Argan, Inc. (NYSE: AGX) today announced financial
results for the three months and fiscal year ended January 31,
2015.
For the year ended January 31, 2015, revenues were $383.1
million compared to $227.5 million for the year ended
January 31, 2014. Gemma Power Systems, LLC and affiliates
(Gemma) contributed $376.7 million, or 98% of revenues in fiscal
2015, compared to $218.6 million, or 96% of revenues in fiscal
2014.
Argan reported consolidated EBITDA (Earnings before interest,
taxes, depreciation and amortization) attributable to the
stockholders of Argan, Inc. of $52.2 million for the year ended
January 31, 2015 compared to $66.3 million for the prior
fiscal year. Gemma reported $58.0 million in EBITDA attributable to
the stockholders of Argan, Inc. for fiscal 2015 compared to $69.5
million for fiscal 2014.
Income from operations for fiscal 2015 was $64.1 million
compared to income from operations for fiscal 2014 of $65.9
million.
Net income attributable to the stockholders of Argan, Inc. for
fiscal 2015 was $30.4 million, or $2.05 per diluted share based on
14,823,000 diluted shares outstanding, compared to $40.1 million,
or $2.78 per diluted share based on 14,427,000 diluted shares
outstanding for fiscal 2014.
For the three months ended January 31, 2015, consolidated
revenues were $102.3 million compared to $59.5 million for the
three months ended January 31, 2014. Gemma contributed $100.8
million, or 98% of consolidated revenues for the fourth quarter of
fiscal 2015, compared to $58.3 million, or 98% of consolidated
revenues for the fourth quarter of fiscal 2014.
Argan reported consolidated EBITDA attributable to the
stockholders of Argan, Inc. of $11.9 million for the three months
ended January 31, 2015 compared to $15.8 million in the fourth
quarter of last fiscal year. Gemma reported $13.7 million in EBITDA
attributable to the stockholders of Argan, Inc. for the three
months ended January 31, 2015 compared to $17.6 million for
the three months ended January 31, 2014.
Income from operations for the three months ended
January 31, 2015 was $15.5 million, compared to income from
operations of $16.4 million for the fourth quarter of fiscal
2014.
For the three months ended January 31, 2015, Argan reported
net income attributable to Argan, Inc. stockholders of $6.0
million, or $0.40 per diluted share based on 14,838,000 diluted
shares outstanding, compared to net income of $9.2 million, or
$0.63 per diluted share based on 14,581,000 diluted shares
outstanding for the fourth quarter of fiscal 2014.
Argan had consolidated cash and cash equivalents of $333.7
million as of January 31, 2015. During the current fiscal
year, Argan used cash of $10.2 million to pay a $0.70 dividend per
share of common stock. Consolidated working capital increased
during the current fiscal year to approximately $148.9 million as
of January 31, 2015 from approximately $133.3 million as of
January 31, 2014. Consolidated tangible net worth attributable
to the stockholders of Argan, Inc. increased to $165.2 million at
January 31, 2015 from $135.7 million at January 31,
2014.
Gemma’s backlog as of January 31, 2015 was $423 million
compared to $790 million as of January 31, 2014. The decrease
in backlog reflects the current year progress on the construction
of the Panda Liberty and Panda Patriot power plants.
Commenting on Argan’s financial results, Rainer Bosselmann,
Chairman and Chief Executive Officer stated, “Gemma’s continued
execution in fiscal 2015 on the Panda Liberty and Panda Patriot
projects contributed to record earnings during fiscal 2015. We
appreciate the dedicated efforts of our Gemma associates.”
About Argan, Inc.
Argan’s primary business is designing and building energy plants
through its Gemma Power Systems subsidiary. These energy
plants include single and combined cycle natural gas-fired power
plants as well as alternative energy facilities including
biodiesel, ethanol, and those powered by renewable energy sources
such as wind and solar. Argan also owns Southern Maryland
Cable, Inc.
