Orion Group Holdings, Inc. (NYSE: ORN) (the “Company”), a
leading specialty construction company, today reported net income
of $11.8 million ($0.39 diluted earnings per share) for the third
quarter ended September 30, 2020. Third quarter highlights are
discussed below.
Third Quarter 2020 Highlights
- Contract revenues were $189.4 million, down 5.0% from $199.5
million for the third quarter of 2019.
- Operating income was $13.1 million for the third quarter of
2020 compared to operating income of $6.1 million for the third
quarter of 2019.
- Net income was $11.8 million ($0.39 diluted earnings per share)
for the third quarter of 2020 compared to net income of $4.0
million ($0.14 diluted earnings per share) for the third quarter of
2019.
- The third quarter 2020 net income included $2.5 million ($0.08
earnings per diluted share) of non-recurring items and $2.2 million
($0.08 earnings per diluted share) of tax benefit associated with
the movement of certain valuation allowances. Third quarter 2020
adjusted net income was $7.1 million ($0.23 diluted earnings per
share). (Please see page 9 of this release for a reconciliation of
adjusted net income).
- EBITDA, adjusted to exclude the impact of the aforementioned
non-recurring costs, was $17.0 million in the third quarter of
2020, which compares to adjusted EBITDA of $14.9 million for the
third quarter of 2019. (Please see page 10 of this release for an
explanation of EBITDA, adjusted EBITDA and a reconciliation to the
nearest GAAP measure).
- Backlog at the end of the third quarter was $428.8 million on a
third quarter book-to-bill of 0.47x.
During the third quarter an explosion and fire occurred in the
Port of Corpus Christi Ship Channel while the Company’s dredge
Waymon Boyd was working near a pipeline, which resulted in the
deaths of five crewmen and injuries, some severe, to several other
crewmen. “Our primary concern remains the well-being of our crew
members and their families involved in this incident,” said Mark
Stauffer, Orion’s President and Chief Executive Officer. “Safety is
an integral part of our Guiding Beliefs at Orion and we remain
deeply committed to our Target Zero program to support our vision
of an incident free workplace. Our support, thoughts, and prayers
remain with the crew of the Waymon Boyd and their families.”
As a result of this incident, third quarter results include a
net $2.9 million gain on the disposal of assets related to
insurance recoveries as a result of the loss of the dredge Waymon
Boyd and associated vessels. The Company is currently evaluating
the best dredging asset alternatives to reinvest this capital. In
the meantime, the Company is confident that it has the equipment
and personnel to perform dredging on all existing contracts
involving dredging services. The cause of this incident remains
under investigation, led by the National Transportation Safety
Board, and the Company continues to fully cooperate with the NTSB
and other governmental agencies.
“Turning to our financial results, year over year consolidated
bottom line growth was driven by continued improved operating
performance in both segments. Our concrete segment saw
significantly improved operating performance despite revenues being
down year over year due to tropical weather in Texas impacting
production at the end of the current year quarter. Despite the
challenges faced during the quarter, our marine segment saw
sequential improvement in operating performance and EBITDA margin,”
continued Mr. Stauffer.
“We continue to see bidding activity in both our segments being
driven by end markets that are continuing to operate during the
COVID-19 pandemic. We continue to focus our efforts on targeting
the end markets and projects we expect to have the best
opportunities to be successful and profitable moving forward. A key
element of our growth strategy is the wide array of end markets we
serve, which enables us to pursue the most attractive bid
opportunities in the end markets that are performing the best at
any given point in time and this strategy serves us well in this
challenging and uncertain environment.”
Mr. Stauffer concluded, “We remain confident in our ability to
efficiently and profitably execute our projects in backlog, and in
our ability to maintain and grow our backlog level by targeting and
winning new bid opportunities. Our liquidity position remains
strong and provides us with more than sufficient financial
flexibility to continue to pursue new awards and execute existing
backlog. Our team is focused on continuing to perform well despite
the macroeconomic challenges. With our diverse end markets, broad
range of construction capabilities and assets, and our highly
experienced and professional personnel, we are confident in our
ability to deliver increasing levels of profitability and free cash
flow in the quarters and years to come, particularly in a
post-pandemic environment.”
