MISSION WOODS, Kan., June 3, 2008 (PRIME NEWSWIRE) -- Layne Christensen Company (Nasdaq:LAYN):
* Record revenues for the first quarter, up 21.3% to $244.5 million
from $201.6 million in the prior year.
* Earnings per share increased $0.03 to $0.55 per share compared to
$0.52 per share in the prior year.
* Double-digit revenue growth experienced in all three primary
divisions.
* Mineral exploration division earnings up 102.3% from the prior
year.
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Financial Data Three Months
-------------- ------------------ %
(in 000's, except per share data) 4/30/08 4/30/07 Change
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Revenues
-- Water infrastructure $180,572 $153,509 17.6%
-- Mineral exploration 51,094 37,097 37.7
-- Energy 11,879 9,552 24.4
-- Other 999 1,457 (31.4)
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Total revenues 244,544 201,615 21.3
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Net income 10,562 8,153 29.5
Diluted earnings per share 0.55 0.52 5.8
Weighted average dilutive shares outstanding 19,294 15,752 22.5
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"Revenues were very strong in the first quarter across all primary divisions. The strength in minerals and natural gas prices helped carry earnings past prior year levels. In our water infrastructure division, however, earnings were negatively impacted by heavy rains and snows in certain parts of the U.S. Overall, revenues and earnings for the quarter were Company records. Backlogs remain at record levels in the water infrastructure businesses and weather normally improves as we move towards the summer months. Our minerals and energy divisions should also remain strong." -- Andrew B. Schmitt, President and Chief Executive Officer
Layne Christensen Company (Nasdaq:LAYN), today announced net income for the first quarter ended April 30, 2008 of $10,562,000, or $0.55 per diluted share, compared to net income of $8,153,000, or $0.52 per diluted share last year.
Revenues for the three months ended April 30, 2008 increased $42,929,000, or 21.3%, to $244,544,000 compared to $201,615,000 for the same period last year. Revenues were up across all primary divisions. A further discussion of results of operations by division is presented below.
Selling, general and administrative expenses increased 12.4% to $33,044,000 for the three months ended April 30, 2008 compared to $29,408,000 for the same period last year. The increase was primarily the result of $1,660,000 in expenses added from the acquisitions of Tierdael and SolmeteX and from wage and benefit increases of $2,179,000.
Equity in earnings of affiliates increased 67.5% to $2,497,000 for the three months ended April 30, 2008 from $1,491,000 for the same period last year. The increase reflects continued strong performance in the mineral exploration division by our affiliates in Latin America, particularly in Chile.
Depreciation, depletion and amortization increased 20.3% to $12,441,000 for the three months ended April 30, 2008 compared to $10,338,000 for the same period last year. The increase was primarily the result of increased depletion expense of $579,000 resulting from the increase in production of unconventional gas from the Company's energy operations and additional depreciation from property additions in the other divisions.
Interest expense decreased to $941,000 for the three months ended April 30, 2008 compared to $2,430,000 for the same period last year. The decrease was a result of debt paid off with proceeds of the Company's stock offerings in October 2007.
Income tax expense of $7,967,000 (an effective rate of 43.0%) was recorded for the three months ended April 30, 2008, compared to $5,666,000 (an effective rate of 41.0%) for the same period last year. The difference in the effective rate is primarily attributable to the resolution of certain tax contingencies reflected in the prior year. The effective rate in excess of the statutory federal rate for the periods was due primarily to the impact of nondeductible expenses and the tax treatment of certain foreign operations.
Water Infrastructure Division
(in thousands)
Three Months Ended
April 30,
--------------------
2008 2007
--------- ---------
Revenues $ 180,572 $ 153,509
Income before income taxes 9,189 11,834
Water infrastructure revenues increased 17.6% to $180,572,000 for the three months ended April 30, 2008, from $153,509,000 for the same period last year. The increase in revenues was primarily attributable to additional revenues of $6,348,000 from the Company's acquisitions of Tierdael and SolmeteX, and an increase in sewer rehabilitation revenues of $6,629,000 with the balance of revenue increases spread throughout the group.
Income before income taxes for the water infrastructure division decreased 22.4% to $9,189,000 for the three months ended April 30, 2008, compared to $11,834,000 for the same period last year. Included in last year's income before income taxes was $1,626,000 in non-recurring recovery of previously written off costs associated with a ground water transfer project in Texas. Excluding this item, the 10% decrease in earnings was primarily the result of exceptional rains in the Midwest and heavy snows in the West which slowed productivity on several projects and increased fuel and steel costs which, in some cases, could not be passed on to the customers.
The backlog in the water infrastructure division was $370,742,000 as of April 30, 2008, compared to $336,915,000 as of April 30, 2007.
