Newspaper article THE JOURNAL RECORD

Electrical Segment Short-Circuits Matrix Profits

Newspaper article THE JOURNAL RECORD

Electrical Segment Short-Circuits Matrix Profits

Article excerpt

TULSA - Matrix Service Co. reported that second-quarter profits tumbled 68 percent compared to the same period last year due to a loss in its electrical infrastructure segment.

Despite the drop in quarterly profits, which was a challenge, Matrix President and CEO John R. Hewitt remained confident for the rest of the year. The strength in the company's three other segments bolstered revenues. The company's fiscal year begins on July 1 and the second quarter ended on Dec. 31, 2014.

Companywide, second-quarter revenues increased $31.9 million, or 10.3 percent, to $342.9 million, compared to $311 million in the same period a year earlier. Analysts expected $369.56 million in revenue, said Qian Zhang, investment manager, Fredric E. Russell Investment Management Co.

"Our performance and outlook remain strong," Hewitt said.

The second-quarter profit decline was due to a joint venture engineering, procurement and construction, or EPC, project on the East Coast that had a negative effect on earnings.

The joint venture project was in the electrical infrastructure segment, Hewitt said. Matrix's share of the acquired EPC joint venture costs cut second-quarter profits by $7.9 million to $3.3 million. The charge reduced fully diluted earnings per share by 29 cents to 12 cents. In the same period a year earlier, the company earned $10.3 million, or 38 cents per fully diluted share.

The charge came from client supply delays, technical issues and additional work that hampered the company's ability to meet deadlines, Hewitt said. He declined to name the joint venture partner or the client. The project is scheduled to be completed by June 30.

The electrical infrastructure segment suffered an $18.5 million loss in the quarter, despite revenues climbing 56 percent. The electrical infrastructure revenues were $58.5 million in the quarter, compared to $37 million for the prior-year period. …

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