NEWS RELEASE EXHIBIT 99.2 For further information contact: Kerry J. Chauvin Joseph "Duke" Gallagher Chief Executive Officer Chief Financial Officer (985) 872-2100 (985) 872-2100 - -------------------------------------------------------------------------------- FOR IMMEDIATE RELEASE WEDNESDAY, OCTOBER 23, 2002 GULF ISLAND FABRICATION, INC. REPORTS THIRD QUARTER EARNINGS Houma, LA - Gulf Island Fabrication, Inc. (NASDAQ: GIFI) today reported net income of $3.8 million ($.32 diluted EPS) on revenue of $40.3 million for its third quarter ended September 30, 2002, compared to net income of $2.2 million ($.18 diluted EPS) on revenue of $30.5 million for the third quarter ended September 30, 2001. Net income for the first nine months of 2002 was $6.9 million ($.59 diluted EPS), before a cumulative effect of change in accounting principle, on revenue of $100.6 million, compared to net income of $6.0 million ($.51 diluted EPS) on revenue of $92.3 million for the first nine months of 2001. Effective January 1, 2002 the Company adopted Statement of Financial Accounting Standards Board No. 142, ("SFAS No. 142"), "Goodwill and Other Intangibles Assets", which resulted in a $4.8 million non-cash charge for the impairment of goodwill, which was recorded as a cumulative effect of change in accounting principle. The recording of this non-cash charge for the impairment of goodwill resulted in net earnings of $2.2 million ($.18 diluted EPS) for the nine months ended September 30, 2002. At September 30, 2002, the company had a revenue backlog of $60.5 million and a labor backlog of approximately 920 thousand man-hours remaining to work. SELECTED BALANCE SHEET INFORMATION (in thousands)
September 30, December 31, 2002 2001 ------------- ------------ Cash and short-term investments $ 35,031 $ 35,032 Total current assets 71,309 55,461 Property, plant and equipment, at cost, net 47,108 41,666 Total assets 119,062 102,538 Total current liabilities 22,445 8,860 Debt 0 0 Shareholders' equity(a) 91,576 88,905 Total liabilities and shareholders' equity 119,062 102,538
Gulf Island Fabrication, Inc., based in Houma, Louisiana, is a leading fabricator of offshore drilling and production platforms, offshore living quarters and other specialized structures used in the development and production of offshore oil and gas reserves. The Company also offers offshore interconnect pipe hook-up, inshore marine construction, manufacture and repair of pressure vessels, and steel warehousing and sales. (a) Reference to Footnote 1 shown on page 2 (Consolidated Statements of Income). EXHIBIT 99.2 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, ------------------------- ------------------------- 2002 2001 2002 2001 ---------- ---------- ---------- ---------- Revenue $ 40,255 $ 30,496 $ 100,554 $ 92,321 Cost of revenue 33,483 25,826 87,504 79,731 ---------- ---------- ---------- ---------- Gross profit 6,772 4,670 13,050 12,590 General and administrative expenses 1,103 1,051 3,029 3,394 ---------- ---------- ---------- ---------- Operating income 5,669 3,619 10,021 9,196 Other income (expense): Interest expense (14) (9) (32) (27) Interest income 151 295 479 874 Other 1 (628) 58 (737) ---------- ---------- ---------- ---------- 138 (342) 505 110 ---------- ---------- ---------- ---------- Income before income taxes 5,807 3,277 10,526 9,306 Income taxes 1,974 1,120 3,579 3,291 ---------- ---------- ---------- ---------- Net income before cumulative effect of change in accounting principle 3,833 2,157 6,947 6,015 Cumulative effect of change in accounting principle(1) -- -- (4,765) -- ---------- ---------- ---------- ---------- Net income (loss) $ 3,833 $ 2,157 $ 2,182 $ 6,015 ========== ========== ========== ========== Per share data: Basic earnings (loss) per share:(4) Net income before cumulative effect of change in accounting principle $ 0.33 $ 0.18 $ 0.59 $ 0.51 ========== ========== ========== ========== Cumulative effect of change in accounting principle(1) $ -- $ -- $ (0.41) $ -- ========== ========== ========== ========== Basic earnings (loss) per share $ 0.33 $ 0.18 $ 0.19 $ 0.51 ========== ========== ========== ========== Diluted income (loss) per share:(2)(4) Net income before cumulative effect of change in accounting principle $ 0.32 $ 0.18 $ 0.59 $ 0.51 ========== ========== ========== ========== Cumulative effect of change in accounting principle(1) $ -- $ -- $ (0.40) $ -- ========== ========== ========== ========== Diluted earnings (loss) per share $ 0.32 $ 0.18 $ 0.18 $ 0.51 ========== ========== ========== ========== Weighted-average shares 11,744 11,706 11,727 11,702 Effect of dilutive securities: employee stock options 71 52 87 100 ---------- ---------- ---------- ---------- Adjusted weighted-average shares(2) 11,815 11,758 11,814 11,802 ========== ========== ========== ========== Depreciation and amortization included in expense above(3) $ 1,150 $ 1,222 $ 3,439 $ 3,627 ========== ========== ========== ==========
(1) The Company recorded a $4.8 million non-cash charge for the impairment of goodwill resulting from the adoption of Statement of Financial Accounting Standards Board No. 142, "Goodwill and Other Intangible Assets". (2) The calculation of diluted earnings per share assumes that all stock options are exercised and that the assumed proceeds are used to purchase shares at the average market price for the period. (3) Amortization of $108,000 and $325,000 included in the three months and nine months ended September 30, 2001, respectively. (4) For the nine months ended September 30, 2002, the calculation of earnings per share for net income before cumulative effect of change in accounting principle and cumulative effect of change in accounting principle do not total due to rounding.