Goldfield Announces Second Quarter Results
MELBOURNE, Fla., Aug. 14 /PRNewswire-FirstCall/ -- The Goldfield Corporation (Amex: GV), a leading provider of electrical construction services in the southeastern United States and a developer of condominiums, today announced results for the three and six months ended June 30, 2007.
Revenues for the six months ended June 30, 2007 were $11.2 million and the Company had an operating loss of $2.0 million, compared to revenues of $26.2 million and operating income of $3.4 million in the six months ended June 30, 2006.
Revenues for the three months ended June 30, 2007 were $1.4 million and the Company had an operating loss of $1.5 million, compared to revenues of $12.2 million and operating income of $1.5 million in the three months ended June 30, 2006.
Revenues in both the three months and six months ended June 30, 2007 reflect decreases in both the electrical construction segment and the real estate development segment. The decrease in the electrical construction segment revenues was primarily due to a slowdown in demand for the Company's electrical construction services. The decrease in the real estate development segment revenues was due to the reversal of revenues previously recognized as a result of customers defaulting or providing notification of their intent to default on their contractual obligations to close the purchase of condominium units in the Pineapple House project, which was completed in June 2007.
For the three and six months ended June 30, 2007, the electrical construction segment had operating income of $875,000 and $684,000, respectively, compared to $2.1 million and $3.9 million, respectively, in the comparable prior year periods. The real estate development segment had operating losses of $1.7 million and $1.1 million, respectively, for the three and six months ended June 30, 2007, compared to operating income of $93,000 and $987,000, respectively, in the three and six months ended June 30, 2006. In both cases these decreases were primarily due to the same factors that affected revenues as described above and, with respect to the electrical construction segment, unanticipated costs associated with customer initiated delays arising during the course of certain of the Company's current projects. In the real estate development segment there was a corresponding reversal of previously recognized cost of goods sold and selling expenses associated with the customer contract defaults.
Net loss for the six months ended June 30, 2007 was $1.5 million or $0.06 per share, compared to net earnings of $2.1 million or $0.08 per share in the comparable prior year period. Net loss for the three months ended June 30, 2007 was $1.1 million or $0.04 per share, compared to net earnings of $972,000 or $0.04 per share in the comparable prior year quarter.
Continuing deterioration in the Florida real estate market has adversely affected closings on existing contracts and marketing of remaining available units. If these market conditions continue, they will likely have an unfavorable impact on future sales, the commencement and development of new projects and the results of the real estate development operations.
John H. Sottile, Goldfield's President and Chief Executive Officer commented, "Although we are feeling the effects of the slowdown in the Florida real estate market, I am optimistic in the long run on the potential of Pineapple House for a number of reasons. The development is attractive, of high quality construction and combines enhanced amenities with an excellent location. Additionally, Pineapple House was completed on budget and in a timely manner. Furthermore, our carrying costs associated with the unsold units, including the construction debt related to the project, are well within our financial capability. With the building completed, we will be focusing our attention on marketing these exceptional residences."
Mr. Sottile continued, "Turning to Southeast Power, our electrical construction segment, the first six month's results were adversely affected by unanticipated costs associated with customer initiated delays arising during the course of our projects. These delays have had a disruptive and costly effect on operations. The delayed jobs are expected to re-commence in the fourth quarter of this year."
Goldfield is a leading provider of electrical construction and maintenance services in the energy infrastructure industry in the southeastern United States. The company specializes in installing and maintaining electrical transmission lines for a wide range of electric utilities. Goldfield is also involved in the development of high-end condominium projects on Florida's east coast. For additional information, please visit http://www.goldfieldcorp.com.
Statements in this release are based on current expectations. These statements are forward-looking, and actual results may differ materially. For example, electrical construction projects are generally subject to cancellation and, in the real estate segment, there can be no assurance that settlements of condominiums subject to contracts for sale will occur or that construction will progress as expected. For further details, see the Company's filings with the Securities and Exchange Commission.
For further information, please contact: The Goldfield Corporation Phone: (321) 724-1700 Email: firstname.lastname@example.org THE GOLDFIELD CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) Three Months Ended Six Months Ended June 30, June 30, 2007 2006 2007 2006 Revenue Electrical construction $6,658,079 $11,186,323 $14,012,121 $21,678,328 Real estate development (5,303,303) 1,046,540 (2,848,870) 4,549,487 Total revenue 1,354,776 12,232,863 11,163,251 26,227,815 Costs and expenses Electrical construction 4,946,406 8,460,325 11,748,110 16,583,534 Real estate development (3,470,151) 827,489 (1,776,226) 3,148,918 Depreciation 765,770 628,120 1,508,118 1,227,411 Selling, general and administrative 606,362 819,774 1,657,333 1,918,129 Gain on sale of assets (1,436) (11,013) (10,294) (29,323) Total costs and expenses 2,846,951 10,724,695 13,127,041 22,848,669 Total operating income (loss) (1,492,175) 1,508,168 (1,963,790) 3,379,146 Other income (expense), net Interest income 51,554 26,972 112,886 51,684 Interest expense, net (99,060) (62,965) (178,705) (99,957) Other 53,364 110,128 62,513 113,622 Total other income (expenses), net 5,858 74,135 (3,306) 65,349 Income (loss) from operations before income taxes (1,486,317) 1,582,303 (1,967,096) 3,444,495 Income taxes (benefit) (364,815) 609,831 (498,583) 1,327,533 Net income (loss) $(1,121,502) $972,472 $(1,468,513) $2,116,962 Earnings (loss) per share of common stock - basic and diluted $(0.04) $0.04 $(0.06) $0.08 Weighted average number of common shares outstanding - basic and diluted 25,451,354 25,572,192 25,451,354 25,572,192 THE GOLDFIELD CORPORATION AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) June 30, December 31, ASSETS 2007 2006 Current assets Cash and cash equivalents $4,548,191 $6,801,600 Accounts receivable and accrued billings, net 4,147,221 4,908,511 Contracts receivable 3,279,600 10,623,909 Remediation insurance receivable 273,349 329,888 Current portion of notes receivable 50,143 41,453 Construction inventory - 216,989 Real estate inventories 10,506,278 801,411 Costs and estimated earnings in excess of billings on uncompleted contracts 2,473,264 2,358,738 Residential properties under construction - 3,784,165 Prepaid expenses and other current assets 1,715,024 1,022,377 Total current assets 26,993,070 30,889,041 Property, buildings and equipment, at cost, net 10,866,696 9,465,378 Notes receivable, less current portion 375,099 407,409 Deferred charges and other assets 1,699,272 1,142,348 Total assets $39,934,137 $41,904,176 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities Accounts payable and accrued liabilities $2,899,164 $5,359,893 Billings in excess of costs and estimated earnings on uncompleted contracts - 24,444 Notes payable 9,916,477 8,663,768 Capital leases, due within one year 326,754 317,160 Current liabilities of discontinued operations 133,759 208,221 Total current liabilities 13,276,154 14,573,486 Deferred income taxes 465,400 861,400 Other accrued liabilities 24,416 20,821 Notes payable, less current portion 2,560,976 1,207,745 Capital leases, less current portion 729,956 894,976 Total liabilities 17,056,902 17,558,428 Commitments and contingencies Stockholders' equity Common stock 2,781,377 2,781,377 Capital surplus 18,481,683 18,481,683 Retained earnings 2,922,362 4,390,875 Common stock in treasury, at cost (1,308,187) (1,308,187) Total stockholders' equity 22,877,235 24,345,748 Total liabilities and stockholders' equity $39,934,137 $41,904,176
SOURCE The Goldfield Corporation
Released August 14, 2007