Lockerbie & Hole Announces 2009 First Quarter Results



    TSX: LH

    EDMONTON, July 10 /CNW/ - Lockerbie & Hole Inc. (the "Company" or
"Lockerbie") releases results for the three months ended May 31, 2008.

    
                                                      Three months ended
                                                 ----------------------------
    (in thousands, except per share amounts)     May 31, 2008   May 31, 2007
    -------------------------------------------------------------------------
    Contract revenue                             $    112,596   $     74,333
    -------------------------------------------------------------------------
    Adjusted EBITDA(1)                                  8,541          8,500
    -------------------------------------------------------------------------
    Net income                                          5,023          4,877
    -------------------------------------------------------------------------
    Basic earnings per share                             0.18           0.25
    -------------------------------------------------------------------------
    Backlog(1)                                        1,410.7          730.7
    -------------------------------------------------------------------------
    (1) For a definition of Adjusted EBITDA and Backlog as used in this press
        release, see "Advisories - Non - GAAP Measures" at the end of this
        press release.


    Highlights

    -   Contract revenues were higher than the comparable three month period
        due to increased activity from oilsands projects.
    -   Backlog increased $348 million as the Company secured $463 million in
        new contracts and change orders during the quarter.
    

    Overall Performance

    Net income for the Company was $5.0 million ($0.18 per share) for the
three months ended May 31, 2008 compared to $4.9 million ($0.25 per share) for
the three months ended May 31, 2007. Project activity increased on a number of
oilsands projects in the Industrial segment resulting in higher revenue.
    Adjusted EBITDA was $8.5 million for the three months ended May 31, 2008
consistent with the comparative period in fiscal 2007. Adjusted EBITDA
remained relatively consistent quarter over quarter as higher revenues where
offset by reduced Profit Margin on Contracts.
    Although revenue increased, Adjusted EBITDA and net income remained
relatively constant as the comparative figures for May 31, 2007 included a
$1.7 million gain from the negotiated conversion of a contingent project
completion bonus to a fixed dollar fee and a $0.9 million gain on the sale of
a fabrication facility in Vancouver, British Columbia.
    For a definition of Adjusted EBITDA and Profit Margin on Contracts as
used in this press release, see "Advisories - Non-GAAP Measures" at the end of
this press release.

    Outlook

    The outlook for the Company remains positive. In the short-term, the
Company will be focused on executing its Backlog and pursuing a number of
opportunities in the Industrial and Infrastructure operating segments. In the
long-term, oilsands and infrastructure investment in Canada continues to
increase, and the Company is positioned to capitalize on the opportunities
within these markets.

    First Quarter Fiscal 2009 Financial Statements and MD&A

    Lockerbie will file its first quarter fiscal 2009 financial statements
and management's discussion and analysis ("MD&A") for such period on the
System for Electronic Data Retrieval ("SEDAR") at www.sedar.com under the
Company's profile on Thursday, July 10, 2008. Such financial statements and
MD&A will also be available on Lockerbie's website at www.lockerbiehole.com on
July 10, 2008.

    First Quarter Fiscal 2009 Conference Call

    As previously announced, Gordon L. Panas, President and Chief Executive
Officer, and Michael G. Slapman, Chief Financial Officer, will host a
conference call to discuss the first quarter fiscal 2009 results on Friday,
July 11 at 9:00 a.m. MDT (11:00 a.m. EDT). Interested parties are encouraged
to participate by calling (800) 733-7571 or (416) 644-3415 (in Toronto, Ont.)
at least ten minutes before the start of the call in order to participate. For
those unable to phone into the live call, a replay will be available up to 14
days after the event at (416) 640-1917 (in Toronto) or (877) 289-8525,
passcode 21276732 followed by the pound sign, and on Lockerbie's website at
www.lockerbiehole.com.

    About Lockerbie

    Lockerbie was founded in 1898 and is one of the largest mechanical
construction contractors in Canada. Lockerbie is a multi-disciplined
contractor providing mechanical, electrical, instrumentation, pipe
fabrication, module assembly, boiler erection, insulation and civil
construction services primarily to the oilsands, mining, institutional,
municipal and commercial market sectors. Lockerbie is headquartered in
Edmonton, Alberta.

