Exhibit 99.1
CB&I Reports Record Results for 2003
THE WOODLANDS, Texas--(BUSINESS WIRE)--Feb. 11, 2004--
Revenues and Net Income Show Continued Growth;
Backlog Increases 21% Year over Year
CB&I (NYSE: CBI) today reported net income increased 32% to $66.0
million or $1.39 per diluted share for the year ended Dec. 31, 2003,
compared with $50.1 million or $1.12 per diluted share for 2002. Net
income for the fourth quarter of 2003 increased 31% to $18.7 million
or $0.39 per diluted share, compared with $14.3 million or $0.31 per
diluted share for the comparable 2002 period.
For the year ended Dec. 31, 2003, new business taken reached a
record $1.7 billion, compared with $1.6 billion in 2002. New business
taken during the fourth quarter of 2003 grew 8% to $400 million,
compared with $370 million in the year-earlier period. New business
during the quarter included storage tank projects in China, the Middle
East, the Caribbean and the Caspian region, and process-related work
in the United States. Backlog at Dec. 31, 2003, increased 21% to $1.6
billion, compared with $1.3 billion at the end of 2002.
"We're extremely pleased with CB&I's results in 2003," said Gerald
M. Glenn, CB&I's Chairman, President and CEO. "The record backlog we
had going into 2003 led to significant revenue growth as projects were
put in place in the field, and another year of record sales means
we've entered 2004 in a similar strong position. We are delivering
excellent project execution, keeping our people safe and maintaining a
solid balance sheet."
Revenues in 2003 grew 40% to $1.6 billion, compared with $1.1
billion in 2002. Revenues for the fourth quarter of 2003 increased 43%
to $471.5 million from $328.7 million in the fourth quarter of 2002.
The increase in revenues year over year was attributable to the strong
backlog going into 2003, which produced significant revenue growth as
projects moved into the field construction phase. For the year,
revenues grew 21% in North America, including a higher volume of
process-related work. Revenues increased nearly 150% in the Company's
Europe, Africa, Middle East (EAME) segment, and grew more than 125% in
the Asia Pacific (AP) segment, due primarily to large projects now
under way in China and Australia, but declined 21% in the Central and
South America (CSA) segment as a result of fewer new awards in certain
Latin American markets.
Gross profit in 2003 of $196.6 million represented a $41.0 million
increase over 2002. Fourth quarter 2003 gross profit was $56.0
million, compared with $44.1 million in the comparable 2002 period.
Gross profit as a percentage of revenues for both the fourth quarter
and full-year 2003 fell slightly as a result of the timing and mix of
projects being executed.
Income from operations in 2003 increased 33% to $103.3 million,
compared with $77.7 million in 2002. Fourth quarter 2003 operating
income increased 37% to $30.2 million, compared with $21.9 million in
the year-earlier period. For the year, higher revenues and effective
project execution led to significantly better operating income in the
North America, EAME and AP segments. Operating income declined in the
CSA segment due primarily to lower revenues.
No special charges or exit costs were recorded in 2003. In 2002,
the Company reported exit costs of $1.0 million in the fourth quarter
and $4.0 million for the full year. The Company's overall effective
tax rate was higher in the fourth quarter and full year as a larger
portion of 2003 earnings were generated in the United States.
CB&I ended 2003 with cash and cash equivalents of $112.9 million,
compared with $102.5 million at Dec. 31, 2002. The Company used a
portion of its cash during the fourth quarter to buy out the ownership
of a minority interest which had been acquired in a December 2000
transaction. Capital expenditures for 2003, including $15.6 million
for the completion of the Company's administrative office in The
Woodlands, Texas, were $31.3 million, compared with $23.9 million in
2002. CB&I had cash in excess of debt of $36.0 million at Dec. 31,
2003.
"CB&I's management team and employees are making good on our
strategy to achieve sustainable growth in revenues, profitability and
shareholder value," Glenn added. "Our acquisitions have strengthened
our ability to provide a broad range of services in production,
processing, storage and distribution to the key markets we serve.
We've got the right team with the right tools and processes to
consistently and safely deliver superior project execution to our
customers anywhere in the world. We're optimistic about our prospects
for 2004, as demand continues to grow in our major end markets. We
continue to actively seek additional acquisitions that will enable us
to expand our capacity and deliver more comprehensive solutions to our
customers."
