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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

 

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the quarterly period ended September 30, 2021

OR

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from                  to                 

Commission file number: 001-33225

Great Lakes Dredge & Dock Corporation

(Exact name of registrant as specified in its charter)

 

 

Delaware

 

20-5336063

(State or other jurisdiction of

incorporation or organization)

 

(I.R.S. Employer

Identification No.)

 

 

 

9811 Katy Freeway, Suite 1200, Houston, TX

 

77024

(Address of principal executive offices)

 

(Zip Code)

(346) 359-1010

(Registrant’s telephone number, including area code)

 

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock (Par Value $0.0001)

 

GLDD

 

Nasdaq Stock Market, LLC

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes      No  

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes      No  

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

 

Large accelerated filer

 

 

Accelerated filer

 

Non-accelerated filer

 

 

Smaller reporting company

 

Emerging growth company

 

 

 

 

 

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. 

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  

 

As of October 26, 2021, 65,736,524 shares of the Registrant’s Common Stock, par value $.0001 per share, were outstanding.

 

 

 

 


 

 

Great Lakes Dredge & Dock Corporation and Subsidiaries

Quarterly Report Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

For the Quarterly Period ended September 30, 2021

INDEX

 

 

 

 

 

Page

 

 

 

 

 

 

 

Part I Financial Information (Unaudited)

 

3

 

 

 

 

 

Item 1

 

Financial Statements

 

3

 

 

 

 

 

 

 

Condensed Consolidated Balance Sheets at September 30, 2021 and December 31, 2020

 

3

 

 

 

 

 

 

 

Condensed Consolidated Statements of Operations for the Three and Nine Months ended September 30, 2021 and 2020

 

4

 

 

 

 

 

 

 

Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months ended September 30, 2021 and 2020

 

5

 

 

 

 

 

 

 

Condensed Consolidated Statements of Equity for the Three and Nine Months ended September 30, 2021 and 2020

 

6

 

 

 

 

 

 

 

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2021 and 2020

 

7

 

 

 

 

 

 

 

Notes to Condensed Consolidated Financial Statements

 

8

 

 

 

 

 

Item 2

 

Management’s Discussion and Analysis of Financial Condition and Results of Operations

 

15

 

 

 

 

 

Item 3

 

Quantitative and Qualitative Disclosures About Market Risk

 

23

 

 

 

 

 

Item 4

 

Controls and Procedures

 

23

 

 

 

 

 

 

 

Part II Other Information

 

24

 

 

 

 

 

Item 1

 

Legal Proceedings

 

24

 

 

 

 

 

Item 1A

 

Risk Factors

 

24

 

 

 

 

 

Item 2

 

Unregistered Sales of Equity Securities and Use of Proceeds

 

24

 

 

 

 

 

Item 3

 

Defaults Upon Senior Securities

 

25

 

 

 

 

 

Item 4

 

Mine Safety Disclosures

 

25

 

 

 

 

 

Item 5

 

Other Information

 

25

 

 

 

 

 

Item 6

 

Exhibits

 

26

 

 

 

 

 

 

 

Signature

 

27

 

 

 

 

 

 

 

 

2


 

 

PART I — Financial Information

Item 1.

Financial Statements.

GREAT LAKES DREDGE & DOCK CORPORATION AND SUBSIDIARIES

Condensed Consolidated Balance Sheets

(Unaudited)

(in thousands, except per share amounts)

 

 

September 30,

 

 

December 31,

 

 

 

2021

 

 

2020

 

ASSETS

 

 

 

 

 

 

 

 

CURRENT ASSETS:

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

$

173,838

 

 

$

216,510

 

Accounts receivable—net

 

 

43,687

 

 

 

38,990

 

Contract revenues in excess of billings

 

 

33,344

 

 

 

32,106

 

Inventories

 

 

30,427

 

 

 

34,689

 

Prepaid expenses and other current assets

 

 

33,121

 

 

 

40,398

 

Total current assets

 

 

314,417

 

 

 

362,693

 

 

 

 

 

 

 

 

 

 

PROPERTY AND EQUIPMENT—Net

 

 

431,856

 

 

 

383,042

 

OPERATING LEASE ASSETS

 

 

52,100

 

 

 

65,188

 

GOODWILL

 

 

76,576

 

 

 

76,576

 

INVENTORIES—Noncurrent

 

 

63,833

 

 

 

58,413

 

OTHER

 

 

12,004

 

 

 

12,112

 

TOTAL

 

$

950,786

 

 

$

958,024

 

 

 

 

 

 

 

 

 

 

LIABILITIES AND EQUITY

 

 

 

 

 

 

 

 

CURRENT LIABILITIES:

 

 

 

 

 

 

 

 

Accounts payable

 

$

70,595

 

 

$

71,308

 

Accrued expenses

 

 

41,020

 

 

 

52,899

 

Operating lease liabilities

 

 

14,635

 

 

 

