The Goldfield Corporation (NYSE American: GV), a leading provider
of electrical construction services for the utility industry and
industrial customers, today announced its financial results for the
three months ended March 31, 2019. Through its subsidiaries, Power
Corporation of America, C and C Power Line, Inc., Southeast Power
Corporation and Precision Foundations, Inc., Goldfield provides
electrical construction services primarily in the Southeast,
mid-Atlantic, and Texas-Southwest regions of the United States. To
a lesser extent, Goldfield is also engaged in real estate
operations focused on the development of residential properties on
the east coast of Central Florida.
President and Chief Executive Officer John H. Sottile said,
“First quarter electrical construction revenue grew by over 21
percent year-over-year, and our real estate development operations
delivered a strong top and bottom-line performance. Although total
revenue for the quarter increased by a robust 37.9 percent against
a solid performance in the year ago period, our profit margins were
held back primarily due to electrical construction projects in our
Texas-Southwest region affected by weather and project productivity
issues.”
Sottile continued, “As we look ahead to the rest of 2019, we see
the potential for significant growth in both our customer base and
services across our Texas-Southwest and mid-Atlantic regions, as
well as opportunities in our Southeast region through expanding our
geographic customer base and strengthening of service offerings
with existing customers. Additionally, we are taking steps to
improve margin performance across our entire base of operations.
The repositioning of our foundation operations, executed over the
past year, should begin to yield benefits going forward as we are
starting to secure work that meets our profit margin guidelines. In
our Texas-Southwest operations, we are broadening our service
offering and diversifying our customer base to drive improved
results from this important region.”
For the quarter ended March 31, 2019, compared to the same
period in 2018:
- Consolidated revenue increased 37.9% to $47.5 million from
$34.4 million, attributable to increased electrical construction
operations.
- Electrical construction revenue increased 21.3% to $41.4
million from $34.1 million primarily due to increases in both
master service agreements (“MSA”) and non-MSA customer project
activity, as well as service line expansion.
- Real estate development revenue increased to $6.1 million from
$307,000 mainly due to the timing of the completion of units
available for sale.
- Gross margin on electrical construction decreased to 14.7% from
21.5%, attributable to project losses in our Texas-Southwest
operations resulting from weather and project productivity issues,
as well as start-up costs related to the substation service line
expansion in the Texas-Southwest region.
- Gross margin on real estate development held relatively steady
at 31.2% compared to 30.3%.
- Operating income decreased to $2.9 million from $3.5 million,
mainly due to lower margins on electrical construction projects, an
increase in depreciation expense and higher selling, general and
administrative expenses, partially offset by higher real estate
development gross margin.
- Net income decreased to $1.8 million, or $0.07 per share,
compared to $2.4 million, or $0.09 per share.
- EBITDA (a non-GAAP measure)(1) was $5.5 million compared to
$5.4 million. This increase was primarily due to the increase in
real estate development segment margin, partially offset by the
decrease in electrical construction margins and increases in
depreciation and selling, general and administrative expenses.
Backlog
At March 31, 2019, total backlog increased $15.2 million (7.8%)
to $208.2 million, from $193.1 million at the same date last year.
Total backlog includes total revenue estimated over the remaining
life of the MSAs plus estimated revenue from fixed-price
contracts.
The Company’s 12-month electrical construction backlog decreased
$12.1 million (10.9%) to $99.0 million from $111.1 million at the
same date last year, mainly due to adjustments to existing MSA
backlog estimates, partially offset by new MSA customer backlog
estimates. The impact of future projects awarded under MSAs cannot
be determined with certainty and revenue from such contracts may
vary substantially from current estimates.
Backlog is estimated at a particular point in time and is not
determinative of total revenue in any particular period. It does
not reflect future revenue from a significant number of short-term
projects undertaken and completed between the estimated dates.
