Q4 2019 Earnings Call
Good afternoon, welcome, ladies and gentlemen to the Gulf Island fabrication fourth quarter 2019 earnings Conference call. All participants will be in listen only mode for the duration of this presentation. This call is being recorded at this time I would like to turn the conference Overachieve Ms. Cindy Cook for opening remarks and introductions Cindy. Please go ahead.
Thank you and good afternoon, I would like to welcome everyone to Gulf Island fourth quarter 2019 teleconference.
Our results were released this afternoon and a copy of the press release is available on our website <unk> Gulf Island Dot com.
A replay of today's call will be available on our website. After seven P.M. This evening.
Please keep in mind that the press release and certain comments on this call include forward looking statement and actual results may differ materially.
We've been likes to refer everyone to the cautionary language included in our press release.
The risk factors described in our 2018 form 10-K, and subsequent FCC filing.
Please also note that management may reference EBITDA adjusted EBITDA in backlog on this call, which are financial measures not recognized under you asked gap.
As required by FCC rules and regulations. These non-GAAP financial measures are reconciled to their most comparable GAAP financial measures in our press release.
Today, we have Mr. Richard.
Uh-huh, President and CEO, and Mr. West Austin, Executive Vice President and Chief Financial Officer Mr. Huh.
Thank you Sandy.
Good afternoon, everyone.
We used to be here with you. This afternoon and it's been approximately 100 days since I joined the company I'm excited about the potential opportunities ahead.
Before addressing the quarter, let me first discuss why joined Gulf Island.
Obviously I've been both customer a consultant to the company before assuming the role of Chief Executive Officer.
As a customer I had the opportunity to to work with Gulf Island for the construction of a large grassroots petrochemical complex in Lake Charles Louisiana, and experienced the quality of work and their ability to safely deliver on their commitments.
Oh fallen was instrumental in helping US theorist. This large project by assembling heater modules in their home, Louisiana fabrication yard and using its water access to bars the modules to the project site.
This all start activity provided by Galfan enabled us to decrease the craft manpower demand on our pet predominantly stick built.
Project by over 300 people. The construction has been particular petrochemical complex was one of only a few projects under construction at the time that was on budget and on schedule and it was widely viewed as the success.
This previous experience combined with my experience as a consultant prior to joining Gulf Island gives me a strong appreciation for the company's legacy screens the desire of its employees to be successful and the quality of the company's asset Louisiana.
However, all Gulf Island has a history of safely delivering quality products and services in recent years. The company has been challenged to do so probably.
Growing our business and returning to profitability will be my central focus as we repositioned the company for future success.
Since joining Gulf Island, I have spent significant time with our customers and employees reviewing current projects and prospects and identifying opportunities to enhance our people processes and procedures. As a result today, we're announcing several initial initiatives to improve our execution capabilities.
Positioning in our end markets and.
To profitability.
First will be more discipline and pursuing and evaluating prospects, we cannot and will not fit every opportunity that we see in the market.
Resources will be focused on profitable opportunities in which we offer a competitive and strong value proposition to our customers.
Tell you we have already know bid prospects that we don't believe our real or projects that have too much underlying risk for the contract price.
Are those projects, we choose to pursue we're placing increased rigor around the development of our bed estimates, including a full assessment of the execution plan and the associated risks and opportunities inherent in the projects as well as the appropriate pricing such risks for example, we're pushing back on trying.
Does that do not reflect our acceptable level of risk in many of these circumstances, we are receiving commercial considerations.
To improve our project execution, we're also making fundamental changes to our management and functional leadership. This includes replacing and repositioning personnel where necessary to ensure that the most capable people are in the right functional roles as well as holding leadership accountable for project execution.
For example in the fourth quarter, we assign project execution responsibility for the vessels being built in our fabrication division to our shipyard division to better align the supervision and construction that these vessels with a capability and expertise of our shipyard division.
