LANCASTER, N.Y., June 21, 2013 (GLOBE NEWSWIRE) -- Ecology and Environment, Inc., ("E & E" or the "Company") (Nasdaq:EEI) reported consolidated revenues for the third quarter of fiscal year 2013 of $32.2 million, a decrease of $3.8 million or 11% from the $36.0 million reported in the third quarter of fiscal year 2012. Revenue less subcontract costs of $26.1 million for the current quarter decreased $3.9 million or 13% compared to the third quarter of fiscal year 2012. E & E reported a net loss of $0.4 million or $.10 per share for the third quarter of fiscal year 2013, a decrease of $0.5 million from the net income of $0.1 million or $.01 per share reported in the third quarter of the prior year. Compared to the second quarter of fiscal year 2013, net income for the third quarter decreased $2.3 million.
Consolidated revenues for the first nine months of fiscal year 2013 were $105.2 million, a decrease of $13.3 million or 11% from the $118.5 million reported in the first nine months of fiscal year 2012. Revenue less subcontract costs of $86.6 million for the first nine months of fiscal year 2013 decreased $7.2 million or 8% compared to the same period in the prior fiscal year. Net income of $1.7 million or $.40 per share for the first nine months of 2013 was relatively unchanged from net income reported for the same period last year.
E & E's expansion to countries in the Middle East, Africa and Asia over the past several years has resulted in heightened political, regulatory, and cultural risks within these regions in comparison with similar risks associated with its business in the United States, Canada and South America. The Company has experienced slow and inconsistent collections from clients in the Middle East, Africa, and Asia, which in turn has had a significant impact on the comparability of its quarterly and annual results due to large swings in allowances established to record contract receivables at expected amounts.
In January 2013, E & E announced that it had entered into a contract to provide environmental consulting services to a client in Asia. This contract replaced a previous agreement dated in fiscal year 2011. Through April 30, 2013, the Company encountered significant transitional issues and delays in collecting payments due to it under this agreement. After considering the age of contract receivables, non-payment of advanced payments owed to us under the agreement and the lack of any other cash collections to date, the Company recorded $0.4 million and $1.5 million of additional allowance for doubtful accounts and contract adjustments related to these projects during the three months and nine months ended April 30, 2013, respectively. Management is actively working with the client to validate the ongoing viability of these projects, and to procure cash payments due to us. Management is also considering potential actions by the Company in the event of continued delays in receiving cash payments owed to us, which may include recording additional allowance for doubtful accounts and contract adjustments and possible termination of project activity in future reporting periods.
During the first nine months of 2013, E & E management critically reviewed technical and indirect staffing levels, other expenses necessary to support current project work levels, and key administrative processes. As a result of this review, the Company reduced staff counts in various technical and indirect departments and reduced utilization of contracted services. These reductions are expected to decrease operating expenses by $2.5 to $3.0 million annually. E & E management continues to critically evaluate its organizational and cost structure to identify ways to operate more efficiently and cost effectively.
E & E has completed over 50,000 projects for a wide variety of clients in 122 countries, providing environmental solutions in nearly every ecosystem on our planet. E & E is listed on the NASDAQ under the symbol EEI and the information contained in this press release is available on the Company's website at www.ene.com.
|Financial Report -|
|(In thousands, except per share information)|
|Three Months Ending|
|April 30, 2013||April 30, 2012|
|Revenue||$ 32,219||$ 36,011|
|Revenue less Subcontract Costs||$ 26,058||$ 30,040|
|Net Income||$ (441)||$ 56|
|Net Income Per Common Share: Basic and Diluted||$ (0.10)||$ 0.01|
|Nine Months Ending|
|April 30, 2013||April 30, 2012|
|Revenue||$ 105,192||$ 118,496|
|Revenue less Subcontract Costs||$ 86,604||$ 93,825|
|Net Income||$ 1,713||$ 1,719|
|Net Income Per Common Share: Basic and Diluted||$ 0.40||$ 0.41|
CONTACT: Mr. John Mye, P.E. Vice President, Treasurer, and Chief Financial Officer (716) 684-8060 firstname.lastname@example.orgSource:Ecology and Environment, Inc.