Orion Group Holdings, Inc. Reports Third Quarter 2022 Results

Rhea-AI Summary

Orion Group Holdings, Inc. (NYSE: ORN) reported a net income of $0.2 million or $0.01 per diluted share for Q3 2022, an improvement from a net loss of $10.2 million in Q3 2021. Adjusted net income was $0.8 million ($0.02 per share). Contract revenues increased by 30.5% to $182.6 million, primarily driven by large job starts in the marine segment. The backlog as of September 30, 2022, was $548.6 million. The Company also announced a $10.5 million sale-leaseback agreement for its Port Lavaca property, set to close in December.

Positive

• Net income improved to $0.2 million in Q3 2022 from a loss of $10.2 million in Q3 2021.
• Contract revenues increased by 30.5% to $182.6 million.
• Adjusted EBITDA was $8.8 million, a significant rise from $(0.5) million a year earlier.

Negative

• Backlog decreased from $572.8 million in Q3 2021 to $548.6 million in Q3 2022.
• Win rate for awarded bids in the concrete segment was low at 6.2%.

HOUSTON, Oct. 26, 2022 (GLOBE NEWSWIRE) -- Orion Group Holdings, Inc. (NYSE: ORN) (the “Company”), a leading specialty construction company, today reported net income of $0.2 million ($0.01 diluted earnings per share) for the third quarter ended September 30, 2022. Excluding non-recurring items, adjusted net income was $0.8 million ($0.02 diluted earnings per share).

Third Quarter 2022 Highlights

• The Company has enhanced the capabilities of its management team with the addition of two experienced and operationally-focused executives, Chief Executive Officer Travis Boone and Chief Financial Officer Scott Thanisch.
  
  
• Continued efforts focusing on more attractive markets and targeting higher bid margins is yielding improved project margins on new contract awards of $128 million in the quarter.
  
  
• The Company has signed an agreement for the $10.5 million sale-leaseback of its Port Lavaca property expected to close in December and continues to explore options to monetize additional real estate assets.
  
  
• Operating income was $1.1 million for the third quarter of 2022 compared to an operating loss of $8.7 million for the third quarter of 2021.
  
  
• Net income was $0.2 million ($0.01 diluted earnings per share) for the third quarter of 2022 compared to a net loss of $10.2 million ($0.33 diluted loss per share) for the third quarter of 2021.
  
  
• The third quarter 2022 net income included $0.5 million ($0.01 diluted earnings per share) of non-recurring items. Third quarter 2022 adjusted net income was $0.8 million ($0.02 diluted earnings per share). (Please see page 7 of this release for an explanation of adjusted net income, adjusted earnings per share and a reconciliation to the nearest GAAP measure). 
  

“We are excited to see bid margins of recent wins increasing in the third quarter due to more disciplined bidding practices established over the past few months,” stated Travis Boone, Orion’s Chief Executive Officer. “These higher margin projects will establish a solid base of work for 2023. We will continue to focus on disciplined bidding, along with strong project delivery, as we pursue profitable growth.”

Consolidated Results for Third Quarter 2022 Compared to Third Quarter 2021

• Contract revenues were $182.6 million, an increase of $42.7 million or 30.5% as compared to $139.9 million. The increase was primarily driven by the start of large jobs awarded in the fourth quarter of 2021 in the marine segment, higher volume in the concrete segment and the impact from claims and unapproved change orders recognized related to work primarily incurred in previous periods.
  
  
• Gross profit was $13.4 million, as compared to $6.6 million. Gross profit margin was 7.4%, as compared to 4.7%. The increase in gross profit dollars and margin was primarily driven by the impact from claims and unapproved change orders recognized related to work primarily incurred in previous periods, the release of discretionary project bonuses and increased dredging activity as compared to the prior year period.
  
  
• Selling, General, and Administrative (“SG&A”) expenses were $15.4 million, as compared to $15.7 million. As a percentage of total contract revenues, SG&A expenses decreased from 11.2% to 8.5%, primarily due to higher revenues in the current period. The decrease in SG&A dollars was driven primarily by a decrease in Enterprise Resource Planning implementation expense as compared to the prior year period, partially offset by consulting fees related to the management transition.
  
