OHM CORPORATION REPORTS $0.03 PER SHARE FOR Q1 1993 VS $0.01 A YEAR AGO; CITES IMPROVED PROFITABILITY IN ITS REMEDIATION BUSINESS; EXPECTS POSITIVE COMPARISONS FOR EACH OF THE REMAINING QUARTERS IN 1993
FINDLAY, Ohio, May 3 /PRNewswire/ -- OHM Corporation (NYSE: OHM), a leading on-site hazardous waste remediation services firm today reported consolidated earnings per share of three cents for the first quarter of 1993, compared to one cent for the same period in 1992. Commenting on the results, James L. Kirk, chairman, president and chief executive officer of OHM Corporation, said, "We are pleased that we were profitable in the first quarter in spite of continued economic weakness and weather conditions which caused delays in new project starts." Kirk cited lower interest expense, cost controls and higher project margins in its remediation business as the primary reasons for the increase in earnings per share. On a consolidated basis net revenues declined 8 percent to $44.0 million for the first quarter of 1993 from $47.7 million for the first quarter of 1992. Operating income for the quarter increased 4 percent to $2.6 million from $2.5 million for the same period in 1992. The company also had a record obligated backlog of $168 million at March 31, 1993, a 37 percent increase over backlog at March 31, 1992, and the value of the total potential backlog, including government term contracts, was $421 million compared to $334 million a year ago.
IMPROVED PERFORMANCE IN REMEDIATION BUSINESS
Overall, net revenues from the company's remediation business declined 9 percent for the first quarter of 1993 compared to the first quarter of 1992, while operating income increased slightly. The volume of business was negatively affected by inclement weather conditions and weaker demand from the private sector. The increase in operating income is primarily attributed to cost controls and higher project margins for the first quarter of 1993, as compared to the first quarter of 1992. Kirk said, "We believe our ability to improve earnings in our seasonally weakest quarter is a healthy sign. We have focused on developing a balanced portfolio of clients in both the public and private sectors and made significant investments over the last three years to be able to deliver our services in the sunbelt regions. We believe this strategy has served to minimize the effects of weakness in particular geographic territories or sectors of the economy. Another strategy has been to bid on large, long-term projects. Large projects produce more predictable revenues given their longer duration and they allow us to more effectively utilize our equipment and personnel resources." Kirk added, "We've waited a long time for studies of hazardous waste sites to give way to cleanups. We believe this transition has finally begun and is evidenced by the large, long-term projects recently awarded to the Company, and the additional large opportunities we are pursuing in 1993. We have several large cleanup contracts at Superfund sites in our obligated backlog for which field work has commenced. These include the $58 million Baird & McGuire project in Holbrook, Massachusetts and our $35 million share of the Bayou Bonfouca project in Slidell, Louisiana. In addition, we have two projects at a Department of Energy Weldon Spring site in St. Charles, Missouri that have a combined potential value of $22 million. We also expect a significant increase in business from the 12 term contracts we have in place with government agencies for environmental cleanup primarily at military sites. "We are optimistic about our growth prospects for the next several years. We believe our revenues will grow 20 percent to 25 percent per year. With our investment in the sunbelt regions largely in place, we expect operating margins to continue to expand in these regions as incremental revenues are added. In each of the remaining quarters of 1993, we expect to have improved earnings as compared to last year," said Kirk.
ASBESTOS SUBSIDIARY REPORTS SLIGHTLY LOWER EARNINGS
In an announcement last week, OHM's 70 percent owned asbestos abatement subsidiary, NSC Corporation, reported earnings per share for its first quarter of 10 cents as compared to 13 cents a year ago. NSC's results are included on a fully consolidated basis with those of OHM for the first quarter.
NSC/BRAND TRANSACTION PART OF OHM LONG-TERM STRATEGY
The previously announced transaction between NSC and The Brand Companies, Inc. is expected to be completed this week. As a result of the transaction, OHM's ownership interest in NSC will decline to 41 percent from 70 percent. During the second quarter of this year, OHM will begin to account for NSC through the equity method. Kirk said, "We expect NSC's contribution will be additive to earnings for the remainder of this year." Kirk stated, "Several years ago, OHM determined that the on-site hazardous waste clean-up business held the greatest potential for the Company's long-term growth and profitability and we have pursued a strategic plan to focus on and strengthen our remediation business." In a series of transactions since 1991, OHM sold or reduced its ownership interest in numerous businesses not directly related to its core remediation business. Kirk added, "OHM will have generated a cumulative $41 million in cash through these transactions, including approximately $13 million in intercompany loans to be repaid by NSC when its transaction with Brand is completed. These funds have been, and will continue to be, used to invest in our on-site remediation business." With 24 years experience and the successful completion of more than 16,000 projects, OHM Corporation is a leading nationwide environmental remediation firm and a major emergency response contractor, providing a broad range of physical, chemical and biological treatment technologies to clean up hazardous waste through its 30 locations in the United States. OHM provides its services to a diverse client base in the private sector, including petroleum, chemical, transportation, general manufacturing firms and conglomerates as well as the public sector including the U.S. Army Corps of Engineers, the U.S. Department of the Air Force, the U.S. Department of the Navy, the U.S. EPA and at U.S. Department of Energy facilities. OHM CORPORATION CONSOLIDATED SUMMARY FINANCIAL RESULTS (In Thousands, Except Per Share Data) As Reported QUARTER ENDED MARCH 31: 1993 1992 (Unaudited) Gross Revenues $57,975 $64,704 Net Revenues 44,028 47,676 Operating Income 2,556 2,456 Net Income From Continuing Operations 331 94 Discontinued Operations: Income From Operations --- 4 Provision For Loss On Disposition --- --- Cumulative Effect of Accounting Change (A) --- (857) Net Income (Loss) 331 (759) Net Income (Loss) Per Share: Continuing Operations $0.03 $0.01 Discontinued Operations: From Operations --- --- From Disposition --- --- Cumulative Effect of Accounting Change (A) --- (0.07) Net Income (Loss) Per Share $0.03 $(0.06) Weighted Average Number of Common and Common Equivalent Shares Outstanding 12,215 12,058 NOTE A: Related to the adoption of Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes." -0- 5/3/93 /CONTACT: Sam Iapalucci, 419-424-4924, or Pamela K. M. Beall, 419-425-6002 (investor); or Cheryl Rectorschek, 419-424-4929 (media); all of OHM Corporation/ (OHM)
CO: OHM Corporation ST: Ohio IN: ENV SU: ERN
KL -- CL022 -- 3760 05/03/93 11:46 EDT
|Printer friendly Cite/link Email Feedback|
|Date:||May 3, 1993|
|Previous Article:||KODAK NAMES ACTING CFO; EXTERNAL SEARCH UNDER WAY|
|Next Article:||AMGEN APPOINTS PETER TEELEY VP, GOVERNMENT AND PUBLIC RELATIONS; ANNOUNCES PLANS TO OPEN WASHINGTON OFFICE|