In Q1, the team took decisive action to reduce SG&A by $16 million in the fiscal year and just over $17 million on an annualized basis.
During the second quarter, the team has further reduced expected SG&A spending by an additional $9 million in the fiscal year.
In addition, we have reduced manufacturing overhead by an additional $6 million, including a rooftop consolidation that will improve absorption on lower volume in Q4 and beyond.
We also believe we are well on track to deliver the $3.9 million in continuous improvement cost savings through our manufacturing operations.
Our second quarter showed sequential improvement in many areas with revenue of $66.4 million.
While down 35% from a record prior-year quarter, revenue grew 17% sequentially.
Adjusted EBITDA of $10.5 million was down 50% from prior year, but up 661% or $9.1 million from Q1 on improved volume and cost reduction actions.
Gross margins for the quarter were 43.6%, down 57 basis points from prior year, but up 120 basis points sequentially.
GAAP and adjusted earnings per share were $0.06 a share and $0.12 a share, respectively, during the quarter, showing positive momentum on the sequential volume growth and cost reduction efforts.
We were pleased with bookings for the quarter at $75.7 million, which were down 18% from prior year, but up 25% sequentially relative to the Q1 27% shortfall to prior year.
Our book-to-bill of 1.14 was positive for the third consecutive quarter with backlog growing by 8% sequentially and 16% year-over-year.
In addition, margins in backlog improved by 420 basis points during the quarter on a positive mix of business.
We did see sequential improvement in our Q2 quick turn business of 14% when compared to Q1 on a relative basis to prior year quarters.
We continue to generate positive cash flows from our operations of $9.3 million during the second quarter, which enabled $4.4 million in debt repayment.
We see further opportunities to free up an additional $10 million in cash from the balance sheet by year-end.
Upstream, which represents approximately 14% of our revenues and integrated oil companies have been the hardest hit.
Transportation represents around 3% of our revenues in fiscal year 2020 and is a growing segment of our business that offers an opportunity to diversify our end markets.
They are: First, the safety of our employees and customers; second, aligning cost structure to the level of incoming business; third, driving continuous improvement programs to achieve the targeted $3.9 million in savings during the fiscal year; fourth, cash management; and fifth, investing for future growth.
With Q2 revenues down 35% from prior year and bookings down 18%, we expect the revenue shortfall to prior year to begin to moderate in Q3 and Q4.
We also expect the cost reductions to begin to have a meaningful impact to bottom line performance in the back half of the year with decremental margins in the 25% to 30% range.
The actions we have taken this year have positioned the business to deliver 100 basis points or more of EBITDA margin expansion during a downturn, and the team is hard at work to build a path to deliver similar or greater margin expansion in the subsequent year.
During the quarter, we recorded $2 million of restructuring cost related to the Q2 cost out actions.
And we expect these cost out actions, including the Q1 reduction in force, to reduce SG&A to approximately $34 million to $35 million for the second half of this fiscal year.
And we believe approximately 80% of these reductions are structural in nature and will provide incremental operating leverage when growth returns.
And since May of this year, we have reduced our SG&A by approximately 24% from $100 million down to $76 million to $77 million.
Also during Q2, our Canadian subsidiaries qualified for and received a $1.4 million benefit from the Canadian Emergency Wage Subsidy program.
And $400,000 of this benefit was recorded under cost of sales, while the remainder impacted SG&A.
And While we have faced significant challenges in our P&L-related to COVID-19 and the sustained decline in oil prices, our balance sheet remained strong and our cash and investments balance at the end of September improved by $51.4 million.
And we also paid down $4.4 million in debt and generated $7.2 million in free cash flow.
Our capex spend for the second quarter totaled $2 million, and that's inclusive of both growth and maintenance capital.
And we expect fiscal '21 capex to be approximately $4.6 million and that's a year-on-year reduction of 54%.
Our net debt to EBITDA ratio was 2.9 times at the end of Q2.
