Houston-headquartered Great Lakes Dredge & Dock Corporation (Nasdaq: GLDD), the largest provider of dredging services in the U.S., today reported financial results for the quarter ended September 30, 2022, that included a net loss of $9.9 million, compared to a net income of $13.8 million in the prior year third quarter. Adjusted EBITDA was $1.3 million compared to $32,194 million in the 2021 third quarter
“We continue to see the effects from a significantly delayed bid market the last three quarters, which has impacted vessel utilization for 2022,” said President and CEO Lasse Petterson. “In addition, the quarter was impacted by increased inflationary pressure, follow-on impact from second quarter site condition claims and some dredging project challenges. Great Lakes has delivered strong performance over the past years, we have demonstrated our ability to manage through a challenging environment and we believe the current challenging conditions will improve over the next quarters.
“The bid market did start to gain momentum in the third quarter and Great Lakes was awarded $338.9 million in dredging projects and open options, ending the quarter with $452.6 million of dredging backlog, which does not include approximately $50.0 million dollars of performance obligations related to offshore wind contracts. In addition, we ended the quarter with $625.7 million in open options pending award. This indicates that the bid market is in the process of recovery from the bidding difficulties that we have seen in 2022. The company’s awarded work represents 50.1% of the third quarter bid market.
“Our newbuild program is on schedule, with the new hopper dredge, the Galveston Island, expected to be ready for operations in the first half of 2023 and her sister ship is expected to be ready for operations in the first half of 2025. The delivery of the Galveston Island will provide us with added capacity and the opportunity to potentially retire some of our older dredges which is expected to have a positive impact to our overall margins in the coming years. In addition, the liquified natural gas export projects that are bid but not yet awarded are getting closer to final investment decisions.
“Our recently announced offshore wind award by Equinor and BP, with expected commencement in 2025, solidifies Great Lakes’ goal of participating in the U.S. offshore wind market. We presently have five additional bids tendered for other offshore wind projects, which we anticipate will add to our offshore wind backlog during 2023.
“As we enter the fourth quarter, we expect results to improve as our fleet is expected to be busy this quarter and in the first quarter of 2023. We believe the fundamentals are in place for a return to a normal dredging market in 2023 and that the ongoing demand for dredging, combined with our strategy for overall improvement is a solid path to long term growth.”
Read More: GLDD reports red ink quarter, but sees bid market starting to gain momentum