"We once again delivered solid results for the quarter," said
Financial highlights of the Company's second quarter 2009 include:
Second Quarter 2009
* Second quarter 2009 contract revenues increased to$70.8 million , up 5.5% as compared with the second quarter of 2008. Revenue growth for the quarter was lower than the Company's second quarter revenue growth goal of 8% to 12% as a result of delays in project start dates related to fluctuations in timeframes for permitting, contract award, and notices to proceed from the customer. * Gross profit for the quarter was$18.9 million which represents an increase of$9.0 million or 92% as compared with the second quarter of 2008. Gross profit margin for the quarter was 26.7%, which is up 12 points from the prior year period, primarily due to improved project execution and performance. * Selling, General, and Administrative expenses for the second quarter 2009 were$8.7 million , which represents an increase of$3.0 million year-over-year. In the prior year period, the Company recovered in full a previously reserved receivable and benefitted from lower group medical and workers' compensation expenses. In the current year period, the Company increased its allowance for doubtful accounts to fully reserve a customer receivable based on that customer's bankruptcy filing during the second quarter. * The Company's second quarter 2009 EBITDA was$15.2 million , representing a 21.4% EBITDA margin, which compares to second quarter 2008 EBITDA of$9.3 million , or a 13.8% EBITDA margin. EBITDA margin for the quarter exceeded the Company's second quarter goal range of 15% to 17% primarily due to improved project execution and performance. * The Company self-performed approximately 90% of its work as measured by cost during the second quarter 2009 as compared with 86% in the prior year period.
Backlog of work under contract as of
"Overall we are pleased with the results of the second quarter," said
Outlook
The Company continues to see bid opportunities for port expansion, U.S. infrastructure improvements including bridge work over water, coastal and wetland restoration projects, and expansion in the cruise industry. Additionally, the Company expects to see additional bid opportunities in the future for repairs and enhancements to marine facilities as well as projects involving dredging services.
Looking at 2009 in detail, the Company is tracking potential bid opportunities of
The Company remains comfortable with its previously stated full year 2009 year-over-year revenue growth goal of 12% to 16% and its full year 2009 EBITDA margin goal of 14% to 18%. However, given the timing shifts of revenue during the second quarter and expected low material pricing which could reduce overall contract values, the Company believes its revenue growth for the full year 2009 could reasonably be at the lower end of the stated full year 2009 revenue growth goal range. Also, the Company believes the favorable EBITDA margins experienced in the first and second quarters will boost its full year EBITDA margin towards the middle to upper end of its full year 2009 EBITDA margin goal range.
"Overall we are well positioned for the remainder of 2009 and look forward to opportunities in 2010," said Mr. Pearson. "However, I want to remind investors that our business involves construction work, and certain things are beyond our control which can cause backlog, revenue and profitability to vary from our initial expectations. It is for that reason we ask investors to focus on long-term results and not quarterly fluctuations. I am pleased with our results so far this year and am excited about the opportunities ahead."
Conference Call Details
A replay of this briefing will be available on the Web site within 24 hours and will be archived for at least two weeks.
About
The
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, 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, 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, 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 Income
(In thousands, except share and per share information)
Three Months Ended
------------------
June 30, June 30,
2009 2008
---- ----
(Unaudited) (Unaudited)
Contract revenues $ 70,753 $ 67,070
Costs of contract revenues 51,878 57,240
---------- ----------
Gross profit 18,875 9,830
Selling, general and administrative expenses 8,739 5,695
---------- ----------
Operating income 10,136 4,135
---------- ----------
Interest income (95) (119)
Interest expense 231 364
---------- ----------
Interest (income) expense, net 136 245
---------- ----------
Income before income taxes 10,000 3,890
Income tax expense 3,714 1,489
---------- ----------
Net income $ 6,286 $ 2,401
========== ==========
Basic earnings per share--Common $ 0.29 $ 0.11
Diluted earnings per share--Common $ 0.28 $ 0.11
Shares used to compute earnings per share:
Basic--Common 21,622,219 21,565,324
Diluted--Common 22,148,304 21,845,972
Orion Marine Group, Inc. and Subsidiaries
EBITDA and EBITDA Margin Reconciliations
(In Thousands, except margin data)
Three Months Ended
------------------
June 30, June 30,
2009 2008
---- ----
(Unaudited) (Unaudited)
Net income $ 6,286 $ 2,401
Income tax expense 3,714 1,489
Interest (income) expense, net 136 245
Depreciation and amortization 5,028 5,133
---------- ----------
EBITDA(1) $ 15,164 $ 9,268
========== ==========
Operating Income Margin(2) 14.3% 6.2%
Impact of Depreciation and Amortization 7.1% 7.6%
---------- ----------
EBITDA margin(1) 21.4% 13.8%
========== ==========
----------------------------
(1) EBITDA is a non-GAAP measure that represents earnings before
interest, taxes, depreciation and amortization. EBITDA margin is a
non-GAAP measure calculated by dividing EBITDA by contract revenues.
(2) Operating income margin is calculated by dividing operating income
by contract revenues.
Orion Marine Group, Inc. and Subsidiaries
Supplementary Financial Information
(In Thousands)
Three Months Ended
------------------
June 30, June 30,
2009 2008
---- ----
Net cash flow from operating activities $ 23,667 $ 12,180
========== ==========
Cash and cash equivalents $ 44,003 $ 14,500
========== ==========
Term debt outstanding $ 29,966 $ 35,000
========== ==========
Capital Expenditures $ 4,745 $ 8,629
========== ==========
CONTACT:
Executive Vice President & CFO
Director of Investor Relations
713-852-6506