UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
DC 20549
FORM 8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date
of report (Date of earliest event reported): May 9, 2013
GRANITE
CONSTRUCTION INCORPORATED
(Exact
Name of Registrant as Specified in Charter)
Delaware |
1-12911 |
77-0239383 |
(State or Other Jurisdiction |
(Commission |
(IRS Employer |
585 West Beach Street |
(Address of Principal Executive Offices) (Zip Code) |
Registrant’s
telephone number, including area code: (831) 724-1011
Check the
appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any
of the following provisions (see General Instructions A.2. below):
⃞ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
⃞ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
⃞ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
⃞ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02. Results of Operations and Financial Condition.
On May 9, 2013, Granite Construction Incorporated (the “Company”) issued a press release with respect to its earnings for the quarter ended March 31, 2013, a copy of which is attached as Exhibit 99.1 and incorporated herein by reference.
The information set forth is furnished pursuant to Item 2.02, “Results of Operations and Financial Condition” and shall not be deemed “filed” for purpose of Section 18 of the Securities Exchange Act of 1934, nor shall the information, including the Exhibit, be deemed incorporated by reference in any filing of the Company, except as shall be expressly set forth by specific reference in such filing.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits. The following exhibits are attached hereto and furnished herewith:
Exhibit |
Description |
99.1 |
Press Release of the Company, dated May 9, 2013 |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
GRANITE CONSTRUCTION INCORPORATED |
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By: |
/s/ Laurel J. Krzeminski |
Laurel J. Krzeminski |
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Senior Vice President and Chief Financial Officer |
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Date: |
May 9, 2013 |
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INDEX TO EXHIBITS
Exhibit |
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99.1 |
Press Release of the Company, dated May 9, 2013 |
Exhibit 99.1
Granite Reports First-Quarter 2013 Financial Results
WATSONVILLE, Calif.--(BUSINESS WIRE)--May 9, 2013--Granite Construction Incorporated (NYSE: GVA) today reported a net loss of $22.0 million, or $0.57 per diluted share, for the first quarter of 2013 compared with a net loss of $11.8 million, or $0.31 per diluted share, for the first quarter of 2012.
“As expected, we had strong backlog growth in the quarter driven by significant large project awards,” said James H. Roberts, Granite president and chief executive officer. “We remain very encouraged by the quality of our backlog and the opportunities to grow the company in 2013 and beyond. We are slated to bid approximately $13 billion of Large Project work over the next 12 months, of which Granite’s share would be approximately $6 billion.
“Our integration of Kenny is progressing well, meeting our expectations, and reinforcing the continued execution of our strategic plan. We are working successfully to expand our presence into targeted end-markets such as power delivery, water and wastewater infrastructure and tunneling, all of which have attractive long-term fundamentals.”
First-quarter 2013 Financial Results
Total Company
Construction
Large Project Construction
Construction Materials
Outlook and Guidance
“In the short-term, certain markets of our vertically integrated business continue to face challenges as capacity exceeds demand for both our construction services and construction materials. While we will not see a turnaround overnight, the fundamentals of our business remain extremely solid and our future is very bright,” Roberts said.
“As our 2013 guidance reflects, we anticipate growing the top line of our business by at least double digits. We also anticipate that Granite will continue to generate strong cash flow, allowing us to further implement our strategic long-term plan. Our solid Large Project portfolio has created significant opportunities to continue to grow this part of the business. In addition to leveraging Kenny’s existing capabilities and presence in the power, underground and tunnel markets, we are confident that a recovery in the private construction market will help drive significant long-term operational and financial performance.”
The Company’s guidance for 2013 is as follows: Construction segment revenues are expected to total $1.25 billion to $1.4 billion, with a corresponding gross profit margin of 8 percent to 10 percent. Large Project Construction segment revenues are expected to be in the range of $850 million to $1.05 billion, with a corresponding gross profit margin of 12 percent to 14 percent. Construction Materials revenues are expected to be $200 million to $230 million, with a corresponding gross profit margin of 6 percent to 9 percent.
