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ENGlobal Reports Third Quarter Results

HOUSTON, Nov. 4, 2010 (GLOBE NEWSWIRE) -- ENGlobal (Nasdaq:ENG), a leading provider of energy-related project delivery solutions, announced today its financial results for the third quarter ended September 30, 2010.

Third Quarter 2010 Highlights Compared to Third Quarter 2009:

  • $(0.19) earnings per diluted share, a decrease from $0.00, with $(0.03) per share from operations and $(0.16) per share from a pre-tax charge
  • Revenue of $85.8 million, a decrease of 1.7%
  • Consolidated gross profit margin as a percentage of revenue of 7.5%, a decrease from 8.2%
  • Positive cash flow from operations of $2.2 million for the nine months ended September 30, 2010
  • 31.6% increase in long-term debt

ENGlobal reported third quarter net loss of $5.2 million, or $(0.19) earnings per diluted share, for the quarter ended September 30, 2010, a decrease from a net loss of $0.1 million, or $0.00 for the quarter ended September 30, 2009. The Company's third quarter operating results include a pre-tax charge of $7.2 million related to uncollectable note receivable from a bankrupt client, South Louisiana Ethanol ("SLE").

Management's Assessment:

Commenting on the results, ENGlobal's President and Chief Executive Officer, Edward L. Pagano said, "Although ENGlobal's financial results are disappointing, we are pleased to announce that ENGlobal showed net income in September 2010 for the first time since July 2009. We continue to see improvements across several of our operational metrics, such as bi-weekly billable man hours and utilization, when compared to the second quarter 2010. These metrics improved during each month of the quarter. We remain cautiously optimistic about business trends heading into the fourth quarter, which is seasonally our weakest due to vacations and holidays."

The SLE dispute involved a project relating to the retro-fit of an ethanol plant in southern Louisiana. ENGlobal provided engineering services on a lump sum basis and procurement and construction services on a cost reimbursable basis. In August 2009, SLE filed for Bankruptcy protection. The Bankruptcy court in Louisiana recently ruled on the distribution of assets in the event of a future sale or liquidation of the ethanol facility's assets that was significantly lower than the Company's previous estimate. ENGlobal has adjusted the note receivable accordingly.

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