Great Lakes Dredge & Dock Q2 2025 Earnings Report

Great Lakes Dredge & Dock EPS Results

• Actual EPS: $0.14
• Consensus EPS: $0.08
• Beat/Miss: Beat by +$0.06
• One Year Ago EPS: N/A

Great Lakes Dredge & Dock Revenue Results

• Actual Revenue: $193.76 million
• Expected Revenue: $177.70 million
• Beat/Miss: Beat by +$16.06 million
• YoY Revenue Growth: N/A

Great Lakes Dredge & Dock Announcement Details

• Quarter: Q2 2025
• Date: 8/5/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, August 5, 2025
• Conference Call Time: 10:00AM ET

Great Lakes Dredge & Dock (NASDAQ:GLDD) Corp. engages in the provision of dredging services. Its projects include channel and port maintenance, channel deepening and port expansion, coastal protection and restoration, as well as land reclamation. The company was founded by William A. Lydon and Frederick C. Drews in 1890 and is headquartered in Houston, TX.

Great Lakes Dredge & Dock Q2 2025 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Great Lakes reported Q2 revenues of $193.8 million and adjusted EBITDA of $28 million, with gross margin rising to 18.9%, driven by improved utilization and strong project performance.
• Positive Sentiment: The company has a robust $1 billion dredging backlog (93% capital/coastal) plus $215.4 million in pending awards, providing clear revenue visibility for late 2025 and into 2026.
• Positive Sentiment: Newbuild program is nearly complete: Amelia Island is set to enter immediate service and the Arcadia (first U.S. Jones Act-compliant rock installation vessel) was launched in July for 2026 offshore energy work.
• Positive Sentiment: Share repurchase program: $50 million authorization initiated in March with 1.3 million shares bought for $11.6 million, reflecting confidence in long-term value.
• Negative Sentiment: Third quarter will feature three vessels in dry dock for regulatory surveys and repairs, which may temporarily pressure utilization and increase costs.

Presentation

[Operator]

Good day, and thank you for standing by. Welcome to the Q2 twenty twenty five Great Lakes Dredgen DOT Corp Earnings Conference Call. At this time, all participants are in a listen only mode. After the speakers' presentation, there will be a question and answer session. To ask a question during the session, you will need to press 11 on your telephone.

[Operator]

You will then hear an automated message advising your hand is raised. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your first speaker today, Eric Burge, Vice President of Investor Relations. Please go ahead.

[Eric Birge, VP - IR & Finance at Great Lakes Dredge & Dock]

Good day, and thank you, everyone, for joining us. Welcome to Great Lakes Dredgen Dock Corp. Second quarter twenty twenty five financial results conference call. Before we begin, please note that certain statements made during this call are forward looking in nature and are subject to various risks, uncertainties and assumptions. These factors may cause actual results to differ materially from those anticipated.

[Eric Birge, VP - IR & Finance at Great Lakes Dredge & Dock]

For a detailed discussion of these risks, please refer to our filings with the Securities and Exchange Commission. We will also discuss certain non GAAP financial measures, including adjusted EBITDA. Reconciliations of these measures to the most direct comparable GAAP measure can be found on our earnings release and on our Investor section of our website at investor.gldd.com, along with other supplemental operating information. Joining me on today's call is Lasse Pedersen, our President and Chief Executive Officer and Scott Kormlaub, our Senior Vice President and Chief Financial Officer. Lasse will begin with a review of the quarter's key developments, followed by Scott, who will provide detailed overview of our financial performance.

