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     575  0 Kommentare Granite Reports Third Quarter 2019 Results

    Granite Construction Incorporated (NYSE: GVA) today reported net income of $20.5 million ($0.43 per diluted share) for the quarter ended September 30, 2019, compared to net income of $55.7 million ($1.17 per diluted share) for the quarter ended September 30, 2018. On a year-to-date basis, net loss was $111.9 million, ($2.39 per diluted share) compared to net income of $35.9 million ($0.84 per diluted share) last year.

    “During the third quarter, strong core operational performance was dampened by a negative contribution from the Heavy Civil operating group primarily driven by disputed work,” said James H. Roberts, President and Chief Executive Officer at Granite Construction Incorporated. “Our core businesses capitalized on good weather this quarter combined with well-funded infrastructure markets. As we restore balance in Heavy Civil, a critical piece of the puzzle is resolution of ongoing disputes which continue to have a distorted impact on our cash flows and earnings. We have completed our strategic review of this business unit and have taken immediate action including:

    • Changed operational management to align Heavy Civil operating group with construction and materials operations;
    • Targeting revenue of no more than 15 percent of overall company revenue for this portfolio;
    • Aggressively pursuing dispute avoidance and resolution;
    • Implementing refined estimating and risk mitigation approach to project pricing; and
    • Pursuing projects solely in markets with strategic, competitive advantages

    “A critical component of our current and future success is consistent performance on projects at scale, in this case projects typically in a range of about $100 million to $500 million, with particular emphasis on best-value procurements with more defined design and appropriate risk-sharing. With that said, the vast majority of Granite’s robust project pipeline is comprised of projects well below this level, reflecting our deliberate focus on de-risking our portfolio. Steady funding and buoyant market conditions have resulted in strong bookings, driving more than 44 percent growth in our CAP to $4.7 billion.”

    Third quarter 2019 and 2018 results include after-tax, acquisition-related expenses of $7.1 million and $12.2 million, respectively3. Excluding the impact of acquisition-related expenses, third quarter 2019 adjusted net income was $27.5 million1 and 2018 adjusted net income was $67.9 million1, with adjusted income per diluted share of $0.581 and $1.431, respectively.

    Selling, general & administrative (“SG&A”) expenses were $73.4 million for the three months ended September 30, 2019, compared to $70.8 million last year. For the first nine months of 2019, SG&A expenses were $224.6 million, compared to $193.3 million during the same prior-year period. The year-to-date increase is primarily attributable to businesses acquired in 2018.

    Cash and marketable securities increased to a total $232.6 million as of September 30, 2019 compared to $206.0 million as of June 30, 2019.

    The Company’s effective tax rate in the third quarter was 13.7 percent.

    Third Quarter and Year-To-Date 2019 Segment Results

    Transportation

    • Third quarter 2019 revenue was $598.6 million, compared to $610.8 million in last year’s quarter. Year-to-date 2019 revenue decreased 9.0 percent to $1.3 billion compared to $1.5 billion last year. The year-to-date revenue was impacted by inclement weather that spanned the first part of the year.
    • Third quarter 2019 gross profit was $13.6 million, which included $69.3 million of Heavy Civil operating group losses. Third quarter 2018 gross profit of $71.0 million included $8.2 million of Heavy Civil operating group losses. Year-to-date gross loss was $(65.0) million, compared to a gross profit of $138.4 million last year. Challenges related to projects in our Heavy Civil operating group have negatively affected 2019 results, while the remaining construction and materials business in this segment performed at exceptional levels.
    • Segment CAP totaled nearly $3.7 billion as of September 30, 2019, including $1.0 billion of construction management/general contractor (CMGC) and alternative procurement projects.

    Water

    • Third quarter 2019 revenue was $135.9 million compared to $124.3 million in last year’s quarter. Year-to-date 2019 revenue was $348.0 million, compared to $216.0 million last year. The year-to-date revenue increases were primarily related to 2018 acquisitions, partially dampened by inclement weather experienced across our operations through May.
    • Third quarter 2019 gross profit was $15.0 million compared to $24.1 million last year, with gross profit margin slightly lower at 11.1 percent. Year-to-date gross profit was $34.4 million, compared to $41.1 million last year. Year-to-date gross profit margin was 9.9 percent, down from 19.0 percent in 2018, which included non-recurring emergency work in the prior year. In the current year, gross profit was negatively impacted by a business acquired with the Layne Christensen Company acquisition that we recently divested.
    • Segment CAP totaled $244.9 million as of September 30, 2019.

