ENGlobal Corp (NASDAQ:ENG) filed Quarterly Report for the period ended 2012-03-31.
Englobal Corp has a market cap of $54.6 million; its shares were traded at around $1.95 with and P/S ratio of 0.2.
Highlight of Business Operations:The Company recognizes service revenue as soon as the services are performed. For clients that we consider higher risk, due to past payment history or history of not providing written work authorizations, we defer revenue recognition until we receive either a written authorization or a payment. The current amount of revenue deferred for these reasons is approximately $1.7 million as of March 31, 2012, compared to $0.3 million as of December 31, 2011. We expect a majority of the deferred revenue amount to be realized by year end 2012.
Total stockholders' equity decreased 0.1%, or $0.1 million, from $58.5 million as of December 31, 2011 to $58.4 million as of March 31, 2012 due to prior year net losses in retained earnings, but offset by significant improvement in earnings compared to prior year-to-date earnings.
Our revenue is generally driven by the projects that we are currently working on. These projects vary significantly in size and quantity and primarily serve clients in the upstream, midstream and downstream sectors of the energy industry. Projects are bid and awarded based upon a large number of factors most of which are governed by our customers. Revenue for the three months ended March 31, 2012, as compared to the same period in 2011 increased approximately $6.2 million. The Engineering and Construction (“E&C”) and the Automation segments both experienced increased revenue while revenue declined in the Field Solutions segment. The E&C segment was awarded and performed projects for several major global energy companies. The Automation segment experienced an increase in revenue from the fabrication division of approximately $3.0 million due to projects with both diversified energy and power generation companies in addition to revenue generated from the CPC pipeline in the non-fab division. The Field Solutions segment experienced increased revenue in the Land division due to increased project activity with major midstream energy companies while the Inspection division experienced decreased revenue due to completion of the Ruby Pipeline project.
Gross profit for the three months ended March 31, 2012, as compared to the comparable 2011 period, increased by approximately $2.2 million, or a 41.7% increase. As a percentage of revenue, gross profit increased from 7.7% to 9.9% for the three months ended March 31, 2012, as compared to the same period in 2011.
The $1.1 million decrease in SG&A expense for the three months ended March 31, 2012, as compared to the same period for 2011, primarily resulted from reduced legal expenses of $1.2 million related to the settlement of a labor dispute that was recorded in the first quarter of 2011. As a percentage of revenue, SG&A expense decreased from 12.0% for the three months ended March 31,2012, to 9.6% for the comparable prior year period, which is a 2.4% decrease in the SG&A rate.
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