Insituform Technologies, Inc., Q4 2008 Earnings Call Transcript

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2009-02-27 15:12:18.0

Tags: Revenue, Backlog, Call Transcript, Earnings, Insituform Technologies Inc., Operational Accounting, Finance, Seeking Alpha

Question-and-Answer Session

Operator

Thank you Mr. Burgess. (Operator Instructions). We will take our first question from Arnie Ursaner at CJS Securities.

Arnold Ursaner - CJS Securities

It's Arnie Ursaner with CJS Securities, good morning. The one question I have relates to your two acquisitions, I know you don’t intend to give more formal views till later in the year, but a very simple straight forward question if I can. Are you assuming both will be up in revenue and in 2009 versus the 2008 levels given their backlog? And you mentioned some margin numbers there a little bit different than some of the things in your public filings. But the broader question would be, do you expect 2009 margins in each of these businesses to be higher than the levels in 2008.

Joe Burgess

Arnie, this is Joe. We basically and we stated this when we were on the road talking about these investments, we do not expect the top-line revenue for these businesses to meet their 2008 record last 12 months levels. Corrpro we expect to just see a modest decline. Bayou while they have a record backlog and a pretty robust pipeline, we took that top-line for that business down about 8%.

Arnold Ursaner - CJS Securities

Okay. And if revenues are down to that magnitude given our energy exposure what sort of margin profile might we look for relative to the 2008 levels.

Joe Burgess

About the same, we didn’t really see, when we were doing to due-diligence on their pipeline, there was certainly some re-pricing going on, on some of the large pipeline projects, but that fell mainly in the cost of materials related to steel. And so we really, we did not see any margin pinch on the quoting side of the equation.

Arnold Ursaner - CJS Securities

Okay. Thank you very much.

Joe Burgess

You're welcome. Thank you.

Operator

And we will go next to Debra Coy with Janney.

Debra Coy - Janney Montgomery Scott

Thank you. Good morning, Joe.

Joe Burgess

Hi, Debra.

Debra Coy - Janney Montgomery Scott

Following up on the Bayou and Corrpro outlook, you mentioned in your opening remarks about the backlog and the characterization of it, two-third maintenance is related for Corrpro and one-third for Bayou. Can you just wrap a little bit more color around what's driving that, what the customers are spending money on that you think those have less exposure to the downturn in CapEx funding that operation?

 

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