Conrad Industries, Inc. Reports 1999 Second Quarter Results.

MORGAN CITY, La.--(BUSINESS WIRE)--Aug. 4, 1999--

Conrad Industries, Inc. (Nasdaq: CNRD) reported net income of $692,000 and earnings per share of $0.10 for the quarter ended June 30,1999 and net income of $1.5 million and earnings per share of $0.22 for the six months ended June 30, 1999.

The Company had net income of $1.0 million and earnings per share of $0.18 for the quarter ended June 30, 1998. Due to a non-cash executive compensation charge of $4.7 million, a net loss of $1.5 million and loss per share of $0.29 was incurred for the six months ended June 30, 1998.

EBITDA was $1.8 million or 21.1% of revenue for the quarter ended June 30, 1999 and $3.9 million or 21.6% of revenue for the six months ended June 30, 1999. This compares with EBITDA of $3.4 million or 27.6% of revenue for the quarter ended June 30, 1998 and $6.5 million or 27.2% of revenue for the six months ended June 30, 1998.

Revenues for the quarter and six months ended June 30, 1999 were $8.7 million and $18.2 million, respectively. Revenues for the quarter and six months ended June 30, 1998 were $12.4 million and $24.0 million, respectively.

William H. Hidalgo, President and CEO stated that "Our vessel construction profit margins remain steady due to our diversity of projects and markets. Our repair and conversion segment experienced weak demand and price pressures during the current quarter but we are cautiously optimistic about an increase by the end of the year. During the past month we have signed contracts or have received commitments on $8.4 million in projects. We have also been notified that appropriations for three additional U.S. Army ST Tugs with a value of $7.2 million have been made."

Hidalgo stated "We celebrated the one year anniversary of our Company's initial public offering during the current quarter and although the energy markets have been challenging, we are looking forward to improving conditions in the energy markets in the last quarter of the year."

Conrad, founded in 1948, specializes in the construction, conversion and repair of marine vessels for commercial and government customers and the fabrication of modular components of offshore drilling rigs and floating production, storage and off loading vessels. The Company currently operates three shipyards located along the Gulf Coast in Morgan City and Amelia, Louisiana and Orange, Texas.

This press release contains forward-looking statements that are subject to a number of risks, uncertainties and assumptions, many of which are beyond the control of Conrad Industries, Inc. Should one or more of these risks, uncertainties or assumptions materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those anticipated, estimated or projected. These and other risks and assumptions are discussed in Conrad Industries, Inc.'s filings with the Securities and Exchange Commission, including Conrad Industries, Inc.'s Form 10-K.

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Conrad Industries, Inc. Summary Results of Operations
    (In thousands, except per share amounts)

                              Three months ended   Six months ended
                              ------------------  ------------------
                                    June 30,           June 30,
                                1999      1998      1999      1998
                              --------  --------  --------  --------
Statement of Operations Data:
Revenues
  Vessel construction         $  6,758  $  7,944  $ 13,883  $ 16,548
  Repair and conversions         1,952     4,474     4,287     7,439
                              --------  --------  --------  --------
     Total revenues              8,710    12,418    18,170    23,987
                              --------  --------  --------  --------
Cost of revenue:
  Vessel construction            4,831     5,688     9,905    11,846
  Repair and conversions         1,588     2,981     3,484     4,963
                              --------  --------  --------  --------
     Total cost of revenue       6,419     8,669    13,389    16,809
                              --------  --------  --------  --------
Gross profit
  Vessel construction            1,927     2,256     3,978     4,702
  Repair and conversions           364     1,493       803     2,476
                              --------  --------  --------  --------
     Total gross profit          2,291     3,749     4,781     7,178
SG&A                             1,011       885     1,990     1,773
Non-Cash Executive
 Compensation (1)                 --         359      --       4,675
                              --------  --------  --------  --------
Income from operations           1,280     2,505     2,791       730
Interest Expense                   161       502       339     1,005
Other expenses (income), net       (57)      (86)     (123)     (179)
                              --------  --------  --------  --------
Income (loss) before
 income taxes                    1,176     2,089     2,575       (96)
Provision for income taxes         484       410     1,051       703
Provision for cumulative
 deferred taxes                   --         675      --         675
                              --------  --------  --------  --------
Net Income (loss)             $    692  $  1,004  $  1,524  $ (1,474)
                              ========  ========  ========  ========

Net income (loss) per
 common share:
    Basic and diluted         $   0.10  $   0.18  $   0.22  $  (0.29)
Weighted average common
 shares outstanding:
    Basic and diluted            7,078     5,662     7,078     5,167

Pro Forma Data:
Income (loss) before income
 taxes as reported above      $  1,176  $  2,089  $  2,575  $    (96)
Pro forma provision for
 income taxes (2)                  484     1,009     1,051     1,427
                              --------  --------  --------  --------
Pro forma net income (loss)   $    692  $  1,080  $  1,524  $ (1,523)
                              ========  ========  ========  ========

Pro forma net income (loss)
 per share                    $   0.10  $   0.17  $   0.22  $  (0.25)
Common and equivalent
 shares outstanding (3)          7,078     6,367     7,078     5,977

EBITDA (4)                    $  1,839  $  3,422  $  3,917  $  6,513
EBITDA as a percent of revenue    21.1%     27.6%     21.6%     27.2%

Depreciation & Amortization:
  Vessel construction         $    195  $    203  $    398  $    402
  Repair and conversions           131       134       262       250
  Included in SG&A                 233       221       466       456
                              --------  --------  --------  --------
    Total depreciation &
     amortization             $    559  $    558  $  1,126  $  1,108
                              ========  ========  ========  ========

(1)    Represents non-cash executive compensation expense related to
       the issuance of shares of common stock to executives by Conrad
       in the first quarter of 1998.

(2)    Pro forma data gives effect to the application of federal and
       state income taxes to the Company as if were a C corporation
       for tax purposes during all periods presented.

(3)    1998 includes shares sold in the initial public offering
       sufficient to fund a $10 million distribution of undistributed
       earnings to stockholders prior to the termination of the
       Company's S Corporation status.

(4)    Represents income from operations before deduction of
       depreciation, amortization and non-cash compensation expense
       related to the issuance of stock and stock options to
       employees. This is a non-GAAP supplemental financial
       measurement used by the Company.