[Eric Birge, VP - IR & Finance at Great Lakes Dredge & Dock]

Lasa will then conclude the call with commentary on the business outlook and market trends. With that, I will now turn the call over to Lasa.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Thank you, Eric. Following strong financial results in the first quarter of this year, the momentum continued into the second quarter with solid results, driven by high equipment utilization and strong project performance, executing complex port deepenings and coastal restoration projects, leveraging the capability of our extensive fleet. We ended the quarter with revenues of $193,800,000 and adjusted EBITDA of $28,000,000 Our dredging backlog remains strong at $1,000,000,000 with 93% coming from capital and coastal protection projects, plus an additional $215,400,000 in awards and options pending. Our successful bid strategy from last year resulted in a large number of project wins and a quality backlog, which will support high asset utilization and a solid revenue generation for the remainder of 2025, as well as providing a good base and revenue visibility for 2026. During the quarter, we received notice to proceed on the Woodside, Louisiana LNG project.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

The awarded work is included in our second quarter backlog, along with two options that are included in our options pending award. Dredging operation on the project are expected to commence early twenty twenty six. Our strong performance in Q1 and good outlook for the remainder of the year contributed to our decision to initiate a $50,000,000 share repurchase program in March. As we believed, our share price did not reflect the company's financial performance and long term outlook. As of June 30, we have repurchased 1,300,000.0 shares with a total spend of $11,600,000 under this program.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

During the quarter, we upsized our revolving credit facility to further enhance liquidity, which Scott will provide more details on. Moving to our newbuild program, which is nearing completion. Our newest hopper dredge, the Amelia Island, is expected to be delivered in the next few weeks and will go straight to work on projects already in backlog. The Amelia Island and our sister ship, the Galveston Island, have been specially designed for the shallow and narrow waters in our U. S.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Coastlines and are efficient tools for us to work on coastal protection projects such as beach restorations, wetland improvements, and barrier island construction. The final vessel in our newbuild program, the Arcadia, the first U. S. Flank Jones Act compliant subsea rock installation vessel is also currently under construction and hit a key milestone with her launch from dry dock in July. Delivery is expected in the 2026, at which time she will go straight to work on Equinor's Empire Wind one project.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

The target markets for the Acadia include domestic and international projects for protection of critical subsea infrastructure, such as oil and gas pipelines and power and telecommunication cables and offshore wind installations. I'll now turn the call over to Scott to further discuss the results of the quarter, and then I'll provide further commentary around the market and our business.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Thank you, Lasse, and good morning, everyone. I'll start by walking through the second quarter, which resulted in revenues of $193,800,000 net income of $9,700,000 and adjusted EBITDA and adjusted EBITDA margin of $28,000,000 and 14.4% respectively. Despite having four dredges performing the regulatory dry dockings at various times during the 2025, revenues of $193,800,000 increased $23,700,000 from the prior year's second quarter as every active dredge was working for the majority of the quarter. Current quarter gross profit and gross profit margin increased to $36,600,000 and 18.9 percent respectively compared to $29,800,000 and 17.5% respectively in the 2024. The increase in gross margin is primarily due to improved utilization and project performance and a large number of capital and coastal protection projects, which typically yield higher margins.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

These projects accounted for over 88% of our second quarter revenue. The quarter over quarter gross profit increase was partially offset by higher drydocking costs. Current quarter's operating income of $17,100,000 increased $2,500,000 compared to the prior year's quarter operating income of $14,600,000 The year over year increase is driven by higher gross profit, partially offset by higher general and administrative expenses, mostly due to increased incentive compensation resulting from the strong first half of the year. Net interest expense of $4,200,000 for the second quarter twenty twenty five was flat compared to the 2024 and second quarter twenty twenty five net income tax expense of $3,400,000 increased from $2,800,000 in the same quarter of 2024 due to the stronger results. Rounding out the P and L, net income for the second quarter twenty twenty five was $9,700,000 up from $7,700,000 in the prior year quarter.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Total capital expenditures, including capitalized interest for the second quarter, were $64,600,000 made up of $19,800,000 for for the Hopper Dredge Amelia Island, 28,700,000.0 for the construction of the Acadia, 8,800,000.0 related to the addition of support equipment with the remaining $7,300,000 coming from maintenance and growth. Our previous full year CapEx guidance of between $140,000,000 and $160,000,000 including capitalized interest remains unchanged. Turning to our balance sheet, we ended the quarter with $2,900,000 in cash and $5,000,000 drawn on our revolver, which doesn't mature until the 2027. And as Lasse mentioned earlier, in May, we executed an amendment to our facility, upsizing our revolver by $30,000,000 to $330,000,000 further enhancing our liquidity, which stood at $272,000,000 at quarter end. Our balance sheet is in great shape with a trailing twelve month net leverage ratio of 2.7 times, a weighted average interest rate on our total debt under 7% and no debt maturities until 2029.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

