ENGlobal Reports First Quarter 2017 Results

ENGlobal Reports First Quarter 2017 Results
   
HOUSTON, TX--(Marketwired - May 11, 2017) - ENGlobal, a leading provider of engineering and automation services, today announced results for the first quarter ended April 1, 2017.

ENGlobal reported a net loss of $0.9 million for the first quarter of 2017 which was an increase in net loss of $0.1 million as compared to the net loss reported for the prior year period. Net loss per diluted share was ($0.03) for both the first quarter just ended and for the first quarter of 2016. Revenue decreased $2.3 million to $12.5 million from $14.8 million, or a 15.8% decrease, for the three months ended April 1, 2017, as compared to the three months ended March 26, 2016.

In April 2015, the Company's Board of Directors authorized the repurchase of up to $2.0 million of the Company's common stock from time to time, based on prevailing market conditions. Through April 1, 2017, ENGlobal has repurchased and retired approximately 1,127,894 shares of common stock at a cost of $1.4 million under this program. As of April 1, 2017, the remaining amount authorized for repurchase under this program was $0.6 million.

Management's Assessment

Mark Hess, ENGlobal's Chief Financial Officer stated: "We continue to maintain a strong balance sheet. We have no bank debt and have terminated our credit facility that was scheduled to expire in September 2017. We currently have working capital of over $20 million, which, along with internally generated funds is expected to provide for our near term operations and growth. We are working with potential lenders in preparation for the time when a new credit facility may be needed."

Mr. Hess continued: "We continue to rationalize our overhead structure and costs and have made significant changes to both during and subsequent to the first quarter. As a result, we expect to lower our ongoing cost structure by over $4 million annually."

William A. Coskey, P.E., Chairman and CEO of ENGlobal added: "Business has remained somewhat sluggish in the sectors of the energy market ENGlobal has historically served. However, all indications are that we have seen the bottom and should trend upward from here. We remain excited about larger opportunities the Company is currently pursuing as we continue to make good progress on our multi-year goal of reshaping the Company."

Mr. Coskey continued: "We have positioned ourselves to take advantage of increasing activity in our proposal pipeline by being vertically integrated from engineering and fabrication to automation and integration. With the recent addition of key personnel and infrastructure, ENGlobal now has the internal resources to deliver engineered, modularized solutions to our clients, which should be larger in scope and size than our heritage projects."

The following is a summary of the income statement for the three months ended April 1, 2017 and March 26, 2016:

(amounts in thousands)	Three months ended April 1, 2017			Three Months ended March 26, 2016
Revenue	$	12,473		$	14,812
Gross Profit		1,731			1,673
General & Administrative Expenses		3,406			3,390
Operating Loss		(1,675)			(1,717)
Net Loss		(878)			(749)

The following table presents certain balance sheet items as of April 1, 2017 and December 31, 2016:

(amounts in thousands)	As of April 1, 2017			As of December 31, 2016
Cash	$	14,373		$	15,687
Working capital		20,462			22,200

The following table illustrates the composition of the Company's revenue and profitability for its operations for the three months ended April 1, 2017 and March 26, 2016:

(amounts in thousands)		Three months ended April 1, 2017									Three Months ended March 26, 2016
					% of		Gross		Operating					% of		Gross		Operating
		Total			Total		Profit		Profit		Total			Total		Profit		Profit
Segment		Revenue			Revenue		Margin		Margin		Revenue			Revenue		Margin		Margin
Engineering & Construction		$	8,165		65.5%		11.5%		0.3%		$	8,527		57.6%		7.4%		(1.6)%
Automation			4,308		34.5%		18.3%		4.2%			6,285		42.4%		16.5%		4.7%
Consolidated		$	12,473		100.0%		13.9%		(13.4)%		$	14,812		100.0%		11.3%		(11.6)%

The Company's Quarterly Report on Form 10-Q for the quarterly period ended April 1, 2017 is expected to be filed with the Securities and Exchange Commission reflecting these results by the end of the day on Thursday, May 11, 2017.