Certain 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 Company’s ability to
achieve its business strategy while effectively managing costs and
expenses; (2) the Company’s ability to successfully and
profitably integrate acquisitions; and (3) the continued
strong performance of our power industry services business. 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
Argan’s filings with the Securities and Exchange Commission. In
addition, reference is hereby made to cautionary statements with
respect to risk factors set forth in the Company’s most recent
reports on Form 10-K and 10-Q, and other SEC filings.
ARGAN, INC. AND SUBSIDIARIES CONSOLIDATED
STATEMENTS OF OPERATIONS Three Months
Ended January 31, Years Ended January 31, 2015
2014 2015 2014
(Unaudited) REVENUES Power industry services
$ 100,774,000 $ 58,257,000 $ 376,676,000
$ 218,649,000 Telecommunications infrastructure services
1,551,000 1,234,000 6,434,000
8,806,000 Revenues 102,325,000
59,491,000 383,110,000 227,455,000
COST OF REVENUES Power industry services 79,469,000
37,745,000 294,643,000 141,807,000 Telecommunications
infrastructure services 1,181,000 1,059,000
4,864,000 6,800,000 Cost of revenues
80,650,000 38,804,000
299,507,000 148,607,000
GROSS PROFIT
21,675,000 20,687,000 83,603,000 78,848,000 Selling, general and
administrative expenses 6,137,000
4,329,000 19,470,000 12,918,000
INCOME FROM OPERATIONS 15,538,000 16,358,000 64,133,000
65,930,000 Gains on the deconsolidation of variable interest
entities -- -- -- 2,444,000 Other income, net 72,000
134,000 234,000 961,000
INCOME BEFORE INCOME TAXES 15,610,000 16,492,000 64,367,000
69,335,000 Income tax expense 5,734,000
6,460,000 20,912,000 25,991,000
NET
INCOME 9,876,000 10,032,000 43,455,000 43,344,000
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS
3,878,000
868,000
13,010,000
3,219,000
NET INCOME ATTRIBUTABLE TO THE
STOCKHOLDERS OF ARGAN, INC.
$ 5,998,000 $ 9,164,000 $ 30,445,000 $
40,125,000
EARNINGS PER SHARE ATTRIBUTABLE TO THE
STOCKHOLDERS OF ARGAN, INC.
Basic $ 0.41 $ 0.64 $ 2.11 $ 2.85 Diluted
$ 0.40 $ 0.63 $ 2.05 $ 2.78
WEIGHTED AVERAGE NUMBER OF SHARES
OUTSTANDING
Basic 14,561,000 14,219,000
14,433,000 14,072,000 Diluted
14,838,000 14,581,000 14,823,000
14,427,000
CASH DIVIDENDS PER COMMON SHARE
$ -- $ -- $ 0.70 $ 0.75
ARGAN, INC. AND SUBSIDIARIES RECONCILIATIONS TO EBITDA
(Unaudited) Consolidated Three Months Ended January
31, 2015 2014 Net income $ 9,876,000 $
10,032,000 Less net income - noncontrolling interests (3,878,000 )
(868,000 ) Interest expense 30,000 -- Income tax expense 5,699,000
6,460,000 Depreciation 129,000 141,000 Amortization of purchased
intangible assets 61,000 61,000
EBITDA attributable to the stockholders of
Argan, Inc.
