UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 7, 2011
Great Lakes Dredge & Dock Corporation
(Exact name of Registrant as specified in its charter)
Delaware | 001-33225 | 20-5336063 | ||
(State or other jurisdiction of Incorporation or Organization) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
2122 York Road
Oak Brook, Illinois 60523
(Address of Principal Executive Offices)
(630) 574-3000
(Registrants telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 7.01 Regulation FD Disclosure.
Great Lakes Dredge & Dock Corporation (the Company) will be participating at the BB&T C&I Conference on April 7, 2011. The materials to be utilized are attached as Exhibit 99.1 to this report.
The information in this report (including Exhibit 99.1) is being furnished pursuant to Item 7.01 and shall not be deemed to b filed for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended (the Exchange Act), or otherwise be subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act.
Item 9.01 Financial Statements and Exhibits
(d) | Exhibits |
The following exhibit is furnished herewith:
99.1 | Presentation Materials. |
2
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
GREAT LAKES DREDGE & DOCK CORPORATION | ||||
Date: April 7, 2011 | /s/ BRUCE J BIEMECK | |||
Bruce J Biemeck | ||||
President and Chief Financial Officer |
3
EXHIBIT INDEX
Number |
Exhibit | |
99.1 | Presentation Materials. |
Great Lakes
Dredge & Dock BB&T C&I Conference
Growing Through Opportunities
April 7, 2011
Exhibit 99.1 |
Safe
Harbor This presentation includes forward-looking
statements within the meaning of Section 27A of the
Securities Act of 1933, Section 21E of the Securities Exchange Act of 1934, the Private
Securities Litigation Reform Act of 1995 or in releases made by the SEC, all as may be
amended from time to time. Such statements include declarations regarding the
intent, belief, or current expectation of the Company and its management. The
Company cautions that any such forward-looking statements are not guarantees of
future performance, and involve a number of risks, assumptions
and uncertainties that could cause actual results of the Company
and its subsidiaries, or industry
results, to differ materially from those expressed or implied by
any forward-looking statements
contained herein, including, but not limited to, as a result of the factors, risks and
uncertainties described in other securities filings of the Company made with the SEC,
such as the Companys most recent Report on Form 10-K. You should not
place undue reliance upon these forward- looking statements.
Forward-looking statements provided herein are made only as of the date hereof or
as a specified date herein and the Company does not have or undertake any obligation to
update or revise them, unless required by law.
2
April 2011
Growing Through Opportunities |
Who is Great
Lakes Dredge & Dock Corporation? 3
Avalon & Sea Isle Beach Nourishment
Oresund Bridge
International land reclamation
Jacksonville, FL Harbor Deepening
Hunters Point Waterfront Park
Dredge Florida Cutterhead
Growing Through Opportunities
April 2011 |
Great Lakes
Highlights
Significant growth since 2006
Revenue -
three-year CAGR of 10.0%
EBITDA -
three-year CAGR of 21.4%
Significant investment in PP&E of $140M since 2006
Purchased four dredging vessels in 2007 as well as built a piece
of
ancillary equipment
Upgraded dredge Ohio into world-class cutter suction dredge
Decreased Net Debt / EBITDA from 6.4x at 12/31/05 to 1.3x at
12/31/10
Over $48M in cash on hand at year-end
increase in 2011 as result
of refinancing of notes
Over $145M of availability on revolving credit facility
4
Growing Through Opportunities
April 2011 |
Management
Team 5
Board member since December 2006
Former Managing Director and Co-head of Corporate Finance for Navigant Consulting,
Inc Former partner at KPMG, LLP and past National Partner in charge of Corporate
Finance at KPMG
Jonathan Berger
Chief Executive
Officer and Director
Board member since December 2006
Significant institutional knowledge as Senior Vice President, CFO and Treasurer of Great
Lakes from 1991 to 1999
Private real estate investor and independent consultant since April 1999
Bruce Biemeck
President and Chief
Financial Officer,
Director
Growing Through Opportunities
April 2011
David Simonelli
President of Dredging
Operations
Served as Chief Site Manager from 2007 to February 2009 and Senior Vice President from
February 2009 to April 2010
Joined Great Lakes in 1978 as a Project Engineer, and has served
the Company in various
roles since that time
Member of the Hydrographic Society, the Western Dredging Association and the American
Society of Civil Engineers |
Acquisition of
L.W. Matteson On December 31, 2010, Great Lakes acquired the assets of L.W.