Mineral Exploration Division
(in thousands)
Three Months Ended
April 30,
--------------------
2008 2007
--------- ---------
Revenues $ 51,094 $ 37,097
Income before income taxes 11,636 5,751
Mineral exploration revenues increased 37.7% to $51,094,000 for the three months ended April 30, 2008 from $37,097,000 for the same period last year. The increase was primarily attributable to continued strength in the Company's markets due to relatively high gold and base metal prices.
Income before income taxes for the mineral exploration division was up 102.3% to $11,636,000 for the three months ended April 30, 2008, compared to $5,751,000 for the same period last year. The improved earnings in the division were primarily attributable to the impact of strong incremental earnings from exploration activity in the Company's African and Australian markets and an increase of $1,006,000 in equity earnings of affiliates in Latin America.
Energy Division
(in thousands)
Three Months Ended
April 30,
--------------------
2008 2007
--------- ---------
Revenues $ 11,879 $ 9,552
Income before income taxes 4,476 3,819
Energy revenues increased 24.4% to $11,879,000 for the three months ended April 30, 2008, compared to revenues of $9,552,000 for the same period last year. The increase in revenues was attributable to both increased production from the Company's unconventional gas properties and higher gas pricing in the Company's market.
Income before income taxes for the energy division was $4,476,000 for the three months ended April 30, 2008, compared to $3,819,000 for the same period last year. The increase in income before income taxes is due to the increases in production and pricing noted above.
Unallocated Corporate Expenses
Corporate expenses not allocated to individual divisions, primarily included in selling, general and administrative expenses, were $5,851,000 and $5,379,000 for the three months ended April 30, 2008 and 2007, respectively. The increase for the quarter was primarily due to wage and benefit increases of $465,000.
Summary of Operating Segment Reconciliation Data
Three Months Ended
April 30,
--------------------
2008 2007
--------- ---------
Revenues
Water infrastructure $ 180,572 $ 153,509
Mineral exploration 51,094 37,097
Energy 11,879 9,552
Other 999 1,457
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Total revenues $ 244,544 $ 201,615
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Equity in earnings of affiliates
Mineral exploration $ 2,497 $ 1,491
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Income before income taxes
Water infrastructure $ 9,189 $ 11,834
Mineral exploration 11,636 5,751
Energy 4,476 3,819
Other 20 224
Unallocated corporate expenses (5,851) (5,379)
Interest (941) (2,430)
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Total income before income taxes $ 18,529 $ 13,819
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This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Exchange Act of 1934. Such statements may include, but are not limited to, statements of plans and objectives, statements of future economic performance and statements of assumptions underlying such statements, and statements of management's intentions, hopes, beliefs, expectations or predictions of the future. Forward-looking statements can often be identified by the use of forward-looking terminology, such as "should," "will," "will be," "intended," "continue," "believe," "may," "hope," "anticipate," "goal," "forecast," "plan," "estimate" and similar words or phrases. Such statements are based on current expectations and are subject to certain risks, uncertainties and assumptions, including but not limited to prevailing prices for various commodities, unanticipated slowdowns in the Company's major markets, the risks and uncertainties normally incident to the construction industry and to the exploration for and development and production of oil and gas, the impact of competition, the effectiveness of operational changes expected to increase efficiency and productivity, worldwide economic and political conditions and foreign currency fluctuations that may affect worldwide results of operations. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially and adversely from those anticipated, estimated or projected. These forward-looking statements are made as of the date of this release, and the Company assumes no obligation to update such forward-looking statements or to update the reasons why actual results could differ materially from those anticipated in such forward-looking statements.
Layne Christensen Company provides sophisticated services and related products for the water, mineral and energy markets.
The Layne Christensen Company logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=3466
LAYNE CHRISTENSEN COMPANY AND SUBSIDIARIES
CONSOLIDATED FINANCIAL DATA
(in thousands, except per share data)
Three Months
Ended April 30,
(unaudited)
--------------------
2008 2007
--------- ---------
Revenues $ 244,544 $ 201,615
Cost of revenues (exclusive of depreciation
shown below) 182,040 147,318
Selling, general and administrative expenses 33,044 29,408
Depreciation, depletion and amortization 12,441 10,338
Other income (expense):
Equity in earnings of affiliates 2,497 1,491
Interest (941) (2,430)
Other income, net (46) 207
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Income before income taxes 18,529 13,819
Income tax expense 7,967 5,666
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Net income $ 10,562 $ 8,153
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Basic income per share $ 0.55 $ 0.53
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Diluted income per share $ 0.55 $ 0.52
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Basic weighted average shares outstanding 19,091 15,517
Dilutive stock options 203 235
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Diluted weighted average shares outstanding 19,294 15,752
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As of
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April 30, January 31,
2008 2008
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Balance Sheet Data:
Cash and cash equivalents $ 65,471 $ 73,068
Working capital, including current maturities
of long term debt 134,045 127,696
Total assets 720,672 696,955
Total long term debt, excluding current
maturities 46,667 46,667
Total stockholders' equity 435,840 423,372
Common shares issued and outstanding 19,176 19,161