    Specialty

    • Third quarter 2019 revenue was $224.5 million, compared to $190.8 million in last year’s quarter. Year-to-date 2019 revenue was $540.2 million, compared to $461.1 million last year. The revenue increases reflect robust private-market work in our site preparation, power and mining services end markets. On a year-to-date basis, the increase also included the impact related to an acquisition in 2018.
    • Third quarter 2019 gross profit was $38.3 million compared to $28.1 million last year, with gross profit margin of 17.1 percent up from 14.7 percent last year. Year-to-date gross profit was $75.4 million, compared to $65.3 million last year, with gross profit margin relatively flat at 14.0 percent.
    • Segment CAP totaled $746.6 million as of September 30, 2019.

    Materials

    • Third quarter 2019 revenue was $129.1 million, compared to $129.6 million in last year’s quarter. Year-to-date 2019 revenue was $268.4 million, compared to $276.3 million last year. The modest year-to-date decline is attributable to inclement weather across the western United States through May.
    • Third quarter 2019 gross profit was $24.5 million, compared to $21.3 million last year, with gross profit margin of 19.0 percent, up from 16.4 percent in 2018. Year-to-date gross profit was $34.7 million, compared to $36.3 million last year, with gross profit margin of 12.9 percent, down slightly from 13.1 percent in 2018, as wet weather persisted through May and slowed plant productivity in the first half of 2019.

    Outlook and Guidance

    “The alignment of operational capabilities with strategic opportunities at scale will match and be integrated into how we approach our entire portfolio, with all of our businesses using and operating with and from the same playbook,” Roberts said. “These actions set us on a more defined path for future success. Granite has written its nearly century-long history by consistently balancing resources, opportunities, and risks. The actions we are taking are expected to restore balance and eliminate distractions, enabling our talented teams to execute end-market growth strategies and create more value for all of our stakeholders.

    “Current operational momentum, robust market dynamics and our strong CAP combined with favorable weather patterns the rest of this year should allow our businesses to deliver positive results well into the fourth quarter. As we look ahead, these positive dynamics have us well positioned for 2020.”

    While not providing guidance for the remainder of the year, our preliminary expectations for 2020 are:

    • Mid-single digit consolidated revenue growth
    • Adjusted EBITDA margin1 of 6.5 percent to 8.5 percent

    (1)

    Adjusted net income (loss), adjusted diluted income (loss) per share, earnings before interest, taxes, depreciation, and amortization (“EBITDA”), adjusted EBITDA, and adjusted EBITDA margin are non-GAAP measures. Please refer to the description and reconciliation of non-GAAP measures in the attached tables.

    (2)

    CAP is comprised of unearned revenue and other awards, as well as CMGC and alternative procurement projects.

    (3)

    Acquisition-related expenses include acquisition, integration, acquired intangible amortization expenses, acquisition-related depreciation and synergy costs.

    Conference Call

    Granite will conduct a conference call today, October 25, 2019, at 8:00 a.m. Pacific Time/11:00 a.m. Eastern Time to discuss the results of the quarter ended September 30, 2019. The Company invites investors to listen to a live audio webcast on its Investor Relations website, https://investor.graniteconstruction.com. The live call is available by calling 1-800-353-6461; international callers may dial 1-334-323-0501. An archive of the webcast will be available on the website approximately one hour after the call. A replay will be available after the live call through November 1, 2019, by calling 1-888-203-1112, replay access code 2883572; international callers may dial 1-719-457-0820.

    About Granite

    Granite is America’s Infrastructure Company. Incorporated since 1922, Granite (NYSE:GVA) is one of the largest diversified construction and construction materials companies in the United States as well as a full-suite provider in the transportation, water infrastructure and mineral exploration markets. Granite’s Code of Conduct and strong Core Values guide the Company and its more than 7,000 employees to uphold the highest ethical standards. In addition to being one of the World’s Most Ethical Companies for ten consecutive years, Granite is an industry leader in safety and an award-winning firm in quality and sustainability. For more information, visit graniteconstruction.com, and connect with Granite on LinkedIn, Twitter, Facebook and Instagram.