Selling, general and administrative expenses are expected to be $210 million to $220 million for the year. Gains on sales of property and equipment are expected to be in the range of $10 million to $20 million, and net income attributable to non-controlling interest in joint ventures for the total company is expected to be $15 million to $20 million. Granite expects the tax rate for 2013 to be in the range of 27 percent to 31 percent, with planned capital expenditures of $40 million to $60 million. Cash flow from operations is expected to total between $80 million and $120 million for the year.
Conference Call
Granite will conduct a conference call today, May 9, 2013 at 8 a.m. Pacific Time/11 a.m. Eastern Time to discuss the results of the quarter ended March 31, 2013. Access to a live audio webcast is available at http://investor.graniteconstruction.com/index.cfm. The live conference call may be accessed by calling (877) 643-7158. The conference ID for the live call is 46628022. The call will be recorded and will be available for replay approximately two hours after the live audio webcast through May 16, 2013 by calling (855) 859-2056. The conference ID for the replay is also 46628022.
About Granite
Through its offices and subsidiaries nationwide, Granite Construction Incorporated (NYSE: GVA) is one of the nation’s largest infrastructure contractors and construction materials producers. Incorporated in 1922, Granite serves public- and private-sector clients on projects both small and large. Granite’s project teams represent some of the best in the industry serving owners in the transportation, power, federal, tunneling, underground, and industrial/mining and water resources markets. In 2013, the Company was recognized by the Ethisphere Institute as one of the World’s Most Ethical Companies for the fourth year in a row. For more information please visit www.graniteconstruction.com.
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, outcomes 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, outcomes 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) | ||||||||||||
March 31, | December 31, | March 31, | ||||||||||
2013 | 2012 | 2012 | ||||||||||
ASSETS | ||||||||||||
Current assets | ||||||||||||
Cash and cash equivalents | $ | 260,773 | $ | 321,990 | $ | 226,226 | ||||||
Short-term marketable securities | 44,841 | 56,088 | 70,444 | |||||||||
Receivables, net | 260,231 | 325,529 | 208,707 | |||||||||
Costs and estimated earnings in excess of billings | 48,428 | 34,116 | 49,962 | |||||||||
Inventories | 66,291 | 59,785 | 67,782 | |||||||||
Real estate held for development and sale | 50,303 | 50,223 | 58,363 | |||||||||
Deferred income taxes | 36,687 | 36,687 | 38,571 | |||||||||
Equity in construction joint ventures | 171,265 | 105,805 | 91,951 | |||||||||
Other current assets | 37,401 | 31,834 | 34,882 | |||||||||
Total current assets | 976,220 | 1,022,057 | 846,888 | |||||||||
Property and equipment, net | 477,666 | 481,478 | 442,132 | |||||||||
Long-term marketable securities | 57,958 | 55,342 | 70,114 | |||||||||
Investments in affiliates | 30,742 | 30,799 | 30,972 | |||||||||
Goodwill | 53,593 | 55,419 | 9,900 | |||||||||
Other noncurrent assets | 82,531 | 84,392 | 69,949 | |||||||||
Total assets | $ | 1,678,710 | $ | 1,729,487 | $ | 1,469,955 | ||||||
LIABILITIES AND EQUITY | ||||||||||||
