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Integrated Electrical Services Reports Improved Fiscal 2013 Fourth Quarter and Year-End Results



Integrated Electrical Services Reports Improved Fiscal 2013 Fourth Quarter and
Year-End Results

HOUSTON, Dec. 17, 2013 (GLOBE NEWSWIRE) -- Integrated Electrical Services,
Inc. (or "IES") (Nasdaq:IESC) today announced financial results for its fiscal
2013 fourth quarter and year ended September 30, 2013. The results include the
acquisition of MISCOR Group, Ltd. ("MISCOR") completed on September 13, 2013.
MISCOR provides electrical and mechanical solutions to the industrial and rail
industries both in the United States and abroad and will comprise IES'
newly-created Infrastructure Solutions segment. With the acquisition of
MISCOR, IES now owns and manages a more diverse group of operating
subsidiaries comprised of four principal business segments: Communications,
Residential, Commercial & Industrial, and Infrastructure Solutions.

FOURTH QUARTER AND FISCAL YEAR 2013 FINANCIAL HIGHLIGHTS

  * Revenue of $123.8 million for the fourth quarter of 2013, an increase of
    0.3% compared with the fourth quarter of 2012, and revenue of $494.6
    million for fiscal year 2013, an increase of 8.4% compared with fiscal
    year 2012
     
  * Operating cash flow of $2.0 million for fiscal year 2013, an increase of
    $9.3 million from fiscal year 2012
     
  * Net loss per share from continuing operations of ($0.07) per share for the
    fourth quarter of 2013, and net loss per share from continuing operations
    of ($0.15) per share for the fiscal year 2013
     
  * Adjusted earnings per share from continuing operations of $0.03 per share
    for the fourth quarter of 2013, and adjusted earnings per share from
    continuing operations of $0.23 per share for the fiscal year 2013
     
  * Adjusted EBITDA of $1.5 million for the fourth quarter of 2013, an
    increase of $0.4 million compared with the fourth quarter of 2012, and
    Adjusted EBITDA of $8.0 million for fiscal year 2013, an increase of $3.6
    million from fiscal year 2012

MANAGEMENT COMMENTARY

James Lindstrom, Chairman and Chief Executive Officer stated, "2013 was a
solid year for IES, with improved margins, cash flow and earnings. Although
our overall net income results were negative on a GAAP basis, our operating
cash flow was positive and we achieved many of our internal financial and
strategic goals that fundamentally strengthened the intrinsic value of our
business. To that end, we completed a key acquisition, upgraded our credit
profile through two refinancings and the release of restricted cash by our
lender, achieved solid overall project execution and increased investment in
our workforce. We have started fiscal 2014 with gradually improving dynamics,
backlog and bid margins in more of our markets. We look forward to building
upon these improving dynamics and further enhancing the value of IES through
selective investments and acquisitions."

Robert Lewey, IES' Chief Financial Officer, added, "During the fourth quarter
of 2013, we improved profitability in many of our commercial, industrial and
single and multi-family residential locations, and expanded operating margins
in our Communications segment. Unfortunately, our fourth quarter results were
impacted by $2.2 million of project cost overruns on five large commercial
projects at two of our locations, including a significant project that
commenced in 2009 and is scheduled to be completed in 2015. We believe that we
have taken appropriate actions where applicable to mitigate future risk and
are not experiencing this level of project overruns elsewhere within our
Commercial & Industrial division."

NET OPERATING LOSS (NOL)

The Company estimates that it has available NOL carryforwards for U.S. federal
income tax purposes of approximately $466 million at September 30, 2013. The
Company's common stock is subject to a Rights Plan dated January 28, 2013
intended to assist in limiting the number of 5% or more owners and thus reduce
the risk of a possible "change of ownership" under Section 382 of the Internal
Revenue Code. Any such "change of ownership" under these rules would limit or
eliminate the ability of the Company to use its existing NOLs for federal
income tax purposes. There is no guaranty, however, that the Rights Plan will
achieve the objective of preserving the value or realization of the NOLs.

