Northwest Pipe Company Q1 2008 Earnings Call Transcript

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2008-04-28 15:34:07.0

Tags: Northwest Pipe Co.

Question-and-Answer Session

Operator

Thank you. (Operator Instructions). Our first question today comes from Ryan Connors of Boenning & Scattergood.

Ryan Connors - Boenning & Scattergood

Good morning.

Brian Dunham

Good morning.

Ryan Connors - Boenning & Scattergood

Brian, I had a couple of questions. First off, I kind of wanted to touch on the Tubular business first, actually. I know there's been a lot of talk about the shift toward the ISS group in terms of being the new distribution channel and obviously that was part of the growth, the sequential growth there. If you could just update us on where we are in that process of sort of re-ramping the energy-related volumes, vis-à-vis ISS -- LSS?

Brian Dunham

Yeah. LSS. Thank you. Because I'm sitting here going ISS, Ryan, what are we talking about? LSS, and they changed their name, and I apologize. I don't have it off the tip of my tongue, but they have a different name in that now. But they are definitely off and running. I think it is Tubular Sales Group, TSG, I think is the name of it now. They are definitely off and running and booking orders for us and we are clearly seeing an increase in the energy side of the business in Q1 over Q4, and we expect that to continue to be pretty strong.

Ryan Connors - Boenning & Scattergood

Okay. And then just more generally, I mean you talked in your comments about the margin improvement in Tubular Products being based in large part on volume growth. But I know in the past, you've talked about trying to move that business toward some of the more differentiated products, whether it be in traffic applications or agricultural applications. If you can just give us an update on where we are in that segment from a mix standpoint and sort of how we are progressing in that sort of transition of the product mix?

Brian Dunham

I think that transition is in effect at this point in time and essentially complete. Over the last two years, Ryan, we have hit the double-digit margins, seven out of eight quarters and that's really a result of making that transition. As we look ahead now, we see the opportunity obviously for a higher volume, so better utilization of our facilities, and also, of course, we are seeing price changes as we go forward.

Ryan Connors - Boenning & Scattergood

 

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