ORION GROUP HOLDINGS, INC. REPORTS SECOND QUARTER 2019 RESULTS
Houston, Texas, Wednesday, July 31, 2019 -- Orion Group Holdings, Inc. (NYSE: ORN) (the “Company”), a leading specialty construction company, today reported a net loss of $1.6 million ($0.06 diluted loss per share) for the second quarter ended June 30, 2019. Second quarter highlights are discussed below.
Second Quarter 2019 Highlights
• | Contract revenues were $166.0 million, up 3.9% from $159.8 million for the second quarter of 2018. Operating loss was $0.4 million for the second quarter of 2019 compared to operating income of $4.6 million for the second quarter of 2018. |
• | Net loss was $1.6 million ($0.06 diluted loss per share) for the second quarter of 2019 compared to net income of $2.2 million ($0.08 diluted earnings per share) for the second quarter of 2018. |
• | The second quarter 2019 net loss included $1.9 million ($0.07 per diluted share) of non-recurring costs and other charges. Second quarter 2019 adjusted net income was $0.3 million ($0.01 diluted earnings per share). (Please see page 8 of this release for a reconciliation of adjusted net income.) |
• | EBITDA, adjusted to exclude the impact of the aforementioned non-recurring costs, was $9.0 million in the second quarter of 2019, which compares to adjusted EBITDA of $12.5 million for the second quarter of 2018. (Please see page 9 of this release for an explanation of EBITDA, adjusted EBITDA and a reconciliation to the nearest GAAP measure.) |
• | Backlog reached a record high of $661.0 million on a second quarter book-to-bill of 2.50x. |
“Our second quarter revenues increased both year-over-year and sequentially as our Marine business delivered an improved top-line performance,” stated Mark Stauffer, Orion Group Holding’s President and Chief Executive Officer. “Additionally, adjusted EBITDA for our Marine segment increased on a sequential basis reflecting both higher revenues and improving execution. Our Concrete business results reflected bid margin pressures and the runoff of weather impacted projects, however, we are looking forward to an improvement in the performance in this segment, as the impacts of our Invest, Scale, and Grow (ISG) initiative begin to take hold. Backlog reached an all-time high for Orion, with both segments up significantly relative to the end of the second quarter of 2018. Marine backlog more than doubled on a sequential basis following the booking of multiple large projects over the past several months. We continue to see excellent prospects for additional new awards in both segments, particularly for large project opportunities.”
“We were also pleased with the positive cash flow from operations that we generated in the quarter. We expect our cash performance to strengthen as the year progresses driven by higher EBITDA and working capital improvement. Our balance sheet provides us with the financial flexibility to fund our operations and ISG initiative, and we intend to use free cash flow to further enhance liquidity.”
Mr. Stauffer concluded, “The operational transformation underway at Orion gives us increasing confidence in our ability to deliver profitability in the second half of 2019, and for 2020. Our record backlog positions us well to grow our top-line, and as our ISG program rolls out, we anticipate revenues generated will carry
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expanding margins. With improved profitability and free cash flow we expect to be able to materially enhance our financial position and deliver meaningful increases in value for our shareholders.”
