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Layne Christensen Reports Fiscal 2013 Fourth Quarter And Year-End Results Of Operations

  • Results of operations for FY Q4 2013 were slightly better than preliminary results issued in March 2013:
  • Revenues of $229.7 million.  
  • Net loss from continuing operations of $22.1 million, or $1.13 per share, which included non-cash impairment charges (net of income taxes) of $4.4 million, or $0.23 per share, related to an assessment of the value of certain product lines and assets no longer considered strategic.
  • Heavy Civil Division on track to return to profitability no later than mid-FY2014.  
  • Mineral Exploration Division expected to return to profitability in Q1 FY2014.  
  • Cash and cash equivalents were $27.2 million, long-term debt was $96.5 million, and stockholders' equity was $412.7 million ($20.82 per share) as of January 31, 2013.
 
Financial Data Three Months   Twelve Months  
(000's, except per share data) Jan 31, 2013 Jan 31, 2012 %Change Jan 31, 2013 Jan 31, 2012 %Change
Revenues            
Water Resources  $ 64,947  $ 67,460 (3.7)  $ 278,529  $ 274,556 1.4
Inliner  31,574  34,501 (8.5)  133,256  132,108 0.9
Heavy Civil  58,408  78,525 (25.6)  278,131  343,760 (19.1)
Geoconstruction  29,039  25,011 16.1  133,247  89,210 49.4
--Water Infrastructure Group  183,968  205,497 (10.5)  823,163  839,634 (2.0)
--Mineral Exploration  44,328  65,036 (31.8)  246,582  268,909 (8.3)
--Other  1,446  1,391 4.0  5,879  4,215 39.5
Total revenues  229,742  271,924 (15.5)  1,075,624  1,112,758 (3.3)
Net loss from continuing operations attributable to Layne Christensen Company  (22,134)  (87,507) (74.7)  (11,575)  (56,022) (79.3)
Diluted EPS - continuing operations  (1.13)  (4.50) (74.9)  (0.59)  (2.88) (79.5)
Net income (loss) from continuing operations excluding impairment charges and loss on remeasurement of equity investment  (17,777)  (3,438) 417.1  931  28,047 (96.7)
Diluted EPS - continuing operations excluding impairment charges and loss on remeasurement of equity investment  (0.91)  (0.18) 405.6  0.05  1.44 (96.5)
             
 
Reconciliation to non-GAAP Financial Data Three Months % Twelve Months %
(000's, except per share data) Jan 31, 2013 Jan 31, 2012 Change Jan 31, 2013 Jan 31, 2012 Change
Net income (loss) from continuing operations attributable to Layne Christensen Company  $ (22,134)  $ (87,507) (74.7)  $ (11,575)  $ (56,022) (79.3)
Loss on remeasurement of equity method investment   -  -    7,705  -  
Impairment charges   7,292  96,579    8,431  96,579  
Income tax benefit of impairment charges   (2,935)  (12,510)    (3,630)  (12,510)  
Layne Christensen Company excluding loss on remeasurement of equity investment and impairment charges *  $ (17,777)  $ (3,438) 417.1  $ 931  $ 28,047 (96.7)
Diluted EPS - continuing operations excluding loss on remeasurement of equity investment and impairment charges *  $ (0.91)  $ (0.18) 405.6  $ 0.05  $ 1.44 (96.5)
* Management believes the exclusion of these items provides a useful basis for evaluating underlying business performance, but they should not be considered in isolation and are not in accordance with, or a substitute for, evaluating business performance utilizing GAAP financial information.

"Our performance in Q4 FY2013 was slightly better than the forecast we issued in March 2013. With the exception of Inliner, each of our divisions reported quarterly losses and we incurred non-cash charges and non-recurring expenses associated with various aspects of our growth and operating evolution. We expect Layne's overall profitability will be impacted in FY2014 by temporary weakness at Geoconstruction, continuing investments in our Energy Services Division and higher corporate overhead costs due to our strategic move to The Woodlands, Texas. We expect Heavy Civil to return to profitability by mid-calendar 2013, driven by our progress in working through older projects that do not meet our profitability expectations, securing new projects with higher associated margins and cost savings associated with headcount reductions and other measures at this division. The vast majority of Heavy Civil's current backlog, which is higher than a year ago, reflects projects we expect to complete at improved margins during FY2014 and beyond. Mineral Exploration should return to profitability in Q1 FY2014, albeit at a lower level than last year. For the year, we believe that exploration programs will continue, but at a slower pace due to the global mining expenditure slowdown and, in some cases, as mining companies work through the integration of large acquisitions. We now believe that this market may be soft for most of FY2014, but could begin to improve in the latter half of this fiscal year as long as gold and copper prices remain stable. Our Energy Services Division remains a key part of our strategy and we expect to announce new contracts and business initiatives in the coming months. We remain focused on new business development across our divisions and are confident in our ability to successfully execute our strategies and perform to our expectations."

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