  
• EBITDA was $7.2 million, representing a 4.0% EBITDA margin, as compared to EBITDA of $(2.5) million, or an (1.8)% EBITDA margin. When adjusted for non-recurring items, adjusted EBITDA for the third quarter of 2022 was $8.8 million, representing a 4.8% adjusted EBITDA margin, as compared to adjusted EBITDA for the third quarter of 2021 of $(0.5) million, representing a (0.3)% adjusted EBITDA margin. (Please see page 8 of this release for an explanation of EBITDA, Adjusted EBITDA and a reconciliation to the nearest GAAP measure).
  

Backlog

Backlog of work under contract as of September 30, 2022 was $548.6 million, which compares with backlog of work under contract as of September 30, 2021 of $572.8 million. The third quarter 2022 ending backlog was composed of $280.2 million in the marine segment, and $268.4 million in the concrete segment. At the end of the third quarter 2022, the Company had approximately $1.8 billion worth of bids outstanding, including successful bids on approximately $39 million of projects, subsequent to the end of the third quarter of 2022, of which approximately $36 million pertains to the marine segment and approximately $3 million to the concrete segment. 

“During the third quarter, we converted to backlog $128 million of the $1.2 billion of work on which we bid,” stated Scott Thanisch, Orion’s Chief Financial Officer. “This resulted in a 0.70 times book-to-bill ratio and a win rate of 10.5%. In the marine segment, we bid on $377 million during the third quarter 2022 and were successful on $75 million, representing a win rate of 20.0% and a book-to-bill ratio of 0.99 times. In the concrete segment we bid on $849 million of work and were awarded $53 million, representing a win rate of 6.2% and a book-to-bill ratio of 0.50 times.”

Backlog consists of projects under contract that have either (a) not been started, or (b) are in progress but are not yet complete. The Company cannot guarantee that the revenue implied by its backlog will be realized, or, if realized, will result in earnings. Backlog can fluctuate from period to period due to the timing and execution of contracts. Given the typical duration of the Company's projects, which generally range from three to nine months, the Company's backlog at any point in time usually represents only a portion of the revenue it expects to realize during a twelve-month period.

Conference Call Details

Orion Group Holdings will host a conference call to discuss results for the third quarter 2022 at 10:00 a.m. Eastern Time/9:00 a.m. Central Time on Thursday, October 27, 2022. To listen to the call live, dial 800-715-9871 in the US and Canada or 646-307-1963 in the US and ask for the Orion Group Holdings Conference Call. To listen to the call via the Internet, please visit https://edge.media-server.com/mmc/p/a7xmvgsg. Please go to the website 15 minutes early to download and install any necessary audio software. If you are unable to listen live, a replay of the conference call may be accessed for approximately 30 days after the call at Orion Group Holdings' website.

About Orion Group Holdings

Orion Group Holdings, Inc., a leading specialty construction company serving the infrastructure, industrial and building sectors, provides services both on and off the water in the continental United States, Alaska, Canada and the Caribbean Basin through its marine segment and its concrete segment. The Company’s marine segment provides construction and dredging services relating to marine transportation facility construction, marine pipeline construction, marine environmental structures, dredging of waterways, channels and ports, environmental dredging, design, and specialty services. Its concrete segment provides turnkey concrete construction services including pour and finish, dirt work, layout, forming, rebar, and mesh across the light commercial, structural and other associated business areas. The Company is headquartered in Houston, Texas with regional offices throughout its operating areas.

Non-GAAP Financial Measures

This press release includes the financial measures “adjusted net income/loss,” “adjusted earnings/loss per share,” “EBITDA,” "Adjusted EBITDA" and “Adjusted EBITDA margin." These measurements are “non-GAAP financial measures” under rules of the Securities and Exchange Commission, including Regulation G. The non-GAAP financial information may be determined or calculated differently by other companies. By reporting such non-GAAP financial information, the Company does not intend to give such information greater prominence than comparable GAAP financial information. Investors are urged to consider these non-GAAP measures in addition to and not in substitute for measures prepared in accordance with GAAP.