    Advisories

    Non-GAAP Measures

    "Adjusted EBITDA" represents income before interest expense and bank
charges, interest income, income taxes, depreciation, and discontinued
operations. Adjusted EBITDA is not a recognized performance measure under GAAP
and does not have a standardized meaning prescribed by GAAP. The Company
believes that Adjusted EBITDA is a useful complementary measure of pre-tax
profitability commonly used by the financial and investment community for
valuation purposes. The most directly comparable measure to Adjusted EBITDA
calculated in accordance with GAAP is net income. For a reconciliation of the
Company's Adjusted EBITDA to net income, see the Company's MD&A which will be
available on SEDAR and on Lockerbie's website at www.lockerbiehole.com on July
10, 2008.
    "Backlog" means the total value of work that has not yet been completed
that: (a) is assessed by the Company as having a high certainty of being
performed by the Company or its subsidiaries by either the existence of an
executed contract or work order specifying job scope, value and timing; or (b)
has been awarded to the Company or its subsidiaries, as evidenced by an
executed binding or non-binding letter of intent or agreement, describing the
general job scope, value and timing of such work, and with the finalization of
a formal contract respecting such work currently assessed by the Company's
management as being reasonably assured. Backlog is not a recognized
performance measure under GAAP and does not have any standardized meaning
prescribed by GAAP. The Company believes that Backlog is a useful
complementary measure of projected activity in future periods commonly used by
management to evaluate the Company's projected activity in future periods.
There is no direct comparable measure to Backlog in GAAP.
    "Profit Margin on Contracts" is calculated by first subtracting all
contract costs from contract revenue and then dividing the net difference by
contract revenue. Profit Margin on Contracts is not a recognized performance
measure under GAAP and does not have any standardized meaning prescribed by
GAAP. The Company believes that Profit Margin on Contracts is a useful
complementary measure of project profitability commonly used by management to
evaluate the Company's performance. There is no direct comparable measure to
Profit Margin on Contracts in GAAP.

    Forward-Looking Statements

    This press release contains statements concerning Lockerbie's outlook and
expectations for its future performance, oilsands and infrastructure
investment, the construction industry, and Lockerbie's business plan and
objectives and other expectations, plans, goals, objectives, assumptions,
information or statements about future events or conditions that may
constitute forward-looking statements or information under applicable
securities legislation. Such forward-looking statements or information are
based on a number of assumptions which may prove to be incorrect. Assumptions
have been made regarding, among other things, the successful implementation of
Lockerbie's business plan, the availability to Lockerbie of qualified
personnel, the continuation and completion of the projects forming Lockerbie's
Backlog, and general economic, business and market conditions. Although
Lockerbie believes that the expectations reflected in such forward-looking
statements or information are reasonable, undue reliance should not be placed
on forward-looking statements because Lockerbie can give no assurance that
such expectations will prove to be correct. The forward-looking statements are
based on Lockerbie's current expectations, estimates and projections, and are
subject to a number of significant risks and uncertainties that could cause
actual results to differ materially from those anticipated. Such risks and
uncertainties include, among others, Lockerbie's ability to be retained for
existing and new project work by existing and new clients, Lockerbie's ability
to retain and hire qualified personnel required, oil and gas prices, the delay
or cancellation of projects forming Lockerbie's Backlog, general economic,
business and market conditions and other risks as are detailed from time to
time in continuous disclosure filings of Lockerbie. Should one or more of
these risks or uncertainties materialize, or should assumptions underlying the
forward-looking statements prove incorrect, actual results may vary materially
from those described herein as anticipated, believed, estimated or expected.
These forward-looking statements are made as of the date of this press
release, and Lockerbie assumes no obligation to update or revise them to
reflect new events or circumstances, except as required by applicable laws.

    %SEDAR: 00025533E




For further information:

For further information: Gordon L. Panas, President & Chief Executive
Officer, or Michael G. Slapman, Chief Financial Officer at: Telephone: (780)
452-1250, Fax: (780) 452-1284, Website: www.lockerbiehole.com

Organization Profile

LOCKERBIE & HOLE INC.

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