Argan, Inc. (NYSE: AGX) today announced financial
results for its first quarter ended April 30, 2015.
First Quarter Highlights:
- Revenues of $85 million for our first
quarter compared to $51 million for last year’s first quarter.
- Net income attributable to our
stockholders of $7.5 million vs. $3.5 million for last year’s first
quarter.
- Diluted earnings per share of $0.50 vs.
$0.24 for the prior year quarter.
- Cash, cash equivalents and short-term
investments of $331 million at current quarter-end.
- EBITDA attributable to our stockholders
was $12.5 million, a 125% increase over the prior year
quarter.
Our strong and steady performance on two large gas-fired power
plant projects enhanced our operating results for the current
quarter. As a result, revenues of $85 million increased 67% over
the same period last year and our gross profit margin percentage
increased from 20% for the quarter ended April 30, 2014 to 25% for
the current quarter. Our subsidiary, Gemma Power Systems,
contributed 97% to total consolidated revenues and gross profit for
the current quarter.
Income from operations for the first quarter of the current year
was $15.6 million compared to income from operations of $6.7
million for the quarter ended April 30, 2014. SG&A remained
stable at approximately 7% of revenues for the quarters ended April
30, 2015 and 2014. Net income attributable to the stockholders of
Argan, Inc. for the first quarter was $7.5 million, or $0.50 per
diluted share, compared with $3.5 million, or $0.24 per diluted
share a year ago.
Consolidated EBITDA attributable to the stockholders of Argan,
Inc. was $12.5 million for the quarter ended April 30, 2015, a 125%
increase over the same period last year.
Contract backlog declined to $347 million as of April 30, 2015
from $423 million as of January 31, 2015, as progress continued on
the two Panda gas-fired power plant projects in Pennsylvania.
Commenting on Argan’s first quarter results, Rainer Bosselmann,
Chairman and Chief Executive Officer, stated, “Our ability to
increase revenues, while maintaining strong gross margins, is a
testament to our strength in execution. While the amount of our
booked business declined during the current quarter, we are seeing
a significant level of bids outstanding with both new and repeat
clients.”
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 CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
Three Months Ended April 30,
2015 2014 REVENUES Power
industry services $ 82,884,000 $ 49,824,000 Telecommunications
infrastructure services 2,604,000 1,367,000 Revenues
85,488,000 51,191,000
COST OF REVENUES Power
industry services 62,379,000 40,049,000 Telecommunications
infrastructure services 1,942,000 1,091,000 Cost of
revenues 64,321,000 41,140,000
GROSS PROFIT
21,167,000 10,051,000 Selling, general and administrative expenses
5,540,000 3,379,000
INCOME FROM OPERATIONS
15,627,000 6,672,000 Other income, net 85,000 22,000
INCOME BEFORE INCOME TAXES 15,712,000 6,694,000 Income tax
expense 4,861,000 1,894,000
NET INCOME
10,851,000 4,800,000
NET INCOME ATTRIBUTABLE TO
NONCONTROLLING INTERESTS
3,348,000 1,325,000
NET INCOME ATTRIBUTABLE TO THE
STOCKHOLDERS OF ARGAN, INC.
$ 7,503,000 $ 3,475,000
NET INCOME PER SHARE ATTRIBUTABLE TO
THE STOCKHOLDERS OF ARGAN, INC.
Basic $ 0.51 $ 0.24 Diluted $ 0.50 $ 0.24
WEIGHTED
AVERAGE NUMBER OF SHARES OUTSTANDING Basic 14,637,000
14,299,000 Diluted 14,864,000 14,683,000
ARGAN, INC. AND SUBSIDIARIES
RECONCILIATIONS TO EBITDA (Unaudited)
Consolidated Operations Three Months
Ended April 30, 2015 2014 Net
income, as reported $ 10,851,000 $ 4,800,000 Net income
attributable to noncontrolling interests (3,348,000 ) (1,325,000 )
Interest expense (68,000 ) -- Income tax expense 4,903,000
1,894,000 Depreciation 119,000 142,000 Amortization of purchased
intangible assets 60,000 60,000
EBITDA attributable to the stockholders of
Argan, Inc.
$ 12,517,000 $ 5,571,000
Power Industry Services
Three Months Ended April 30, 2015 2014
Income before income taxes $ 17,001,000 $ 8,009,000
Income before income taxes attributable to
noncontrolling interests
(3,306,000 ) (1,325,000 ) Interest expense (68,000 ) --
Depreciation 75,000 96,000 Amortization of purchased intangible
assets 60,000 60,000
EBITDA attributable to the stockholders of
Argan, Inc.
$ 13,762,000 $ 6,840,000
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 CONDENSED
CONSOLIDATED BALANCE SHEETS
April 30, 2015 January 31, 2015 ASSETS
(Unaudited) (Note 1) CURRENT ASSETS
Cash and cash equivalents $ 274,528,000 $ 333,691,000 Short-term
investments 56,017,000 -- Accounts receivable, net of allowance for
doubtful accounts 34,500,000 27,330,000 Costs and estimated
earnings in excess of billings 595,000 455,000 Notes receivable and
accrued interest 2,025,000 1,786,000 Prepaid expenses and other
current assets 4,340,000 1,092,000
TOTAL CURRENT ASSETS 372,005,000 364,354,000 Property, plant
and equipment, net of accumulated depreciation 7,606,000 6,518,000
Goodwill 18,476,000 18,476,000 Intangible assets, net of
accumulated amortization 1,785,000 1,845,000
TOTAL ASSETS $ 399,872,000 $ 391,193,000
LIABILITIES AND EQUITY CURRENT
LIABILITIES Accounts payable $ 29,914,000 $ 37,691,000 Accrued
expenses 19,061,000 15,976,000 Billings in excess of costs and
estimated earnings 162,973,000 161,564,000 Deferred income tax
liabilities 462,000 201,000
TOTAL
CURRENT LIABILITIES 212,410,000 215,432,000 Deferred income tax
liabilities 419,000 809,000
TOTAL
LIABILITIES 212,829,000 216,241,000
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; 14,672,184 and 14,634,434 shares
issued at April 30 and January 31, 2015, respectively; 14,668,951
and 14,631,201 shares outstanding at April 30 and January 31, 2015,
respectively
2,201,000
2,195,000
Additional paid-in capital 110,930,000 109,696,000 Retained
earnings 81,117,000 73,614,000 Treasury stock, at cost – 3,233
shares at April 30 and January 31, 2015 (33,000 )
(33,000 )
TOTAL STOCKHOLDERS’ EQUITY 194,215,000 185,472,000
Noncontrolling interests (7,172,000 ) (10,520,000 )
TOTAL EQUITY 187,043,000 174,952,000
TOTAL LIABILITIES AND EQUITY $ 399,872,000 $
391,193,000
Note 1 – The condensed consolidated
balance sheet as of January 31, 2015 has been derived from audited
consolidated financial statements.
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version on businesswire.com: http://www.businesswire.com/news/home/20150608005197/en/
Argan, Inc.Company Contact:Rainer Bosselmann,
301-315-0027orInvestor Relations Contact:Cynthia Flanders,
301-315-0027
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