Adjusted net income/loss and adjusted earnings/loss per share are not an alternative to net income/loss or earnings/loss per share. Adjusted net income/loss and adjusted earnings/loss per share exclude certain items that management believes impairs a meaningful comparison of operating results. The Company believes these adjusted financial measures are a useful adjunct to earnings/loss calculated in accordance with GAAP because management uses adjusted net income/loss available to common stockholders to evaluate the Company's operational trends and performance relative to other companies. Generally, items excluded, are one-time items or items whose timing or amount cannot be reasonably estimated. Accordingly, any guidance provided by the Company generally excludes information regarding these types of items.

Orion Group Holdings defines EBITDA as net income/loss before net interest expense, income taxes, depreciation and amortization. Adjusted EBITDA is calculated by adjusting EBITDA for certain items that management believes impairs a meaningful comparison of operating results. Adjusted EBITDA margin is calculated by dividing Adjusted EBITDA for the period by contract revenues for the period. The GAAP financial measure that is most directly comparable to EBITDA and Adjusted EBITDA is net income, while the GAAP financial measure that is most directly comparable to Adjusted EBITDA margin is operating margin, which represents operating income divided by contract revenues. EBITDA, Adjusted EBITDA and Adjusted EBITDA margin are used internally to evaluate current operating expense, operating efficiency, and operating profitability on a variable cost basis, by excluding the depreciation and amortization expenses, primarily related to capital expenditures and acquisitions, and net interest and tax expenses. Additionally, EBITDA, Adjusted EBITDA and Adjusted EBITDA margin provide useful information regarding the Company's ability to meet future debt service and working capital requirements while providing an overall evaluation of the Company's financial condition. In addition, EBITDA is used internally for incentive compensation purposes. The Company includes EBITDA, Adjusted EBITDA and Adjusted EBITDA margin to provide transparency to investors as they are commonly used by investors and others in assessing performance. EBITDA, Adjusted EBITDA and Adjusted EBITDA margin have certain limitations as analytical tools and should not be used as a substitute for operating margin, net income, cash flows, or other data prepared in accordance with GAAP, or as a measure of the Company's profitability or liquidity.

The matters discussed in this press release may constitute or include projections or other forward-looking statements within the meaning of the “safe harbor” provisions of Section 27A of the Securities Exchange Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, of which provisions the Company is availing itself. Certain forward-looking statements can be identified by the use of forward-looking terminology, such as 'believes', 'expects', 'may', 'will', 'could', 'should', 'seeks', 'approximately', 'intends', 'plans', 'estimates', or 'anticipates', or the negative thereof or other comparable terminology, or by discussions of strategy, plans, objectives, intentions, estimates, forecasts, outlook, assumptions, or goals. In particular, statements regarding future operations or results, including those set forth in this press release, and any other statement, express or implied, concerning future operating results or the future generation of or ability to generate revenues, income, net income, gross profit, EBITDA, Adjusted EBITDA, Adjusted EBITDA margin, or cash flow, including to service debt, and including any estimates, forecasts or assumptions regarding future revenues or revenue growth, are forward-looking statements. Forward looking statements also include estimated project start date, anticipated revenues, and contract options which may or may not be awarded in the future. Forward looking statements involve risks, including those associated with the Company's fixed price contracts that impacts profits, unforeseen productivity delays that may alter the final profitability of the contract, cancellation of the contract by the customer for unforeseen reasons, delays or decreases in funding by the customer, levels and predictability of government funding or other governmental budgetary constraints, the effects of the ongoing COVID-19 pandemic, and any potential contract options which may or may not be awarded in the future, and are at the sole discretion of award by the customer. Past performance is not necessarily an indicator of future results. In light of these and other uncertainties, the inclusion of forward-looking statements in this press release should not be regarded as a representation by the Company that the Company's plans, estimates, forecasts, goals, intentions, or objectives will be achieved or realized. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof. The Company assumes no obligation to update information contained in this press release whether as a result of new developments or otherwise, except as required by law.

Please refer to the Company's Annual Report on Form 10-K, filed on March 7, 2022, which is available on its website at www.oriongroupholdingsinc.com or at the SEC's website at www.sec.gov, for additional and more detailed discussion of risk factors that could cause actual results to differ materially from our current expectations, estimates or forecasts.

