Smith-Midland Corp. (SMID)

[littlefish]

Sorry was slow to get back to you here.

Not much on the North Carolina $2 billion fund passage as far as SMID is concerned at this point sounds like.

Simple business, simple management team, and quite busy so probably good for them to focus on their core competencies right now with a fair amount of highway work getting going as the year progresses in Va and NC.

Assuming they do close on the SC place, it does seem Georgia would be within their reach for barrier rentals using the satellite idea they had previously brought up in 2014 although the offloaded barrier contract they would start with in SC is for barrier sales not rentals.

So from what I'm understanding, they would start with barrier production out of there to get the place up and running profitably and then over time move up to stuff like Slenderwall and probably Softsound Soundwall as things progress and markets dictate.

If they can get barriers going out of there, they have a big yard for storage (unlike North Carolina where they have very limited storage area). That might help expedite the idea of setting up satellites for barrier rentals/sales like they have at 6 places already (think most of their satellite locations right now are heavily tilted more north of North Carolina).

Would be nice if the company could advertise and leverage their high profile track record for barrier rentals (Super Bowl, Pres Inauguration, Pope visit, etc) to get the satellites more up and running for high profile events in a wider geographic area now that the market has picked up considerably from 2014 when satellite idea was first brought up by chairman.

I did notice that Q3 2015 had roughly $1 mill in barrier rentals outside Pope stuff and Q4 had an unseasonably high $450K for Q4. Hopefully that is partly due to some success from satellite branches, rentals are higher margin usually.

As some of these booked contracts get run thru production, I'm more hopeful margins will start to expand as newer contracts start production and new bids are won.

There's often a bit of lag between cement price increases (2014), ready-mix price increases (2015), and precast price increases (2016 hopefully?). For now it is a bit of wait and see to where things go come Q2's and Q3's more productive seasons.

At least they're busy and their yards are full as Q2 ramps up. I think they're on the right track as long as they don't misstep and the industry overall IMO is giving them some tailwind weather for the coming years. :)