Great Lakes Dredge & Dock Reports First Quarter Results

Great Lakes Dredge & Dock Corporation today reported financial results for the quarter ended March 31, 2016.

For the three months ended March 31, 2016, Great Lakes reported revenue of $163.1 million, net loss of $4.0 million and Adjusted EBITDA of $13.0 million.

“The Company’s first quarter 2016 results were driven by the domestic dredging business, including strong performances on several coastal protection and capital projects. Compared to the first quarter of 2015, the environmental and infrastructure (E&I) segment’s performance significantly improved, though still at a loss due to the seasonality of the business,” said Chief Executive Officer Jonathan Berger.

“The improvement was driven by the resolution of certain claims and change orders and project losses in 2015 that did not reoccur, somewhat offset by a new project loss.

“Within our E&I segment, we will continue to take meaningful measures that will be transformative for the business, including making cost reductions to align the organization with its expected revenue. We firmly believe that 2016 will be a year of marked improvement for this segment.”

First Quarter 2016 Highlights

Dredging

• Revenue in the first quarter 2016 decreased over the prior year period primarily due to lower foreign capital revenue, partially offset by higher domestic capital, coastal protection and rivers and lakes revenues;
• Gross profit increased 27.9% during the first quarter compared to the same quarter 2015 primarily due to strong performance on several domestic coastal protection and capital projects;
• Operating income increased 34.4% in the first quarter 2016 compared to the prior year quarter due to higher gross profit margin, partially offset by higher G&A expense related to labor costs and legal fees;
• Dredging backlog was $633.2 million at the end of the first quarter, which is a decrease of $44.5 million compared to backlog at December 31, 2015.

Total Company

• Net loss was $4.0 million compared to net loss of $8.4 million in the first quarter of 2015. The loss in the current period includes income tax benefit of $2.7 million and interest expense of $5.7 million. The loss in the first quarter of 2015 includes income tax benefit of $6.0 million, interest expense of $5.6 million and $1.1 million equity in loss of joint ventures related to the joint ventures that were dissolved in 2015;
• Adjusted EBITDA was $13.0 million, an $8.6 million increase from $4.4 million in the first quarter of 2015;
• Total capital expenditures for the quarter were $17.5 million. Capital expenditures during the first quarter include $12.0 million to support growth, including $8.4 million for the ATB, and the majority of the remainder for improvements to the dredging fleet. In the prior year quarter, total capital expenditures were $33.3 million and included $15.6 million to purchase a vessel that was formerly leased, $12.0 million to support growth, which included $6.8 million for the ATB, and the remainder for improvements to the dredging fleet and other equipment;
• Cash at March 31, 2016 was $15.9 million, with total debt of $367.0 million ($7.5 million short-term debt and $359.5 million long-term debt);
• Total company backlog at March 31, 2016 was $710.4 million.