ENGlobal Wins Modular Environmental Project

HOUSTON, TX--(Marketwired - Mar 21, 2017) - ENGlobal, a leading provider of engineering and automation services, today announced that it was awarded an environmental project valued at over $1 million, with the potential to expand to a larger scope. Located in the Southeast U.S, this environmentally driven installation will provide cleaner air and enhanced plant operability, while significantly benefitting from ENGlobal's accelerated schedule.

This award highlights the Company's integrated approach for providing engineered modular solutions utilizing its heritage professional skills together with its more recently formed fabrication capability. Execution of this important project will involve multiple ENGlobal capabilities, including engineering, automation, procurement and fabrication, for the key elements of an industrial recycling facility.

"We believe that our vertically integrated approach to project delivery will continue to benefit our targeted markets," said William A. Coskey, P.E., CEO of ENGlobal. "We are delighted to be selected as a critical partner for this environmental project."

ENGlobal 4Q and FY 2016 Results

ENGlobal Reports Fourth Quarter and Fiscal Year 2016 Results

HOUSTON, TX--(Marketwired - Mar 9, 2017) -  ENGlobal, a leading provider of engineering and automation services, today announced a net loss of $2.3 million and a diluted loss per share of $0.08 for the fiscal year ended December 31, 2016.

2016 Fiscal Year results as compared to 2015 Fiscal Year results:

Revenue decreased to $59.2 million for the fiscal year ended December 31, 2016, or a 25.6% decrease, from $79.6 million for the fiscal year ended December 26, 2015. ENGlobal reported a net loss of $2.3 million, or $0.08 per diluted share, for the fiscal year ended December 31, 2016, compared to net income of $10.5 million, or $0.38 per diluted share, for the prior year period. During the fiscal year ended December 31, 2016, the Company incurred non-cash expenses for depreciation, amortization and stock compensation of $1.6 million as compared to $2.0 million for the comparable period in 2015.

In April 2015, the Company's Board of Directors authorized the repurchase of up to $2.0 million of the Company's common stock from time to time, based on prevailing market conditions. Through February 28, 2017, ENGlobal has repurchased and retired 1,127,894 shares of common stock at a total cost of $1,407,106 under this program and the remaining amount authorized for repurchase under this program was $592,894.

Management's Assessment

Mark Hess, ENGlobal's Chief Financial Officer, said: "2016 was a challenging year for ENGlobal. With client spending on a decline, it was difficult to keep our work force utilized, which put downward pressure on our gross profit margins. During 2016, we trimmed our SG&A expenses over $1.8 million by streamlining our business processes, reducing our reliance on outside services and reducing our capital spending. This reduction was somewhat offset by the investments we made in people, equipment and facilities to support our modularized solutions initiative resulting in a net reduction in SG&A of $0.8 million from last year. While we realize our SG&A level is higher than it could be for a company our size, we have maintained our current overhead structure in anticipation of higher volumes."

Mr. Hess continued, "During 2016 we were able to bill and collect a significant portion of the retainage on the large project we are working on in Kazakhstan and Russia, which helped increase our cash position at the end of the year to $15.7 million. We expect to redeploy the majority of these funds in the execution of anticipated projects in the coming year."

William Coskey, P.E., Chairman and Chief Executive Officer of ENGlobal, said: "After several years of turning the business around and basically 'hunkering down' in a tough environment, I believe ENGlobal is now better positioned than at any time in its history. We're excited about the opportunity to engage in larger scopes of work which is now made possible as a result of our modular project delivery initiative. Throughout our Company, we've been making the necessary investments in key personnel and facilities in support of our business and our clients are responding positively. We're seeing more and larger opportunities as a result of our strengthened set of project capabilities. In summary, our team is excited about the strategy and I believe we have an excellent opportunity for renewed growth and improved results in the future."

