BATON ROUGE, La., Oct 14, 2002 (BUSINESS WIRE) -- The Shaw Group Inc.
(NYSE:SGR) ("Shaw" or "the Company") today announced a 62% increase in earnings
to $31.3 million, or $0.70 per diluted share, for the three months ended August
31, 2002. This compares to earnings of $19.3 million, or $0.45 per diluted
share, for the three months ended August 31, 2001. Fourth quarter fiscal 2002
revenue increased 224% reaching $1.2 billion, compared to $385.7 million for the
fourth quarter of fiscal 2001.
For the year ended August 31, 2002, the Company reported a 61% increase in
earnings to $98.4 million, or $2.26 per diluted share. This compares to earnings
of $61.0 million, or $1.46 per diluted share for the year ended August 31, 2001.
Revenue for the year ended August 31, 2002 increased 106% to $3.2 billion,
compared to $1.5 billion in revenue for the year ended August 31, 2001.
Shaw's backlog totaled $5.6 billion at August 31, 2002, representing a 25%
increase over the $4.5 billion backlog reported at August 31, 2001.
Approximately 47%, or $2.6 billion, is expected to be worked off during the next
12 months. Ninety-one percent of Shaw's backlog is for projects in the United
States.
"Our strong balance sheet and project execution skills have allowed us to
produce record results for another fiscal year," stated J. M. Bernhard, Jr.,
Shaw's Chairman, President and Chief Executive Officer. "Shaw's diversified
portfolio, including our process and environmental & infrastructure operations,
as well as our nuclear and other power services, provides a recurring revenue
base and level of stability to our operations going forward."
Shaw has completed the repurchase of approximately $100 million of its common
stock, authorized by its Board of Directors on September 14, 2001, totaling
approximately 5.3 million shares. This includes approximately 3.2 million shares
purchased in the first of quarter of fiscal 2003, 1.0 million shares in the
fourth quarter of fiscal 2002 and 1.1 million shares purchased in previous
quarters.
To reflect the downturn in the domestic power generation market, including the
potential loss of future profits in connection with the LSP-Pike Energy LLC
("Pike") project, and the PG&E; National Energy Group ("NEG"), a subsidiary of
PG&E; Corporation (NYSE: PCG), Harquahala and Covert projects, Shaw is revising
its earnings guidance for fiscal year 2003 to a range of $1.92 to $2.08 per
diluted share, from its previous earnings guidance in the range of $2.72 to
$3.00 per diluted share. Accordingly, the Company expects revenue to be in the
range of $2.8 to $2.9 billion for its fiscal year 2003. Previous revenue
guidance for fiscal year 2003 was in the range of $3.3 billion to $3.8 billion.
On a quarterly basis, diluted earnings per share for fiscal 2003 are expected to
be in the range of $0.40 to $0.44 for the first quarter, $0.34 to $0.38 for the
second quarter, $0.51 to $0.55 for the third quarter and $0.67 to $0.71 for the
fourth quarter. This guidance assumes approximately 45 million dilutive shares
outstanding. Quarterly revenue is expected to be in the range of $720 to $760
million for the first quarter, $620 to $660 million for the second quarter, $650
to $690 million for the third quarter and $760 to $800 million for the fourth
quarter.
While the Pike project was removed from Shaw's backlog during the fourth
quarter; revenues remaining in backlog from the NEG projects as of August 31,
2002 of approximately $372 million, will be taken out of backlog when it is
determined that the projects will not move forward to completion.
Mr. Bernhard stated, "Although we recognize that varying challenges surround the
economy and our business at present forcing us to conservatively lower
expectations for fiscal 2003, we are confident that our proven track record, and
ability to quickly adapt to market changes, will allow our Company to continue
to prosper in the years ahead."
On August 5, 2002, Shaw announced that it had entered into an agreement with
Pike and its parent NRG Energy, Inc. ("NRG"), a subsidiary of Xcel Energy, Inc.
(NYSE: XEL), to acquire substantially all of the assets of the Pike project in
exchange for forgiveness of sums owed to the Company, and the payment of $43
million by the Company to NRG. The Board of NRG and its lenders have not given
final approval to the agreement. Although the agreement has expired by its
terms, the Company remains in talks with NRG and its lenders.
The Shaw Group Inc. is the world's only vertically-integrated provider of
comprehensive engineering, procurement, pipe fabrication, construction and
maintenance services to the power, process and environmental & infrastructure
sectors. Shaw is headquartered in Baton Rouge, Louisiana, and currently has
offices and operations in North America, South America, Europe, the Middle East
and Asia-Pacific. Shaw employs more than 20,000 people annually. Additional
information on The Shaw Group is available at www.shawgrp.com.
The Private Securities Litigation Reform Act of 1995 provides a "safe harbor"
for certain forward-looking statements. The statements contained herein that are
not historical facts (including without limitation statements to the effect that
the Company or its management "believes," "expects," "anticipates," "plans," or
other similar expressions) and statements related to revenues, earnings,
backlog, or other financial information or results are forward-looking
statements based on the Company's current expectations and beliefs concerning
future developments and their potential effects on the Company. There can be no
assurance that future developments affecting the Company will be those
anticipated by the Company. These forward-looking statements involve significant
risks and uncertainties (some of which are beyond our control) and assumptions
and are subject to change based upon various factors. Should one or more of such
risks or uncertainties materialize, or should any of our assumptions prove
incorrect, actual results may vary in material respects from those projected in
the forward-looking statements. The Company undertakes no obligation to publicly
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise. A description of some of the risks and
uncertainties that could cause actual results to differ materially from such
forward-looking statements can be found in the Company's reports and
registration statements filed with the Securities and Exchange Commission,
including its Form 10-K and Form 10-Q, reports and on the Company's web-site
under the heading "Forward Looking Statement". These documents are also
available from the Securities and Exchange Commission or from the Investor
Relations department of Shaw. For more information on the company and
announcements it makes from time to time on a regional basis visit our web site
at www.shawgrp.com.