Consolidated Results for Second Quarter 2019 Compared to Second Quarter 2018
• | Contract revenues were $166.0 million, up 3.9% as compared to $159.8 million. The increase was primarily driven by execution on several larger projects in backlog by our Marine segment. |
• | Gross profit was $15.0 million, as compared to $19.5 million. Gross profit margin was 9.0%, as compared to 12.2%. The decrease reflects a shift in timing and mix of projects. More specifically, in the second quarter of 2018 we completed a large Marine project and realized significant cost savings contributing to a strong gross margin for that period. |
• | Selling, General, and Administrative expenses were $15.1 million, as compared to $14.7 million. The increase predominantly reflects $1.7 million of non-recurring professional and other fees related to the Company’s business process review and the development of ISG performance improvement initiative. |
• | Operating loss was $0.4 million as compared to operating income of $4.6 million. The operating loss in the second quarter of 2019 reflects the aforementioned factors that reduced gross margin and the business process-review and ISG-related costs. |
• | EBITDA was $7.3 million, representing a 4.4% EBITDA margin, as compared to EBITDA of $12.5 million, or a 7.8% EBITDA margin. When adjusted for the aforementioned charges and other non-recurring costs, adjusted EBITDA for the second quarter of 2019 was $9.0 million, representing a 5.4% EBITDA margin. (Please see page 9 of this release for an explanation of EBITDA, Adjusted EBITDA and a reconciliation to the nearest GAAP measure.) |
Backlog
Backlog of work under contract as of June 30, 2019 was $661.0 million, which compares with backlog under contract at June 30, 2018 of $340.6 million, an increase of 94%. The second quarter 2019 ending backlog was comprised of $477.0 million of Marine segment projects, and $184.0 million of work for the Concrete segment. Currently, the Company has $1.3 billion worth of bids outstanding, including approximately $69.3 million on which it is the apparent low bidder, or have been awarded contracts subsequent to the end of the second quarter of 2019, of which approximately $14.4 million pertains to the Marine segment and approximately $54.9 million to the Concrete segment.
“During the second quarter, we bid on approximately $1.1 billion of work and were successful on approximately $416 million of these bids,” stated Robert Tabb, Orion Group Holding's Vice President and Chief Financial Officer. “This resulted in a 2.50 times book-to-bill ratio and a win rate of 38.6%. In the Marine segment, we bid on approximately $493 million during the second quarter 2019 and were successful on $347 million, representing a win rate of 70.4% and a book-to-bill ratio of 3.89 times. In the Concrete segment we bid on approximately $584 million of work and were awarded approximately $69 million, representing a win rate of 11.8% and a book-to-bill ratio of 0.89 times."
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. 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
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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.
Invest, Scale, and Grow Initiative
“During the second quarter, we concluded the business process review we announced at the beginning of the year and the development of the ISG initiative. The implementation of ISG has now begun,” stated Mr. Stauffer. “The end goal of our ISG initiative is to generate performance from both of our business segments that consistently meets our expectations and aligns with our strategic plan. The areas of focus for our ISG program are labor management, equipment management, project execution and corporate process. In each of these areas we’re taking steps to enhance and improve the functionality of data and reporting to provide better visibility, leading to better efficiencies and cost control. In each of these areas we’re reinforcing our expectations and accountability to complete our projects with margins at or above as-bid margins. We’ve enhanced or upgraded personnel in key positions across our organization, and streamlined processes, leading to reduced headcount. We’re laying the groundwork to implement a shared services platform across our segments to eliminate duplication of efforts and costs, which along with other measures, when fully implemented, will drive total SG&A expense to at or below 8.5% of revenues on an annual basis. We remain acutely focused on delivering improved results as we progress through 2019 and into 2020.”
Conference Call Details
Orion Group Holdings will host a conference call to discuss results for the second quarter 2019 at 10:00 a.m. Eastern Time/9:00 a.m. Central Time on Thursday, August 1, 2019. To listen to a live webcast of the conference call, or access the replay, visit the Calendar of Events page of the Investor Relations section of the website at www.oriongroupholdingsinc.com. To participate in the call, please dial the Orion Group Holdings, Inc. Second Quarter 2019 Earnings Conference Call at 201-493-6739.
About Orion Group Holdings
Orion Group Holdings, Inc., a leading specialty construction company, provides services in the Infrastructure, Industrial, and Building sectors through its marine construction segment and its concrete construction in the continental United States, Alaska, Canada and the Caribbean Basin. The Company’s marine construction segment services includes marine transportation facility construction, marine pipeline construction, marine environmental structures, dredging of waterways, channels and ports, environmental dredging, design, and specialty services. Its commercial concrete segment provides turnkey concrete construction services including pour and finish, dirt work, layout, forming, rebar, and mesh across the light commercial, structural and other associated business areas. The Company is headquartered in Houston, Texas with regional offices throughout its operating areas.