We're also focusing our efforts on improving our project management teams to provide better cost and schedule control processes and commercial management of our projects underlying this increase discipline rigor around but better estimates and personnel changes will be consistent and improved processes.
And procedures.
The second area of focus is to maximize our resource utilization and centralized key.
Project resources as a result, we're closing our Jennings facility within our shipyard division, which will consolidate and home our new build marine vessel construction activities and combine our shipyard management and supervision team in one single location.
In addition, the first quarter, we combined our fabrication division and services division to form a new and fully integrated segment.
Location and services Division will enable us to further leverage the best practices and the experience of the combined New division.
These facility and division consolidations will help us maximize the utilization bar resources reduce cost and improve our focused on project execution by placing our best resources in one location to ensure we are executing our projects ultimately.
With strength, then processes procedures and talent as well as a more focused footprint and home on Louisiana, we will be much better positioned to concentrate our efforts on our chosen end markets and the case of our fabrication and services Division, we will continue to provide fabrication and associated services to our traditional off.
Sure markets.
What are significantly increasing our business development efforts on the fabrication of modules piping systems and other structures for onshore refining.
Petrochemical LNG and industrial facilities, there is a significant amount of capital projects within a 300 mile radius of homa anticipated in the next three to five years and we are determined and we will be well positioned to get our share this market opportunity.
With respect to our ship shipyard Division, we will maintain our focus on opportunities for new build marine vessels for government and other customers unrelated to the offshore oil and gas sector.
However, we will do so with an emphasis on improved margins for our New project awards, including increased the shipyard repair and maintenance work.
Going forward, we're building a strong foundation that will enable us to execute our existing backlog the completion and fully leverage our dedicated workforce and strategic location and homa to secure attractive New project awards to drive profitable growth.
With an increased the level of discipline and emphasis on our processes and people as well as it let's focus on safety and quality I'm confident that golf on and we'll get back to our winning ways.
I'll now turn over the call to west to discuss our quarterly financial results in greater detail and then I will address the project impacts for the quarter and the status of such projects.
Thanks, Richard Good afternoon, everyone. Let me first provide some summary comments regarding our fourth quarter results as well as our year to year end liquidity position.
Fourth quarter revenue was 79.4 million, an increase of approximately 5% sequentially and 32% year over year. Despite this growth we expect several impacts during the quarter, resulting in a consolidated net loss of 34.3 million. These impacts included project charges, a 14 million primarily attributable to.
Our fabrication shipyard divisions, and noncash asset impairments and other nonrecurring cost of 17.3 million primarily associated with assets held for sale within our fabrication division and lease assets and fixed assets within our ship or division [noise].
From a liquidity perspective, our position remains strong we ended the year with total cash investments and availability under our credit facility up almost 100 million. In addition.
Last week, we received 10 million in connection with the settlement of a change order dispute where previously completed project. This settlement was reached in February and is not reflected in our fourth quarter 2019 results.
Now, let me discuss our detailed fourth quarter results in quarterly comparisons.
Solid revenue for the fourth quarter, 2019, 79.4 million, but the net loss of 34.3 million or diluted loss per share of $2.26.
Compared to revenue for the third quarter, 2019, 75.8 million and a net loss of 6.8 million or diluted loss per share of 44 cents.
It's also compared to revenue for the fourth quarter, 2018, 60.2 million and a net loss of 4.7 million or diluted loss per share of 31 cents.
The increase in revenue for the quarter relative to the third quarter 2019 reflects an increase for our shipyard and services divisions.
Partially by a decrease for our fabrication division.
The increase in revenue relative to the same period of 2018 reflects an increase in activity for our shipyard and fabrication division.
With respect to our consolidated operating results increased loss compared to both the third quarter 2019, and fourth or 2018 was primarily due to the previously referenced project charges and noncash asset impairment nonrecurring items.
Now let me provide some additional details of our quarterly results by operating segment.
Fabrication Division revenue was 15.5 million for the quarter versus 19.5 million for the trailing period and 10.2 million for the comparable period of 2018.
