Good morning. My name is Lydia and I will be your conference operator today. At this time, I'd like to welcome everyone to the Bowman Consulting Group Second Quarter 2022 Conference Call. All lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session. Please note that many of the comments made today are considered forward-looking statements under federal securities laws. As described in the Company's filings with the SEC, these statements are subject to numerous risks and uncertainties that could cause future results to differ from those expressed, and the Company is not obligated to publicly update or revise these forward-looking statements. In addition, on today's call, the Company will discuss certain non-GAAP financial information, such as adjusted EBITDA and net service billing. You can find this information together with the reconciliations to the most directly comparable GAAP information, the Company's earnings press release and 8-K filed with the SEC and on the Company's investor website at investors.bowman.com. Management will deliver prepared remarks, after which they will be taking live questions from public research analysts. Throughout the call, attendees on the webcast may post questions for management to answer on the call or in subsequent communications, but there will be no live Q&A from the webcast attendees. Replays of the call will be available on the Company's investor website. Mr. Bowman, you may begin your prepared remarks.

Thank you, Lydia. Welcome, everyone to the Bowman Consulting Group second quarter 2022 earnings call. I'm Gary Bowman, the Chairman and CEO of Bowman, joined this morning by Bruce Labovitz, our Chief Financial Officer. Before we get started, I would like to extend a warm welcome to everyone from PDC and Fabre Engineering, our two most recent acquisitions. The talented professionals joining us from Southern California and Florida Panhandle expand our reach, add to our client network and deepen our talent pool. We are excited to have completed these transactions, and we've already realized some significant cross-selling successes with both of these firms. Additionally, I'd like to thank all the members of the Bowman team who worked tirelessly delivering the exceptional growth that we've been experiencing. Our people focus their efforts on delivering value to our clients and supporting each other by sharing work and cross-selling, creating an inclusive culture that we are all proud of. As outlined in our press release last night, the second quarter of 2022 picked up where the first quarter left off with continued strong growth and record results. Our net revenue in the quarter puts us on pace for over $200 million a year for the first time. We continue to deliver on our strategy of driving both organic and acquisitive growth with an organic net revenue growth rate of roughly 30% year-over-year. Looking to the second half of the year, we are confident in the likelihood of continued growth, even in light of potentially challenging economic conditions. The mix of our business, we believe, insulates us from any meaningful impacts from rising interest rates and volatile energy prices. In connection with our ongoing acquisition program, we are raising our guidance for the full year. Now I'm going to turn the call over to Bruce, who will discuss our financial results in detail, and then I'll return to talk a little bit about our markets and our M&A program. Bruce, go ahead?

