- Revenues for the year were a record, exceeding $1 billion for
the second time in the Company's history.
- Net income for the fourth quarter was $8.8 million, or $0.45
per share, compared to $2.4 million or $0.12 per share last
year.
- Net income for the year was $30.0 million, or $1.53 per share,
compared to $1.4 million, or $0.07 per share last year.
- Mineral Exploration Division results exceeded last year, with
revenues up 59.2% and 69.2% for the quarter and year, respectively,
and earnings up 118.0% and 213.5%.
- Backlog in the Water Infrastructure Division was $585.2 million
as of January 31, 2011, compared to $554.2 million as of January
31, 2010.
|
|
|
|
|
Financial Data |
Three Months |
% |
Twelve Months |
% |
(000's, except per share data) |
1/31/11 |
1/31/10 |
Change |
1/31/11 |
1/31/10 |
Change |
Revenues |
|
|
|
|
|
|
--Water Infrastructure |
$ 211,632 |
$ 181,933 |
16.3 |
$ 788,397 |
$ 698,506 |
12.9 |
--Mineral Exploration |
51,621 |
32,424 |
59.2 |
199,946 |
118,188 |
69.2 |
--Energy |
5,418 |
11,888 |
(54.4) |
25,754 |
45,940 |
(43.9) |
--Other |
3,176 |
953 |
233.3 |
11,562 |
3,783 |
205.6 |
Total revenues |
$ 271,847 |
$ 227,198 |
19.7 |
$ 1,025,659 |
$ 866,417 |
18.4 |
Net income attributable to Layne
Christensen Company |
8,776 |
2,388 |
267.5 |
29,991 |
1,365 |
2,097.1 |
Diluted EPS |
0.45 |
0.12 |
275.0 |
1.53 |
0.07 |
2,085.7 |
"Layne Christensen finished its fiscal year in record fashion
surpassing $1 billion in revenue for only the second time. Earnings
were strong for the quarter and nearly doubled for the year, driven
by a rebound in mineral exploration, contributions from the
Afghanistan water well project for the U.S. military, increased
activity in sewer pipe rehabilitation and earnings from
acquisitions in Geoconstruction. Our primary challenges going
forward are replacing the Afghanistan project and low natural gas
prices facing our Energy Division. Layne enters the new year
with a strong balance sheet and a new credit agreement signed in
March that provides for $300 million in borrowing capacity at
attractive rates and terms. And finally, I would be remiss in
closing out fiscal 2011 by not mentioning Layne Christensen's most
crowning achievement, our role, along with our Latin American
partners, in drilling to save the 33 trapped miners in Chile in
October last year. We are extremely proud to have been part of
that successful effort. It was a once in a lifetime
experience."—
Andrew B. Schmitt, President and Chief Executive Officer
Layne Christensen Company (Nasdaq:LAYN), today announced net income
for the fiscal year ended January 31, 2011, of $29,991,000, or
$1.53 per share, compared to $1,365,000, or $0.07 per share last
year. Net income for the fourth quarter was $8,776,000, or $0.45
per share, compared to net income of $2,388,000, or $0.12 per
share, in the fourth quarter last year.
Revenues increased $44,649,000, or 19.7%, to $271,847,000 for
the three months ended January 31, 2011, and increased
$159,242,000, or 18.4%, to $1,025,659,000 for the twelve months
ended January 31, 2011. Revenues increased for the fourth quarter
and for the year in the Water Infrastructure Division primarily due
to additional revenues from operations acquired in the current and
prior year as well as increases in sewer rehabilitation revenues
and from our water supply project in Afghanistan. Revenues
increased for the fourth quarter and for the year in the Mineral
Exploration Division primarily due to increased activity levels
across all locations with the largest increases in Africa, the
Western U.S. and Mexico. Revenues decreased for the fourth quarter
and for the year in the Energy Division primarily due to lower
natural gas prices and the expiration of favorably priced forward
sales contracts in the first quarter of this year. A further
discussion of results of operations by division is presented
below.