    Forward-looking Statements

    Any statements contained in this news release that are not based on historical facts, including statements regarding future events, occurrences, circumstances, activities, performance, growth, demand, strategic plans, outcomes, guidance, backlog, Committed and Awarded Projects (CAP), and results, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements are identified by words such as “future,” “outlook,” “assumes,” “believes,” “expects,” “estimates,” “anticipates,” “intends,” “plans,” “appears,” “may,” “will,” “should,” “could,” “would,” “continue,” and the negatives thereof or other comparable terminology or by the context in which they are made. These forward-looking statements are estimates reflecting the best judgment of senior management and reflect our current expectations regarding future events, occurrences, circumstances, activities, performance, growth, demand, strategic plans, outcomes, guidance, backlog, CAP, and results. These expectations may or may not be realized. Some of these expectations may be based on beliefs, assumptions or estimates that may prove to be incorrect. In addition, our business and operations involve numerous risks and uncertainties, many of which are beyond our control, which could result in our expectations not being realized or otherwise materially affect our business, financial condition, results of operations, cash flows and liquidity. Such risks and uncertainties include, but are not limited to, those described in greater detail in our filings with the Securities and Exchange Commission, particularly those specifically described in our Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

    Due to the inherent risks and uncertainties associated with our forward-looking statements, the reader is cautioned not to place undue reliance on them. The reader is also cautioned that the forward-looking statements contained herein speak only as of the date of this news release and, except as required by law; we undertake no obligation to revise or update any forward-looking statements for any reason.

    GRANITE CONSTRUCTION INCORPORATED

    CONDENSED CONSOLIDATED BALANCE SHEETS

    (Unaudited - in thousands, except share and per share data)

     

     

     

     

     

     

     

     

     

     

     

     

    September 30,
    2019

     

     

    December 31,
    2018

     

     

    September 30,
    2018

     

    ASSETS

     

     

     

     

     

     

     

     

     

     

     

     

    Current assets

     

     

     

     

     

     

     

     

     

     

     

     

    Cash and cash equivalents

     

    $

    184,673

     

     

    $

    272,804

     

     

    $

    230,259

     

    Short-term marketable securities

     

     

    37,918

     

     

     

    30,002

     

     

     

    35,010

     

    Receivables, net

     

     

    700,387

     

     

     

    473,246

     

     

     

    618,070

     

    Contract assets

     

     

    233,925

     

     

     

    219,754

     

     

     

    213,989

     

    Inventories

     

     

    95,442

     

     

     

    88,623

     

     

     

    90,789

     

    Equity in construction joint ventures

     

     

    209,765

     

     

     

    282,229

     

     

     

    273,993

     

    Other current assets

     

     

    42,698

     

     

     

    48,731

     

     

     

    95,173

     

    Total current assets

     

     

    1,504,808

     

     

     

    1,415,389

     

     

     

    1,557,283

     

    Property and equipment, net

     

     

    542,796

     

     

     

    549,688

     

     

     

    560,618

     

    Long-term marketable securities

     

     

    10,000

     

     

     

    36,098

     

     

     

    46,093

     

    Investments in affiliates

     

     

    84,914

     

     

     

    84,354

     

     

     

    84,840

     

    Goodwill

     

     

    264,112

     

     

     

    259,471

     

     

     

    244,696

     

    Right of use assets

     

     

    70,472

     

     

     

     

     

     

     

    Deferred income taxes, net

     

     

    38,443

     

     

     

    2,918

     

     

     

    6,408

     

    Other noncurrent assets

     

     

    118,228

     

     

     

    128,683

     

     

     

    143,910

     

    Total assets

     

    $

    2,633,773

     

     

    $

    2,476,601

     

     

    $

    2,643,848

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    LIABILITIES AND EQUITY

     

     

     

     

     

     

     

     

     

     

     

     

    Current liabilities

     

     

     

     

     

     

     

     

     

     

     

     

    Current maturities of long-term debt

     

    $

    8,263

     

     

    $

    47,286

     

     

    $

    116,796

     

    Accounts payable

     

     

    399,528

     

     

     

    251,481

     

     

     

    316,917

     

    Contract liabilities

     

     

    106,010

     

     

     

    105,449

     

     

     

    117,759

     

    Accrued expenses and other current liabilities

     

     

    342,040

     

     

     

    273,626

     

     

     

    296,033

     

    Total current liabilities

     

     

    855,841

     

     

     

    677,842

     

     

     

    847,505

     

    Long-term debt

     

     

    394,841

     

     

     

    335,119

     

     

     

    316,926

     

    Lease liabilities

     

     

    56,740

     

     

     

     

     

     

     

    Deferred income taxes, net

     

     

    4,652

     

     

     

    4,317

     

     

     

    5,589

     

    Other long-term liabilities

     

     

    58,433

     

     

     

    61,689

     

     

     

    67,429

     

    Commitments and contingencies

     

     

     

     

     

     

     

     

     

     

     

     

    Equity

     

     

     

     

     

     

     

     

     

     

     

     

