Willbros Reports Fourth Quarter and Full Year 2015 Results

What: 

Willbros Fourth Quarter and Full Year 2015 Earnings Conference Call

When: 

Thursday, March 10, 2016 - 10:00 a.m. Eastern Time (9:00 a.m. Central Time)

How: 

Live via phone - By dialing 877-404-9648 or 412-902-0030 a few minutes prior to the start time and asking for the Willbros' call.  Or live over the Internet by logging on to the web address below.

Where:

http://www.willbros.com. The webcast can be accessed from the investor relations home page.

WILLBROS GROUP, INC.

(In thousands, except per share amounts)

 Three Months Ended 

 Year Ended 

 December 31, 

 December 31, 

2015

2014

2015

2014

Income Statement 

Contract revenue

Oil & Gas

$        77,863

$        160,822

$   297,110

$   826,088

Utility T&D

97,282

92,761

379,629

363,779

Canada

42,586

91,456

232,534

404,589

Eliminations

(71)

(86)

(279)

(86)

217,660

344,953

908,994

1,594,370

Operating expenses

Oil & Gas

90,758

172,744

345,060

880,532

Utility T&D

101,830

93,986

389,650

357,183

Canada

43,377

89,717

231,637

372,662

Unallocated Corporate Costs

-

4,029

7,850

12,526

Gain on sale of subsidiary

(12,826)

-

(12,826)

-

Eliminations

(71)

(86)

(279)

(86)

223,068

360,390

961,092

1,622,817

Operating income (loss)

Oil & Gas

(12,895)

(11,922)

(47,950)

(54,444)

Utility T&D

(4,548)

(1,225)

(10,021)

6,596

Canada

(791)

1,739

897

31,927

Unallocated Corporate Costs

-

(4,029)

(7,850)

(12,526)

Gain on sale of subsidiary

12,826

-

12,826

-

Operating loss

(5,408)

(15,437)

(52,098)

(28,447)

Non-operating expenses

Interest expense, net

(6,264)

(7,694)

(27,203)

(30,359)

Debt covenant suspension and extinguishment charges

(2,066)

(14,228)

(39,178)

(15,176)

Other, net

80

77

(101)

(397)

(8,250)

(21,845)

(66,482)

(45,932)

Loss from continuing operations before income taxes

(13,658)

(37,282)

(118,580)

(74,379)

Provision (benefit) for income taxes

(32,867)

5,157

(54,031)

229

Income (loss) from continuing operations

19,209

(42,439)

(64,549)

(74,608)

Income (loss) from discontinued operations, net of provision for income taxes

58,183

6,472

96,032

(5,219)

Net income (loss)

$        77,392

$         (35,967)

$     31,483

$    (79,827)

Basic income (loss) per share attributable to Company shareholders:

Continuing operations

$            0.32

$             (0.86)

$       (1.12)

$        (1.51)

Discontinued operations

0.96

0.14

1.66

(0.11)

$            1.28

$             (0.72)

$         0.54

$        (1.62)

Diluted income (loss) per share attributable to Company shareholders:

Continuing operations

$            0.31

$             (0.86)

$       (1.12)

$        (1.51)

Discontinued operations

0.95

0.14

1.66

(0.11)

$            1.26

$             (0.72)

$         0.54

$        (1.62)

Cash Flow Data

Continuing operations

Cash provided by (used in)

Operating activities

$        31,215

$         (43,275)

$     46,009

$    (21,837)

Investing activities

106,829

754

210,423

42,488

Financing activities

(94,841)

32,921

(177,266)

(2,678)

Foreign exchange effects

(2,685)

(374)

(3,437)

(1,057)

Discontinued operations

(29,791)

(15,688)

(40,170)

(37,253)

Other Data (Continuing Operations)

Weighted average shares outstanding

Basic

60,510

49,630

57,760

49,310

Diluted

61,092

49,630

57,760

49,310

Adjusted EBITDA from continuing operations⁽¹⁾

$         (3,634)

$             (263)

$    (19,461)

$     15,618

Purchases of property, plant and equipment

650

2,675

2,705

11,584

Reconciliation of Non-GAAP Financial Measures

Adjusted EBITDA from continuing operations ⁽¹⁾

Income (loss) from continuing operations

$        19,209

$         (42,439)

$    (64,549)

$    (74,608)

