MISSION WOODS, Kan., Aug. 28, 2008 (GLOBE NEWSWIRE) -- Layne Christensen Company (Nasdaq:LAYN):
* Record revenues for the second quarter, up 23.8% to $269.6 million from $217.8 million in the prior year. * Earnings per share for the second quarter increased 30% to $0.78 per share compared to $0.60 per share in the prior year. * Double-digit revenue growth experienced in all three primary divisions. ---------------------------------------------------------------------- Financial Data --------------- Three Months Six Months (in 000's, except ------------------ % ------------------ % per share data) 7/31/08 7/31/07 Change 7/31/08 7/31/07 Change ---------------------------------------------------------------------- Revenues --Water infrastructure $196,005 $159,840 22.6% $376,578 $313,349 20.2% --Mineral exploration 59,575 46,408 28.4 110,669 83,505 32.5 --Energy 12,086 9,401 28.6 23,965 18,953 26.4 --Other 1,972 2,195 (10.2) 2,970 3,652 (18.7) ---------------------------------------------------------------------- Total revenues $269,638 $217,844 23.8 $514,182 $419,459 22.6 ---------------------------------------------------------------------- Net income 15,096 9,568 57.8 25,658 17,721 44.8 Dilutive EPS 0.78 0.60 30.0 1.32 1.12 17.9 Weighted average dilutive shares outstanding 19,438 15,898 22.2 19,395 15,862 22.2 ----------------------------------------------------------------------
"Layne experienced a solid quarter across all major businesses. Improving weather in the U.S. was helpful in getting caught up on water projects which were slowed in the first quarter. Mineral exploration activity continued strong throughout most regions despite an early rainy season in West Africa. Higher natural gas pricing and an increased number of well completions kept Layne Energy on a steady upward track. The quarter produced record results in both revenues and earnings as the Company has now gone eighteen consecutive quarters with year-over-year quarterly improvements. Overall, the economy has been getting increasingly difficult and presents a continuing challenge for the Company going forward." -- Andrew B. Schmitt, President and Chief Executive Officer
Layne Christensen Company (Nasdaq:LAYN), today announced net income for the second quarter ended July 31, 2008 of $15,096,000, or $0.78 per diluted share, compared to net income of $9,568,000, or $0.60 per diluted share, last year. For the six months ended July 31, 2008, net income increased to $25,658,000, or $1.32 per share, compared to $17,721,000, or $1.12 per share, last year.
Revenues increased $51,794,000, or 23.8%, to $269,638,000 for the three months ended July 31, 2008, and $94,723,000, or 22.6%, to $514,182,000 for the six months ended July 31, 2008, as compared to the same periods last year. Revenues were up across all divisions. A further discussion of results of operations by division is presented below.
Selling, general and administrative expenses were $36,529,000 and $69,573,000 for the three and six months ended July 31, 2008, respectively, compared to $29,112,000 and $58,520,000 for the same periods last year. The increases for the three and six months, respectively, were primarily the result of $1,772,000 and $3,624,000 in expenses added from acquisitions and start up operations, compensation related expense increases of $2,135,000 and $4,212,000 with the remainder spread in both periods across various categories.
Equity in earnings of affiliates were $3,812,000 and $6,309,000 for the three and six months ended July 31, 2008, respectively, compared to $2,379,000 and $3,870,000 for the same periods last year. The increases reflect continued strong performance in mineral exploration by the Company's affiliates in Latin America, particularly in Chile.
Depreciation, depletion and amortization were $12,955,000 and $25,396,000 for the three and six months ended July 31, 2008, respectively, compared to $10,361,000 and $20,699,000 for the same periods last year. The increases were primarily the result of increased depletion expense of $1,095,000 and $1,674,000 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 $1,019,000 and $1,960,000 for the three and six months ended July 31, 2008, respectively, compared to $2,797,000 and $5,227,000 for the same periods last year. The decrease resulted from the retirement of debt with proceeds of the company's stock offering in October 2007.
Income tax expense was $9,749,000 (an effective rate of 39.2%) and $17,716,000 (an effective rate of 40.8%) for the three and six months ended July 31, 2008, respectively, compared to $8,486,000 (an effective rate of 47.0%) and $14,152,000 (an effective rate of 44.4%) for the same periods last year. The improvements in the effective rate primarily result from the favorable resolution of certain tax audits during the current year. The effective rates in excess of statutory federal rates for the periods were due primarily to the impact of non-deductible expenses and the tax treatment of certain foreign operations.
Water Infrastructure Division (in thousands) Three months ended Six months ended July 31, July 31, ------------------ ------------------ 2008 2007 2008 2007 -------- -------- -------- -------- Revenues $196,005 $159,840 $376,578 $313,349 Income before income taxes 13,150 11,941 22,339 23,775
Water infrastructure revenues increased 22.6% to $196,005,000 and 20.2% to $376,578,000 for the three and six months ended July 31, 2008, respectively, as compared to $159,840,000 and $313,349,000 for the same periods last year. The increases in revenues for the three and six months ended, respectively, were primarily attributed to $6,157,000 and $12,505,000 from acquisitions, $11,592,000 and $15,975,000 from increases in water and wastewater treatment plant construction primarily in the southeastern United States, and $4,805,000 and $11,434,000 from sewer rehabilitation.
Income before income taxes for the water infrastructure division increased 10.1% to $13,150,000 and decreased 6.0% to $22,339,000 for the three and six months ended July 31, 2008, respectively, compared to $11,941,000 and $23,775,000 for the same periods last year. Included in last year's income before income taxes for the six months 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 increases in income before income taxes for the three and six months ended, respectively, were primarily attributable to increases of $1,804,000 and $1,739,000 in earnings from water and wastewater treatment plant construction and $900,000 and $1,692,000 from sewer rehabilitation, reduced earnings from pipeline construction primarily joint venture projects in the Atlanta area which were substantially completed in prior periods.
