Furmanite Corporation (NYSE: FRM) today reported results for the quarter ended September 30, 2012. Revenues were $75.6 million, compared with a record $78.3 million for the third quarter of 2011. Unfavorable currency effects accounted for $1.3 million of the revenue decrease, but had minimal effect on operating income. The operating loss for the quarter, including $0.2 million of restructuring and corporate headquarters relocation costs, was $0.7 million. Net loss for the quarter was $1.3 million, or $0.03 per diluted share.
“Our earnings for this quarter were poor by any standard, but especially when compared to the excellent third quarter performance last year. While revenue results were close to expectations, this quarter’s reported earnings reflected something of a perfect storm. Many negative issues impacted our earnings, including Gulf Coast weather, project margin shortfalls, a portion of the European restructuring, restructuring related indirect costs and inefficiencies, acquisition timing and assimilation, deferred projects, bad debt provisions, and the final headquarters relocation expense,” said Charles R. Cox, Chairman and CEO of Furmanite Corporation. “Thankfully, we do not anticipate this kind of negative confluence going forward.”
Joseph Milliron, Furmanite President and COO, said, “While this has been an exciting year of transition, change and preparation for the future, we have certainly encountered far more unforeseen short-term issues than expected. In spite of these issues, we are successfully creating our new global organization and making many improvements which will prepare us to grow and execute better than ever before.” Mr. Milliron continued, “We responded immediately to the worsening European economic crisis reality which we encountered early this year, but were not quite able to fully finalize the restructuring costs during this quarter as anticipated. We now expect the remaining $1.9 million of restructuring costs to be absorbed in fourth quarter results.”
ABOUT FURMANITE CORPORATIONFurmanite 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 70 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.
|CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS|
| (in thousands, except per share data)
|For the Three Months||For the Nine Months|
|Ended September 30,||Ended September 30,|
|Costs and expenses:|
|Depreciation and amortization expense||2,329||2,207||6,318||6,280|
|Selling, general and administrative expense||17,725||16,794||56,716||51,484|
|Total costs and expenses||76,307||72,808||229,965||218,439|
|Operating income (loss)||(728||)||5,522||3,324||15,954|
| Interest income and other income
|Income (loss) before income taxes||(1,037||)||4,918||2,217||15,097|
|Income tax expense||(243||)||(1,336||)||(2,483||)||(2,343||)|
|Net income (loss)||$||(1,280||)||$||3,582||$||(266||)||$||12,754|
|Earnings (loss) per common share - Basic||$||(0.03||)||$||0.10||$||(0.01||)||$||0.34|
|Earnings (loss) per common share - Diluted||$||(0.03||)||$||0.10||$||(0.01||)||$||0.34|
Weighted average number of common and common equivalent shares used incomputing earnings (loss) per common share:
|CONDENSED CONSOLIDATED BALANCE SHEETS|
|September 30,||December 31,|
|Trade receivables, net||71,548||71,508|
|Other current assets||11,521||13,171|
|Total current assets||150,992||145,760|
|Property and equipment, net||39,650||34,060|
|Total current liabilities||$||46,427||$||41,999|
|Total long-term debt||39,328||31,051|
|Total stockholders' equity||121,390||118,889|
|Total liabilities and stockholders' equity||$||223,171||$||207,232|
|CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS|
| For the Nine Months Ended
|Net income (loss)||$||(266||)||$||12,754|
|Depreciation, amortization and other non-cash items||10,200||6,238|
|Working capital changes||256||(13,364||)|
|Net cash provided by operating activities||10,190||5,628|
|Acquisitions of assets and business, net of cash acquired||(11,700||)||(3,815||)|
|Proceeds from sale of assets||121||131|
|Proceeds from issuance of debt||39,300||–|
|Payments on debt||(32,720||)||(85||)|
|Debt issuance costs||(595||)||–|
|Issuance of common stock||537||271|
|Effect of exchange rate changes on cash||177||(287||)|
|Decrease in cash and cash equivalents||(798||)||(2,072||)|
|Cash and cash equivalents at beginning of period||34,524||37,170|
|Cash and cash equivalents at end of period||$||33,726||$||35,098|
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