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Matrix Service Reports Fully Diluted Earnings Per Share of $0.31 in the Second Quarter of Fiscal 2007, Ended November 30, 2006
TULSA, Okla., Jan 04, 2007 /PRNewswire-FirstCall via COMTEX/ -- Matrix Service Co. (MTRX), a leading industrial services company, today reported its financial results for the second quarter of fiscal 2007, ended November 30, 2006. Total revenues for the quarter were $166.4 million compared to $126.8 million recorded in the second quarter of fiscal 2006.
Net income for the second quarter of fiscal 2007 was $8.1 million, or $0.31 per fully diluted share, which included pre-tax charges of $0.3 million, or $0.01 per fully diluted share, for the adoption of the fair value recognition provisions in SFAS 123(R) Accounting for Stock-Based Compensation. These results show a 368.2% improvement compared to the prior year when the Company reported second quarter net income of $2.2 million, or $0.10 per fully diluted share.
Michael J. Bradley, president and chief executive officer of Matrix Service Company, said, "We are extremely proud of the results our people have achieved. In the second quarter alone, we expanded our Senior Credit Facility to $75.0 million for five years from $50.0 million, we settled three of the four remaining significant disputed contracts and we announced three significant new projects, which totaled more than $90 million in additions to our backlog."
EBITDA(1) for the second quarter of fiscal 2007 was $14.9 million, compared to $7.6 million for the same period last year. Gross margins on a consolidated basis for the current quarter were 13.2% compared to 10.2% reported in the same quarter a year ago. The gross margins were driven by the improvement in both the Construction Services and the Repair and Maintenance Services segments.
Construction Services revenues for the second quarter 2007 were $83.3 million compared to $48.4 million in the same period a year earlier. The increase was a result of significantly higher construction work in the Downstream Petroleum Industry, where second quarter revenues soared 82.7% to $65.0 million, from $35.5 million in the second quarter of fiscal 2006, by Other Industries' revenues, which gained 44.2% to $14.0 million, from $9.7 million for the year-earlier period, and by Power Industry revenues, which increased 38.1% to $4.3 million, from $3.1 million for the year-earlier period.
Construction Services' gross margins were 11.3% versus 8.5% in the second quarter of fiscal 2006. The second quarter margin improvement was attributable to a robust market environment, effective project execution and the Company's continued focus to manage its contractual risks, while at the same time working with customers to meet their strategic objectives.
Repair and Maintenance Services revenues advanced by $4.7 million, or 6.0%, in the second quarter of 2007 to $83.1 million, from $78.4 million in the same quarter in 2006. The increase was primarily a result of higher Downstream Petroleum Industry revenues, where second quarter revenues rose 5.5% to $78.2 million, from $74.1 million a year earlier, and by Power Industry revenues, which increased 23.8% to $3.7 million, from $3.0 million for the year-earlier period. Gross margins were 15.1% in the quarter versus 11.3% in the second quarter a year ago. Repair and Maintenance Services' gross margins benefited from the higher revenue volumes relative to its overall fixed cost structure.
Six Month Results
For the six months ended November 30, 2006, Matrix Service reported consolidated revenues of $293.2 million versus $235.8 million recorded in the year-earlier period.
Net income for the six month period was $11.1 million, or $0.43 per fully diluted share, which included pre-tax charges of $0.5 million, or $0.01 per fully diluted share, for the adoption of fair value recognition provisions in SFAS 123(R) Accounting for Stock-Based Compensation. These results significantly exceeded the prior year six month period net income of $2.5 million, or $0.13 per fully diluted share. EBITDA(1) for the six months ended November 30, 2006 was $22.1 million, compared with $12.4 million for the year earlier period. Consolidated gross margins increased to 12.0% from 9.8% a year earlier.
Revenues for the Construction Services segment were $160.1 million, compared with $110.6 million for the six months ending November 30, 2005. The increase was due to significantly higher construction work in the Downstream Petroleum Industry, where revenues for the six month period increased 38.9% to $119.4 million versus $86.0 million for the same six month period last year, to higher Other Industries' revenues, which jumped 75.5% to $31.5 million in the recent six month period, versus $17.9 million a year earlier, and to higher Power Industry revenues, which gained 37.9% to $9.2 million in the recent six month period compared to $6.7 million a year earlier. Gross margins in the Construction Services segment increased to 11.1% from 9.5% a year earlier, as margins improved across all industry types from the factors discussed above.