19,472

 

Billings in excess of contract revenues

 

 

18,752

 

 

 

32,608

 

Total current liabilities

 

 

145,002

 

 

 

176,287

 

 

 

 

 

 

 

 

 

 

LONG-TERM DEBT

 

 

320,834

 

 

 

323,735

 

OPERATING LEASE LIABILITIES—Noncurrent

 

 

37,777

 

 

 

45,879

 

DEFERRED INCOME TAXES

 

 

62,229

 

 

 

56,466

 

OTHER

 

 

10,164

 

 

 

8,989

 

Total liabilities

 

 

576,006

 

 

 

611,356

 

 

 

 

 

 

 

 

 

 

COMMITMENTS AND CONTINGENCIES (Note 8)

 

 

 

 

 

 

 

 

EQUITY:

 

 

 

 

 

 

 

 

Common stock—$.0001 par value; 90,000 authorized, 65,737 and 65,023 shares issued and outstanding at September 30, 2021 and December 31, 2020, respectively.

 

 

6

 

 

 

6

 

Additional paid-in capital

 

 

307,065

 

 

 

304,757

 

Retained earnings

 

 

65,662

 

 

 

40,937

 

Accumulated other comprehensive income

 

 

2,047

 

 

 

968

 

Total equity

 

 

374,780

 

 

 

346,668

 

TOTAL

 

$

950,786

 

 

$

958,024

 

 

See notes to unaudited condensed consolidated financial statements.

 

3


 

 

Great Lakes Dredge & Dock Corporation and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited)

(in thousands, except per share amounts)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Contract revenues

 

$

168,638

 

 

$

175,841

 

 

$

516,185

 

 

$

561,456

 

Costs of contract revenues

 

 

132,357

 

 

 

139,490

 

 

 

423,906

 

 

 

423,615

 

Gross profit

 

 

36,281

 

 

 

36,351

 

 

 

92,279

 

 

 

137,841

 

General and administrative expenses

 

 

15,167

 

 

 

14,888

 

 

 

45,713

 

 

 

45,263

 

Proceeds from loss of use claim

 

 

-

 

 

 

(1,723

)

 

 

-

 

 

 

(1,723

)

Gain on sale of assets—net

 

 

(291

)

 

 

-

 

 

 

(323

)

 

 

(184

)

Operating income

 

 

21,405

 

 

 

23,186

 

 

 

46,889

 

 

 

94,485

 

Interest expense—net

 

 

(4,214

)

 

 

(6,719

)

 

 

(17,457

)

 

 

(20,074

)

Other income (expense)

 

 

(204

)

 

 

156

 

 

 

692

 

 

 

(400

)

Income before income taxes

 

 

16,987

 

 

 

16,623

 

 

 

30,124

 

 

 

74,011

 

Income tax provision

 

 

(3,181

)

 

 

(4,076

)

 

 

(5,399

)

 

 

(18,517

)

Net income

 

$

13,806

 

 

$

12,547

 

 

$

24,725

 

 

$

55,494

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic earnings per share

 

$

0.21

 

 

$

0.19

 

 

$

0.38

 

 

$

0.86

 

Basic weighted average shares

 

 

65,691

 

 

 

64,860

 

 

 

65,535

 

 

 

64,726

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Diluted earnings per share

 

$

0.21

 

 

$

0.19

 

 

$

0.37

 

 

$

0.84

 

Diluted weighted average shares

 

 

66,311

 

 

 

65,894

 

 

 

66,246

 

 

 

65,861

 

 

See notes to unaudited condensed consolidated financial statements.

 

4


 

 

Great Lakes Dredge & Dock Corporation and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income

(Unaudited)

(in thousands)

 

 

 

Three Months Ended

 

 

Nine Months Ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

13,806

 

 

$

12,547

 

 

$

24,725

 

 

$

55,494

 

Net change in cash flow derivative hedges—net of tax (1)

 

 

(1,211

)

 

 

879

 

 

 

1,079

 

 

 

(2,807

)

Comprehensive income

 

$

12,595

 

 

$

13,426

 

 

$

25,804

 

 

$

52,687

 

 

(1)

Net of income tax benefit of $409 and $296 for the three months ended September 30, 2021 and 2020 respectively.  Net of income tax provision of $(364) and $(959) for the nine months ended September 30, 2021 and 2020 respectively.

See notes to unaudited condensed consolidated financial statements.

