Ladies and gentlemen, thank you for standing by. Welcome to the Babcock & Wilcox Second Quarter 2020 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 [Operator Instructions]. I would now like to hand the conference over to your speaker for today, Megan Wilson, Vice President Investor Relations. Please go ahead, ma’am.

Thank you, Chantal, and good afternoon, everyone. Welcome to Babcock & Wilcox Enterprises second quarter 2020 earnings conference call. I’m Megan Wilson, Vice President of Investor Relations at B&W. Joining me this afternoon are Kenny Young, B&W’s Chief Executive Officer and Louis Salamone, Chief Financial Officer, to discuss our second quarter results. During this call, certain statements we make will be forward-looking. These statements are subject to risks and uncertainties, including those set forth in our Safe Harbor provision for forward-looking statements that can be found at the end of our earnings press release and also in our Form 10-Q that was filed yesterday, and our Form 10-K that is on file with the SEC, and provide further detail about the risks related to our business. Additionally, except as required by law, we undertake no obligation to update any forward-looking statements. We also provide non-GAAP information regarding certain of our historical results to supplement the results provided in accordance with GAAP. This information should not be considered superior to or as a substitute for the comparable GAAP measures. A reconciliation of historical non-GAAP measures can be found in our second quarter earnings release published yesterday afternoon. With that, I will turn the call over to Kenny.

Thanks, Megan. Good afternoon, everyone, and thanks for joining. Like many companies around the world, our second quarter results were negatively impacted by COVID-19 here in the U.S. and internationally, as we saw delays in anticipated bookings and project deferrals across all three segments. Globally, we have and continue to take further steps to provide a safer working environment in our offices and manufacturing facilities and at our customers' sites. We greatly appreciate all the efforts of our employees they are taking to create a safer work environment, as well as the relentless support for our customers during this unprecedented time. Like other companies impacted by the pandemic, it is impossible for us to fully predict the extent or timing of further COVID-19 effects. However, based on current information from our customers, we expect the majority of our deferred projects to remobilize in late 2020 and throughout 2021, depending on certain location and project specific factors. More importantly, our pipeline is expanding with over $5 billion of identified projects that we expect to bid in the next three years, not including our parts and services. This pipeline is focused on renewable energy, environmental solutions and advanced technologies globally with roughly $2 billion for the B&W Renewable segment, $2 billion for the B&W Thermal segment, and $1 billion for the B&W Environmental segment. We continue to see significant opportunities to grow our business profitably with our improved project execution and efficient operational focus. Our focus is on bottom line results and strong cash management. As I've said before, during this challenging global pandemic, two key points encouraged and drive us forward at Babcock & Wilcox. We provide critical, essential infrastructure products and services, and our managers and employees are experienced, dedicated and more determined than ever. Our team continues to demonstrate…

Thank you, Kenny. Our second quarter consolidated revenues were $135.4 million. COVID-19 negatively impacted all of the segments in our business by delaying or deferring anticipated projects and bookings into later in 2020 or into 2021. Our GAAP consolidated operating loss was $7.7 million, which included restructuring, settlement and advisory costs of $4.4 million. Our GAAP loss from continuing operations was $18.1 million. This represents a $10.2 million improvement compared to the second quarter of 2019. Our consolidated adjusted EBITDA was $1.4 million. Adjusted EBITDA was adversely affected, again, by the impacts of COVID-19 across all of the segments of our business, and also was offset by the completion of several large construction projects in the Babcock & Wilcox segment as they completed at the end of 2019 and early 2020. While the positive impacts of our cost savings efforts over the last year and half maybe masked by the adverse impacts of COVID-19, we continue to see the increasing benefits of our previously implemented cost saving initiatives. This affects both cost of our operations and our SG&A costs. These cost saving initiatives helped drive a $7.5 million reduction in consolidated SG&A expense in the quarter. This is a 17.8% improvement, compared to the second quarter of 2019. These initiatives also helped drive adjusted gross profit in the Babcock & Wilcox segment to 27.9% this quarter, as compared to 18.8% in the same period of last year. We expect to continue to see the benefits of our cost saving initiatives in 2020 and into 2021 as these savings from the changes implemented in 2019 are fully implemented over time. Turning to our cash flow, balance sheet, and liquidity. Cash flow from operations in the second quarter was a use of approximately $13.8 million, and this was primarily for working capital…

Thanks, Lou. While we can't fully predict how COVID-19 will affect the timing of bookings and project progress in the near-term, we are seeing renewed opportunities emerging as many of our customers restart paused projects or undertake new projects and upgrades, leveraging our technology. We are pursuing and have won new grants and paid research opportunities to design and build new emerging technologies. Now with the launch of our new segmentation and organizational alignment, combined with the ongoing expansion of our geographic presence, our focus is on winning and executing quality projects as well as aftermarket services to serve our customers' needs for renewable energy, environmental solutions and efficient operations. We believe we have the technologies, expertise and opportunities to expand our renewable and environmental platform significantly in the next few years. And finally, before we close, I would encourage everyone to check out our new branding at www.babcock.com. I will now turn the call back over to the operator, who will assist us in taking your questions.

[Operator Instructions] Our first question comes from the line of a participant whose information was unable to be gathered. Caller, please state your name and company. Your line is open.

Hi. My name is David Kingsley [ph]. I'm an investor in BW. And my question, specifically, Kenny, is I was looking for an update on what's happening with potentially the Main Street lending program from the Fed and/or PPP loans that were available. I was hoping that you would try to get some relief federally. And I was wondering what the timing was? I know that it might have missed the end of the June 30 quarter.

Thanks, David. Like you, we follow very closely daily, as a matter of fact, all the developments in around the PPP programs, as well as -- and as Lou mentioned on the call, some of the payroll tax deferrals and other programs that have been provided through the COVID relief efforts by the U.S. government, as well as state and local governments as well, too, from that standpoint. So we do follow that constantly and closely as it relates to that. But many of those programs based on various conditions and other aspects don't apply to us. And so we continue to watch and monitor, which programs possibly could. And like other companies, we are more practical and possible voicing our references and concerns and priorities to our state and local officials as well as many of our federal officials as well, too, to try to get our voice heard in Congress, on Capitol Hill and in the state front as well, too. But -- so we do follow it very, very closely at this point in time as well.

Was PPP -- was BW just too large to get a couple of million dollars out of PPP? Was that the…?

Yeah. There's various aspects. PPP, we just -- we wouldn't qualify for or under at that point in time, other aspects in and around and some of the refinancing efforts that we had as well, too, put us in a position where we're not able to leverage some of those programs. So yeah, basically, we weren't able to take advantage of that. But we'll -- we do keep an eye, and hopefully some changes will take place that will open some of that back up.

Right. Okay. Thank you, Ken.

[Operator Instructions] There are no further questions at this time. I'll now turn the call back over to presenters for closing remarks.

Thank you for joining us. That concludes our conference call. A replay will be available for a limited time on our website later today.

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