Willdan Group, Inc. (NASDAQ:WLDN) Q4 2022 Earnings Call Transcript

Chip Moore: Yes. No, that’s fair.

Michael Bieber: Counterintuitive, they had a very strong Q4 and are entering 2023, the first couple of months better than ever. So it has not translated into any sort at all right now.

Chip Moore: That’s helpful. And maybe if I sneak 1 in, I think, back to as it relates to IRA and some of the tailwinds. I think you mentioned the growth you’re seeing at E3 and how they’re sort of your leading indicator on future direction? Just maybe expand on that and maybe where some of that direction might be?

Thomas Brisbin: Well, this clean energy economy, transition, grid modification whatever you want to call it, climate change, E3 is the leading, let’s call it technical consulting for probably in the nation. I mean, they are the ones that they call these calls, where is the world going, how do I get there? And they are betting a lot on this electrification. We’ve got to reduce our EE, energy efficiency. We have to electrify. They see this money as being enough as you stack it on the utility sets and settle money enough to get the market to move to a clean energy economy. Now that is a 10-year deal. And where do we fit into that and how do we capture that is what we’re working on. And we like where we are. I mean we like working for the utilities, the private sector, the cities.

And we have probably a deep understanding of where this transition is going because of what E3 does, and I call it the practice we’ve been doing for the last 6, 7, 8 years. It’s really got us a lot smarter. We understand the customers what they need, and there’s a lot of confusion in the market what it means. I mean, they get called on by the vendors selling them up in every minute on how to get better, cheaper, faster, less carbon. So we’re ready for it. I won’t say completely right, but we’re in pretty good shape.

Operator: . Our next question comes from Marc Riddick with Sidoti.

Marc Riddick: So I was wondering if you could touch a little bit about the — what we should be thinking about sort of how the amendment would — is there sort of any lumpiness into sort of where those changes would appear throughout the year. As well as then as a follow-up, I know that there had been the hiring ramp up going into everything through the year, most of which was done early in ’22. Should we be thinking about anything different as far as any headcount changes that may come from that? Or are you kind of where you need to be with the human capital there?

Michael Bieber: Marc, the amendment has been signed is finalized with SCE. And there should be no lumpiness associated with it actually, just the opposite, it should remove the lumpiness out of those contracts. So a pretty steady, slow ramp throughout the year on the California IOU work. Likewise, on hiring across the company, pretty slow, steady hiring throughout the year. not any major obstacle that we have to face in 2023.

Marc Riddick: Okay. Great. And then as far as the time frame as to maybe what you might be seeing as far as a pickup in some of the potential pipeline from the funding environment on state and local government levels. Could you talk a little bit about maybe is there a type of — are there any changes in the types of projects that you’re seeing? Or are there any particular ones that are kind of at the forefront of picking up demand relatively sooner rather than later relative to some of the other services that you may provide?