Revenues for Repair and Maintenance Services rose $7.9 million, or 6.4%, to $133.1 million, for the six month period ending November 30, 2006, from $125.2 million for the six month period ending November 30, 2005. The increase was primarily due to significantly higher Downstream Petroleum Industry work, where revenues rose 8.1% to $126.5 million, versus $117.1 million for the same six month period last year. These increases were partially offset by lower Power Industry revenues, which fell 16.0% to $4.9 million in the six month period from $5.9 million in the same six month period last year and by lower Other Industries' revenues, which fell 24.2% to $1.7 million in the six month period from $2.2 million in the same six month period last year. Gross margins were 13.1% versus 10.1% a year earlier.
Mr. Bradley added, "The market environment in the Downstream Petroleum Industry continues to fuel our improving performance. Our backlog of $322 million is approximately 80% within this industry. Based upon these trends, we are again raising our revenue guidance for the full fiscal year to the range of $560 million to $580 million from the previous disclosed range of $510 million to $540 million. We will continue a disciplined contracting strategy aimed at improving profit margins and reducing risk. While there will always be risk in the projects we execute, we are confident in our ability to manage those risks and therefore are also raising our gross profit margin guidance to the range of 11.0% to 12.0% from the targeted range of 10.5% to 11.0% previously reported."
Conference Call Details
In conjunction with the press release, Matrix Service will host a conference call with Michael J. Bradley, president and CEO, and Les Austin, vice president and CFO. The call will take place at 11:00 a.m. (EST)/10:00 a.m. (CST) today and will be simultaneously broadcast live over the Internet at http://www.matrixservice.com or http://www.vcall.com. Please allow extra time prior to the call to visit the site and download the streaming media software required to listen to the Internet broadcast. The online archive of the broadcast will be available within one hour of completion of the live call.
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Jan 04, 2007 (M2 PRESSWIRE via COMTEX) -- Fundamental Review for Matrix Service Co (MTRX)
Matrix Service Company makes sure that oil and water don't mix. The company provides construction and repair services to the petrochemical and power industries as well as to the natural gas, wastewater, pulp and paper, and other industries. Its construction services segment designs and builds plants, refineries, and other installations, and also builds aboveground storage tanks to hold liquids including ethanol, liquefied natural gas, and water and wastewater. Its repair and maintenance unit offers preventive, routine, and emergency repair services. Matrix primarily focuses on turnarounds, outages, and shutdowns, when time is of the essence. The company has some 15 repair facilities in the US and Canada.
Shares were up 12% due to strong demand from the oil industry.
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Matrix Service Co. on Thursday said fiscal second-quarter income more than tripled due to strong demand from the oil industry for its construction and repair services. The company also boosted its revenue forecast.
Net income swelled to $8.1 million, or 31 cents per share, from $2.2 million, or 10 cents per share, in the year-earlier period. The results trumped Wall Street's expectations for earnings of just 18 cents per share, according to a Thomson Financial poll of analysts.
Matrix shares gained more than 18 percent on the news, as the stock added $2.75 at $17.85 in premarket activity.
Revenue grew to $166.4 million from $126.8 million -- a 31 percent jump year over year. Construction services sales surged 72 percent to $83.3 million. Repair and maintenance services revenue rose 6 percent at the same time to $83.1 million.
The company said its consolidated gross margins increased three percentage points to 13.2 percent in the recent quarter versus the same period a year ago, led by improvement in both its construction and maintenance segments.
Michael J. Bradley, president and chief executive, attributed the quarter's growth to a strong market in the oil exploration and production industry. Historically high oil prices have driven oil companies to beef up their exploration and development budgets.
Based on that trend, Matrix raised its revenue guidance for the full fiscal year to a range of $560 million to $580 million from an earlier estimate of $510 million to $540 million. The company raised its gross margin guidance to 11 percent to 12 percent from 10.5 percent to 11 percent.
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Ha, I have hated myself on this one. Wanted to buy in last January but bought CFK instead. Made money on it before it fell, but not as much as I would have made on this MTRX.
-------------------- trashed and scattered again
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