Granite Construction Q1 results: Revenue down 36 percent
Large-project construction revenue for the quarter totaled $106.3 million compared with $149.1 million for the same period last year. The decrease is attributable primarily to less revenue generated from projects nearing completion and new projects getting under way. First quarter 2009 revenue also included $17.3 million related to a favorable settlement on a project in the East.
- Gross profit margin for the quarter decreased to 9 percent compared with 23 percent for the same period last year. First-quarter 2009 margin also included $17.3 million related to the project settlement.
- Construction materials revenue for the quarter totaled $26.2 million compared with $29.8 million for the same period last year.
- Gross loss on the sale of construction materials was $7.1 million in 2010 compared with $0.3 million in 2009. The decline reflects lower sales volume during the quarter and the effects of fixed costs associated with our materials-processing facilities.
“We expect 2010 to be a challenging year for our business,” said Dorey. “Competition for the available work remains tough, and we expect gross margins on smaller projects to remain under pressure for the balance of the year. In addition, we now expect the Houston Metro Light Rail and the Queens Bored Tunnel projects to reach our profit recognition threshold in 2011, not 2010 as previously anticipated.
“Despite the challenging market conditions, we have a substantial number of bidding opportunities, and we expect backlog to increase throughout 2010,” Dorey continued. ”Longer-term, we expect to see the demand for our construction services and materials improve as the private development market begins to see signs of a recovery.
”For the full-year 2010, we expect Construction segment revenue to be $1.05 billion to $1.25 billion with a corresponding gross profit margin between 11.5 percent and 13 percent. Large Project Construction segment revenue is expected to be $725 million to $825 million with a corresponding gross profit margin of between 10 percent and 12 percent. Construction Materials segment revenue is expected to be $200 million to $250 million with corresponding gross profit margin between 12 percent and 13 percent. In addition, net income attributable to non-controlling interest in joint ventures for the total company is expected to be $20 million to $25 million,” said Dorey.
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