"During the second quarter we had strong utilization on our construction equipment and improvements in dredge utilization," said
Financial highlights of the Company's second quarter 2013 include:
-
Second quarter 2013 contract revenue was
$84.1 million , an increase of 25%, as compared with second quarter 2012 revenue of$67.1 million .
-
The Company self-performed approximately 82% of its work as measured by cost during the second quarter 2013, which was the same in the prior year period.
-
Gross profit for the quarter was
$7.8 million , which represents an increase of$8.0 million as compared with the second quarter of 2012. Gross profit margin for the quarter was 9.3%, which was higher than the prior year period of negative 0.3%. During the second quarter of 2013, gross profit margin improved as a result of improved equipment utilization as compared with the prior year period. Margin in the prior year period was also driven down due to idle crews and equipment following project completions.
-
Selling, General, and Administrative expenses for the second quarter 2013 were
$7.8 million as compared to$7.5 million in the prior year period. The increase is primarily related to additional overhead expenses as a result of the acquisition made in late 2012.
-
The Company's second quarter 2013 EBITDA was
$5.7 million , representing a 6.7% EBITDA margin, which compares to second quarter 2012 EBITDA of negative$2.4 million , or a negative 3.5% EBITDA margin.
Backlog of work under contract as of
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
"Demand for our services remains robust as we track over
"The second quarter was very successful in terms of winning new work," said
Currently, we have over
As we look ahead, it is not unreasonable to expect profitable results for the full year given the current backlog levels and bid market opportunities. However, we still have gaps to fill in both the third and fourth quarters, as much of the recently booked backlog will extend into 2014. As always, we remain committed to managing a conservative balance sheet, maintaining strong project execution, and increasing shareholder value."
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, 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 June 30, | Six months ended June 30, | |||
2013 | 2012 | 2013 | 2012 | |
Contract revenues | 84,081 | 67,132 | 159,140 | 118,022 |
Costs of contract revenues | 76,250 | 67,349 | 145,479 | 121,067 |
Gross profit (loss) | 7,831 | (217) | 13,661 | (3,045) |
Selling, general and administrative expenses | 7,826 | 7,478 | 15,517 | 14,569 |
Income (loss) from operations | 5 | (7,695) | (1,856) | (17,614) |
Other income (expense) | ||||
Other income | 316 | 4 | 614 | 184 |
Interest income | 1 | 8 | 12 | 19 |
Interest expense | (132) | (234) | (316) | (403) |
Other (income) expense, net | 185 | (222) | 310 | (200) |
Income (loss) before income taxes | 190 | (7,917) | (1,546) | (17,814) |
Income tax benefit | (22) | (2,497) | (661) | (6,057) |
Net income (loss) | $ 212 | $ (5,420) | $ (885) | $ (11,757) |
Net loss attributable to noncontrolling interest | (18) | — | (25) | — |
Net income (loss) attributable to Orion common stockholders | $ 230 | $ (5,420) | $ (860) | $ (11,757) |
Basic income (loss) per share | $ 0.01 | $ (0.20) | $ (0.03) | $ (0.43) |
Diluted income (loss) per share | $ 0.01 | $ (0.20) | $ (0.03) | $ (0.43) |
Shares used to compute income (loss) per share | ||||
Basic | 27,270,367 | 27,121,417 | 27,250,268 | 27,120,593 |
Diluted | 27,600,661 | 27,121,417 | 27,250,268 | 27,120,593 |
Orion Marine Group, Inc. and Subsidiaries | ||||
EBITDA and EBITDA Margin Reconciliations | ||||
(In Thousands, except margin data) | ||||
Three Months Ended | Six Months Ended | |||
June 30, 2013 | June 30, 2012 | June 30, 2013 | June 30, 2012 | |
(Unaudited) | (Unaudited) | (Unaudited) | (Unaudited) | |
Net income / (loss) | $ 212 | $ (5,420) | $ (885) | $ (11,757) |
Income tax expense | (22) | (2,497) | (661) | (6,057) |
Interest expense, net | 131 | 226 | 304 | 384 |
Depreciation and amortization | 5,350 | 5,312 | 10,728 | 10,691 |
EBITDA | $ 5,671 | $ (2,379) | $ 9,486 | $ (6,739) |
Operating (loss) / income margin | 0.4% | (11.4)% | (0.7)% | (14.8)% |
Impact of depreciation and amortization | 6.3% | 7.9% | 6.7% | 9.1% |
EBITDA margin | 6.7% | (3.5)% | 6.0% | (5.7)% |
Orion Marine Group, Inc. and Subsidiaries | ||
Supplementary Financial Information | ||
(In Thousands) | ||
