Total Revenue

+12% (from $119.0M to $133.1M)

The 12% increase in total revenue in Q1 2025 is driven by a continued strategic emphasis on high-margin Order-Driven Revenue (ODR), which builds on prior period trends of organic growth and targeted acquisitions. This upward shift in revenue mix, as seen previously, underscores the company’s commitment to growing its premium segment. " " " "

Operating Income

+21% (from $6,532K to $7,911K)

Operating income improved by 21% as a result of higher gross profit margins stemming from the increased share of ODR revenue and more efficient cost management. This improvement continues the momentum observed from earlier periods when the mix-shift strategy began yielding benefits. " "

Net Income

+35% (from $7,586K to $10,214K)

A 35% rise in net income reflects enhanced profitability driven by the shift towards revenue segments with higher margins, along with favorable tax adjustments and robust operational performance. This builds on previously improved margins and increased adjusted EBITDA, reinforcing the company’s strategic trajectory. " "

Order-Driven Revenue (ODR)

+22% (from $74.3M to $90.4M)

ODR revenue grew by 22%, illustrating the ongoing focus on expanding high-value, higher-margin customer relationships. This growth is rooted in the strategic initiatives previously executed, including targeted acquisitions and organic expansions, which have boosted the overall revenue mix. " " " "

Grid/Contract Revenue (GCR)

Declined modestly (from $44.7M to $42.7M)

GCR revenue experienced a modest decline, consistent with the company’s intentional mix-shift away from lower-margin projects towards more profitable ODR opportunities. This decrease follows the trend established in earlier periods where reducing emphasis on GCR was a deliberate strategic decision. " " " "

Cash and Cash Equivalents

–21% (from $48,239K to $38,090K)

Cash and cash equivalents dropped by approximately 21%, primarily due to significant outflows in both investing and financing activities. In Q1 2025, funds were allocated for property and equipment acquisitions (e.g., rental equipment purchases) and for financing obligations such as tax-related payments and lease settlements—a trend continuing from previous periods where acquisitions and working capital adjustments affected the liquidity position. " "

Revenue

FY 2025

$610 million to $630 million "

$610 million to $630 million "

no change

Adjusted EBITDA

FY 2025

$78 million to $82 million "

$78 million to $82 million "

no change

Free Cash Flow Conversion Rate

FY 2025

at least 70% "

at least 75% "

raised

CapEx

FY 2025

Approximately $4 million, excluding an additional investment of $3.5 million in rental equipment in the first half of 2025 "

Approximately $4 million, excluding an additional investment of $3.5 million in rental equipment for 2025 (with $2 million in Q1) "

no change

SG&A Expense

FY 2025

Around 18% to 19% "

18% to 19% "

no change

Gross Margin

FY 2025

no prior guidance

28% to 29% "

no prior guidance

Healthcare Market Strength

In Q4 2024 the healthcare vertical was described as the company’s largest and most significant market with strong recurring revenue relationships. " In Q3 2024 it was noted as one of the three key verticals with steady, mission‐critical demand. " In Q2 2024, healthcare was characterized as a stable, key vertical serving critical infrastructure. "

In Q1 2025, healthcare remains a key focus. The discussion now emphasizes its stability alongside a transition from short-term repairs to long-term capital planning to address deferred maintenance. "

Consistent focus with an evolving emphasis on deferred maintenance leading to strategic, long-term planning.

Deferred Maintenance

Q2 2024 highlighted “tremendous deferred maintenance” generating future capital projects. " Q4 2024 cited proactive engagement (e.g., the Philadelphia hospital example) for addressing deferred needs. " Q3 2024 implied deferred work through mission‐critical repair emphasis. "

Q1 2025 discusses deferred maintenance as a strategic shift from quick-repair solutions to long-term capital planning, noting that key healthcare customers are gearing toward future reinvestment. "

Moving from reactive fixes to a more strategic, long-term approach as customers plan to address longstanding deferred maintenance.

ODR Transformation

Q2 2024 reported that ODR revenue comprised 67.7% of total revenue with a clear focus on shifting from GCR. " In Q3 2024, ODR accounted for 69.4% of revenue with notable backlog growth and margin improvements. " Q4 2024 reiterated the emphasis on increasing the ODR share, supported by strong revenue growth and integration into the business model. "

In Q1 2025, ODR remains central with 67.9% of revenue, a 21.7% YoY growth rate, and projections that project its share to rise to 70%-80% for 2025. " "

A sustained positive trajectory with steady revenue growth and deeper integration into the company's strategic framework.