Our operating loss for the quarter was 18.5 million compared to an operating loss of 848000 for the trailing period.
And operating income of 1.8 million for the same period of 28.
The decrease in revenue relative to the trailing quarter due to lower activity on our riverboat into 40 Big vehicle ferry projects.
The increase in revenue relative to the comparable period of 2018 was due to progress on a riverboat vehicle ferrying jacket that project.
With respect to operating results loss for the fourth quarter 2019 was primarily due to the project charges of 8.7 million and noncash impairments of 8.79, the project charges relate to our riverboat offshore jacket index and 40 vehicle Perry.
Vehicle very projects.
Impairments relate primarily to our three large crawler cranes and to play any role machines that are held for sale and our panel line equipment and deck barge that were placed back in service during the fourth quarter 2019.
The impairments to the assets held for sale were based on our current estimates at fair value and our desire for a shortened future marketing period.
The increase in operating loss for the current quarter relative to the trailing quarter and the loss relative to income for the same period of 2018 was primarily due to the previously mentioned charges and asset impairments.
For our shipyard Division revenue was 45.6 million for the quarter versus 39.4 million for the trailing period and 29.7 million for the comparable period of 2018.
Operating loss for the quarter was 13.5 million compared to an operating loss of 3.3 million for the trailing period 6.6 million for the same period of 2018.
The increase in rather revenue relative to both the trailing quarter and the comparable period of 2018 was due to progress on our three research special projects and three towing salvage and rescue ship projects offset partially by lower revenue for our Harbortouch and icebreaker type projects.
With respect to operating results the loss for the fourth foreigner 2019, but due to project charges of 5.1 million and non cash impairments of 7.6 million.
The project charges relate to our Harbortouch research vessel towing salvage and rescue ship icebreaker type projects.
Impairments relate primarily to lease assets and fixed assets associated with our Lake Charles facility and Jennings facility. The latter which is expected to be closed in the third quarter 2020 upon completion of the harbor tug projects.
The leased assets and non movable assets in the Ginnies facility, we're fully impaired and our fixed assets in Lake Charles which is primarily relate to dry docks in cranes were partially impaired based on current estimates of their fair value.
The increase in operating loss for the current quarter relative to both the trailing quarter and the same period of 2018.
Primarily due to the previously mentioned project charges and asset impairments.
For our services Division revenue was 20.5 million the quarter versus 17.5 million for the trailing period.
21.5 million for the comparable period of 2018.
Operating income for the quarter was 719000 compared to an operating loss of 407000 for the trailing period and operating income of 2.1 million for the same period of 2018.
Increase in revenue relative to the trailing quarter was due to higher fabricated products and offshore services activity.
The decrease relative to the comparable period of 2018 was due to lower offshore services revenue offset partially by higher onshore maintenance activity.
With respect to operating results income for the fourth quarter 2019 was impacted by project charge of 231000 break completed sub sea components project and noncash impairments of 282000.
Operating income for the current quarter relative to last for the trailing pure drilling quarter was due to the prior period included any project charge of one and a half million related to the previously mentioned completed sub sea components project.
The decrease in operating income in the current quarter compared to the same period of 2018 was due to the current period project charge asset impairments and a lower margin mix of work.
Our corporate division operating loss for the quarter was 3.1 million compared to an operating loss of 2.3 million for the trailing period and 1.9 million for the same period of 2018.
The increase in operating loss relative to the trailing period was due to higher legal fees associated with customer dispute and nonrecurring costs associated with the retirement of our former CEO.
Higher operating loss for the current quarter compared to the same period of 2018 was due to initiatives to enhance our business.
Higher legal fees associated with customer disputes as the costs were reflected within our operating divisions in 2018 and the nonrecurring costs.
Offset partially by lower incentive plan and board of director's compensation costs.
Now let me provide a few comments regarding our you're in backlog and liquidity.