Consolidated Results for Third Quarter 2020 Compared to Third
Quarter 2019
- Contract revenues were $189.4 million, down 5.0% as compared to
$199.5 million. The decrease was primarily driven by a decrease in
production volume in the concrete segment due to tropical weather
in Texas during the last few weeks of the current year
quarter.
- Gross profit was $22.5 million, as compared to $20.9 million.
Gross profit margin was 11.9%, as compared to 10.5%. The increase
in gross profit dollars and percentage was primarily driven by
project execution margin expansion in both segments and better
labor utilization in the marine segment.
- Selling, General, and Administrative expenses were $15.3
million, as compared to $14.6 million. As a percentage of total
contract revenues, SG&A expenses increased to 8.1% from 7.3%.
The increase in SG&A dollars and percentage were primarily
attributable to the full ratable accrual of the annual incentive
compensation plan during the current year period.
- Operating income was $13.1 million as compared to $6.1 million.
The operating income in the third quarter of 2020 reflects the
aforementioned factors that improved gross profit as well as the
$2.9 million net gain on disposal of assets related to insurance
recoveries.
- EBITDA was $20.0 million, representing a 10.5% EBITDA margin,
as compared to EBITDA of $13.2 million, or a 6.6% EBITDA margin.
When adjusted for non-recurring items, adjusted EBITDA for the
third quarter of 2020 was $17.0 million, representing a 9.0% EBITDA
margin. (Please see page 10 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 September 30, 2020 was
$428.8 million, which compares with backlog under contract at
September 30, 2019 of $620.5 million, a decrease of 30.9%. The
prior period backlog number reflects the booking of a large project
during the second quarter of 2019 with a contract value of $160
million that has progressed significantly towards completion. The
third quarter 2020 ending backlog was comprised of $241.7 million
for the marine segment, and $187.1 million for the concrete
segment. Currently, the Company has approximately $1.1 billion
worth of bids outstanding, including approximately $108 million on
which it is the apparent low bidder or has been awarded contracts
subsequent to the end of the third quarter of 2020, of which
approximately $49 million pertains to the marine segment and
approximately $59 million to the concrete segment.
“During the third quarter, we bid on approximately $734 million
of work and were successful on approximately $90 million of these
bids,” stated Robert Tabb, Orion Group Holding's Vice President and
Chief Financial Officer. “This resulted in a 0.47 times
book-to-bill ratio and a win rate of 12.2%. In the marine segment,
we bid on approximately $232 million during the third quarter 2020
and were successful on approximately $42 million, representing a
win rate of 18.3% and a book-to-bill ratio of 0.38 times. In the
concrete segment we bid on approximately $502 million of work and
were awarded approximately $47 million, representing a win rate of
9.4% and a book-to-bill ratio of 0.62 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 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.
Conference Call Details
Orion Group Holdings will host a conference call to discuss
results for the third quarter 2020 at 10:00 a.m. Eastern Time/9:00
a.m. Central Time on Thursday, October 29, 2020. 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 (201) 493-6739 and ask for the Orion Group
Holdings Conference Call.
About Orion Group Holdings
Orion Group Holdings, Inc., a leading specialty construction
company serving the infrastructure, industrial and building
sectors, provides services both on and off the water in the
continental United States, Alaska, Canada and the Caribbean Basin
through its marine segment and its concrete segment. The Company’s
marine segment provides construction and dredging services relating
to marine transportation facility construction, marine pipeline
construction, marine environmental structures, dredging of
waterways, channels and ports, environmental dredging, design, and
specialty services. Its 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.
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.
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, 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 February 28, 2020, 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.