The Company is issuing the following guidance for new business
taken, revenues and earnings per share (EPS) for 2004: new business
taken is expected to be in a range of $1.8-$1.9 billion for full-year
2004; revenues are expected to be in a range of $350-$400 million for
the first quarter and $1.7-$1.8 billion for full-year 2004; and EPS is
expected to be in a range of $0.25-$0.28 for the first quarter and
$1.55-$1.60 for full-year 2004.
Any statements made in this release that are not based on
historical fact are forward-looking statements and represent
management's best judgment as to what may occur in the future. The
actual outcome and results are not guaranteed, are subject to risks,
uncertainties and assumptions and may differ materially from what is
expressed. A variety of factors could cause business conditions and
results to differ materially from what is contained in the
forward-looking statements including, but not limited to, the
Company's ability to realize cost savings from its expected execution
performance of contracts; the uncertain timing and the funding of new
contract awards, and project cancellations and operating risks; cost
overruns on fixed priced contracts; changes in the costs of or
delivery schedule for components and materials; increased competition;
fluctuating revenues resulting from a number of factors, including the
cyclic nature of the individual markets in which the Company's
customers operate; lower than expected activity in the hydrocarbon
industry, demand from which is the largest component of the Company's
revenue, or lower than expected growth in the Company's other primary
end markets; the Company's ability to integrate and successfully
operate acquired businesses and the risks associated with those
businesses; and the ultimate outcome or effect of the pending FTC
proceeding on the Company's business, financial condition and results
of operations. Additional factors which could cause actual results to
differ from such forward-looking statements are set forth in the
Company's Prospectus filed on Form 424B3 with the SEC on Jan. 23,
2004. The Company does not undertake to update any forward-looking
statements contained herein, whether as a result of new information,
future events or otherwise.
CB&I is one of the world's leading engineering, procurement and
construction companies, specializing in lump-sum turnkey projects for
customers that produce, process, store and distribute the world's
natural resources. With more than 60 locations and 10,000 employees
throughout the world, CB&I capitalizes on its global expertise and
local knowledge to safely and reliably deliver projects virtually
anywhere. Information about CB&I is available at www.CBIepc.com.
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CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)
Three Months Twelve Months
Ended Dec. 31, Ended Dec. 31,
2003 2002 2003 2002
Revenues $471,536 $328,689 $1,612,277 $1,148,478
Cost of revenues 415,503 284,633 1,415,715 992,927
------- ------- --------- ---------
Gross profit 56,033 44,056 196,562 155,551
% of Revenues 11.9% 13.4% 12.2% 13.5%
Selling and
administrative
expenses 25,371 21,503 93,506 73,155
% of Revenues 5.4% 6.5% 5.8% 6.4%
Intangibles
amortization 611 718 2,548 2,529
Other operating
income, net (103) (1,067) (2,833) (1,818)
Exit costs - 971 - 3,972
------- ------- --------- ---------
Income from
operations 30,154 21,931 103,341 77,713
% of Revenues 6.4% 6.7% 6.4% 6.8%
Interest expense (1,686) (1,658) (6,579) (7,114)
Interest income 239 551 1,300 1,595
------- ------- --------- ---------
Income before
taxes and
minority interest 28,707 20,824 98,062 72,194
Income tax expense (8,740) (5,849) (29,713) (20,233)
------- ------- --------- ---------
Income before
minority interest 19,967 14,975 68,349 51,961
Minority interest in
income (1,269) (652) (2,395) (1,812)
------- ------- --------- ---------
Net income $ 18,698 $ 14,323 $ 65,954 $ 50,149
======= ======= ========= =========
Net income per share
Basic $ 0.40 $ 0.32 $ 1.46 $ 1.16
Diluted $ 0.39 $ 0.31 $ 1.39 $ 1.12
Weighted average shares
outstanding
Basic 46,247 44,314 45,315 43,177
Diluted 48,441 45,812 47,527 44,737
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CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES
SEGMENT INFORMATION
(in thousands)
Three Months Ended
Dec. 31, Dec. 31,
2003 2002
NEW BUSINESS TAKEN(1) % of % of
Total Total
North America $246,269 62% $208,544 56%
Europe/Africa/Middle East 104,863 26% 116,520 32%
Asia Pacific 32,258 8% 27,545 7%
Central & South America 16,756 4% 17,461 5%
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Total $400,146 $370,070
