Gulf Island Fabrication, Inc. Reports Third Quarter Earnings

HOUMA, La.--(BUSINESS WIRE)-- Gulf Island Fabrication, Inc. (NASDAQ: GIFI) today reported net income of $3.5 million ($.24 diluted EPS) on revenue of $60.7 million for its third quarter ended September 30, 2010, compared to net income of $6.0 million ($.41 diluted EPS) on revenue of $76.6 million for the third quarter ended September 30, 2009. Net income for the nine months ended September 30, 2010 was $11.4 million ($.79 diluted EPS) on revenue of $205.3 million, compared to the net income of $16.2 million ($1.12 diluted EPS) on revenue of $240.8 million for the nine months ended September 30, 2009.

The company had a revenue backlog of $140.3 million and a labor backlog of approximately 1.4 million man-hours remaining to work, which consists of work remaining at September 30, 2010 and commitments received through October 28, 2010. Our backlog as of September 30, 2010 does not include any amounts associated with a Letter of Authorization on a deepwater Gulf of Mexico project we received and announced on September 20, 2010.

SELECTED BALANCE SHEET INFORMATION

(in thousands)

                                                    September 30,  December 31,

                                                    2010           2009

Cash, cash equivalents and short-term investments   $ 35,696       $ 8,751

Total current assets                                  118,200        112,874

Property, plant and equipment, at cost, net           197,429        200,459

Total assets                                          343,661        332,175

Total current liabilities                             31,602         32,373

Debt                                                  0              0

Shareholders' equity                                  285,404        273,801

Total liabilities and shareholders' equity            343,661        332,175

The management of Gulf Island Fabrication, Inc. will hold a conference call on Friday, October 29, 2010 at 9:00 a.m. Central Time (10:00 a.m. Eastern Time) to discuss the Company's financial results for the quarter ended September 30, 2010. The call is accessible by webcast (www.gulfisland.com) through CCBN and by dialing 1.888.239.5289. A digital rebroadcast of the call is available two hours after the call and ending November 5, 2010 by dialing 1.888.203.1112, replay passcode: 1142194.

Gulf Island Fabrication, Inc., based in Houma, Louisiana, is a leading fabricator of offshore drilling and production platforms, hull and/or deck sections of floating production platforms and other specialized structures used in the development and production of offshore oil and gas reserves. These structures include jackets and deck sections of fixed production platforms; hull and/or deck sections of floating production platforms (such as tension leg platforms ("TLPs")), "SPARs", "FPSOs", "MinDOCs", piles, wellhead protectors, subsea templates and various production, compressor and utility modules, offshore living quarters, towboats, liftboats, tanks and barges. The Company also provides offshore interconnect pipe hook-up, inshore marine construction, manufacture and repair of pressure vessels, heavy lifts such as ship integration and TLP module integration, loading and offloading of jack-up drilling rigs, semi-submersible drilling rigs, TLPs , SPARs, or other similar cargo, onshore and offshore scaffolding, piping insulation services, and steel warehousing and sales.

GULF ISLAND FABRICATION, INC.

CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

(in thousands, except per share data)

                                Three Months Ended      Nine Months Ended

                                September 30,           September 30,

                                2010        2009        2010         2009

Revenue                         $ 60,733    $ 76,631    $ 205,282    $ 240,763

Cost of revenue                   53,798      65,413      184,174      209,448

Gross profit                      6,935       11,218      21,108       31,315

General and administrative        1,997       2,051       6,084        6,247
expenses

Operating income                  4,938       9,167       15,024       25,068

Other income (expense):

Interest expense                  (19    )    (23    )    (57     )    (58     )

Interest income                   1,044       81          2,363        101

Other                             23          2           1,054        4

                                  1,048       60          3,360        47

Income before income taxes        5,986       9,227       18,384       25,115

Income taxes                      2,524       3,241       6,985        8,916

Net income                      $ 3,462     $ 5,986     $ 11,399     $ 16,199

Per share data:

Basic earnings per share -      $ 0.24      $ 0.41      $ 0.79       $ 1.12
common shareholders

Diluted earnings per share -    $ 0.24      $ 0.41      $ 0.79       $ 1.12
common shareholders

Weighted-average shares           14,318      14,293      14,316       14,293

Effect of dilutive
securities: employee stock        2           2           9            2
options

Adjusted weighted-average         14,320      14,295      14,325       14,295
shares

Depreciation and amortization   $ 4,797     $ 4,667     $ 14,412     $ 13,764
included in expense above

Cash dividend declared per      $ 0.01      $ 0.01      $ 0.03       $ 0.12
common share

    Source: Gulf Island Fabrication, Inc.

Released October 28, 2010