With respect to backlog at December 2019, our backlog totaled approximately 437 million representing a decrease of 25 million from September 2019, and an increase of 81 million from year end 2018, with a year over year increase due to project awards for our shipyard decision attributable to our third research vessel project.
And second and third towing salvage and rescue ship projects there were awarded earlier in 2019.
Our yearend backlog by operating segment was 374 million for our shipyard Division 50 million for our fabrication Division and 13 million for our services Division.
This backlog excludes customer options on contracts for the U.S. Navy, which if exercised would increase our backlog by an additional 333 million.
With respect to liquidity, we ended the year with cash and short term investments of 69.6 million and in February of this year, we amended our credit facility. So just our financial covenants and maintain our facility maturity date of June 2021.
At December 31, 2019, we were in compliance with all of our amended financial covenants and had a 10.2 million of outstanding letters of credit with no borrowing borrowings on our credit facility, providing 29.8 million of availability for additional letters of credit or Barnes.
This current liquidity excludes any additional proceeds from the sale of assets totaling 9 million remained held for sale at year end of which 1.1 million was sold in February 2020.
In addition, as previously mentioned this liquidity excludes 10 million that was received in February 2020 from the settlement or change order dispute.
As we look ahead to 2020 I'd like to fried our expectations regarding working capital capital investment requirements.
At December 31, 2019, our working capital, excluding cash and assets held for sale approximated negative 13 million, primarily due to our contract liability position on projects associated with advanced billings and our crude contract losses.
This compares to 5.7 million positive working capital on the same basis at December 31 2018.
During 2020, we anticipate ongoing vary quarterly variability in our working capital requirements.
Including getting back to working capital levels that approximate our working capital as of the beginning of 2019.
In addition, we anticipate capital requirements in 2020 of approximately 10 million to 15 million of which approximately eight to 9 million represents capital investments required by our contracts for the U.S. Navy and the remainder represents what I would characterize is ongoing or maintenance capital expenditures.
The capital investments associated with the Navy contract relate to the construction of vessel erection sites and a warehouse that will also benefit our our other construction operations going forward.
With respect to expectations regarding EBITDA for 2020 at this time, we do not intend to provide guidance until we work through our current transition.
I'll now turn the call back over to Richard discuss our projects.
Thanks Wes.
Let me not provide some context to the project charges, we incurred in the quarter.
These projects, which were bit at least a year and a half ago as the company attempted to reposition away from our traditional reliance on the fabrication of structures and marine vessels, the sodas associated with the offshore oil and gas sector.
This repositioning occurred during a competitive market in which the company bid work at low margins, including breakeven to secure backlog to reduce the under utilization of resources and gain traction in the new markets being pursued in addition, certain divisions were transitioning the workforce to the fabrication of new and buried structures.
All of this was done during a very competitive labor market due in part to a significant decrease in the quality and availability of craft labor as many left industry as a result of the cyclicality of the market an all time low unemployment.
The cumulative effect of these factors among others I will discuss contribute to the project challenges that the company has recently experience, including those that manifested in the fourth quarter of 2020.
So with that as a backdrop.
With respect to our fabrication division the impact for our riverboat project totaled 2.1 million for the quarter and was related to increased craft labor.
Due to difficulties encounters and commissioning the vessel and the need to accelerate our schedule. These issues were largely due to the execution team under estimating the time and the complexity required to finish the vessel recognizing these challenges during the fourth quarter, we immediately assign shipyard supervision with expertise in finishing.
And commissioning to oversee the completion of the vessel and I'm happy to report that we received their certification of inspection and the vessel has been turned over to decline as of Monday. This week.
The impact for the 240 vehicle ferry projects totaled 5.1 million for the quarter and was related to increase craft labor subcontracted services and materials costs due to greater than anticipated rework lower than anticipated productivity experienced during the fourth quarter.
And our expectations of future labor productivity based on the recent experience and experience on similar recently completed projects.
