Insituform Technologies, Inc. (Nasdaq Global Select Market: INSU) revised its 2011 outlook for diluted earnings per share to $0.90-$1.00 (non-GAAP), excluding acquisition-related transaction expenses and restructuring charges associated with a company-wide cost reduction program.
Joe Burgess, President and Chief Executive Officer, stated, “2011 continues to be a very challenging year for our sewer contracting businesses in the United States and India. We also have been hampered this year by delays in the release and the loss of certain projects in our coatings businesses. However, these challenges do not diminish the opportunities we expect for our entire company as we focus on 2012.”
The North American Sewer Rehabilitation business continued to be hard hit in the third quarter because of project delays and smaller projects, both in diameter and transaction size, despite an improving bid table and better discipline in the organization. “Given current market conditions and lower than expected performance, we have taken actions to realign our North American Sewer Rehabilitation organization further so it can operate much more profitably in this environment. We have reduced the number of work crews, completed unprofitable work acquired earlier in the year, implemented improved bidding discipline, reduced overhead costs and removed underperforming management while also selectively adding personnel to focus on improved project management and logistics to achieve increased and sustainable margins in our contracting business. While market conditions have remained challenging, recent project acquisitions have been at higher margins compared to earlier in the year giving us confidence for improved performance in the fourth quarter and next year,” said Burgess.
The Company also has continued to experience delays in getting the release of new projects in India, which were anticipated to be awarded in 2011. These project delays not only impact the contracting business but also manufacturing operations. Those projects are still expected to begin in early 2012, slipping from the fourth quarter of 2011.