For the 2025, we were $36,000,000 free cash flow positive and as our newbuild program will be substantially complete at the end of the year, we expect this number to significantly grow starting in 2026. As I discussed on the Q1 earnings call, 2025 is a heavier than normal dry dock year for us. And during the third quarter, we will have three vessels at the dock at various times for regulatory surveys and repairs. Utilization will remain strong on the other vessels and with the Amelia Island scheduled to come online, we expect to see third quarter EBITDA higher than the second quarter. Despite the large number of drydocks, our expectation is that full year 2025 results will be the highest in company history for both revenue and net income.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

With that, I will turn the call back over to Lasse for his remarks on the outlook moving forward.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Thank you, Scott. The administration continued to demonstrate strong and consistent support for the dredging industry. The U. S. Army Corps of Engineers is operating in fiscal year twenty twenty five under a continued resolution through September 30, which sustains the record funding levels established in the prior fiscal year's budgets.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

This support, along with our $1,000,000,000 backlog, which includes a robust mix of large and complex projects in the beach renourishment and port deepening markets, enable us to continue to deliver on a very busy 2025 and provides clear revenue visibility extending well into 2026. We expect the 2025 dredging bid market to be at a normalized volume of approximately $2,000,000,000 focused on coastal protection projects after very strong port deepening bid markets in 2023 and 2024. As we look further ahead, we are beginning to see meaningful progress on the next phase of deepening projects, including New York, New Jersey, Tampa, New Haven, and Baltimore, among others, with dredging work likely to commence in 2027. In response to early signs of potential delays in The U. S.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Offshore wind market, we proactively adjusted our strategic outlook for the Arcadia. Over the past couple of years, we have expanded our target markets for the Arcadia to include the safeguarding of critical subsea assets, including oil and gas pipelines, power transmission lines, telecommunication cables, and international offshore wind farms, increasing our opportunities into a broader range of services we now refer to as offshore energy. The Arcadia is engineered to precisely deposit rock for the protection of subsea infrastructure against environmental forces, such as weather and potential acts of sabotage by hostile entities. We are actively pursuing engagement across these sectors, bidding work for 2027 and onwards as we have between Empire Wind I and Earthstead Sunrise Wind, Acadia fully booked for work in The U. S.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

For 2026. In conclusion, we are confident of strong project execution and results for the remainder of the year, and our strong backlog gives us good revenue visibility for 2026. Our newbuild program is coming to an end, and we are looking at generating solid positive cash flows for 2026. And with that, I'll turn the call over for questions.

[Operator]

Thank you. At this time, we will conduct a question and answer session. Our first question comes from Joe Gomez of NOBLE Capital. Your line is now open.

[Joe Gomes, Senior Research Analyst at Noble Capital Markets]

Good morning. Congrats on the quarter.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Thanks, Joe.

[Joe Gomes, Senior Research Analyst at Noble Capital Markets]

I wanted to start off with just kind of we take a look at the pace of awards. Is it running to expectations? Are you seeing anything being kind of pushed out to the right? Is there anything there that leads you to have any concern about the award level for this year?

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Yeah, Joe. So, as we have talked about it at year end, one, we expected a more normalized bid market for this year that's playing out. We also knew as the current deepening cycle was starting to come to an end, there would be very little capital projects that also was playing out. As Lasse said, we do see early signs of the next wave of deepening projects coming out in the next eighteen months or so, which is a good sign. And then the third thing, with our utilization, with our backlog, we were not going to be able to participate in a lot of the bids that came out just because we didn't have availability.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

For the first half of the year, we did not bid on well over 50% of the projects that came out. One, we just didn't have the availability or two, it just didn't fit into profile of the limited availability we have. So, this market ebbs and flows, our win rate is going to ebb and flow and we have the backlog like I have, it's just it's impossible for us to keep winning at the rate that we were winning over the last couple of years.