Cost of revenues increased $33,644,000, or 19.3% to $207,962,000
(76.5% of revenues) and $125,737,000, or 19.0% to $787,289,000
(76.8% of revenues) for the three and twelve months ended January
31, 2011, compared to $174,318,000 (76.7% of revenues) and
$661,552,000 (76.3% of revenues) for the same periods last
year. The changes as a percentage of revenues were primarily
due to margin pressures in our heavy construction and energy
businesses, partially offset by higher margins in mineral
exploration, on our work in Afghanistan and on certain soil
stabilization projects.
Selling, general and administrative expenses increased to
$39,663,000 and $142,808,000 for the three and twelve months ended
January 31, 2011, compared to $34,736,000 and $128,244,000 for the
same periods last year. The increases were primarily the result of
increased incentive compensation expenses of $2,801,000 and
$10,399,000, $1,467,000 and $5,578,000 in added expenses from
acquired operations, increases in consulting expenses of $1,619,000
and $5,023,000 primarily related to systems implementation and
merger and acquisition projects and increases in other compensation
costs of $737,000 and $1,456,000. These increases were partially
offset by a reduction of $4,980,000 in settlement charges recorded
last year for the elimination of our hourly pension plan
liabilities.
Depreciation, depletion and amortization decreased to
$14,414,000 and $53,468,000 for the three and twelve months ended
January 31, 2011, compared to $14,835,000 and $57,679,000 for the
same periods last year. The decreases were primarily due to
$798,000 and $8,340,000 lower depletion in the Energy Division as a
result of updated estimates of economically recoverable gas
reserves, partially offset by higher depreciation in the Water
Infrastructure Division from acquired operations and ongoing
capital expenditures.
Equity in earnings of affiliates increased to $5,356,000 and
$13,153,000 for the three and twelve months ended January 31, 2011,
compared to $2,673,000 and $8,198,000 for the same periods last
year. The increases reflect the impact of an improved minerals
exploration market in Latin America, primarily for gold and copper
in Chile and Peru.
In the twelve months ended January 31, 2010, the Company
recorded a non-cash impairment of oil and gas properties of
$21,642,000, or $13,039,000 after income taxes, as well as received
litigation settlements valued at $3,495,000. There were no such
impairments recorded in fiscal 2011.
Interest expense decreased to $214,000 and $1,594,000 for the
three and twelve months ended January 31, 2011, compared to
$528,000 and $2,734,000 for the same periods last year. The
decreases were primarily a result of scheduled debt reductions.
The Company recorded income tax expense of $5,012,000 (an
effective rate of 32.6%) and $22,581,000 (an effective rate of
41.7%) for the three and twelve months ended January 31, 2011,
compared to expense of $3,613,000 (an effective rate of 60.2%) and
$5,093,000 (an effective rate of 78.9%) for the same periods last
year. Excluding the impact of the impairment for the twelve months
ended January 31, 2010, the Company would have recorded income tax
expense of $13,696,000 (an adjusted effective rate of 48.7%). The
effective rates for the current year periods were lower than the
adjusted rates for the prior periods due to the reduced impact of
non-deductible expenses and the tax treatment of certain foreign
operations. As earnings increase, these factors will have a
reduced impact on the effective rate since they are relatively
fixed.
Water Infrastructure
Division |
Three Months Ended
January 31, |
Twelve Months Ended
January 31, |
(in thousands) |
2011 |
2010 |
2011 |
2010 |
Revenues |
$ 211,632 |
$ 181,933 |
$ 788,397 |
$ 698,506 |
Equity in earnings of affiliates |
437 |
-- |
517 |
-- |
Income before income taxes |
14,324 |
8,562 |
46,321 |
33,017 |
Water Infrastructure revenues increased 16.3% and 12.9% to
$211,632,000 and $788,397,000 for the three and twelve months ended
January 31, 2011, compared to $181,933,000 and $698,506,000 for the
same periods last year. The increases were primarily attributable
to additional revenues of $26,300,000 and $88,973,000 from
operations acquired in the current and prior year, increases of
$6,124,000 and $15,333,000 in sewer rehabilitation revenue and
increases in revenue from our water supply contract in Afghanistan.
