nwpx20230630

nwpx20230630_10q.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended: June 30, 2023

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from _______to _______

Commission File Number: 0-27140

NORTHWEST PIPE COMPANY

(Exact name of registrant as specified in its charter)

Oregon	93-0557988
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

201 NE Park Plaza Drive, Suite 100

Vancouver, Washington 98684

(Address of principal executive offices and Zip Code)

360‑397‑6250

(Registrant’s telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.01 per share	NWPX	Nasdaq Global Select Market

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S‑T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b‑2 of the Exchange Act.

Large accelerated filer	☐	Accelerated filer	☒
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b‑2 of the Exchange Act). Yes ☐ No ☒

The number of shares outstanding of the registrant’s common stock as of July 25, 2023 was 10,014,196 shares.

Table of Contents

NORTHWEST PIPE COMPANY

FORM 10‑Q

TABLE OF CONTENTS

	Page
PART I - FINANCIAL INFORMATION

Item 1. Financial Statements (Unaudited):

Condensed Consolidated Statements of Operations for the three and six months ended June 30, 2023 and 2022	2

Condensed Consolidated Statements of Comprehensive Income for the three and six months ended June 30, 2023 and 2022	3

Condensed Consolidated Balance Sheets as of June 30, 2023 and December 31, 2022	4

Condensed Consolidated Statements of Stockholders’ Equity for the three and six months ended June 30, 2023 and 2022	5

Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2023 and 2022	7

Notes to Condensed Consolidated Financial Statements	8

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	20

Item 3. Quantitative and Qualitative Disclosures About Market Risk	26

Item 4. Controls and Procedures	27

PART II - OTHER INFORMATION

Item 1. Legal Proceedings	28

Item 1A. Risk Factors	28

Item 5. Other Information	28

Item 6. Exhibits	28

Signatures	30

Table of Contents

Part I – FINANCIAL INFORMATION

Item 1. Financial Statements

NORTHWEST PIPE COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(In thousands, except per share amounts)

	Three Months Ended June 30,						Six Months Ended June 30,
	2023			2022			2023			2022

Net sales	$	116,372		$	118,522		$	215,469		$	227,853
Cost of sales		93,891			94,442			176,411			188,987
Gross profit		22,481			24,080			39,058			38,866
Selling, general, and administrative expense		11,016			10,127			22,882			19,495
Operating income		11,465			13,953			16,176			19,371
Other income (expense)		(134	)		1			(163	)		45
Interest expense		(1,191	)		(869	)		(2,560	)		(1,429	)
Income before income taxes		10,140			13,085			13,453			17,987
Income tax expense		2,692			3,412			3,643			4,755
Net income	$	7,448		$	9,673		$	9,810		$	13,232

Net income per share:
Basic	$	0.74		$	0.98		$	0.98		$	1.34
Diluted	$	0.74		$	0.97		$	0.97		$	1.33

Shares used in per share calculations:
Basic		10,000			9,918			9,970			9,900
Diluted		10,066			9,968			10,081			9,971

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

NORTHWEST PIPE COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)

(In thousands)

	Three Months Ended June 30,						Six Months Ended June 30,
	2023			2022			2023			2022

Net income	$	7,448		$	9,673		$	9,810		$	13,232

Other comprehensive income (loss), net of tax:
Pension liability adjustment		30			22			59			44
Unrealized loss on foreign currency forward contracts designated as cash flow hedges		(123	)		(96	)		(101	)		(403	)
Unrealized gain (loss) on interest rate swaps designated as cash flow hedges		85			233			(93	)		233
Other comprehensive income (loss), net of tax		(8	)		159			(135	)		(126	)
Comprehensive income	$	7,440		$	9,832		$	9,675		$	13,106

The accompanying notes are an integral part of these condensed consolidated financial statements.

Table of Contents

NORTHWEST PIPE COMPANY AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Unaudited)

(Dollar amounts in thousands, except per share amounts)

	June 30, 2023			December 31, 2022
Assets
Current assets:
Cash and cash equivalents	$	4,152		$	3,681
Trade and other receivables, less allowance for doubtful accounts of $434 and $369		63,419			71,563
Contract assets		122,359			121,778
Inventories		84,579			71,029
Prepaid expenses and other		4,919			10,689
Total current assets		279,428			278,740
Property and equipment, less accumulated depreciation and amortization of $121,722 and $117,856		137,506			133,166
Operating lease right-of-use assets		91,106			93,124
Goodwill		55,504			55,504
Intangible assets, net		33,160			35,264
Other assets		6,034			5,542
Total assets	$	602,738		$	601,340

Liabilities and Stockholders’ Equity
Current liabilities:
Current debt	$	10,756		$	10,756
Accounts payable		26,721			26,968
Accrued liabilities		25,770			30,957
Contract liabilities		26,990			17,456
Current portion of operating lease liabilities		4,887			4,702
Total current liabilities		95,124			90,839
Borrowings on line of credit		70,069			83,696
Operating lease liabilities		87,789			89,472
Deferred income taxes		11,834			11,402
Other long-term liabilities		9,321			7,657
Total liabilities		274,137			283,066

Commitments and contingencies (Note 7)

Stockholders’ equity:
Preferred stock, $.01 par value, 10,000,000 shares authorized, none issued or outstanding		-			-
Common stock, $.01 par value, 15,000,000 shares authorized, 10,014,196 and 9,927,360 shares issued and outstanding as of June 30, 2023 and December 31, 2022, respectively		100			99
Additional paid-in-capital		128,562			127,911
Retained earnings		200,863			191,053
Accumulated other comprehensive loss		(924	)		(789	)
Total stockholders’ equity		328,601

SEC Form 10-Q filed by Northwest Pipe Company