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Press release from CNW Group

The Churchill Corporation Reports Second Quarter 2011 Results and Declares Quarterly Dividend

Tuesday, August 09, 2011

The Churchill Corporation Reports Second Quarter 2011 Results and Declares Quarterly Dividend20:39 EDT Tuesday, August 09, 2011Robust Outlook Reaffirmed Despite Short-Term Weather and Margin IssuesCALGARY, Aug. 9, 2011 /CNW/ - The Churchill Corporation (TSX: CUQ, CUQ.DB) ("Churchill" or the "Corporation") today released its second quarter 2011 results and declared a quarterly dividend of $0.12 per common share. The dividend will be paid October 14, 2011 to shareholders of record on September 30, 2011. The ex-dividend date is September 28, 2011. The Corporation has a dividend reinvestment plan in place for which details are available on Churchill's website (www.churchillcorporation.com).OPERATIONAL HIGHLIGHTSBacklog increases by 10% to $1.7 billion as of June 30, 2011.$1 billion of backlog additions announced year-to-date, including awards subsequent to June 30, 2011.Acquired McCaine Electric, growing the Commercial Systems segment into Manitoba, adding $5 million of revenue in the quarter with strong margins.FINANCIAL HIGHLIGHTS    3 Months Ended June 306 Months Ended June 30($millions, except per share amounts)2011201020112010Contract revenue$                      340.9$                      223.4$                      645.6$                      405.9Contract income35.726.072.349.8Earnings before interest, taxes, depreciation andamortization (EBITDA)17.014.634.227.8Net earnings5.89.511.517.8Net earnings per common share- Basic0.240.550.481.02- Diluted0.220.510.470.96   As of June 30, 2011As of Dec. 31, 2010Backlog  $                  1,705.6$                  1,555.0Long-term indebtedness  165.8148.6Total assets  887.1871.8Second quarter 2011 results are presented in conformance with International Financial Reporting Standards ("IFRS") and prior year second quarter results have been restated accordingly. All figures are in Canadian dollars unless otherwise noted. Certain financial and operational measures referred to in this press release, including "EBITDA" and "backlog", are not prescribed under IFRS. For a description of these measures, see the Terminology section in Churchill's second quarter 2011 management discussion and analysis ("MD&A").Revenue for the quarter was $340.9 million compared to $223.4 million in the second quarter of 2010.Quarterly earnings before interest, taxes, depreciation and amortization ("EBITDA") were $17.0 million, compared to $14.6 million reported in the second quarter of 2010.Net earnings were $5.8 million, compared to $9.5 million recorded in the second quarter of 2010. Basic and diluted earnings per share were $0.24 and $0.22 respectively for the 2011 second quarter.Backlog increased 10% to $1,706 million as of June 30, 2011, compared to $1,555 million on December 31, 2010 and $1,577 million on March 31, 2011.Stuart Olson Dominion Construction Ltd. ("SODCL"), which forms Churchill's General Contracting segment, generated second quarter 2011 revenue of $215.9 million; EBITDA was $7.6 million, with an EBITDA margin of 3.5%.Canem Systems Ltd. ("Canem"), an electrical and data systems contractor, which forms Churchill's Commercial Systems segment. Canem produced EBITDA of $5.3 million with an EBITDA margin of 11.6% in the second quarter of 2011.Laird Electric Inc. ("Laird"), Insulation Holdings Inc. ("IHI") and Broda Construction Inc. ("Broda") of Churchill's Industrial Services segment produced 2011 second quarter EBITDA of $5.2 million, with an EBITDA margin of 5.6%.OUTLOOK"During the second quarter of 2011 we continued to grow our operations base and add quality projects to our backlog," said Jim Houck, Churchill's President and CEO. "These actions provide visibility of our future revenue streams and strengthen our outlook. Project delays cost us about $42 million of revenue in the second quarter, largely due to an unusually wet spring season, and profit margins remained under pressure as we continued to execute lower margin legacy projects. However, we expect revenue and earnings to improve as we work through a drier summer season and margins to strengthen towards the end of 2011 and into 2012 as we experience an increase in the proportion of recently awarded higher margin work coming out of backlog.""Going forward, we expect that Stuart Olson Dominion will continue to accumulate a portfolio of high potential projects in its backlog, Canem will continue to execute on its best-in-class operational efficiencies and Broda will continue to win profitable projects in the civil and mining sectors," continued Mr. Houck. "As well, we expect Laird and IHI will continue to build on their strong safety records and operational excellence to grow their operations throughout Western Canada's thriving resource-based economy. We will continue to create value for our shareholders by building on the profitable organic growth of our five operating companies and, when conditions are right, executing acquisitions that enhance our strategic goals and fit our entrepreneurial culture."CONFERENCE CALLThe Corporation will host a conference call discussing Churchill's second quarter results at 9:00 a.m. Eastern Time on August 10. To listen to the conference call, visit www.churchillcorporation.com/live_events.php.A full copy of Churchill's second quarter 2011 management's discussion and analysis, financial statements and notes can be obtained at www.sedar.com and on Churchill's website (www.churchillcorporation.com).About The Churchill CorporationThe Churchill Corporation provides building construction, commercial and industrial electrical contracting, earthmoving and industrial insulation services to an array of public and private sector clients. Churchill operates office locations throughout British Columbia, Alberta, Saskatchewan, Manitoba, northwest Ontario and the Yukon. Churchill common shares and convertible debentures are listed on the Toronto Stock Exchange under the symbols "CUQ" and "CUQ.DB", respectively. www.churchillcorporation.comForward Looking InformationCertain statements in this Press Release may constitute "forward-looking statements". Forward-looking statements include, without limitation, statements regarding the future financial position, business strategy, budgets, litigation, projected costs, capital expenditures, financial results, taxes, plans and objectives of the Corporation. Many of these statements can be identified by looking for words such as "believes," "expects," "may," "will," "intends," "anticipates," "estimates," "continues," or the negative thereof, or other variations thereon. Although management of Churchill believes its expectations regarding future performance of the Corporation, including its revenue and earnings and the future performance of its operating subsidiaries, are based on currently available competitive, financial and economic data, market conditions and operating plans, it can give no assurance its expectations will be achieved. Forward-looking statements relating to future acquisitions are based on management's expectations relating to the Corporation's ability to identify potential acquisition targets and its ability to successfully initiate and consummate the acquisition of such targets. Management's expectations relating to acquisitions are based on management's expectations relating to the Corporation's ability to finance acquisitions and the Corporation's track record in identifying and successfully completing acquisitions. The Corporation cautions that, by their nature, forward-looking statements, involve risks, and uncertainties and that its actual actions, and/or results could differ materially from those expressed or implied in such forward-looking statements, and that the aforementioned risks, uncertainties and actions could affect the extent to which a particular projection materializes. The Corporation assumes no obligation to update the forward-looking statements should circumstances or the Corporation's management's estimates or opinions change, except as may be required by law. For further information: James C. Houck, B.Sc., MBA President and Chief Executive Officer The Churchill Corporation (403) 685-7777       Andrew Apedoe Vice President Investor Relations & Secretary The Churchill Corporation (403) 685-7775 Email: inquiries@churchill-cuq.com       Ken Wetherell, CFA Director, Investor Relations The Churchill Corporation (403) 685-7776 Email: inquiries@churchill-cuq.com