Furmanite Corporation Reports First Quarter 2014 Results

Furmanite Corporation Reports First Quarter 2014 Results

Revenues increase $35.9 million, or 40.3%, to $124.9 million;

Operating income of $2.5 million;

Net income of $1.0 million, $0.03 diluted earnings per share

HOUSTON–(BUSINESS WIRE)–May 5, 2014– Furmanite Corporation (NYSE: FRM) today reported results for the quarter endedMarch 31, 2014.

First Quarter 2014 Results

Revenues for the three months ended March 31, 2014 were $124.9 million, an increase of $35.9 million, or 40.3%, over the $89.0 million reported for the three months ended March 31, 2013. Operating income for the three months ended March 31, 2014 was $2.5 million compared to $4.1 million for the three months ended March 31, 2013, a decrease of $1.6 million. Foreign currency effects on both revenues and operating income were insignificant for the three months ended March 31, 2014. Net income for the 2014 first quarter was $1.0 million, or $0.03 per diluted share, compared to $2.6 million, or $0.07 per diluted share, in the 2013 first quarter.

Charles R. Cox, Chairman and CEO of Furmanite Corporation said, “We are pleased that we were able to mitigate somewhat the financial impact of the ‘Polar Vortex’ and still report both a profitable quarter and our best ever first quarter revenue performance! We remain fully committed to all aspects of our long-term transformation of Furmanite, and see strong indications that our Orange Way‘one single global team’ concept is now taking firm hold beyond the Americas region.”

Joseph Milliron, Furmanite President and COO, added, “As indicated in our March release, we experienced weather-related deferrals and disruptions in the Americas with a significant resulting impact on both revenue and labor utilization. In spite of this weather impact, the global revenues from our Technical Services segment increased by 5% over the first quarter of 2013, fueled by strong results from our EMEA region where revenues increased $6.9 million, or 34%, and operating income was up $2.6 million over the same period last year.” Mr. Milliron continued, “We are finding many synergies with our new Engineering & Project Solutions team and are focused on leveraging the whole new range of opportunities they have brought to Furmanite. We are also pleased with the year-to-date financial progress in this segment, with an 8% increase in revenue as well as a $0.7 million operating improvement, excluding integration costs, as compared to the fourth quarter of 2013. We remain confident of continued profitability improvements within this segment, along with growing reciprocal synergistic impacts on our Technical Services business going forward.”

Mr. Cox concluded, “The key question before us regarding 2014 is how much of the ground we lost in the first quarter can be made up in the remaining nine months! While the second quarter has started off very strong, and we see indications of this strength continuing, we have somewhat moderated our full year earnings per share guidance until we gain at least another quarter of both market visibility and more definitive financial results.”

Financial Position

As of March 31, 2014, the Company’s cash balance was $29.8 million. The Company’s cash balance, along with the $38.7 million of availability under its credit facility, provides the Company liquidity of $68.5 million.

Earnings Guidance

The Company reiterates its previously issued 2014 revenue guidance, with annual revenues for 2014 expected to be in the range of$540 million to $560 million, however it is revising its net income available to common shareholders estimate, which in light of the events of the first quarter, is expected to be in the range of $0.45 to $0.50 per diluted share.

Conference Call Details

In conjunction with the earnings release, Furmanite Corporation will host a conference call with Charles R. Cox (Chairman and CEO),Joseph E. Milliron (President and COO) and Robert S. Muff (Chief Financial Officer). The call will begin at 10:00 a.m. (Eastern) / 9:00 a.m. (Central) on Monday, May 5, 2014.


Furmanite Corporation (NYSE: FRM), founded in 1920, is one of the world’s largest specialty industrial services and specialty engineering project solutions companies, providing world class solutions to customer needs through more than 80 offices on six continents. The Company delivers a wide portfolio of inspection, mechanical and engineering services which help monitor, maintain, renew and construct the global energy, industrial and municipal infrastructures. Furmanite serves a broad range of industry sectors, including refining, offshore, sub-sea, pipeline, power generation, chemical, petrochemical, pulp and paper, water utilities, automotive, mining, marine and steel manufacturing. World Headquarters and Global Support Operations are located in Houston, Texas;Rotterdam, Netherlands; Kendal, United Kingdom and Melbourne, Australia. For more information, visit www.furmanite.com