Matteson L.W. Matteson is a leading inland dredging and marine construction
contractor
Serves four primary markets in the U.S. including: Inland Levee and
Construction, Inland Maintenance Dredging, Environmental and Habitat
Restoration, and Inland Lake Dredging
The purchase price was $45 million, with $37.5 million paid at closing and a note
payable to the seller of $7.5 million (approximate EBITDA multiple of 3.0x)
L.W. Matteson has experienced strong growth and provides Great Lakes with a
platform to enter new markets
6
Growing Through Opportunities
April 2011 |
Strategy
New Strategy (in formulation stage)
Must develop a risk-based growth strategy
which takes advantage of our many strengths
Complex engineering
Maritime construction knowledge
Project management
Extensive and versatile fleet
Strong balance sheet
Areas to explore
Domestic dredging markets in which we
do not participate
International dredging
Environmental services
Other maritime and Jones Act related
business
Aggregate mining and sales
Specialty construction
Historical Strategy (through Private Equity ownership)
Ride the cyclical wave of domestic dredging, pay down debt and opportunistically
take advantage of international markets
7
Growing Through Opportunities
April 2011 |
Significant
Opportunities to Grow U.S. Port Deepening
Post Panama Canal
Deepening
Harbor Maintenance
Trust Fund
Environmental
Services/Dredging
Gulf Coast Restoration
International
Levee Repairs
8
Growing Through Opportunities
April 2011 |
Dredging
Innovative Civil Engineering Solutions Since 1890
9
Growing Through Opportunities
April 2011 |
Domestic
Dredging Market 10
Growing Through Opportunities
April 2011 |
Foreign
Dredging Market 11
Growing Through Opportunities
April 2011 |
Dredging
Overview Deepening ports, land reclamation, and
excavation of underwater trenches
Maintenance
Maintaining depth of shipping channels
Army Corps of Engineers (Largest)
Port authorities
State and local governments
Foreign governments
Prime contractors on turn-key projects
Private entities (e.g., oil companies, utilities)
Customers
Beach Nourishment
Creating and rebuilding beaches
Capital
12
Growing Through Opportunities
April 2011 |
Large and
Flexible Fleet in U.S and International Markets Types of Dredges
Hydraulic
20 Vessels: 16 U.S., 4 Middle East
(19 U.S. flagged)
Including the only two large electric
cutterhead dredges available in the
U.S. for environmentally sensitive
regions requiring lower emissions
Hopper
10 Vessels: 4 U.S., 5 Middle
East, 1 Brazil (4
U.S. flagged)
Highly mobile, able to operate in
rough waters
Little interference with other
ship traffic
Mechanical
5 Vessels: All U.S (All U.S. flagged)
Operates one of two environmentally
friendly electric clamshell dredges in
the U.S.
Maneuverability in tight areas such
as docks and terminals
Estimate fleet replacement cost in excess of $1.5 billion in current market
25
Material
Transportation
Barges
and
Over
160
Other
Specialized
Support
Vessels
Dredge Texas at Boca Raton
Dredge Liberty Island at Melbourne
Beach
Dredge GL 55 at Upper Chesapeake
13
Growing Through Opportunities
April 2011 |
Our
Intellectual Property and Human Capital are a Competitive Advantage 14
Growing Through Opportunities
April 2011 |
Industry
and Company Overview 15
Growing Through Opportunities
April 2011 |
Attractive
Catalysts in the Dredging Market
Maintenance Dredging
Harbor Maintenance Trust Fund legislation passage could add $500M to the
Companys bid market
Panama Canal expansion leads to U.S. port deepening
Coastal Restoration throughout Gulf Area
Levee repair/replacement throughout U.S.
