Good day, ladies and gentlemen, and welcome to your Matrix Service Company Conference Call to discuss Results for the First Quarter of Fiscal 2018 Conference. At this time, all participants are in a listen-only mode. Later we'll have a question-and-answer session and instructions will be given at that time. [Operator Instructions] I would now like to introduce your host for today’s conference Kevin Cavanah, Chief Financial Officer. Sir you may begin.

Thank you. We appreciate everybody's patience, sorry for starting the call little late. Before I begin, please let me remind you that on today's call the Company may make various remarks about future expectations, plans and prospects for Matrix Service Company that constitutes forward-looking statements for purposes of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by these forward-looking statements as a result of various factors, including those discussed in our annual report on Form 10-K for our fiscal year ended June 30, 2017 and in subsequent filings made by the Company with the SEC. To the extent the Company utilizes non-GAAP measures, reconciliations will be provided in various press releases and on the Company’s website. I will now turn the call over to John Hewitt, President and CEO of Matrix Service Company.

Thank you, Kevin, good morning everyone and thank you for joining us this morning. As we open the call I want to congratulate two of our Matrix NAC teams, first our infrastructure team in Rahway, New Jersey; the won the 2017 Board of Directors Safety Award. This award is the highest award given by Matrix Service Company. Under the leadership of [indiscernible] this team's commitment to training and education exemplified the highest standards. Among the many accomplishments was zero recordable incidents in fiscal 2017. I would also like to congratulate the construction services unit operating out of Eddystone in [indiscernible] Pennsylvania. This team received our 2017 CEO Safety Award under the leadership of Dave Kazokas. Dave maintained an emphasis on safety excellence across a multitude of projects and among other critical accomplishments Dave also achieved zero recordable incidents. It should be noted that while we're highlighting these two operations for safety excellence across our entire business our employees have continued to drive a culture of safety which is demonstrated by record level of recordable incident rate of 0.49 in fiscal 2017. Our teams also recently worked around the clock for 17 days without injury or incident as they restored power for millions in the wake of hurricane Irma. We're extremely proud of our employees this achievement given the environment and hazards they faced in such situations. Their work demonstrated their focus on performing the tasks they were given with the commitment to keeping each other and those around them safe. Congratulations to all of our employees for a job well done. Before returning to our first quarter results, I'd like to take a few minutes to review our diversified business model and how it contributes to the strength of our overall business and also allows us to proactively navigate the…

Thank you, John. Before we get into the specifics I will give a high level of our quarter. As John indicated we are generally pleased with the results for our first quarter. Revenue volume was in line with our expectations our project execution was strong with consolidated gross margin of 10.7% which is our highest since the first quarter of fiscal 2016. As planned SG&A cost were higher than in the same period last year. As the result of our engineering acquisitions committed fiscal 2017. Our tax expense was higher than normal which I'll discuss in more detail later in the call. The bottom line as we produced good EPS in the quarter and have the solid start to the year. The core results on Mark our higher levels of project awards ended the results growth in our overall backlogs. Now let's move on to discussing specific results. Consolidated revenue for the quarter was $270 million, as compared to $342 million in the prior year, which as expected was a decrease of $72 million. The decrease in revenue on a year-over-year basis was primarily due to a revenue decline in Storage Solutions that was partially offset by higher revenue in the Industrial and Oil Gas & Chemical segments. We produced the consolidated gross profit of 28.9 million for the quarter compared to 32.3 million in the prior year quarter. The decline in gross profit in the quarter was the result of lower revenue volumes that was partially offset by improved gross margins. Strong project execution including [indiscernible] the inclusion of higher margin engineering work, as well as improved construction overhead cost recovery allowed us to achieve consolidated gross margin of 10.7%. In the prior year consolidated gross margin was 9.4%. Consolidated SG&A cost were $21.6 million in the first quarter…

Thanks Kevin. Before we open for questions I just want to restate that we are pleased with the results for our first quarter and we represents a really good start to the new fiscal year further we are confident in the markets we serve or in the other stages of recovery however timing concerned and later to awards and subsequent starts of large terminal and specialty vessel projects and our storage segment dictate that we would continue to maintain a conscious outlook. Therefore, we are going to maintain our 2018 guidance of full-year revenue of between 1.225 billion and earnings per share at $0.55 to $0.75. And with those comments we will now open the call up for questions.

[Operator Instructions] Our first question comes from the line of John Franzreb of Sidoti and Co. Your line is open.

Actually, I will start with the gross margin profile, you benefitted from a little bit from higher engineering better execution. Can you talk a little bit about how much you think is sustainable and maybe some of it was a bit more one times it certainly sounds like you expect a little push back in some of the storage gross margin going forward? Could you just talk about the puts and takes that’s going on right there?