Going forward I have a sign project execution responsibility for the vessels to our shipyard division to better align the supervision and construction as these vessels, but the capabilities and expertise of our shipyard division.
The impacts for offshore jacket, and Duck project totaled 1.5 million for the quarter.
And was related to increased forecast costs and liquidated damages due to higher cost estimates from our commissioning subcontractors and delays associated with customer related directives.
We are pursuing a change order to extend the schedule for the for the determination that liquidated damages as we believe the schedule impacts are the result of customer directives. However, the customer is disputing the change orders and accordingly, our forecast does not button.
Does not reflect the potential benefits if any.
Any favorable resolution of the change orders.
Now shifting to the shipyard division the impact for the Harbortouch projects totaled 1.7 million for the quarter and was related to increased craft labor cost and forecast liquidated damages due to the higher than anticipated costs on the self perform pain scope that we assumed the third quarter from an underperforming pain.
Subcontractor and lower productivity on other work scopes compared to previously can pet completed vessels.
Our current forecast for the remaining vessels reflect actual results realized on the seventh vessel, which was completed in February and anticipated potential future productivity impacts due to our announced closure the Jennings facility.
The impact for the research vessel projects totaled 2.5 million for the quarter and was due to the reversal of cumulative gross profits recognized during the fourth quarter of 2019, the impact for the full year inclusive of profit recognized during the first three quarters of 2019 totaled 800000.
The projects have experienced difficulties with subcontracted production engineering due in part to vessel size constraints and complexities associated with vessel functionality, which has resulted in an incomplete and deficient production engineering and construction delays disruption and re work.
As a result, we made a collective decision with our customer to delay construction activities on the project until production engineering achieves a satisfactory levels of completion to limit further impacts on construction. In addition, we have agreed to a change order that includes the customer taking responsibility for the production engineering.
The change order also includes the extensions of the schedule dates for the projects and provides for increases in contract price to account for the estimated cost impacts of the production engineering and construction delays.
Based on our current forecast cost to complete the projects the change order and the collaborative nature of our discussions with the customer we're not forecasting losses on these projects.
However, due to the uncertainties with respect to the timing of the completion of production engineering and the potential impacts on our construction schedules and costs as well as ongoing discussions with the customer we are unable to reasonably estimate the amount of gross profit if any that will ultimately be realized on the projects.
Accordingly during the fourth quarter, we reversed all previously recognized gross profits on the projects and tend to only recognize revenue equal to cost until we are able to reasonably estimate the amount of gross profit if any.
The impacts for the towing salvage and rescue ship projects totaled 700000.
And were related to increased craft labor subcontracted services and material costs, including revised estimates of specific contingency requirements for such items.
These projects during the quarter, an underlying cost forecast reflect what I believe to be a realistic approach to evaluate our contract positions and represents our best estimates of the cost to complete these projects.
With that.
Dan Please open the line for questions.
The question answer session will be conducted electronically if you would like to ask your question. Please do so bice pressing the star Keith followed by the digit one on your Touchtone telephone. If you are using the speakerphone. Please make sure. Your mute function is turned off to allow your signal to reach our equipment. We will proceed in the order that you signals and we'll take as many questions as time permits.
I can start want to ask question.
Once again, if you have a question you get.
Signal us by pressing star wants to keep up like yourself in the Q.
And well take our first question from Martin Malloy with Johnson Rice. Please go ahead.
Good afternoon.
Good afternoon Marty.
Hi.
Wanted to try to get your.
Sense in terms of outlook here.
According to my financial model you all have not Gulf Island is not generate positive EBITDA since 2016 then.
A lot of the difficulties.
It's a similar theme or underestimating the complexities projects increased labor costs in dispute with customers and change orders.
Can you give us an outlook in terms of now that you're ramping up on these research vessels in the Navy vessels.
When you expect to turn EBITDA positive.