    Preferred stock, $0.01 par value, authorized 3,000,000 shares, none outstanding

     

     

     

     

     

     

     

     

     

    Common stock, $0.01 par value, authorized 150,000,000 shares; issued and outstanding: 46,741,263 shares as of September 30, 2019, 46,665,889 shares as of December 31, 2018 and 46,897,092 shares as of September 30, 2018

     

     

    468

     

     

     

    467

     

     

     

    469

     

    Additional paid-in capital

     

     

    567,033

     

     

     

    564,559

     

     

     

    572,046

     

    Accumulated other comprehensive (loss) income

     

     

    (3,282

    )

     

     

    (749

    )

     

     

    1,841

     

    Retained earnings

     

     

    656,487

     

     

     

    787,356

     

     

     

    786,936

     

    Total Granite Construction Incorporated shareholders’ equity

     

     

    1,220,706

     

     

     

    1,351,633

     

     

     

    1,361,292

     

    Non-controlling interests

     

     

    42,560

     

     

     

    46,001

     

     

     

    45,107

     

    Total equity

     

     

    1,263,266

     

     

     

    1,397,634

     

     

     

    1,406,399

     

    Total liabilities and equity

     

    $

    2,633,773

     

     

    $

    2,476,601

     

     

    $

    2,643,848

     

    GRANITE CONSTRUCTION INCORPORATED

    CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

    (Unaudited - in thousands, except per share data)

     

     

     

     

     

     

     

     

     

    Three Months Ended September 30,

     

     

    Nine Months Ended September 30,

     

     

     

    2019

     

     

    2018

     

     

    2019

     

     

    2018

     

    Revenue

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

    $

    598,646

     

     

    $

    610,847

     

     

    $

    1,340,834

     

     

    $

    1,472,703

     

    Water

     

     

    135,908

     

     

     

    124,292

     

     

     

    347,994

     

     

     

    215,951

     

    Specialty

     

     

    224,457

     

     

     

    190,836

     

     

     

    540,234

     

     

     

    461,149

     

    Materials

     

     

    129,099

     

     

     

    129,616

     

     

     

    268,389

     

     

     

    276,286

     

    Total revenue

     

     

    1,088,110

     

     

     

    1,055,591

     

     

     

    2,497,451

     

     

     

    2,426,089

     

    Cost of revenue

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

     

    585,013

     

     

     

    539,871

     

     

     

    1,405,830

     

     

     

    1,334,302

     

    Water

     

     

    120,878

     

     

     

    100,189

     

     

     

    313,582

     

     

     

    174,834

     

    Specialty

     

     

    186,158

     

     

     

    162,737

     

     

     

    464,858

     

     

     

    395,838

     

    Materials

     

     

    104,629

     

     

     

    108,303

     

     

     

    233,675

     

     

     

    239,972

     

    Total cost of revenue

     

     

    996,678

     

     

     

    911,100

     

     

     

    2,417,945

     

     

     

    2,144,946

     

    Gross profit

     

     

    91,432

     

     

     

    144,491

     

     

     

    79,506

     

     

     

    281,143

     

    Selling, general and administrative expenses

     

     

    73,424

     

     

     

    70,769

     

     

     

    224,577

     

     

     

    193,337

     

    Acquisition and integration expenses

     

     

    2,744

     

     

     

    9,334

     

     

     

    15,244

     

     

     

    44,030

     

    Gain on sales of property and equipment

     

     

    (7,101

    )

     

     

    (3,018

    )

     

     

    (13,936

    )

     

     

    (5,066

    )

    Operating income (loss)

     

     

    22,365

     

     

     

    67,406

     

     

     

    (146,379

    )

     

     

    48,842

     

    Other (income) expense

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Interest income

     

     

    (1,713

    )

     

     

    (1,533

    )

     

     

    (6,257

    )

     

     

    (4,227

    )

    Interest expense

     

     

    4,839

     

     

     

    4,452

     

     

     

    13,011

     

     

     

    10,090

     

    Equity in income of affiliates

     

     

    (6,275

    )

     

     

    (1,769

    )

     

     

    (10,159

    )

     

     

    (5,527

    )

    Other expense (income), net

     

     

    127

     

     

     

    (1,533

    )

     

     

    (2,394

    )

     

     

    (2,205

    )

    Total other income

     

     

    (3,022

    )

     

     

    (383

    )

     

     

    (5,799

    )

     

     

    (1,869

    )

    Income (loss) before provision for (benefit from) income taxes

     

     

    25,387

     

     

     

    67,789

     

     

     

    (140,580

    )

     

     

    50,711

     

