Layne Christensen Co. Earnings: Here’s Why Investors Don’t Like These Results

Layne Christensen Co. (NASDAQ:LAYN) had a loss and missed Wall Street’s expectations, AND came up short on beating the revenue expectation. The revenue miss is a negative sign to shareholders seeking high growth out of the company. Shares are down 0%.

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Layne Christensen Co. Earnings Cheat Sheet

Results: Adjusted Earnings Per Share increased to $-0.91 in the quarter versus EPS of $-4.55 in the year-earlier quarter.

Revenue: Decreased 16.72% to $229.7 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Layne Christensen Co. reported adjusted EPS loss of $0.91 per share. By that measure, the company missed the mean analyst estimate of $-0.29. It missed the average revenue estimate of $254.69 million.

Quoting Management: “Our performance in Q4 FY2013 was slightly better than the forecast we issued in March 2013. With the exception of Inliner, each of our divisions reported quarterly losses and we incurred non-cash charges and non-recurring expenses associated with various aspects of our growth and operating evolution. We expect Layne’s overall profitability will be impacted in FY2014 by temporary weakness at Geoconstruction, continuing investments in our Energy Services Division and higher corporate overhead costs due to our strategic move to The Woodlands, Texas. We expect Heavy Civil to return to profitability by mid-calendar 2013, driven by our progress in working through older projects that do not meet our profitability expectations, securing new projects with higher associated margins and cost savings associated with headcount reductions and other measures at this division. The vast majority of Heavy Civil’s current backlog, which is higher than a year ago, reflects projects we expect to complete at improved margins during FY2014 and beyond. Mineral Exploration should return to profitability in Q1 FY2014, albeit at a lower level than last year. For the year, we believe that exploration programs will continue, but at a slower pace due to the global mining expenditure slowdown and, in some cases, as mining companies work through the integration of large acquisitions. We now believe that this market may be soft for most of FY2014, but could begin to improve in the latter half of this fiscal year as long as gold and copper prices remain stable. Our Energy Services Division remains a key part of our strategy and we expect to announce new contracts and business initiatives in the coming months. We remain focused on new business development across our divisions and are confident in our ability to successfully execute our strategies and perform to our expectations.” Rene J. Robichaud, President and Chief Executive Officer

Key Stats (on next page)…

Revenue decreased 18.8% from $282.88 million in the previous quarter. EPS decreased to $-0.91 in the quarter versus EPS of $0.45 in the previous quarter.

Looking Forward: Analysts have a more negative outlook for the company’s next-quarter performance. Over the past three months, the average estimate for next quarter’s earnings has fallen from a profit of $0.19 to a profit $0.18. For the current year, the average estimate has moved up from a profit of $1.07 to a profit of $1.09 over the last ninety days.

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(Company fundamentals provided by Xignite Financials. Email any earnings discrepancies to earnings [at] wallstcheatsheet.com)