Limbach Q3 Earnings Call Highlights

Key Points

• Record quarterly results: Revenue rose 25% year over year to $230.5 million, while adjusted EBITDA reached a record $27.4 million. Owner-direct revenue returned to organic growth, and bookings of about $311 million exceeded revenue for the fourth straight quarter.
• Acquisitions broaden capabilities: CYMCOR adds program management and commissioning expertise, including in data centers, while 1901 expands Limbach’s Midwest presence and electrical operations. Both acquisitions contributed revenue in the quarter, with fuller contributions expected in 2027.
• Outlook maintained: Limbach said it is tracking near the high end of its full-year revenue and adjusted EBITDA guidance but kept its ranges unchanged, citing fourth-quarter execution. The company reported $164.2 million in liquidity after acquisitions and repurchased nearly 200,000 shares for about $10 million.

Limbach NASDAQ: LMB reported record third-quarter revenue and adjusted EBITDA as owner-direct customer activity returned to organic growth, bookings remained ahead of revenue, and the company added two businesses intended to broaden its technical capabilities and geographic reach.

Third-quarter revenue rose to $230.5 million from $184.6 million a year earlier. Net income increased to $9.5 million, or $0.79 per diluted share, from $8.8 million, or $0.73 per diluted share, in the prior-year period. Adjusted EBITDA reached a record $27.4 million, compared with $21.8 million a year ago.

Chief Executive Officer Mike McCann said the company’s results reflected progress against its strategy of growing “quality revenue” through building systems solutions. Limbach reported total organic growth of 6.6%, including 2.2% organic growth in its owner-direct revenue, or ODR, business.

Bookings and Owner-Direct Activity Improve

Bookings totaled about $311 million in the quarter, producing a book-to-bill ratio of about 1.4 times. McCann said this marked Limbach’s fourth consecutive quarter in which bookings exceeded revenue.

The company said customer budget decisions and project-release timing had been difficult to predict during the first half of 2026, particularly in its healthcare and institutional markets. However, management said it saw timing issues begin to resolve during the third quarter, providing greater visibility into customer spending as the company enters the fourth quarter.

McCann said Limbach has been working with two of its largest national healthcare customers on solutions expected to move from bookings into revenue during the fourth quarter. He said the company remains focused on converting bookings into revenue and executing projects as customer spending traditionally picks up late in the year.

Management also pointed to investments in its sales organization, including national vertical-market teams focused on healthcare and data centers. McCann said the national teams and local operations are intended to improve visibility into customer spending habits while helping Limbach support customers across multiple locations.

Acquisitions Expand Electrical and Data Center Capabilities

During the quarter, Limbach completed the acquisition of CYMCOR in August and Wisconsin-based 1901 in September. Management said both businesses contributed acquisition-related revenue during the quarter and will provide fuller contributions in 2027.

McCann said 1901 expands Limbach’s Midwest presence and establishes its largest electrical operation. The acquired business adds mechanical, plumbing, controls, fabrication and service capabilities, as well as approximately 450 employees, including more than 350 field professionals. Limbach said 1901 also adds exposure to advanced manufacturing, life sciences and technology markets.

The company said it expects to preserve 1901’s local relationships and experience while connecting the operation with Limbach’s broader platform. McCann acknowledged that acquisitions can affect consolidated gross-margin percentages because of differing customer and project mixes, even when they add gross profit and earnings. He said Limbach sees an opportunity to improve 1901’s margins over time through customer relationships, expanded service offerings, project practices and pricing discipline.

CYMCOR adds program management, commissioning oversight and strategic consulting capabilities, according to management. McCann said the acquisition gives Limbach earlier access to owners’ planning processes in mission-critical markets, including data centers.

While data center construction has attracted substantial industry attention, McCann said Limbach intends to remain selective, pursuing work with attractive economics and manageable risk. The company said its fabrication capacity may support selected data center packages, while CYMCOR’s professional-services work could provide higher-margin revenue and insight into customer needs.

Management emphasized that its goal is not solely to participate in initial construction activity. It also seeks service, maintenance, retrofit and upgrade opportunities once facilities are operating.

Margins, Cash Flow and Capital Allocation

Third-quarter gross margin was 23.4%, while selling, general and administrative expenses were 15% of revenue. Chief Financial Officer Jayme Brooks said those trends were consistent with the operating plan reviewed during the company’s assessment of its full-year outlook.

For the first nine months of 2026, Limbach reported revenue of $542.8 million, net income of $18.6 million and adjusted EBITDA of $50 million.

The company generated $31.2 million in operating cash flow during the first nine months. Its company-defined free cash flow totaled $43.6 million, representing 87.1% of adjusted EBITDA; Limbach said this measure excludes changes in working capital.

After funding the CYMCOR and 1901 acquisitions, Limbach had total liquidity of $164.2 million as of Sept. 30. Net debt was approximately 1.6 times reported trailing 12-month adjusted EBITDA.

During the quarter, Limbach repurchased nearly 200,000 shares for approximately $10 million, at an average price of $51.31 per share. Brooks said the company’s capital-allocation focus remains on acquisitions that fit its strategy, while also being opportunistic with share repurchases.

Full-Year Outlook Maintained

Limbach said it is tracking at or near the high end of its previously published full-year revenue and adjusted EBITDA guidance ranges, including contributions from CYMCOR and 1901. Management did not raise the ranges, saying the company is in the middle of a significant fourth quarter and remains focused on execution.

McCann said the company’s remaining 2026 priorities are to convert backlog, sustain bookings momentum, improve project performance, integrate its recent acquisitions and deploy more of its fabrication capacity. Looking toward 2027, he said Limbach sees potential growth from recovering owner-direct activity, broader market exposure, geographic expansion and the full-year contributions of CYMCOR and 1901.

About Limbach (NASDAQ:LMB)

Limbach Holdings, Inc NASDAQ: LMB provides integrated building systems solutions through its operating subsidiaries, including Limbach Facility Services. The company designs, installs, maintains and services critical mechanical, electrical, plumbing and building automation systems for commercial and institutional facilities.

Limbach's services include heating, ventilation and air conditioning; plumbing and piping; building controls and automation; energy and sustainability solutions; facility maintenance; and related repair, replacement and retrofit work.

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