Interest expense, net

6,264

7,694

27,203

30,359

Provision (benefit) for income taxes

(32,867)

5,157

(54,031)

229

Depreciation and amortization

6,154

7,801

27,200

31,873

Debt covenant suspension and extinguishment charges

2,066

14,228

39,178

15,176

Stock based compensation

2,052

3,926

6,605

12,475

Restructuring charges

2,966

1,790

9,475

1,878

Accounting and legal fees associated with the restatements

(56)

3,413

595

3,413

Gain on disposal of property and equipment

(387)

(1,833)

(2,102)

(5,177)

Gain on sale of subsidiary

(12,826)

-

(12,826)

-

Impairment of long-lived assets

3,791

-

3,791

-

Adjusted EBITDA from continuing operations⁽¹⁾

$             (263)

$    (19,461)

$     15,618

Balance Sheet Data

December 31,
2015

September 30,
2015

June 30,
2015

March 31,
2015

Cash and cash equivalents

$         58,832

$           47,837

$     67,845

$     38,361

Working capital

122,691

156,227

172,568

193,912

Total assets

445,608

513,830

557,206

613,203

Total debt  

95,821

190,416

191,520

206,068

Stockholders' equity

177,400

98,284

118,969

134,353

Backlog Data ⁽²⁾

Total By Reporting Segment

Oil & Gas

$         48,810

$         110,019

$     87,390

$     94,903

Utility T&D

622,629

689,388

760,501

795,492

Canada

155,379

177,259

233,257

167,904

Total Backlog

$       826,818

$         976,666

$1,081,148

$1,058,299

Total Backlog By Geographic Area

United States

$       671,439

$         799,407

$   847,891

$   890,395

Canada

155,379

177,259

233,257

167,904

Total Backlog

$       826,818

$         976,666

$1,081,148

$1,058,299

12 Month Backlog

$       432,217

$         510,035

$   534,433

$   512,907

(1)

Adjusted EBITDA from continuing operations is defined as income (loss) from continuing operations before interest expense, income tax expense (benefit) and depreciation and amortization, adjusted for items broadly consisting of selected items which management does not consider representative of our ongoing operations and certain non-cash items of the Company.  Management uses Adjusted EBITDA from continuing operations as a supplemental performance measure for comparing normalized operating results with corresponding historical periods and with the operational performance of other companies in our industry and for presentations made to analysts, investment banks and other members of the financial community who use this information in order to make investment decisions about us.

Adjusted EBITDA from continuing operations is not a financial measurement recognized under U.S. generally accepted accounting principles, or U.S. GAAP.  When analyzing our operating performance, investors should use Adjusted EBITDA from continuing operations in addition to, and not as an alternative for, net income, operating income, or any other performance measure derived in accordance with U.S. GAAP, or as an alternative to cash flow from operating activities as a measure of our liquidity.  Because all companies do not use identical calculations, our presentation of Adjusted EBITDA from continuing operations may be different from similarly titled measures of other companies.

(2)

Backlog is anticipated contract revenue from uncompleted portions of existing contracts and contracts whose award is reasonably assured.  Master Service Agreement ("MSA") backlog is estimated for the remaining term of the contract.  MSA backlog is determined based on historical trends inherent in the MSAs, factoring in seasonal demand and projecting customer needs based on ongoing communications.  Backlog is not a term recognized under U.S. GAAP; however, it is a common measurement used in our industry.

Supplemental Schedule of Special Items

Three Months Ended March 31, 2015 

(In thousands)

Oil & Gas

Utility T&D

Canada

Unallocated Corporate Costs

Gain On Sale Of Subsidiary

Eliminations

Consolidated

Contract revenue before special items ⁽¹⁾

Contract revenue, as reported

$         76,440

$   86,986

$  87,009

$                -

$          -

$           (81)

$      250,354

Contract revenue, exited subsidiaries ⁽²⁾

(35,128)

(2,842)

-

-

-

-

(37,970)

Contract revenue before special items

$         41,312

$   84,144

$  87,009

$                -

$          -

$           (81)

$      212,384

Operating income (loss) before special items ⁽¹⁾

Operating loss, as reported

$       (10,975)

$    (4,860)

$   (1,515)

$      (3,935)

$          -

$               -

$      (21,285)

Operating (income) loss, exited subsidiaries ⁽²⁾

47

(132)

