Layne Christensen (LAYN) Misses Q3 EPS by 7c, Comments on Outlook

Layne Christensen (NASDAQ: LAYN) reported Q3 EPS of ($0.17), $0.07 worse than the analyst estimate of ($0.10). Revenue for the quarter came in at $173.2 million versus the consensus estimate of $198.11 million.

CEO Commentary

Michael J. Caliel, President and Chief Executive Officer of Layne, commented, "Our third quarter results reflect the ongoing strength of our core water-related platforms, which again delivered higher revenues. In addition, we demonstrated meaningful progress in transforming our Heavy Civil division where we delivered close to break-even results as cost reductions, risk management initiatives and enhanced commercial discipline continued to take hold. The ongoing commodity related headwinds continue to adversely impact our Mineral Services business; however, we anticipate operating this segment on a cash neutral basis going forward. To that end, we are progressing the wind down of our Mineral Services operations in Africa and are currently seeking a number of alternatives to monetize the assets.

"Moreover, we remain committed to transforming our portfolio of businesses and our work to date has allowed us to dramatically improve our credit and liquidity position. This strategic transformation of our operating portfolio continues with the integration of our Energy Services segment into the Water Resources segment. With the strategic and operational synergies that exist in these two business segments, we believe this combination will create a more efficient business model, reduce our cost structure, and still enable us to grow our business with energy clients as conditions improve. Overall, we have enhanced our business and expect next year to be improved over our current fiscal year; however, the winter and holiday season is typically our slowest time of the year and we expect financial results for our fiscal fourth quarter to be lower compared to third quarter results.

"Finally, we continue to also make progress on our company-wide business performance improvement initiative designed to reduce our overall cost structure, enhance our efficiencies, and optimize our commercial strategy with a focus on improving profitability and cash flow. I remain encouraged with our progress thus far, and while we recognize there is much more work ahead of us, we are optimistic about the future of Layne," added Caliel.

For earnings history and earnings-related data on Layne Christensen (LAYN) click here.

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