[Joe Gomes, Senior Research Analyst at Noble Capital Markets]

Okay, thanks for that. And on the Acadia, obviously, you guys mentioned you've got it fully booked in '26 and you're exploring other markets in '27. Is there the possibility that that you think that vessel could still be in The US in '27? Are most of your efforts looking overseas in the international markets for 'twenty seven?

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Yes, currently, we are bidding a lot of work in Europe, and we are also looking at Asia for the remainder of this decade. The market in Europe is continuing to be strong, and it is probable or most probable that the vessel will be in Europe when we get enter 2027.

[Joe Gomes, Senior Research Analyst at Noble Capital Markets]

Okay.

[Joe Gomes, Senior Research Analyst at Noble Capital Markets]

And then one last one for me, kind of more 10,000 foot level off. You guys have mentioned the new build program should be coming to an end here, all the positives for that. Is there anything out there, maybe far out in the horizon right now that would make you reconsider and say, maybe we need to build more vessels or is this, hey, we are definitely done here for whatever the next phase of years is?

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Well, we've been looking at our fleet. It's my opinion, we have invested heavily into our hopper fleets. So we have now four very young modern hoppers in the market, plus we have two older ones, smaller ones. So we have a fleet that is updated and very competitive. Our cutter fleet is also large.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

We are continuously updating the equipment on board our cutters. So we at this point in time, we don't see any need for building any new dredges, but that may change over time. But I would say for the coming couple of years, it's not on the agenda. Scott, do have any comments?

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

No, I think that's right. Joe, we've said we may look to do some strategic upgrades on some of the non hopper fleet, but we're comfortable with the number of dredges that we have right now. We strategically invested over the last few years and I think we're already starting to see the dividends paying off and can continue to expect the same sort of results.

[Joe Gomes, Senior Research Analyst at Noble Capital Markets]

Okay, great. Thanks for that. I'll get back in queue. Thank you.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Thank you.

[Operator]

Thank you. Our next question comes from the line of Julio Romero of Sidoti and Company. Your line is now open.

[Julio Romero, Equity Research Analyst at Sidoti & Company, LLC]

Great. Thanks. Good morning, Lasse, Scott and Eric. Maybe staying on the Acadia for a bit. What's your confidence level in Acadia delivery to you in the 2026 versus potentially later in the year?

[Julio Romero, Equity Research Analyst at Sidoti & Company, LLC]

And then what would be your best guess as to Acadia revenue dollars in 2026 if we assume it does get delivered on time and goes straight to work on Empire one?

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Yes. We have a high confidence in getting the vessel delivered in Q1. That is the date that yard is giving us. The acquisition of the yard by the Koreans, Hanwha, has resulted in additional resources coming to the yard, and the progress is good. As I said, we are out of the dry dock, and it's now at the outfitting key at Philly Shipyard.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

And they are looking at trying to improve the delivery date to an earlier delivery in Q1. But as we are speaking today, that is what the artist is telling us. Revenue expectation?

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Yes. And Julio, so we are there are some options that will get exercised. We're still finalizing pricing on that. So I'm going to keep numbers a little closer there. But with the end of Q1 delivery and call it another month, month and a half of commissioning, we should see a little more than six months give or take of revenue.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

I think we have said that in The U. S, this vessel is definitely capable of getting well north of $100,000,000 revenue for full year and again, call it seven months give or take with this year, just normal ebbs and flows and moves between jobs. I think you can get directionally correct on how we're thinking about it.

[Julio Romero, Equity Research Analyst at Sidoti & Company, LLC]

Yes. Fair enough. And any update on potential wins for the offshore energy awards for the Acadia? And a quick refresher on what the lead time is between bidding and award for offshore energy in Europe and in Asia?

