Mistras Group, Inc. (NYSE:MG) Q1 2023 Earnings Conference Call May 4, 2023 9:00 AM ET

Company Participants

Dennis Bertolotti - President & Chief Executive Officer

Edward Prajzner - Executive Vice President & Chief Financial Officer

Conference Call Participants

Chris Sakai - Singular Research

Mitchell Pinheiro - Sturdivant & Co.

Brian Russo - Sidoti & Company

Operator

Thank you for joining Mistras Group's Conference Call for its First Quarter Ended March 31, 2023. My name is Jada and I'll be your event manager today. We'll be accepting questions after management's prepared remarks.

Participating on the call for Mistras will be Dennis Bertolotti, the company's President and Chief Executive Officer; and Ed Prajzner, Senior Executive Vice President and Chief Financial Officer.

I'd like to remind everyone that remarks made during this conference call will include forward-looking statements. The company's actual results could differ materially from those projected. Some of those factors that can cause actual results to differ are discussed in the company's most recent annual report on Form 10-K and other reports filed with the SEC. This discussion in this conference call will also include certain financial measures that were not prepared in accordance with US GAAP. Reconciliation of these non-US GAAP financial measures to the most directly comparable US GAAP financial measures can be found in the tables contained in yesterday's press release and in the company's related current report on Form 8-K. These reports are available at the company's website in the Investors section and on the SEC's website. I will now turn the conference over to Dennis Bertolotti.

Dennis Bertolotti

Thank you, Jada. Good morning, everyone, and thanks for joining us today. We continue to make significant progress capitalizing on our strong market position and innovative new technologies to grow Mistras and improve profitability. As evidence of this, in the first quarter, our revenue grew 5.5% in constant currency. Our gross margin expanded 270 basis points and we drove SG&A as a percentage of revenue down by over 40 basis points, resulting in an adjusted EBITDA of 88% increase.

These financial results were in line with our most recent outlook for the full year, which we are reaffirming today. And our overall financial condition also continued to improve, with our bank defined leverage ratio reduced to just under 3.25 as of quarter end, and we're well on our way to achieving our goal of being below 3.0 by year-end.