    Provision for (benefit from) income taxes

     

     

    3,474

     

     

     

    8,692

     

     

     

    (37,451

    )

     

     

    7,357

     

    Net income (loss)

     

     

    21,913

     

     

     

    59,097

     

     

     

    (103,129

    )

     

     

    43,354

     

    Amount attributable to non-controlling interests

     

     

    (1,425

    )

     

     

    (3,425

    )

     

     

    (8,793

    )

     

     

    (7,490

    )

    Net income (loss) attributable to Granite Construction Incorporated

     

    $

    20,488

     

     

    $

    55,672

     

     

    $

    (111,922

    )

     

    $

    35,864

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Net income (loss) per share attributable to common shareholders

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Basic

     

    $

    0.44

     

     

    $

    1.20

     

     

    $

    (2.39

    )

     

    $

    0.84

     

    Diluted

     

    $

    0.43

     

     

    $

    1.17

     

     

    $

    (2.39

    )

     

    $

    0.84

     

    Weighted average shares of common stock

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Basic

     

     

    46,788

     

     

     

    46.308

     

     

     

    46,771

     

     

     

    42,443

     

    Diluted

     

     

    47,170

     

     

     

    47,810

     

     

     

    46,771

     

     

     

    42,910

     

    GRANITE CONSTRUCTION INCORPORATED

    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

    (Unaudited - in thousands)

     

     

     

     

     

     

     

    Nine Months Ended September 30,

     

    2019

     

     

    2018

     

    Operating activities

     

     

     

     

     

     

     

     

    Net (loss) income

     

    $

    (103,129

    )

     

    $

    43,354

     

    Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:

     

     

     

     

     

     

     

     

    Depreciation, depletion and amortization

     

     

    92,700

     

     

     

    77,816

     

    Gain on sales of property and equipment, net

     

     

    (13,936

    )

     

     

    (5,066

    )

    Change in deferred income taxes

     

     

    (37,338

    )

     

     

    (2,207

    )

    Stock-based compensation

     

     

    8,924

     

     

     

    12,621

     

    Equity in net loss from unconsolidated joint ventures

     

     

    173,008

     

     

     

    16,343

     

    Net income from affiliates

     

     

    (10,159

    )

     

     

    (5,527

    )

    Other non-cash adjustments

     

     

    4,630

     

     

     

     

    Changes in assets and liabilities, net of the effects of acquisitions:

     

     

    (141,198

    )

     

     

    (122,591

    )

    Net cash (used in) provided by operating activities

     

     

    (26,498

    )

     

     

    14,743

     

    Investing activities

     

     

     

     

     

     

     

     

    Purchases of marketable securities

     

     

     

     

     

    (9,952

    )

    Maturities of marketable securities

     

     

    20,000

     

     

     

    60,000

     

    Purchases of property and equipment

     

     

    (83,329

    )

     

     

    (86,131

    )

    Proceeds from sales of property and equipment

     

     

    28,104

     

     

     

    9,480

     

    Cash paid to purchase businesses, net of cash and restricted cash acquired

     

     

    (6,227

    )

     

     

    (55,030

    )

    Other investing activities, net

     

     

    (3,756

    )

     

     

    320

     

    Net cash used in investing activities

     

     

    (45,208

    )

     

     

    (81,313

    )

    Financing activities

     

     

     

     

     

     

     

     

    Proceeds from debt

     

     

    105,574

     

     

     

    143,250

     

    Debt principal repayments

     

     

    (86,018

    )

     

     

    (42,149

    )

    Cash dividends paid

     

     

    (18,240

    )

     

     

    (16,328

    )

    Repurchases of common stock

     

     

    (6,916

    )

     

     

    (6,369

    )

    Distributions to non-controlling partners, net

     

     

    (12,234

    )

     

     

    (10,128

    )

    Other financing activities, net

     

     

    1,242

     

     

     

    441

     

    Net cash (used in) provided by financing activities

     

     

    (16,592

    )

     

     

    68,717

     

    Net (decrease) increase in cash, cash equivalents and restricted cash

     

     

    (88,298

    )

     

     

    2,147

     

    Cash, cash equivalents and $5,825 and $0 in restricted cash at beginning of each period

     

     

    278,629

     

     

     

    233,711

     

    Cash, cash equivalents and $5,658 and $5,599 in restricted cash at end of each period

     

    $

    190,331

     

     

    $

    235,858

     

    GRANITE CONSTRUCTION INCORPORATED

    Business Segment Information

    (Unaudited - dollars in thousands)

     

     

    Three Months Ended
    September 30,

     

