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Goldfield Announces Strong First Quarter Results

May 6, 2016 6:46 AM EDT

MELBOURNE, FL -- (Marketwired) -- 05/06/16 -- The Goldfield Corporation (NYSE MKT: GV), today announced strong results for the first quarter ended March 31, 2016. The Goldfield Corporation headquartered in Florida, through its subsidiaries, Power Corporation of America, Southeast Power Corporation and C and C Power Line, Inc., is a leading provider of electrical construction services for the utility industry and industrial customers, with operations primarily in the Southeast and mid-Atlantic regions of the United States and in Texas.

First quarter ended March 31, 2016, compared to the first quarter in 2015:

  • Revenue grew 17.1% to $35.8 million from $30.5 million. Electrical construction revenue increased 14.6%, attributable to growth in both master service agreements ("MSAs") and non-MSA electrical construction projects.

  • Income from continuing operations before taxes increased to $6.8 million from a loss of $1.6 million. This increase was fueled by a twelve-fold increase in electrical construction operations income before income taxes(1) resulting from sharply higher revenues and improved operating efficiencies. Margins on electrical construction operations operating income increased to 23.1% from negative 1.7%.(1) The results for the first quarter 2015 included a pre-tax operating loss of $3.9 million on the now completed Texas projects.

  • EBITDA(1) improved to $8.5 million from $199,000, as a result of the same factors which drove the growth in our pre-tax operating income.

  • Net income grew to $4.3 million ($0.17 per share) from a net loss of $846,000 ($0.03 loss per share).

Backlog

As of March 31, 2016, revenue from our project-specific firm contracts expected to be realized within twelve months increased to $36.6 million from $31.7 million as of the same date last year. Total backlog was $160.7 million as of March 31, 2016, compared to $249.6 million as of March 31, 2015. The decline resulted primarily from completion of work under existing MSA agreements not yet eligible for renewal. The size and amount of future projects awarded under MSAs cannot be determined with certainty and revenue from such contracts may vary substantially from current estimates.

President and Chief Executive Officer John H. Sottile said, "The strong results in the first quarter of 2016 continue the turnaround for our electrical construction operations achieved in 2015. We believe that the increasing demand for our electrical construction services and our focus on improving operating efficiencies position us well to take advantage of future opportunities."

About Goldfield

Goldfield is a leading provider of electrical construction services engaged in the construction of electrical infrastructure for the utility industry and industrial customers, primarily in the Southeast and mid-Atlantic regions of the United States and in Texas.

For additional information on our 2016 first quarter results, please refer to our report on Form 10-Q being filed with the Securities and Exchange Commission and visit the Company's website at http://www.goldfieldcorp.com.

___________________

(1) Represents Non-GAAP Financial Measure - The non-GAAP financial measures used in this earnings release are more fully described in the accompanying supplemental data and reconciliation of non-GAAP financial measures to the reported GAAP measures. The non-GAAP measures in this press release and on The Goldfield Corporation's website are provided to enable investors and analysts to evaluate the Company's performance excluding the effects of certain items that impact the comparability of operating results between reporting periods and compare the Company's operating results with those of its competitors. These measures should be used to supplement, and not in lieu of, results prepared in conformity with GAAP. Because not all companies use identical calculations, this presentation of electrical construction operations operating income (loss), electrical construction operations income (loss) before taxes and EBITDA may not be comparable to other similarly-titled measures of other companies.

