Willbros Provides Update for the Fourth Quarter 2011; Total backlog at December 31, 2011 of $2.2B
Willbros Group, Inc. (NYSE: WG) announced today certain preliminary estimated unaudited operating results from continuing operations for the fourth quarter and full year 2011 that the Company expects to report for these periods. Our actual results may differ materially from these estimates due to the completion of our financial closing procedures, final adjustments, including those as a result of the material weakness in our internal controls discussed below, and other developments that may arise between now and the time the financial results for fiscal 2011 are finalized.
Willbros estimates an operating loss in the fourth quarter of $46.0 million, on revenue of $404.9 million. Contributing to the fourth quarter loss was an estimated combined goodwill impairment charge of $36.0 million related to goodwill carried in the Upstream Oil and Gas and Downstream Oil and Gas operating segments in addition to the normal seasonality of the business model.
The Company added that it has been unable to timely file its 2011 Form 10-K, having determined that a material weakness existed in its controls over the completeness, accuracy and presentation of its accounting for income taxes, including the tax provision and related tax assets and liabilities. The Company is working diligently and expects to file its 2011 Form 10-K by April 9, 2012. The Company noted that the delayed filing does not currently put it in default of its multiple credit, surety and lease agreements. Van Welch, Chief Financial Officer, commented, "We have reviewed our significant agreements and believe we can complete the filing within the time periods allotted. The generally non-cash nature of the items which require adjustment, primarily goodwill and tax reserves, does not impact our debt covenants or our liquidity."
For the fourth quarter of 2011, the estimated operating loss was $11.0 million compared to $21.1 million in the fourth quarter of 2010, excluding the impact of non-cash goodwill impairment charges in both years(1) (these are non-GAAP financial measures, and schedules for the GAAP to non-GAAP adjustment reconciliations in this press release are provided in the accompanying schedules). The operating improvement in the fourth quarter was attributed to better performance in the Upstream Oil & Gas segment in the United States and Canada and increased resource utilization in the Utility T&D segment. This improvement was partially offset by lower revenue and income in the Downstream Oil & Gas segment.
Randy Harl, President and Chief Executive Officer, commented, "We delivered improved fourth quarter results relative to last year, largely as a result of the expansion of our Upstream presence and service offerings to help mitigate the seasonality of large diameter pipeline construction and the improvement in our Utility T&D segment, which posted much better results, especially in the Texas market, where we continue to benefit from the CREZ build-out.
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