     

    Nine Months Ended
    September 30,

     

     

     

    2019

     

     

    2018

     

     

    2019

     

     

    2018

     

    Revenue

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

    $

    598,646

     

     

    $

    610,847

     

     

    $

    1,340,834

     

     

    $

    1,472,703

     

    Water

     

     

    135,908

     

     

     

    124,292

     

     

     

    347,994

     

     

     

    215,951

     

    Specialty

     

     

    224,457

     

     

     

    190,836

     

     

     

    540,234

     

     

     

    461,149

     

    Materials

     

     

    129,099

     

     

     

    129,616

     

     

     

    268,389

     

     

     

    276,286

     

    Total revenue

     

    $

    1,088,110

     

     

    $

    1,055,591

     

     

    $

    2,497,451

     

     

    $

    2,426,089

     

    Gross profit (loss)

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

    $

    13,633

     

     

    $

    70,976

     

     

    $

    (64,996

    )

     

    $

    138,401

     

    Water

     

     

    15,030

     

     

     

    24,103

     

     

     

    34,412

     

     

     

    41,117

     

    Specialty

     

     

    38,299

     

     

     

    28,099

     

     

     

    75,376

     

     

     

    65,311

     

    Materials

     

     

    24,470

     

     

     

    21,313

     

     

     

    34,714

     

     

     

    36,314

     

    Total gross profit

     

    $

    91,432

     

     

    $

    144,491

     

     

    $

    79,506

     

     

    $

    281,143

     

    Gross profit (loss) as a percent of revenue

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

     

    2.3

    %

     

     

    11.6

    %

     

     

    (4.8

    %)

     

     

    9.4

    %

    Water

     

     

    11.1

     

     

     

    19.4

     

     

     

    9.9

     

     

     

    19.0

     

    Specialty

     

     

    17.1

     

     

     

    14.7

     

     

     

    14.0

     

     

     

    14.2

     

    Materials

     

     

    19.0

     

     

     

    16.4

     

     

     

    12.9

     

     

     

    13.1

     

    Total gross profit as a percent of total revenue

     

     

    8.4

    %

     

     

    13.7

    %

     

     

    3.2

    %

     

     

    11.6

    %

    GRANITE CONSTRUCTION INCORPORATED

    Committed and Awarded Projects

    (Unaudited - dollars in thousands)

     

     

    September 30,
    2019

     

     

    June 30,
    2019

     

     

    September 30,
    2018

     

    Unearned revenue

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

    $

    2,628,575

     

     

     

    73.2

     

    $

    2,921,437

     

     

     

    79.1

     

    $

    2,311,712

     

     

     

    75.5

    %

    Water

     

     

    231,551

     

     

     

    6.4

     

     

     

    253,418

     

     

     

    6.9

     

     

     

    250,157

     

     

     

    8.2

     

    Specialty

     

     

    733,075

     

     

     

    20.4

     

     

     

    517,457

     

     

     

    14.0

     

     

     

    501,556

     

     

     

    16.4

     

    Total unearned revenue

     

     

    3,593,201

     

     

     

    100.0

     

     

     

    3,692,312

     

     

     

    100.0

     

     

     

    3,063,425

     

     

     

    100.0

     

    Other awards(1)

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

     

    25,224

     

     

     

    48.5

     

     

     

    18,290

     

     

     

    14.7

     

     

     

     

     

     

    0.0

     

    Water

     

     

    13,306

     

     

     

    25.6

     

     

     

    64,693

     

     

     

    51.8

     

     

     

    114,615

     

     

     

    64.5

     

    Specialty

     

     

    13,487

     

     

     

    25.9

     

     

     

    41,807

     

     

     

    33.5

     

     

     

    63,095

     

     

     

    35.5

     

    Total other awards

     

     

    52,017

     

     

     

    100.0

     

     

     

    124,790

     

     

     

    100.0

     

     

     

    177,710

     

     

     

    100.0

     

    Total Contract Backlog(2)

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

     

    2,653,799

     

     

     

    72.8

     

     

     

    2,939,727

     

     

     

    77.0

     

     

     

    2,311,712

     

     

     

    71.3

     

    Water

     

     

    244,857

     

     

     

    6.7

     

     

     

    318,111

     

     

     

    8.3

     

     

     

    364,772

     

     

     

    11.3

     

    Specialty

     

     

    746,562

     

     

     

    20.5

     

     

     

    559,264

     

     

     

    14.7

     

     

     

    564,651

     

     

     

    17.4

     

    Total contract backlog(2)

     

     

    3,645,218

     