CONTACT:
Orion Group Holdings Inc.
Francis Okoniewski, VP Investor Relations
(346) 616-4138
www.oriongroupholdingsinc.com

Orion Group Holdings, Inc. and Subsidiaries
Condensed Statements of Operations
(In Thousands, Except Share and Per Share Information)
(Unaudited)

		Three months ended								Nine months ended
		September 30,								September 30,
		2022				2021				2022				2021
Contract revenues			182,621				139,907				552,127				439,091
Costs of contract revenues			169,189				133,329				511,548				404,757
Gross profit			13,432				6,578				40,579				34,334
Selling, general and administrative expenses			15,380				15,733				48,783				44,078
Amortization of intangible assets			309				380				929				1,141
Gain on disposal of assets, net			(3,388	)			(792	)			(4,561	)			(9,763	)
Operating income (loss)			1,131				(8,743	)			(4,572	)			(1,122	)
Other (expense) income:
Other income			48				50				147				159
Interest income			36				22				71				73
Interest expense			(1,215	)			(523	)			(2,913	)			(4,506	)
Other expense, net			(1,131	)			(451	)			(2,695	)			(4,274	)
Income (loss) before income taxes			—				(9,194	)			(7,267	)			(5,396	)
Income tax (benefit) expense			(247	)			1,001				396				341
Net income (loss)		$	247			$	(10,195	)		$	(7,663	)		$	(5,737	)
Basic income (loss) per share		$	0.01			$	(0.33	)		$	(0.25	)		$	(0.19	)
Diluted income (loss) per share		$	0.01			$	(0.33	)		$	(0.25	)		$	(0.19	)
Shares used to compute income (loss) per share:
Basic			31,613,519				30,979,207				31,180,417				30,707,426
Diluted			31,613,519				30,979,207				31,180,417				30,707,426

Orion Group Holdings, Inc. and Subsidiaries
Selected Results of Operations
(In Thousands, Except Share and Per Share Information)
(Unaudited)

		Three months ended September 30,
		2022							2021
		Amount				Percent			Amount				Percent
		(dollar amounts in thousands)
Contract revenues
Marine segment
Public sector		$	54,769			72.0		%	$	35,580			65.0		%
Private sector			21,329			28.0		%		19,159			35.0		%
Marine segment total		$	76,098			100.0		%	$	54,739			100.0		%
Concrete segment
Public sector		$	10,070			9.5		%	$	2,301			2.7		%
Private sector			96,453			90.5		%		82,867			97.3		%
Concrete segment total		$	106,523			100.0		%	$	85,168			100.0		%
Total		$	182,621						$	139,907
Operating income (loss)
Marine segment		$	5,197			6.8		%	$	(4,965	)		(9.1	)	%
Concrete segment			(4,066	)		(3.8	)	%		(3,778	)		(4.4	)	%
Total		$	1,131						$	(8,743	)
		Nine months ended September 30,
		2022							2021
		Amount				Percent			Amount				Percent
		(dollar amounts in thousands)
Contract revenues
Marine segment
Public sector		$	164,357			67.7		%	$	121,916			63.9		%
Private sector			78,540			32.3		%		68,911			36.1		%
Marine segment total		$	242,897			100.0		%	$	190,827			100.0		%
Concrete segment
Public sector		$	23,068			7.5		%	$	13,580			5.5		%
Private sector			286,162			92.5		%		234,684			94.5		%
Concrete segment total		$	309,230			100.0		%	$	248,264			100.0		%
Total		$	552,127						$	439,091
Operating income (loss)
Marine segment		$	9,553			3.9		%	$	6,489			3.4		%
Concrete segment			(14,125	)		(4.6	)	%		(7,611	)		(3.1	)	%
Total		$	(4,572	)					$	(1,122	)

Orion Group Holdings, Inc. and Subsidiaries
Reconciliation of Adjusted Net Income (Loss)
(In thousands except per share information)
(Unaudited)

		Three months ended								Nine months ended
		September 30,								September 30,
		2022				2021				2022				2021
Net income (loss)		$	247			$	(10,195	)		$	(7,663	)		$	(5,737	)
One-time charges and the tax effects:
ERP implementation			330				1,383				1,559				2,822
Professional fees related to management transition			310				—				1,118				—
Severance			4				—				944				—
Costs related to debt extinguishment			—				—				—				2,062
Net loss (gain) on Tampa property sale			—				98				—				(6,669	)
Tax rate applied to one-time charges (1)			(183	)			(341	)			(279	)			411
Total one-time charges and the tax effects			461				1,140				3,342				(1,374	)
Federal and state tax valuation allowances			78				689				956				1,659
Adjusted net income (loss)		$	786			$	(8,366	)		$	(3,365	)		$	(5,452	)
Adjusted EPS		$	0.02			$	(0.27	)		$	(0.11	)		$	(0.18	)

 

_________________________
(1) Items are taxed discretely using the Company's effective tax rate which differs from the Company’s statutory federal rate primarily due to state income taxes and the non-deductibility of other permanent items.