Certain of the Company’s statements in this press release are not purely historical, and as such are “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements regarding management’s intentions, plans, beliefs, expectations or projections of the future. Forward-looking statements involve risks and uncertainties, including without limitation, the various risks inherent in the Company’s business, and other risks and uncertainties detailed most recently in this earnings release and the Company’s Form 10-K as of December 31, 2013 filed with the Securities and Exchange Commission. One or more of these factors could affect the Company’s business and financial results in future periods, and could cause actual results to differ materially from plans and projections. There can be no assurance that the forward-looking statements made in this document will prove to be accurate, and issuance of such forward-looking statements should not be regarded as a representation by the Company, or any other person, that the objectives and plans of the Company will be achieved. All forward-looking statements made in this press release are based on information presently available to management, and the Company assumes no obligation to update any forward-looking statements.

(in thousands, except per share data)
For the Three Months
Ended March 31,
2014 2013
Revenues $ 124,941 $ 89,038
Costs and expenses:
Operating costs 94,702 62,731
Depreciation and amortization expense 2,989 2,829
Selling, general and administrative expense 24,732 19,400
Total costs and expenses 122,423 84,960
Operating income 2,518 4,078
Interest income and other income (expense), net (165 ) 329
Interest expense (449 ) (278 )
Income before income taxes 1,904 4,129
Income tax expense (888 ) (1,565 )
Net income $ 1,016 $ 2,564
Earnings per common share – Basic $ 0.03 $ 0.07
Earnings per common share – Diluted $ 0.03 $ 0.07
Weighted-average number of common and common equivalent shares used in computing earnings per common share:
Basic 37,567 37,341
Diluted 37,827 37,595
EBITDA1 $ 5,342 $ 7,236
Reconciliation of EBITDA to Net income:
EBITDA $ 5,342 $ 7,236
Depreciation and amortization expense (2,989 ) (2,829 )
Interest expense (449 ) (278 )
Income tax expense (888 ) (1,565 )
Net income $ 1,016 $ 2,564


1Earnings before interest, taxes, depreciation and amortization (“EBITDA”) presented above is a financial measurement not calculated in accordance with generally accepted accounting principles in the United States (“GAAP”). A reconciliation of EBITDA to the most directly comparable GAAP measure is presented above. The Company believes that investors and other users of the financial statements benefit from the presentation of this non-GAAP measurement because it provides an additional metric to evaluate the Company’s core operating performance by excluding the effects of depreciation and amortization expense, interest expense and income tax expense from net income.

(in thousands)
March 31, December 31,
2014 2013
Cash $ 29,807 $ 33,240
Trade receivables, net 106,892 106,853
Inventories 39,450 35,443
Other current assets 21,542 21,159
Total current assets 197,691 196,695
Property and equipment, net 54,810 55,347
Other assets 32,349 33,125
Total assets $ 284,850 $ 285,167
Total current liabilities $ 61,298 $ 62,523
Total long-term debt 62,732 63,196
Other liabilities 25,518 25,952
Total stockholders’ equity 135,302 133,496
Total liabilities and stockholders’ equity $ 284,850 $ 285,167
(in thousands)
For the Three Months Ended
March 31,
2014 2013
Net income $ 1,016 $ 2,564
Depreciation, amortization and other non-cash items 2,823 4,003
Working capital changes (4,953 ) (9,909 )
Net cash used in operating activities (1,114 ) (3,342 )
Capital expenditures (1,679 ) (2,613 )
Acquisition of businesses (905 )
Proceeds from sale of assets 12
Payments on debt (909 ) (1,449 )
Issuance of common stock 14
Other (140 )
Effect of exchange rate changes on cash 395 (534 )
Decrease in cash and cash equivalents (3,433 ) (8,831 )
Cash and cash equivalents at beginning of period 33,240 33,185
Cash and cash equivalents at end of period $ 29,807 $ 24,354
(in thousands)
Engineering &
Corporate1 Total
Three months ended March 31, 2014
Revenues from external customers $ 87,750 $ 37,191 $ $ 124,941
Operating income (loss)2 $ 7,665 $ (757 ) $ (4,390 ) $ 2,518
Three months ended March 31, 2013
Revenues from external customers $ 83,793 $ 5,245 $ $ 89,038
Operating income (loss) $ 8,643 $ 43 $ (4,608 ) $ 4,078


1 Corporate represents certain corporate overhead costs, including executive management, strategic planning, treasury, legal, human resources, information technology, accounting and risk management, which are not allocated to reportable segments.