     

     

    100.0

     

     

     

    3,817,102

     

     

     

    100.0

     

     

     

    3,241,135

     

     

     

    100.0

     

    Alternative procurement work(3)

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

     

    1,038,780

     

     

     

    100.0

     

     

     

    1,055,751

     

     

     

    100.0

     

     

     

     

     

     

     

    Water

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Specialty

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Total alternative procurement work(3)

     

     

    1,038,780

     

     

     

    100.0

     

     

     

    1,055,751

     

     

     

    100.0

     

     

     

     

     

     

     

    Committed and Awarded Projects

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transportation

     

     

    3,692,579

     

     

     

    78.8

     

     

     

    3,995,478

     

     

     

    82.0

     

     

     

    2,311,712

     

     

     

    71.3

     

    Water

     

     

    244,857

     

     

     

    5.2

     

     

     

    318,111

     

     

     

    6.5

     

     

     

    364,772

     

     

     

    11.3

     

    Specialty

     

     

    746,562

     

     

     

    15.9

     

     

     

    559,264

     

     

     

    11.5

     

     

     

    564,651

     

     

     

    17.4

     

    Total Committed and Awarded Projects

     

    $

    4,683,998

     

     

     

    100.0

     

    $

    4,872,853

     

     

     

    100.0

    %

     

    $

    3,241,135

     

     

     

    100.0

    (1) Other awards include unissued task orders and unexercised contract options to the extent their issuance or exercise is probable as well as contract awards to the extent we believe contract execution and funding is probable.

    (2) Contract Backlog is calculated by adding Unearned Revenue and Other Awards.

    (3) Alternative Procurement Work represents Construction Manager/General Contractor projects that will enter backlog as task orders are issued in 2019 and over the next few years.

    Non-GAAP Financial Information

    The tables below contain financial information calculated other than in accordance with U.S. generally accepted accounting principles (“GAAP”). Specifically, management believes that non-GAAP financial measures such as EBITDA and EBITDA margin are useful in evaluating operating performance and are regularly used by securities analysts, institutional investors and other interested parties, and that such supplemental measures facilitate comparisons between companies that have different capital and financing structures and/or tax rates. We are also providing additional non-GAAP financial measures, including adjusted EBITDA, adjusted EBITDA margin, adjusted loss before (benefit from) provision for income taxes, adjusted benefit from (provision for) income taxes, adjusted net (loss) income attributable to Granite Construction Incorporated and adjusted diluted net (loss) income per share to indicate the impact of non-recurring acquisition, integration, acquired intangible amortization expenses, acquisition related depreciation and synergy costs (collectively referred to as “transaction costs”) related to the acquisition of the Layne Christensen Company and LiquiForce. Acquisition and integration costs include external transaction costs, professional fees and internal travel. Synergy costs include expenses incurred which will be eliminated as the integration of Layne and LiquiForce is completed.

    Management believes that these additional non-GAAP financial measures facilitate comparisons between securities analysts, institutional investors and other interested parties. However, the reader is cautioned that any non-GAAP financial measures provided by the Company are provided in addition to, and not as alternatives for, the Company's reported results prepared in accordance with GAAP. Items that may have a significant impact on the Company's financial position, results of operations and cash flows must be considered when assessing the Company's actual financial condition and performance regardless of whether these items are included in non-GAAP financial measures. The methods used by the Company to calculate its non-GAAP financial measures may differ significantly from methods used by other companies to compute similar measures. As a result, any non-GAAP financial measures provided by the Company may not be comparable to similar measures provided by other companies. The Company does not provide a reconciliation of forward-looking adjusted EBITDA margin to the most directly comparable forward-looking GAAP measure of net income (loss) attributable to Granite Construction Incorporated because the timing and amount of the excluded items are unreasonably difficult to fully and accurately estimate.

    GRANITE CONSTRUCTION INCORPORATED

    EBITDA(1)

    (Unaudited - dollars in thousands)

     

     

    Three Months Ended September 30,

     

     

    Nine Months Ended September 30,

     

     

     

    2019

     

     

    2018

     

     

    2019

     

     

    2018

     

    Net income (loss) attributable to Granite Construction Incorporated

     

    $

    20,488

     

     

    $

    55,672

     

     

    $

    (111,922

    )

     

    $

    35,864

     

    Depreciation, depletion and amortization expense(2)

     

     

    30,953

     

     

     

    34,269

     

     

     

    92,700

     

     

     

    77,816

     

    Provision for (benefit from) income taxes

     

     

    3,474

     

     

     

    8,692

     

     