Yeah, Marty obviously, it's a valid question at this point given the transition and what we're all we're going through it we're not prepared prepared to drive that one thing I will tell you is in light of the on project impacts about 85% of our backlog as it stands today.
It is break will contribute no future gross profit so where our contributions to profit will come from is our new project Awards and that's really going after me that that is the focus in terms of executing the backlog to the the estimates as we haven't today and then selling profitable.
New work on that is appropriately risk adjusted.
Contribute to.
Being EBITDA positive at some point.
Do you have anything else you want to add to that Richard No I think west is right.
We do have the backlog that as we discussed today.
We were we've got a realistic view on on the forecast and so it's a matter of excuse executing that backlog to our forecast ER and you know replenishing the backlog with new prospects that as we discussed earlier in my talk that we're going to be very disciplined.
The a rigorous and how we bid, but these opportunities and add to our backlog.
Okay, and then you're talking about these new opportunities you mentioned in the press release you discussed.
Fabrication modules piping systems other structures for onshore refining petrochemical LNG.
Yes, it seems like that's a pretty competitive area and you're seeing lower cost yards internationally, becoming more and more capable there's more heavy lift vessels out there to move the modules.
Why do you think you'd have a competitive advantage and going after this work.
That's that's a great.
A question Marty.
We're not going to compete with the the yards that our offshore for example in China, we the complexity and the scope and size.
It is we're just now that's not target market that we're going to compete after we're really going to focus on really utilizing our strategic asset more specifically the location the waterway access and and target the the projects that I and the customers in Texas and Louise.
And that that are in a value the.
Strategic location. So we're looking at things that are potentially a time sensitive or a sub modules that where for example pipe rack modules, where theres just a lot of space on the module. So it's not I dense compacted module and its customers don't want to ship those types of.
Modules overseas, so pipe rack modules very specific targeted process modules. Those are the ones that we're going to go after and and again, we're not going to be ever everything to everybody, we're going to be very methodical and focused on how we go after strategic customers to strategic projects.
Okay. Thank you.
Our next question acute comes from Jeff do you get with global value Investment Corp. Please go ahead.
Good afternoon. Thank you for your comments and Richard welcome aboard you've stepped into a challenging situation.
Thanks JP.
Question for you in your press release you stay.
You will see using more disciplined approach to pursuing project opportunities with increased figure around your bidding estimates.
[laughter].
How would you describe what will be different in the future versus that process in the past.
So one of some simply put one of things that we're doing is we've implemented a bid estimate reviews. So a prospect review and we call it.
A go no go no go review it so it's a bit review or where are we sit and and evaluate the prospects from a you know is the prospect been funded so what's the opportunity in terms of the competitive.
Landscapes do we have a value proposition, what's our winning advantage and so what we're doing the stage gate process, where that that opportunity will go through multiple iterations in our review. So that's the first part and then when the when when the process prospect gets further developed we're going to do is developing next year.
Action plan associated with that prospect and review all the risks associated in that execution plan you know how as how we see the the project being executed and we'll evaluate all the risk instant and ask ourselves. These tough questions. You know how are you gonna managed the risk are we going to address the risk and is the.
And the risk be properly addressed or can it be funded and our contract price so that rigor that discipline and again. This methodical approach of let's we understand what we do it's a tough competitive market, but but making sure that are our employees.
I understand the execution plan and how we're going to deliver this this project to the estimates that we develop and essentially.
Supposed to decline.
Alright, that's great and I believe during your prepared comments you mentioned that in fact, you have had conversation with prospective customers.
And have had pushed back or you've given them pushback.
Yes, how they responded to that.
That's a that's a great question no Gulf Island got a great history I'll tell Ya.
That.
That my experience with golf on is there really good good people and they don't know how to say no. It's that maybe if that southern hospitality you know that they that they always say, yes, and it was really hard for my team members when when we gave or which I challenged the team the push back but for my team members to put.
Back, but ultimately when we do the customers come back with concessions because what we're pushing back with our are realistic its objective, it's rational and so.
