MORGAN CITY, La. — Conrad Industries Inc. had net income of $3.7 million, or 58 cents a share, in the first quarter ended March 31. This compares to net income of $1.7 million and 27 cents a share during the first quarter of 2010.
Conrad’s backlog was $112.3 million on March 31, compared to $89.5 million on Dec. 31, and $48.9 million on March 31, 2010.
Johnny Conrad, the company’s president and CEO, said that while new construction backlogs continued to improved, repair work was negatively affected during the quarter by the post-Deepwater Horizon slowdown in the Gulf of Mexico and “continued uncertainties surrounding the issuance of drilling permits by the Department of the Interior and new regulations related to drilling operations.”
“Although we continue to be optimistic about the long-term prospects of our business and market conditions are much improved compared to last year, there still remains some uncertainty about our shorter-term demand and margins, particularly in our repair segment,” Conrad said in a statement accompanying the earnings release.
Conrad also commented about the potential adverse impact on business from rising water levels along the Mississippi and Atchafalaya rivers. Three of the company’s four shipyards are located in south Louisiana, one along the Atchafalaya River in Morgan City and the other two in Amelia along the Intracoastal Waterway.
“We have temporarily discontinued operations at our Morgan City shipyard which is located on the Atchafalaya River outside the protection of the levee system and have taken steps to safeguard our assets and to mitigate the effects of this situation on our operations,” Conrad said. “Vessels under construction and key pieces of our equipment have been moved to our other shipyards. Production personnel, as well as support and administrative staff, have been relocated to our other facilities in the area.”
Conrad’s two yards along the Intracoastal Waterway may also be affected by rising water levels but are currently operational and have taken on the work moved from the Morgan City yard. “Although we do not anticipate any significant flooding at the yards, there may be limits on the ability of vessels to access the yards,” Conrad said.