Orion Group Holdings Inc. (ORN) stock gained by 3.46% at last close while the ORN stock price plunged by 3.85% in the pre-market trading. Through its marine and concrete segments, Orion Group Holdings is a major specialized construction business servicing the infrastructure, industrial, and construction sectors, delivers services both on and off the sea throughout the continental United States, Alaska, Canada, and the Caribbean Basin.
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ORN stock, Q2 Financial Results
Orion Group Holdings has announced their second quarter 2021 financial highlights. The summary is given below:
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- Contract sales were $145.9 million shows a decrease of 20.6 percent from $183.7 million the previous year. The drop was largely because of the lower project activity in the maritime segment relative to the earlier year, as well as lower production volumes in the concrete segment owing to weather-related factors.
- The gross profit was $12.3 million, compared to $20.7 million the previous year. The gross profit margin was 8.4 percent, down from 11.3 percent the previous year. Reduced activity and volumes reduced revenue and resulted to an under recovery of indirect expenses largely due to lower equipment usage, resulting in a drop in gross profit dollars and percentage.
- Selling, general, and administrative costs were $13.7 million, down from $16.5 million in the previous year. SG&A expenditures grew by 0.4 percent as a proportion of overall contract revenues. In comparison to the prior year quarter, the drop in SG&A dollars was largely due to a decrease in bonus expenditure.
- Operating income was $5.6 million, up from $4.1 million the previous year. The $6.8 million net gain on the Tampa property sale explains the rise in operating income in the second quarter of 2021.
- EBITDA was $12.1 million, or an 8.3 percent EBITDA margin, relative to $11.1 million, or a 6.1 percent EBITDA margin, in the prior year.
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Mark Stauffer, Orion’s CEO commented,
They completed the sale of their Tampa property in the second quarter, improving the balance sheet and increasing liquidity. Wet climatic conditions in Texas hindered their concrete segment’s output throughout the quarter, and as a consequence, their labor capacity was underused. The capacity of the concrete sector to catch up on work and perform successfully in normal weather circumstances will enable them to conclude any projects that have been postponed in following quarters quickly. They are enthusiastic about their end markets and project prospects in the future.
They are enthusiastic about their end markets and project prospects in the future. They are optimistic that bidding opportunities will continue to emerge, particularly in COVID-affected end-markets such as the cruise and energy industries, which have started to generate project possibilities again. ORN is also keeping an eye on the federal infrastructure bill, which would act as a further spur for their end markets and accelerate industry capacity absorption.