NON-GAAP FINANCIAL MEASURES AND OTHER ADJUSTMENTS

This press release includes certain financial measures that are not calculated
in accordance with generally accepted accounting principles in the U.S.
("GAAP"). Management believes that these measures provide useful information
to our investors by reflecting additional ways to view aspects of the
Company's operations that, when reconciled to the corresponding GAAP measures,
help our investors to better identify underlying trends in our business and
facilitate easier comparisons of our financial performance with prior and
future periods and to our peers. Non-GAAP financial measures should not be
considered in isolation from, or as a substitute for, financial information
calculated in accordance with GAAP. Investors are encouraged to review the
reconciliation of these non-GAAP measures to their most directly comparable
GAAP financial measures. A reconciliation of the non-GAAP financial measures
presented above to GAAP results has been provided in the financial tables
included in this press release.

For further details on the Company's financial results, please refer to the
Company's annual report on Form 10-K for the fiscal year ended September 30,
2013, to be filed with the Securities and Exchange Commission by December 17,
2013.

ABOUT INTEGRATED ELECTRICAL SERVICES, INC.

Integrated Electrical Services, Inc. is a holding company that, with the
completion of the MISCOR acquisition, owns and manages diverse operating
subsidiaries, comprised of providers of industrial products and infrastructure
services to a variety of end markets. Our 2,700 employees serve clients in the
United States and abroad. For more information about IES, please visit
www.ies-corporate.com.

Certain statements in this release are "forward-looking statements" within the
meaning of Section 27A of the Securities Act of 1933 and Section 21E of the
Securities Exchange Act of 1934, all of which are based upon various estimates
and assumptions that the Company believes to be reasonable as of the date
hereof. In some cases, you can identify forward-looking statements by
terminology such as "may," "will," "could," "should," "expect," "plan,"
"project," "intend," "anticipate," "believe," "seek," "estimate," "predict,"
"potential," "pursue," "target," "continue," the negative of such terms or
other comparable terminology. These statements involve risks and uncertainties
that could cause the Company's actual future outcomes to differ materially
from those set forth in such statements. Such risks and uncertainties include,
but are not limited to, the ability of our controlling shareholder to take
action not aligned with other shareholders; the sale or disposition of the
shares of our common stock held by our majority shareholder, which, under
certain circumstances, would trigger change of control provisions in our
severance plan or financing and surety arrangements; the possibility that
certain tax benefits of our net operating losses may be restricted or reduced
in a change in ownership; limitations on the availability of sufficient credit
or cash flow to fund our working capital needs, capital expenditures and debt
service; difficulty in fulfilling the covenant terms of our credit facilities;
competition in our respective industries, both from third parties and former
employees, which could result in the loss of one or more customers or lead to
lower margins on new projects; the inability to achieve, or difficulties and
delays in achieving potential benefits of the acquisition of MISCOR Group,
Ltd.; challenges integrating other new businesses into the Company or new
types of work, products or processes into our divisions; fluctuations in
operating activity due to downturns in levels of construction, seasonality and
differing regional economic conditions; a general reduction in the demand for
our services; a change in the mix of our customers, contracts and business;
our ability to successfully manage projects; possibility of errors when
estimating revenue and progress to date on percentage-of-completion contracts;
additional closures or sales of facilities could result in significant future
charges and a significant disruption of our operations; inaccurate estimates
used when entering into fixed-priced contracts; the cost and availability of
qualified labor; increased cost of surety bonds affecting margins on work and
the potential for our surety providers to refuse bonding or require additional
collateral at their discretion; increases in bad debt expense and days sales
outstanding due to liquidity problems faced by our customers; the recognition
of potential goodwill, long-lived assets and other investment impairments;
credit and capital market conditions, including changes in interest rates that
affect the cost of construction financing and mortgages, and the inability for
some of our customers to retain sufficient financing which could lead to
project delays or cancellations; accidents resulting from the physical hazards
associated with our work and the potential for accidents; our ability to pass
along increases in the cost of commodities used in our business, in
particular, copper, aluminum, steel, fuel and certain plastics; potential
supply chain disruptions due to credit or liquidity problems faced by our
suppliers; loss of key personnel and effective transition of new management;
success in transferring, renewing and obtaining electrical and construction
licenses; uncertainties inherent in estimating future operating results,
including revenues, operating income or cash flow; disagreements with taxing
authorities with regard to tax positions we have adopted; the recognition of
tax benefits related to uncertain tax positions; complications associated with
the incorporation of new accounting, control and operating procedures; the
financial impact of new or proposed accounting regulations; the effect of
litigation, claims and contingencies, including warranty losses, damages or
other latent defect claims in excess of our existing reserves and accruals;
warranty losses or other unexpected liabilities stemming from former divisions
which we have sold or closed; growth in latent defect litigation in states
where we provide residential electrical work for home builders not otherwise
covered by insurance; changes in the assumptions made regarding future events
used to value our stock options and performance-based stock awards; the
ability of IES to enter into, and the terms of, future contracts; the
inability to carry out plans and strategies as expected; future capital
expenditures and refurbishment, repair and upgrade costs; delays in
refurbishment and upgrade projects; and liabilities under laws and regulations
protecting the environment.