Orion Group Holdings, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Operations
(In Thousands, Except Share
and Per Share Information)
(Unaudited)
Three months ended
Nine months ended
September 30,
September 30,
2020
2019
2020
2019
Contract revenues
189,433
199,507
539,766
508,597
Costs of contract revenues
166,932
178,614
476,763
463,645
Gross profit
22,501
20,893
63,003
44,952
Selling, general and administrative
expenses
15,270
14,590
47,651
44,677
Amortization of intangible assets
519
662
1,552
1,980
Gain on disposal of assets, net
(6,373)
(451)
(7,734)
(1,197)
Operating income (loss)
13,085
6,092
21,534
(508)
Other (expense) income:
Other income
115
17
251
574
Interest income
57
75
151
317
Interest expense
(1,151)
(1,678)
(3,722)
(4,981)
Other expense, net
(979)
(1,586)
(3,320)
(4,090)
Income (loss) before income taxes
12,106
4,506
18,214
(4,598)
Income tax expense (benefit)
303
467
1,660
920
Net income (loss)
$
11,803
$
4,039
$
16,554
$
(5,518)
Basic earnings (loss) per share
$
0.39
$
0.14
$
0.55
$
(0.19)
Diluted earnings (loss) per share
$
0.39
$
0.14
$
0.55
$
(0.19)
Shares used to compute income (loss) per
share:
Basic
30,372,310
29,544,288
30,020,258
29,240,979
Diluted
30,372,310
29,547,185
30,020,258
29,240,979
Orion Group Holdings, Inc. and
Subsidiaries
Selected Results of
Operations
(In Thousands, Except Share
and Per Share Information)
(Unaudited)
Three months ended September
30,
2020
2019
Amount
Percent
Amount
Percent
(dollar amounts in
thousands)
Contract revenues
Marine segment
Public sector
$
68,353
60.6
%
$
73,921
68.8
%
Private sector
44,528
39.4
%
33,483
31.2
%
Marine segment total
$
112,881
100.0
%
$
107,404
100.0
%
Concrete segment
Public sector
$
8,784
11.5
%
$
14,169
15.4
%
Private sector
67,768
88.5
%
77,934
84.6
%
Concrete segment total
$
76,552
100.0
%
$
92,103
100.0
%
Total
$
189,433
$
199,507
Operating income
Marine segment
$
8,992
8.0
%
$
4,863
4.5
%
Concrete segment
4,093
5.3
%
1,229
1.3
%
Total
$
13,085
$
6,092
Nine months ended September
30,
2020
2019
Amount
Percent
Amount
Percent
(dollar amounts in
thousands)
Contract revenues
Marine segment
Public sector
$
181,684
62.5
%
$
180,487
70.0
%
Private sector
108,865
37.5
%
77,427
30.0
%
Marine segment total
$
290,549
100.0
%
$
257,914
100.0
%
Concrete segment
Public sector
$
36,858
14.8
%
$
40,551
16.2
%
Private sector
212,359
85.2
%
210,132
83.8
%
Concrete segment total
$
249,217
100.0
%
$
250,683
100.0
%
Total
$
539,766
$
508,597
Operating income (loss)
Marine segment
$
12,443
4.3
%
$
(1,584)
(0.6)
%
Concrete segment
9,091
3.6
%
1,076
0.4
%
Total
$
21,534
$
(508)
Orion Group Holdings, Inc. and
Subsidiaries
Reconciliation of Adjusted Net
Income (Loss)
(In thousands except per share
information)
(Unaudited)
Three months ended
Nine months ended
September 30,
September 30,
2020
2019
2020
2019
Net income (loss)
$
11,803
$
4,039
$
16,554
$
(5,518)
One-time charges and the tax effects:
ERP implementation
486
—
796
—
ISG initiative
—
1,058
369
3,862
Severance
48
43
120
483
Unamortized debt issuance costs on debt
extinguishment
—
—
—
399
Insurance recovery on disposal, net
(2,859)
—
(2,859)
—
Recovery on disputed receivable
(898)
—
(898)
—
Tax rate of 23% applied to one-time
charges (1)
741
(253)
569
(1,091)
Total one-time charges and the tax
effects
(2,482)
848
(1,903)
3,653
Federal and state tax valuation
allowances
(2,231)
(595)
(3,862)
451
Adjusted net income (loss)
$
7,090
$
4,292
$
10,789
$
(1,414)
Adjusted EPS
$
0.23
$
0.15
$
0.36
$
(0.05)
______________________________
(1)
Items are taxed discretely using the Company's blended tax
rate.
