Gulf Island Fabrication, Inc. Reports Fourth Quarter Earnings

  Gulf Island Fabrication, Inc. Reports Fourth Quarter Earnings

Business Wire

HOUMA, La. -- February 27, 2014

Gulf Island Fabrication, Inc. (NASDAQ: GIFI) today reported net loss of $3.1
million (($.22 diluted loss per share) on revenue of $135.1 million for its
fourth quarter ended December 31, 2013, compared to a net loss of $8.1 million
(($.56) diluted loss per share) on revenue of $129.2 million for the fourth
quarter ended December 31, 2012. Net income for the twelve months ended
December 31, 2013 was $7.2 million ($.50 diluted earnings per share) on
revenue of $608.3 million, compared to net loss of $4.1 million (($.29)
diluted loss per share) on revenue of $521.3 million for the twelve months
ended December 31, 2012.

The company had a revenue backlog of $358.7 million and a labor backlog of
approximately 3.3 million man-hours at December 31, 2013, compared to a
revenue backlog of $537.0 million and a labor backlog of 4.4 million man-hours
reported as of December 31, 2012, including commitments received through
February 27, 2014.

During the quarter ended September 30, 2013, we entered into discussions with
a large deepwater customer concerning our customer’s request for a reduction
in scope of the project, whereby remaining completion and integration work
would be performed at the integration site by a different integration
contractor. During the third quarter of 2013, we transferred the project
deliverables to the integration contractor’s site and removed from backlog
estimated revenue of $25.5 million and estimated labor hours of 271,000 hours
representing our previous estimate of remaining work to complete the project.
Throughout the fourth quarter of 2013 and into the first quarter of 2014, we
continued negotiations with this large deepwater customer with respect to
final amounts due to us and to our subcontractors for claims for work
performed prior to transition of the scope of work to the customer-designated
replacement contractor. In December 2013, we negotiated a final settlement for
all subcontractor scope of work claims. We expect to execute a final change
order to this contract with the customer in early March 2014 that will provide
for a final payment of $11.0 million by our customer during the first half of
2014. Based primarily on the status of these ongoing negotiations, we recorded
an additional loss provision of $18.2 million in the fourth quarter of 2013
related to this project. For the year ended December 31, 2013, we recognized
estimated contract losses of $29.6 million primarily as a result of our
inability to recover certain costs and the de-scoping of this contract.


SELECTED BALANCE SHEET INFORMATION
(in thousands)
                                            December 31,   December 31,
                                                2013            2012
Cash and cash equivalents                    $   36,569       $   24,888
Total current assets                             201,996          173,604
Property, plant and equipment, at cost,net       223,555          229,216
Total assets                                     426,234          403,495
Total current liabilities                        112,275          92,274
Debt                                             -                -
Shareholders' equity                             275,562          273,500
Total liabilities and shareholders' equity       426,234          403,495
                                                                  

The management of Gulf Island Fabrication, Inc. will hold a conference call on
Friday, February 28, 2014, at 9:00 a.m. Central Time (10:00 a.m. Eastern Time)
to discuss the Company’s financial results for the quarter ended December 31,
2013. The call is accessible by webcast (www.gulfisland.com) through CCBN and
by dialing 1.888.262.8790. A digital rebroadcast of the call is available two
hours after the call and ending March 7, 2014 by dialing 1.888.203.1112,
replay passcode: 6355813.

Gulf Island Fabrication, Inc., based in Houma, Louisiana, is a leading
fabricator of offshore drilling and production platforms, hull and/or deck
sections of floating production platforms and other specialized structures
used in the development and production of offshore oil and gas reserves. These
structures include jackets and deck sections of fixed production platforms;
hull and/or deck sections of floating production platforms (such as tension
leg platforms “TLPs”, “SPARs”, “FPSOs”, and “MinDOCs”), piles, wellhead
protectors, subsea templates and various production, compressor and utility
modules, offshore living quarters, towboats, liftboats, tanks  and barges. 
The Company also provides offshore interconnect pipe hook-up, inshore marine
construction, manufacture and repair of pressure vessels, heavy lifts such as
ship integration and TLP module integration, loading and offloading of jack-up
drilling rigs, semi-submersible drilling rigs, TLPs, SPARs, or other similar
cargo, onshore and offshore scaffolding, piping insulation services, and steel
warehousing and sales.


GULF ISLAND FABRICATION, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(in thousands, except per share data)
                                                              
                                                                   
                         Three Months Ended          Twelve Months Ended
                         December 31,                December 31,
                          2013        2012        2013        2012    
                                                                   
Revenue                  $ 135,138     $ 129,237     $ 608,326     $ 521,340
Cost of revenue           136,913     138,591     584,665     517,500 
Gross profit (loss)        (1,775  )     (9,354  )     23,661        3,840
General and
administrative            2,598       2,629       11,555      9,806   
expenses
Operating income           (4,373  )     (11,983 )     12,106        (5,966  )
(loss)
                                                                   
Other income
(expense):
Interest expense           (70     )     (15     )     (237    )     (153    )
Interest income            -             45            3             586
Other income (expense)    (279    )    (11     )    (337    )    128     
                          (349    )    19          (571    )    561     
                                                                   
Income (loss) before       (4,722  )     (11,964 )     11,535        (5,405  )
income taxes
                                                                   
Income taxes              (1,612  )    (3,874  )    4,303       (1,314  )
                                                                   
                                                                   
Net income (loss)        $ (3,110  )   $ (8,090  )   $ 7,232      $ (4,091  )
                                                                   
                                                                   
                                                                   
Per share data:
                                                                   
Basic earnings (loss)
per share - common       $ (0.22   )   $ (0.56   )   $ 0.50       $ (0.29   )
shareholders
                                                                   
Diluted earnings
(loss) per share -       $ (0.22   )   $ (0.56   )   $ 0.50       $ (0.29   )
common shareholders
                                                                   
                                                                   
Weighted-average           14,477        14,421        14,463        14,400
shares
Effect of dilutive
securities: employee      7           -           6           -       
stock options
Adjusted
weighted-average          14,484      14,421      14,469      14,400  
shares
                                                                   
Depreciation and
amortization included    $ 6,362      $ 5,981      $ 25,108     $ 23,396  
in expense above
                                                                   
Cash dividend declared   $ 0.10       $ 0.10       $ 0.40       $ 0.40    
per common share

Contact:

Gulf Island Fabrication, Inc.
Kirk J. Meche, 713-714-6100
Chief Executive Officer
or
Jeffrey M. Favret, 713-714-6100
Chief Financial Officer
 
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