Current liabilities | ||||||||||||
Current maturities of long-term debt | $ | 8,353 | $ | 8,353 | $ | 9,102 | ||||||
Current maturities of non-recourse debt | 4,132 | 10,707 | 19,765 | |||||||||
Accounts payable | 169,940 | 202,541 | 129,480 | |||||||||
Billings in excess of costs and estimated earnings | 124,609 | 139,692 | 87,370 | |||||||||
Accrued expenses and other current liabilities | 188,685 | 169,979 | 148,196 | |||||||||
Total current liabilities | 495,719 | 531,272 | 393,913 | |||||||||
Long-term debt | 270,148 | 270,148 | 208,501 | |||||||||
Long-term non-recourse debt | 7,628 | 922 | 1,371 | |||||||||
Other long-term liabilities | 49,231 | 47,124 | 50,011 | |||||||||
Deferred income taxes | 8,055 | 8,163 | 3,393 | |||||||||
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 38,810,255 shares as of March 31, 2013, 38,730,665 shares as of December 31, 2012 and 38,621,370 shares as of March 31, 2012 | 388 | 387 | 386 | |||||||||
Additional paid-in capital | 118,265 | 117,422 | 110,432 | |||||||||
Retained earnings | 685,023 | 712,144 | 670,462 | |||||||||
Total Granite Construction Incorporated shareholders’ equity | 803,676 | 829,953 | 781,280 | |||||||||
Noncontrolling interests | 44,253 | 41,905 | 31,486 | |||||||||
Total equity | 847,929 | 871,858 | 812,766 | |||||||||
Total liabilities and equity | $ | 1,678,710 | $ | 1,729,487 | $ | 1,469,955 |
GRANITE CONSTRUCTION INCORPORATED | ||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS | ||||||||||
(Unaudited - in thousands, except per share data) | ||||||||||
Three Months Ended March 31, | 2013 | 2012 | ||||||||
Revenue | ||||||||||
Construction | $ | 177,119 | $ | 117,946 | ||||||
Large Project Construction | 171,714 | 163,928 | ||||||||
Construction Materials | 29,750 | 25,623 | ||||||||
Real Estate | 121 | 2,663 | ||||||||
Total revenue | 378,704 | 310,160 | ||||||||
Cost of revenue | ||||||||||
Construction | 163,918 | 109,366 | ||||||||
Large Project Construction | 148,993 | 141,679 | ||||||||
Construction Materials | 35,724 | 31,573 | ||||||||
Real Estate | 11 | 2,606 | ||||||||
Total cost of revenue | 348,646 | 285,224 | ||||||||
Gross profit | 30,058 | 24,936 | ||||||||
Selling, general and administrative expenses | 57,659 | 45,090 | ||||||||
Gain on restructuring | 498 | 1,902 | ||||||||
Gain on sales of property and equipment | 1,087 | 1,917 | ||||||||
Operating loss | (26,016 | ) | (16,335 | ) | ||||||
Other (expense) income | ||||||||||
Interest income | 129 | 1,044 | ||||||||
Interest expense | (3,646 | ) | (3,182 | ) | ||||||
Equity in loss of affiliates | (423 | ) | (617 | ) | ||||||
Other income, net | 1,103 | 6,871 | ||||||||
Total other (expense) income | (2,837 | ) | 4,116 | |||||||
Loss before benefit from income taxes | (28,853 | ) | (12,219 | ) | ||||||
Benefit from income taxes | (9,027 | ) | (3,532 | ) | ||||||
Net loss | (19,826 | ) | (8,687 | ) | ||||||
Amount attributable to noncontrolling interests | (2,156 | ) | (3,086 | ) | ||||||
Net loss attributable to Granite Construction Incorporated | $ | (21,982 | ) | $ | (11,773 | ) | ||||
Net loss per share attributable to common shareholders: | ||||||||||
Basic | $ | (0.57 | ) | $ | (0.31 | ) | ||||
Diluted | $ | (0.57 | ) | $ | (0.31 | ) | ||||
Weighted average shares of common stock: | ||||||||||
Basic | 38,610 | 38,265 | ||||||||
Diluted | 38,610 | 38,265 |