Bayou Dupont, LA
Coastal Restoration
Dredge California and GL 55 at Pass a Loutre
Coastal Restoration
16
Growing Through Opportunities
April 2011 |
(in
millions) Three Year Average
FY 2009
FY 2010
Bid Market Size
$325
$310
$356*
GLDD Revenue
$219
$203
$301
Domestic Dredging Industry Demand Drivers
Capital
U.S. ports 5'10' shallower vs. foreign ports
Domestic port development required to
support larger, deeper draft ships
Long-term funding for wetland and coastal marshes
Other port development
Berm construction off Louisiana coast
17
Growing Through Opportunities
April 2011
*Note:
The
2010
bid
market
excludes
dredging
work
related
to
the
construction
of
sand
berms
off
the
coast
of
Louisiana |
(in
millions) Three Year Average
FY 2009
FY 2010
Bid Market Size
$127
$183
$ 76
GLDD Revenue
$
77
$
62
$106
Domestic Dredging Industry Demand Drivers
Beach Nourishment
Storm activity/natural erosion
Growing population in coastal communities
22 of the 25 most densely populated U.S. counties are
coastal
Importance of beach assets to recreation and local tourism
industry
Anticipate robust market opportunities in next 12 months
Melbourne Beach
18
Growing Through Opportunities
April 2011 |
(in
millions) Three Year Average
FY 2009
FY 2010
Bid Market Size
$478
$645
$444
GLDD Revenue
$130
$175
$119
Domestic Dredging Industry Demand Drivers
Maintenance
Corps of Engineers
goal is to reach 95% of U.S. port operating
capacity
Natural sedimentation and volatile weather
New capital projects increase need for ongoing maintenance
57% of 2009 domestic bid market was maintenance work
Dredge 54 at NYCT Berth
19
Growing Through Opportunities
April 2011 |
(in
millions) Three Year Average
FY 2009
FY 2010
GLDD Revenue
$130
$134
$
83
Great Lakes is Well Positioned to Compete Globally
International
International projects tend to be larger/ longer duration vs. domestic
projects
Middle East has been a strong market historically, and is expected to
provide good opportunities in the future
Upgrade of the dredge Ohio completed at the end of 2010. Will allow us
to meet future demand anticipated in Middle East
Deepening project in Brazil began in September
Strong market ahead in Brazil
Reem
Island at Port of Natal, Brazil
20
Growing Through Opportunities
April 2011 |
Largest
Provider of Dredging 28%
10%
8%
21%
33%
Foreign
Capital
Maintenance
Beach
Demolition
2009 REVENUE BY WORK TYPE
$622 million
8%
9%
47%
7%
29%
Great Lakes
Norfolk
Weeks
Manson
Other
2009 DOMESTIC DREDGING BID MARKET
SHARE
Domestic Bid Market: $1,137 million
44%
17%
16%
11%
12%
Foreign
Capital
Maintenance
Beach
Demolition
2010 REVENUE BY WORK TYPE
$687 million
12%
4%
24%
4%
30%
26%
Great Lakes
Norfolk
Weeks
Manson
Don Jon
Other
2010 DOMESTIC DREDGING BID MARKET
SHARE
Domestic Bid Market: $875 million
21
Growing Through Opportunities
April 2011 |
(in
millions) Three Year Average
FY 2009
FY 2010
Demolition Revenue
$
76
$
48
$
78
Demolition Services -
The Preferred Demolition Contractor in New England
NASDI and Yankee Environmental Services
Major U.S. provider of commercial and industrial demolition services;
primarily in New England
Purchased Yankee in 2009; able to offer removal of asbestos and
hazardous materials
Successfully gaining foothold in New York market over last year
Strong bonding capacity
Currently expanding into new domestic markets with contract awarded
in Louisiana
Massachusetts Mental Health Hospital
22
Growing Through Opportunities
April 2011 |
Financial
Highlights 23
Growing Through Opportunities
April 2011 |
Financial
Performance 0
100
200
300
400
500
600
700
$800
2006
2007
2008
2009
2010
Capital
Maintenance
Beach
Foreign
Demolition
$52.6
$57.5
$55.9
$103.0
$77.6
9.5%
15.0%
12.5%
12.3%
11.1%
(20)
0
20
40
60
80
100
$120
2006
2007
2008
2009
2010
0.0%
4.0%
8.0%
12.0%
16.0%
20.0%
Dredging
Demolition
% EBITDA Margin
ANNUAL REVENUE
3 year CAGR = 10.0%
ANNUAL EBITDA
(a)
3 year CAGR =
21.4%
(a)
EBITDA represents net income (loss), adjusted for net interest expense, income
taxes, depreciation and amortization expense. Please see reconciliation of
Net Income to EBITDA at the end of this presentation.
