Argan (AGX) 8-K Argan, Inc. Reports Fourth Quarter and Year End Results

Exhibit 99.1

Argan, Inc. Reports Fourth Quarter and Year End Results

April 10, 2015 – ROCKVILLE, MD – Argan, Inc. (NYSE: AGX) today announced financial results for the three months and fiscal year ended January 31, 2015.

For the year ended January 31, 2015, revenues were $383.1 million compared to $227.5 million for the year ended January 31, 2014. Gemma Power Systems, LLC and affiliates (Gemma) contributed $376.7 million, or 98% of revenues in fiscal 2015, compared to $218.6 million, or 96% of revenues in fiscal 2014.

Argan reported consolidated EBITDA (Earnings before interest, taxes, depreciation and amortization) attributable to the stockholders of Argan, Inc. of $52.2 million for the year ended January 31, 2015 compared to $66.3 million for the prior fiscal year. Gemma reported $58.0 million in EBITDA attributable to the stockholders of Argan, Inc. for fiscal 2015 compared to $69.5 million for fiscal 2014.

Income from operations for fiscal 2015 was $64.1 million compared to income from operations for fiscal 2014 of $65.9 million.

Net income attributable to the stockholders of Argan, Inc. for fiscal 2015 was $30.4 million, or $2.05 per diluted share based on 14,823,000 diluted shares outstanding, compared to $40.1 million, or $2.78 per diluted share based on 14,427,000 diluted shares outstanding for fiscal 2014.

For the three months ended January 31, 2015, consolidated revenues were $102.3 million compared to $59.5 million for the three months ended January 31, 2014. Gemma contributed $100.8 million, or 98% of consolidated revenues for the fourth quarter of fiscal 2015, compared to $58.3 million, or 98% of consolidated revenues for the fourth quarter of fiscal 2014.

Argan reported consolidated EBITDA attributable to the stockholders of Argan, Inc. of $11.9 million for the three months ended January 31, 2015 compared to $15.8 million in the fourth quarter of last fiscal year. Gemma reported $13.7 million in EBITDA attributable to the stockholders of Argan, Inc. for the three months ended January 31, 2015 compared to $17.6 million for the three months ended January 31, 2014.

Income from operations for the three months ended January 31, 2015 was $15.5 million, compared to income from operations of $16.4 million for the fourth quarter of fiscal 2014.

For the three months ended January 31, 2015, Argan reported net income attributable to Argan, Inc. stockholders of $6.0 million, or $0.40 per diluted share based on 14,838,000 diluted shares outstanding, compared to net income of $9.2 million, or $0.63 per diluted share based on 14,581,000 diluted shares outstanding for the fourth quarter of fiscal 2014.

Argan had consolidated cash and cash equivalents of $333.7 million as of January 31, 2015. During the current fiscal year, Argan used cash of $10.2 million to pay a $0.70 dividend per share of common stock. Consolidated working capital increased during the current fiscal year to approximately $148.9 million as of January 31, 2015 from approximately $133.3 million as of January 31, 2014. Consolidated tangible net worth attributable to the stockholders of Argan, Inc. increased to $165.2 million at January 31, 2015 from $135.7 million at January 31, 2014.

Gemma’s backlog as of January 31, 2015 was $423 million compared to $790 million as of January 31, 2014. The decrease in backlog reflects the current year progress on the construction of the Panda Liberty and Panda Patriot power plants.

Commenting on Argan’s financial results, Rainer Bosselmann, Chairman and Chief Executive Officer stated, “Gemma’s continued execution in fiscal 2015 on the Panda Liberty and Panda Patriot projects contributed to record earnings during fiscal 2015. We appreciate the dedicated efforts of our Gemma associates.”

About Argan, Inc.

Argan’s primary business is designing and building energy plants through its Gemma Power Systems subsidiary. These energy plants include single and combined cycle natural gas-fired power plants as well as alternative energy facilities including biodiesel, ethanol, and those powered by renewable energy sources such as wind and solar. Argan also owns Southern Maryland Cable, Inc.