I think if you look at the first quarter it demonstrates very strong execution throughout all of our segments. We also had the quarter bolstered by project close outs and that impacted a couple of our segments including oil and gas and chemical we had a little bit of that in storage. We also had a little bit of storm work that helped with electrical segments so overall it produced a really good margin profile. Now going forward, I think when you look at this I think the industrial margins we like to see them continue to trend upward as we see volumes increase. Storage it's a little bit hard to repeat the first quarter of this next quarter or two until we get these project awards across the finish line and get executing on those projects, so I still think we're confident we would be long-term 11% to 13% range but volume may not be there of that in the near-term but I think that will return as we move through the fiscal '18 year oil and gas and chemical remains we will maintain that 10% to 12% normal range definitely projects flows outs help that outperform this quarter. And then electrical now as we are completing the work on the generating station we're going to be replacing some of that, I think we'll eventually get back to 11% to 13% range but it may be a few quarters before we get there; overall, I feel like the margins are trending in the right direction; and we want to get towards consistently achieving this type of margin performance.

John anything to add.

The only thing I would add is in this storage segment, that while we're seeing delays in these bigger terminal projects which are both crude related and specialty vessels for gas related products that our tank business are fundamental flat bottom storage tank business, the bidding environment is very-very strong, we're winning our fair share of those, really across the Gulf Coast into the central part of the country and so from that perspective we feel very good about our call sort of our legacy tank [indiscernible] piece of our business is operating very well, it's very good margins by timing you call -- everything in the storage solutions together because some of these larger terminal projects are getting pushed out as you can see the sort of depressed the overall outlook for that segment but as Kevin said [indiscernible] with variety of projects that are related to storage solutions and so we think through the back half of this fiscal year we're going to start to see some very good awards.

And just on the industrial side of the business could you talk a little bit about maybe size up maybe the blast furnace opportunity and how we should we think about it as far as it progresses through balance of the year?

So the blast furnace awards are, they're essentially the steel industry's version of a turnaround, so blast furnace award is generally a short duration high volume projects, they last anywhere from 30 to 90 days in general and there're a multitude of trades that we go in on a shutdown basis and do a plan, repairs scope for those clients, very often there's some discovery work like there's in a refinery turnaround and there're opportunities for the scope to increase and so we're in that market where we're one of the familiar contractors to provide those services.

And then John the other part we referenced on this call that our iron and steel projects it's not blast furnace projects just to be clear, it is a longer-term project but really being real specific about the project at this point.

I guess just one final question when will we be completely out of the power generating project?

Probably we had anticipated being out at the end of this calendar year but the transition and some of the things that we're doing to support our client are taking a little bit longer so we may be up there until the end of the third quarter, prior to third quarter.

[Operator Instructions] Our next question comes from the line of Tahira Afzal of KeyBanc. Your line is open.

Congrats pretty decent quarter given all the moving parts. I guess if I look at the lower end of your EPS guidance and sort of trade line it through three quarters it doesn’t really obviously they are flat on an improving EPS line and I was wondering I mean given you feel better about how the end markets are shaping and your execution and your cost realignment efforts is that a slight bit conservative or is this something happening on the mix side that I should take into account.

As we said, so we feel very good about our project opportunities across all of our segments. We're continue to be concerned about some of the larger projects that they are going to help for us to drive to the top end of our guidance range. The timing of those awards and when we would be up we think those are started. And so, we've got an extremely strong pipeline of projects some of them are with what you would considered Blue-chip clients so we will perform those projects after balance sheets some of those are with more developer related people that require a little bit more the eyes and teeth if you cross before those projects get awarded. And so, there is a lot of movement in and around those awards permitting issues offtake agreements into that rise away and some other things that we feel that are getting closer to fruition and in some cases, we're competing so we get to win the work. So, we've taken as we said and kind of the across to surplus the how those awards are going to affect the full-year.

And then I guess if let's say I mean if you look at that awards prospect are they still some of those projects could they hit by the end of this year is that still a probability and if that happens could that notably impact your guidance?

Yes, maybe we've got a number of projects there we are anticipating sometime in the next three months we will start to roll in if win today, and I think we are going to evaluate that even when we win, there may be a delay in the start to some reason so as we get to the end of the second quarter we will evaluate those awards versus the stars and see how that effects our full-year our full-year guidance numbers.

And I assume most of those sorts of more material ones would be in storage and that's what we should be focusing on?

Yes, so we've got a great opportunity of pipeline really across all of our segments and projects ranging from 10 million to 15 million to projects in the 280 million range. But the larger projects that we are currently actively bidding and winning the award on are in our storage solution segment.

Okay, and last question from me. With your commentary on the turnaround season and spring being potentially the best you've seen in a couple of years how should we think about that in margins. I know you've don’t expect margins to really stay beyond that range that you have set in the past. But when is they if you are going to see a record turnaround season?

So, I think the key would be how big it is, we remember it's still reimbursable work so it doesn’t always blend itself to higher margin but if there's good execution and we have the big volume we could outperform we think we can do but as far as you see right now I think we've got a reasonable forecast.

And I'm showing no further questions in the queue at this time. I'd like to turn the call back to John Hewitt, Chief Executive Officer for closing remarks.

Thanks, and thanks all of you who joined our call today and we look forward to seeing in future investor conference and on our next call. Thank you.

Ladies and gentlemen thank you for participating in today's call. This does conclude the conference. You may now disconnect. Everyone have a wonderful day.