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What: Shares of Great Lakes Dredge & Dock Corporation (NASDAQ:GLDD) were drying up today, falling as much as 14% and finishing down 10% after a disappointing earnings report.
So what: The nation's largest provider of dredging service posted a loss in the quarter of $0.05, worse than the penny-per-share shortfall that analysts expected. Sales, meanwhile, fell 3.2% to $174.4 million from a strong first quarter in 2013, but that was much worse than the consensus at $194.13 million. CEO Jon Berger noted a negative impact from severe weather in the first two months of the quarter, which affected equipment downtimes and delayed projects, causing a drop in revenue and gross margin.
Now what: Still, Berger said operations improved in March and activity has picked up in the Middle East, where the company was idle for much of the first quarter with a project begun in Saudi Arabia. Looking ahead, backlog remains strong at $670 million, and the company is particularly optimistic about coastal projection work as a result of Superstorm Sandy and growth in its smaller environment and remediaton segment. Berger also noted that work delays in the first quarter will simply result in the collection of revenue later in the year, so the effects of the poor winter weather seem inconsequential over the long run. Given that, I'd tend to overlook the poor performance this quarter, as the company's overall business appears to be on track.