Orion Group Holdings, Inc. and
Subsidiaries
Adjusted EBITDA and Adjusted
EBITDA Margin Reconciliations
(In Thousands, Except Margin
Data)
(Unaudited)
Three months ended
Nine months ended
September 30,
September 30,
2020
2019
2020
2019
Net income (loss)
$
11,803
$
4,039
$
16,554
$
(5,518)
Income tax expense (benefit)
303
467
1,660
920
Interest expense, net
1,094
1,603
3,571
4,664
Depreciation and amortization
6,766
7,080
20,662
21,342
EBITDA (1)
19,966
13,189
42,447
21,408
Stock-based compensation
258
564
1,887
2,292
ERP implementation
486
—
796
—
ISG initiative
—
1,058
369
3,862
Severance
48
43
120
483
Insurance recovery on disposal, net
(2,859)
—
(2,859)
—
Recovery on disputed receivable
(898)
—
(898)
—
Adjusted EBITDA(2)
$
17,001
$
14,854
$
41,862
$
28,045
Operating income (loss) margin (3)
7.0
%
3.1
%
4.2
%
(0.1)
%
Impact of depreciation and
amortization
3.6
%
3.5
%
3.8
%
4.2
%
Impact of stock-based compensation
0.1
%
0.3
%
0.3
%
0.5
%
Impact of ERP implementation
0.3
%
—
%
0.1
%
—
%
Impact of ISG initiative
—
%
0.5
%
0.1
%
0.8
%
Impact of severance
—
%
—
%
—
%
0.1
%
Impact of insurance recovery on disposal,
net
(1.5)
%
—
%
(0.5)
%
—
%
Impact of recovery on disputed
receivable
(0.5)
%
—
%
(0.2)
%
—
%
Adjusted EBITDA margin(2)
9.0
%
7.4
%
7.8
%
5.5
%
_____________________________
(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 stock-based compensation, ERP implementation, the ISG
initiative, severance, insurance recovery, net, and reserve on
disputed accounts receivables. 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.
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
Three months ended
September 30,
September 30,
2020
2019
2020
2019
Operating income (loss)
8,992
4,863
4,093
1,229
Other income (expense), net (1)
3,147
2,296
(3,032)
(2,279)
Depreciation and amortization
4,543
4,960
2,223
2,120
EBITDA (2)
16,682
12,119
3,284
1,070
Stock-based compensation
227
513
31
51
ERP implementation
262
—
224
—
ISG initiative
—
570
—
488
Severance
—
43
48
—
Insurance recovery on disposal, net
(2,859)
—
—
—
Recovery on disputed receivable
(898)
—
—
—
Adjusted EBITDA(3)
$
13,414
$
13,245
$
3,587
$
1,609
Operating income (loss) margin (4)
10.8
%
6.7
%
1.4
%
(1.2)
%
Impact of depreciation and
amortization
4.0
%
4.6
%
2.9
%
2.3
%
Impact of stock-based compensation
0.2
%
0.5
%
—
%
0.1
%
Impact of ERP implementation
0.2
%
—
%
0.3
%
—
%
Impact of ISG initiative
—
%
0.5
%
—
%
0.5
%
Impact of severance
—
%
—
%
0.1
%
—
%
Impact of insurance recovery on disposal,
net
(2.5)
%
—
%
—
%
—
%
Impact of recovery on disputed
receivable
(0.8)
%
—
%
—
%
—
%
Adjusted EBITDA margin (3)
11.9
%
12.3
%
4.7
%
1.7
%
Marine
Concrete
Nine months ended
Nine months ended
September 30,
September 30,
2020
2019
2020
2019
Operating income (loss)
12,443
(1,584)
9,091
1,076
Other income (expense), net (1)
9,389
8,762
(9,138)
(8,188)
Depreciation and amortization
14,063
14,975
6,599
6,367
EBITDA (2)
35,895
22,153
6,552
(745)
Stock-based compensation
1,767
2,064
120
228
ERP implementation
417
—
379
—
ISG initiative
190
1,710
179
2,152
Severance
26
483
94
—
Insurance recovery on disposal, net
(2,859)
—
—
—
Recovery on disputed receivable
(898)
—
—
—
Adjusted EBITDA(3)
$
34,538
$
26,410
$
7,324
$
1,635
Operating(loss) income margin (4)
7.6
%
2.7
%
(0.0)
%
(2.8)
%
Impact of depreciation and
amortization
4.8
%
5.8
%
2.6
%
2.5
%
Impact of stock-based compensation
0.6
%
0.8
%
—
%
0.1
%
Impact of ERP implementation
0.1
%
—
%
0.2
%
—
%
Impact of ISG initiative
0.1
%
0.7
%
0.1
%
0.9
%
Impact of severance
—
%
0.2
%
—
%
—
%
Impact of insurance recovery on disposal,
net
(1.0)
%
—
%
—
%
—
%
Impact of recovery on disputed
receivable
(0.3)
%
—
%
—
%
—
%
Adjusted EBITDA margin (3)
11.9
%
10.2
%
2.9
%
0.7
%
________________________________
(1)
Primarily consists of corporate overhead costs recorded to
the marine segment as part of operating income(loss) and allocated
from the marine segment to the concrete segment in other income
(expense) line. Allocated amounts net to zero on a consolidated
basis.