Great. Thank you, Gary. Welcome, everybody. We are pleased to be here today talking about another record quarter. It's hard to believe that we are now comparing two quarters, both of which were operated as a public company. Gross revenue for the second quarter increased by $25.9 million to $62.4 million, or 71%. Year-over-year organic gross revenue was 27%. Net revenue for the quarter increased by $23.9 million to $56.4 million, or 74%. Year-over-year organic growth for net revenue was 32%. It's important to note that this is true organic growth in the volume of work billed, not simply the impact of increased pricing. We saw growth in orders and net revenue across all our markets, resulting from the implementation of our growth plan, which focuses on cross-selling to existing customers throughout our national offices, creating revenue synergies from acquisitions, and focusing our efforts on increasing our work with existing clients and winning new assignments. Adjusted EBITDA for the second quarter increased $3.4 million or 81% to $7.6 million compared to the year-ago period. This represents an adjusted EBITDA margin of 13.4%, which is up 50 basis points compared to last year. You can find the reconciliation for non-GAAP metrics in our press release. Gross revenue for the six months ended June 30 increased $46.6 million to $114.9 million, or 68%. Year-over-year organic growth of gross revenue was 31%. Net revenue for the six months ended June 30 increased $42.8 million to $104.1 million, or 70%. Year-over-year organic growth for net revenue was 34%. In our business, it is a positive outcome when the growth of net revenue outpaces the growth of gross revenue. Adjusted EBITDA for the six months ended June 30 increased $6.7 million, or 81%, to $15 million. This represents an adjusted EBITDA margin of 14.4%, which is up 90 basis points compared to last year. Gross margin for the second quarter was 50%, virtually identical to the same period last year. Overhead for the quarter was 45% of gross revenue compared to 47% in the prior year, demonstrating a positive trend illustrating our operating leverage through efficiency of scale. Gross revenue for the second quarter was comprised of roughly 68% building infrastructure, 15% transportation, 13% power and utilities, and 4% categorized as other emerging markets, which includes water resources, mining, and other energy transition services. Diving deeper into the building infrastructure market, we note that approximately 44% of the gross revenue that was building infrastructure was residential in nature, including for-sale housing, multifamily housing, and mixed-use developments. Within that 44% of residential services, 49% related to for-sale homebuilding activities. Thus, for-sale residential services represented approximately 15% of total gross revenue for the quarter. Gross revenue for the six months ended June 30 was comprised of roughly 71% building infrastructure, 12% transportation, 13% power and utilities, and 4% other emerging markets. Diving deeper, we note that similarly, 44% of the 71% of gross revenue that was building infrastructure was residential in nature, of which 49% was related to for-sale homebuilding activities. Again, for-sale residential services represented approximately 15% of total gross revenue for the six months. We think it's important to highlight this because there seems to be a sense in the marketplace that we are highly dependent on for-sale residential homebuilding, and the downturn in that market could heavily impact our future results. While it is a significant component of our overall business, it is not overly weighted in its potential impact on our future results. Our balance sheet remains strong with net debt of approximately $6 million and a net leverage ratio well below one. Our CapEx remained consistent at roughly 3.7% of gross revenue for the six months, with our CapEx spending funded through our capital lease facilities, all of which have plenty of available capacity remaining. We generated in excess of $4 million of cash from operating activities during the six months ended June 30. We ended the quarter with nearly $26 million in cash and our full $25 million of availability under our revolving credit facility. We recently received preliminary approval from BofA to increase the credit facility to $50 million and have received expressions of interest from other sources of non-bank debt capital to provide unsecured debt facilities as needed. At this time, we are confident that we have sufficient access to capital to continue executing on our strategic growth plans well into next year without raising any additional equity capital. This does not mean we will not continue to use our equity as a component of consideration for acquisitions. But to be clear, we do not anticipate a public market equity raise in the foreseeable future. As of June 30, 2022, we had approximately 13,264,000 shares outstanding. There have been no significant additional equity issuances since the end of the quarter. In July, in connection with the PDC acquisition, we issued a convertible note with up to 285,000 unregistered shares subject to conversion at $14 per share over two years. Upon conversion, the shares would have a six-month holding period and none have been converted as of today. Our backlog on June 30 was $205.6 million, an increase of $38.6 million or 23% compared to December 31, 2021, and an increase of $82 million or 66% compared to June 30, 2021. Our backlog is comprised of roughly 53% building infrastructure, 30% transportation, 15% power and utilities, and 2% other emerging markets. Consistent with gross revenue, approximately 13% of our June 30 gross backlog relates to for-sale residential housing. As Gary mentioned, we are increasing our fiscal year 2022 guidance for net service billing to a range of $202 million to $220 million, with adjusted EBITDA in a range of $29 million to $33 million. This increase from previously issued guidance of $185 million to $200 million and $25 million to $29 million results from both recent acquisitions and expected continued organic growth. Our guidance only includes acquisitions that have been completed as of the day the guidance is issued. Future acquisitions could have a positive impact on our forecast. The integration of our acquisitions into our systems is an ongoing process, which generally takes between three and six months to complete for each acquisition. Our dedicated integration team and our corporate accounting group are doing a great job bringing all of these different systems, processes, cultures, and organizations together into one unified platform. I want to express my particular gratitude to those folks for all their hard work.

