HOUSTON, March 3, 2011 (GLOBE NEWSWIRE) -- Orion Marine Group, Inc. (NYSE:ORN) (the "Company"), a leading heavy civil marine contractor, today reported net income for the three months ended December 31, 2010, of $3.0 million ($0.11 diluted earnings per share). These results compare to net income of $4.0 million ($0.15 diluted earnings per share) for the same period a year ago. For the full year 2010, Orion Marine Group reported net income of $21.9 million ($0.81 diluted earnings per share), which compares to 2009 net income of $20.0 million ($0.84 diluted earnings per share). Full year 2010 earnings per share calculations include additional shares outstanding as a result of the secondary offering made during the third quarter 2009.
"During 2010, we saw many challenges and many accomplishments," said Mike Pearson, Orion Marine Group's President and Chief Executive Officer. "Although less than we initially expected, we continued to grow the business which resulted in record full year revenue with a solid bottom line performance and strong EBITDA margins. In fact, we ended 2010 with more than double the amount of revenue we had in 2005, while maintaining industry leading EBITDA margins."
Financial highlights of the Company's fourth quarter and full year 2010 include:
Fourth Quarter 2010
- Fourth quarter 2010 contract revenues were $90.4 million, an increase of 26.9%, as compared with fourth quarter of 2009 revenues of $71.2 million.
- Gross profit for the quarter was $11.6 million which represents a decrease of $1.9 million as compared with the fourth quarter of 2009. Gross profit margin for the quarter was 12.9%, which was lower than the prior year period of 19.0%. During the fourth quarter 2010 gross profit margin was impacted by production issues on a couple of jobs and changes in the mix of contracts as compared to the prior year period.
- Selling, General, and Administrative expenses for the fourth quarter 2010 were $7.2 million as compared to $7.3 in the prior year period.
- The Company's fourth quarter 2010 EBITDA was $9.3 million, representing a 10.3% EBITDA margin, which compares to fourth quarter 2009 EBITDA of $10.1 million, or a 14.2% EBITDA margin.
Full Year 2010
- Full year 2010 contract revenues increased to $353.1 million, up 20.3% year-over-year as compared with full year 2009 revenues of $293.5 million.
- Gross profit for the year was $65.2 million which represents an increase of $2.5 million as compared with the full year 2009. Gross profit margin for the year was 18.5%, which was down from 21.4% for the full year 2009. Gross profit margin was primarily impacted during the year by pricing pressure in the East Coast construction market.
- The Company self-performed approximately 82% of its work as measured by cost during 2010 as compared with 88% during the prior year period. Self performance was lower than the Company's historical average due to changes in the mix of contracts as compared to the prior year period.
- Selling, General, and Administrative expenses for the full year 2010 were $32.6 million as compared with $30.7 million in the prior year period.
- The Company's full year 2010 EBITDA was $53.6 million, representing a 15.2% EBITDA margin, which compares to full year 2009 EBITDA of $50.5 million, or a 17.2% EBITDA margin.
Backlog of work under contract as of December 31, 2010 was $194.5 million which compares with backlog under contract at December 31, 2009 of $252.9 million. Subsequent to the end of the year, the Company has been successful in continuing to obtain additional awards for new work. 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 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.
"We are comfortable with our backlog and we continue to see solid demand for our services," said Mark Stauffer, Orion Marine Group's Executive Vice President and Chief Financial Officer. "We urge you to continue to focus on long term results and not short term fluctuations. We continue to be an industry leader and ended 2010 with a strong stable balance sheet, positive year-over-year net income growth, positive year-over year EBITDA growth and a 20% growth in the top line. Our goal is to double revenues again during the next five years while continuing to deliver solid bottom line results. We will accomplish this through growth opportunities, strategic acquisitions, and new service lines to complement our core capabilities. We feel there is plenty of market to support this growth and are optimistic about the road ahead."