Non-GAAP Financial Measures
This press release includes the financial measures “adjusted net income,” “adjusted earnings per share,” “EBITDA,” "Adjusted EBITDA" and “Adjusted EBITDA margin." These measurements are “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.
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Adjusted net income and adjusted earnings per share are not an alternative to net income or earnings per share. Adjusted net income and adjusted earnings per share exclude certain items that management believes impairs a meaningful comparison of operating results. The company believes these adjusted financial measures are a useful adjunct to earnings calculated in accordance with GAAP because management uses adjusted net income available to common stockholders to evaluate the company's operational trends and performance relative to other companies. Generally, items excluded, are one-time items or items whose timing or amount cannot be reasonably estimated. Accordingly, any guidance provided by the company generally excludes information regarding these types of items.
Orion Group Holdings defines EBITDA as net income before net interest expense, income taxes, depreciation and amortization. Adjusted EBITDA is calculated by adjusting EBITDA for certain items that management believes impairs a meaningful comparison of operating results. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA for the period by contract revenues for the period. The GAAP financial measure that is most directly comparable to EBITDA and Adjusted EBITDA is net income, while the GAAP financial measure that is most directly comparable to Adjusted EBITDA margin is operating margin, which represents operating income divided by contract revenues. EBITDA, Adjusted EBITDA and Adjusted 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, Adjusted EBITDA and Adjusted EBITDA margin provide useful information regarding the Company's ability to meet future debt service 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, Adjusted EBITDA and Adjusted EBITDA margin to provide transparency to investors as they are commonly used by investors and others in assessing performance. EBITDA, Adjusted EBITDA and Adjusted 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.
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 “Update on Scale and Growth Initiative” 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, gross profit, EBITDA, Adjusted EBITDA, Adjusted 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,
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and are at 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 27, 2019, which is available on its website at www.oriongroupholdingsinc.com or at the SEC's website at www.sec.gov, 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: -OR- INVESTOR RELATIONS COUNSEL:
Orion Group Holdings Inc. The Equity Group Inc.
Robert Tabb, Vice President & CFO Fred Buonocore, CFA
(713) 852-6500 (212) 836-9607
www.oriongroupholdingsinc.com
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Orion Group Holdings, Inc. and Subsidiaries
Consolidated Statements of Operations
(In Thousands, Except Share and Per Share Information)
(Unaudited)
Three months ended June 30, | Six months ended June 30, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Contract revenues | 165,985 | 159,767 | 309,090 | 296,610 | |||||||||
Costs of contract revenues | 151,008 | 140,305 | 285,031 | 262,452 | |||||||||
Gross profit | 14,977 | 19,462 | 24,059 | 34,158 | |||||||||
Selling, general and administrative expenses | 15,114 | 14,710 | 30,087 | 27,751 | |||||||||
Amortization of intangible assets | 658 | 847 | 1,318 | 1,694 | |||||||||
Gain from sale of assets, net | (372 | ) | (686 | ) | (746 | ) | (1,499 | ) | |||||
Other gain from continuing operations | — | — | — | (5,448 | ) | ||||||||
Operating (loss) income | (423 | ) | 4,591 | (6,600 | ) | 11,660 | |||||||
Other (expense) income: | |||||||||||||
Other income | 534 | 476 | 557 | 474 | |||||||||
