"We were pleased with solid asset utilization during the quarter," said
Financial highlights of the Company's first quarter 2015 include:
First Quarter 2015
-
First quarter 2015 contract revenue was
$81.5 million , which is comparable to the prior year period.
-
Gross profit for the quarter was
$8.5 million , which represents an increase of$0.8 million as compared with the first quarter of 2014. Gross profit margin for the quarter was 10.4%, which was higher than the prior year period of 9.4%. The increase was a result of continued incremental bid margin improvement along with a change in the mix of work performed in the quarter offset by higher than expected cost on certain projects.
-
Selling, General, and Administrative expenses for the first quarter 2015 were
$8.7 million as compared to$8.0 million in the prior year period. The increase in SG&A is primarily attributable to an increase in stock based compensation expense.
-
The Company's first quarter 2015 EBITDA was
$5.3 million , representing a 6.5% EBITDA margin, which compares to first quarter 2014 EBITDA of$5.4 million , or a 6.6% EBITDA margin.
Backlog of work under contract as of March 31, 2015, was
The Company reminds investors that backlog can fluctuate from period to period due to the timing and execution of contracts. Given the typical duration of the Company's projects, which generally range from three to nine months, the Company's backlog at any point in time usually represents only a portion of the revenue it expects to realize during a twelve-month period. Backlog consists of projects under contract that have either (a) not been started, or (b) are in progress and not yet complete, and the Company cannot guarantee that the revenue projected in its backlog will be realized, or, if realized, will result in earnings.
Outlook
"We remain optimistic for 2015," said Mr. Stauffer. "Demand from private and public sector clients continues to be strong. We are bidding on several large scale turn-key waterside infrastructure solutions for private sector clients, both domestically and abroad, specifically for midstream and downstream energy infrastructure customers and recreational customers. Additionally, local port authority opportunities remain solid, many of which are related to the upcoming completion of the
"Overall, we are pleased with both the amount of work we bid on and won during the first quarter of 2015," said
Despite these gaps, we are excited for the bid opportunities we see for the remainder of 2015 and we continue to see some pockets of pricing improvement. As a result of this high level of demand and the bids we currently have outstanding, we remain optimistic with regard to full year growth and margin improvement."
Conference Call Details
About
EBITDA and EBITDA Margin
This press release includes the financial measures "EBITDA" and "EBITDA margin." These measurements may be deemed "non-GAAP financial measures" under rules of the
A reconciliation of the Company's future EBITDA margin to the corresponding GAAP measure is not available as these are estimated goals for the performance of the overall operations over the planning period. These estimated goals are based on assumptions that may be affected by actual outcomes, including but not limited to the factors noted in the "forward looking statements" herein, in other releases, and in filings with the
Forward-Looking Statements
The matters discussed in this press release may constitute or include projections or other forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, the provisions of which the Company is availing itself. Certain forward-looking statements can be identified by the use of forward-looking terminology, such as 'believes', 'expects', 'may', 'will', 'could', 'should', 'seeks', 'approximately', 'intends', 'plans', 'estimates', or 'anticipates', or the negative thereof or other comparable terminology, or by discussions of strategy, plans, objectives, intentions, estimates, forecasts, outlook, assumptions, or goals. In particular, statements regarding future operations or results, including those set forth in this press release (including those under "Outlook" above), and any other statement, express or implied, concerning future operating results or the future generation of or ability to generate revenues, income, net income, profit, EBITDA, EBITDA margin, or cash flow, including to service debt, and including any estimates, forecasts or assumptions regarding future revenues or revenue growth, are forward-looking statements. Forward looking statements also include estimated project start date, anticipated revenues, and contract options which may or may not be awarded in the future. Forward looking statements involve risks, including those associated with the Company's fixed price contracts that impacts profits, unforeseen productivity delays that may alter the final profitability of the contract, cancellation of the contract by the customer for unforeseen reasons, delays or decreases in funding by the customer, levels and predictability of government funding or other governmental budgetary constraints and any potential contract options which may or may not be awarded in the future, and are the sole discretion of award by the customer. Past performance is not necessarily an indicator of future results. In light of these and other uncertainties, the inclusion of forward-looking statements in this press release should not be regarded as a representation by the Company that the Company's plans, estimates, forecasts, goals, intentions, or objectives will be achieved or realized. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company assumes no obligation to update information contained in this press release whether as a result of new developments or otherwise.
