ENGlobal Reports Second Quarter 2017 Results
August 09 2017 - 6:55AM
Marketwired
ENGlobal Reports Second Quarter 2017 Results
HOUSTON, TX-(Marketwired - Aug 9, 2017) - ENGlobal (NASDAQ:
ENG), a leading provider of engineering and automation services,
today announced results for the second quarter ended July 1,
2017.
Highlights for the quarter include improved financial trends, as
indicated by quarterly comparisons which show sequential and
year-over-year increases in Revenue and Gross Profit Margin, along
with decreases in SG&A expense.
ENGlobal reported net loss of $0.9 million for the second
quarter of 2017 which was a $0.7 million improvement over a net
loss of $1.6 million reported for the prior year period. Net loss
per diluted share was ($0.03) and ($0.06) for the second quarter
just ended and for the second quarter of 2016, respectively.
Revenue increased by $2.1 million to $16.0 million from $13.9
million, or a 15.3% increase, for the three months ended July 1,
2017, as compared to the three months ended June 25, 2016.
Management's Assessment
Mark Hess, ENGlobal's Chief Financial Officer stated: "It is
important to note that our pre-tax loss for the quarter was $0.5
million, or a $1.0 million improvement over our pre-tax loss last
year and a $1.2 million improvement over the pre-tax loss for the
first quarter. Compounding the loss for the second quarter of this
year was a tax provision for the quarter of $0.4 million, which
increased our loss to $0.9 million after tax. This provision was
unusually high and is primarily the result of stock options that
expired during the quarter and a slight reduction in the expected
annual income tax benefit rate."
Mr. Hess continued: "It is encouraging that the Company has
shown improvement in revenue, profit margin, and SG&A for the
second quarter results, as reported today. While still early, we
believe these metrics are an indication that the investments made
in talent and facilities to build a vertically integrated business
are beginning to produce results. As expected, we have seen a shift
from cash to other components of our working capital with this
increase in activity. We expect this shift to continue in the near
term as our volumes increase."
William A. Coskey, P.E., Chairman and CEO of ENGlobal added: "We
expect that ENGlobal's strategy of delivering engineered modular
systems with turnkey execution will continue to become a larger
part of our business going forward. We also expect that long-term
financial improvement can be realized as a result of increased
project scope which serves to leverage our resources."
Mr. Coskey continued: "ENGlobal is now proud to offer a complete
set of skills for modular project execution - engineering,
mechanical fabrication, automation configuration, and automaton
integration. This combination of skills, together with our complete
project support services, is a new message from ENGlobal that is
resonating with our clientele."
The following is a summary of the income statement for the three
months ended July 1, 2017 and June 25, 2016:
|
|
|
|
|
|
|
(amounts in thousands)
|
|
Three months ended July 1, 2017
|
|
|
Three Months ended June 25, 2016
|
|
Revenue
|
|
$
|
15,966
|
|
|
$
|
13,842
|
|
Gross Profit
|
|
|
2,513
|
|
|
|
1,853
|
|
General & Administrative Expenses
|
|
|
3,057
|
|
|
|
3,313
|
|
Operating Loss
|
|
|
(544
|
)
|
|
|
(1,460
|
)
|
Net loss
|
|
|
(895
|
)
|
|
|
(1,603
|
)
|
|
|
|
|
|
|
|
|
|
The following table presents certain balance sheet items as of
July 1, 2017 and December 31, 2016:
(amounts in thousands)
|
|
As of July 1, 2017
|
|
As of December 31, 2016
|
Cash
|
|
$
|
11,172
|
|
$
|
15,687
|
Working capital
|
|
|
20,196
|
|
|
22,200
|
|
|
|
|
|
|
|
The following table illustrates the composition of the Company's
revenue and profitability for its operations for the three and six
months ended July 1, 2017 and June 25, 2016:
(amounts in thousands)
|
|
Three months ended July 1, 2017
|
|
Three Months ended June 25, 2016
|
|
|
|
|
% of
|
|
Gross
|
|
Operating
|
|
|
|
% of
|
|
Gross
|
|
Operating
|
|
|
Total
|
|
Total
|
|
Profit
|
|
Profit
|
|
Total
|
|
Total
|
|
Profit
|
|
Profit
|
Segment
|
|
Revenue
|
|
Revenue
|
|
Margin
|
|
Margin
|
|
Revenue
|
|
Revenue
|
|
Margin
|
|
Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Engineering & Construction
|
|
$10,095
|
|
63.2%
|
|
17.6%
|
|
8.9%
|
|
$8,257
|
|
59.7%
|
|
9.6%
|
|
0.4%
|
Automation
|
|
5,871
|
|
36.8%
|
|
12.5%
|
|
3.5%
|
|
5,585
|
|
40.3%
|
|
19.1%
|
|
5.2%
|
Consolidated
|
|
$15,966
|
|
100.0%
|
|
15.7%
|
|
(3.4)%
|
|
$13,842
|
|
100.0%
|
|
13.4%
|
|
(10.5)%
|
|
|
|
|
|
(amounts in thousands)
|
|
Six months ended July 1, 2017
|
|
Six Months ended June 25, 2016
|
|
|
|
|
% of
|
|
Gross
|
|
Operating
|
|
|
|
% of
|
|
Gross
|
|
Operating
|
|
|
Total
|
|
Total
|
|
Profit
|
|
Profit
|
|
Total
|
|
Total
|
|
Profit
|
|
Profit
|
Segment
|
|
Revenue
|
|
Revenue
|
|
Margin
|
|
Margin
|
|
Revenue
|
|
Revenue
|
|
Margin
|
|
Margin
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Engineering & Construction
|
|
$18,260
|
|
64.2%
|
|
14.9%
|
|
5.1%
|
|
$16,784
|
|
58.6%
|
|
8.5%
|
|
(0.6)%
|
Automation
|
|
10,180
|
|
35.8%
|
|
15.0%
|
|
3.8%
|
|
11,870
|
|
41.4%
|
|
17.7%
|
|
4.9%
|
Consolidated
|
|
$28,440
|
|
100.0%
|
|
14.9%
|
|
(7.8)%
|
|
$28,654
|
|
100.0%
|
|
13.4%
|
|
(11.1)%
|
The Company's Quarterly Report on Form 10-Q for the quarterly
period ended July 1, 2017 is expected to be filed with the
Securities and Exchange Commission reflecting these results by the
end of the day on Wednesday, August 9, 2017.
