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8-K - 8-K - Hill International, Inc.a14-7872_18k.htm

Exhibit 99.1

 

GRAPHIC

 

Hill International, Inc.

 

The Equity Group Inc.

John P. Paolin

 

Devin Sullivan

Senior Vice President of Marketing and

 

Senior Vice President

Corporate Communications

 

(212) 836-9608

(856) 810-6210

 

dsullivan@equityny.com

johnpaolin@hillintl.com

 

 

 

FOR IMMEDIATE RELEASE

 

Hill International Reports Fourth Quarter and Full Year 2013 Financial Results

 

Marlton, NJ — March 10, 2014 — Hill International (NYSE:HIL), the global leader in managing construction risk, announced today financial results for the fourth quarter and full year ended December 31, 2013 (see attached tables).

 

Total revenue for the fourth quarter of 2013 was $145.0 million, an increase of 15.4% from the fourth quarter of 2012.  Consulting fee revenue for the fourth quarter was a record $130.9 million, an increase of 18.2% from the fourth quarter of the prior year.

 

EBITDA (as defined below) for the fourth quarter of 2013 was $9.2 million, up 321.9% from the fourth quarter of 2012.  Operating profit for the fourth quarter was $7.0 million compared to an operating loss of ($0.3 million) in the fourth quarter of the prior year.  Net loss for the fourth quarter of 2013 was ($1.3 million), or ($0.03) per diluted share, compared to a net loss of ($22.5 million) in the fourth quarter of 2012, or ($0.58) per diluted share.

 

The company’s total backlog at December 31, 2013 was a record $1.027 billion, up 8.0% from $951 million at September 30, 2013.  Twelve-month backlog at December 31, 2013 was also a record at $394 million, an increase of 3.1% from $382 million at September 30, 2013.

 

“Despite the small quarterly loss, we finished a strong year with a strong fourth quarter with respect to revenues and EBITDA,” said Irvin E. Richter, Hill’s Chairman and Chief Executive Officer.  “We also ended the year with more than one billion dollars in backlog for the first time in our company’s history, which bodes well for even better performance in 2014,” added Richter.

 

Full Year 2013 Results

 

Total revenue for 2013 was a record $576.7 million, an increase of 19.9% from 2012.  Consulting fee revenue for 2013 was a record $512.1 million, an increase of 22.6% over 2012.

 

EBITDA for 2013 was a record $41.3 million, a 161.3% increase from 2012.  Operating profit for 2013 was a record $32.5 million, a 518.6% increase from the prior year.  Net income for 2013 was $1.6 million, or $0.04 per diluted share, compared to a net loss of ($28.2 million), or ($0.73) per diluted share, during 2012.

 



 

2014 Guidance

 

Based on current market conditions and the backlog amounts described above, the company estimates that consulting fee revenue for 2014 will be between $575 million and $600 million. This guidance, which assumes no acquisitions, reflects approximately 12% to 17% growth in consulting fee revenue for the year.

 

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, project labor agreement consulting, commissioning, estimating and cost management, and labor compliance services.

 

Total revenue at Hill’s Project Management Group during the fourth quarter of 2013 was $111.8 million, an increase of 13.4% from the fourth quarter of 2012.  Consulting fee revenue for the fourth quarter at the Projects Group was $99.0 million, an increase of 16.9% from the prior year’s fourth quarter.  Operating profit for the Projects Group for the fourth quarter of 2013 was $11.7 million, an increase of 152.9% from the fourth quarter of 2012.

 

Total revenue at the Projects Group during the full year 2013 was a record $452.5 million, an increase of 21.6% from 2012.  Consulting fee revenue for the Projects Group during 2013 was a record $392.6 million, an increase of 25.7% from the prior year.  Operating profit for the Projects Group for 2013 was a record $48.7 million, up 109.2% from 2012.

 

Construction Claims GroupHill’s Construction Claims Group provides claims consulting, management consulting, litigation support, expert witness testimony, cost/damages assessment, delay/disruption analysis, adjudication, lender advisory, risk management, forensic accounting, fraud investigation and Project Neutral services.