Stock Buy Back Program
The Company has extended its Stock Repurchase plan from
September 30, 2019 until September 30, 2020 and has increased the
number of shares available for purchase under the plan. Under the
revised plan 2,726,120 shares were available for repurchase as of
March 31, 2019. The Company repurchased 861,111 shares in December
2018. For the three months ended March 31, 2019, Goldfield
repurchased 67,709 shares.
Conference Call
The Company’s President and Chief Executive Officer John H.
Sottile and Chief Financial Officer Stephen R. Wherry will host a
conference call and webcast to discuss results at 10 a.m. Eastern
time on, Thursday, May 9, 2019. To participate in the conference
call via telephone, please dial (866) 373-3407 (domestic) or (412)
902-1037 (international) at least five minutes prior to the start
of the event. Goldfield will also webcast the conference call live
via the internet. Interested parties may access the webcast at
https://78449.themediaframe.com/dataconf/productusers/gv/mediaframe/29913/indexl.html
or through the Investor Relations section of the Company’s website
at http://www.goldfieldcorp.com. Please access the website at least
15 minutes prior to the start of the call to register and download
and install any necessary audio software. The webcast will be
archived at this link or through the Investor Relations section of
the Company’s website for six months.
About Goldfield
Goldfield is a leading provider of electrical construction
services engaged in the construction of electrical infrastructure
for the utility industry and industrial customers, primarily in the
Southeast, mid-Atlantic and Texas-Southwest regions of the United
States. For additional information on our first-quarter 2019
results, please refer to our report on Form 10-Q being filed with
the Securities and Exchange Commission and visit the Company’s
website at http://www.goldfieldcorp.com.
____________________________
(1) Represents Non-GAAP Financial Measure - The
non-GAAP financial measure used in this earnings release is more
fully described in the accompanying supplemental data and
reconciliation of the non-GAAP financial measure to the reported
GAAP measure. The non-GAAP measure in this press release and on The
Goldfield Corporation’s website is provided to enable investors and
analysts to evaluate the Company’s performance excluding the
effects of certain items that impact the comparability of operating
results between reporting periods and compare the Company’s
operating results with those of its competitors. This measure
should be used to supplement, and not in lieu of, results prepared
in conformity with GAAP. Because not all companies use identical
calculations, this presentation of EBITDA may not be comparable to
other similarly-titled measures of other companies.
Forward-Looking Statements
This press release includes forward-looking statements within
the meaning of the “safe harbor” provision of the Private
Securities Litigation Reform Act of 1995 throughout this document.
You can identify these statements by forward-looking words such as
“may,” “will,” “expect,” “anticipate,” “believe,” “estimate,”
“plan,” and “continue” or similar words. We have based these
statements on our current expectations about future events.
Although we believe that our expectations reflected in or suggested
by our forward-looking statements are reasonable, we cannot assure
you that these expectations will be achieved. Our actual results
may differ materially from what we currently expect. Factors that
may affect the results of our operations include, among others: the
level of construction activities by public utilities; the
concentration of revenue from a limited number of utility
customers; the loss of one or more significant customers; the
timing and duration of construction projects for which we are
engaged; our ability to estimate accurately with respect to fixed
price construction contracts; and heightened competition in the
electrical construction field, including intensification of price
competition. Other factors that may affect the results of our
operations include, among others: adverse weather; natural
disasters; effects of climate changes; changes in generally
accepted accounting principles; ability to obtain necessary permits
from regulatory agencies; our ability to maintain or increase
historical revenue and profit margins; general economic conditions,
both nationally and in our region; adverse legislation or
regulations; availability of skilled construction labor and
materials and material increases in labor and material costs; and
our ability to obtain additional and/or renew financing. Other
important factors which could cause our actual results to differ
materially from the forward-looking statements in this press
release are detailed in the Company’s Risk Factors and Management’s
Discussion and Analysis of Financial Condition and Results of
Operation sections of our Annual Report on Form 10-K and
Goldfield’s other filings with the Securities and Exchange
Commission, which are available on Goldfield’s website:
http://www.goldfieldcorp.com. We may not update these
forward-looking statements, even in the event that our situation
changes in the future, except as required by law.
