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LOMBARD, Ill., April 1, 2014 (GLOBE NEWSWIRE) -- Pernix Group, Inc. (OTCQB:PRXG) announced its financial results today for the fiscal year ended December 31, 2013.
Pernix Group reported the second highest revenue in its history, with consolidated revenue from continuing operations of $73.8 million in 2013, as compared to $120.0 million in 2012. The decrease in revenue was primarily attributable to the successful completion or wind down of two large construction projects for the U.S. government. The decrease in construction-related revenues was partially offset by a $0.7 million increase in power generating revenue, which reflects higher usage of diesel power at the Company's power plants in Fiji, as opposed to hydro-electric power, due to climatic conditions and maintenance of hydro facilities in Fiji.
Gross profit from continuing operations was $7.2 million in 2013, as compared to $14.8 million in 2012, driven by the aforementioned decline in revenue in our construction segment. This decline was partially offset by higher revenue and gross margin in the power generating segment, resulting from both higher demand for our power in Fiji and lower maintenance costs. Consolidated operating expenses decreased by $1.0 million, reflecting better absorption of overhead costs in our construction projects that more than offset higher compensation expenses associated with additional resources in our power and construction business development and execution functions. As a result of these factors, operating income (before minority interest) declined to $2.0 million in 2013 from $8.7 million in 2012; after taking into consideration minority interest, operating income was $0.4 million this year, as compared to $2.9 million last year.
Pernix Group's consolidated net income from continuing operations attributable to common shareholders decreased to ($4.7 million) from $0.4 million. The net loss in 2013 was due primarily to management's decision at the end of the third quarter to increase the valuation allowance on its deferred tax assets by $4.9 million. As a result of the increase in valuation allowance, all of the Company's deferred tax assets are now fully reserved, and all future taxable income would be expected to have a dollar-for-dollar additive impact to stockholders' equity. The increase in valuation allowance is a non-cash expense and has no impact on the Company's liquidity, cash flows or its ability to execute projects or conduct ongoing operations.