 

Total revenue at Hill’s Claims Group during the fourth quarter of 2013 was a record $33.1 million, an increase of 22.5% from the fourth quarter of 2012.  Consulting fee revenue for the fourth quarter at the Claims Group was a record $31.9 million, an increase of 22.4% from the prior year’s fourth quarter.  Operating profit for the Claims Group for the fourth quarter of 2013 was $2.5 million, an increase of 47.3% from the fourth quarter of 2012.

 

Total revenue at the Claims Group during the full year 2013 was a record $124.2 million, an increase of 14.4% from 2012.  Consulting fee revenue for the Claims Group for 2013 was a record $119.5 million, an increase of 13.4% from the prior year.  Operating profit for the Claims Group for 2013 was a record $12.2 million, an increase of 50.8% from 2012.

 

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 March 11, 2014, at 11:00 am Eastern Time to discuss the financial results for the fourth quarter and full year ended December 31, 2013.  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 from Hill’s website for approximately 90 days.

 

About Hill International

 

Hill International, with 4,100 employees in 100 offices worldwide, provides program management, project management, construction management, construction claims and other consulting services primarily to the buildings, transportation, environmental, energy and industrial markets.  Engineering News-Record magazine recently ranked Hill as the 9th largest construction management firm in the United States.  For more information on Hill, please visit our website at www.hillintl.com.

 

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

 

Forward-Looking Statements

 

Certain statements contained herein 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, 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 to differ materially from estimates or projections contained in our forward-looking statements are set forth in the Risk Factors section and elsewhere 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-F)

 



 

HILL INTERNATIONAL, INC. AND SUBSIDIARIES

EARNINGS RELEASE TABLES

(In 000’s, Except Per Share Data)

(Unaudited)

 

Consolidated Statement of Operations

 

 

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

 

Consulting fee revenue

 

$

130,921

 

$

110,767

 

$

512,085

 

$

417,598

 

Reimbursable expenses

 

14,029

 

14,886

 

64,596

 

63,183

 

Total revenue

 

144,950

 

125,653

 

576,681

 

480,781

 

Cost of services

 

72,266

 

62,850

 

296,055

 

239,572

 

Reimbursable expenses

 

14,029

 

14,886

 

64,596

 

63,183

 

Total direct expenses

 

86,295

 

77,736

 

360,651

 

302,755

 

Gross profit

 

58,655

 

47,917

 

216,030

 

178,026

 

Selling, general and administrative expenses

 

51,688

 

48,220

 

183,572

 

172,779

 

Operating profit (loss)

 

6,967

 

(303

)

32,458

 

5,247

 

Interest and related financing fees, net

 

5,607

 

5,402

 

22,864

 

18,150

 

Earnings (loss) before income taxes

 

1,360

 

(5,705

)

9,594

 

(12,903

)

Income tax expense

 

2,060

 

16,063

 

6,043

 

13,442

 

Net (loss) earnings

 

(700

)

(21,768

)

3,551

 

(26,345

)

Less: net earnings - noncontrolling interest

 

566

 

693

 

1,922

 

1,872

 

Net (loss) earnings attributable to Hill International, Inc.

 

$

(1,266

)

$

(22,461

)

$

1,629

 

$

(28,217

)

Basic (loss) earnings per common share - Hill International, Inc.

 

$

(0.03

)

$

(0.58

)

$

0.04

 

$

(0.73

)

Basic weighted average common shares outstanding

 

39,538

 

38,657

 

39,098

 

38,500

 

Diluted (loss) earnings per common share - Hill International, Inc.

 

$

(0.03

)

$

(0.58

)

$

0.04

 

$

(0.73

)

Diluted weighted average common shares outstanding

 

39,538

 

38,657

 

39,322

 

38,500

 

 



 

Selected Segment Data

 

 

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

 

Project Management

 

 

 

 

 

 

 

 

 

Consulting fee revenue

 

$

99,042

 

$

84,722

 

$

392,602

 

$

312,232

 

Total revenue

 

$

111,817

 

$

98,611

 

$

452,517

 

$

372,281

 

Gross profit

 

$

40,147

 

$

33,392

 

$

148,599

 

$

119,640

 

Gross profit as a percent of consulting fee revenue

 

40.5

%

39.4

%

37.8

%

38.3

%

Selling, general and administrative expenses

 

$

28,445

 

$

28,765

 

$

99,917

 

$

96,367

 

SG&A expenses as a percentage of consulting fee revenue

 

