GLDD Reports Increased Third Quarter Earnings
Great Lakes Dredge & Dock Corporation (GLDD) reported third-quarter net income of $13.8 million, up from $12.5 million for the third quarter of 2020. Revenue was $168.6 million for the quarter, and the company’s backlog at the end of the quarter was $598.5 million, it said in the November 2 announcement.
“We ended the third quarter with improved results and a solid backlog,” said Lasse Petterson, president and CEO. “In the first half of 2021, our operations saw substantial negative impacts from the COVID-19 pandemic. Our priority has been and always will be to ensure the safety and health of all our people, and we believe that in this current situation, vaccination is an important tool in achieving this goal. As vaccines became widely available in the second quarter, we set a target to have all parts of our organization vaccinated, and we are now close to reaching this target.
“Although our stringent safety protocols and increasing vaccination efforts were successful, we did experience some lingering COVID-19 related costs in the third quarter,” Petterson said. “The direct COVID-19 costs were $2.1 million in the third quarter, for a total of $9.4 million year to date. Indirect COVID-19 cost impacts are not easily quantified, however we have seen a decrease in our realized project margins, which we attribute in part due to inefficiencies caused by COVID-19. Today our safety protocols and our vaccination efforts have resulted in improved project performance, and we are confident that our continued efforts will ensure reduced COVID-19-related impacts to our operations going forward,”“In addition to the COVID-19 impacts on our third quarter results, we experienced project delays due to Hurricane Ida. Several of our projects were impacted and experienced delays returning to work due to the damage and debris in the ports. One of our vessels, the Terrapin Island, was damaged in the storm and resulted in a six-week unplanned drydock.
“All vessels are back at work in this fourth quarter.”
Petterson acknowledged that even with the company’s backlog and expected improved results in the fourth quarter, the company doesn’t expect to achieve its original expectations for 2021. However, 2021 is still shaping up to be as strong as 2020, he said.
“During the third quarter, Great Lakes was awarded $300.5 million in work resulting in a year-to-date 37.1 percent bid market share, bringing our third-quarter backlog to $598.5 million,” he said. “In addition, we ended the quarter with $533.9 million in low bids and options pending award. Post quarter end, Great Lakes was awarded the Oak Island beach renourishment project for $17.1 million and the South Atlantic Regional Harbor Dredging project for $25.8 million, and we have added an additional $106.9 million to low bids pending award, which includes the Houston Project 11 Deepening that was announced by the Port of Houston.”
Petterson said the offshore wind market provides GLDD with a good growth opportunity.
“The Biden administration’s 30-gigawatt target of offshore wind energy by 2030 confirms our plans to enter this new market by building the first U.S. flagged Jones Act compliant, inclined fall-pipe vessel for subsea rock installation for wind turbine foundations,” he said. “This vessel would represent a significant critical advancement in building the U.S. logistics infrastructure to support the future of the new U.S. offshore wind industry. We anticipate making an investment decision in the fourth quarter of 2021 with expected delivery of the vessel in the second half of 2024.”
