Hill International, Inc.
Nov 3, 2011
PDF
Add to Briefcase

Hill International Reports Third Quarter and First Nine Months 2011 Financial Results

MARLTON, N.J., Nov. 3, 2011 (GLOBE NEWSWIRE) -- Hill International (NYSE:HIL), the global leader in managing construction risk, announced today financial results for the third quarter and nine months ended September 30, 2011 (see attached tables). Total revenue for the third quarter of 2011 was a record $128.9 million, an increase of 16.1% from the third quarter of 2010. Consulting fee revenue for the third quarter of 2011 was $102.5 million, an increase of 5.2% from the third quarter of 2010.

Operating profit for the third quarter of 2011 was $1.9 million, a decrease of 70.2% from the prior year's quarter. Net earnings in the third quarter was $0.7 million or $0.02 per diluted share based on 38.9 million diluted shares outstanding, as compared to net earnings of $5.1 million or $0.13 per diluted share based on 39.1 million diluted shares outstanding in the third quarter of 2010.

The company's total backlog at September 30, 2011 increased to a record $2.307 billion, up from $2.297 billion at June 30, 2011. Twelve-month backlog at September 30, 2011 was also a record at $475 million, up from $445 million at June 30, 2011.

"We returned to profitability in the third quarter with an aggressive focus on minimizing our overhead costs," said Irvin E. Richter, Hill's Chairman and Chief Executive Officer. "We are also on track to accomplish our goal of exceeding half a billion dollars in total revenue for the year," Richter added.

First Nine Months 2011 Results      

Total revenue for the first nine months of 2011 rose to $378.8 million, an increase of 17.0% from the first nine months of 2010. Consulting fee revenue for the first nine months of 2011 was $299.7 million, an increase of 6.7% from the first nine months of 2010.

Operating loss for the first nine months of 2011 was ($2.6 million) as compared to operating income of $13.3 million in the first nine months of 2010. Net loss for the first nine months of 2011 was ($5.4 million) or ($0.14) per diluted share based on 38.9 million diluted shares outstanding, as compared to net earnings of $10.4 million, or $0.26 per diluted share based on 40.1 million diluted shares outstanding in the first nine months of 2010.

Business Segment Results

In addition to providing consolidated financial results, Hill also reports separate financial results for its two operating segments: the Project Management Group and the Construction Claims Group.

Project Management Group. Hill's Project Management Group provides program management, project management, construction management, project management oversight, troubled project turnaround, staff augmentation, estimating and cost management, project labor agreement consulting and management consulting services.

Total revenue at Hill's Projects Group during the third quarter of 2011 was $98.0 million, an increase of 14.7% from the third quarter of 2010. Consulting fee revenue for the third quarter of 2011 at the Projects Group was $73.1 million, an increase of 0.3% from the third quarter of 2010. Operating profit for the Projects Group for the third quarter of 2011 was $5.1 million, a decrease of 52.6% from the prior year's quarter.

Total revenue at the Projects Group during the first nine months of 2011 grew to $293.5 million, up 17.0% from the first nine months of 2010. Consulting fee revenue for the Projects Group during the first nine months of 2011 was $217.1 million, an increase of 3.2% from the first nine months of 2010. Operating profit for the Projects Group for the first nine months of 2011 was $11.9 million, a decrease of 52.2% from the first nine months of 2010.

Construction Claims GroupHill's Construction Claims Group provides claims preparation, analysis and review, litigation support, lender advisory, cost/damages assessment, delay/disruption analysis, contract review and assessment, risk assessment, adjudication and expert witness testimony services.

Total revenue at Hill's Claims Group during the third quarter of 2011 was $30.9 million, an increase of 20.8% over the third quarter of 2010. Consulting fee revenue for the third quarter of 2011 at the Claims Group rose to $29.4 million, an increase of 19.8% from prior year's quarter. Operating profit for the Claims Group for the third quarter of 2011 was $4.4 million, an increase of 80.4% from the prior year's quarter.

Total revenue at the Claims Group during the first nine months of 2011 rose to $85.3 million, an increase of 17.0% over the first nine months of 2010. Consulting fee revenue for the first nine months of 2011 rose to $82.5 million, an increase of 17.1% over the first nine months of 2010. Operating profit for the Claims Group for the first nine months of 2011 was $7.3 million, a decrease of 10.5% from the first nine months of 2010.

