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Matrix swings to loss on year-over-year results for second quarter

Matrix Service Co. builds tanks at the Cushing terminal in Oklahoma. [THE OKLAHOMAN ARCHIVES]
Matrix Service Co. builds tanks at the Cushing terminal in Oklahoma. [THE OKLAHOMAN ARCHIVES]

TULSA — Matrix Service Co.’s second-quarter earnings for fiscal 2020 swung to a loss year-over-year after taking some non-cash charges, it announced this week.

Wall Street expressed displeasure with the announcement, dropping the company's stock price by $7, or 35%, to $12.85 a share on the Nasdaq.

The company reported a second-quarter net loss of about $28 million, or $1.04 per share, on revenues of about $318.7 million.

During the same period a year ago, it reported a net income of about $4 million, or 15 cents per share, on revenues of about $340.6 million.

Were it not for the nearly $39 million in non-cash charges the company took involving the electrical infrastructure and industrial segments of its business, it projected its net income would have been 19 cents per share.

“We have made a series of strategic changes (in the industrial and electrical infrastructure segments),” CEO John R. Hewitt stated as part of the earnings announcement.

“These organizational changes in our iron and steel and power delivery businesses include talent enhancements as well as overhead and capital expenditure reductions.”

Headwinds the company faced in its industrial segment included general economic and trade issues and the deterioration of a relationship between Matrix and a key customer that represented nearly 70% of that segment’s revenue.

In the electrical infrastructure segment, problems were caused by depressed gross margins that accelerated during the quarter, officials said.

Matrix provides a wide range of engineering, procurement, construction and maintenance services through its four subsidiaries to North America’s energy, industrial and electrical power markets.

It builds above-ground storage tanks and terminals for crude oil, liquid natural gas and natural gas liquids, offers design and project management services in building natural gas processing facilities, using both modular and traditional-build techniques, and it provides maintenance, turnaround and construction services at refineries.

Matrix also provides engineering, procurement and construction services in the aerospace, mining and minerals, fertilizer, cement, and grain industries.

Despite the difficulties, Hewitt remained upbeat about the company’s position, noting its work backlog stood at more than $872 million at the end of the quarter, not including a significant project announced last month with Eagle LNG that is expected to keep the company busy the next several years.

Plus, Matrix repurchased a half million shares of its stock during the second quarter for $9.9 million and has about $277 million in liquidity.

“Matrix has continued to strengthen its market position as a leading contractor for terminal and storage work,” Hewitt said.

Related Photos
<strong>Hewitt</strong>

Hewitt

<figure><img src="//cdn2.newsok.biz/cache/r960-aba5d770a3d6c4ff49d994b549516d4b.jpg" alt="Photo - Hewitt " title=" Hewitt "><figcaption> Hewitt </figcaption></figure><figure><img src="//cdn2.newsok.biz/cache/r960-40f749ab77d12afaae12c1a8cf18664e.jpg" alt="Photo - Matrix Service Co. builds tanks at the Cushing terminal in Oklahoma. [THE OKLAHOMAN ARCHIVES] " title=" Matrix Service Co. builds tanks at the Cushing terminal in Oklahoma. [THE OKLAHOMAN ARCHIVES] "><figcaption> Matrix Service Co. builds tanks at the Cushing terminal in Oklahoma. [THE OKLAHOMAN ARCHIVES] </figcaption></figure>
Jack Money

Jack Money has worked for The Oklahoman for more than 20 years. During that time, he has worked for the paper’s city, state, metro and business news desks, including serving for a while as an assistant city editor. Money has won state and regional... Read more ›

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