You should understand that the foregoing, as well as other risk factors
discussed in this document and in the Company's annual report on Form 10-K for
the year ended September 30, 2013, could cause future outcomes to differ
materially from those expressed in such forward-looking statements. The
Company undertakes no obligation to publicly update or revise any information,
including information concerning its controlling shareholder, net operating
losses, borrowing availability, or cash position, or any forward-looking
statements to reflect events or circumstances that may arise after the date of
this release.

Forward-looking statements are provided in this press release pursuant to the
safe harbor established under the private Securities Litigation Reform Act of
1995 and should be evaluated in the context of the estimates, assumptions,
uncertainties, and risks described herein.

General information about Integrated Electrical Services, Inc. can be found at
http://www.ies-corporate.com under "Investors." The Company's annual report on
Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, as
well as any amendments to those reports, are available free of charge through
the Company's website as soon as reasonably practicable after they are filed
with, or furnished to, the SEC.

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
(DOLLARS IN MILLIONS, EXCEPT PER SHARE DATA)
(UNAUDITED)
 
                         Three Months Ended September Year Ended September 30,
                         30,
                         2013           2012          2013         2012
                                                                    
Revenues                  $ 123.8        $ 123.4       $ 494.6      $ 456.1
Cost of services         106.5          106.6         427.6        398.1
Gross profit              17.3           16.8          67.0         58.1
Selling, general and     18.5           16.6          66.6         58.6
administrative expenses
Gain on asset sales       --             --           (0.1)        (0.2)
Income (loss) from        (1.2)          0.3           0.4          (0.4)
operations
Interest expense, net    0.3            0.7           1.6          2.3
Other expense (income),  (0.4)           --           0.7          (0.1)
net
Provision (benefit) for  0.1             --           0.3          0.0
income taxes
Net income (loss) from    (1.1)          (0.4)         (2.2)        (2.7)
continuing operations
Net income (loss) from   (0.7)          (1.0)         (1.4)        (9.1)
discontinued operations
Net income (loss)         $ (1.8)        $ (1.5)       $ (3.6)      $ (11.8)
                                                                    
(Loss) per share:                                                   
Continuing operations     $ (0.07)       $ (0.03)      $ (0.15)     $ (0.18)
Discontinued operations   $ (0.05)       $ (0.07)      $ (0.09)     $ (0.63)
Basic                     $ (0.12)       $ (0.10)      $ (0.24)     $ (0.81)
                                                                    
Diluted (loss) per                                                  
share:
Continuing operations     $ (0.07)       $ (0.03)      $ (0.15)     $ (0.18)
Discontinued operations   $ (0.05)       $ (0.07)      $ (0.09)     $ (0.63)
Diluted                   $ (0.12)       $ (0.10)      $ (0.24)     $ (0.81)
                                                                    
Shares used in the
computation of income                                               
(loss) per share:
Basic (in thousands)     15,265         14,820        14,952       14,626
Diluted (in thousands)   15,265         14,820        14,952       14,626
                                                                    

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATION OF ADJUSTED EBITDA 
(DOLLARS IN MILLIONS)
(UNAUDITED)
 
                         Three Months Ended September Year Ended September 30,
                         30,
                         2013           2012          2013         2012
                                                                    
Net income (loss) from    $ (1.1)        $ (0.4)       $ (2.2)      $ (2.7)
continuing operations
Provision (benefit) for   0.1            --            0.3          0.0
income taxes
Interest expense, net     0.3            0.7           1.6          2.3
Depreciation and          0.6            0.6           2.6          2.1
amortization
EBITDA                    (0.2)          0.8           2.3          1.8
Non-cash equity           0.2            0.3           1.1          0.8
compensation expense
Litigation settlement     --             --            --           1.7
Acquisition related       1.4            --            3.0          -- 
expenses
Impact to cost of sales
from purchase accounting  0.2            --            0.2          -- 
adjustments to inventory
Reserve related to
receivable from former    (0.2)          --            1.3          -- 
surety 
Adjusted EBITDA           $ 1.5          $ 1.1         $ 8.0        $ 4.3
                                                                    

