Aegion Corporation (Nasdaq Global Select Market: AEGN) expects diluted earnings per share for the first quarter of 2013 to be in the range of $0.04 to $0.08, below previous expectations as a result of project delays associated with adverse weather conditions in the quarter as well as customer directed delays for several scheduled contracts for the Energy & Mining and Commercial & Structural platforms. These transitional issues impacting the first quarter do not alter full year expectations for diluted earnings per share in the range of $1.60 to $1.80. J. Joseph Burgess, President and Chief Executive Officer, commented, “Historically, the first quarter represents the smallest in our earnings cycle, approximately 10 percent of total earnings for the year, because of the increased probability of delays caused by weather and the seasonal low period for many of our businesses. Because of this, project timing can have a disproportionate impact on earnings per share in the first quarter and that’s been the case this year. We are confident in our ability to recover during the remainder of 2013 from this unusually slow start as the outlook for the markets we serve across all the three platforms remains favorable.” Severe weather during the entire quarter affected parts of Canada as well as the Midwest and Eastern United States resulting in delays for contracting and manufacturing activities associated with the North America Water & Wastewater business and in completing projects for the Commercial & Structural platform. In addition, several domestic and international contracts for Energy & Mining and Commercial & Structural expected to begin or be completed by the end of March have now been pushed further into the calendar year. A contributing factor for the lower than anticipated earnings in the quarter was an unexpected slowdown in the pace of pipeline construction by the prime contractor for the Tite Liner ® project in Morocco during the month of March. This does not impact the original schedule for completing the lining work this summer. In the Canadian Oil Sands, soft ground conditions have delayed overall pipeline construction activity impacting the schedule in the first quarter for Bayou’s pipe coating projects. Mr. Burgess continued, “We’ve thoroughly reassessed the outlook for the remainder of 2013 across all of our businesses based on the visibility we have for the backlog at this time. We remain committed to our guidance for diluted earnings per share in the range of $1.60 to $1.80, with cash flow from operating activities in excess of $100 million, and return on invested capital in the range of 9 percent to 10 percent. Our confidence for maintaining this growth outlook comes from the record size and diverse composition of our backlog at the start of 2013, a robust bid table supporting the opportunity for securing additional projects this year, and a revised risk adjustment analysis for the timing of key projects in our current backlog. All of these factors justify the broad range for our diluted earnings per share guidance and acknowledges the expectations for greater earnings contributions in the second half of 2013.”
Aegion Corporation is a global leader in infrastructure protection, providing proprietary technologies and services to protect against the corrosion of industrial pipelines and for the rehabilitation and strengthening of water, wastewater, energy and mining piping systems and buildings, bridges, tunnels and waterfront structures. More information about Aegion can be found on our internet site at http://www.aegion.com .Forward-Looking Statements The Private Securities Litigation Reform Act of 1995 provides a “safe harbor” for forward looking statements. We make forward-looking statements in this news release that represent our beliefs or expectations about future events or financial performance. These forward-looking statements are based on information currently available to us and on management’s beliefs, assumptions, estimates or projections and are not guarantees of future events or results. When used in this document, the words “anticipate,” “estimate,” “believe,” “plan,” “intend, “may,” “will” and similar expressions are intended to identify forward-looking statements, but are not the exclusive means of identifying such statements. Such statements are subject to known and unknown risks, uncertainties and assumptions, including those referred to in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2012, as filed with the Securities and Exchange Commission on February 27, 2013. In light of these risks, uncertainties and assumptions, the forward-looking events may not occur. In addition, our actual results may vary materially from those anticipated, estimated, suggested or projected. Except as required by law, we do not assume a duty to update forward-looking statements, whether as a result of new information, future events or otherwise. Investors should, however, review additional disclosures made by us from time to time in our periodic filings with the Securities and Exchange Commission. Please use caution and do not place reliance on forward-looking statements. All forward-looking statements made by us in this news release are qualified by these cautionary statements.
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