Orion Group Holdings, Inc. and Subsidiaries
Adjusted EBITDA and Adjusted EBITDA Margin Reconciliations
(In Thousands, Except Margin Data)
(Unaudited)

		Three months ended								Nine months ended
		September 30,								September 30,
		2022				2021				2022				2021
Net income (loss)		$	247			$	(10,195	)		$	(7,663	)		$	(5,737	)
Income tax expense			(247	)			1,001				396				341
Interest expense, net			1,179				501				2,842				4,433
Depreciation and amortization			6,065				6,225				18,426				19,140
EBITDA (1)			7,244				(2,468	)			14,001				18,177
Stock-based compensation			951				526				2,115				2,154
ERP implementation			330				1,383				1,559				2,822
Professional fees related to management transition			310				—				1,118				—
Severance			4				—				944				—
Net loss (gain) on Tampa property sale			—				98				—				(6,669	)
Adjusted EBITDA(2)		$	8,839			$	(461	)		$	19,737			$	16,484
Operating income margin			0.6		%		(6.2	)	%		(0.8	)	%		(0.2	)	%
Impact of depreciation and amortization			3.3		%		4.4		%		3.3		%		4.4		%
Impact of stock-based compensation			0.5		%		0.4		%		0.4		%		0.5		%
Impact of ERP implementation			0.2		%		1.0		%		0.3		%		0.6		%
Impact of professional fees related to management transition			0.2		%		—		%		0.2		%		—		%
Impact of severance			—		%		—		%		0.2		%		—		%
Impact of net loss (gain) on Tampa property sale			—		%		0.1		%		—		%		(1.5	)	%
Adjusted EBITDA margin(2)			4.8		%		(0.3	)	%		3.6		%		3.8		%

 

_________________________
(1) EBITDA is a non-GAAP measure that represents earnings before interest, taxes, depreciation and amortization.

(2) Adjusted EBITDA is a non-GAAP measure that represents EBITDA adjusted for stock-based compensation, ERP implementation, professional fees related to management transition and severance. Adjusted EBITDA margin is a non-GAAP measure calculated by dividing Adjusted EBITDA by contract revenues.

Orion Group Holdings, Inc. and Subsidiaries
Adjusted EBITDA and Adjusted EBITDA Margin Reconciliations by Segment
(In Thousands, Except Margin Data)
(Unaudited)

