USA: Orion Marine Group Inc. Reports Second Quarter 2011 Results
Orion Marine Group, Inc., a leading heavy civil marine contractor, today reported a net loss for the three months ended June 30, 2011, of $3.2 million ($0.12 diluted loss per share). These results compare to net income of $7.0 million ($0.26 diluted earnings per share) for the same period a year ago.
“Although we had an improved success rate on bids during the quarter, we were very disappointed with the lack of bid lettings for maintenance dredging projects,” said Mike Pearson, Orion Marine Group’s President and Chief Executive Officer. “We came into 2011 fully expecting continued pricing pressure in marine construction as a result of the economic uncertainty. However, we did not foresee the gross inaction of Congress, which has made it impossible for agencies like the Army Corps of Engineers to effectively carry out their mandate of maintaining our nation’s waterways. This inaction has resulted in a gap in Army Corps of Engineers lettings, which has extended longer than we anticipated and significantly pressured margins and revenue during the quarter. We expected to start seeing federal bid opportunities for projects involving dredging services begin to be let in June. However, while Congress approved a 2011 Army Corps of Engineers budget in April, continued debt ceiling deliberations in Congress further exacerbated the gap in Corps lettings. The unprecedented dysfunction of the US Government has affected funding of long-term infrastructure projects that are greatly needed. As a result we have seen a gap in Navy and Corps lettings, the delay in our receipt of the notice to proceed on a Navy job, and continued uncertainty about the future outlook of government spending. Additionally, we experienced a delay on a Corps job as a result of the Mississippi River flooding. In response to these developments, we have taken steps to protect the intrinsic value of Orion Marine Group by controlling costs so we can manage through this downturn and prepare for future opportunities. There is no doubt we are disappointed in the macro-economic events that have unfolded from Congressional gridlock in Washington, but we are working aggressively to right-size the Company to match the current market activity while focusing on protecting shareholder value.”
Source: Orion Marine, August 4, 2011