Granite reports full-year, Q4 2010 results
Watsonville, Calif.-based Granite Construction Inc. on Feb. 23 reported a net loss of $59.0 million for the full year 2010, compared with net income of $73.5 million for the full year 2009. Loss per share for the year was $(1.56), compared with earnings per diluted share (EPS) of $1.90 in 2009.
For the fourth quarter of 2010, Granite reported a net loss of $50.0 million, compared with net income of $16.0 million for the fourth quarter of 2009.
Loss per share for the quarter ended Dec. 31, 2010 was $(1.32), compared with EPS of $0.41 earned in the prior year period. Included in the fourth quarter of 2010 were restructuring charges of $107.3 million associated with the company’s Enterprise Improvement Plan. The portion of restructuring charges attributable to noncontrolling interests was about $20.0 million.
“During the fourth quarter, we made solid progress towards reducing our cost structure and strengthening the business for the long-term,” Granite President and CEO James H. Roberts said in a written statement. “In addition to the necessary but difficult decision to reduce our workforce, we are focusing on optimizing our core business and have committed to divesting of our real estate investment business over the next three years.”
Roberts continued, “We are undoubtedly operating in one of the most difficult economic environments our company has faced in decades. Despite these challenges, we grew backlog in both of our key segments, maintained a solid balance sheet, and continued to position the company to recapture momentum in 2011.”
Full-year 2010 financial results
- Revenue totaled $1.8 billion, compared with $2.0 billion in 2009.
- Gross profit margin was 10 percent compared with 18 percent in 2009 due primarily to lower margins in our beginning backlog of work, compared with a year ago. Also contributing to margin pressure was $156.7 million in revenue from projects that had not yet reached the profit recognition threshold, compared with $68.8 million a year ago.
- Operating loss for the year was $109.3 million, compared with operating income of $129.2 million in the prior year and includes restructuring charges of $109.3 million.
- SG&A expenses were $191.6 million, compared with $228.0 million for the same period last year driven by reductions in salaries and related expenses, incentive compensation, and discretionary spending.
- Amount attributable to noncontrolling interests was a loss of $3.5 million, compared with income of $26.7 million in 2009 due to $20.0 million associated with the impairment charges taken in the fourth quarter 2010.
- Total contract backlog at December 31, 2010 was $1.9 billion, compared with $1.4 billion at December 31, 2009.
- Construction revenue for the full year totaled $943.2 million, compared with $1.2 billion for the same period in 2009 due to a continued weak demand in the private-sector and increased competition for public-sector work.
- Gross profit margin for the full year was 10 percent, compared with 18 percent for the same period in 2009, driven by lower volumes and increased competition.
Large Project Construction
- Large Project Construction revenue for the full year totaled $584.4 million, compared with $603.5 million for the same period last year.
- Gross profit margin for the full year decreased to 12 percent, compared with 20 percent for the same period last year as several new projects generated revenue, but did not reach the profit recognition threshold in 2010.
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