's margin targets and Metal Coatings' strong growth. SVP and CFO Jason Crawford detailed Washington, Missouri's $2 million H1 margin drag, expecting positive contributions as it reaches 50% capacity by Q4.