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Yes. And the that lead time is much shorter in those markets. It's mature markets. Here in The U. S, we were fortunate to be able to book projects very early for the Acadia due to the newness and the novelty in the market and lack of vessels or U.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

S. Vessel, flag vessels. In the international markets, it's more looking at maybe a year, maybe less in lead time between award and you actually execute the project.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Yes. Julio, there has not been one project in Europe or Asia that we have bid on for 2027 or beyond that's been awarded to anybody yet.

[Julio Romero, Equity Research Analyst at Sidoti & Company, LLC]

Okay. I appreciate the finer point on the lead time there and a year or less. That's very helpful. Just maybe on the base business, are you I think you touched on it earlier, but are you seeing any change in customer hesitation at all or any delays in decision making the base dredging business?

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Well, as you know, we are in a continued resolution, which is good and bad news. The Corps cannot bid new projects in this situation, but they have the revenue or the guaranteed for the revenues similar to prior years. So, that means that there's a lot of projects which are being executed in this situation. We have to wait until the government or the Congress get together and make a new budget for next year, and then there's a number of new projects that should be included in that new budget. That is the, let's say, clarity that we have around it.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

There's a number of beach renourishment and reconstruction projects that are being bid at this point in time, and that market is very strong. And as you know, we perform extremely well on those projects on the East Coast.

[Julio Romero, Equity Research Analyst at Sidoti & Company, LLC]

And I guess for LNG, guess is also what I was getting at, if in the order cadence of LNG, any change from decision from customer decision making on that front?

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Well, we are currently engaged in three projects in the LNG space. There is a couple of other projects where it's either being done by other dredgers. There's probably two LNG projects other than the three that we are working on that is going forward, and where our competition will be fully engaged. So beyond that, it's probably more a discussion on the general LNG market. Is there room for more capacity to be built in The U.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

S? And how can the export markets really absorb these volumes of LNG going forward.

[Julio Romero, Equity Research Analyst at Sidoti & Company, LLC]

Helpful. I'll pass it on. Thanks.

[Operator]

Thank you. Our next question comes from the line of Kevin Gainey of Thompson Davis and Co. Your line is now open.

[Kevin Gainey, Senior Research Analyst at Thompson Davis & Co]

Good morning, Lasse, Scott and Eric. Nice quarter on a heavy dry dock.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Great. Thanks, Kevin.

[Kevin Gainey, Senior Research Analyst at Thompson Davis & Co]

I was hoping that maybe we could kinda touch on the Acadia conversations that you guys are having. And maybe at this point, what is more likely to happen? Is it going to be more international wind work or asset protection jobs? And kind of how those conversations are unfolding?

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

Yes. It's a very interesting market for us. I think I've been saying on these calls that we always knew that the offshore energy business would be both U. S. And international work.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

The fact that we now have a slowdown in The U. S. As we are seeing means that the international work had to be addressed earlier. We started that almost two years ago to talk to clients that we have here in The U. S.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

About their European operations. And we have been bidding very actively for that work starting in 2027 and onwards. It's offshore wind farms as large volumes or rock needed for the offshore wind farms, but also the power cable transmission cables that are being installed in Europe requires a lot of rock protection. It's a large market, and we are actively engaged in bidding for that work. There's also been discussions around the communication cables, the sabotage that's been happening in the Baltics and the, let's say, unprotected infrastructure that you see in the North Sea of oil and gas pipelines.

[Lasse Petterson, CEO, President & Director at Great Lakes Dredge & Dock]

And there is discussions ongoing on how to protect those from sabotage. So there is several markets here which are interesting for Acadia.

[Kevin Gainey, Senior Research Analyst at Thompson Davis & Co]

Thanks, Russ. I appreciate that color. As far as I think you mentioned, Scott, dry docks are in Q3 going to be three. Is there any setup for Q4 as well currently?

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Yes. Right now, and again, the caveat, these can still ebb and flow, left or right. We have two planned at various times, not necessarily full quarter during Q4. And then again, I'll answer the next question you didn't ask because it was such a heavy dry dock year this year, we expect to see a lower than average dry docking schedule for 2026.