		Marine							Concrete
		Three months ended							Three months ended
		September 30,							September 30,
		2022			2021				2022				2021
Operating income (loss)			5,197			(4,965	)			(4,066	)			(3,778	)
Other income			48			50				—				—
Depreciation and amortization			4,192			4,232				1,873				1,993
EBITDA (1)			9,437			(683	)			(2,193	)			(1,785	)
Stock-based compensation			924			509				27				17
ERP implementation			131			571				199				812
Professional fees related to management transition			127			—				183				—
Severance			4			—				—				—
Net loss on Tampa property sale			—			98				—				—
Adjusted EBITDA(2)		$	10,623		$	495			$	(1,784	)		$	(956	)
Operating income margin			6.8	%		(9.0	)	%		(3.9	)	%		(4.4	)	%
Impact of other income			0.1	%		0.1		%		—		%		—		%
Impact of depreciation and amortization			5.5	%		7.7		%		1.8		%		2.3		%
Impact of stock-based compensation			1.2	%		0.9		%		—		%		—		%
Impact of ERP implementation			0.2	%		1.0		%		0.2		%		1.0		%
Impact of net gain on Tampa property sale			—	%		0.2		%		—		%		—		%
Adjusted EBITDA margin (2)			14.0	%		0.9		%		(1.7	)	%		(1.1	)	%
		Marine							Concrete
		Nine months ended							Nine months ended
		September 30,							September 30,
		2022			2021				2022				2021
Operating income (loss)			9,553			6,489				(14,125	)			(7,611	)
Other income			147			159				—				—
Depreciation and amortization			12,751			12,912				5,675				6,228
EBITDA (1)			22,451			19,560				(8,450	)			(1,383	)
Stock-based compensation			2,035			2,079				80				75
ERP implementation			686			1,226				873				1,596
Professional fees related to management transition			492			—				626				—
Severance			944			—				—				—
Net gain on Tampa property sale			—			(6,669	)			—				—
Adjusted EBITDA (2)		$	26,608		$	16,196			$	(6,871	)		$	288
Operating income margin			4.0	%		3.4		%		(4.5	)	%		(3.0	)	%
Impact of other income			0.1	%		0.1		%		—		%		—		%
Impact of depreciation and amortization			5.2	%		6.8		%		1.8		%		2.5		%
Impact of stock-based compensation			0.8	%		1.1		%		—		%		—		%
Impact of ERP implementation			0.3	%		0.6		%		0.3		%		0.6		%
Impact of ISG initiative			0.2	%		—		%		0.2		%		—		%
Impact of severance			0.4	%		—		%		—		%		—		%
Impact of net gain on Tampa property sale			—	%		(3.5	)	%		—		%		—		%
Adjusted EBITDA margin (2)			11.0	%		8.5		%		(2.2	)	%		0.1		%

 

_________________________
(1) EBITDA is a non-GAAP measure that represents earnings before interest, taxes, depreciation and amortization.

(2) Adjusted EBITDA is a non-GAAP measure that represents EBITDA adjusted for stock-based compensation, ERP implementation, professional fees related to management transition and severance. Adjusted EBITDA margin is a non-GAAP measure calculated by dividing Adjusted EBITDA by contract revenues.

Orion Group Holdings, Inc. and Subsidiaries
Condensed Statements of Cash Flows Summarized
(In Thousands)
(Unaudited)

		Three months ended								Nine months ended
		September 30,								September 30,
		2022				2021				2022				2021
Net income (loss)		$	247			$	(10,195	)		$	(7,663	)		$	(5,737	)
Adjustments to remove non-cash and non-operating items			5,095				7,234				20,164				16,738
Cash flow from net income (loss) after adjusting for non-cash and non-operating items			5,342				(2,961	)			12,501				11,001
Change in operating assets and liabilities (working capital)			(7,917	)			(4,074	)			(3,400	)			(6,761	)
Cash flows (used in) provided by operating activities		$	(2,575	)		$	(7,035	)		$	9,101			$	4,240
Cash flows provided by (used in) investing activities		$	803			$	(5,973	)		$	(6,155	)		$	14,489
Cash flows (used in) provided by financing activities		$	(3,580	)		$	11,491			$	(12,502	)		$	(19,425	)
Capital expenditures (included in investing activities above)		$	(2,626	)		$	(6,879	)		$	(10,627	)		$	(11,594	)

Orion Group Holdings, Inc. and Subsidiaries
Condensed Statements of Cash Flows
(In Thousands)
(Unaudited)

