Matrix Servic Q3 2010 Earnings Call Transcript
This morning, we announced our earnings for the quarter, excluding non-routine charges, of $0.10 per fully diluted share which were below our expectations. The primary driver impacting our third quarter results the much lower volume of recurring repair and maintenance activity than we had expected. As stated in our April 23 press release, we had anticipated that business activity would pick up in the second half of the fiscal year. While earnings for the first half of fiscal 2010 were in line with our plan, our clients are still experiencing a challenging economic environment which had resulted in continued delays of capital projects and lower repair and maintenance spending. We see this continued into the fourth quarter which coupled with a very competitive environment, has resulted in a reduction to our EPS guidance for the fiscal year to $0.55 to $0.65 per fully diluted share.
This guidance excludes the impact of non-routine charges related to acquired claim receivables and other legal matters. Having said that though, we remain confident in our long-term strategy and believe our strong balance sheet has positioned the company to grow as our markets improve. As I will discuss in a few minutes, we are seeing more encouraging signs as we move into our fiscal 2011.
Additionally, as we announced in the April 23 press release, we continue to manage the company's cost structure in response to the challenging economic environment. In addition to previously reduced administrative costs at $6 million per year, the company took difficult but necessary actions during the third quarter to further reduce overhead costs. We expect the third quarter cost reductions to total $6 million annually. Our plan going forward is to maintain an appropriate cost structure and level of talent to ensure we execute our projects safely and effectively and allow us to grow and expand our business both domestically and internationally.
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