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TheStreet Open House

Furmanite Corporation Reports First Quarter 2012 Results

Stocks in this article: FRM

Furmanite Corporation (NYSE: FRM) today reported results for the quarter ended March 31, 2012. Revenues were $71.8 million compared with $73.1 million for the first quarter of 2011. Net loss incurred in the first quarter of 2012 was $0.8 million compared to net income of $4.0 million, inclusive of an acquisition related income tax benefit of $1.2 million, in the first quarter of 2011.

Foreign currency fluctuations unfavorably impacted the Company’s first quarter 2012 revenues by $0.3 million but had minimal impact on operating results for the quarter. Loss per share was $0.02 for the first quarter of 2012. This compares with first quarter 2011 earnings per share (diluted) of $0.11, or $0.08 excluding the acquisition related income tax benefit in the quarter.

“Our overall results this quarter were seriously impacted by deteriorating market conditions in Europe,” said Charles R. Cox, chairman and CEO of Furmanite Corporation. “The markets in both Asia-Pacific and the Americas continue strong with our units in these regions continuing to perform well, in spite of a late start to a number of turnarounds.”

Joseph Milliron, Furmanite President and COO, said: “The major restructuring we completed in 2010 proved inadequate for the poor markets we encountered this quarter. In light of the continuing negative and uncertain macro outlook for Europe, we have already begun plans for further restructuring there. After the cost of that action, we are optimistic that the impact of further weakness in European markets in future quarters will be significantly reduced.”

Mr. Cox continued, “We remain confident we are on the right course to drive and support sustained long-term growth. Although this has been a disappointing quarter, we are moving ahead quickly with our previously announced strategic and organizational initiatives.”

ABOUT FURMANITE CORPORATION

Furmanite Corporation (NYSE: FRM) is a worldwide technical services firm. Headquartered in Houston, Texas, Furmanite, one of the world’s largest specialty technical services companies, delivers a broad portfolio of engineering solutions that keep facilities operating, minimizing downtime and maximizing profitability. Furmanite’s diverse, global operations serve a broad array of industry sectors, including offshore drilling operations, pipelines, refineries and power generation facilities, chemical and petrochemical plants, steel mills, automotive manufacturers, pulp and paper mills, food and beverage processing plants, semi-conductor manufacturers and pharmaceutical manufacturers. Furmanite operates more than 75 offices on six continents. For more information, visit www.furmanite.com.

Certain of the Company’s statements in this press release are not purely historical, and as such are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements regarding management’s intentions, plans, beliefs, expectations or projections of the future. Forward-looking statements involve risks and uncertainties, including without limitation, the various risks inherent in the Company’s business, and other risks and uncertainties detailed from time to time in the Company’s periodic reports filed with the Securities and Exchange Commission. One or more of these factors could affect the Company’s business and financial results in future periods, and could cause actual results to differ materially from plans and projections. There can be no assurance that the forward-looking statements made in this document will prove to be accurate, and issuance of such forward-looking statements should not be regarded as a representation by the Company, or any other person, that the objectives and plans of the Company will be achieved. All forward-looking statements made in this press release are based on information presently available to management, and the Company assumes no obligation to update any forward-looking statements.

FURMANITE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share data)
(Unaudited)
 
  For the Three Months
Ended March 31,
2012   2011
 
Revenues $ 71,782 $ 73,054
 
Costs and expenses:
Operating costs 52,352 50,443
Depreciation and amortization expense 2,025 1,875
Selling, general and administrative expense   18,156     16,911  
Total costs and expenses   72,533     69,229  
 
Operating income (loss) (751 ) 3,825
 
Interest income and other income (expense), net (128 ) 122
 
Interest expense   (401 )   (240 )
 
Income (loss) before income taxes (1,280 ) 3,707
 
Income tax benefit   450     319  
 
Net income (loss) $ (830 ) $ 4,026  
 
Earnings (loss) per common share - Basic $ (0.02 ) $ 0.11  
Earnings (loss) per common share - Diluted $ (0.02 ) $ 0.11  
FURMANITE CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
 
  (Unaudited)  
March 31, December 31,
2012 2011
 
Cash $

29,517

$ 34,524
Trade receivables, net 71,626 71,508
Inventories 29,342 26,557
Other current assets   13,409   13,171
Total current assets 143,894 145,760
 
Property and equipment, net 34,590 34,060
Other assets   27,703   27,412
Total assets $ 206,187 $ 207,232
 
Total current liabilities $ 40,294 $ 41,999
Total long-term debt 30,055 31,051
Other liabilities 15,743 15,293
Total stockholders' equity   120,095   118,889
Total liabilities and stockholders' equity $ 206,187 $ 207,232
FURMANITE CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(Unaudited)
 
For the Three Months Ended

March 31,

2012   2011
 
Net income (loss) $ (830 ) $ 4,026
 
Depreciation, amortization and other non-cash items 2,575 1,190
Working capital changes   (2,273 )   (5,241 )
Net cash used in operating activities (528 ) (25 )
 
Capital expenditures (2,040 ) (759 )
Acquisition of assets and business, net of cash acquired (3,921 )
Proceeds from sale of assets 11 32
Payments on debt (32,707 ) (35 )
Proceeds from issuance of debt 30,000
Debt issuance costs (575 )
Issuance of common stock 416
Effect of exchange rate changes on cash   416     659  
Decrease in cash and cash equivalents (5,007 ) (4,049 )
Cash and cash equivalents at beginning of period   34,524     37,170  
Cash and cash equivalents at end of period $ 29,517   $ 33,121  




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