- The Company generated net sales of $45.7 million as compared
to $37.9 million in the third quarter of 2022
- Income before income taxes of $4.9 million versus $2.9
million in the third quarter of 2022
- Backlog of $73.1 million at October 31, 2023
Perma-Pipe International Holdings, Inc. (NASDAQ: PPIH) announced
today financial results for the third quarter ended October 31,
2023.
“Revenues for the third quarter were $45.7 million, an increase
of $7.8 million versus the same quarter last year, and an increase
of 30% over those arising in the previous quarter this year. The
resulting income from operations of $4.9 million exceeded the $2.9
million earned in the same quarter of 2022 and represents over 70%
of the year-to-date earnings” noted President and CEO David
Mansfield.
"Backlog has grown during each quarter this year and now stands
at $73.1 million, which represents approximately half of a year’s
revenues at the current run rate.”
“The results from our recently formed joint venture in Saudi
Arabia has so far exceeded expectations and, with the significant
construction plans in the Kingdom, prospects continue to look
promising. We also concluded the establishment of our new plant in
Eastern Canada and operations began there in September, and
activity continues to increase at our new plant in Abu Dhabi. In
addition, we have had some important changes in our organization,
including Matthew Lewicki joining as our new CFO as Bryan Norwood
prepares for retirement,” concluded Mr. Mansfield.
Third Quarter Fiscal 2023 Results
Net sales were $45.7 million and $37.9 million in the three
months ended October 31, 2023 and 2022, respectively. The increase
of $7.8 million, or 21%, was a result of increased sales volumes in
Saudi Arabia.
Gross profit was $13.2 million, or 29% of net sales, and $11.1
million, or 30% of net sales, in the three months ended October 31,
2023 and 2022, respectively. The increase of $2.1 million was
primarily driven by increased sales volumes in Saudi Arabia.
General and administrative expenses were $5.7 million and $5.3
million in the three months ended October 31, 2023 and 2022,
respectively. The increase of $0.4 million, or 8%, was due to
higher payroll costs in the quarter.
Selling expenses were $1.5 million and $1.3 in the three months
ended October 31, 2023 and 2022, respectively. The increase of $0.2
million was consistent with prior quarter results.
Net interest expense remained consistent and was $0.6 million
and $0.7 million in the three months ended October 31, 2023 and
2022, respectively.
Other expense was $(0.5) million and $(0.9) million for the
three months ended October 31, 2023 and 2022, respectively. The
components of other expense were both related to the pension plan
termination.
The Company's worldwide effective tax rates ("ETR") were 31% and
40% in the three months ended October 31, 2023 and 2022,
respectively. The change in the ETR is due primarily to the
inability to recognize tax benefits due to losses incurred in the
United States resulting in a full valuation allowance and due to
changes in the mix of income and loss in various jurisdictions.
Net income attributable to common stock was $1.9 million and
$1.7 million in the three months ended October 31, 2023 and 2022,
respectively. The increase of $0.2 million was mainly due to
increased sales activity in the quarter.
Perma-Pipe International Holdings, Inc.
Perma-Pipe International Holdings, Inc. (the “Company”) is a
global leader in pre-insulated piping and leak detection systems
for oil and gas gathering, district heating and cooling, and other
applications. It uses its extensive engineering and fabrication
expertise to develop piping solutions that solve complex challenges
regarding the safe and efficient transportation of many types of
liquids. In total, the Company has operations at fourteen locations
in six countries.