Thanks, Bruce. I'm going to turn my attention now to our business, the state of our markets, the status of our strategic growth plan, and the vision for the future of our business. I will start by addressing the macro environment that we are working in. The demand for infrastructure investment is as strong as it has ever been during my 40 years in this business. Both public and private sector clients are competing for the services of firms like ours. What we are experiencing is a convergence of a growing market in which there is more business to be had and growth within our business that is clearly taking market share from the competition. While some of the markets we serve are reactive to interest rates or driven solely by changes in rates, it's important to remember that in historical context, rates are still substantially lower than they have been during other periods of inflation and aggressive Federal Reserve tightening. The mix of markets that we serve provides a buffer against economic cyclicality. While we all hear the same rhetoric about economic conditions and forecasts, these indications seem to run contrary to the resolute confidence that our clients have in their business and their willingness to invest in infrastructure. This is made clear to us by the continued strong demand for our services across all sectors. Our bookings and new orders, which we refer to as our sales, continue to grow month after month with a book-to-burn ratio well in excess of one. We are acutely attuned to any macroeconomic headwinds that may adversely affect our business, and to date, we have yet to experience any systemic slowdown in demand for our services. We are beginning to see the early stages of dollars flowing from the transportation infrastructure bill and the recent reconciliation legislation that earmarks money for investment in energy transition, which has already sparked conversations with both current and new clients about future projects. Our strategic growth plan has two primary components: organic growth and acquisitive growth. While these are two distinct avenues of growth, they overlap in many areas. As we evaluate potential acquisitions, our primary objectives are to identify cultures that are consistent with ours, businesses that are in attractive markets and geographies, and that provide opportunities for value creation through revenue synergies. While there is a deep market for the kinds of companies that we are willing to buy at the valuations we are willing to pay, the challenging part is integrating these companies, not solely from an operational point of view, but from a mindset of cross-selling and revenue synergies. We have nearly 70 offices around the country. We have a tremendous opportunity to grow revenue by cross-selling our services to the existing clients of acquired firms as well as increasing our share of our current clients. We've begun integrating our transportation practice into the managed practice and have started cross-selling our clients with additional capabilities related to traffic studies. We successfully landed large projects on the Gulf Coast and have been able to penetrate and secure building services assignments through our new MEP practices. From our 1519 acquisition, we have expanded our survey services to oil and gas providers throughout Texas and beyond. We have grown our revenue from acquired firms such that in less than a year, we have collectively picked up over half of the purchase price. With 12 acquisitions completed in the last 18 months, we have created a platform from which we can deliver almost any civil engineering service to each of the markets we serve. We have recently received some excellent assignments that have resulted from the acquisitions we have closed and the skill sets they have brought to us. Our vision for this company is to continue building on the depth of experience and breadth of services that we can offer to the markets we concentrate on. We are focusing these efforts, especially on energy transition, power and utilities, and transportation infrastructure markets. Our M&A pipeline is as deep as it has ever been, with plenty of opportunities within our target valuation range. Year-to-date, we have acquired approximately $50 million of net revenue at an average multiple of under 6x estimated 2022 adjusted EBITDA. We expect to continue being acquisitive throughout the second half of the year but will likely maintain a lower risk profile with respect to acquisition size until things stabilize in the overall economy. We will continue to seek out companies that diversify our portfolio of experiences and opportunities and extend additional revenue synergies and cross-selling opportunities. Again, I want to extend my gratitude to everyone at Bowman for working diligently every day, exceeding the expectations of our clients, creating value for our communities, our investors, and cultivating a culture that makes Bowman a great place to build a career. I'll now turn the call back over to the operator for the question-and-answer session.

Your first question comes from the line of Brent Thielman of D.A. Davison. Please go ahead.

Hey, great. Thanks. Gary, Bruce, good morning.

Good morning, Brent.

Good morning, Brent.

I was curious – yes, first off, I'm just curious if there's a way to understand the contribution to organic growth from more billable hours versus higher billing per hour. I think you made a comment in the prepared remarks, and I was curious about that?

I'm not sure there's a specific way to answer that the way you've asked it, except that I think the comment in the prepared remarks was that the organic growth is not simply a function of the same workforce at the same utilization rate at higher billing rates. It is a function of increased headcount working at slightly higher utilization rates for more clients.

Okay. Thanks, Bruce. And then it looks like the non-housing piece, the building's infrastructure vertical is continuing to grow really well. Maybe you could just talk about some areas that have been particularly strong for you in that side of the business.

Yes, commercial and municipal projects.

Yes, both of those markets are very robust. All of the government markets we are involved in have fully recovered from COVID, so they are spending at very healthy paces and pursuing new projects on a strong basis. The commercial and retail developers, I would say, are often the actual retail chains, and they are very aggressive in their expansion, which is very beneficial. Some specific submarkets, such as data centers within building infrastructure, have been extremely strong. Schools and other educational-type facilities have also been robust. We have seen strong performance in industrial commercial, for example, we work with Amazon on their HQ2 project in the D.C. area, and it remains a strong market for that type of work. All of those areas have positively contributed to our overall growth.

Okay. And then in March, you laid out plans to acquire $75 million or more in annualized net service billings; you're up to looks like over $40 million now. How robust are the discussions today? How is this evolving economic climate impacting those discussions? Is it limiting your ability to achieve that target?

The pipeline is robust. I don't sense any change in the sentiment of the sellers. Their expectations haven't changed— they remain the same, but the market remains strong. We really like these smaller acquisitions because there's a lot of integration involved, but we're getting a lot of synergy for our investment. So, I know we previously mentioned an average size of $10 million; however, they likely won’t average that this year. But if we don't reach $75 million, we will be close to it. Overall, the marketplace is strong, and the pipeline remains very promising.

It’s important to remember that the $75 million target was aspirational. It is not incorporated into our guidance. We don't include an acquisition in our guidance unless it is closed. We would like to continue being active; whether it’s $68 million, $75 million, or $50 million, we will continue monitoring and updating guidance as we are successful with the strategy.

The bottom line is that the market and environment are exactly where we expected and hoped they would be at this time of year.

Okay. Others in the engineering space have started discussing the transportation end market increasing, either as a direct or indirect result of the increased infrastructure funding. Are you seeing that in your bid activities now?

We are seeing some of it up in Illinois, and some of the clients are beginning to see that activity. Yes, we are starting to witness projects hitting the street that are influenced by the transportation bill.

