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Politics : High Tolerance Plasticity -- Ignore unavailable to you. Want to Upgrade?

To: chowder who wrote (1759)	3/16/2001 2:04:32 PM
From: Wowzer	Respond to of 23153

UFAB reminds me of the old TCMS, always been a dog, never moves with the rest of the group. Plus Sarge used to like it, need I say more

To: chowder who wrote (1759)	3/16/2001 2:22:14 PM
From: excardog	Respond to of 23153

did you read this? ``I have been through many down cycles in the energy industry,'' said Dailey Berard, UNIFAB International, Inc., president, CEO and Chairman of the Board, ``but I have never experienced one which confounded conventional thinking as much as this one has. We experienced an uptick in contract awards a year ago and with the prices of oil and gas at that time we expected the recovery cycle to begin in the second half of 2000. We underestimated the lack of confidence and the stability of oil and gas prices, the effect that the mergers among the major oil companies had on capital spending, and the need for our customers to repair their balance sheets, which were damaged by low commodity price levels in 1998 and 1999. ``For over a year, we have been working with backlog levels that have been less than three months revenue. During that period, pricing for fabrication services suffered, as competition for the few projects available was fierce. Our financial results in the quarter and nine-month period ended December 31, 2000 reflect this pricing. In addition, loss reserves of $4.2 million, mainly on two fixed price contracts and a first of a kind lift boat, were recorded in the December quarter. These loss reserves were the result of the poor pricing environment in early 2000, when those contracts were awarded, and reduced productivity in the yards as worked slowed during the December quarter due to poor weather conditions and low level of work backlog at that date. Our backlog began to grow in late December and by December 31, 2000 reached $27 million, our highest level of backlog since the beginning of 1999. Since December, we have added over $20 million to that backlog. The turn around we expected in the second half of 2000 appears to be materializing now, nine months later.'' ``We aggressively grew the Company throughout the downturn through acquisitions and development of new fabrication capacity. However, our operating results have had an impact on our financial strategy, and we have been unable to maintain compliance with the financial covenants in our credit facility. We are in discussions with our bank group to waive these covenant defaults for December 31, 2000 and we expect to be able to obtain that waiver. With the dramatic increase in backlog, we are pursuing financing alternatives to reduce our reliance on conventional bank financing, improve our liquidity, and establish a capital structure which will allow us to take advantage of the production capabilities we have assembled.'' ``I believe we are on the verge of realizing the benefits of the Company we have built over the last three years. With the economic environment in the construction and fabrication end of the oil and gas industry improving and with our full capacity in place and in demand, we are optimistic about our prospects for 2001 and excited about the outlook beyond.''