The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Tim Mulrooney - William Blair - Analyst
: Allan, Vijay good morning.
Question: Tim Mulrooney - William Blair - Analyst
: Doing well thank you just a couple for me, so it looks like you ended the year strong with 8% core organic growth for the full year and you're looking
for another year of growth in that range right in line with your long-term targets, but we noticed that the midpoint of year.
EBITDA margin, guidance range, it looks to me, and please correct me if I am wrong, but it looks to me as if you're forecasting essentially flat EIT
margins year over year from '24 to '25. So, I'm just curious, with that good operating leverage you should see on the top line, why you wouldn't
expect to see more margin expansion here in 2025.
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FEBRUARY 27, 2025 / 1:30PM, MEG.N - Q4 2024 Montrose Environmental Group Inc Earnings Call
Question: Tim Mulrooney - William Blair - Analyst
: Got it. Okay, so maybe it's just more of a point in time thing, but generally speaking you see further margin, trajectory upwards, if you step back
and look at it from a multi-year perspective, and then building on your comment on cash, it looks like cash flows were really strong in the fourth
quarter.
It was great to see. But I think, and again, correct me if I am wrong, operating cash flow conversion was still a little lower than your target for the
year of 50%. I am just curious what changed there relative to your prior expectations and what gives you confidence that that you're more likely
to hit that 50% target in 2025.
Question: Tim Mulrooney - William Blair - Analyst
: Yeah, it's Allan, it sounds like both of those are pretty much timing issues and you've gotten some payments, subsequent to your end and would
expect to collect on some of that strong growth you saw in the fourth quarter. So both of those timing issues you'd expect to begin to improve
here already in the first quarter.
Question: Tim Mulrooney - William Blair - Analyst
: Okay. great well, thank you guys for taking my questions have a good day.
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FEBRUARY 27, 2025 / 1:30PM, MEG.N - Q4 2024 Montrose Environmental Group Inc Earnings Call
Question: Jim Ricchiuti - Needham & Company LLC - Analyst
: Hi, good morning. Are you seeing any change in project timelines from clients whether government or commercial in the early days, of the new
administration, and Vijay you alluded to the tailwinds that you anticipate. Are you seeing signs yet of those tailwinds just based on conversations
that you're having with clients?
Question: Jim Ricchiuti - Needham & Company LLC - Analyst
: And then just with respect to as some of the clients sort out things that they're hearing, is there has there been any change in anticipated project
timelines?
Question: Jim Ricchiuti - Needham & Company LLC - Analyst
: Right, and I was hoping to and maybe get a little bit more color on what you're seeing on the cross-selling initiatives which seem to continue to
go. Yeah, in the right direction, but yeah, I am wondering, can you talk about that as to where you're getting the most traction? whether it's from
the types of clients or business lines and I assume that much of this is also on the cross-selling side is tied to the overall organic growth in the
business but correct me if I'm wrong.
Question: Jim Ricchiuti - Needham & Company LLC - Analyst
: It does, Vijay Thanks. I'll jump back in the queue. Thank you.
Question: Brian Butler - Stifel - Analyst
: Hey, good morning, this is Brian Butler.
So has ER work started strong this year? And then if so, to what extent has that been driven by above average weather disruption?
Question: Brian Butler - Stifel - Analyst
: Got it, Okay. And then how much potential do you see for international revenue to grow as a percentage of total and then what would drive that
expansion?
Question: Brian Butler - Stifel - Analyst
: Awesome, thank you. I'll turn it over.
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