Note: Great Lakes went public in December 2006
($ in millions)
$426.0
$515.8
$586.9
$622.2
$686.9
24
Growing Through Opportunities
April 2011 |
Improved
Financial Flexibility $25.7
$44.5
$111.0
(a)
$29.8
$12.7
$66.0
(b)
0.0
20.0
40.0
60.0
80.0
100.0
$120.0
2005
2006
2007
2008
2009
2010
Maintenance
Growth
6.4x
3.6x
3.3x
3.7x
2.4x
1.3x
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0x
2005
2006
2007
2008
2009
2010
Net Debt / EBITDA
(a)
Growth capital expenditures during the year of 2007 includes the purchase of four
vessels. (b)
Includes $14.6m related to the upgrade of the dredge Ohio and $36m related to
Matteson acquisition CAPEX
LEVERAGE
($ in millions)
25
Growing Through Opportunities
April 2011 |
0
100
200
300
400
500
12/31/2006
12/31/2007
12/31/2008
12/31/2009
12/31/2010
Capital
Maintenance
Beach
Foreign
Demolition
Rivers & Lakes
$
Backlog
BY SEGMENT
$364
$382
$385 (a)
$360
$369
(a)
Foreign
backlog
at
December
31,
2008
has
been
adjusted
for
the
portion
of
the
Diyar
contract
that
became
an
option
pending
award
in
the
first
quarter
of
2009
($ in millions)
26
Growing Through Opportunities
April 2011 |
Investment
Highlights
Attractive near and long-term catalysts in U.S dredging market
Harbor Maintenance Trust Fund secures funding for long-term maintenance demand
Other sources of dredging demand include coastal restoration, port deepening and port
development and levee repair/replacement
Strong financial performance and improved financial flexibility
Revenue
3 year CAGR 10%, EBITDA
3 year CAGR 21.4%
EBITDA growth from $45.1 million in 2005 to $103.0 million in 2010
Decreased Net Debt / EBITDA from 6.4x in 2005 to 1.3x in 2010
International Presence
Only U.S. dredger with significant foreign presence
Flexible fleet enables repositioning of vessels as necessary
Demonstrated record of successful project completion never having failed to complete a
project
Expanding demolition business
Opportunistic acquirer of dredging assets
27
Growing Through Opportunities
April 2011 |
Appendix
28
Growing Through Opportunities
April 2011 |
Reconciliation of Net Income to EBITDA
$103.0
34.3
20.6
13.5
$34.6
2010
$52.6
25.1
1.0
24.3
$2.2
2006
$57.5
26.5
6.4
17.5
$7.1
2007
$77.6
33.0
11.0
16.1
$17.5
2009
$55.9
30.1
3.8
17.0
$5.0
2008
Depreciation and Amortization
($ in millions)
Net Income Attributable to Great Lakes Dredge &
Dock Corporation
Interest Expense
Income Tax Expense
EBITDA
29
Growing Through Opportunities
April 2011 |
0
20
40
60
80
100
120
140
12/31/2006
12/31/2007
12/31/2008
12/31/2009
12/31/2010
GLDD
ORN
STRL
GVA
Stock Performance
Initial Investment $100
*Note: ORN, STRL, and GVA were selected as GLDDs
three closest peers
30
Growing Through Opportunities
April 2011 |
Stock
Performance Initial Investment $100
40
50
60
70
80
90
100
110
120
130
140
12/31/2006
12/31/2007
12/31/2008
12/31/2009
12/31/2010
GLDD
Peers
NASDAQ
Russel 2K
31
Growing Through Opportunities
April 2011 |