Forward-Looking Statements

This press release includes forward-looking statements within the meaning of the "safe harbor" provision of the Private Securities Litigation Reform Act of 1995 throughout this document. You can identify these statements by forward-looking words such as "may," "will," "expect," "anticipate," "believe," "estimate," "plan," and "continue" or similar words. We have based these statements on our current expectations about future events. Although we believe that our expectations reflected in or suggested by our forward-looking statements are reasonable, we cannot assure you that these expectations will be achieved. Our actual results may differ materially from what we currently expect. Factors that may affect the results of our operations include, among others: the level of construction activities by public utilities; the concentration of revenue from a limited number of utility customers; the loss of one or more significant customers; the timing and duration of construction projects for which we are engaged; our ability to estimate accurately with respect to fixed price construction contracts; and heightened competition in the electrical construction field, including intensification of price competition. Other factors that may affect the results of our operations include, among others: adverse weather; natural disasters; effects of climate changes; changes in generally accepted accounting principles; ability to obtain necessary permits from regulatory agencies; our ability to maintain or increase historical revenue and profit margins; general economic conditions, both nationally and in our region; adverse legislation or regulations; availability of skilled construction labor and materials and material increases in labor and material costs; and our ability to obtain additional and/or renew financing. Other important factors which could cause our actual results to differ materially from the forward-looking statements in this press release are detailed in the Company's Risk Factors and Management's Discussion and Analysis of Financial Condition and Results of Operation sections of our Annual Report on Form 10-K and Goldfield's other filings with the Securities and Exchange Commission, which are available on Goldfield's website: http://www.goldfieldcorp.com. We may not update these forward-looking statements, even in the event that our situation changes in the future, except as required by law.

                 The Goldfield Corporation and Subsidiaries                 
                    Consolidated Statements of Operations                   
                                 (Unaudited)                                
                                                                            
                                                    Three Months Ended      
                                                        March 31,           
                                               ---------------------------- 
                                                    2016           2015     
                                               -------------  ------------- 
Revenue                                                                     
  Electrical construction                      $  34,841,504  $  30,400,162 
  Other                                              917,480        146,645 
                                               -------------  ------------- 
    Total revenue                                 35,758,984     30,546,807 
                                               -------------  ------------- 
Costs and expenses                                                          
  Electrical construction                         25,156,975     29,233,723 
  Other                                              657,329        127,734 
  Selling, general and administrative              1,430,414      1,001,710 
  Depreciation and amortization                    1,537,974      1,613,845 
  Loss on sale of property and equipment              19,437          5,627 
                                               -------------  ------------- 
    Total costs and expenses                      28,802,129     31,982,639 
                                               -------------  ------------- 
      Total operating income (loss)                6,956,855     (1,435,832)
                                               -------------  ------------- 
Other income (expense), net                                                 
  Interest income                                      6,820          5,865 
  Interest expense                                  (159,548)      (170,053)
  Other income, net                                   15,378         15,376 
                                               -------------  ------------- 
    Total other expense, net                        (137,350)      (148,812)
                                               -------------  ------------- 
Income (loss) from continuing operations                                    
 before income taxes                               6,819,505     (1,584,644)
Income tax provision                               2,519,489       (738,309)
                                               -------------  ------------- 
Income (loss) from continuing operations           4,300,016       (846,335)
Loss from discontinued operations, net of                                   
 income tax benefit of $23,884 in 2016               (39,845)             - 
                                               -------------  ------------- 
Net income (loss)                              $   4,260,171  $    (846,335)
                                               =============  ============= 
Net income (loss) per share of common stock -                               
 basic and diluted                                                          
  Continuing operations                        $        0.17  $       (0.03)
  Discontinued operations                                  -              - 
                                               -------------  ------------- 
    Net income (loss)                          $        0.17  $       (0.03)
                                               =============  ============= 
Weighted average shares outstanding - basic                                 
 and diluted                                      25,451,354     25,451,354 
                                               =============  ============= 
                                                                            
                                                                            
                 The Goldfield Corporation and Subsidiaries                 
                    Condensed Consolidated Balance Sheets                   
                                 (Unaudited)                                
                                                                            
                                                 March 31,    December 31,  
                                                   2016           2015      
                                               -------------  ------------- 
                    ASSETS                                                  
Current assets                                                              
  Cash and cash equivalents                    $   6,951,177  $  11,374,238 
  Accounts receivable and accrued billings,                                 
   net                                            18,975,274     17,250,067 
  Costs and estimated earnings in excess of                                 
   billings on uncompleted contracts              17,471,792     10,292,199 
  Prepaid expenses                                 1,636,907      1,210,780 
  Deferred income taxes                                    -        773,245 
  Other current assets                             1,047,046      1,334,080 
                                               -------------  ------------- 
    Total current assets                          46,082,196     42,234,609 
                                                                            
