While oil prices have hovered near six-year lows for the majority of 2015, ENGlobal Corporation (NASDAQ: ENG) has continued to leverage the considerable industry experience of its management team to promote strong financial results. Last week, the company demonstrated the versatility and marketability of its offerings when it announced that the second quarter of 2015 marked its sixth consecutive quarter of profitability.
“We are pleased to report today’s profitable results – which I’m proud to say represent six consecutive profitable quarters,” Mark Hess, chief financial officer of ENGlobal, stated in a news release. “ENGlobal’s profit margins remain respectable given the current environment, and our available capital has improved over the last year.”
In an effort to counteract the effects of slumping oil and gas prices, ENGlobal’s management expertly adjusted the margins of its engineering and construction operations in the second quarter. In addition to decreasing gross profit margin by 2.5 percent, as compared to the previous year, the company’s operating profit margin was reduced by 0.6 percent. These adjustments allowed ENGlobal to remain competitive in less-than-ideal market conditions, effectively promoting growth despite substantial industry limitations.
Following the release of its financial results for the second quarter, this strategy proved to be effective. For the period, ENGlobal achieved a mild year-over-year increase in total revenue for its engineering and construction segment, which serves a collection of energy sectors adversely affected by the recent fall in commodity prices. In an effort to capitalize on this progress, the company has recently turned its attention toward broadening its industry presence through the development of new partnerships and the exploration of potential acquisition candidates.
“ENGlobal’s response to the current energy marketplace has been to increase our efforts in developing new business,” stated William Coskey, P.E., chairman and chief executive officer of ENGlobal. “While we are excited about several new opportunities and client relationships that this internal process has produced, it also appears to be a great time to consider strategic acquisitions.”
According to the its latest financial report, the company has a healthy cash balance and working capital of approximately $25.4 million. Additionally, ENGlobal reports no borrowings under its current credit facility. The flexibility provided by this strong balance sheet will prove instrumental to the company’s growth efforts moving forward, particularly as related to any acquisition agreements that may be in the cards.
For prospective shareholders, ENGlobal’s financial performance despite slumping commodity prices is a promising indication of its market potential in the coming months. Look for the company to continue relying on the considerable expertise of its leadership team – which includes well over a century of combined industry experience – in order to continue successfully navigating prevailing market conditions and promoting sustained profitability for the foreseeable future.
For more information, visit www.englobal.com