Interest income | 94 | 47 | 242 | 47 | |||||||||
Interest expense | (1,978 | ) | (1,205 | ) | (3,303 | ) | (2,682 | ) | |||||
Other expense, net | (1,350 | ) | (682 | ) | (2,504 | ) | (2,161 | ) | |||||
(Loss) income before income taxes | (1,773 | ) | 3,909 | (9,104 | ) | 9,499 | |||||||
Income tax expense | (140 | ) | 1,660 | 453 | 3,149 | ||||||||
Net (loss) income | $ | (1,633 | ) | $ | 2,249 | $ | (9,557 | ) | $ | 6,350 | |||
Basic (loss) income per share | $ | (0.06 | ) | $ | 0.08 | $ | (0.33 | ) | $ | 0.22 | |||
Diluted (loss) income per share | $ | (0.06 | ) | $ | 0.08 | $ | (0.33 | ) | $ | 0.22 | |||
Shares used to compute (loss) income per share | |||||||||||||
Basic | 29,097,094 | 28,309,004 | 29,086,811 | 28,243,400 | |||||||||
Diluted | 29,097,094 | 28,544,010 | 29,086,811 | 28,474,432 | |||||||||
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Orion Group Holdings, Inc. and Subsidiaries
Selected Results of Operations
(In Thousands, Except Share and Per Share Information)
(Unaudited)
Three months ended June 30, | Six months ended June 30, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Marine | |||||||||||||
Contract revenues | $ | 89,023 | $ | 80,698 | $ | 150,510 | $ | 143,489 | |||||
Operating income (loss) | 9 | 3,642 | (6,447 | ) | 9,907 | ||||||||
Concrete | |||||||||||||
Contract revenues | $ | 76,962 | 79,069 | $ | 158,580 | $ | 153,121 | ||||||
Operating (loss) income | (432 | ) | 949 | (153 | ) | 1,753 | |||||||
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Orion Group Holdings, Inc. and Subsidiaries
Reconciliation of Adjusted Net Income (Loss)
(In thousands except per share information)
(Unaudited)
Three months ended June 30, | Six months ended June 30, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Net (loss) income | $ | (1,633 | ) | $ | 2,249 | $ | (9,557 | ) | $ | 6,350 | |||
One-time charges and the tax effects: | |||||||||||||
ISG review process | 1,257 | — | 2,804 | — | |||||||||
Severance | 440 | — | 440 | — | |||||||||
Unamortized debt issuance costs on debt extinguishment | 399 | — | 399 | — | |||||||||
Legal settlement | — | — | — | (5,448 | ) | ||||||||
Tax rate of 23% applied to one-time charges (1) | (482 | ) | — | (838 | ) | 1,253 | |||||||
Total one-time charges and the tax effects | 1,614 | — | 2,805 | (4,195 | ) | ||||||||
Federal and state tax valuation allowances | 299 | — | 1,046 | — | |||||||||
Adjusted net income (loss) | $ | 280 | $ | 2,249 | $ | (5,706 | ) | $ | 2,155 | ||||
Adjusted EPS | $ | 0.01 | $ | 0.08 | $ | (0.20 | ) | $ | 0.08 | ||||
(1) Items are taxed discretely using the Company's blended tax rate.
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Orion Group Holdings, Inc. and Subsidiaries
Adjusted EBITDA and Adjusted EBITDA Margin Reconciliations
(In Thousands, Except Margin Data)
(Unaudited)
Three months ended June 30, | Six months ended June 30, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Net (loss) income | $ | (1,633 | ) | $ | 2,249 | $ | (9,557 | ) | $ | 6,350 | |||
Income tax expense | (140 | ) | 1,660 | 453 | 3,149 | ||||||||
Interest expense, net | 1,884 | 1,158 | 3,061 | 2,635 | |||||||||
Depreciation and amortization | 7,222 | 7,431 | 14,262 | 14,211 | |||||||||
EBITDA (1) | 7,333 | 12,498 | 8,219 | 26,345 | |||||||||
ISG review process | 1,257 | — | 2,804 | — | |||||||||
Severance | 440 | — | 440 | — | |||||||||
Legal settlement | — | — | — | (5,448 | ) | ||||||||
Adjusted EBITDA(2) | $ | 9,030 | $ | 12,498 | $ | 11,463 | $ | 20,897 | |||||
Operating (loss) income margin (3) | 0.1 | % | 3.2 | % | (2.0 | )% | 4.1 | % | |||||
Impact of depreciation and amortization | 4.3 | % | 4.6 | % | 4.6 | % | 4.8 | % | |||||
Impact of ISG review process | 0.7 | % | — | % | 1.0 | % | — | % | |||||
Impact of severance | 0.3 | % | — | % | 0.1 | % | — | % | |||||
Impact of legal settlement | — | % | — | % | — | % | (1.9 | )% | |||||
Adjusted EBITDA margin(2) | 5.4 | % | 7.8 | % | 3.7 | % | 7.0 | % | |||||
(1) EBITDA is a non-GAAP measure that represents earnings before interest, taxes, depreciation and amortization.
