Orion (US:ORN)2024-03-01 21:12Financial Performance - In 2023, Orion Group Holdings, Inc. recorded revenues of $711.8 million, a decrease of 4.9% compared to $748.3 million in 2022[186]. - The net loss for 2023 was $17.9 million, compared to a net loss of $12.6 million in the prior year[186]. - Contract revenues for the year ended December 31, 2023 were $711.8 million, a decrease of $36.5 million or 4.9% compared to $748.3 million in 2022[215]. - Gross profit for 2023 was $61.7 million, an increase of 21.5% from $50.7 million in 2022, with a gross margin of 8.7%[201]. - Interest expense for the year ended December 31, 2023 was $11.7 million, an increase of $7.2 million compared to $4.5 million in the prior year, due to an increase in the weighted average interest rate from 6.23% to 12.00%[206]. - Cash flows provided by operating activities for 2023 were $17.2 million, an increase from $9.6 million in 2022[227]. - Working capital increased to $55.9 million as of December 31, 2023, compared to $31.1 million at December 31, 2022[225]. Segment Performance - The marine segment generated $395.9 million in revenue, while the concrete segment contributed $315.9 million[186]. - Marine segment revenues increased by $56.7 million or 16.7% to $395.9 million in 2023, primarily driven by the Pearl Harbor Project[216]. - Concrete segment revenues decreased by $93.2 million or 22.8% to $315.9 million in 2023, mainly due to winding down operations in Central Texas[218]. - The concrete segment began generating profit in Q3 2023, following strategic investments in business development and staff training[188]. Backlog and Bids - The consolidated backlog at the end of 2023 was $762.2 million, down from $877.5 million at the end of Q3 2023[196]. - The company has $3.0 billion of quoted bids outstanding, with over $121 million resulting in contract awards after the fiscal year ended December 31, 2023[196]. Expenses and Costs - Selling, General and Administrative (SG&A) expenses increased to $69.4 million, up 11.1% from $62.5 million in the prior year[202]. - SG&A expenses for the year ended December 31, 2022 were $62.5 million, an increase of $2.3 million or 3.9%, but as a percentage of total contract revenues, it decreased from 10.0% to 8.4%[210]. - The company incurred loan costs of $6.5 million and payments on finance lease liabilities of $4.8 million during the year ended December 31, 2023[233]. Financing and Credit Facilities - The company closed a $103 million asset-based lending credit facility, including a term loan of $38 million and a revolving credit facility of up to $65 million[190]. - The company entered into a new three-year $103.0 million Credit Agreement on May 15, 2023, which includes a $65.0 million asset-based revolving credit line and a $38.0 million fixed asset term loan[237]. - At December 31, 2023, the company had $38.0 million in outstanding borrowings under its Credit Agreement, with a weighted average ending interest rate of 13.46%[260]. - A 100 basis-point increase in SOFR would increase the company's annual interest expense by approximately $0.4 million[260]. - The company had borrowings of $5.0 million from a prior credit agreement, $38.0 million from a new term loan, and $64.0 million from a revolving credit line under the new Credit Agreement during the year ended December 31, 2023[231]. Risk Factors - The company is subject to fluctuations in commodity prices for concrete, steel products, and fuel, which may impact results due to the fixed-price nature of many contracts[259]. - The company believes its balance sheet and working capital position will allow access to additional bonding capacity as needed in the future[238]. - The company is generally able to include anticipated cost increases in the pricing of bids due to the short-term duration of its projects[239]. Insurance Coverage - The company maintains insurance coverage totaling $300 million in excess of primary coverage for its marine and concrete segments[256].