About ENGlobal
ENGlobal (NASDAQ: ENG) is a provider of engineering and
automation services primarily to the energy sector throughout the
United States and internationally. ENGlobal operates through two
business segments: Automation and Engineering. ENGlobal's
Automation segment provides services related to the design,
integration and implementation of advanced automation, information
technology process distributed control, instrumentation and process
analytical systems. The Engineering segment provides consulting
services for the development, management and execution of projects
requiring professional engineering, construction management, and
related support services and the fabrication operation. Within the
Engineering segment, ENGlobal's Government Services group provides
engineering, design, installation and operation and maintenance of
various government, public sector and international facilities, and
specializes in the turnkey installation and maintenance of
automation and instrumentation systems for the U.S. Defense
industry worldwide. Further information about the Company and its
businesses is available at www.ENGlobal.com.
Safe Harbor for Forward-Looking Statements
The statements above regarding the Company's expectations
regarding its operations and certain other matters discussed in
this press release may constitute forward-looking statements within
the meaning of the federal securities laws and are subject to risks
and uncertainties including, but not limited to: (1) the effect of
economic downturns and the volatility and level of oil and natural
gas prices; (2) our ability to retain existing customers and
attract new customers; (3) our ability to accurately estimate the
overall risks, revenue or costs on a contract; (4) the risk of
providing services in excess of original project scope without
having an approved change order; (5) our ability to execute our
plan to enter into the modular solutions market; (6) our ability to
attract and retain key professional personnel; (7) our ability to
fund our operations and grow our business utilizing cash on hand,
internally generated funds and other working capital; (8) our
ability to obtain additional financing, including pursuant to a new
credit facility, when needed: (9) our dependence on one or a few
customers; (10) the risks of internal system failures of our
information technology systems, whether caused by us, third-party
service providers, intruders or hackers, computer viruses, natural
disasters, power shortages or terrorist attacks; (11) our ability
to realize revenue projected in our backlog and our ability to
collect accounts receivable and process accounts payable in a
timely manner; (12) the uncertainties related to the U.S.
Government's budgetary process and their effects on our long-term
U.S. Government contracts; (13) operational and political risks in
Russia and Kazakhstan along the Caspian Sea; (14) the risk of
unexpected liability claims or poor safety performance; (15) our
ability to identify, consummate and integrate potential
acquisitions; (16) our reliance on third-party subcontractors and
equipment manufacturers; and (17) our ability to purchase shares
under our stock purchase program due to changes in stock price and
other considerations. Actual results and the timing of certain
events could differ materially from those projected in or
contemplated by the forward-looking statements due to a number of
factors detailed from time to time in ENGlobal's filings with the
Securities and Exchange Commission. In addition, reference is
hereby made to cautionary statements set forth in the Company's
most recent reports on Form 10-K and 10-Q, and other SEC filings.
Actual results and the timing of certain events could differ
materially from those projected in or contemplated by the
forward-looking statements due to a number of factors detailed from
time to time in ENGlobal's filings with the Securities and Exchange
Commission. In addition, reference is hereby made to cautionary
statements set forth in the Company's most recent reports on Form
10-K and 10-Q, and other SEC filings.
Click here to join our email list:
http://www.b2i.us/irpass.asp?BzID=702&to=ea&s=0
Contact: Mark Hess Phone: 281-878-1040 E-mail:
IR@ENGlobal.com
ENGlobal (NASDAQ:ENG)
Historical Stock Chart
From Jul 2024 to Jul 2024
ENGlobal (NASDAQ:ENG)
Historical Stock Chart
From Jul 2023 to Jul 2024