(2) Adjusted EBITDA is a non-GAAP measure that represents EBITDA adjusted for ISG review process, severance and legal settlement. Adjusted EBITDA margin is a non-GAAP measure calculated by dividing Adjusted EBITDA by contract revenues.
(3) Operating income margin is calculated by dividing operating income plus other income (expense), net by contract revenues.
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Orion Group Holdings, Inc. and Subsidiaries
Adjusted EBITDA and Adjusted EBITDA Margin Reconciliations by Segment
(In Thousands, Except Margin Data)
(Unaudited)
Marine | Concrete | ||||||||||||
Three months ended June 30, | Three months ended June 30, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Operating (loss) income | 9 | 3,642 | (432 | ) | 949 | ||||||||
Other income (expense), net | 3,582 | 3,251 | (3,048 | ) | (2,775 | ) | |||||||
Depreciation and amortization | 5,069 | 5,295 | 2,153 | 2,136 | |||||||||
EBITDA (1) | 8,660 | 12,188 | (1,327 | ) | 310 | ||||||||
ISG review process | 319 | — | 938 | — | |||||||||
Severance | 440 | — | — | — | |||||||||
Adjusted EBITDA(2) | $ | 9,419 | $ | 12,188 | $ | (389 | ) | $ | 310 | ||||
Operating (loss) income margin (3) | 4.0 | % | 8.5 | % | (4.5 | )% | (2.3 | )% | |||||
Impact of depreciation and amortization | 5.7 | % | 6.6 | % | 2.8 | % | 2.7 | % | |||||
Impact of ISG review process | 0.4 | % | — | % | 1.2 | % | — | % | |||||
Impact of severance | 0.5 | % | — | % | — | % | — | % | |||||
Adjusted EBITDA margin (2) | 10.6 | % | 15.1 | % | (0.5 | )% | 0.4 | % | |||||
Marine | Concrete | ||||||||||||
Six months ended June 30, | Six months ended June 30, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Operating (loss) income | (6,447 | ) | 9,907 | (153 | ) | 1,753 | |||||||
Other income (expense), net | 6,466 | 5,580 | (5,909 | ) | (5,106 | ) | |||||||
Depreciation and amortization | 10,015 | 10,026 | 4,247 | 4,185 | |||||||||
EBITDA (1) | 10,034 | 25,513 | (1,815 | ) | 832 | ||||||||
ISG review process | 1,140 | — | 1,664 | — | |||||||||
Severance | 440 | — | — | — | |||||||||
Legal settlement | — | (5,448 | ) | — | — | ||||||||
Adjusted EBITDA(2) | $ | 11,614 | $ | 20,065 | $ | (151 | ) | $ | 832 | ||||
Operating (loss) income margin (3) | — | % | 10.8 | % | (3.8 | )% | (2.2 | )% | |||||
Impact of depreciation and amortization | 6.7 | % | 7.0 | % | 2.7 | % | 2.7 | % | |||||
Impact of ISG review process | 0.7 | % | — | % | 1.0 | % | — | % | |||||
Impact of severance | 0.3 | % | — | % | — | % | — | % | |||||
Impact of legal settlement | — | % | (3.8 | )% | — | % | — | % | |||||
Adjusted EBITDA margin (2) | 7.7 | % | 14.0 | % | (0.1 | )% | 0.5 | % | |||||
(1) EBITDA is a non-GAAP measure that represents earnings before interest, taxes, depreciation and amortization.