Property, buildings and equipment, at cost,                                 
 net                                              33,609,908     34,671,947 
Deferred charges and other assets                  4,364,150      4,257,051 
                                               -------------  ------------- 
Total assets                                   $  84,056,254  $  81,163,607 
                                               =============  ============= 
                                                                            
     LIABILITIES AND STOCKHOLDERS' EQUITY                                   
Current liabilities                                                         
  Accounts payable and accrued liabilities     $   9,183,221  $  10,002,231 
  Contract loss accruals                              79,318         65,322 
  Current portion of notes payable, net            6,102,405      5,815,510 
  Income taxes payable                             2,145,084        483,763 
  Accrued remediation costs                          179,986        135,786 
  Other current liabilities                           14,838        234,161 
                                               -------------  ------------- 
    Total current liabilities                     17,704,852     16,736,773 
                                                                            
Deferred income taxes                              7,526,412      8,328,492 
Accrued remediation costs, less current                                     
 portion                                             103,824        107,429 
Notes payable, less current portion, net          19,130,332     20,656,402 
Other accrued liabilities                             79,850         83,698 
                                               -------------  ------------- 
Total liabilities                                 44,545,270     45,912,794 
                                               -------------  ------------- 
Commitments and contingencies                                               
Stockholders' equity                                                        
  Common stock                                     2,781,377      2,781,377 
  Capital surplus                                 18,481,683     18,481,683 
  Retained earnings                               19,556,111     15,295,940 
  Common stock in treasury, at cost               (1,308,187)    (1,308,187)
                                               -------------  ------------- 
    Total stockholders' equity                    39,510,984     35,250,813 
                                               -------------  ------------- 
Total liabilities and stockholders' equity     $  84,056,254  $  81,163,607 
                                               =============  ============= 
                                                                            
                                                                            

The Goldfield Corporation and Subsidiaries
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

Electrical construction operations operating income (loss), is defined as total operating income (loss) adjusted for non-electrical construction activity within total operating income (loss) including: other operations gross margins (loss) and non-electrical construction selling, general and administrative, depreciation and amortization, and gain or loss on sale of property and equipment. Electrical construction operations operating income (loss), a non-GAAP financial measure, does not purport to be an alternative to the Company's total operating income (loss) as a measure of operations. Because not all companies use identical calculations, this presentation of electrical construction operations operating income (loss) may not be comparable to other similarly-titled measures of other companies. We believe investors may benefit from the presentation of electrical construction operations operating income (loss) in evaluating our operating performance because it provides our investors with an additional tool to compare our operating performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our core operations and is useful in comparing our operating results with those of our competitors.

                                                                            
                                                                            
                                                   Three Months Ended       
                                                       March 31,            
                                              ----------------------------  
Electrical Construction Operations Operating                                
 Income (Loss)                                    2016           2015       
--------------------------------------------- -------------  -------------  
Total operating income (loss) (GAAP as                                      
 reported)                                    $   6,956,855  $  (1,435,832) 
Total operating income (loss) (GAAP as                                      
 reported) as a percentage of total revenue                                 
 ($35,758,984 and $30,546,807 for the three                                 
 months ended March 31, 2016 and 2015,                                      
 respectively)                                         19.5%          (4.7)%
  Other operations gross (loss)                    (260,151)       (18,911) 
  Non-electrical construction selling,                                      
   general and administrative                     1,316,997        912,240  
  Non-electrical construction depreciation                                  
   and amortization                                  30,362         30,489  
                                              -------------  -------------  
Electrical construction operations operating                                
 income (loss)                                $   8,044,063  $    (512,014) 
                                              =============  =============  
Electrical construction operations operating                                
 income (loss) as a percentage of electrical                                
 construction revenue ($34,841,504 and                                      
 $30,400,162 for the three months ended March                               
 31, 2016 and 2015, respectively)                      23.1%          (1.7)%
                                                                            