The backlog for the water infrastructure division at July 31, 2008 was $477,675,000 compared to $364,248,000 at July 31, 2007.
Mineral Exploration Division (in thousands) Three months ended Six months ended July 31, July 31, ------------------ ------------------ 2008 2007 2008 2007 -------- -------- -------- -------- Revenues $ 59,575 $ 46,408 $110,669 $ 83,505 Income before income taxes 15,279 11,291 26,915 17,042
Mineral exploration revenues increased 28.4% to $59,575,000 and 32.5% to $110,669,000 for the three and six months ended July 31, 2008, respectively, compared to $46,408,000 and $83,505,000 for the same periods last year. The increases were 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 increased 35.3% to $15,279,000 and 57.9% to $26,915,000 for the three and six months ended July 31, 2008, respectively, compared to $11,291,000 and $17,042,000 for the same periods last year. The improved earnings in the division were primarily attributable to the impact of strong incremental earnings from exploration activities in the Company's markets and an increase of $1,433,000 and $2,439,000 in equity earnings of affiliates in Latin America for the three and six month periods, respectively.
Energy Division (in thousands) Three months ended Six months ended July 31, July 31, ------------------ ------------------ 2008 2007 2008 2007 -------- -------- -------- -------- Revenues $ 12,086 $ 9,401 $ 23,965 $ 18,953 Income before income taxes 3,566 2,752 8,042 6,571
Energy revenues increased 28.6% to $12,086,000 and 26.4% to $23,965,000 for the three and six months ended July 31, 2008, respectively, compared to $9,401,000 and $18,953,000 for the same periods last year. The increases in revenues were 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 increased 29.6% to $3,566,000 and 22.4% to $8,042,000 for the three and six months ended July 31, 2008, respectively, compared to $2,752,000 and $6,571,000 for the same periods last year. The increases in income before income taxes were 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 $6,970,000 and $12,821,000 for the three and six months ended July 31, 2008, respectively, compared to $5,505,000 and $10,824,000 for the same periods last year. The increases for the periods were primarily due to compensation related expenses.
Summary of Operating Segment Reconciliation Data Three Months Ended Six Months Ended July 31, July 31, ------------------ ------------------ 2008 2007 2008 2007 -------- -------- -------- -------- Revenues Water infrastructure $196,005 $159,840 $376,578 $313,349 Mineral exploration 59,575 46,408 110,669 83,505 Energy 12,086 9,401 23,965 18,953 Other 1,972 2,195 2,970 3,652 -------- -------- -------- -------- Total revenues $269,638 $217,844 $514,182 $419,459 ======== ======== ======== ======== Equity in earnings of affiliates Mineral exploration $ 3,812 $ 2,379 $ 6,309 $ 3,870 ======== ======== ======== ======== Income before income taxes Water infrastructure $ 13,150 $ 11,941 $ 22,339 $ 23,775 Mineral exploration 15,279 11,291 26,915 17,042 Energy 3,566 2,752 8,042 6,571 Other 839 372 859 596 Unallocated corporate expenses (6,970) (5,505) (12,821) (10,884) Interest (1,019) (2,797) (1,960) (5,227) -------- -------- -------- -------- Total income before income taxes $ 24,845 $ 18,054 $ 43,374 $ 31,873 ======== ======== ======== ========
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," "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.globenewswire.com/newsroom/prs/?pkgid=3466
LAYNE CHRISTENSEN COMPANY AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (in thousands, except per share data) Three Months Six Months Ended July 31, Ended July 31, (unaudited) (unaudited) ------------------ ------------------ 2008 2007 2008 2007 -------- -------- -------- -------- Revenues $269,638 $217,844 $514,182 $419,459 Cost of revenues (exclusive of depreciation, depletion and amortization shown below) 198,795 160,217 380,835 307,535 Selling, general and administrative expenses 36,529 29,112 69,573 58,520 Depreciation, depletion and amortization 12,955 10,361 25,396 20,699 Other income (expense): Equity in earnings of affiliates 3,812 2,379 6,309 3,870 Interest (1,019) (2,797) (1,960) (5,227) Other income, net 693 318 647 525 -------- -------- -------- -------- Income before income taxes 24,845 18,054 43,374 31,873 Income tax expense 9,749 8,486 17,716 14,152 -------- -------- -------- -------- Net income $ 15,096 $ 9,568 $ 25,658 $ 17,721 ======== ======== ======== ======== Basic income per share $ 0.79 $ 0.61 $ 1.34 $ 1.14 ======== ======== ======== ======== Diluted income per share $ 0.78 $ 0.60 $ 1.32 $ 1.12 ======== ======== ======== ======== Weighted average shares outstanding-basic 19,132 15,565 19,111 15,541 Dilutive stock options 306 333 284 321 -------- -------- -------- -------- Weighted average shares outstanding-diluted 19,438 15,898 19,395 15,862 ======== ======== ======== ======== As of ------------------ July 31, Jan. 31, 2008 2008 -------- -------- Balance Sheet Data: Cash and cash equivalents $ 14,168 $ 73,068 Working capital, including current maturities of long term debt 127,125 127,696 Total assets 729,078 696,955 Total long term debt, excluding current maturities 33,334 46,667 Total stockholders' equity 452,810 423,372 Common shares issued and outstanding 19,260 19,161