(2) Adjusted EBITDA is a non-GAAP measure that represents EBITDA adjusted for ISG review process, severance and legal settlement. Adjusted EBITDA margin is a non-GAAP measure calculated by dividing Adjusted EBITDA by contract revenues.
(3) Operating income margin is calculated by dividing operating income plus other income (expense), net by contract revenues.
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Orion Group Holdings, Inc. and Subsidiaries
Consolidated Statements of Cash Flows
(In Thousands)
(Unaudited)
Six months ended June 30, | |||||||
2019 | 2018 | ||||||
Cash flows from operating activities | |||||||
Net (loss) income | $ | (9,557 | ) | $ | 6,350 | ||
Adjustments to reconcile net (loss) income to net cash (used in) provided by | |||||||
Operating activities: | |||||||
Depreciation and amortization | 13,108 | 14,211 | |||||
Amortization of ROU operating leases | 2,927 | — | |||||
Amortization of ROU finance leases | 1,154 | — | |||||
Unamortized debt issuance costs upon debt modification | 399 | — | |||||
Amortization of deferred debt issuance costs | 186 | 646 | |||||
Deferred income taxes | 43 | 1,841 | |||||
Stock-based compensation | 1,728 | 1,151 | |||||
Gain on sale of property and equipment | (746 | ) | (1,499 | ) | |||
Other gain from continuing operations | — | (5,448 | ) | ||||
Change in operating assets and liabilities, net of effects of acquisitions: | |||||||
Accounts receivable | (28,257 | ) | 8,983 | ||||
Notes receivable | 264 | — | |||||
Income tax receivable | (398 | ) | 91 | ||||
Inventory | 252 | 588 | |||||
Prepaid expenses and other | (138 | ) | 1,482 | ||||
Costs and estimated earnings in excess of billings on uncompleted contracts | (14,424 | ) | (7,282 | ) | |||
Accounts payable | 6,261 | (6,952 | ) | ||||
Accrued liabilities | (1,601 | ) | (962 | ) | |||
Operating lease liabilities | (2,896 | ) | |||||
Income tax payable | 409 | 449 | |||||
Billings in excess of costs and estimated earnings on uncompleted contracts | 30,204 | (8,854 | ) | ||||
Other | — | (286 | ) | ||||
Net cash (used in) provided by operating activities | (1,082 | ) | 4,509 | ||||
Cash flows from investing activities: | |||||||
Proceeds from sale of property and equipment | 847 | 1,070 | |||||
Purchase of property and equipment | (8,118 | ) | (11,911 | ) | |||
Contributions to CSV life insurance | (444 | ) | (266 | ) | |||
Proceeds from return of investment | — | 94 | |||||
Insurance claim proceeds related to property and equipment | 2,574 | 1,150 | |||||
Net cash used in investing activities | (5,141 | ) | (9,863 | ) | |||
Cash flows from financing activities: | |||||||
Borrowings from Credit Facility | 32,000 | 13,000 | |||||
Payments made on borrowings from Credit Facility | (29,500 | ) | (11,750 | ) | |||
Loan costs from Credit Facility | (825 | ) | — | ||||
Payments of finance lease liabilities | (1,412 | ) | — | ||||
Exercise of stock options | 35 | 1,299 | |||||
Net cash provided by financing activities | 298 | 2,549 | |||||
Net change in cash and cash equivalents | (5,925 | ) | (2,805 | ) | |||
Cash and cash equivalents at beginning of period | 8,684 | 9,086 | |||||
Cash and cash equivalents at end of period | $ | 2,759 | $ | 6,281 | |||
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Orion Group Holdings, Inc. and Subsidiaries
Consolidated Statements of Cash Flows Summary
(In Thousands)
(Unaudited)
Three months ended June 30, | Six months ended June 30, | ||||||||||||
2019 | 2018 | 2019 | 2018 | ||||||||||
