Energy services company Willbros Group, Inc. (WG) on Wednesday reported a 25% drop in profit for the first quarter from the year-ago period on a 6% decline in revenues. The results for the latest quarter include severance charges, while the year-ago period's results include income from discontinued operations. For fiscal year 2009, the company lowered its earnings and revenue outlook.
For the first quarter, the company's net income declined to $15.49 million, or $0.39 per share, from $20.78 million, or $0.52 per share, for the year-ago quarter.
During the latest quarter, Willbros incurred severance charges of $4.7 million associated with right-sizing its operations and administrative activities. The year-ago quarter's results includes income from discontinued operations of $2.56 million, or $0.06 per share.
Income from continuing operations for the quarter was $16.08 million, or $0.39 per share, down from $18.68 million, or $0.46 per share, in the prior-year period.
On average, thirteen analysts polled by Thomson Reuters expected the company to earn $0.39 per share for the quarter. Analysts' estimates typically exclude special items.
Revenue for the first quarter declined 6% to $463.93 million from $491.63 million in the prior-year quarter. Analysts had a consensus revenue estimate for the quarter of $423.37 million.
The decline in revenues was due primarily to lower levels of activity in the company's engineering segment, which benefited from the more robust engineering, procurement and construction activity in the year-ago period.
Upstream O&G revenue for the quarter increased to $339.55 million from $325.29 million a year ago and downstream O&G revenue increased to $100.42 million from $99.74 million in the same period last year. Engineering segment revenue for the quarter fell to $23.95 million from $66.60 million a year ago.
Operating income for the quarter declined to $26.10 million from $35.30 million in the previous-year quarter.
As at March 31, 2009, Willbros reported backlog from continuing operations of $543.9 million, compared to $655.5 million as at December 31, 2008.
Looking ahead, the company noted that visibility for the second half of 2009 continued to be limited due to the rapidly changing business environment.
Accordingly, for fiscal year 2009, Willbros lowered its outlook for earnings to a range of $0.80-$1.10 per share from the prior range of $1.10-$1.50 per share.
The company also cut its forecast for revenues for the year to a range of $1.1 billion-$1.3 billion, down from the prior range of $1.2 billion-$1.5 billion.
Analysts currently expect the company to report earnings of $1.21 per share on revenue of $1.43 billion for the year.
WG closed Wednesday's regular trading session at $13.40, up $0.17 or 1.28% on a volume of 0.51 million shares.
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