Certain matters discussed in this press release may constitute forward-looking statements within the meaning of the federal securities laws and are subject to risks and uncertainties including, but not limited to: (1) the Company’s ability to achieve its business strategy while effectively managing costs and expenses; (2) the Company’s ability to successfully and profitably integrate acquisitions; and (3) the continued strong performance of our power industry services business. Actual results and the timing of certain events could differ materially from those projected in or contemplated by the forward-looking statements due to a number of factors detailed from time to time in Argan’s filings with the Securities and Exchange Commission. In addition, reference is hereby made to cautionary statements with respect to risk factors set forth in the Company’s most recent reports on Form 10-K and 10-Q, and other SEC filings.

Company Contact:	Investor Relations Contact:
Rainer Bosselmann	Cynthia Flanders
301.315.0027	301.315.0027

ARGAN, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

	Three Months Ended January 31,				Years Ended January 31,
	2015		2014		2015		2014
	(Unaudited)
REVENUES
Power industry services	$	100,774,000	$	58,257,000	$	376,676,000	$	218,649,000
Telecommunications infrastructure services		1,551,000		1,234,000		6,434,000		8,806,000
Revenues		102,325,000		59,491,000		383,110,000		227,455,000
COST OF REVENUES
Power industry services		79,469,000		37,745,000		294,643,000		141,807,000
Telecommunications infrastructure services		1,181,000		1,059,000		4,864,000		6,800,000
Cost of revenues		80,650,000		38,804,000		299,507,000		148,607,000
GROSS PROFIT		21,675,000		20,687,000		83,603,000		78,848,000
Selling, general and administrative expenses		6,137,000		4,329,000		19,470,000		12,918,000
INCOME FROM OPERATIONS		15,538,000		16,358,000		64,133,000		65,930,000
Gains on the deconsolidation of variable interest entities		—		—		—		2,444,000
Other income, net		72,000		134,000		234,000		961,000
INCOME BEFORE INCOME TAXES		15,610,000		16,492,000		64,367,000		69,335,000
Income tax expense		5,734,000		6,460,000		20,912,000		25,991,000
NET INCOME		9,876,000		10,032,000		43,455,000		43,344,000
NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTERESTS		3,878,000		868,000		13,010,000		3,219,000
NET INCOME ATTRIBUTABLE TO THE STOCKHOLDERS OF ARGAN, INC.	$	5,998,000	$	9,164,000	$	30,445,000	$	40,125,000
EARNINGS PER SHARE ATTRIBUTABLE TO THE STOCKHOLDERS OF ARGAN, INC.
Basic	$	0.41	$	0.64	$	2.11	$	2.85
Diluted	$	0.40	$	0.63	$	2.05	$	2.78
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING
Basic		14,561,000		14,219,000		14,433,000		14,072,000
Diluted		14,838,000		14,581,000		14,823,000		14,427,000
CASH DIVIDENDS PER COMMON SHARE	$	—	$	—	$	0.70	$	0.75

ARGAN, INC. AND SUBSIDIARIES

RECONCILIATIONS TO EBITDA (Unaudited)

Consolidated

	Three Months Ended January 31,
	2015			2014
Net income	$	9,876,000		$	10,032,000
Less net income - noncontrolling interests		(3,878,000	)		(868,000	)
Interest expense		30,000			—
Income tax expense		5,699,000			6,460,000
Depreciation		129,000			141,000
Amortization of purchased intangible assets		61,000			61,000
EBITDA attributable to the stockholders of Argan, Inc.	$	11,917,000		$	15,826,000

Power Industry Services

	Three Months Ended January 31,
	2015			2014
Income before income taxes	$	17,486,000		$	18,324,000
Less income before income taxes - noncontrolling interests		(3,913,000	)		(868,000	)
Interest expense		30,000			—
Depreciation		85,000			97,000
Amortization of purchased intangible assets		61,000			61,000
EBITDA attributable to the stockholders of Argan, Inc.	$	13,749,000		$	17,614,000

