Willdan Group, Inc. (WLDN) Earnings Call Transcript & Summary

Hello, and welcome to the Annual Meeting of Stockholders of Willdan Group. Please note that today's meeting is being recorded. [Operator Instructions] It is now my pleasure to turn today's meeting over to Kim Early, Chief Financial Officer of Willdan. Mr. Early, the floor is yours.

Thank you, and good morning, ladies and gentlemen. I want to welcome you and thank you for attending the 2021 Annual Meeting of Stockholders of Willdan Group, Inc. I am Kim Early, Chief Financial Officer. At this time, I call the meeting to order. The agenda for today's meeting is available for viewing on your screen during the webcast. The rules of conduct for this meeting can be accessed under the Meeting Materials section of the webcast. Stockholders who possess the control number and desire to ask a question during the meeting may do so by clicking the Message icon and typing the question into the appropriate box where indicated on the webcast portal for this meeting. We will respond to appropriate questions about the proposals being voted on today after all the proposals have been presented. Only stockholders who possess the control number will be permitted to ask questions. The polls are open, and you may vote by electronic ballot at any time during the annual meeting until the polls close. There are 3 items of business on today's agenda: One, the election of directors; two, the ratification of the appointment of Crowe LLP as the company's independent auditors for the 2021 fiscal year; and three, the approval on a nonbinding advisory basis of the company's named executive officer compensation. I will act as the secretary of this meeting. And I would like to take this opportunity to introduce the director nominees, officers and other invited guests of the company who are present on the call today. The directors: Tom Brisbin, Chairman and CEO; Steve Cohen, Lead Independent Director; Debra Coy; Ray Holdsworth; Doug McEachern; Dennis McGinn; Keith Renken; and Mohammad Shahidehpour. The officers, Mike Bieber, Daniel Chow, Paul Whitelaw, Micah Chen, and Adam Procell. And invited guests: Glenn Richards from Crowe, he will be available during the question-and-answer session to respond to appropriate questions; and Logan Tiari from O'Melveny & Myers. The Board of Directors has appointed Christine Abbey, a representative of Computershare Trust Company NA, to act as inspector of elections. She will tabulate the voting results for today's meeting. I have received an affidavit that on April 28, 2021, we began mailing the notice of Internet availability of proxy materials to all stockholders of record as of April 20, 2021, the record date for the meeting. A copy of the notice and affidavit will be included in the minutes of this meeting. The inspector of elections for this meeting has examined the proxies received and the register of the individuals present on this call and reports that holders of a majority of the shares of common stock outstanding on the record date are represented by presence or by proxies at this meeting. Therefore, a quorum is present and we may proceed with the business portion of our meeting. The voting procedures. The proposals to be voted on have been described in detail in the proxy statement. If you have already voted by proxy, by telephone, Internet or mail, and do not wish to change your vote, you do not need to vote here at the meeting. Your vote has already been recorded. If you provided a control number when you logged in and wish to vote while participating in this meeting. Or if you wish to revoke your proxy and change your vote, you should vote today by clicking on the Cast Your Vote link on the webcast portal and following the instructions. To vote at today's meeting, you must be the record owner of the shares you are voting as of April 20, 2021, which is the record date, or you must have a valid proxy from such record owner. If you intend to vote today at this meeting but are having technical difficulties with the webcast portal, please call toll free 1 (888)724-2416 for assistance. Please note that you will not be able to submit your vote via telephone. I will now proceed with introducing each of the items of business at today's meeting. You will have an opportunity to complete and submit your electronic ballot after all the items have been introduced. Item #1, the election of directors. The first item of business is the election of 8 directors. The Board of Directors has named in the proxy statement the following nominees for election as directors, each to serve until the 2022 Annual Meeting of Stockholders and until their respective successor is duly elected and qualified or until their earlier death, resignation or removal. Thomas D. Brisbin, Steven A. Cohen, Debra G. Coy, Raymond W. Holdsworth, Douglas J. McEachern, Dennis V. McGinn, Keith W. Renken and Mohammad Shahidehpour. Because no other nominations were received in accordance with the advanced notice provisions of our bylaws, all nominations are now closed. The Board of Directors recommend a vote for all of the Director nominees. Item #2, ratification of independent registered public accounting firm. The next item of business will be the ratification of the appointment by the Board of Directors of Crowe LLP as the company's independent registered public accounting firm for fiscal year 2021. Glenn Richards, representing Crowe LLP is present and available to answer appropriate questions. The Board of Directors recommend a vote for the ratification of the appointment of Crowe LLP as the company's independent registered public accounting firm for fiscal year 2021. And Item #3, approval on a nonbinding advisory basis of the company's named executive officer compensation. The final item of business will be considered the approval on a nonbinding advisory basis of the company's named executive officer compensation. The Board of Directors recommends a vote for the approval on a nonbinding advisory basis of the company's named executive officer compensation. That concludes the introduction of all matters requiring a stockholder vote today. We anticipate taking questions on the proposal for approximately 15 minutes. Are there any questions on any of the proposals? Seeing none. The polls are open. As stated earlier, if you have already submitted a proxy by telephone, Internet or mail, and do not wish to change your vote, you do not need to do anything else at this time. Any stockholder who hasn't yet voted or wishes to change his or her vote may do so by clicking on the Cast Your Vote link on the webcast portal and following the instructions. If you have not yet submitted a proxy or electronic ballot, you must submit your electronic ballot now in order for your vote to be counted by the inspector of elections. We will leave the polls open for approximately 2 more minutes to allow anyone who chooses to vote electronically to cast their ballots. I'll now pause to allow for that voting. [Voting]