Please refer to the Company's Annual Report on Form 10-K, filed on
Orion Marine Group, Inc. and Subsidiaries | ||
Consolidated Statements of Operations | ||
(In thousands, except share and per share information) | ||
Three months ended March 31, | ||
2015 | 2014 | |
(Unaudited) | (Unaudited) | |
Contract revenues | $ 81,455 | $ 81,258 |
Costs of contract revenues | 72,999 | 73,611 |
Gross profit | 8,456 | 7,647 |
Selling, general and administrative expenses | 8,692 | 7,964 |
Loss from operations | (236) | (317) |
Other (expense) income | ||
Gain from sale of assets, net | 43 | 93 |
Interest income | 12 | 10 |
Interest expense | (238) | (130) |
Other expense, net | (183) | (27) |
Loss before income taxes | (419) | (344) |
Income tax benefit | (161) | (134) |
Net loss | (258) | (210) |
Basic loss per share | $ (0.01) | $ (0.01) |
Diluted loss per share | $ (0.01) | $ (0.01) |
Shares used to compute loss per share | ||
Basic | 27,604,681 | 27,397,877 |
Diluted | 27,604,681 | 27,397,877 |
Orion Marine Group, Inc. and Subsidiaries | ||
EBITDA and EBITDA Margin Reconciliations | ||
(In Thousands, except margin data) | ||
Three months ended March 31, | ||
2015 | 2014 | |
(Unaudited) | (Unaudited) | |
Net income loss | $ (258) | $ (210) |
Income tax benefit | (161) | (134) |
Interest expense, net | 226 | 120 |
Depreciation and amortization | 5,445 | 5,619 |
EBITDA | $ 5,252 | $ 5,395 |
Operating loss margin |
(0.2)% | (0.3)% |
Impact of depreciation and amortization | 6.7% | 6.9% |
EBITDA margin |
6.5% | 6.6% |
Orion Marine Group, Inc. and Subsidiaries | ||
Condensed Consolidated Balance Sheets | ||
(In Thousands) | ||
March 31, 2015 |
December 31, 2014 |
|
(Unaudited) | (Audited) | |
ASSETS | ||
Current assets: | ||
Cash and cash equivalents | $ 34,734 | $ 38,893 |
Accounts receivable: | ||
Trade, net of allowance of $0 | 27,387 | 36,905 |
Retainage | 15,011 | 15,883 |
Other | 1,619 | 1,998 |
Income taxes receivable | 101 | 333 |
Inventory | 6,723 | 6,487 |
Deferred tax asset | 1,733 | 1,755 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 47,104 | 44,581 |
Asset held for sale | 375 | 375 |
Prepaid expenses and other | 3,739 | 3,924 |
Total current assets | 138,526 | 151,134 |
Property and equipment, net | 162,057 | 161,773 |
Inventory, non-current | 5,508 | 5,508 |
Goodwill | 33,798 | 33,798 |
Intangible assets, net of amortization | 59 | 87 |
Total assets | $ 339,948 | $ 352,300 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Current liabilities: | ||
Current debt | $ 29,642 | $ 33,527 |
Accounts payable: | ||
Trade | 23,233 | 21,889 |
Retainage | 1,788 | 1,706 |
Accrued liabilities | 13,474 | 15,803 |
Taxes payable | 512 | 997 |
Billings in excess of costs and estimated earnings on uncompleted contracts | 9,152 | 16,704 |
Total current liabilities | 77,801 | 90,626 |
Long term debt | 3,348 | 3,480 |
Other long-term liabilities | 512 | 566 |
Deferred income taxes | 20,997 | 20,877 |
Deferred revenue | 15 | 34 |
Total liabilities | 102,673 | 115,583 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock -- $0.01 par value, 10,000,000 authorized, none issued | — | — |
Common stock -- $0.01 par value, 50,000,000 authorized, 27,841,840 and 27,710,775 issued; 27,520,648 and 27,393,045 outstanding at March 30, 2014 and December 31, 2013, respectively | 279 | 279 |
Treasury stock, 317,731 shares, at cost | (3,439) | (3,439) |
Additional paid-in capital | 167,249 | 166,433 |
Retained earnings | 73,186 | 73,444 |
Total stockholders' equity | 237,275 | 236,717 |
Total liabilities and stockholders' equity | $ 339,948 | $ 352,300 |
Orion Marine Group, Inc. and Subsidiaries | ||
Condensed Consolidated Statements of Cashflows | ||
(In Thousands) | ||
Three months ended March 31, | ||
2015 | 2014 | |
(Unaudited) | (Unaudited) | |
Cash flows from operating activities | ||
Net loss | $ (258) | $ (210) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 5,445 | 5,619 |
Bad debt recoveries | 1 | (7) |
Deferred income taxes | 144 | (34) |
Stock-based compensation | 788 | 407 |
Gain on sale of property and equipment | (44) | (93) |
Change in operating assets and liabilities: | ||
Accounts receivable | 10,768 | 8,851 |
Income tax receivable | 232 | — |
Inventory | (236) | (819) |
Prepaid expenses and other | 185 | 218 |
Costs and estimated earnings in excess of billings on uncompleted contracts | (2,883) | 8,300 |
Accounts payable | 1,427 | (11,867) |
Accrued liabilities | (2,383) | 1,032 |
Income tax payable | (485) | (86) |
Billings in excess of costs and estimated earnings on uncompleted contracts | (7,192) | (4,761) |
Deferred revenue | (19) | (14) |
Net cash provided by operating activities | 5,490 | 6,536 |
Cash flows from investing activities: | ||
Proceeds from sale of property and equipment | 52 | 174 |
Purchase of property and equipment | (5,712) | (2,005) |
Purchase of land | — | (22,199) |
Net cash used in investing activities | (5,660) | (24,030) |
Cash flows from financing activities: | ||
Borrowings from Credit Facility | — | 22,500 |
Contributions from non-controlling interest | — | (389) |
Payments made on borrowings from Credit Facility | (4,017) | — |
Exercise of stock options | 28 | 136 |
Net cash (used in) provided by financing activities | (3,989) | 22,247 |
Net change in cash and cash equivalents | (4,159) | 4,753 |
Cash and cash equivalents at beginning of period | 38,893 | 40,859 |
Cash and cash equivalents at end of period | $ 34,734 | $ 45,612 |
Supplemental disclosures of cash flow information: | ||
Cash paid during the period for: | ||
Interest | $ 238 | $ 165 |
Taxes (net of refunds) | $ (33) | $ (14) |
CONTACT:Orion Marine Group, Inc. Drew Swerdlow , Investor Relations Manager, 713-852-6582