The Company expects to continue to see positive long-term trends in port expansion, U.S. infrastructure updates, coastal and wetland restoration projects, expansion in the cruise industry and projects involving dredging services. Currently the Company is tracking approximately $5 billion of future bid opportunities and continues to see strong bidding activity across its markets and geographic areas.
"Given some of the uncertainties in the general economic and political environment, we believe it is prudent to be cautious about 2011," said Mr. Pearson. "As previously stated, we believe it is reasonable to expect full year 2011 revenues will be at least flat as compared to 2010. Actual results could exceed our full year revenue expectation if there is an easing of pricing pressures on the East Coast, passage of a new highway funding bill, better than expected lettings from the Army Corps of Engineers as a result of Harbor Maintenance Trust Fund legislation, better than expected international opportunities, or the acceleration of port expansion projects in our market areas. We continue to expect full year 2011 EBITDA margins to be in the 14% to 16% range."
For the first quarter, 2011, the Company expects revenue will be at least flat as compared to the first quarter 2010 with EBITDA margins in the 14% to 16% range.
Conference Call Details
Orion Marine Group will conduct a telephone briefing to discuss its results for the fourth quarter 2010 at 10:00 a.m. Eastern Time/9:00 a.m. Central Time on Thursday, March 3, 2011. To listen to a live broadcast of this briefing, visit the Investor Relations section of the Company's website at . To participate in the call, please call the Orion Marine Group Fourth Quarter 2010 Earnings Conference Call at 800-638-5439; participant code 39051212.
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 Orion Marine Group
Orion Marine Group, Inc. provides a broad range of marine construction and specialty services on, over and under the water along the Gulf Coast, the Atlantic Seaboard, the West Coast, Canada and the Caribbean Basin and acts as a single source turn-key solution for its customers' marine contracting needs. Its heavy civil marine construction services include marine transportation facility construction, marine pipeline construction, marine environmental structures, dredging, and specialty services. Its specialty services include salvage, demolition, diving, surveying, towing and underwater inspection, excavation and repair. The Company is headquartered in Houston, Texas and has an almost 100-year legacy of successful operations.
The Orion Marine Group, Inc. logo is available at
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 Securities and Exchange Commission, including Regulation G. The non-GAAP financial information may be determined or calculated differently by other companies. By reporting such non-GAAP financial information, the Company does not intend to give such information greater prominence than comparable and other GAAP financial information, which information is of equal or greater importance.
Orion Marine Group defines EBITDA as net income before net interest expense, income taxes, depreciation and amortization. EBITDA margin is calculated by dividing EBITDA for the period by contract revenues for the period. The GAAP financial measure that is most directly comparable to EBITDA margin is operating margin, which represents operating income divided by contract revenues. EBITDA and EBITDA margin are used internally to evaluate current operating expense, operating efficiency, and operating profitability on a variable cost basis, by excluding the depreciation and amortization expenses, primarily related to capital expenditures and acquisitions, and net interest and tax expenses. Additionally, EBITDA and EBITDA margin provide useful information regarding the Company's ability to meet future debt repayment requirements and working capital requirements while providing an overall evaluation of the Company's financial condition. In addition, EBITDA is used internally for incentive compensation purposes. The Company includes EBITDA and EBITDA margin to provide transparency to investors as they are commonly used by investors and others in assessing performance. EBITDA and EBITDA margin have certain limitations as analytical tools and should not be used as a substitute for operating margin, net income, cash flows, or other data prepared in accordance with generally accepted accounting principles in the United States, or as a measure of the Company's profitability or liquidity.
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 Securities and Exchange Commission.
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 March 9, 2010, which is available on its website at or at the SEC's website at , for additional and more detailed discussion of risk factors that could cause actual results to differ materially from our current expectations, estimates or forecasts.
CONTACT: Orion Marine Group, Inc. Mark Stauffer, Executive Vice President & CFO Chris DeAlmeida, Director of Investor Relations 713-852-6506