Forward-Looking Statements
Certain statements and other information contained in this press
release that can be identified by the use of forward-looking
terminology constitute “forward-looking statements” within the
meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended,
and are subject to the safe harbors created thereby, including,
without limitation, statements regarding the expected future
performance and operations of the Company. These statements should
be considered as subject to the many risks and uncertainties that
exist in the Company's operations and business environment. Such
risks and uncertainties include, but are not limited to, the
following: (i) fluctuations in the price of oil and natural gas and
its impact on customer order volume for the Company's products;
(ii) the Company’s ability to purchase raw materials at favorable
prices and to maintain beneficial relationships with its suppliers;
(iii) decreases in government spending on projects using the
Company’s products, and challenges to the Company’s non-government
customers’ liquidity and access to capital funds; (iv) the
Company’s ability to repay its debt and renew expiring
international credit facilities; (v) the Company’s ability to
effectively execute its strategic plan and achieve sustained
profitability and positive cash flows; (vi) the Company's ability
to collect a long-term account receivable related to a project in
the Middle East; (vii) the Company’s ability to interpret changes
in tax regulations and legislation; (viii) the Company's ability to
use its net operating loss carryforwards; (ix) reversals of
previously recorded revenue and profits resulting from inaccurate
estimates made in connection with the Company’s "over-time" revenue
recognition; (x) the Company’s failure to establish and maintain
effective internal control over financial reporting; (xi) the
timing of order receipt, execution, delivery and acceptance for the
Company’s products; (xii) the Company’s ability to successfully
negotiate progress-billing arrangements for its large contracts;
(xiii) aggressive pricing by existing competitors and the entrance
of new competitors in the markets in which the Company operates;
(xiv) the Company’s ability to manufacture products free of latent
defects and to recover from suppliers who may provide defective
materials to the Company; (xv) reductions or cancellations of
orders included in the Company’s backlog; (xvi) risks and
uncertainties specific to the Company's international business
operations; (xvii) the Company’s ability to attract and retain
senior management and key personnel; (xviii) the Company’s ability
to achieve the expected benefits of its growth initiatives; (xix)
the impact of pandemics and other public health crises on the
Company and its operations; and (xx) the impact of cybersecurity
threats on the Company’s information technology systems.
Shareholders, potential investors and other readers are urged to
consider these factors carefully in evaluating the forward-looking
statements and are cautioned not to place undue reliance on such
forward-looking statements. The forward-looking statements made
herein are made only as of the date of this press release and we
undertake no obligation to publicly update any forward-looking
statements, whether as a result of new information, future events
or otherwise. More detailed information about factors that may
affect our performance may be found in our filings with the
Securities and Exchange Commission, which are available at
https://www.sec.gov and under the Investor Center section of our
website (http://investors.permapipe.com.)
Additional information regarding the Company's financial results
for the three months ended October 31, 2023, including management's
discussion and analysis of the Company's financial condition and
results of operations, is contained in the Company's Quarterly
Report on Form 10-Q for the quarterly period ended October 31,
2023, which will be filed with the Securities and Exchange
Commission on or about the date hereof and will be accessible at
www.sec.gov and www.permapipe.com. For more information, visit the
Company's website.
PERMA-PIPE INTERNATIONAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (In
thousands, except per share data)
Three Months Ended October
31,
Nine Months Ended October
31,
2023
2022
2023
2022
Net sales
$
45,690
$
37,903
$
110,489
$
106,128
Gross profit
13,184
11,130
29,424
28,065
Total operating expenses
7,145
6,594
20,618
20,043
Income from operations
6,039
4,536
8,806
8,022
Interest expense
640
717
1,788
1,585
Other expense
(502
)
(948
)
(350
)
(963
)
Income before income taxes
4,897
2,871
6,668
5,474
Income tax expense
1,533
1,143
3,257
2,763
Net income
$
3,364
$
1,728
$
3,411
$
2,711
Less: Net income attributable to non-controlling interest
1,429
0
1,577
0
Net income attributable to common stock
$
1,935
$
1,728
$
1,834
$
2,711
Earnings per share attributable to common stock Basic
$
0.24
$
0.22
$
0.23
$
0.33
Diluted
$
0.24
$
0.21
$
0.23
$
0.33
PERMA-PIPE INTERNATIONAL HOLDINGS, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS (In thousands except per share
data)
October 31, 2023 January 31, 2023
(Unaudited) ASSETS Current assets
$
94,653
$
85,658
Long-term assets
49,552
37,308
Total assets
$
144,205
$
122,966
LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities
$
57,538
$
43,790
Long-term liabilities
25,538
21,392
Total liabilities
83,076
65,182
Non-controlling interests
4,156
0
Stockholders' equity
56,973
57,784
Total liabilities and equity
$
144,205
$
122,966
View source
version on businesswire.com: https://www.businesswire.com/news/home/20231208031400/en/
Perma-Pipe International Holdings, Inc. David Mansfield,
President and CEO
Perma-Pipe Investor Relations (847) 929-1200
investor@permapipe.com
Perma Pipe (NASDAQ:PPIH)
Historical Stock Chart
From Jun 2024 to Jul 2024
Perma Pipe (NASDAQ:PPIH)
Historical Stock Chart
From Jul 2023 to Jul 2024