In the first quarter of 2015, ENGlobal Corp. (NASDAQ: ENG) demonstrated its versatility, expertly navigating the recent downturn in energy commodity prices despite the market’s softness.
“We have pared the Company down to a smaller, more focused operation and reduced the risk profile of the projects we are undertaking, in addition to controlling overhead costs,” stated William Coskey, Chairman and Chief Executive Officer of ENGlobal. “These and other actions have allowed the Company to remain profitable, with positive cash flow during this downturn.”
ENGlobal’s Engineering and Construction group aided in these promising results, recording over 57 percent of the company’s total revenue for the quarter while receiving a gross profit margin of 15.5 percent by providing a host of engineering, procurement, and construction management (EPCM) services. In recent years, the company’s global reputation for consistently designing and delivering complex midstream and downstream products has allowed ENGlobal to carve out sustainable market share within the industry. This strong growth and history of providing quality work has allowed the company to maintain a constant presence on Engineering News Record’s annual list of the Top 500 engineering design firms for more than a decade.
In addition to a world-class safety performance record, the company’s Engineering and Construction group has attained multiple alliance agreements with leading industry clients. ENGlobal’s comprehensive range of services, which includes everything from feasibility studies and conceptual design to turnkey project responsibility, should ensure that the company continues to improve its financial results alongside a recovering energy market.
“While there is always room for improvement, I believe we are in a strong financial position and poised for future growth,” stated Mark Hess, Chief Financial Officer of ENGlobal. “We ended the first quarter with a healthy cash balance and working capital of $24.4 million, and have no borrowings under our current credit facility.”
The company’s ability to remain profitable despite the continued softness of the energy sector is a testament to the quality of ENGlobal’s leadership team, and this leadership will remain imperative as market conditions make initial movements towards recovery. Moving forward, it appears likely that a continued focus on minimized overhead costs and low risk projects will be vital to the company’s financial success in the months to come. As gasoline prices continue to hover near their highest point since late in 2014, ENGlobal’s growth will likely depend on the sustained improvement of overall project activity in the energy sector.
For more information, visit www.englobal.com