$ 11,917,000 $ 15,826,000
Power Industry Services
Three Months Ended January 31, 2015
2014 Income before income taxes $ 17,486,000 $ 18,324,000
Less income before income taxes - noncontrolling interests
(3,913,000 ) (868,000 ) Interest expense 30,000 -- Depreciation
85,000 97,000 Amortization of purchased intangible assets
61,000 61,000 EBITDA attributable to the
stockholders of Argan, Inc. $ 13,749,000 $ 17,614,000
Consolidated
Years Ended January 31, 2015
2014 Net income $ 43,455,000 $ 43,344,000 Less net income -
noncontrolling interests (13,010,000 ) (3,219,000 ) Interest
expense 30,000 (161,000 ) Income tax expense 20,956,000 25,559,000
Depreciation 551,000 549,000 Amortization of purchased intangible
assets 243,000 243,000 EBITDA
attributable to the stockholders of Argan, Inc. $ 52,225,000
$ 66,315,000
Power Industry Services
Years Ended January 31, 2015
2014 Income before income taxes $ 70,334,000 $ 72,669,000
Less income before income taxes - noncontrolling interests
(12,966,000 ) (3,651,000 ) Interest expense 30,000 (161,000 )
Depreciation 372,000 366,000 Amortization of purchased intangible
assets 243,000 243,000 EBITDA
attributable to the stockholders of Argan, Inc. $ 58,013,000
$ 69,466,000
Management uses EBITDA, a non-GAAP financial measure, for
planning purposes, including the preparation of operating budgets
and to determine appropriate levels of operating and capital
investments. Management believes that EBITDA provides additional
insight for analysts and investors in evaluating the Company's
financial and operational performance and in assisting investors in
comparing the Company's financial performance to those of other
companies in the Company's industry. However, EBITDA is not
intended to be an alternative to financial measures prepared in
accordance with GAAP and should not be considered in isolation from
our GAAP results of operations. Pursuant to the requirements of SEC
Regulation G, a reconciliation between the Company's GAAP and
non-GAAP financial results is provided above and investors are
advised to carefully review and consider this information as well
as the GAAP financial results that are presented in the Company's
SEC filings.
ARGAN, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE
SHEETS JANUARY 31, 2015 2014
ASSETS
CURRENT ASSETS
Cash and cash equivalents $ 333,691,000 $ 272,209,000 Accounts
receivable, net of allowance for doubtful accounts 27,330,000
23,687,000 Costs and estimated earnings in excess of billings
455,000 527,000 Prepaid expenses 1,092,000 1,754,000 Notes
receivable and accrued interest 1,786,000 204,000 Deferred income
tax assets -- 178,000
TOTAL CURRENT
ASSETS 364,354,000 298,559,000
Property, plant and equipment, net of
accumulated depreciation (including $2,658,000 in costs related to
a variable interest entity as of January 31, 2015)
6,518,000 4,183,000 Goodwill 18,476,000 18,476,000 Intangible
assets, net of accumulated amortization 1,845,000
2,088,000
TOTAL ASSETS $ 391,193,000 $
323,306,000
LIABILITIES AND STOCKHOLDERS’
EQUITY CURRENT LIABILITIES Accounts payable $
37,691,000 $ 22,589,000 Accrued expenses 15,976,000 7,912,000
Billings in excess of costs and estimated earnings 161,564,000
134,736,000 Deferred income tax liabilities 201,000
--
TOTAL CURRENT LIABILITIES 215,432,000
165,237,000 Deferred income tax liabilities 809,000
292,000
TOTAL LIABILITIES 216,241,000
165,529,000
COMMITMENTS AND
CONTINGENCIES STOCKHOLDERS’ EQUITY
Preferred stock, par value $0.10 per share
– 500,000 shares authorized; no shares issued and outstanding
--
--
Common stock, par value $0.15 per share –
30,000,000 shares authorized; 14,634,434 and 14,289,134 shares
issued at January 31, 2015 and 2014, respectively; 14,631,201 and
14,285,901 shares outstanding at January 31, 2015 and 2014,
respectively
2,195,000
2,143,000
Additional paid-in capital 109,696,000 100,863,000 Retained
earnings 73,614,000 53,335,000 Treasury stock, at cost – 3,233
shares at January 31, 2015 and 2014 (33,000 ) (33,000
)
TOTAL STOCKHOLDERS’ EQUITY 185,472,000 156,308,000
Noncontrolling interests (10,520,000 ) 1,469,000
TOTAL EQUITY 174,952,000
157,777,000
TOTAL LIABILITIES AND EQUITY $
391,193,000 $ 323,306,000
Argan, Inc.Company Contact:Rainer Bosselmann,
301-315-0027orInvestor Relations Contact:Cynthia Flanders,
301-315-0027
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