		Nine months ended September 30,
		2022				2021
Cash flows from operating activities
Net loss		$	(7,663	)		$	(5,737	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization			16,035				16,881
Amortization of ROU operating leases			3,612				3,967
Amortization of ROU finance leases			2,391				2,259
Write-off of debt issuance costs upon debt modification			—				790
Amortization of deferred debt issuance costs			290				430
Deferred income taxes			20				20
Stock-based compensation			2,115				2,154
Gain on disposal of assets, net			(4,561	)			(9,763	)
Allowance for credit losses			262				—
Change in operating assets and liabilities, net of effects of acquisitions:
Accounts receivable			(21,375	)			10,402
Income tax receivable			(73	)			(64	)
Inventory			(893	)			279
Prepaid expenses and other			6,239				2,006
Contract assets			(7,845	)			14,601
Accounts payable			27,339				(16,841	)
Accrued liabilities			(2,329	)			(5,530	)
Operating lease liabilities			(3,556	)			(3,803	)
Income tax payable			(84	)			(307	)
Contract liabilities			(823	)			(7,504	)
Net cash provided by operating activities			9,101				4,240
Cash flows from investing activities:
Proceeds from sale of property and equipment			4,472				25,643
Purchase of property and equipment			(10,627	)			(11,594	)
Insurance claim proceeds related to property and equipment			—				440
Net cash (used in) provided by investing activities			(6,155	)			14,489
Cash flows from financing activities:
Borrowings on credit			9,000				33,000
Payments made on borrowings on credit			(18,219	)			(49,086	)
Loan costs from Credit Facility			(664	)			—
Payments of finance lease liabilities			(2,235	)			(2,500	)
Purchase of vested stock-based awards			(384	)			(949	)
Exercise of stock options			—				110
Net cash used in financing activities			(12,502	)			(19,425	)
Net change in cash and cash equivalents			(9,556	)			(696	)
Cash and cash equivalents at beginning of period			12,293				1,589
Cash and cash equivalents at end of period		$	2,737			$	893

Orion Group Holdings, Inc. and Subsidiaries
Condensed Balance Sheets
(In Thousands, Except Share and Per Share Information)

		September 30,				December 31,
		2022				2021
		(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents		$	2,737				12,293
Accounts receivable:
Trade, net of allowance for credit losses of $546 and $323, respectively			104,208				88,173
Retainage			46,884				41,379
Income taxes receivable			478				405
Other current			2,912				17,585
Inventory			2,314				1,428
Contract assets			36,374				28,529
Prepaid expenses and other			3,121				8,142
Total current assets			199,028				197,934
Property and equipment, net of depreciation			101,774				106,654
Operating lease right-of-use assets, net of amortization			15,358				14,686
Financing lease right-of-use assets, net of amortization			16,240				14,561
Inventory, non-current			5,425				5,418
Intangible assets, net of amortization			7,627				8,556
Deferred income tax asset			22				41
Other non-current			2,682				3,900
Total assets		$	348,156			$	351,750
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current debt, net of issuance costs		$	29,892			$	39,141
Accounts payable:
Trade			74,740				48,217
Retainage			1,318				923
Accrued liabilities			23,257				38,594
Income taxes payable			517				601
Contract liabilities			26,175				26,998
Current portion of operating lease liabilities			4,618				3,857
Current portion of financing lease liabilities			3,821				3,406
Total current liabilities			164,338				161,737
Long-term debt, net of debt issuance costs			787				259
Operating lease liabilities			11,515				11,637
Financing lease liabilities			11,753				10,908
Other long-term liabilities			17,427				18,942
Deferred income tax liability			170				169
Interest rate swap liability			—				—
Total liabilities			205,990				203,652
Stockholders’ equity:
Preferred stock -- $0.01 par value, 10,000,000 authorized, none issued			—				—
Common stock -- $0.01 par value, 50,000,000 authorized, 32,766,116 and 31,712,457 issued; 32,054,885 and 31,001,226 outstanding at September 30, 2022 and December 31, 2021, respectively			328				317
Treasury stock, 711,231 shares, at cost, as of September 30, 2022 and December 31, 2021, respectively			(6,540	)			(6,540	)
Accumulated other comprehensive loss			—				—
Additional paid-in capital			187,601				185,881
Retained loss			(39,223	)			(31,560	)
Total stockholders’ equity			142,166				148,098
Total liabilities and stockholders’ equity		$	348,156			$	351,750

FAQ

What were Orion Group Holdings' earnings for Q3 2022?

Orion Group Holdings reported a net income of $0.2 million ($0.01 diluted EPS) for Q3 2022.

How much did Orion Group Holdings' contract revenues increase in Q3 2022?

Contract revenues increased by 30.5% to $182.6 million in Q3 2022.

What is Orion Group Holdings' backlog as of September 30, 2022?

The backlog of work under contract as of September 30, 2022, was $548.6 million.

What significant management changes occurred at Orion Group Holdings?

Orion Group added Travis Boone as CEO and Scott Thanisch as CFO to enhance its management team.

What is the purpose of the $10.5 million sale-leaseback agreement announced by Orion Group?

The agreement for the Port Lavaca property aims to monetize real estate assets and is expected to close in December.