During the fourth quarter and for the year, we have recognized
revenue of $5,392,000 and $20,269,000, respectively, related to our
water supply contract in Afghanistan, compared to $7,332,000 in the
fourth quarter last year. We have been informed that the drilling
program in Afghanistan will be curtailed, and expect our
involvement to wind down over the course of the first quarter of
fiscal 2012. The increased revenue in sewer rehabilitation was
primarily concentrated in the Eastern U.S. and Texas. The increases
in revenues were partially offset for the quarter by a reduction of
$6,390,000 in Geoconstruction revenue primarily from our New
Orleans project which was completed earlier this year, and for the
year by a reduction in heavy construction revenue of $34,105,000
primarily from a large utility contract in Colorado that was
substantially completed last year.
Income before income taxes for the Water Infrastructure Division
increased 67.3% and 40.3% to $14,324,000 and $46,321,000 for the
three and twelve months ended January 31, 2011, compared to
$8,562,000 and $33,017,000 for the same periods last year. The
increases were primarily attributable to earnings of $7,096,000 and
$6,874,000 from operations acquired in the current and prior year
and our project in Afghanistan, partially offset by reduced
earnings in our heavy construction operations and overall increases
of $36,000 and $1,054,000 in incentive compensation. The
Afghanistan project contributed $4,388,000 and $14,845,000 to
income before income taxes for the three and twelve months ended
January 31, 2011, compared to $3,300,000 in the fourth quarter last
year.
The backlog in the Water Infrastructure Division was
$585,225,000 as of January 31, 2011, compared to $554,211,000 as of
January 31, 2010.
Mineral Exploration Division
|
Three Months Ended
January 31, |
Twelve Months Ended
January 31, |
(in thousands) |
2011 |
2010 |
2011 |
2010 |
Revenues |
$ 51,621 |
$ 32,424 |
$ 199,946 |
$ 118,188 |
Equity in earnings of affiliates |
4,919 |
2,673 |
12,636 |
8,198 |
Income before income taxes |
8,404 |
3,855 |
34,947 |
11,149 |
Mineral Exploration revenues increased 59.2% and 69.2% to
$51,621,000 and $199,946,000 for the three and twelve months ended
January 31, 2011, compared to revenues of $32,424,000 and
$118,188,000 for the same periods last year. The increases were
driven by increased activity levels across all locations, the
largest of which were in Africa, the Western U.S. and Mexico.
Income before income taxes for the Mineral Exploration Division
increased 118.0% and 213.5% to $8,404,000 and $34,947,000 for the
three and twelve months ended January 31, 2011, compared to
$3,855,000 and $11,149,000 for the same periods last year. The
increases resulted primarily from improved margins, combined with
higher revenues. Equity earnings from our affiliates, reduced
earlier in the year by a customer driven project delay, improved in
the last half of the year as the projects were caught up,
increasing $2,246,000 and $4,438,000 for the three and twelve
months ended January 31, 2011. During fiscal 2010, the Company
received a litigation settlement in Australia of
$2,828,000. Earnings for the three and twelve months ended
January 31, 2011 were offset by increases of $1,342,000 and
$4,076,000, respectively, in incentive compensation and by costs
incurred in connection with our internal Foreign Corrupt Practices
Act (FCPA) investigation.
Energy Division |
Three Months Ended
January 31, |
Twelve Months Ended
January 31, |
(in thousands) |
2011 |
2010 |
2011 |
2010 |
Revenues |
$ 5,418 |
$ 11,888 |
$ 25,754 |
$ 45,940 |
Income (loss) before income taxes |
400 |
3,833 |
3,291 |
(6,393) |
Income before income taxes excluding non-cash
impairment charges |
400 |
3,833 |
3,291 |
15,249 |
Energy revenues decreased 54.4% and 43.9% to $5,418,000 and
$25,754,000 for the three and twelve months ended January 31, 2011,
compared to revenues of $11,888,000 and $45,940,000 for the same
periods last year. The decrease was primarily attributable to lower
natural gas prices and the expiration of favorably priced forward
sales contracts in the first quarter of this year. Net gas
production for the three and twelve months ended January 31, 2011
was 1,068 and 4,455 MMcf, compared to 1,138 and 4,618 MMcf for the
same periods last year. The average net sales price per mcf on
production was $3.90 and $4.78, compared to $8.94 and $8.53 last
year. The net sales price excludes revenues generated from
third-party gas.