28.7

%

34.0

%

25.4

%

30.9

%

Operating profit

 

$

11,702

 

$

4,627

 

$

48,682

 

$

23,273

 

Operating profit as a percent of consulting fee revenue

 

11.8

%

5.5

%

12.4

%

7.5

%

 

 

 

 

 

 

 

 

 

 

Construction Claims

 

 

 

 

 

 

 

 

 

Consulting fee revenue

 

$

31,879

 

$

26,045

 

$

119,483

 

$

105,366

 

Total revenue

 

$

33,133

 

$

27,042

 

$

124,164

 

$

108,500

 

Gross profit

 

$

18,508

 

$

14,525

 

$

67,431

 

$

58,386

 

Gross profit as a percent of consulting fee revenue

 

58.1

%

55.8

%

56.4

%

55.4

%

Selling, general and administrative expenses

 

$

15,966

 

$

12,799

 

$

55,260

 

$

50,315

 

SG&A expenses as a percentage of consulting fee revenue

 

50.1

%

49.1

%

46.2

%

47.8

%

Operating profit

 

$

2,542

 

$

1,726

 

$

12,171

 

$

8,071

 

Operating profit as a percent of consulting fee revenue

 

8.0

%

6.6

%

10.2

%

7.7

%

 



 

Selected Other Financial Data

 

 

 

Three Months Ended December 31,

 

Years Ended December 31,

 

 

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

 

Consulting fee revenue

 

$

130,921

 

$

110,767

 

$

512,085

 

$

417,598

 

Total revenue

 

$

144,950

 

$

125,653

 

$

576,681

 

$

480,781

 

Gross profit

 

$

58,655

 

$

47,917

 

$

216,030

 

$

178,026

 

Gross profit as a percentage of consulting fee revenue

 

44.8

%

43.3

%

42.2

%

42.6

%

Selling, general and administrative expenses (excluding corporate expenses)

 

$

44,411

 

$

41,564

 

$

155,177

 

$

146,682

 

Selling, general and administrative expenses (excluding corporate expenses) as a percentage of consulting fee revenue

 

33.9

%

37.5

%

30.3

%

35.1

%

Corporate expenses

 

$

7,277

 

$

6,656

 

$

28,395

 

$

26,097

 

Corporate expenses as a percentage of consulting fee revenue

 

5.6

%

6.0

%

5.5

%

6.2

%

Operating profit (loss)

 

$

6,967

 

(303

)

$

32,458

 

$

5,247

 

Operating profit (loss) as a percent of consulting fee revenue

 

5.3

%

(0.3

)%

6.3

%

1.3

%

Effective income tax rate

 

151.5

%

NM

%

63.0

%

(104.2

)%

 



 

Selected Balance Sheet Data

 

 

 

December 31, 2013

 

December 31, 2012

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

30,381

 

$

16,716

 

Accounts receivable, net

 

232,011

 

211,176

 

Current assets

 

297,893

 

257,270

 

Total assets

 

449,102

 

421,673

 

Current liabilities

 

151,515

 

150,135

 

Total debt

 

133,261

 

109,456

 

 

 

 

 

 

 

Stockholders’ equity:

 

 

 

 

 

Hill International, Inc. share of equity

 

131,144

 

127,546

 

Noncontrolling interests

 

11,887

 

13,557

 

Total equity

 

$

143,031

 

$

141,103

 

 

EBITDA Reconciliation

 

Earnings before interest, taxes, depreciation and amortization (“EBITDA”) for the fourth quarter of 2013 were $9.2 million compared to $2.2 million in the fourth quarter of 2012. 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 December 31,

 

Years Ended December 31,

 

 

 

2013

 

2012

 

2013

 

2012

 

 

 

 

 

 

 

 

 

 

 

Net (loss) earnings

 

$

(1,266

)

$

(22,461

)

$

1,629

 

$

(28,217

)

Interest and related financing fees, net

 

5,607

 

5,402

 

22,864

 

18,150

 

Income tax expense

 

2,060

 

16,063

 

6,043

 

13,442

 

Depreciation and amortization

 

2,835

 

3,185

 

10,756

 

12,430

 

EBITDA

 

$

9,236

 

$

2,189

 

$

41,292

 

$

15,805