ENGlobal Reports Second Quarter 2014 Results

ENGlobal Reports Second Quarter 2014 Results

HOUSTON, Aug. 8, 2014 (GLOBE NEWSWIRE) -- ENGlobal (Nasdaq:ENG), a leading
provider of engineering and automation services, today announced its financial
results for the second quarter ended June 28, 2014.

HIGHLIGHTS OF CONTINUING OPERATIONS (2^nd QTR 2014 compared to 2^nd QTR 2013):

  *Revenue of $27.2 million, a 32% increase from comparable operations
  *Gross profit margin of 21.3%, an increase of 7.9 percentage points from
    comparable operations
  *Net income from continuing operations of $1.6 million, an increase from a
    net loss of $(1.6) million
  *Earnings from continuing operations of $0.05 per diluted share, an
    increase from a net loss of $(.06) per diluted share

On a comparable basis, revenue from the continuing businesses increased to
$27.2 million. A 32% increase from $20.2 million in the second quarter of
2013. ENGlobal reported net income from continuing operations of $1.6 million,
or $0.05 per diluted share, for the quarter ended June 28, 2014, compared to a
net loss from continuing operations of $(1.6) million, or $(0.06) per diluted
share, for the quarter ended June 29, 2013. During the quarter ended June 28,
2014, the company incurred non-cash expenses for depreciation, amortization
and stock compensation expense of $0.7 million as compared to $0.6 million for
the same period in 2013.

Management's Assessment

Mark Hess, ENGlobal's Chief Financial Officer, said: "I believe we are
continuing to see positive results from initiatives that have been undertaken
at ENGlobal over the last two years. Our improved performance is best
demonstrated by a significant increase in margins, consistent project
execution, as well as substantial internal growth in our continuing
operations."

Mr. Hess continued: "We maintained a substantial cash balance and had no
borrowings during the quarter. However, we are working with a regional bank to
replace our current credit facility that matures at the end of the third
quarter with a similar three year facility that will help provide the working
capital to sustain our growth. While there is still some work to be done, we
expect a new facility to be in place during September."

"We're obviously proud to report this third consecutive profitable quarter,
which represents a major turnaround in our business from recent years," said
William Coskey, P.E., Chairman and Chief Executive Officer of ENGlobal. "We
continue to be excited about capitalizing on ENGlobal's differentiated
expertise and proprietary technologies, whereby we provide value to our
clients. In addition, we expect to begin evaluating select external growth
opportunities – having similar characteristics and potentially providing
additional capabilities for our firm."

The following table illustrates the composition of the Company's revenue and
profitability for its operations for the three months ended June 28, 2014 and
June 29, 2013:

            Quarter Ended                      Quarter Ended
(in          June 28, 2014                      June 29, 2013
thousands)
                     % of    Gross  Operating          % of    Gross  Operating
Segment      Total     Total   Profit Profit    Total     Total   Profit Profit
            Revenue   Revenue Margin Margin    Revenue   Revenue Margin Margin
                                                                 
Engineering
&            $12,629 46.5%   18.5%  10.9%     $10,294 20.3%   11.5%  0.2%
Construction
Automation   14,541    53.5%   23.8%  18.8%     10,362    20.5%   15.2%  7.9%
Operations   --        --%     --%    --%       29,992    59.2%   9.2%   5.8%
Sold
Consolidated $27,170 100.0%  21.3%  5.7%      $50,648 100.0%  10.9%  5.1%

The following table presents certain balance sheet items as of June 28, 2014
and June 29, 2013:

(in thousands)          As of June 28, 2014 As of June 29, 2013
Cash                    $4,060            $784
Working capital         17,981              13,255
Credit facility balance --                  14,688

The Company's Quarterly Report on Form 10-Q for the quarter ended June 28,
2014 will be filed with the Securities and Exchange Commission today
reflecting these results.

About ENGlobal

ENGlobal (Nasdaq:ENG) is a provider of engineering and automation services
primarily to the energy sector throughout the United States and
internationally.ENGlobal operates through two business segments: Automation
and Engineering.ENGlobal's Automation segment provides services related to
the design, fabrication and implementation of distributed control,
instrumentation and process analytical systems.The Engineering segment
provides consulting services for the development, management and execution of
projects requiring professional engineering, construction management, and
related support services.Within the Engineering segment, ENGlobal's
Government Services group provides engineering, design, installation and
operation and maintenance of various government, public sector and
international facilities, and specializes in the turnkey installation and
maintenance of automation and instrumentation systems for the U.S. Defense
industry worldwide.Further information about the Company and its businesses
is available at www.ENGlobal.com.

Safe Harbor for Forward-Looking Statements

The statements above regarding the Company's expectations regarding its
operations and certain other matters discussed in this press release may
constitute forward-looking statements within the meaning of the federal
securities laws and are subject to risks and uncertainties including, but not
limited to: (1)our ability to execute to our internal performance plans such
as our post-divestiture outlook, productivity improvement and cost containment
initiatives; (2)our ability to comply with the terms under our credit
facility; (3)our ability to replace our existing credit facility with a
similar facility by September 30, 2014; (4) our ability to achieve
profitability and sustainable positive cash flow from operations; (5)our
ability to realize revenue projected in our backlog and our ability to collect
accounts receivable and process accounts payable in a timely manner; (6)our
ability to respond appropriately to the current worldwide economic situation
and the resulting decrease in demand for our services; (7) operational and
political risks in Russia and Kazakhstan along the Caspian Sea, (8)our
ability to achieve our business strategy while effectively managing costs and
expenses; (9)the effect of changes in the prices of oil and natural gas;
(10)delays related to contract awards; (11)the effect of changes in laws and
regulations with which the Company must comply and the associated costs of
compliance with such laws and regulations; (12)the effect of changes in
accounting policies and practices as may be adopted by regulatory agencies;
(13) our ability to maintain adequate internal controls; (14)the effect on
our competitive position within our market area in view of, among other
things, competitive pricing pressure; and (15)the uncertainties of the
outcome of litigation. Actual results and the timing of certain events could
differ materially from those projected in or contemplated by the
forward-looking statements due to a number of factors detailed from time to
time in ENGlobal's filings with the Securities and Exchange Commission. In
addition, reference is hereby made to cautionary statements set forth in the
Company's most recent reports on Form 10-K and 10-Q, and other SEC filings.

Click here to join our email list:
http://www.b2i.us/irpass.asp?BzID=702&to=ea&s=0.

CONTACT: Mark A. Hess
         (281) 878-1040
         ir@ENGlobal.com

ENGlobal Logo
 
Press spacebar to pause and continue. Press esc to stop.