For the twelve months ended January 31, 2010, the Company
recorded a non-cash impairment charge of $21,642,000, or
$13,039,000 after income tax, for the carrying value of the assets
in excess of future net cash flows as well as settlement gains, net
of attorney fees, of $667,000 related to litigation against former
officers of a subsidiary and associated energy production
companies.
Excluding the non-cash impairment charge and litigation gains,
income before income taxes for the Energy Division decreased to
$400,000 and $3,291,000 for the three and twelve months ended
January 31, 2011, compared to income of $3,833,000 and $15,249,000
for the same periods last year. The decreases in income before
income taxes were due to the impact on revenues from lower natural
gas prices and the expiration of forward sales contracts as noted
above, partially offset by depletion decreasing $798,000 and
$8,340,000 for the respective periods.
Other |
Three Months Ended
January 31, |
Twelve Months Ended
January 31, |
(in thousands) |
2011 |
2010 |
2011 |
2010 |
Revenues |
$ 3,176 |
$ 953 |
$ 11,562 |
$ 3,783 |
Income before income taxes |
275 |
59 |
1,470 |
308 |
Other revenues increased primarily as a result of revenue of
$1,993,000 and $6,471,000 from machining and fabrication
operations. The increase in income before income taxes resulted
primarily from energy service related projects.
Unallocated Corporate Expenses
Corporate expenses not allocated to individual divisions,
primarily included in selling, general and administrative expenses,
were $7,805,000 and $30,267,000 for the three and twelve months
ended January 31, 2011, compared to $9,780,000 and $28,889,000 for
the same periods last year. The three and twelve months ended
January 31, 2011, were impacted by increases in incentive
compensation of $650,000 and $2,950,000, and increases in
consulting fees of $1,158,000 and $4,000,000 related to systems
implementation and merger and acquisition projects. These increases
were partially offset by a reduction of $4,980,000 in settlement
charges recorded last year for the elimination of our hourly
pension plan liabilities.
Summary of Operating Segment Reconciliation
Data
|
Three Months Ended
January 31, |
Twelve Months Ended
January 31, |
(in thousands) |
2011 |
2010 |
2011 |
2010 |
Revenues |
|
|
|
|
Water Infrastructure |
$ 211,632 |
$ 181,933 |
$ 788,397 |
$ 698,506 |
Mineral Exploration |
51,621 |
32,424 |
199,946 |
118,188 |
Energy |
5,418 |
11,888 |
25,754 |
45,940 |
Other |
3,176 |
953 |
11,562 |
3,783 |
Total revenues |
$ 271,847 |
$ 227,198 |
$ 1,025,659 |
$ 866,417 |
Equity in earnings of affiliates |
|
|
|
|
Water Infrastructure |
$ 437 |
$ -- |
$ 517 |
$ -- |
Mineral Exploration |
4,919 |
2,673 |
12,636 |
8,198 |
Total equity in earnings of
affiliates |
$ 5,356 |
$ 2,673 |
$ 13,153 |
$ 8,198 |
Income (loss) before income taxes |
|
|
|
|
Water Infrastructure |
$ 14,324 |
$ 8,562 |
$ 46,321 |
$ 33,017 |
Mineral Exploration |
8,404 |
3,855 |
34,947 |
11,149 |
Energy |
400 |
3,833 |
3,291 |
(6,393) |
Other |
275 |
59 |
1,470 |
308 |
Unallocated corporate expenses |
(7,805) |
(9,780) |
(30,267) |
(28,889) |
Interest expense |
(214) |
(528) |
(1,594) |
(2,734) |
Total income before income taxes |
$ 15,384 |
$ 6,001 |
$ 54,168 |
$ 6,458 |
This press release may contain forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Exchange Act of 1934. Such statements may
include, but are not limited to, statements of plans and
objectives, statements of future economic performance and
statements of assumptions underlying such statements, and
statements of management's intentions, hopes, beliefs, expectations
or predictions of the future. Forward-looking statements can often
be identified by the use of forward-looking terminology, such as
"should," "intended," "continue," "believe," "may," "hope,"
"anticipate," "goal," "forecast," "plan," "estimate" and similar
words or phrases. Such statements are based on current expectations
and are subject to certain risks, uncertainties and assumptions,
including but not limited to: the outcome of the ongoing internal
investigation into, among other things, the legality, under the
FCPA and local laws, of certain payments to agents and government
officials in certain countries in Africa relating to the payment of
taxes and the importing of equipment (including any government
enforcement action which could arise out of the matters under
review or that the matters under review may have resulted in a
higher dollar amount of payments or may have a greater financial or
business impact than management currently anticipates), prevailing
prices for various commodities, unanticipated slowdowns in the
Company's major markets, the availability of credit, the risks and
uncertainties normally incident to the construction industry and
exploration for and development and production of oil and gas, the
impact of competition, the effectiveness of operational changes
expected to increase efficiency and productivity, worldwide
economic and political conditions and foreign currency fluctuations
that may affect worldwide results of operations. Should one or more
of these risks or uncertainties materialize, or should underlying
assumptions prove incorrect, actual results may vary materially and
adversely from those anticipated, estimated or projected. These
forward-looking statements are made as of the date of this filing,
and the Company assumes no obligation to update such
forward-looking statements or to update the reasons why actual
results could differ materially from those anticipated in such
forward-looking statements.