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REVENUES % of % of
Total Total
North America $271,433 58% $211,173 64%
Europe/Africa/Middle East 100,535 21% 43,606 13%
Asia Pacific 68,621 14% 40,362 13%
Central & South America 30,947 7% 33,548 10%
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Total $471,536 $328,689
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INCOME/(LOSS) FROM OPERATIONS % of % of
Excluding Exit Costs Revenues Revenues
North America $ 16,857 6.2% $ 14,722 7.0%
Europe/Africa/Middle East 8,790 8.7% 1,343 3.1%
Asia Pacific (302) (0.4%) 1,675 4.1%
Central & South America 4,809 15.5% 5,162 15.4%
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Total $ 30,154 6.4% $ 22,902 7.0%
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EXIT COSTS $ - $ 971
======= =======
INCOME/(LOSS) FROM OPERATIONS
North America $ 16,857 $ 14,081
Europe/Africa/Middle East 8,790 1,221
Asia Pacific (302) 1,556
Central & South America 4,809 5,073
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Total $ 30,154 $ 21,931
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Twelve Months Ended
Dec. 31, Dec. 31,
2003 2002
NEW BUSINESS TAKEN(1) % of % of
Total Total
North America $1,105,369 65% $1,014,375 62%
Europe/Africa/Middle East 380,493 22% 375,897 23%
Asia Pacific 147,238 9% 139,907 8%
Central & South America 75,110 4% 110,949 7%
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Total $1,708,210 $1,641,128
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REVENUES % of % of
Total Total
North America $ 970,851 60% $ 801,624 70%
Europe/Africa/Middle East 329,947 20% 132,853 12%
Asia Pacific 218,201 14% 95,935 8%
Central & South America 93,278 6% 118,066 10%
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Total $1,612,277 $1,148,478
========= =========
INCOME/(LOSS) FROM OPERATIONS % of % of
Excluding Exit Costs Revenues Revenues
North America $ 67,762 7.0% $ 52,100 6.5%
Europe/Africa/Middle East 17,384 5.3% 3,603 2.7%
Asia Pacific 6,000 2.7% 2,270 2.4%
Central & South America 12,195 13.1% 23,712 20.1%
------- -------
Total $103,341 6.4% $ 81,685 7.1%
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EXIT COSTS $ - $ 3,972
======= =======
INCOME/(LOSS) FROM OPERATIONS
North America $ 67,762 $ 49,413
Europe/Africa/Middle East 17,384 3,032
Asia Pacific 6,000 1,950
Central & South America 12,195 23,318
------- -------
Total $103,341 $ 77,713
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(1) New business taken represents the value of new project
commitments received by the Company during a given period. Such
commitments are included in backlog until work is performed and
revenue recognized or until cancellation. Backlog may also
fluctuate with currency movements.
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CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
Dec. 31, Dec. 31,
2003 2002
ASSETS
Current assets $502,272 $382,423
Property and equipment, net 124,505 109,271
Goodwill and other intangibles, net 253,213 191,459
Other non-current assets 42,572 57,283
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Total assets $922,562 $740,436
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LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities $370,893 $287,070
Long-term debt 75,000 75,000
Other non-current liabilities 87,505 96,219
Shareholders' equity 389,164 282,147
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Total liabilities
and shareholders' equity $922,562 $740,436
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CHICAGO BRIDGE & IRON COMPANY N.V. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
AND OTHER FINANCIAL DATA
(in thousands)
Twelve Months
Ended Dec. 31,
2003 2002
CASH FLOWS
Cash flows from operating activities $ 90,366 $ 72,030
Cash flows from investing activities (102,030) (36,957)
Cash flows from financing activities 22,046 16,985
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Increase in cash and cash
equivalents 10,382 52,058
Cash and cash equivalents,
beginning of the year 102,536 50,478
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Cash and cash equivalents,
end of the year $112,918 $102,536
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OTHER FINANCIAL DATA
Depreciation and amortization expense $ 21,431 $ 19,661
Capital expenditures 31,286 23,927
(Decrease)/increase in receivables, net 21,746 (26,874)
(Increase)/decrease in contracts in
progress, net (96,478) 18,389
Increase in accounts payable 49,048 10,690
------- -------
Change in contract capital $(25,684) $ 2,205
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CONTACT: CB&I, The Woodlands
Media:
Bruce Steimle, 832-513-1111
or
Analysts:
Marty Spake, 832-513-1245