Gulf Island Fabrication Inc. (GIFI, Financial) filed Quarterly Report for the period ended 2009-06-30.
Gulf Island Fabrication Inc. together with its subsidiaries is a leading fabricator of offshore drilling and production platforms and other specialized structures used in the development and production of offshore oil and gas reserves. Gulf Island Fabrication Inc. has a market cap of $219.97 million; its shares were traded at around $15.39 with a P/E ratio of 15.87 and P/S ratio of 0.52. The dividend yield of Gulf Island Fabrication Inc. stocks is 0.26%. Gulf Island Fabrication Inc. had an annual average earning growth of 6.5% over the past 10 years.
Of our $159.2 million backlog at June 30, 2009, $27.4 million, or 17.2%, represented projects destined for deepwater locations compared to $50.4 million, or 24.0%, of projects destined for deepwater locations of the $209.8 million backlog at December 31, 2008. Included in the backlog are $1.2 million, or 0.7%, and $1.5 million, or 0.4%, at June 30, 2009 and December 31, 2008, respectively, related to projects destined for foreign locations.
At June 30, 2009, we recorded revenue totaling $1.4 million related to certain change orders on one project which has been approved as to scope but not price. Although we believe the collection of this change order is probable based on past experience, we are in the process of negotiating resolution of these change orders with the customer, and recovery of the revenue is dependent upon these negotiations. If we collect an amount different than the $1.4 million of revenue that has been recorded, that difference will be recognized as income or loss. We expect to resolve these matters in the third quarter of 2009. At December 31, 2008, we had $6.9 million of change orders related to re-measure issues primarily involving one customer. These issues have been settled and resulted in the recognition of an additional $400,000 of revenue.
For the three-month and six-month periods ended June 30, 2009, gross profit was $8.3 million (10.5% of revenue) and $20.1 million (12.2% of revenue), respectively, compared to $20.1 million (17.0% of revenue) and $43.3 million (17.9% of revenue), respectively, for the three-month and six-month periods ended June 30, 2008. Factors that contributed to the decrease in gross margin for the three-month and six-month periods ended June 30, 2009 include:
Bluewater will pay $48 million of the remaining amount owed to us pursuant to the assignment of all of its right, title and interest in the Conveyance of Overriding Royalty Interest between ATP and Bluewater. The interest we received from Bluewater is a limited overriding royalty interest because the amount to be received by us is set not to exceed $48 million. Upon cumulative receipt of the $48 million, the limited overriding royalty will revert back to Bluewater. It is projected that we will start receiving royalty payments from this overriding royalty interest in February 2010, and we anticipate the entire $48 million to be paid over a thirteen month period. The production volumes used in these projections were derived from petroleum engineering reserve reports. The prices for oil and gas were estimated based on the strip prices in effect in mid-June 2009.
At June 30, 2009, our cash and cash equivalents totaled $14.2 million. Working capital was $64.5 million at June 30, 2009. The ratio of current assets to current liabilities was 2.47 to 1 at June 30, 2009. Net cash provided by operating activities was $9.5 million for the six-months ended June 30, 2009, compared to $13.9 million provided by operating activities for the six-months ended June 30, 2008. The overall decrease in cash provided by operations for the period ended June 30, 2009, compared to the period ended June 30, 2008, is due to the following factors:
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Gulf Island Fabrication Inc. together with its subsidiaries is a leading fabricator of offshore drilling and production platforms and other specialized structures used in the development and production of offshore oil and gas reserves. Gulf Island Fabrication Inc. has a market cap of $219.97 million; its shares were traded at around $15.39 with a P/E ratio of 15.87 and P/S ratio of 0.52. The dividend yield of Gulf Island Fabrication Inc. stocks is 0.26%. Gulf Island Fabrication Inc. had an annual average earning growth of 6.5% over the past 10 years.
Highlight of Business Operations:
As of June 30, 2009, we had a revenue backlog of $159.2 million and a labor backlog of approximately 1.8 million man-hours remaining to work, which consist of work remaining at June 30, 2009 and commitments received through the second quarter earnings release issued July 23, 2009, compared to the revenue backlog of $209.8 million and a man-hour backlog of 2.3 million hours reported in our Form 10-K at December 31, 2008, both of which exclude the MinDOC II hull backlog of $147.7 million and 1.6 million man-hours and $150.4 million and 1.6 million man-hours, respectively. Although not formally cancelled, due to current economic conditions, it is not likely the MinDOC II project will return to active status in the near future.Of our $159.2 million backlog at June 30, 2009, $27.4 million, or 17.2%, represented projects destined for deepwater locations compared to $50.4 million, or 24.0%, of projects destined for deepwater locations of the $209.8 million backlog at December 31, 2008. Included in the backlog are $1.2 million, or 0.7%, and $1.5 million, or 0.4%, at June 30, 2009 and December 31, 2008, respectively, related to projects destined for foreign locations.
At June 30, 2009, we recorded revenue totaling $1.4 million related to certain change orders on one project which has been approved as to scope but not price. Although we believe the collection of this change order is probable based on past experience, we are in the process of negotiating resolution of these change orders with the customer, and recovery of the revenue is dependent upon these negotiations. If we collect an amount different than the $1.4 million of revenue that has been recorded, that difference will be recognized as income or loss. We expect to resolve these matters in the third quarter of 2009. At December 31, 2008, we had $6.9 million of change orders related to re-measure issues primarily involving one customer. These issues have been settled and resulted in the recognition of an additional $400,000 of revenue.
For the three-month and six-month periods ended June 30, 2009, gross profit was $8.3 million (10.5% of revenue) and $20.1 million (12.2% of revenue), respectively, compared to $20.1 million (17.0% of revenue) and $43.3 million (17.9% of revenue), respectively, for the three-month and six-month periods ended June 30, 2008. Factors that contributed to the decrease in gross margin for the three-month and six-month periods ended June 30, 2009 include:
Bluewater will pay $48 million of the remaining amount owed to us pursuant to the assignment of all of its right, title and interest in the Conveyance of Overriding Royalty Interest between ATP and Bluewater. The interest we received from Bluewater is a limited overriding royalty interest because the amount to be received by us is set not to exceed $48 million. Upon cumulative receipt of the $48 million, the limited overriding royalty will revert back to Bluewater. It is projected that we will start receiving royalty payments from this overriding royalty interest in February 2010, and we anticipate the entire $48 million to be paid over a thirteen month period. The production volumes used in these projections were derived from petroleum engineering reserve reports. The prices for oil and gas were estimated based on the strip prices in effect in mid-June 2009.
At June 30, 2009, our cash and cash equivalents totaled $14.2 million. Working capital was $64.5 million at June 30, 2009. The ratio of current assets to current liabilities was 2.47 to 1 at June 30, 2009. Net cash provided by operating activities was $9.5 million for the six-months ended June 30, 2009, compared to $13.9 million provided by operating activities for the six-months ended June 30, 2008. The overall decrease in cash provided by operations for the period ended June 30, 2009, compared to the period ended June 30, 2008, is due to the following factors:
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