[Kevin Gainey, Senior Research Analyst at Thompson Davis & Co]

And just to clear up on cash flow, what was operating cash flow Q2? And do you have any thoughts about second half cash flow?

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Yes. Q2 operating cash flow was right around 30 I mean, I'm sorry, about 60 ish for operating cash flow. And as I mentioned on the call, cash flow for the first half of the year, well above 30. We expect to see I'm not going say the numbers will be the same, but this year is going to look like a normal year. The bookend quarters, Q1 and Q4 will be the strongest and then the middle ones, something less.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

So, we saw that the first half of the year. My expectation is we'll see that in the second half of the year. I think we do still have to finish up the payments on the Amelia Island. We obviously have some more to do on the Acadia for this year. So we still have some CapEx this year.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

My guess is if you just kind of look at total cash flow second half of the year, we'll be probably flattish give or take. And then as we talked about next year as the new build program winds down at the beginning of the year, that's when we really start generating cash.

[Kevin Gainey, Senior Research Analyst at Thompson Davis & Co]

Great. Sounds good.

[Operator]

Thank you. Our next question comes from the line of John Tanwanteng of CJS Securities. Your line is now open.

[Jeremy Routh, Sales & Research Associate at CJS Securities]

It's Jeremy on for John. How should we think about capital allocation beyond CapEx? Given the stronger performance, has your preference shifted more towards repurchases versus debt paydown?

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

No. I think with where we're at now, I think we kind of go back to the priorities we had been stating all along. Let's get through the newbuild program and then let's start delevering. The buyback program we put in place was more a reaction to the softball that the market gave us where we just saw this huge depression in the stock price. So put the program in place, we're able to take some swings at it at a very depressed price.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Now we'll as long as we see the price where it's at or higher, not that we think it's properly valued now, but we'll just go back to the other priority. The program is still in place. If we see another huge disconnect, we can always start nibbling again. Right now, as I see it, let's get through the new build program and then let's start delevering.

[Jeremy Routh, Sales & Research Associate at CJS Securities]

Makes sense. Thank you. And then can you just discuss the expansion of the credit facility and kind of the rationale behind doing so?

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

Yes, a couple of things drove that. We did have on our second lien paper the ability to upsize it by $50,000,000 that expired during the second quarter. We weren't going to take it, but we did get have the opportunity to upsize the revolver at much more favorable pricing to the tune of $30 we did it. Also with the LNG work that we have and the progress we're making on the offshore energy, those projects typically require letter of credits as opposed to the base dredging business, which are usually surety bonds. So the revolver for us is not just a mechanism to borrow cash, it's also the facility that we use to issue letter of credit.

[Scott Kornblau, SVP & CFO at Great Lakes Dredge & Dock]

You'll see we're going to issue our 10 Q later today. We have roughly $60,000,000 of letter of credits outstanding right now to support the LNG and offshore energy backlog.

[Jeremy Routh, Sales & Research Associate at CJS Securities]

Awesome. Thank you.

[Operator]

Thank you. I'm showing no further questions at this time. So I would now like to turn it back to Eric Birch for closing remarks.

[Eric Birge, VP - IR & Finance at Great Lakes Dredge & Dock]

Thank you. We appreciate the support of our shareholders, employees, and business partners. And we thank you for joining us for our discussion today about the important developments and initiatives in our business. We look forward to speaking to you during next quarter's earnings. Thank you.

[Operator]

Thank you for your participation in today's conference. This does conclude the program. You may now disconnect.

Participants

Executives

• Eric Birge, VP - IR & Finance
• Lasse Petterson, CEO, President & Director
• Scott Kornblau, SVP & CFO

Analysts

• Joe Gomes, Senior Research Analyst at Noble Capital Markets
• Julio Romero, Equity Research Analyst at Sidoti & Company, LLC
• Kevin Gainey, Senior Research Analyst at Thompson Davis & Co
• Jeremy Routh, Sales & Research Associate at CJS Securities