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
NON-GAAP RECONCILIATION OF ADJUSTED NET INCOME (LOSS)
(DOLLARS IN MILLIONS)
(UNAUDITED)
 
                         Three Months Ended September Year Ended September 30,
                         30,
                         2013          2012           2013        2012
                                                                   
Net income (loss) from    $ (1.1)       $ (0.4)        $ (2.2)     $ (2.7)
continuing operations
Non-cash equity           0.2           0.3            1.1         0.8
compensation expense
Litigation settlement     --            --             --          1.7
Acquisition related       1.4           --             3.0         -- 
expenses
Impact to cost of sales
from purchase accounting  0.2           --             0.2         -- 
adjustments to inventory
Reserve related to
receivable from former    (0.2)         --             1.3         -- 
surety 
Adjusted net income       $ 0.5         $ (0.1)        $ 3.5       $ (0.1)
(loss)
                                                                   
Adjusted income (loss)                                             
per share:
Basic                     $ 0.03        $ (0.01)       $ 0.23      $ (0.01)
Diluted                   $ 0.03        $ (0.01)       $ 0.23      $ (0.01)
                                                                   
Shares used in the
computation of income                                              
(loss) per share:
Basic (in thousands)     15,265        14,820         14,952      14,626
Diluted (in thousands)   15,265        14,820         14,952      14,626
                                                                   

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
SELECTED BALANCE SHEET AND CASH FLOW INFORMATION
(DOLLARS IN MILLIONS)
(UNAUDITED)
 
                                         September 30, 2013 September 30, 2012
                                                             
Selected Balance Sheet Data:                                 
Cash and cash equivalents (September 30,  $ 20.8             $ 25.9
2012 includes restricted cash)
Net working capital (excludes cash and    $ 28.3             $ 27.6
cash equivalents)
Goodwill and intangible assets            $ 18.1             $ 4.4
Total assets                              $ 179.3            $ 164.7
Total debt                                $ 13.8             $ 10.5
Total stockholders' equity                $ 62.5             $ 53.2
                                                             
Liquidity:                                                   
Cash and cash equivalents plus borrowing  $ 29.2             $ 47.5
availability
                                                             
                                         Year Ended September 30,
                                         2013               2012
                                                             
Cash provided (used) in operating         $ 2.0              $ (7.4)
activities 
Cash provided (used) in investing         $ (4.8)            $ (1.9)
activities 
Cash provided (used) in financing         $ 4.8              $ (7.6)
activities 
                                                             

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
OPERATING SEGMENT STATEMENTS OF OPERATIONS
(DOLLARS IN MILLIONS)
(UNAUDITED)
 
COMMUNICATIONS
                                   Three Months Ended               
                                   September 30,      Year Ended September 30,
                                   2013      2012     2013         2012
                                                                    
Revenues                            $ 30.3    $ 36.8   $ 126.3      $ 121.5
Cost of services                    24.0      30.5     102.6        103.3
Gross profit                        6.3       6.4      23.8         18.2
Selling, general and                3.0       2.9      12.2         11.5
administrative expenses
Corporate allocations               0.3       0.5      1.4          1.9
Income (loss) from operations       $ 2.9     $ 3.0    $ 10.2       $ 4.8
                                                                    
Other data:                                                         
Depreciation & amortization         $ 0.1     $ 0.1    $ 0.4        $ 0.3
expense
Total assets                        $ 24.9    $ 29.6   $ 24.9       $ 29.6
 
RESIDENTIAL
                                   Three Months Ended               
                                   September 30,      Year Ended September 30,
                                   2013      2012     2013         2012
                                                                    
Revenues                            $ 42.8    $ 35.8   $ 162.6      $ 130.0
Cost of services                    35.5      29.9     135.4        109.3
Gross profit                        7.2       5.9      27.2         20.7
Selling, general and                6.7       5.1      24.3         17.8
administrative expenses
Corporate allocations               0.3       0.5      1.1          1.9
Income (loss) from operations       $ 0.2     $ 0.3    $ 1.8        $ 1.0
                                                                    
Other data:                                                         
Depreciation & amortization         $ 0.2     $ 0.1    $ 0.8        $ 0.4
expense
Total assets                        $ 36.8    $ 33.9   $ 36.8       $ 33.9
                                                                    