-

-

-

-

(85)

Other charges

829

692

692

797

-

-

3,010

Operating loss before special items

$       (10,099)

$    (4,300)

$     (823)

$      (3,138)

$          -

$               -

$      (18,360)

Three Months Ended June 30, 2015 

(In thousands)

Oil & Gas

Utility T&D

Canada

Unallocated Corporate Costs

Gain On Sale Of Subsidiary

Eliminations

Consolidated

Contract revenue before special items ⁽¹⁾

Contract revenue, as reported

$         61,778

$ 106,439

$  50,645

$                -

$          -

$           (73)

$      218,789

Contract revenue, exited subsidiaries ⁽²⁾

(14,217)

(3,821)

-

-

-

-

(18,038)

Contract revenue before special items

$         47,561

$ 102,618

$  50,645

$                -

$          -

$           (73)

$      200,751

Operating income (loss) before special items ⁽¹⁾

Operating income (loss), as reported

$       (15,751)

$     4,666

$      381

$      (2,334)

$          -

$                -

$      (13,038)

Operating (income) loss, exited subsidiaries ⁽²⁾

4,843

(962)

-

-

-

-

3,881

Other charges

2,749

290

208

71

-

-

3,318

Operating income (loss) before special items

$         (8,159)

$     3,994

$      589

$      (2,263)

$          -

$                -

$        (5,839)

Three Months Ended September 30, 2015 

(In thousands)

Oil & Gas

Utility T&D

Canada

Unallocated Corporate Costs

Gain On Sale Of Subsidiary

Eliminations

Consolidated

Contract revenue before special items ⁽¹⁾

Contract revenue, as reported

$         81,029

$   88,922

$  52,294

$                -

$          -

$           (54)

$      222,191

Contract revenue, exited subsidiaries ⁽²⁾

(7,783)

(2,943)

-

-

-

-

(10,726)

Contract revenue before special items

$         73,246

$   85,979

$  52,294

$                -

$          -

$           (54)

$      211,465

Operating income (loss) before special items ⁽¹⁾

Operating income (loss), as reported

$         (8,329)

$    (5,279)

$    2,822

$      (1,581)

$          -

$               -

$      (12,367)

Operating loss, exited subsidiaries ⁽²⁾

2,092

7

-

-

-

-

2,099

Other charges

3,787

81

11

(7)

-

-

3,872

Operating income (loss) before special items

$         (2,450)

$    (5,191)

$    2,833

$      (1,588)

$          -

$               -

$        (6,396)

Three Months Ended December 31, 2015 

(In thousands)

Oil & Gas

Utility T&D

Canada

Unallocated Corporate Costs

Gain On Sale Of Subsidiary

Eliminations

Consolidated

Contract revenue before special items ⁽¹⁾

Contract revenue, as reported

$         77,863

$   97,282

$  42,586

$            -

$              -

$           (71)

$      217,660

Contract revenue, exited subsidiaries ⁽²⁾

(1,285)

(156)

-

-

-

-

(1,441)

Contract revenue before special items

$         76,578

$   97,126

$  42,586

$            -

$              -

$           (71)

$      216,219

Operating income (loss) before special items ⁽¹⁾

Operating income (loss), as reported

$       (12,895)

$    (4,548)

$     (791)

$            -

$   12,826

$             -

$        (5,408)

Operating loss, exited subsidiaries ⁽²⁾

3,046

3

-

-

-

-

3,049

Other charges

4,166

3,079

1,024

-

-

-

8,269

Gain on sale of subsidiary

-

-

-

-

(12,826)

-

(12,826)

Operating income (loss) before special items

$         (5,683)

$    (1,466)

$      233

$            -

$            -

$             -

$        (6,916)

Year Ended December 31, 2015 

(In thousands)

Oil & Gas

Utility T&D

Canada

Unallocated Corporate Costs

Gain On Sale Of Subsidiary

Eliminations

Consolidated

Contract revenue before special items ⁽¹⁾

Contract revenue, as reported

$       297,110

$ 379,629

$232,534

$               -

$             -

$          (279)

$      908,994

Contract revenue, exited subsidiaries ⁽²⁾

(58,413)

(9,762)

-

-

-

-

(68,175)

Contract revenue before special items

$       238,697

$ 369,867

$232,534

$               -

$             -

$          (279)