     

    (37,451

    )

     

     

    7,357

     

    Interest expense, net of interest income

     

     

    3,126

     

     

     

    2,919

     

     

     

    6,754

     

     

     

    5,863

     

    EBITDA(1)

     

    $

    58,041

     

     

    $

    101,552

     

     

    $

    (49,919

    )

     

    $

    126,900

     

    EBITDA margin(3)

     

     

    5.3

    %

     

     

    9.6

    %

     

     

    (2.0

    %)

     

     

    5.2

    %

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Transaction costs

     

    $

    3,294

     

     

    $

    11,190

     

     

    $

    17,608

     

     

    $

    46,037

     

    Adjusted EBITDA(1)

     

    $

    61,335

     

     

    $

    112,742

     

     

    $

    (32,311

    )

     

    $

    172,937

     

    Adjusted EBITDA margin(1)

     

     

    5.6

    %

     

     

    10.7

    %

     

     

    (1.3

    %)

     

     

    7.1

    %

    (1) We define EBITDA as GAAP net income (loss) attributable to Granite Construction Incorporated, adjusted for net interest expense, taxes, depreciation, depletion and amortization. Adjusted EBITDA and adjusted EBITDA margin exclude the impact of acquisition and integration expenses and synergies.

    (2) Amount includes the sum of depreciation, depletion and amortization which are classified as cost of revenue and selling, general and administrative expenses in the condensed consolidated statements of operations of Granite Construction Incorporated.

    (3) Represents EBITDA divided by consolidated revenue of $1.1 billion and $2.5 billion for the three and nine months ended September 30, 2019, respectively, and $1.1 billion and $2.4 billion for three and nine months ended September 30, 2018, respectively.

    GRANITE CONSTRUCTION INCORPORATED

    Adjusted Net Income (Loss) Reconciliation(1)

    (Unaudited - in thousands, except per share data)

     

     

     

     

     

     

     

     

     

    Three Months Ended September 30,

     

     

    Nine Months Ended September 30,

     

     

     

    2019

     

     

    2018

     

     

    2019

     

     

    2018

     

    Income (loss) before provision for (benefit from) income taxes

     

    $

    25,387

     

     

    $

    67,789

     

     

    $

    (140,580

    )

     

    $

    50,711

     

    Transaction costs

     

     

    9,537

     

     

     

    17,705

     

     

     

    36,802

     

     

     

    55,619

     

    Adjusted income (loss) before provision for (benefit from) income taxes

     

    $

    34,924

     

     

    $

    85,494

     

     

    $

    (103,778

    )

     

    $

    106,330

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Provision for (benefit from) income taxes

     

    $

    3,474

     

     

    $

    8,692

     

     

    $

    (37,451

    )

     

    $

    7,357

     

    Tax effect of the transaction costs(1)

     

     

    2,480

     

     

     

    5,498

     

     

     

    9,569

     

     

     

    10,461

     

    Adjusted provision for (benefit from) income taxes

     

    $

    5,954

     

     

    $

    14,190

     

     

    $

    (27,882

    )

     

    $

    17,818

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Net income (loss) attributable to Granite Construction Incorporated

     

    $

    20,488

     

     

    $

    55,672

     

     

    $

    (111,922

    )

     

    $

    35,864

     

    After-tax transaction costs

     

     

    7,057

     

     

     

    12,207

     

     

     

    27,233

     

     

     

    45,158

     

    Adjusted net income (loss) attributable to Granite Construction Incorporated

     

    $

    27,545

     

     

    $

    67,879

     

     

    $

    (84,689

    )

     

    $

    81,022

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

     

    Diluted net income (loss) per share attributable to common shareholders

     

    $

    0.43

     

     

    $

    1.17

     

     

    $

    (2.39

    )

     

    $

    0.84

     

    After-tax transaction costs

     

     

    0.15

     

     

     

    0.26

     

     

     

    0.58

     

     

     

    1.05

     

    Adjusted diluted net income (loss) per share attributable to common shareholders

     

    $

    0.58

     

     

    $

    1.43

     

     

    $

    (1.81

    )

     

    $

    1.89

     

    (1) The tax effect of transaction costs was calculated using the Company’s estimated annual statutory tax rate.

    Source: Granite Construction Incorporated



    Business Wire (engl.)
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    Granite Reports Third Quarter 2019 Results Granite Construction Incorporated (NYSE: GVA) today reported net income of $20.5 million ($0.43 per diluted share) for the quarter ended September 30, 2019, compared to net income of $55.7 million ($1.17 per diluted share) for the quarter ended …