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
OPERATING SEGMENT STATEMENTS OF OPERATIONS
(DOLLARS IN MILLIONS)
(UNAUDITED)
 
COMMERCIAL & INDUSTRIAL
                            Three Months Ended                     
                            September 30,          Year Ended September 30,
                            2013       2012        2013           2012
                                                                   
Revenues                     $ 48.6     $ 50.7      $ 203.5        $ 204.6
Cost of services             45.2       46.2        188.0          185.5
Gross profit                 3.4        4.5         15.5           19.1
Selling, general and         2.9        3.3         12.2           11.3
administrative expenses
Corporate allocations        0.5        1.4         2.1            5.7
Income (loss) from           $ 0.0      $ (0.2)     $ 1.2          $ 2.1
operations
                                                                   
Other data:                                                        
Depreciation & amortization  $ 0.1      $ 0.1       $ 0.2          $ 0.2
expense
Total assets                 $ 55.3     $ 65.9      $ 55.3         $ 65.9
 
INFRASTRUCTURE SOLUTIONS
                            Three Months Ended                     
                            September 30,          Year Ended September 30,
                            2013       2012        2013           2012
                                                                   
Revenues                     $ 2.2      $ --        $ 2.2          $ -- 
Cost of services             1.7        --          1.7            -- 
Gross profit                 0.4        --          0.4            -- 
Selling, general and         0.3        --          0.3            -- 
administrative expenses
Corporate allocations        --         --          --             -- 
Income (loss) from           $ 0.1      $ --        $ 0.1          $ -- 
operations
                                                                   
Other data:                                                        
Depreciation & amortization  $ 0.0      $ --        $ 0.0          $ -- 
expense
Total assets                 $ 27.9     $ --        $ 27.9         $ -- 
                                                                   
Note: Infrastructure Solutions is comprised of MISCOR; results of operations
are from September 13, 2013, the date of acquisition, to September 30, 2013
                                                                   

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
OPERATING SEGMENT STATEMENTS OF OPERATIONS
(DOLLARS IN MILLIONS)
(UNAUDITED)
 
CORPORATE & OTHER
                                   Three Months Ended               
                                   September 30,      Year Ended September 30,
                                   2013      2012     2013         2012
                                                                    
Revenues                            $ --      $ --     $ --         $ -- 
Cost of services                    --        --       --           -- 
Gross profit                        --        --       --           -- 
Selling, general and                5.5       5.2      17.5         17.8
administrative expenses
Corporate allocations               (1.2)     (2.4)    (4.6)        (9.5)
Income (loss) from operations       (4.4)     (2.9)    (12.8)       (8.3)
Interest and other expense, net     (0.1)     0.7      2.3          2.2
Provision (benefit) for income      0.1       --       0.3         0.0
taxes
Net income (loss) from continuing   $ (4.4)   $ (3.6)  $ (15.4)     $ (10.6)
operations
                                                                    
Other data:                                                         
Depreciation & amortization         $ 0.2     $ 0.3    $ 1.1        $ 1.2
expense
Total assets                        $ 34.3    $ 35.3   $ 34.3       $ 35.3
                                                                    

INTEGRATED ELECTRICAL SERVICES, INC. AND SUBSIDIARIES
DISCONTINUED OPERATIONS STATEMENT OF OPERATIONS
(DOLLARS IN MILLIONS)
(UNAUDITED)
                                   Three Months Ended               
                                   September 30,      Year Ended September 30,
                                   2013      2012     2013         2012
                                                                    
Revenues                            $ 0.2     $ 1.6    $ 1.6        $ 16.3
Cost of services                    0.6       1.5      2.0          20.9
Gross profit                        (0.5)     0.1      (0.5)        (4.7)
Selling, general and                0.1       0.5      0.6          2.6
administrative expenses
Loss (gain) on asset sales          0.1       0.7      0.3          0.8
Restructuring charges               0.0       0.2      0.1          1.2
Loss from discontinued operations   (0.7)     (1.2)    (1.4)        (9.2)
Provision (benefit) for income      0.0       (0.2)    --           (0.0)
taxes
Net loss from discontinued          $ (0.7)   $ (1.0)  $ (1.4)      $ (9.1)
operations

CONTACT: Robert Lewey, CFO
         Integrated Electrical Services, Inc.
         713-860-1500

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