The Shaw Group Inc.
Consolidated Statements of Income
(In thousands, except per share amounts)
Three Months Ended Twelve Months Ended
August 31, August 31,
-------------------- ----------------------
2002 2001 2002 2001
---------- -------- ---------- ----------
Income:
Sales $1,248,220 $385,738 $3,170,696 $1,538,932
Cost of sales 1,137,007 322,238 2,843,070 1,292,316
---------- -------- ---------- ----------
Gross profit 111,213 63,500 327,626 246,616
General and
administrative
expenses 54,914 28,044 161,248 122,601
Goodwill amortization -- 4,962 -- 17,059
---------- -------- ---------- ----------
Total general and
administrative
expenses 54,914 33,006 161,248 139,660
Operating income 56,299 30,494 166,378 106,956
Interest expense (5,920) (5,673) (23,028) (15,680)
Interest income 2,125 5,097 11,518 8,746
Other income, net (3,616) 958 (3,833) (477)
---------- -------- ---------- ----------
(7,411) 382 (15,343) (7,411)
---------- -------- ---------- ----------
Income before income
taxes and earnings
(losses) from
unconsolidated
entities 48,888 30,876 151,035 99,545
Provision for income
taxes 17,575 11,588 54,348 38,232
---------- -------- ---------- ----------
Income before earnings
(losses) from
unconsolidated entities 31,313 19,288 96,687 61,313
Earnings (losses) from
unconsolidated entities
(net of taxes) 32 41 1,680 (316)
---------- -------- ---------- ----------
Net Income $ 31,345 $ 19,329 $ 98,367 $ 60,997
========== ======== ========== ==========
Basic income per common share:
Net income available
to common
shareholders $ 31,345 $ 19,329 $ 98,367 $ 60,997
========== ======== ========== ==========
Number of shares 41,415 40,990 40,834 40,127
========== ======== ========== ==========
Net income per
common share $ 0.76 $ 0.47 $ 2.41 $ 1.52
========== ======== ========== ==========
Diluted income per common share:
Net income available
to common
shareholders $ 31,345 $ 19,329 $ 98,367 $ 60,997
Interest on
convertible debt,
net of taxes 2,690 2,507 10,697
---------- -------- ---------- ----------
Net income for
diluted
computation $ 34,035 $ 21,836 $ 109,064 $ 60,997
========== ======== ========== ==========
Number of shares 48,683 48,872 48,238 41,828
========== ======== ========== ==========
Diluted income per
common share $ 0.70 $ 0.45 $ 2.26 $ 1.46
========== ======== ========== ==========
REVENUE AND BACKLOG BY INDUSTRY AND GEOGRAPHY
Revenue by Industry
(Fourth Quarter Ended August 31, 2002)
Power Generation $ 831.1 million 67 %
Environmental & Infrastructure $ 235.5 million 19 %
Process Industries $ 101.5 million 8 %
Other Industries $ 80.1 million 6 %
----------------- -----
Total $ 1,248.2 million 100 %
Revenue by Geography
(Fourth Quarter Ended August 31, 2002)
United States $ 1,131.5 million 91 %
Other North American $ 37.6 million 3 %
Asia/Pacific Rim $ 37.0 million 3 %
Europe $ 27.7 million 2 %
South America $ 7.1 million 1 %
Other $ 4.2 million 0 %
Middle East $ 3.1 million 0 %
----------------- -----
Total $ 1,248.2 million 100 %
Revenue by Industry
(Year Ended August 31, 2002)
Power Generation $ 2,246.2 million 71 %
Environmental & Infrastructure $ 425.3 million 13 %
Process Industries $ 282.4 million 9 %
Other Industries $ 216.8 million 7 %
----------------- -----
Total $ 3,170.7 million 100 %
Revenue by Geography
(Year Ended August 31, 2002)
United States $ 2,756.3 million 87 %
Asia/Pacific Rim $ 148.3 million 5 %
Other North American $ 108.2 million 3 %
Europe $ 103.7 million 3 %
South America $ 27.8 million 1 %
Other $ 15.6 million 1 %
Middle East $ 10.8 million 0 %
----------------- -----
Total $ 3,170.7 million 100 %
Backlog by Industry
(At August 31, 2002)
Power Generation
Nuclear Power $ 1,189.1 million 21 %
Fossil Fuel EPC $ 998.9 million 18 %
Other Power $ 459.5 million 8 %
Environmental & Infrastructure $ 2,360.3 million 42 %
Process Industries $ 495.4 million 9 %
Other Industries $ 101.5 million 2 %
----------------- -----
Total $ 5,604.7 million 100 %
Backlog by Geography
(At August 31, 2002)
Domestic $ 5,080.9 million 91 %
International $ 523.8 million 9 %
----------------- -----
Total $ 5,604.7 million 100 %
The Shaw Group Inc.
CONTACT: The Shaw Group Inc., Baton Rouge
Christine N. Mollere, 225/932-2500
www.shawgrp.com
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