Conference Call

David L. Richter, Hill's President and Chief Operating Officer, and John Fanelli III, Hill's Senior Vice President and Chief Financial Officer, will host a conference call on Friday, November 4, 2011, at 11:00 am Eastern Time to discuss the financial results for the quarter ended September 30, 2011.  Interested parties may participate in the call by dialing (877) 423-9820 (Domestic) or (201) 493-6749 (International) approximately 10 minutes before the call is scheduled to begin and ask to be connected to the Hill International conference call. The conference call will also be broadcast live over the Internet. To listen to the live call, please go to the "Investor Relations" section of Hill's website at www.hillintl.com, and click on "Financial Information," and then "Conferences and Calls". Please go to the website at least 15 minutes early to register, download and install any necessary audio software. If you are unable to participate in the live call, the conference call will be archived and can be accessed for approximately 90 days.

About Hill International

Hill International, with 3,100 employees in 100 offices worldwide, provides program management, project management, construction management, and construction claims and consulting services. Engineering News-Record magazine recently ranked Hill as the 8th largest construction management firm in the United States. For more information on Hill, please visit our website at www.hillintl.com.

The Hill International, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=5733

Forward-Looking Statements

Certain statements contained in this press release may be considered "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, and it is our intent that any such statements be protected by the safe harbor created thereby. Except for historical information contained in this press release, the matters set forth herein including, but not limited to, any projections of revenues, earnings or other financial items; any statements concerning our plans, strategies and objectives for future operations; and any statements regarding future economic conditions or performance, are forward-looking statements. These forward-looking statements are based on our current expectations, estimates and assumptions and are subject to certain risks and uncertainties. Although we believe that the expectations, estimates and assumptions reflected in our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in any of our forward-looking statements. Important factors that could cause our actual results, performance and achievements, or industry results to differ materially from estimates or projections contained in our forward-looking statements include: modifications and termination of client contracts; control and operational issues pertaining to business activities that we conduct on our own behalf or pursuant to joint ventures with other parties; difficulties we may incur in implementing our acquisition strategy; the need to retain and recruit key technical and management personnel; and unexpected adjustments and cancellations related to our backlog. Additional factors that could cause actual results to differ materially from our forward-looking statements are set forth in the reports we have filed with the Securities and Exchange Commission. We do not intend, and undertake no obligation, to update any forward-looking statement.

(HIL-G)

HILL INTERNATIONAL, INC. AND SUBSIDIARIES
EARNINGS RELEASE TABLES
(In 000's, Except Per Share Data)
(Unaudited)
         
Consolidated Statement of Operations        
         
  Three months ended September 30, Nine months ended September 30,
  2011  2010  2011  2010 
         
Consulting fee revenue  $ 102,463   $ 97,401   $ 299,686   $ 280,896 
Reimbursable expenses  26,415   13,623   79,137   42,792 
Total revenue  128,878   111,024   378,823   323,688 
         
Cost of services  58,795   53,676   173,582   159,518 
Reimbursable expenses  26,415   13,623   79,137   42,792 
Total direct expenses  85,210   67,299   252,719   202,310 
         
Gross profit  43,668   43,725   126,104   121,378 
         
Selling, general and administrative expenses  41,810   37,773   128,875   109,537 
Equity in earnings of affiliates (27) (369) (187) (1434)
         
Operating profit (loss)  1,885   6,321  (2,584)  13,275 
         
Interest expense, net  1,922   1,003   4,380   2,202 
         
(Loss) earnings before income taxes (37)  5,318  (6,964)  11,073 
Income tax benefit  (422)  --  (1,776) (40)
         
Consolidated net earnings (loss)  385   5,318  (5,188)  11,113 
Less: net (loss) earnings - noncontrolling interests (269) 218  251  672 
         
Net earnings (loss) attributable to Hill International, Inc. $ 654  $ 5,100  $ (5,439) $ 10,441 
         
Basic earnings (loss) per common share - Hill International, Inc. $ 0.02  $ 0.13  $ (0.14) $ 0.26 
Basic weighted average common shares outstanding  38,497   38,673   38,385   39,602 
         
Diluted earnings (loss) per common share - Hill International, Inc. $ 0.02  $ 0.13  $ (0.14) $ 0.26 
Diluted weighted average common shares outstanding  38,946   39,123   38,385   40,149 
         
Selected Segment Data        
         
  Three months ended September 30, Nine months ended September 30,
  2011  2010  2011  2010 
         
Project Management        
Consulting fee revenue $ 73,061  $ 72,859  $ 217,148  $ 210,423 
Total revenue $ 98,013  $ 85,483  $ 293,504  $ 250,795 
Gross profit $ 27,655  $ 30,276  $ 81,724  $ 81,945 
Gross profit as a percent of consulting fee revenue 37.9 %  41.6 %  37.6 %  38.9 % 
Selling, general and administrative expenses $ 22,582  $ 19,890  $ 70,032  $ 58,514 
SG&A expenses as a percentage of consulting fee revenue 30.9 %  27.3 %  32.3 %  27.8 % 
Operating profit before equity in earnings of affiliates $ 5,073  $ 10,386  $ 11,692  $ 23,431 
Equity in earnings of affiliates $ 27  $ 369  $ 187  $ 1,434 
Operating profit  $ 5,100  $ 10,755  $ 11,879  $ 24,865 
Operating profit as a percent of consulting fee revenue 7.0 %  14.8 %  5.5 %  11.8 % 
         