The following table illustrates the composition of the Company's revenue and profitability for its operations for the fiscal years ended December 31, 2016 and December 26, 2015:

	Year Ended									Year Ended
(amounts in thousands)	December 31, 2016									December 26, 2015
Segment	Total Revenue			% of Total Revenue		Gross Profit Margin		Operating Profit Margin		Total Revenue			% of Total Revenue		Gross Profit Margin		Operating Profit Margin
Engineering & Construction	$	33,266		56.2%		12.1%		2.2%		$	49,277		61.9%		14.1%		8.6%
Automation		25,958		43.8%		23.5%		12.6%			30,328		38.1%		30.7%		22.5%
Consolidated	$	59,224		100.0%		17.1%		(5.5)%		$	79,605		100.0%		20.4%		2.6%

The following table illustrates the composition of the Company's revenue and profitability for its operations for the three months ended December 31, 2016 and December 26, 2015:

	Three Months Ended									Three Months Ended
(amounts in thousands)	December 31, 2016									December 26, 2015
Segment	Total Revenue			% of Total Revenue		Gross Profit Margin		Operating Profit Margin		Total Revenue			% of Total Revenue		Gross Profit Margin		Operating Profit Margin
Engineering & Construction	$	8,266		56.6%		13.7%		3.5%		$	11,103		64.4%		10.0%		4.4%
Automation		6,336		43.4%		24.8%		15.1%			6,137		35.6%		43.2%		33.4%
Consolidated		14,602		100.0%		18.5%		(3.0)%			17,240		100.0%		21.8%		2.9%

The following is a summary of the Company's income statement for the last four quarters which may be helpful in analyzing our ongoing business:

(amounts in thousands)		2016																Fiscal Year
		Q1				Q2				Q3				Q4				2016
Revenue		$	14,812			$	13,842			$	15,968			$	14,602			$	59,224
Gross Profit			1,673				1,853				3,881				2,705				10,112
	Gross Profit Margin		11.3	%			13.4	%			24.3	%			18.5	%			17.1	%
General & Administrative Expenses			3,390				3,313				3,511				3,136				13,350
Operating Income (Loss)			(1,717	)			(1,460	)			370				(431	)			(3,238	)
Net Income (Loss)			(749	)			(1,603	)			489				(479	)			(2,342	)

The following table presents certain balance sheet items as of December 31, 2016 and December 26, 2015:

(amounts in thousands)		As of December 31, 2016			As of December 26, 2015
Cash		$	15,687		$	7,806
Working capital			22,200			25,554
Credit facility balance			--			--

The Company's Annual Report on Form 10-K for the year ended December 31, 2016 is expected to be filed with the Securities and Exchange Commission today reflecting these results.

ENGlobal Adds Modular Project Execution Capabilities

ENGlobal Adds Modular Project Execution Capabilities
 
HOUSTON, TX--(Marketwired - Mar 1, 2017) - ENGlobal, a leading provider of engineering and automation services, today announced its recently opened 31 acre mechanical fabrication facility located in Henderson, Texas. With this newly available resource, the Company has strengthened its vertical integration for the engineering and delivery of a wide array of modular process systems. Through this strategy, the Company intends to leverage its heritage engineering and project support capabilities in order to realize larger turnkey scopes of work on suitable projects.
ENGlobal will target projects for which significant value can accrue to clients through a modular, "shop built" delivery approach. Expected benefits include the cost effectiveness of shop fabrication versus field construction together with improved performance metrics in the areas of schedule, quality and safety.
The Company has identified the following market areas which will be initially targeted for modular delivery:

• Upstream well site and area production systems
• Midstream metering and truck loading systems
• Downstream processing modules
• Environmental processing units
• Burner management systems
• Remote instrument and control buildings
• Electric power distribution centers
• On-line process analytical systems
• Industrial HVAC systems

"The opening of our Henderson facility and our full-service modular delivery capabilities represent a great opportunity for ENGlobal. It's exciting to now leverage our complete skills and engage in much larger scopes of work," stated William A. Coskey, P.E., Chairman and CEO of ENGlobal. "While this strategy is expected to be a multi-year growth effort, we have already put fabrication work into Henderson and are seeing a large number of modular proposal opportunities originating from across our heritage operations."