June 30, | December 31, | |
2013 | 2012 | |
ASSETS | ||
Current assets: | ||
Cash and cash equivalents | $ 40,584 | $ 43,084 |
Accounts receivable: | — | — |
Trade, net of allowance of $0 | 32,661 | 45,072 |
Retainage | 6,790 | 8,213 |
Other | 641 | 1,712 |
Income taxes receivable | 2,842 | 3,110 |
Note receivable | 46 | 46 |
Inventory | 5,223 | 4,354 |
Deferred tax asset | 37 | 37 |
Costs and estimated earnings in excess of billings on uncompleted contracts | 19,892 | 19,245 |
Asset held for sale | 920 | 920 |
Prepaid expenses and other | 1,897 | 2,857 |
Total current assets | 111,533 | 128,650 |
Property and equipment, net | 147,069 | 150,671 |
Accounts receivable, long-term | 1,410 | 1,410 |
Inventory, non-current | 915 | 915 |
Goodwill | 34,817 | 34,817 |
Intangible assets, net of amortization | 386 | 627 |
Other assets | 220 | 225 |
Total assets | $ 296,350 | $ 317,315 |
LIABILITIES AND STOCKHOLDERS' EQUITY | ||
Current liabilities: | ||
Current debt | $ 9,343 | $ 12,621 |
Accounts payable: | ||
Trade | 20,054 | 28,744 |
Retainage | 1,799 | 2,433 |
Accrued liabilities | 9,401 | 12,456 |
Taxes payable | 432 | 252 |
Billings in excess of costs and estimated earnings on uncompleted contracts | 10,669 | 16,369 |
Total current liabilities | 51,698 | 72,875 |
Long-term debt | — | — |
Other long-term liabilities | 857 | 564 |
Deferred income taxes | 17,654 | 18,496 |
Deferred revenue | 117 | 146 |
Total liabilities | 70,326 | 92,081 |
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, 27,627,321 and 27,530,220 issued; 27,309,590 and 27,212,489 outstanding at June 30, 2013 and December 31, 2012, respectively | 277 | 275 |
Treasury stock, 317,731 shares, at cost | (3,003) | (3,003) |
Additional paid-in capital | 162,613 | 160,973 |
Retained earnings | 66,079 | 66,939 |
Equity attributable to common stockholders | 225,966 | 225,184 |
Noncontrolling interest | 58 | 50 |
Total stockholders' equity | 226,024 | 225,234 |
Total liabilities and stockholders' equity | $ 296,350 | $ 317,315 |
Orion Marine Group, Inc. and Subsidiaries | ||
Supplementary Financial Information | ||
(In Thousands) | ||
Six months ended June 30, | ||
2013 | 2012 | |
Cash flows from operating activities | ||
Net loss | $ (885) | $ (11,757) |
Adjustments to reconcile net loss to net cash provided by (used in) operating activities: | ||
Depreciation and amortization | 10,728 | 10,691 |
Deferred financing cost amortization | 35 | 139 |
Bad debt recoveries | (3) | (1) |
Deferred income taxes | (747) | (2,866) |
Stock-based compensation | 1,132 | 1,526 |
Gain on sale of property and equipment | (48) | (93) |
Gain on bargain purchase from acquisition of a business | — | — |
Accounts receivable | 14,905 | (13,797) |
Income tax receivable | 269 | (3,222) |
Inventory | (869) | (430) |
Note receivable | — | 5 |
Prepaid expenses and other | 930 | (149) |
Restricted cash | — | — |
Costs and estimated earnings in excess of billings on uncompleted contracts | (647) | 5,721 |
Accounts payable | (9,324) | 4,229 |
Accrued liabilities | (2,762) | (468) |
Income tax payable | 86 | — |
Billings in excess of costs and estimated earnings on uncompleted contracts | (5,700) | 8,882 |
Deferred revenue | (29) | (28) |
Net cash provided by (used in) operating activities | 7,071 | (1,618) |
Cash flows from investing activities: | ||
Proceeds from sale of property and equipment | 81 | 252 |
Purchase of property and equipment | (6,917) | (18,689) |
Net cash used in investing activities | (6,836) | (18,437) |
Cash flows from financing activities: | ||
Borrowings from Credit Facility | — | 13,000 |
Payments made on borrowings from Credit Facility | (3,278) | — |
Contributions from non-controlling interest | 33 | — |
Exercise of stock options | 510 | 13 |
Increase in loan costs | — | (4) |
Net cash (used in) provided by financing activities | (2,735) | 13,009 |
Net change in cash and cash equivalents | (2,500) | (7,046) |
Cash and cash equivalents at beginning of period | 43,084 | 38,979 |
Cash and cash equivalents at end of period | $ 40,584 | $ 31,933 |
Supplemental disclosures of cash flow information: | ||
Cash paid during the period for: | ||
Interest | $ 337 | $ 350 |
Taxes (net of refunds) | $ (269) | $ 30 |
CONTACT:Orion Marine Group, Inc. Mark Stauffer , Executive Vice President & CFOChris DeAlmeida , Vice President, Accounting & Finance, 713-852-6506 Drew Swerdlow, Sr. Analyst, Finance & Investor Relations, 713-852-6582