 

5


 

 

Great Lakes Dredge & Dock Corporation and Subsidiaries

Condensed Consolidated Statements of Equity

(Unaudited)

(in thousands)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Retained

 

 

Accumulated

 

 

 

 

 

 

 

Shares of

 

 

 

 

 

 

Additional

 

 

Earnings

 

 

Other

 

 

 

 

 

 

 

Common

 

 

Common

 

 

Paid-In

 

 

(Accumulated

 

 

Comprehensive

 

 

 

 

 

 

 

Stock

 

 

Stock

 

 

Capital

 

 

Deficit)

 

 

Income (Loss)

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE—January 1, 2021

 

 

65,023

 

 

$

6

 

 

$

304,757

 

 

$

40,937

 

 

$

968

 

 

$

346,668

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation

 

 

131

 

 

 

-

 

 

 

3,772

 

 

 

-

 

 

 

-

 

 

 

3,772

 

Vesting of restricted stock units and impact of shares withheld for taxes

 

 

431

 

 

 

-

 

 

 

(3,785

)

 

 

-

 

 

 

-

 

 

 

(3,785

)

Exercise of options and purchases from employee stock plans

 

 

152

 

 

 

-

 

 

 

2,321

 

 

 

-

 

 

 

-

 

 

 

2,321

 

Net income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

24,725

 

 

 

-

 

 

 

24,725

 

Other comprehensive income—net of tax

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

1,079

 

 

 

1,079

 

BALANCE—September 30, 2021

 

 

65,737

 

 

$

6

 

 

$

307,065

 

 

$

65,662

 

 

$

2,047

 

 

$

374,780

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE—January 1, 2020

 

 

64,283

 

 

$

6

 

 

$

302,189

 

 

$

(23,091

)

 

$

295

 

 

$

279,399

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation

 

 

80

 

 

 

-

 

 

 

4,891

 

 

 

-

 

 

 

-

 

 

 

4,891

 

Vesting of restricted stock units and impact of shares withheld for taxes

 

 

432

 

 

 

-

 

 

 

(2,174

)

 

 

-

 

 

 

-

 

 

 

(2,174

)

Exercise of options and purchases from employee stock plans

 

 

275

 

 

 

-

 

 

 

1,956

 

 

 

-

 

 

 

-

 

 

 

1,956

 

Repurchase of common stock

 

 

(425

)

 

 

-

 

 

 

(1,792

)

 

 

(2,068

)

 

 

-

 

 

 

(3,860

)

Net income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

55,494

 

 

 

-

 

 

 

55,494

 

Other comprehensive loss—net of tax

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,807

)

 

 

(2,807

)

BALANCE—September 30, 2020

 

 

64,645

 

 

$

6

 

 

$

305,070

 

 

$

30,335

 

 

$

(2,512

)

 

$

332,899

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Accumulated

 

 

 

 

 

 

 

Shares of

 

 

 

 

 

 

Additional

 

 

 

 

 

 

Other

 

 

 

 

 

 

 

Common

 

 

Common

 

 

Paid-In

 

 

Retained

 

 

Comprehensive

 

 

 

 

 

 

 

Stock

 

 

Stock

 

 

Capital

 

 

Earnings

 

 

Income (Loss)

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE—July 1, 2021

 

 

65,654

 

 

$

6

 

 

$

304,977

 

 

$

51,856

 

 

$

3,258

 

 

$

360,097

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation

 

 

58

 

 

 

-

 

 

 

1,207

 

 

 

-

 

 

 

-

 

 

 

1,207

 

Vesting of restricted stock units and impact of shares withheld for taxes

 

 

21

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

Exercise of options and purchases from employee stock plans

 

 

4

 

 

 

-

 

 

 

881

 

 

 

-

 

 

 

-

 

 

 

881

 

Net income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

13,806

 

 

 

-

 

 

 

13,806

 

Other comprehensive income—net of tax

 

 

-

 

 

 

-

 

 

 

 

 

 

 

 

 

 

 

(1,211

)

 

 

(1,211

)

BALANCE—September 30, 2021

 

 

65,737

 

 

$

6

 

 

$

307,065

 

 

$

65,662

 

 

$

2,047

 

 

$

374,780

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE—July 1, 2020

 

 

64,947

 

 

$

6

 

 

$

304,531

 

 

$

19,856

 

 

$

(3,391

)

 

$

321,002

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share-based compensation

 

 

19

 

 

 

-

 

 

 

1,761

 

 

 

-

 

 

 

-

 

 

 

1,761

 

Vesting of restricted stock units and impact of shares withheld for taxes

 

 

20

 

 

 

-

 

 

 

(68

)

 

 

-

 

 

 

-

 

 

 

(68

)

Exercise of options and purchases from employee stock plans

 

 

84

 

 

 

-

 

 

 

638

 

 

 

-

 

 

 

-

 

 

 

638

 

Repurchase of common stock

 

 

(425

)

 

 

-

 

 

 

(1,792

)

 

 

(2,068

)

 

 

-

 

 

 

(3,860

)

Net income

 

 

-

 

 

 

-

 

 

 

-

 

 

 

12,547

 

 

 

-

 

 

 

12,547

 

Other comprehensive income—net of tax

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

879

 

 

 

879

 

BALANCE—September 30, 2020

 

 

64,645

 

 

$

6

 

 

$

305,070

 

 

$

30,335

 

 

$

(2,512

)

 

$