Layne Christensen Company provides sophisticated services and
related products for the water, mineral and energy markets.
The Layne Christensen Company logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=3466
LAYNE CHRISTENSEN COMPANY AND
SUBSIDIARIES |
CONSOLIDATED FINANCIAL
DATA |
|
|
|
|
|
|
Three Months Ended
January 31, |
Twelve Months Ended
January 31, |
(in thousands, except per share
data) |
2011 |
2010 |
2011 |
2010 |
Revenues |
$ 271,847 |
$ 227,198 |
$ 1,025,659 |
$ 866,417 |
Cost of revenues (exclusive of depreciation,
depletion, amortization and impairment shown below) |
(207,962) |
(174,318) |
(787,289) |
(661,552) |
Selling, general and administrative
expenses |
(39,663) |
(34,736) |
(142,808) |
(128,244) |
Depreciation, depletion and
amortization |
(14,414) |
(14,835) |
(53,468) |
(57,679) |
Impairment of oil and gas properties |
-- |
-- |
-- |
(21,642) |
Litigation settlement gains |
-- |
-- |
-- |
3,495 |
Equity in earning of affiliates |
5,356 |
2,673 |
13,153 |
8,198 |
Interest expense |
(214) |
(528) |
(1,594) |
(2,734) |
Other income, net |
434 |
547 |
515 |
199 |
Income before income taxes |
15,384 |
6,001 |
54,168 |
6,458 |
Income tax expense |
(5,012) |
(3,613) |
(22,581) |
(5,093) |
Net income |
10,372 |
2,388 |
31,587 |
1,365 |
Net income attributable to noncontrolling
interests |
(1,596) |
-- |
(1,596) |
-- |
Net income attributable to Layne Christensen
Company |
$ 8,776 |
$ 2,388 |
$ 29,991 |
$ 1,365 |
|
|
|
|
|
Basic income per share |
$ 0.45 |
$ 0.12 |
$ 1.55 |
$ 0.07 |
|
|
|
|
|
Diluted income per share |
$ 0.45 |
$ 0.12 |
$ 1.53 |
$ 0.07 |
|
|
|
|
|
Weighted average shares outstanding -
basic |
19,421 |
19,355 |
19,393 |
19,328 |
Dilutive stock options and unvested
shares |
248 |
156 |
185 |
94 |
Weighted average shares outstanding -
dilutive |
19,669 |
19,511 |
19,578 |
19,422 |
|
|
|
As of |
(in thousands) |
January 31,
2011 |
January 31, 2010 |
Balance Sheet Data: |
|
|
Cash and cash equivalents |
$ 44,985 |
$ 84,450 |
Working capital, including current
maturities of long term debt |
84,785 |
119,649 |
Total assets |
810,207 |
730,955 |
Total long term debt, excluding current
maturities |
-- |
6,667 |
Total Layne Christensen Company
stockholders' equity |
501,687 |
466,798 |
|
|
|
Common shares issued and outstanding |
19,540 |
19,435 |
CONTACT: Layne Christensen Company
Jerry W. Fanska
Sr. Vice President Finance
913-677-6858
www.laynechristensen.com
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