Orion Marine Group (NYSE: ORN) reported Q1 EPS of ($0.08), in-line with the analyst estimate of ($0.08). Revenue for the quarter came in at $166 million versus the consensus estimate of $157.97 million.

First Quarter 2020 Highlights

• Contract revenues were $166.6 million, up 16.4% from $143.1 million for the first quarter of 2019.
• Operating income was $4.4 million for the first quarter of 2020 compared to operating loss of $6.2 million for the first quarter of 2019.
• Net income was $2.7 million ($0.09 diluted earnings per share) for the first quarter of 2020 compared to net loss of $7.9 million ($0.27 diluted loss per share) for the first quarter of 2019.
• The first quarter 2020 net income included $0.3 million ($0.01 loss per diluted share) of non-recurring costs and $0.6 million ($0.02 earnings per diluted share) of tax benefit associated with the reduction of certain valuation allowances. First quarter 2020 adjusted net income was $2.4 million ($0.08 diluted earnings per share). (Please see page 9 of this release for a reconciliation of adjusted net income.)
• EBITDA, adjusted to exclude the impact of the aforementioned non-recurring costs, was $12.2 million in the first quarter of 2020, which compares to adjusted EBITDA of $3.1 million for the first quarter of 2019. (Please see page 10 of this release for an explanation of EBITDA, adjusted EBITDA and a reconciliation to the nearest GAAP measure.)
• Backlog was $609.5 million on a first quarter book-to-bill of 1.22x.

“I want to sincerely thank our team members who are safely working at our project sites, yards, field support offices, and remote locations around the nation and outside the country. Our focus has been to ensure the health and safety of all our people,” stated Mark Stauffer, Orion Group Holdings’ President and Chief Executive Officer. “The current global healthcare crisis resulting from the COVID-19 virus has created significant uncertainty and disruption throughout the U.S. economy, however, Orion’s operations have been determined to be a critical infrastructure service, and we continue to execute on our projects in backlog, with only minor disruptions. As we move toward the ‘re-opening’ of the economy, it is unclear whether we may experience some delays in the timing and execution of new project awards later in the year, or the impacts if we see a second wave of virus spread. We will continue to monitor the latest developments and focus on the health and safety of our employees and executing the work in our backlog.”

“We posted a strong year-over-year improvement in both revenues and profitability in the first quarter, and we also had a strong book-to-bill, leading to a healthy expansion of our backlog,” continued Mr. Stauffer. “With respect to our segment performance, our concrete business generated year-over-year and sequential profitability improvement due to improved man hours per cubic yard. Marine revenues and operating profit were up significantly in the first quarter of 2020, driven by execution related margin gains on several projects in backlog. Also contributing to marine’s year-over-year improvement was increased equipment utilization, which led to higher absorption of fixed costs.”

“Our first quarter backlog was up both sequentially and year-over-year. Despite the broad reaching impacts of the COVID-19 pandemic, up to this point, we continue to see bidding activity in both segments. While we remain focused on continuing to deliver improved performance, given the uncertainty due to the COVID-19 pandemic on the timing and execution of new project awards later in the year we are proactively suspending our previously disclosed full year 2020 guidance for Adjusted EBITDA, which was in the low to mid $40 million range.”

“As part of maintaining the continuity of our operations, not only have we been acutely focused on the efficiency of our project execution, but more importantly, our top priority has been to protect the health and safety of our employees. In this regard, we have implemented a number of policies and procedures at all of our job sites and offices including: Pre-shift temperature testing, social distancing, sanitation and disinfection practices, use of face coverings, COVID-19 specific safety meetings, leadership training, distribution of educational information, remote working when possible and travel restrictions.”

Mr. Stauffer concluded, “The full ramifications of this pandemic for our end markets are as yet unknown. To the extent we gain more visibility regarding the timing and execution of future awards, we will communicate our updated guidance when appropriate. As it relates to our liquidity position, our current levels of cash and revolver availability will provide us with the financial flexibility to continue to execute on projects in backlog and future pursuits. However, as always, we continue to evaluate opportunities to improve our liquidity position. With all of that said, we are encouraged by our strong operational performance in the first quarter and our ability to maintain our backlog at near-record levels. We view these positive trends as indicative of our progress towards sustained profitable growth and free cash flow generation.”

“During the first quarter, we bid on approximately $1 billion of work and were successful on approximately $204 million of these bids,” stated Robert Tabb, Orion Group Holding's Vice President and Chief Financial Officer. “This resulted in a 1.22 times book-to-bill ratio and a win rate of 20.1%. In the marine segment, we bid on approximately $412 million during the first quarter 2020 and were successful on approximately $108 million, representing a win rate of 26.1% and a book-to-bill ratio of 1.25 times. In the concrete segment we bid on approximately $601 million of work and were awarded approximately $96 million, representing a win rate of 16.0% and a book-to-bill ratio of 1.19 times."

For earnings history and earnings-related data on Orion Marine Group (ORN) click here.