For further information, please contact:The Goldfield
CorporationRobert Winters or Josh LittmanPhone: (312)
445-2870Email: gv@alpha-ir.com
- Tables Follow -
|
The Goldfield Corporation and
SubsidiariesConsolidated Statements of
Income(Unaudited) |
|
|
|
|
|
|
Three Months Ended |
|
|
|
March 31, |
|
|
|
2019 |
|
|
2018 |
|
Revenue |
|
|
|
|
|
|
|
|
Electrical construction |
|
$ |
41,387,318 |
|
|
$ |
34,131,919 |
|
Real estate development |
|
|
6,092,938 |
|
|
|
306,777 |
|
Total revenue |
|
|
47,480,256 |
|
|
|
34,438,696 |
|
Costs and expenses |
|
|
|
|
|
|
|
|
Electrical construction |
|
|
35,292,012 |
|
|
|
26,782,860 |
|
Real estate development |
|
|
4,189,654 |
|
|
|
213,757 |
|
Selling, general and administrative |
|
|
2,528,321 |
|
|
|
2,116,414 |
|
Depreciation and amortization |
|
|
2,581,079 |
|
|
|
1,887,508 |
|
(Gain) loss on sale of property and equipment |
|
|
(25,851 |
) |
|
|
(13,391 |
) |
Total costs and expenses |
|
|
44,565,215 |
|
|
|
30,987,148 |
|
Total operating income |
|
|
2,915,041 |
|
|
|
3,451,548 |
|
Other income (expense), net |
|
|
|
|
|
|
|
|
Interest income |
|
|
11,552 |
|
|
|
6,789 |
|
Interest expense, net of amount capitalized |
|
|
(351,992 |
) |
|
|
(189,617 |
) |
Other income, net |
|
|
32,284 |
|
|
|
15,094 |
|
Total other expense, net |
|
|
(308,156 |
) |
|
|
(167,734 |
) |
Income before income taxes |
|
|
2,606,885 |
|
|
|
3,283,814 |
|
Income tax provision |
|
|
827,264 |
|
|
|
878,139 |
|
Net income |
|
$ |
1,779,621 |
|
|
$ |
2,405,675 |
|
Net income per share of common
stock — basic and diluted |
|
$ |
0.07 |
|
|
$ |
0.09 |
|
Weighted average shares
outstanding — basic and diluted |
|
|
24,526,165 |
|
|
|
25,451,354 |
|
|
|
|
|
|
|
|
|
|
|
The Goldfield Corporation and
SubsidiariesCondensed Consolidated Balance
Sheets(Unaudited) |
|
|
|
|
|
|
|
|
|
March 31, |
|
|
December 31, |
|
|
|
2019 |
|
|
2018 |
|
ASSETS |
|
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
|
|
|
Cash and cash equivalents |
|
$ |
15,037,639 |
|
|
$ |
11,376,373 |
|
Accounts receivable and accrued billings, net |
|
|
27,155,515 |
|
|
|
22,236,071 |
|
Costs and estimated earnings in excess of billings on uncompleted
contracts |
|
|
14,216,479 |
|
|
|
12,030,000 |
|
Income taxes receivable |
|
|
1,069,445 |
|
|
|
1,220,527 |
|
Residential properties under construction |
|
|
203,075 |
|
|
|
8,244,995 |
|
Real estate inventory |
|
|
5,137,139 |
|
|
|
- |
|
Prepaid expenses |
|
|
1,563,796 |
|
|
|
634,069 |
|
Other current assets |
|
|
867,915 |
|
|
|
1,835,743 |
|
Total current assets |
|
|
65,251,003 |
|
|
|
57,577,778 |
|
Property, buildings and
equipment, at cost, net |
|
|
56,588,575 |
|
|
|
48,927,055 |
|
Deferred charges and other
assets |
|
|
9,125,123 |
|
|
|
6,043,642 |
|
Total assets |
|
$ |
130,964,701 |
|
|
$ |
112,548,475 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
|
|
|
Accounts payable and accrued liabilities |
|
$ |
18,116,933 |
|
|
$ |
15,999,157 |
|
Current portion of notes payable, net |
|
|
12,301,391 |
|
|
|
7,161,890 |
|
Accrued remediation costs |
|
|
65,136 |
|
|
|
60,101 |
|
Other current liabilities |
|
|
1,207,248 |
|
|
|
1,278,857 |
