Drilling-services company Layne Christensen Co. (LAYN) swung to
a steeper-than-expected fiscal third-quarter loss as it posted red
ink in its mineral services and geoconstruction segments.
Layne--which provides products and construction services for the
water supply, mineral exploration and environmental
markets--reported a 48% drop in mineral services revenue to $39.8
million. The segment made up 18% of revenue.
"The outlook for Mineral Services remains challenged due to
continuing declines in global mineral exploration activity which
will hinder our results for at least the balance of [fiscal year]
2014," Chief Executive Rene J. Robichaud said.
The segment's results were hurt by charges from a Foreign
Corrupt Practices Act investigation after the Securities and
Exchange Commission in May found that Layne received $4.8 million
in benefits from making improper payments, and made an accrual at
the time.
Meanwhile, geoconstruction revenue fell 55% to $20.1 million on
weaker demand in the U.S. and South America. However, the division
gained three new contracts in the last quarter.
Layne also moved its corporate headquarters to The Woodlands,
Texas, from Kansas to enhance its access to some of the nation's
leading energy companies, leading to a $3.5 million increase in
corporate costs.
For the quarter ended Oct. 31, Layne reported a loss of $15.8
million, or 80 cents a share, compared with a year-earlier profit
of $8.5 million, or 43 cents a share. The most-recent quarter
included costs from acquisitions, moves and new contracts.
Excluding those items, Layne posted a loss of 97 cents a share
compared with a profit of 43 cents a share.
Total revenue fell 23% to $216.5 million.
Analysts polled by Thomson Reuters forecast a per-share loss of
36 cents on revenue of $245 million.
Among its other segments, heavy-civil revenue fell 9.4% to $63.8
million. Inliner revenue rose 36% to $43.8 million on projects in
Florida, Maryland and Indiana. Energy services revenue rose 38% to
$1.7 million.
Shares closed Friday at $15.72 and were inactive premarket. The
stock is down 34% year-to-date.
Write to Everdeen Mason at everdeen.mason@wsj.com
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