Long-Term Customer Relationship Development

Q2 and Q3 2024 calls detailed the deployment of on-site account managers, bundled offerings, and proactive facility assessments to deepen customer relationships. " " " Q4 2024 reinforced the long-term focus via strategic partnerships in key accounts. "

Q1 2025 continues to emphasize proactive customer engagement, employing facility assessments and tailored solutions to support long-term relationships. " "

Consistent emphasis on strengthening customer partnerships and leveraging data-driven insights, building on past initiatives.

Acquisition Strategy

Across Q2 2024, Q3 2024 and Q4 2024, a disciplined and measured approach to M&A was described, including targeted acquisitions for geographic expansion and strong cultural fits. " " "

Q1 2025 outlines an active pipeline with focused due diligence and plans to expand into additional MSAs along the East Coast and Midwest. " "

Stable and disciplined approach with a slight shift toward more geographic expansion.

M&A Integration Risks

Q2, Q3, and Q4 2024 discussions focused on integrating acquisitions into a common strategic platform and learning from past deals to manage risks effectively. " " "

Q1 2025 notes progress on recent integrations and emphasizes the continued importance of aligning acquisitions with long-term strategy to mitigate risks. "

Consistently managed through proactive integration measures with ongoing refinement of the process.

Margin Expansion

Q2 2024 reported a total gross margin of 27.4% driven by the ODR mix-shift. " In Q3 2024 margins increased to 27% with higher ODR contribution " , and Q4 2024 saw margins rise to 27.8%, partly from improved margins in both the ODR and selective GCR segments. "

In Q1 2025, margins further improved with consolidated gross margins at 27.6%, an 18.1% expansion in gross profit, and ODR contributions supporting the overall margin growth. " "

A steady improvement in margins reinforced by the continued success of the ODR strategy and a focus on higher-quality projects.

Recurring Revenue Growth

Q2 2024 highlighted significant growth in ODR revenue and an expanding backlog. " Q3 2024 emphasized durable recurring revenue through long-term contracts and increasing customer penetration. " Q4 2024 detailed bundled service contracts and recurring revenue from long-term relationships. "

Q1 2025 reported that recurring revenue via ODR now makes up 67.9% of total revenue with a 21.7% YoY increase and optimistic projections for an even higher share in 2025. " "

Robust and steadily growing, underscoring the strategic shift towards stable, recurring revenue streams.

Rental Equipment Investment

Q2 2024 noted a $4 million investment in rental equipment for indoor climate control, with similar focus in Q3 2024, where further investments were planned. " " " Q4 2024 did not offer specific details on rental equipment investments.

Q1 2025 confirmed a $2 million investment in climate control rental equipment, with plans for an additional $3.5 million investment later in 2025. " "

Ongoing targeted investments remain strong, though bundled service details tied to rentals were less emphasized in the current call.

Bundled Service Opportunities

Q2 2024 and Q3 2024 featured examples of bundled services combining engineering, maintenance, and consulting, particularly illustrated with healthcare clients. " "

No specific details on bundled service opportunities were provided in Q1 2025. " "

Not mentioned in the current period, suggesting a possible de-emphasis or integration into broader service offerings without distinct focus.

Data Center Presence

Q4 2024 described a focus on existing data center infrastructure in markets like Columbus and Northern Virginia. " In Q3 2024 and Q2 2024, the company underscored early-stage penetration and upgrades in the data center vertical. " " "

There was no discussion of data center presence in Q1 2025.

This topic is no longer mentioned, suggesting a deprioritization or integration into other strategic areas.

Expansion Challenges

Q4 2024 and Q3 2024 mentioned challenges related to expanding service offerings in new markets, particularly for data center work and geographically diversified accounts. " " Q2 2024 touched on existing infrastructure upgrades without highlighting significant challenges.

No mention of expansion challenges was made in Q1 2025.

The absence of discussion may indicate that expansion challenges are either being managed effectively or are no longer a focal concern.

Tariff Uncertainty

Not mentioned in Q2, Q3, or Q4 2024 earnings calls.

Q1 2025 introduced tariff uncertainty as a factor, noting that while tariffs have had a neutral effect so far, they are driving accelerated purchasing decisions as customers seek to lock in pricing. "

A newly emerging topic that is influencing purchasing behavior and could impact future project dynamics.

Macroeconomic Volatility

No discussion in Q2, Q3, or Q4 2024 earnings calls.

Q1 2025 addressed macroeconomic volatility, emphasizing the adaptability of the short-cycle, ODR-focused projects that help mitigate long-term impact. "

A new topic introduced in Q1 2025, highlighting the company’s focus on agility in a volatile economic environment.