|
Total current liabilities |
|
|
31,690,708 |
|
|
|
24,500,005 |
|
Deferred income taxes |
|
|
6,737,224 |
|
|
|
6,061,042 |
|
Accrued remediation costs, less
current portion |
|
|
421,455 |
|
|
|
436,982 |
|
Notes payable, less current
portion, net |
|
|
30,246,381 |
|
|
|
21,731,024 |
|
Other accrued liabilities |
|
|
645,165 |
|
|
|
213,990 |
|
Total liabilities |
|
|
69,740,933 |
|
|
|
52,943,043 |
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
Stockholders’ equity |
|
|
|
|
|
|
|
|
Common stock |
|
|
2,781,377 |
|
|
|
2,781,377 |
|
Capital surplus |
|
|
18,481,683 |
|
|
|
18,481,683 |
|
Retained earnings |
|
|
43,400,812 |
|
|
|
41,621,191 |
|
Common stock in treasury, at cost |
|
|
(3,440,104 |
) |
|
|
(3,278,819 |
) |
Total stockholders’ equity |
|
|
61,223,768 |
|
|
|
59,605,432 |
|
Total liabilities and
stockholders’ equity |
|
$ |
130,964,701 |
|
|
$ |
112,548,475 |
|
|
|
|
|
|
|
|
|
|
The Goldfield Corporation and
SubsidiariesReconciliation of Non-GAAP Financial
Measures(Unaudited)
EBITDA, a non-GAAP performance measure used by management, is
defined as net income (loss) plus: interest expense, provision
(benefit) for income taxes and depreciation and amortization, as
shown in the table below. EBITDA, a non-GAAP financial measure,
does not purport to be an alternative to net income (loss) as a
measure of operating performance. Because not all companies use
identical calculations, this presentation of EBITDA may not be
comparable to other similarly-titled measures of other companies.
We use, and we believe investors benefit from the presentation of,
EBITDA in evaluating our operating performance because it provides
us and our investors with an additional tool to compare our
operating performance on a consistent basis by removing the impact
of certain items that management believes do not directly reflect
our core operations. We believe that EBITDA is useful to investors
and other external users of our financial statements in evaluating
our operating performance because EBITDA is widely used by
investors to measure a company’s operating performance without
regard to items such as interest expense, taxes, and depreciation
and amortization, which can vary substantially from company to
company depending upon accounting methods and book value of assets,
capital structure and the method by which assets were acquired.
|
|
Three Months Ended |
|
|
|
March 31, |
|
EBITDA |
|
2019 |
|
|
2018 |
|
Net income (GAAP as reported) |
|
$ |
1,779,621 |
|
|
$ |
2,405,675 |
|
Interest expense, net of amount capitalized |
|
|
351,992 |
|
|
|
189,617 |
|
Provision for income taxes, net (1) |
|
|
827,264 |
|
|
|
878,139 |
|
Depreciation and amortization (2) |
|
|
2,581,079 |
|
|
|
1,887,508 |
|
EBITDA |
|
$ |
5,539,956 |
|
|
$ |
5,360,939 |
|
|
|
|
|
|
|
|
|
|
(1) Provision for income tax, net is equal to the total
amount of tax provision, which includes the tax benefit for
discontinued operations.
(2) Depreciation and amortization include depreciation on
property, plant and equipment and amortization of finite-lived
intangible assets.
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