2 For the Engineering & Project Solutions segment, includes approximately $0.2 million of costs associated with the integration of the Furmanite Technical Solutions division for the three months ended March 31, 2014.

Source: Furmanite Corporation

Furmanite Corporation
Charles R. Cox, 713-634-7775 (Investor Relations)

111130-Leak Sealing-Sub Sea Clamp

On-Line Leak Sealing

Our leak-sealing technology and unrivaled
on-site service help you maximize asset uptime
by sealing leaks online, onsite and under pressure. This means you keep producing the ‘product’ while we solve your leak problems.

Discover More
Process Piping System Hot Tap

Hot Tapping

At Furmanite we carry the largest and most diverse inventory of Hot Tapping equipment
in the world. We have a proven record of developing unique and custom Hot Tap solutions for the most complicated scenarios.

Discover More
111130-Line Stopping

Line Stopping & Plugging

Our Line Stopping services help prevent unwanted shutdowns and keep critical piping
and pipeline systems online during tie-ins, relocations, repairs, retrofits and routine maintenance.

Discover More
111130-On-Site Machining

On-Site Machining

Our portable machining tools deliver the benefits of a fully equipped machine workshop on-site – where our clients need it most. We consistently achieve tolerances and finishes usually only achievable in a machine shop.

Discover More
111202-Self Leveling Machines

Self Leveling Machines

Furmanite’s Self Leveling Machines deliver precision on-site machining for large circular and irregular shaped surfaces. Our circular and linear machining equipment is portable and ready for global deployment.

Discover More
111130-Composite Repair-Absailing

Composite Repair

Our range of composite repair solutions is designed to ensure the ongoing structural integrity and load-bearing capabilities of your assets, improving their longevity whilst minimizing the impact on your productivity.

Discover More
111202-Heat Treatment-3

Post Weld Heat Treatment

Furmanite offers a full range of heat treatment services through a wide range of temperatures. We manufacture, own and operate the most technologically advanced heat treatment equipment available in the marketplace.

Discover More
111202-All Services-Steam

All Services

We offer a comprehensive range of on-site
and on-line plant and pipeline maintenance services. From standard applications to highly customized solutions our goal is to help you maximize your asset up time.

Discover More
111201-Hot Tapping Machine

Hot Tapping

Furmanite has been manufacturing Hot Tapping equipment for over 50 years. Our Hot Tapping Machines ensure your critical piping systems maintain a continuous flow while installing new tie-ins and branch connections.

Discover More
111201-Line Stopping

Line Stopping & Plugging

For over 50 years Furmanite’s Line Plugging equipment has been helping clients maintain a continuous flow on critical piping systems while performing repairs, relocations, valve or pump installations and pipe modifications.

Discover More
111201-Pipeline Repair

Pipeline Repair Products

We have a wide range of Pipeline Repair
and Integrity products designed to handle emergency leak repairs in high pressure environments and improve the structural integrity and safety of your pipelines.

Discover More
111201-Silk Machine

Portable Machining Tools

Furmanite’s Silk portable and lightweight machine tools provide high tolerance solutions for a variety of problems. Renowned for their sound engineering, our Silk machines help you deliver precision onsite machining.

Discover More

Valve Products

The Wilson Snyder Switch Valve has provided proven reliability for over 80 years in Coker Switch Valve applications. Wilson Snyder Switch Valves have the lowest steam consumption in the industry.

Discover More

Health & Safety Products

We offer a wide range of proprietary Safety, Environmental and Maintenance products designed to eliminate injuries and improve pipeline safety. At Furmanite, your ongoing safety is our number one priority.

Discover More
111201-Smart Shim

Chocking Prevention

Furmanite’s SmartShim™ is a truly effective and state-of-the-art conductor analysis and chocking solution that will ensure your offshore production site remains productive, powerful and profitable.

Discover More
111201-Valve Products

All Products

Furmanite has been a trusted resource for sophisticated engineering products for over
75 years. From Hot Tapping to Line Stopping, we have a wide range of products to meet your pipeline repair and maintenance needs.

Discover More


Furmanite is a world leader in the provision of on site services to clients in the mining, petro-chemical, off shore, oil & gas, powergen, marine, pulp & paper and general engineering industries globally.

Discover More

Case Study: BAE Systems Airbus

To overcome the need to remove the plateaux (part of the wing) to be milled flat for a precise fit, as well as avoiding the risk of distortion when re-fitted to the aircraft.