(2)
EBITDA is a non-GAAP measure that represents earnings before
interest, taxes, depreciation and amortization.
(3)
Adjusted EBITDA is a non-GAAP measure that represents EBITDA
adjusted for stock-based compensation, ERP implementation, the ISG
initiative, severance, insurance recovery, net, and reserve on
disputed accounts receivables. Adjusted EBITDA margin is a non-GAAP
measure calculated by dividing Adjusted EBITDA by contract
revenues.
(4)
Operating income margin is calculated by dividing operating
income plus other income (expense), net by contract revenues.
Orion Group Holdings, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Cash Flows Summary
(In Thousands)
(Unaudited)
Three months ended
Nine months ended
September 30,
September 30,
2020
2019
2020
2019
Net income (loss)
$
11,803
$
4,039
$
16,554
$
(5,518)
Adjustments to remove non-cash and
non-operating items
1,505
8,538
19,333
27,337
Cash flow from net income after adjusting
for non-cash and non-operating items
13,308
12,577
35,887
21,819
Change in operating assets and liabilities
(working capital)
(8,006)
(13,392)
2,489
(23,716)
Cash flows provided by (used in) operating
activities
$
5,302
$
(815)
$
38,376
$
(1,897)
Cash flows used in investing
activities
$
(153)
$
(4,507)
$
(2,197)
$
(9,648)
Cash flows (used in) provided by financing
activities
$
(12,760)
$
3,913
$
(34,533)
$
4,211
Capital expenditures (included in
investing activities above)
$
(4,408)
$
(4,917)
$
(9,444)
$
(13,035)
Orion Group Holdings, Inc. and
Subsidiaries
Condensed Consolidated
Statements of Cash Flows
(In Thousands)
(Unaudited)
Nine months ended September
30,
2020
2019
Cash flows from operating activities
Net income (loss)
$
16,554
$
(5,518)
Adjustments to reconcile net income (loss)
to net cash used in operating activities:
Depreciation and amortization
18,175
19,609
Amortization of ROU operating leases
4,449
4,145
Amortization of ROU finance leases
2,487
1,733
Unamortized debt issuance costs upon debt
modification
—
399
Amortization of deferred debt issuance
costs
529
312
Deferred income taxes
27
44
Stock-based compensation
1,887
2,292
Gain on disposal of assets, net
(7,734)
(1,197)
Allowance for doubtful accounts
(487)
—
Change in operating assets and
liabilities, net of effects of acquisitions:
Accounts receivable
12,151
(35,242)
Income tax receivable
—
(330)
Inventory
(291)
310
Prepaid expenses and other
1,667
1,674
Costs and estimated earnings in excess of
billings on uncompleted contracts
(1,807)
(29,063)
Accounts payable
(22,583)
13,702
Accrued liabilities
26,282
1,660
Operating lease liabilities
(4,079)
(4,434)
Income tax payable
(1,037)
755
Billings in excess of costs and estimated
earnings on uncompleted contracts
(7,814)
27,252
Net cash provided by (used in) operating
activities
38,376
(1,897)
Cash flows from investing activities:
Proceeds from sale of property and
equipment
5,821
1,363
Purchase of property and equipment
(9,444)
(13,035)
Contributions to CSV life insurance
(99)
(550)
Insurance claim proceeds related to
property and equipment
1,525
2,574
Net cash used in investing activities
(2,197)
(9,648)
Cash flows from financing activities:
Borrowings from Credit Facility
10,000
49,000
Payments made on borrowings from Credit
Facility
(41,225)
(59,460)