Our revenue this past quarter totaled $66.4 million and that's up sequentially by 17% and down by 35% against the prior year quarter, and was in line with our expectations for Q2.
Our legacy revenue mix between MRO/UE and Greenfield was 64% and 36%, respectively, versus a 53% and 47% in Q2 of fiscal year '20.
And FX decreased total revenue by $1.1 million in the quarter.
And in constant currency, our revenue declined by 34%.
Orders for the quarter totaled $75.7 million, up sequentially by 25%.
And relative to the prior year quarter, our orders declined by 18%, and that's an improvement from the Q1 decrease of 27%.
And our backlog of orders ended September at $118.7 million, and that's the highest level in the last 18 months, albeit under depressed revenues.
And due to cost out actions and higher margin projects, we have seen our backlog margins improved to 33.4%, and that's a 420 basis point improvement on a sequential basis.
Our book-to-bill for the quarter was positive at 1.14, and that marks the third consecutive quarter of a positive book-to-bill.
In terms of gross margins, margins were 43.6%.
And although they were down by 57 basis points versus the prior-year comp period, they were up sequentially by 114 basis points.
And gross margins were positively impacted by 63 bps due to the Canadian Emergency Wage Subsidy program.
Gross profit in the quarter declined by $16.5 million and that's attributable to the volume and revenue decline of 35%.
And looking forward to the second half of this fiscal year, we expect gross margins to improve by 100 basis points or more due to the benefits of cost reductions, even in light of the anticipated reduction in year-on-year volumes and an increase in the mix of our high margin on both a gross and net construct maintenance business.
Operating expenses for the quarter, that is SG&A and this excludes depreciation and amortization of intangibles, totaled $21 million versus $25.4 million in the prior year.
And SG&A expenses included $2 million of restructuring cost.
Normalized for the Canadian Wage Subsidy program and the restructuring charge, our SG&A on a pro forma basis totaled $19.9 million.
And as mentioned earlier, we expect our second half SG&A to be in the $34 million to $35 million range, inclusive of the recent spending reduction actions.
GAAP earnings per share for the quarter totaled $0.06 a share compared to the prior year quarter of $0.21, and that's a decline of $0.15 a share.
Adjusted EPS, as defined by GAAP earnings per share less amortization expenses and any one-time charges, totaled $0.12 a share relative to $0.29 a share in the prior year quarter.
And versus the prior year comparison period, adjusted EBITDA declined by 50% and adjusted EBITDA as a percent of revenue improved to 16%, and that's an increase of 1,300 basis points versus the prior sequential quarter.
And adjusted EBITDA totaled $10.5 million this past quarter.
Free cash flow was positive for the quarter by $7.2 million.
For Q2 of '21, we generated pre-tax income of $1.2 million and recorded a tax benefit of $627,000.
And as a result, we reversed $1.4 million of previously recorded GILTI tax.
And for the remainder of fiscal year '21 and the out years, we expect our tax rate to be 26% on a consolidated basis.
In the quarter, cash grew by $3.1 million to $51.4 million, and we generated $9.2 million from working capital.
And over the last 12 months, we have paid down $30.3 million in debt.

Summary:
GAAP and adjusted earnings per share were $0.06 a share and $0.12 a share, respectively, during the quarter, showing positive momentum on the sequential volume growth and cost reduction efforts.
Orders for the quarter totaled $75.7 million, up sequentially by 25%.
And our backlog of orders ended September at $118.7 million, and that's the highest level in the last 18 months, albeit under depressed revenues.
Gross profit in the quarter declined by $16.5 million and that's attributable to the volume and revenue decline of 35%.
GAAP earnings per share for the quarter totaled $0.06 a share compared to the prior year quarter of $0.21, and that's a decline of $0.15 a share.
Adjusted EPS, as defined by GAAP earnings per share less amortization expenses and any one-time charges, totaled $0.12 a share relative to $0.29 a share in the prior year quarter.