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MORRISON KNUDSEN REPORTS FIRST QUARTER EARNINGS; ACHIEVES RECORD BACKLOG

 MORRISON KNUDSEN REPORTS FIRST QUARTER EARNINGS;
 ACHIEVES RECORD BACKLOG
 BOISE, Idaho, April 16 /PRNewswire/ -- Morrison Knudsen Corp. (MK) (NYSE: MRN) today reported net income of $6.4 million (44 cents per share) on revenue of $498 million for the first quarter ended March 31, 1992. Revenue and net income for the first quarter of 1991 (restated to show the effects of the Motor Coils acquisition) was $452 million and $8.9 million (69 cents per share), respectively.
 Backlog continued record growth and reached a new high of $4.8 billion, an increase of 18 percent over the $4 billion in backlog at March 31, 1991.
 "As anticipated, our rail systems first quarter earnings were lower than first quarter earnings last year because transit cars now in production will not be shipped to customers until the third quarter at which time this segment's performance is expected to improve," said William J. Agee, chairman and chief executive officer of MK. "During the second half of last year and the first quarter of this year we incurred significant expenses obtaining new work which will generate revenue in the future. It is not unusual in our business for revenues temporarily to lag expenses in this fashion. Much of the gain we expect from recent contract awards will not be realized until the second half of the year and beyond. Backlog, the basis of future earnings, is very solid in each of our business sectors and our transportation business is particularly strong."
 Financial highlights for the quarter included the award of a $380-million contract from Metra, a commuter rail system serving northeastern Illinois. The contract, the largest transit-car order in MK history and one of the largest in U.S. history, calls for the manufacture of 173 new transit cars and the remanufacture of an additional 140 existing transit cars. MK is in the process of establishing a rail manufacturing facility in Chicago to complement its New York facility and to serve transit needs in the Midwest.
 MK also was selected for a $155-million contract to build 88 new transit cars for the California Department of Transportation (Caltrans), with options for up to 260 additional cars. Soon thereafter, on March 17, the company was awarded a $141.6-million contract from the Bay Area Rapid Transit District (BART) to manufacture 80 new transit cars for the San Francisco Bay Area commuter system. Options for additional cars could bring total production to 250 vehicles. These contracts will be substantially filled at a facility that MK will establish in the Bay Area.
 MK's California plant, in conjunction with the new facility in Chicago and its existing facility in Hornell, New York, positions the company to serve the transit-car needs of clients coast to coast and around the world.
 In a related transportation event, an MK-led joint venture was selected by Amtrak to design and build a $295-million railroad electrification system from New Haven, Conn., to Boston. This award, which is not included in first quarter backlog, includes a $25-million design effort which will commence in May. MK holds a 60-percent interest in the venture.
 On March 31, 1992, the company signed an exclusive agreement with Caterpillar Inc. to use state-of-the-art Caterpillar engines in the development of three classes of new railroad locomotives, not now available in the market, to be manufactured by MK. This agreement allows MK to further broaden its transportation product lines. "We see a promising market for new locomotives over the next eight to 10 years, particularly LNG-powered engines, and this agreement brings together two companies with long and successful histories in the rail business," Agee said.
 Also during the quarter, MK received notice of award of an estimated $24-million contract to rebuild a war-damaged air base in Kuwait. The company was apparent low bidder for a contract in excess of $50 million for an ocean outfall pipeline in San Diego. MK signed a contract with B&W Nuclear Service Company (BWNS) and Duke Engineering & Services, Inc. (DE&S), creating a team that will provide steam generator replacement services to the U.S. commercial nuclear power industry.
 Morrison Knudsen Corp. is an international company serving the environmental, industrial process, power and transportation markets with complete development, design/engineering, construction, operating and financial services.
 MORRISON KNUDSEN CORP.
 FINANCIAL HIGHLIGHTS
 (Thousands of dollars except share data)
 Quarter ended March 31: 1992 1991 (a)
 Revenue:
 Engineering and construction $455,250 $334,652
 Rail systems 43,093 117,498
 Total revenue $498,343 $452,150
 Operating income (loss):
 Engineering and construction $15,051 $18,062
 Rail systems (1,101) 6,735
 Total operating income 13,950 24,797
 Equity in and interest earned from
 McConnell Dowell and other affiliates 1,421 243
 Other income - net 8,483 5,741
 General and administrative expense (9,833) (11,599)
 Interest expense (3,583) (3,749)
 Income before income taxes 10,438 15,433
 Income tax expense (b) (4,075) (6,526)
 Net income $ 6,363 $ 8,907
 Earnings per common and
 common equivalent share $ 0.44 $ 0.71
 Earnings per common share-
 assuming full dilution (c) 0.44 0.69
 New business booked in period:
 Engineering and construction $ 334,100 $546,600
 Rail systems 677,100 18,400
 Total new business $1,011,200 $565,000
 Backlog at March 31: 1992 1991
 Engineering and construction $3,724,600 $3,442,700
 Rail systems 1,038,300 594,300
 Total backlog $4,762,900 $4,037,000
 (a) Restated to include the results of operations of a business
 acquired in October 1991 accounted for as a pooling-of-
 interests.
 (b) The effective tax rate for the quarter ended March 31, 1992,
 was 39 percent compared with 42 percent for the quarter ended
 March 31, 1991. The decrease in the effective tax rate for
 the quarter ended March 31, 1992, is due to increases in the
 non-taxable portion of dividend income and tax credits.
 (c) The convertible debt is antidilutive for the quarter ended
 March 31, 1992, and conversion is not assumed because the
 interest, net of tax, per common share obtainable on
 conversion exceeds the earnings per share computed without
 assuming conversion.
 -0- 4/16/92
 /CONTACT: Jess Hawley of Morrison Knudsen, 208-386-5000/
 (MRN) CO: Morrison Knudsen Corp. ST: Idaho IN: CST TRN SU: ERN


LM -- SE009 -- 9341 04/16/92 13:26 EDT
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Publication:PR Newswire
Date:Apr 16, 1992
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