Cash flows provided by (used in) operating activities | $ | 846 | $ | (6,108 | ) | $ | (1,082 | ) | $ | 4,509 | |||
Cash flows used in investing activities | $ | (1,378 | ) | $ | (6,920 | ) | $ | (5,141 | ) | $ | (9,863 | ) | |
Cash flows provided by financing activities | $ | 666 | $ | 10,108 | $ | 298 | $ | 2,549 | |||||
Capital expenditures (included in investing activities above) | $ | (4,256 | ) | $ | (7,565 | ) | $ | (8,118 | ) | $ | (11,911 | ) | |
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Orion Group Holdings, Inc. and Subsidiaries
Consolidated Balance Sheets
(In Thousands, Except Share and Per Share Information)
June 30, 2019 | December 31, 2018 | ||||||
(Unaudited) | |||||||
ASSETS | |||||||
Current assets: | |||||||
Cash and cash equivalents | $ | 2,759 | $ | 8,684 | |||
Accounts receivable: | |||||||
Trade, net of allowance of $4,280 and $4,280, respectively | 99,292 | 77,641 | |||||
Retainage | 36,889 | 30,734 | |||||
Other current | 2,134 | 4,257 | |||||
Income taxes receivable | 865 | 467 | |||||
Inventory | 907 | 1,056 | |||||
Costs and estimated earnings in excess of billings on uncompleted contracts | 23,641 | 9,217 | |||||
Prepaid expenses and other | 4,947 | 5,000 | |||||
Total current assets | 171,434 | 137,056 | |||||
Property and equipment, net of depreciation | 135,045 | 148,003 | |||||
Operating lease right-of-use assets, net of amortization | 21,510 | — | |||||
Financing lease right-of-use assets, net of amortization | 8,238 | — | |||||
Inventory, non-current | 7,495 | 7,598 | |||||
Intangible assets, net of amortization | 13,467 | 14,787 | |||||
Other non-current | 5,600 | 5,426 | |||||
Total assets | $ | 362,789 | $ | 312,870 | |||
LIABILITIES AND STOCKHOLDERS’ EQUITY | |||||||
Current liabilities: | |||||||
Current debt, net of issuance costs | $ | 2,939 | $ | 2,946 | |||
Accounts payable: | |||||||
Trade | 48,175 | 42,023 | |||||
Retainage | 845 | 736 | |||||
Accrued liabilities | 13,902 | 18,840 | |||||
Income taxes payable | 409 | — | |||||
Billings in excess of costs and estimated earnings on uncompleted contracts | 51,964 | 21,761 | |||||
Current portion of operating lease liabilities | 5,677 | — | |||||
Current portion of financing lease liabilities | 2,935 | — | |||||
Total current liabilities | 126,846 | 86,306 | |||||
Long-term debt, net of debt issuance costs | 78,386 | 76,119 | |||||
Operating lease liabilities | 16,485 | — | |||||
Financing lease liabilities | 4,291 | — | |||||
Other long-term liabilities | 2,846 | 8,759 | |||||
Deferred income taxes | 92 | 49 | |||||
Interest rate swap liability | 1,094 | 52 | |||||
Total liabilities | 230,040 | 171,285 | |||||
Stockholders’ equity: | |||||||
Preferred stock -- $0.01 par value, 10,000,000 authorized, none issued | — | — | |||||
Common stock -- $0.01 par value, 50,000,000 authorized, 30,215,084 and 29,611,989 issued; 29,503,853 and 28,900,758 outstanding at December 31, 2018 and December 31, 2017, respectively | 302 | 296 | |||||
Treasury stock, 711,231 and 711,231 shares, at cost December 31, 2018 and December 31, 2017, respectively | (6,540 | ) | (6,540 | ) | |||
Other comprehensive loss | (1,094 | ) | (52 | ) | |||
Additional paid-in capital | 181,499 | 179,742 | |||||
Retained loss | (41,418 | ) | (31,861 | ) | |||
Total stockholders’ equity | 132,749 | 141,585 | |||||
Total liabilities and stockholders’ equity | $ | 362,789 | $ | 312,870 | |||
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