                                                                            

The Goldfield Corporation and Subsidiaries
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

Electrical construction operations income (loss) before income taxes, is defined as consolidated income (loss) from continuing operations before income taxes adjusted for non-electrical construction activity within income (loss) from continuing operations before income taxes including: other operations gross margins (loss) and non-electrical construction selling, general and administrative, depreciation and amortization, gain or loss on sale of property and equipment, interest income, interest expense, and other income. Electrical construction operations income (loss) before income taxes, a non-GAAP financial measure, does not purport to be an alternative to the Company's consolidated income (loss) from continuing operations before income taxes as a measure of income (loss). Because not all companies use identical calculations, this presentation of electrical construction operations income (loss) before income taxes may not be comparable to other similarly-titled measures of other companies. We believe investors may benefit from the presentation of electrical construction operations income (loss) before income taxes in evaluating our performance because it provides our investors with an additional tool to compare our performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our core results and is useful in comparing our results with those of our competitors.

                                                                            
                                                                            
                                                    Three Months Ended      
                                                        March 31,           
                                               ---------------------------- 
Electrical Construction Operations Income                                   
 (Loss) Before Income Taxes                        2016           2015      
---------------------------------------------- -------------  ------------- 
Total income (loss) from continuing operations                              
 before income taxes (GAAP as reported)        $   6,819,505  $  (1,584,644)
  Other operations gross (loss)                     (260,151)       (18,911)
  Non-electrical construction selling, general                              
   and administrative                              1,316,997        912,240 
  Non-electrical construction depreciation and                              
   amortization                                       30,362         30,489 
  Non-electrical construction interest                                      
   (income)                                           (2,166)        (2,200)
  Non-electrical construction other (income),                               
   net                                               (14,703)       (14,317)
                                               -------------  ------------- 
Electrical construction operations income                                   
 (loss) before income taxes                    $   7,889,844  $    (677,343)
                                               =============  ============= 
                                                                            
                                                                            

The Goldfield Corporation and Subsidiaries
Reconciliation of Non-GAAP Financial Measures
(Unaudited)

EBITDA, a non-GAAP performance measure used by management, is defined as net income (loss) plus: interest income and expense, provision (benefit) for income taxes and depreciation and amortization, as shown in the table below. EBITDA, a non-GAAP financial measure, does not purport to be an alternative to net income (loss) as a measure of operating performance. Because not all companies use identical calculations, this presentation of EBITDA may not be comparable to other similarly-titled measures of other companies. We use, and we believe investors benefit from the presentation of, EBITDA in evaluating our operating performance because it provides us and our investors with an additional tool to compare our operating performance on a consistent basis by removing the impact of certain items that management believes do not directly reflect our core operations. We believe that EBITDA is useful to investors and other external users of our financial statements in evaluating our operating performance because EBITDA is widely used by investors to measure a company's operating performance without regard to items such as interest expense, taxes, and depreciation and amortization, which can vary substantially from company to company depending upon accounting methods and book value of assets, capital structure and the method by which assets were acquired.

                                                    Three Months Ended      
                                                         March 31,          
                                                --------------------------- 
EBITDA                                              2016          2015      
----------------------------------------------- ------------- ------------- 
Net income (loss) (GAAP as reported)            $   4,260,171 $    (846,335)
  Interest expense                                    159,548       170,053 
  Provision for income taxes, net                   2,495,605      (738,309)
  Depreciation and amortization (1)                 1,537,974     1,613,845 
                                                ------------- ------------- 
EBITDA                                          $   8,453,298 $     199,254 
                                                ============= ============= 
___________                                                                 
(1) Depreciation and amortization includes depreciation on property, plant  
 and equipment and amortization of finite-lived intangible assets.          
   For further information, please contact:The Goldfield CorporationPhone: (321) 724-1700Email: [email protected]

Source: The Goldfield Corporation



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