         
Construction Claims        
Consulting fee revenue $ 29,402  $ 24,542  $ 82,538  $ 70,473 
Total revenue $ 30,865  $ 25,541  $ 85,319  $ 72,893 
Gross profit $ 16,013  $ 13,449  $ 44,380  $ 39,433 
Gross profit as a percent of consulting fee revenue 54.5 %  54.8 %  53.8 %  56.0 % 
Selling, general and administrative expenses $ 11,627  $ 11,018  $ 37,060  $ 31,260 
SG&A expenses as a percentage of consulting fee revenue 39.5 %  44.9 %  44.9 %  44.4 % 
Operating profit  $ 4,386  $ 2,431  $ 7,320  $ 8,175 
Operating profit as a percent of consulting fee revenue 14.9 %  9.9 %  8.9 %  11.6 % 
         
Selected Other Financial Data        
  Three months ended September 30, Nine months ended September 30,
  2011  2010  2011  2010 
         
Consulting fee revenue $ 102,463  $ 97,401  $ 299,686  $ 280,896 
Total revenue $ 128,878  $ 111,024  $ 378,823  $ 323,688 
Gross profit $ 43,668  $ 43,725  $ 126,104  $ 121,378 
Gross profit as a percentage of consulting fee revenue 42.6 %  44.9 %  42.1 %  43.2 % 
Selling, general and administrative expenses (excluding corporate expenses) $ 34,209  $ 30,908  $ 107,092  $ 89,772 
Selling, general and administrative expenses (excluding corporate expenses) as a percentage of consulting fee revenue 33.4 %  31.7 %  35.7 %  32.0 % 
Corporate expenses $ 7,601  $ 6,865  $ 21,783  $ 19,765 
Corporate expenses as a percentage of consulting fee revenue 7.4 %  7.0 %  7.3 %  7.0 % 
Operating profit (loss) $ 1,885  $ 6,321  $ (2,584) $ 13,275 
Operating profit (loss) as a percent of consulting fee revenue 1.8 %  6.5 %  (0.9) % 4.7 % 
Effective income tax rate 1,140.5 %  -- %  25.5 %  (0.4) %
     
Selected Balance Sheet Data    
     
  September 30, 2011 December 31, 2010
     
Cash and cash equivalents $ 16,575  $ 39,406 
Accounts receivable, net $ 201,424  $ 180,856 
Current assets $ 234,186  $ 237,466 
Total assets $ 410,522  $ 370,851 
Current liabilities $ 191,379  $ 104,465 
Total debt $ 93,550  $ 74,959 
Stockholders' equity:    
Hill International, Inc. share of equity $ 156,058  $ 161,091 
Noncontrolling interests $ 21,185  $ 7,005 
Total equity $ 177,243  $ 168,096 

EBITDA Reconciliation

(Unaudited)

Earnings before interest, taxes, depreciation and amortization ("EBITDA") for the third quarter of 2011 were $6.2 million compared to $8.7 million in the third quarter of 2010. EBITDA is not a measure of financial performance under generally accepted accounting principles ("GAAP"). Management believes EBITDA, in addition to operating profit, net income and other GAAP measures, is a useful indicator of Hill's financial and operating performance and its ability to generate cash flows from operations that are available for taxes and capital expenditures. Investors should recognize that EBITDA might not be comparable to similarly-titled measures of other companies. This measure should be considered in addition to, and not as a substitute for or superior to, any measure of performance prepared in accordance with GAAP. A reconciliation of EBITDA to the most directly comparable GAAP measure in accordance with SEC Regulation S-K follows:

  Three months ended September 30, Nine months ended September 30,
  2011  2010  2011  2010 
         
Net (loss) earnings $ 654  $ 5,100  $ (5,439) $ 10,441 
Interest expense, net 1,922  1,003  4,380  2,202 
Income tax benefit (422) --  (1,776) (40)
Depreciation and amortization 4,080  2,579  11,215  7,121 
EBITDA $ 6,234  $ 8,682  $ 8,380  $ 19,724 
CONTACT: Hill International, Inc.

         John P. Paolin

         Vice President of Marketing and Corporate Communications

         (856) 810-6210

         johnpaolin@hillintl.com



         The Equity Group Inc.

         Devin Sullivan

         Senior Vice President

         (212) 836-9608

         dsullivan@equityny.com

Hill International, Inc. Logo

Source: Hill International, Inc.

News Provided by Acquire Media