Consolidated

	Years Ended January 31,
	2015			2014
Net income	$	43,455,000		$	43,344,000
Less net income - noncontrolling interests		(13,010,000	)		(3,219,000	)
Interest expense		30,000			(161,000	)
Income tax expense		20,956,000			25,559,000
Depreciation		551,000			549,000
Amortization of purchased intangible assets		243,000			243,000
EBITDA attributable to the stockholders of Argan, Inc.	$	52,225,000		$	66,315,000

Power Industry Services

	Years Ended January 31,
	2015			2014
Income before income taxes	$	70,334,000		$	72,669,000
Less income before income taxes - noncontrolling interests		(12,966,000	)		(3,651,000	)
Interest expense		30,000			(161,000	)
Depreciation		372,000			366,000
Amortization of purchased intangible assets		243,000			243,000
EBITDA attributable to the stockholders of Argan, Inc.	$	58,013,000		$	69,466,000

Management uses EBITDA, a non-GAAP financial measure, for planning purposes, including the preparation of operating budgets and to determine appropriate levels of operating and capital investments. Management believes that EBITDA provides additional insight for analysts and investors in evaluating the Company’s financial and operational performance and in assisting investors in comparing the Company’s financial performance to those of other companies in the Company’s industry. However, EBITDA is not intended to be an alternative to financial measures prepared in accordance with GAAP and should not be considered in isolation from our GAAP results of operations. Pursuant to the requirements of SEC Regulation G, a reconciliation between the Company’s GAAP and non-GAAP financial results is provided above and investors are advised to carefully review and consider this information as well as the GAAP financial results that are presented in the Company’s SEC filings.

ARGAN, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

JANUARY 31,

	2015			2014
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	333,691,000		$	272,209,000
Accounts receivable, net of allowance for doubtful accounts		27,330,000			23,687,000
Costs and estimated earnings in excess of billings		455,000			527,000
Prepaid expenses		1,092,000			1,754,000
Notes receivable and accrued interest		1,786,000			204,000
Deferred income tax assets		—			178,000
TOTAL CURRENT ASSETS		364,354,000			298,559,000
Property, plant and equipment, net of accumulated depreciation (including $2,658,000 in costs related to a variable interest entity as of January 31, 2015)		6,518,000			4,183,000
Goodwill		18,476,000			18,476,000
Intangible assets, net of accumulated amortization		1,845,000			2,088,000
TOTAL ASSETS	$	391,193,000		$	323,306,000
LIABILITIES AND STOCKHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable	$	37,691,000		$	22,589,000
Accrued expenses		15,976,000			7,912,000
Billings in excess of costs and estimated earnings		161,564,000			134,736,000
Deferred income tax liabilities		201,000			—
TOTAL CURRENT LIABILITIES		215,432,000			165,237,000
Deferred income tax liabilities		809,000			292,000
TOTAL LIABILITIES		216,241,000			165,529,000
COMMITMENTS AND CONTINGENCIES
STOCKHOLDERS’ EQUITY
Preferred stock, par value $0.10 per share – 500,000 shares authorized; no shares issued and outstanding		—			—
Common stock, par value $0.15 per share – 30,000,000 shares authorized; 14,634,434 and 14,289,134 shares issued at January 31, 2015 and 2014, respectively; 14,631,201 and 14,285,901 shares outstanding at January 31, 2015 and 2014, respectively		2,195,000			2,143,000
Additional paid-in capital		109,696,000			100,863,000
Retained earnings		73,614,000			53,335,000
Treasury stock, at cost – 3,233 shares at January 31, 2015 and 2014		(33,000	)		(33,000	)
TOTAL STOCKHOLDERS’ EQUITY		185,472,000			156,308,000
Noncontrolling interests		(10,520,000	)		1,469,000
TOTAL EQUITY		174,952,000			157,777,000
TOTAL LIABILITIES AND EQUITY	$	391,193,000		$	323,306,000