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Schuff International Announces Financial and Operating Results for Second Quarter 2010

^{Published on 2010-07-30 05:11:24 - Market Wire}
 

PHOENIX--([ BUSINESS WIRE ])--Schuff International, Inc. (Pink Sheets: SHFK), a family of companies providing fully integrated steel construction services, today reported financial and operating results for the second quarter ended July 4, 2010.

"Our core markets and customers continue to be battered by the recession"

Second Quarter 2010 Results:

Revenues for the second quarter ended July 4, 2010 were $66.5 million, a decrease of 35.9 percent from year-ago revenues of $103.7 million.

Gross profit as a percentage of revenue was 15.6 percent for the second quarter ended July 4, 2010, compared with 24.5 percent for the second quarter ended July 5, 2009.

Operating income for the second quarter of 2010 was $1.3 million, down 91.6 percent from $13.3 million in the year-ago quarter. Operating margin decreased to 1.9 percent from 12.8 percent in the year-ago period, due primarily to lower revenues earned during the quarter.

Net income for the quarter was $0.7 million, or $0.07 per diluted share, versus $8.0 million, or $0.86 per diluted share, a year ago.

Schuff Internationala™s backlog was $165.4 million ($150.1 million under contracts or purchase orders and $15.4 million under letters of intent) at July 4, 2010 compared with $184.1 million ($147.3 million under contracts or purchase orders and $36.8 million under letters of intent) at April 4, 2010. Approximately $53.7 million, representing 32.5 percent of the companya™s backlog at July 4, 2010, was attributable to five contracts, letters of intent, notices to proceed or purchase orders.

Six Months 2010 Results:

Revenues for the six months ended July 4, 2010 were $148.5 million, a decrease of 36.2 percent from year-ago revenues of $232.9 million. The year-over-year revenue decrease resulted primarily from the overall downturn in commercial construction.

Gross profit as a percentage of revenue was 15.6 percent for the six months ended July 4, 2010, compared with 23.3 percent for the year-ago period.

Operating income for the first six months of 2010 was $4.0 million, down 86.2 percent from $29.3 million for the first six months of 2009. Operating margin decreased to 2.7 percent from 12.6 percent in the year-ago period.

Net income for the six months ended July 4, 2010 was $2.2 million, or $0.23 per diluted share, versus $17.6 million, or $1.89 per diluted share, a year ago.

aOur core markets and customers continue to be battered by the recession,a said Scott A. Schuff, president and CEO. aWe expect the second half of 2010 to present a continuing challenge for our business. Competition for the work that is available remains tough, and we expect gross margins on smaller projects to be under pressure for the remainder of the year.

aHowever, our financial position is strong and has not limited our ability to pursue new awards, or to execute projects to the highest standards of effectiveness and safety. We believe our long-term growth strategy and cost structure position us to capitalize on opportunities emerging as our core markets improve. Even now, we are encouraged by relative strength in new hospital construction and overall growth in healthcare-related building activity,a concluded Schuff.

Schuff International, Inc. (Pink Sheets: SHFK) and its family of steel companies is the largest steel fabrication and erection company in the United States. The 34-year old company executes projects throughout the country as well as internationally. Schuff offers integrated steel construction services from a single source including design-build, design-assist, engineering, BIM participation, 3D steel modeling/detailing, fabrication, advanced field erection, joist and joist girder manufacturing, project management, and single-source steel management systems. Schuff International, Inc. employs approximately 1,300 people throughout the country. For more information, visit [ www.schuff.com ].

Certain statements in this news release may contain forward-looking information within the meaning of the Private Securities Litigation Reform Act of 1995, and are subject to the safe harbor created by those rules. All statements, other than statements of fact, included in this release, including, without limitation, statements regarding potential future plans and objectives of the company are forward-looking statements that involve risks and uncertainties. There can be no assurance that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. These risks and uncertainties, some of which are beyond the control of the company, include, but are not limited to, the company's ability to successfully and timely complete construction projects; the companya™s ability to convert backlog into revenue; the potential delay, suspension, termination, or reduction in scope of a construction project; the continuing validity of the underlying assumptions and estimates of total forecasted project revenues, costs and profits and project schedules; the outcomes of pending or future litigation, arbitration or other dispute resolution proceedings; the availability of borrowed funds on terms acceptable to the company; the ability to retain certain members of management; the ability to obtain surety bonds to secure its performance under certain construction contracts; possible labor disputes or work stoppages within the construction industry; the ability of project owners to obtain and/or continue to maintain financing for projects; possible changes or developments in domestic and worldwide financial, political and social circumstances; and actions taken or not taken by third parties, including the companya™s customers, suppliers, business partners, and competitors and legislative, regulatory, judicial and other governmental authorities and officials. The company cautions that these forward-looking statements are further qualified by other factors. The company undertakes no obligation to publicly update or revise any statements in this release, whether as a result of new information, future events or otherwise.

Financial tables follow.