Loan costs from Credit Facility
(369)
(1,430)
Payments of finance lease liabilities
(2,751)
(2,144)
Purchase of vested stock-based awards
(188)
—
Exercise of stock options
—
35
Net cash used in financing activities
(34,533)
4,211
Net change in cash, cash equivalents and
restricted cash
1,646
(7,334)
Cash, cash equivalents and restricted cash
at beginning of period
1,086
8,684
Cash, cash equivalents and restricted cash
at end of period
$
2,732
$
1,350
Orion Group Holdings, Inc. and
Subsidiaries
Condensed Consolidated Balance
Sheets
(In Thousands, Except Share
and Per Share Information)
September 30,
December 31,
2020
2019
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
2,732
128
Restricted cash
—
958
Accounts receivable:
Trade, net of allowance for credit losses
of $411 and $2,600, respectively
90,612
116,540
Retainage
36,230
42,547
Income taxes receivable
962
962
Other current
25,931
2,680
Inventory
1,936
1,114
Costs and estimated earnings in excess of
billings on uncompleted contracts
43,196
41,389
Prepaid expenses and other
4,593
5,647
Total current assets
206,192
211,965
Property and equipment, net of
depreciation
125,911
132,348
Operating lease right-of-use assets, net
of amortization
15,619
17,997
Financing lease right-of-use assets, net
of amortization
12,775
7,896
Inventory, non-current
6,506
7,037
Intangible assets, net of amortization
10,595
12,147
Deferred income tax asset
67
85
Other non-current
4,855
5,369
Total assets
$
382,520
$
394,844
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Current debt, net of issuance costs
$
4,347
$
3,668
Accounts payable:
Trade
47,810
70,421
Retainage
590
562
Accrued liabilities
45,925
16,966
Income taxes payable
486
1,523
Billings in excess of costs and estimated
earnings on uncompleted contracts
40,967
48,781
Current portion of operating lease
liabilities
4,766
5,043
Current portion of financing lease
liabilities
4,543
2,788
Total current liabilities
149,434
149,752
Long-term debt, net of debt issuance
costs
36,285
68,029
Operating lease liabilities
11,545
13,596
Financing lease liabilities
7,670
3,760
Other long-term liabilities
20,053
20,436
Deferred income tax liability
214
205
Interest rate swap liability
1,795
1,045
Total liabilities
226,996
256,823
Stockholders’ equity:
Preferred stock -- $0.01 par value,
10,000,000 authorized, none issued
—
—
Common stock -- $0.01 par value,
50,000,000 authorized, 31,126,326 and 30,303,395 issued; 30,415,095
and 29,592,164 outstanding at September 30, 2020 and December 31,
2019, respectively
311
303
Treasury stock, 711,231 shares, at cost,
as of September 30, 2020 and December 31, 2019, respectively
(6,540)
(6,540)
Accumulated other comprehensive loss
(1,795)
(1,045)
Additional paid-in capital
184,214
182,523
Retained loss
(20,666)
(37,220)
Total stockholders’ equity
155,524
138,021
Total liabilities and stockholders’
equity
$
382,520
$
394,844
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201028006139/en/
Orion Group Holdings Inc. Robert Tabb, Vice President & CFO
Rebecca Maxwell, Vice President, Finance (713) 852-6500
www.oriongroupholdingsinc.com -OR- INVESTOR RELATIONS
COUNSEL: The Equity Group Inc. Fred Buonocore, CFA (212)
836-9607 Mike Gaudreau (212) 836-9620
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