Okay. Thanks, guys. I will get back in the queue.

Thanks, Brent.

Your next question comes from the line of Alex Rygiel of B. Riley Securities. Your line is open.

Thank you. Good morning, gentlemen. A very nice quarter. A couple of quick questions here.

Thank you, Alex.

Bruce, going back to that first question about organic revenue growth. Obviously, there are a lot of different components contributing to the 34% growth year-over-year. Is there a way to think about how much of it is due to improved pricing versus organic volume versus synergistic volume?

Not without it being somewhat of a lag because you can't easily differentiate pricing in real-time. If I had to break that down, I would estimate that 80% of the growth is due to organic work driven by our existing clients or clients we are acquiring—not through acquisition, right. I'd say another component that would account for 10% to 20% could be considered synergistic, stemming from cross-selling and synergy. But I think of those first two as one significant source together. We are generating more work from non-acquisitive sources. Our headcount is increasing not just because of acquisitions, but because of an increasing volume of work that needs doing. Yes, there is some value addition occurring due to the shortage of skilled workers in our market, but we are not simply relying on the same headcount to generate higher revenue.

That’s helpful. And as it relates to your backlog, which end markets do you think are expanding the fastest organically right now?

I would say probably transportation and power utilities are moving fastest in our backlog. In terms of percentage, the energy transition business is also growing rapidly, although it might not have the same financial impact as the other two markets. However, it does remain important. Building infrastructure continues to grow organically. We monitor homebuilding and commercial developers. Listening to companies like Horton and Lennar, they are suggesting they're not slowing down inventory investment. While they may be delaying starts somewhat, overall demand for services remains unchanged or is increasing. We are feeling confident about those primary markets.

Lastly, regarding your guidance, the low end of your revenue guidance of $205 million suggests that the second half of the year may decline from Q2. Is that typical seasonality you expect, or are you being conservative? Do you see anything in the marketplace suggesting a slowdown from Q2?

We generally see a slightly lighter Q4. The holidays—being a people business, our staff takes vacations. You can only bill hours that people are working. That Thanksgiving to New Year's period can be a little slower for us, but not always. Alex, it's more about acknowledging the news we all hear every morning. We want to be cautious about the potential for a slowdown, so that is why we provided that low-end estimate. However, we believe our range suggests more optimism for potential upside.

Very helpful. Thank you very much.

Thanks, Alex.

We have a follow-up question from Alex Rygiel of B. Riley Securities. Your line is open.

Thanks for your time. Just one last question. Given your active acquisition strategy, can you touch upon how systems integration is progressing? How is the back-office integration going, and what successes or complications have you encountered? What systems are in place as you prepare for future acquisitions?

Yes. Integration is one of the most challenging aspects. There are really two components to it, and I can address both the systems side and the cultural side. We have a strong backend process in place. We have a solid ERP system. Going public, we knew that this would be part of our journey, and it was something we well-prepared for. This has been a challenge and has required adding headcount. It involves integrating systems ranging from simple shoeboxes and notes to QuickBooks to our ERP systems. All the companies we acquire are strong organizations with good knowledge about their businesses. Initially, we integrate critical processes such as cash management and revenue recognition. Following that, we work toward fully integrating our billing processes and ensuring uniform visibility across all our data. Getting a comprehensive understanding of all the data is the most challenging part during the first couple of months.

Regarding what Bruce was saying, the cultural integration is equally important. It goes beyond just distributing company hats or creating wallet cards with our cultural values. We focus heavily on embedding a culture around cross-selling, and this has yielded tremendous success that has exceeded our expectations. We’ve actually started to quantify this effort recently, and the results are quite impressive. I’m not sure we can establish a formal KPI around it, but we are thrilled with the results.

To close, I do not anticipate needing substantial CapEx spending to support the integration process. We already have robust systems and capabilities in place from an ERP perspective to keep moving forward.

Very helpful. Thank you.

And finally, we have a follow-up from Brent Thielman of D.A. Davidson. Your line is open.

Thanks. Bruce, what are your cash flow expectations for the second half?

Yes. I think our cash flow generation will mirror what we’ve seen in the first half. We will continue investing in growth. When we make acquisitions, they do provide us with working capital as part of the consideration. We are continuing to invest cash generation in growth. Our organic growth continues to consume cash flow. I think we are on a trajectory for the second half that will likely resemble or slightly improve upon the first half.

Okay. Thank you.

There are no further questions at this time. Mr. Bowman, I turn the call back to you.

Thanks, Olivia. To wrap up, we're very happy to have the chance to report such a great quarter this morning. I want to thank everyone for your time today, and I especially want to thank all our investors for the trust they have placed in us. We are committed to continuing to create value here. Good morning to all. Thank you.

This concludes today's conference call. You may now disconnect.