If you asked my employees today, the ones that had been involved and not only the bidding process, but the execution processing and asking how well that's going they'll tell you know now to 10 times they'll come the customers are coming back and discussing with us about the future possibility.
[noise], great Yeah, Rich history, I hope you able to capitalize on here best of luck too.
Thank you JP.
Our next question acute comes from John Dicer with Pinnacle. Please go ahead.
Hi, Good afternoon, Richard welcome.
I was just curious you mentioned process and procedures, which I think are absolutely critical going forward.
Where are we with getting those two where you want them to be.
Oh, we pretty far along are they in.
Are they complete at this point.
Where are we.
Well, it's been 100 days [laughter]. So so we are far along in that in a sense that we have implemented some some fundamental processes and procedures.
We do have opportunities to further hone and as as we look for you know again to improve our our people side of the equation and continue to.
Look for opportunities where where.
We're looking to leverage our asset better, but but more importantly, bringing in the.
The functional teams and our organization to two to adopt a standard standard process. That's what we're continuing to work toward.
I would say John that this is probably a continuous improvement type of concept where.
We're going to continue to hone in and adapt to the market and in the business.
Okay.
You mentioned people do you feel you have the right people and the rights slots at this point in terms of project managers are bidding people is is that where you wanted to be as well.
Yeah. So that's good great question, we just recently hired.
A new head of HR, that's obviously going to help me or and this department, but we do have fundamentally.
The right backbone, but we have to supplement our team can again continuously we got to always look for the best talent.
Some of the things that we're looking at.
Beefing up or or or or adding to.
And I think we talked about at some and in our press release, but but is around if we're going to go. After this onshore module fabrication. What we really are looking to hire some business development professionals estimators project managers that have that experience and project controls professionals, but ultimately.
<unk> are going to help us execute these projects. So that there are some some functional roles and and roles at work key role that we're looking for and trying to supplement and add to our team.
Okay good to hear.
And finally, you're spending money on legal to resolve the disputes.
And you collect a 10 million a recently or was that 10 million related to one of the bigger disputes the horn back or the Walker or are those two bigger disputes still outstanding at this point.
John This is west it's the latter so we you're right we had been spending quite a bit on legal on on that offshore change order. That's the one that was resolved it it's not one back so hornbeck, we still have in front of us and we're going through the.
Through the litigation phases, now and that's the only significant litigation we have outstanding at this point.
Okay excellent good luck with that.
Thank you. Thank you.
Given there are no more questions. This concludes today's question and answer session. At this time I would like to turn the conference back over to Richard for any additional comments.
Thanks, Dan in summary, while our results over the past several years have been disappointing I believe the implementation of the previously mentioned initial actions focused on internal disciplined and strengthen processes and procedures and talent allocation.
Well provide improved project execution as we move forward.
Combined with our strong balance sheet liquidity continued capital build cycle in our onshore downstream end markets and marketing the strategic value of our location and assets in home on Louisiana, I'm confident we'll return to the company to profitability.
Thank you for your interest in Gulf Island.
Look forward to speak with you again in connection with our first quarter results.
Well it sounds like we have one more.
Question.
Jonathan If you have a question please re queue up by pressing star one.
We'll take our next question from Jonathan Lawrence with Dawson James Securities. Please go ahead.
I was just curious if there's any thought behind a share buyback.
Based upon the cash and on the balance sheet.
Good good question, Jonathan as we sit here today, we believe is strong balance sheet and liquidity are really paramount to giving our customers banner stakeholders confident.
As we grow the business and and and strive to to.
Return to profitability I promise you until you its something that we continue to evaluate as we evaluate our capital structure, but at this point in time, it's not in the cards.
Okay. Thank you.
And this concludes the Q and a session I will now I'll turn it back to richer for any additional comments.
Well that's it Dan I think we're finished.
Thank you ladies and gentlemen, this concludes the Gulf Island Conference call you may now disconnect.
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