Granite Construction sees gain in year-over-year revenues

xtown action MGD©Santa Cruz Sentinel WATSONVILLE—Granite Construction shares dropped more than 5 percent Friday after announcing a slight drop in fourth quarter revenues and a slight increase in revenues for the full year. Granite Construction, one of the top 25 largest construction companies in the U.S., specializes in complex infrastructure projects primarily in the transportation sector. Granite’s numbers included improved operating efficiencies across the company, but slower than expected progress on some large projects due to weather, said Jim Roberts, Granite president and CEO on a conference call with investors and analysts. The late November rains in California contributed to “a significant revenue headwind” in the fourth quarter that shifted revenues to first quarter of this year. Across the nation, severe weather continues to be a challenge for construction. Lastly, the company continues to have unsettled compensation claims on projects with unexpected cost overruns, he said. Fourth quarter revenues of $589.8 million were down 1.4 percent from a year ago. Net income was $17 million, compared with a net loss of $29 million a year ago in the same quarter. Diluted EPS in the quarter was 43 cents compared to a loss of 74 cents per share a year ago. Revenues for the full year were almost $2.28 billion, compared to about $2.27 billion in 2013. Net income for 2014 was $25.35 million, compared to a loss of about $36.42 million in 2013. In particular the company saw revenue growth in its large project construction business, which was up 6.1 percent; and in its construction materials business, which was up 10.9 percent. The construction segment part of the company saw revenues drop 5.2 percent, “driven primarily by weaker-than-anticipated results in certain Western markets and delayed awards in private sector work.” The company has a $2.7 billion project backlog and $358 million in cash and marketable securities. It was “a year of accomplishment and improvement,” he said, noting ongoing lobbying for a new highway bill. Without secure infrastructure funding from Congress, it will take some time to grow margins, but the company would “continue to grow the top and bottom line without the reliance on Congress.”

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