Okay. Proposals must be made in advance of the meeting to be considered. Accordingly, the polls are now closed and voting on the matter set forth in the notice of annual meeting is now concluded. All ballots will now be counted by the inspector of elections. While the inspector of elections is counting the ballots and the proxies, we'll have our Chairman of the Board and Chief Executive Officer, Tom Brisbin, make a brief report to you about our company. Before hearing from Tom, I would like to remind everyone that he will be making some forward-looking statements today. Statements, which are not purely historical, including statements regarding the company's intentions, hopes, beliefs, expectations, representations, projections, estimates, plans or predictions on the future are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. The forward-looking statements involve risks and uncertainties, including, but not limited to, the risk that the company will not be able to expand its services, integrate its acquisitions or meet the needs of customers in markets in which it operates. It is important to note that the company's actual results could differ materially from those in any such forward-looking statements. The company's business could be affected by a number of factors and the risks included in the company's SEC filings, which may be increased or intensified as a result of the COVID-19 pandemic. Stockholders should review the risk factors included in the reports that the company files with the Securities and Exchange Commission, including but not limited to, the annual report on Form 10-K for the year ended January 1, 2021, filed with the SEC on March 17, 2021. The company cautions investors not to place undue reliance on the forward-looking statements made today. The company disclaims any obligation to and does not undertake to update or revise any forward-looking statements except as required by law. Tom?

Well, good morning, everyone, and good afternoon to those on the East Coast. This is a little bit different than, let's say, 3 years ago when we used to have an annual stockholder meeting over the local hotel here next to Anaheim. We served a little snack, somewhere between 10 and 15 people showed up. Generally, 12 of the 15 were employees, 3 were actual shareholders. And now we've gone to this virtual meeting, not -- we actually went to it before COVID. And now during COVID, it's become even more personal. We're used to these everyday meetings on Zoom, Webex, what's the latest where we just finished, Teams. I can't remember a lot, but thank you for joining. As I look at the list of the people, I don't even see your pictures because the system we're using doesn't even -- can't see you or you can't see us, I don't think. So I see maybe 2 or 3 people their names I don't recognize. The rest of them are either lawyers, accountants, stock counters whatever we call those. But for those who are on the call that are stockholders, I think I would have -- we'll ask you if you have any questions, but I would have 1 pressing question as a shareholder myself as well as many employees are shareholders, what has been the effect of COVID on our business and where do we stand today? And how are we going to emerge from it? As you know, if you've been following for the past 18 months, we were hit pretty hard initially. About 40% of our revenue decreased, primarily due to our work with investor-owned utilities across the nation, where we go to their customers and help them with energy efficiency. When COVID hit, we were no longer to make those sales to those people, interact with them and show them how to save energy. And most of the utility follows state regulation, federal regulation, as all of us, we're basically quarantined to our homes. Again, fortunately, for Willdan, that 60% remaining, we were able to do virtually from our homes. So we were -- we got through it, I would say, with a better than survival. I mean we financially met all our requirements with the banks, and we continue to make payroll for many, although we did have unfortunate layoffs and furloughs, and I extend my sympathies to those. We're trying to get everyone back. We've got most of them back. We're waiting for our last contract here in Los Angeles, the Los Angeles Department of Water and Power to reopen near the end of this month. And we hope to have everyone back to work nationwide and ramping not only as to where we were before COVID but growing tremendously. And I got to watch out with that word tremendously because, I don't know, is JP or O'Melveny on it? Okay. So JP, tremendously in this doesn't mean more than -- less than 10% or whatever we put in our public statements. But I'm sure I'll hear from you to correct that if you didn't like it. So I would say that during COVID, as I said, we fared well. We didn't grow like some people who actually benefited from the pandemic, but we're going to come out of it strong, and we're going to do well. The next question I would have is well what happened during COVID? Well fortunately, besides surviving, most of our customers continued with procurement, and we won a significant amount of work that will take us out of COVID and grow us. I don't know what word to use with the lawyers on...

Significantly.

Significantly. There we go. Kim, just helped me with that word. And it is hard to give this presentation to a screen on a computer. It's a lot more fun when there's a room and people and they raise their hands when they don't like what you say or like what you say or ask questions. So we're doing our best here today at this stockholder meeting here in Anaheim at the conference room. And I would open it up if there's any questions. I see there's a few names I don't recognize. So while I don't recognize, and I'll probably be corrected that I should have, but I see 1 here, [ Lorin Wynn ], spelled W-Y-N-N, as a guest. If you have a question, please ask. Go to the other page, please. I also see another name here that we don't recognize, [ Will Tamposi ], could be one of our lawyers, could be one of our accountants, we don't know. But if there are any questions, we'll give you a few minutes, but the bottom line from the management team sitting here in the Anaheim conference room is we are well positioned for the years to come. So thank you for being a stockholder, and we intend to get back on track where we were pre-COVID. Any questions? Do you see any? Danny? So I guess that is the count done, Kim?

Well, now that we've concluded the business report, let's proceed with reporting the voting results. The votes have been calculated and I'm pleased to report the inspector of elections has informed me that Mr. Brisbin, Mr. Cohen, Ms. Coy, Mr. Holdsworth, Mr. McEachern, Mr. McGinn, Mr. Renken and Mr. Shahidehpour have all been elected as directors. The appointment by the Board of Directors of Crowe LLP as the company's independent registered public accounting firm for fiscal year 2021 has been ratified. And the nonbinding advisory vote on the company's named Executive Officer compensation was approved. The inspector of elections will furnish to me a written report of the final vote count with respect to the matters voted on today, which will be included in the minutes of the meeting. The final results of today's vote will be recorded in a Form 8-K to be filed with the Securities and Exchange Commission within the next 4 business days. On behalf of the company, thank you again for your participation and continued support. There being no further business before the meeting, the meeting is now adjourned.