$      840,819

Operating income (loss) before special items ⁽¹⁾

Operating income (loss), as reported

$       (47,950)

$  (10,021)

$      897

$      (7,850)

$   12,826

$                -

$      (52,098)

Operating (income) loss, exited subsidiaries ⁽²⁾

10,028

(1,084)

-

-

-

-

8,944

Other charges

11,531

4,142

1,935

861

-

-

18,469

Gain on sale of subsidiary

-

-

-

-

(12,826)

-

(12,826)

Operating income (loss) before special items

$       (26,391)

$    (6,963)

$    2,832

$      (6,989)

$          -

$                -

$      (37,511)

Q1 2015

Q2 2015

Q3 2015

Q4 2015

FY 2015

Adjusted EBITDA from continuing operations before special items ⁽¹⁾

Adjusted EBITDA from continuing operations, as reported

$         (9,980)

$    (4,032)

$   (1,815)

$      (3,634)

$  (19,461)

Adjusted EBITDA from continuing operations, exited subsidiaries ⁽²⁾

(1,062)

2,707

1,477

518

3,640

Adjusted EBITDA from continuing operations before special items

$       (11,042)

$    (1,325)

$     (338)

$      (3,116)

$  (15,821)

 December 31, 2015 

Income (loss) from continuing operations before special items ⁽¹⁾

Three Months Ended  

Year
Ended

Income (loss) from continuing operations, as reported

$        19,209

$ (64,549)

Loss from continuing operations, exited subsidiaries ⁽²⁾

3,049

8,944

Other charges

8,269

18,469

Gain on sale of subsidiary

(12,826)

(12,826)

Debt covenant suspension and extinguishment charges

2,066

39,178

Interest expense, net

1,154

1,154

Benefit for income taxes ⁽³⁾

(34,664)

(57,210)

Loss from continuing operations before special items

$       (13,743)

$ (66,840)

 December 31, 2015 

Income (loss) from discontinued operations before special items ⁽¹⁾

Three Months Ended  

Year
Ended

Income from discontinued operations, as reported

$        58,183

$  96,032

Other charges

-

4,405

Gain on sale of subsidiaries

(96,427)

(152,208)

Provision for income taxes ⁽³⁾

34,664

57,210

Income (loss) from discontinued operations before special items

$         (3,580)

$     5,439

Net loss before special items ⁽¹⁾

$       (17,323)

$ (61,401)

Diluted income (loss) per share attributable to Company shareholders before special items ⁽¹⁾

Continuing operations

$           (0.22)

$    (1.16)

Discontinued operations

(0.06)

0.10

$           (0.28)

$    (1.06)

(1) Contract revenue before special items, operating income (loss) before special items, Adjusted EBITDA from continuing operations before special items, Income (loss) from continuing operations before special items, Income from discontinued operations before special items, Net income before special items and Diluted income (loss) per share attributable to Company shareholders before special items are non-GAAP financial measures that exclude special items that management believes affect the comparison of results for the periods presented.  Management also believes results excluding these items are more comparable to estimates provided by securities analysts and therefore are useful in evaluating operational trends of the Company and its performance relative to other construction companies.  In addition, Management believes results excluding these items are more indicative of the future operating prospects for Willbros as a consolidated company in 2016.

(2) Contract revenue, exited subsidiaries, operating (income) loss), exited subsidiaries, Adjusted EBITDA from continuing operations, exited subsidiaries and (Income) loss from continuing operations, exited subsidiaries relate to the Company's historical Downstream Oil & Gas (including Fabrication services sold in the first quarter of 2016), Regional Delivery and Bemis subsidiaries.  They are non-GAAP financial measures that exclude special items that management believes affect the comparison of results for the periods presented.  Management also believes results excluding these items are more comparable to estimates provided by securities analysts and therefore are useful in evaluating operational trends of the Company and its performance relative to other construction companies.  In addition, Management believes results excluding these items are more indicative of the future operating prospects for Willbros as a consolidated company in 2016.

(3) The Company recorded a provision for income taxes on discontinued operations in connection with the 2015 gain on sale of the Professional Services segment and its historical subsidiaries. The provision for income taxes in discontinued operations was fully offset with a benefit for income taxes in continuing operations through the utilization of prior year net operating losses.  The net effect on the Company's consolidated financial results was $-0-