Discover More

Case Study: Esso Fawley Refinery

Esso’s unit 1 boiler at Fawley was shutdown for repair. The unit 2 boiler had developed a superheater tube leak. The challenge was to carry out a repair, the alternative was a shutdown of the major processing units.

Discover More

Case Study: Major Operator

The customer wanted to modify their petrochemical plant – but they didn’t want to shutdown.

Discover More

Case Study: North Cormorant Platform

The original configuration of pipe-work on the North Cormorant platform of the Otter over Eider project, did not lend itself to the increased flow.

Discover More

Case Study: Nuclear Electric

Accurate and reliable valve testing was required in quick time as part of the pre-commissioning process.

Discover More

Case Study: Shell Expro Gannet Platform

When Shell United Kingdom Exploration and Production (Expro) introduced a new Induced Gas Floatation Unit (IGFU) onto their Gannet platform they had planned to finalise the installation during a 30-hour shutdown.

Discover More

Furmanite - Innovative since 1920

Leak Sealing process developed leak-sealing-developed_thumb 01/01/1920

Furmanite Leak-Sealing process is Developed The under pressure Leak Sealing process is developed by Eugene Clay Furman at the Newport …

First DIY Leak-Sealing Kit old-furmanite-leak-sealing-equipment 01/01/1924

First DIY Leak-Sealing Kit The first do-it-yourself Leak Sealing kits were developed and marketed by Clay Furman and while they …

Long Standing Relationships Sales-Brochure-1926_thumb 01/01/1926

Long Standing Relationships US customer reference list that includes individual war ships in the US Navy, US steel companies and …

1st Patent is filed in 1927 furmanite-patents1 01/01/1927

1st Patent is filed in 1927 The Furmanite patent for the leak sealing process filed in 1927 was the first …

Furmanite moves Overseas Liverpool-Exibition_thumb 06/01/1927

Furmanite moves Overseas First overseas agents appointed to market the leak Sealing kits including in the United Kingdom and Euro…

Costs of a steam leak Sales-Brochure-1926-pg-8_thumb 06/01/1928

Price List from 1926 Table detailing costs of allowing a steam leak based on $4 per ton for “Long coal”. …

Furmanite is thinking global furmanite-the-skys-the-limit_thumb 01/01/1929

Furmanite is thinking global A brief history of the United Kingdom Company written by A W Forsyth (OBE) in September 1973 …

Technology Development leak-sealing-diagram 11/22/1934

Technology Development Furmanite Expands Engineering on Leak Sealing Technology. Photographs taken from a 1934 sales brochure together with schematics of …

Growing Furmanite purchase-letter_thumb 05/01/1960

Growing Furmanite Letter from the Chairman of Furmanite Engineering based in Birkenhead, England to his lawyer requesting information on a …

New Direction New-Technology_thumb 01/01/1966

New Direction Alan Forsyth, acting as a consultant to Furmanite Engineering (1929) advised the Board to move from selling low …

Never compromise on the high quality Company-History-July-1979_thumb 07/01/1979

Never to compromise on the high quality A brief history of the United Kingdom Furmanite organisation written by Joyce Hainsworth, the …

Best in the business were called NASA---Discovery-Team_thumb 09/01/1988

Best in the business were called Furmanite successfully seals nitrous oxide leakage on the Space Shuttle “Discovery” pre launch September …

Start of Modern Furmanite company-overview 11/22/1991

Start of Modern Furmanite The common shares of Furmanite were acquired by Kaneb Inc on 24th January 1991. Furmanite remains …

Acquisition-GSG Division Acquisition-GSG-Division_thumb 01/13/2006

Acquisition of Flow-Serve GSG Division Furmanite as part of Xanser Corporation acquired the General Services Group (GSG) of Flow-Serve corporation …

Corporate Name Change Corporate-Name-Change_thumb 01/13/2007

Corporate Name Change Xanser Corporation (NYSE:XNR) changed the company’s name to Furmanite Corporation, and the company’s shares were traded on …

Acquisition of SLM Acquisition-of-SLM_thumb 04/13/2011

Furmanite Corporation Acquires Self Leveling Machining Technology Furmanite expanded  its global on-site machining capabilities through the acquisition of Self Leveling …


Contact Us

  • Note: Forms may be submitted only once per webpage session.
  • This field is for validation purposes and should be left unchanged.