GRANITE CONSTRUCTION INCORPORATED | ||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||||
(Unaudited - in thousands) | ||||||||||
Three Months Ended March 31, | 2013 | 2012 | ||||||||
Operating activities | ||||||||||
Net loss | $ | (19,826 | ) | $ | (8,687 | ) | ||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||||
Depreciation, depletion and amortization | 15,970 | 14,961 | ||||||||
Gain on sales of property and equipment | (1,087 | ) | (1,917 | ) | ||||||
Stock-based compensation | 5,386 | 4,196 | ||||||||
Changes in assets and liabilities | (55,096 | ) | (31,426 | ) | ||||||
Net cash used in operating activities | (54,653 | ) | (22,873 | ) | ||||||
Investing activities | ||||||||||
Purchases of marketable securities | (14,975 | ) | (24,987 | ) | ||||||
Maturities of marketable securities | 20,000 | 15,000 | ||||||||
Proceeds from sale of marketable securities | 5,000 | 20,000 | ||||||||
Additions to property and equipment | (9,956 | ) | (9,225 | ) | ||||||
Proceeds from sales of property and equipment | 3,417 | 2,883 | ||||||||
Other investing activities, net | (57 | ) | (294 | ) | ||||||
Net cash provided by investing activities | 3,429 | 3,377 | ||||||||
Financing activities | ||||||||||
Long-term debt principal payments | — | (2,500 | ) | |||||||
Cash dividends paid | (5,045 | ) | (5,021 | ) | ||||||
Purchase of common stock | (4,907 | ) | (3,837 | ) | ||||||
Other financing activities, net | (41 | ) | 90 | |||||||
Net cash used in financing activities | (9,993 | ) | (11,268 | ) | ||||||
Decrease in cash and cash equivalents | (61,217 | ) | (30,764 | ) | ||||||
Cash and cash equivalents at beginning of period | 321,990 | 256,990 | ||||||||
Cash and cash equivalents at end of period | $ | 260,773 | $ | 226,226 |
GRANITE CONSTRUCTION INCORPORATED | ||||||||||||||||||||
Business Segment Information | ||||||||||||||||||||
(Unaudited - dollars in thousands) | ||||||||||||||||||||
Three Months Ended March 31, | ||||||||||||||||||||
Large Project | Construction | |||||||||||||||||||
Construction | Construction | Materials | Real Estate | |||||||||||||||||
2013 | ||||||||||||||||||||
Revenue |
$ |
177,119 |
$ | 171,714 | $ | 29,750 | $ | 121 | ||||||||||||
Gross profit (loss) | 13,201 | 22,721 | (5,974 | ) | 110 | |||||||||||||||
Gross profit as a percent of revenue | 7.5 | % | 13.2 | % | (20.1 | )% | 90.9 | % | ||||||||||||
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2012 | ||||||||||||||||||||
Revenue | $ | 117,946 | $ | 163,928 | $ | 25,623 | $ | 2,663 | ||||||||||||
Gross profit (loss) | 8,580 | 22,249 | (5,950 | ) | 57 | |||||||||||||||
Gross profit as a percent of revenue | 7.3 | % | 13.6 | % | (23.2 | )% | 2.1 | % |
GRANITE CONSTRUCTION INCORPORATED | ||||||||||||||||||||||||
Contract Backlog by Segment | ||||||||||||||||||||||||
(Unaudited - dollars in thousands) | ||||||||||||||||||||||||
Contract Backlog by Segment | March 31, 2013 | December 31, 2012 | March 31, 2012 | |||||||||||||||||||||
Construction | $ | 740,259 | 30.8 | % | $ | 629,898 | 36.9 | % | $ | 622,240 | 29.9 | % | ||||||||||||
Large Project Construction | 1,660,056 | 69.2 | % | 1,077,417 | 63.1 | % | 1,460,674 | 70.1 | % | |||||||||||||||
Total | $ | 2,400,315 | 100.0 | % | $ | 1,707,315 | 100.0 | % | $ | 2,082,914 | 100.0 | % |
CONTACT:
Granite Construction Incorporated
Jacque Fourchy,
831-761-4741