2Q2021 EBITDA of $20 million was dragged down by higher costs and downtime/delays due to COVID-19. For the second consecutive quarter, 2Q2021 operating results were softer than expected due to COVID-19 disruptions and unexpected downtime. Despite increasing vaccination rates amongst crews, extensive testing and preventive measures, several vessels were sidelined and scheduling was disrupted again. The number of days of downtime was not quantified, but extra direct costs totaled $3.0 million, which compares to 23 days of downtime and extra direct costs of $4.3 million in 1Q2021.Fine tuning 2021 EBITDA estimate. 1H2021 start slow due to COVID-19 issues, but 2H2021 should recover. Our EBITDA estimate of $132.3 million is lower than our previous estimate of $146 million and down compared to 2020 EBITDA of $151.1 million due to a 300 basis point drop in EBITDA margin to 17.6%, mainly due to strong outperformance on several projects last year and the negative impact of COVID-19 this year.Backlog down, but dredging market outlook remains solid. Even though backlog fell back again to $454 million from $486 million in 1Q2021 and $559 million in 4Q2020, we remain positive on the dredging market outlook. Infrastructure legislation that boosts port spending and increases the USACE budget could be positive for fiscal year 2022-23 budgets.Fleet renewal program moving ahead and improved credit profile smoothed the way for successful debt refinancing. While the steady decline in net debt reversed in 1Q2021, net debt dropped by $4 million to $144 million in 2Q2021. The improved credit profile helped refinance the debt on attractive terms and positions GLDD to enhance the asset base from a position of strength using mostly operating cash flow.Maintain Outperform rating and price target of $17.05/share due to recent awards, the fleet renewal program and disciplined capital allocation. While softer 2Q2021 results pushed the stock down almost 4% yesterday, the stock is still up 11% this year. We attribute most of the shortfall to COVID-19, which should be transitory, the risk/reward profile remains favorable so we expect the stock to rebound. Plus, debt refinancing, FID on the hopper barge new build program and the multi-service CAT vessels are positives and other potential catalysts include infrastructure legislation and FID on the rock dumping barge. Read More >>