Exhibit 99.1
NEWS RELEASE                                             
                                                 
For further information contact:
Kirk J. Meche                                   
Chief Executive Officer & Interim Chief Financial Officer                        
713.714.6100                                   

FOR IMMEDIATE RELEASE
Thursday, October 27, 2016

GULF ISLAND FABRICATION, INC.
REPORTS THIRD QUARTER EARNINGS

Houston, TX - Gulf Island Fabrication, Inc. (NASDAQ: GIFI) today reported net income of $541,000 ($0.04 diluted earnings per share) on revenue of $65.4 million for its third quarter ended September 30, 2016, compared to a net loss of $(12.1) million ($(0.84) diluted earnings (loss) per share) on revenue of $67.5 million for the third quarter ended September 30, 2015. For the nine months ended September 30, 2016 and 2015, the Company reported net income of $7.1 million ($0.48 diluted earnings per share) on revenue of $230.9 million compared to a net loss of $(10.7) million ($(0.74) diluted earnings (loss) per share) on revenue of $251.1 million, respectively.

The Company had revenue backlog of $181.2 million and labor backlog of approximately 1.6 million hours at September 30, 2016, including commitments received through October 27, 2016, compared to revenue backlog of $157.5 million and labor backlog of 1.3 million hours reported as of June 30, 2016. We expect to recognize revenue from our backlog of approximately $71.8 million, $87.3 million million, and $22.1 million during the remainder of 2016, 2017, and 2018, respectively.

 
September 30, 2016 (1)
 
December 31, 2015
 
(in thousands)
 
 
 
 
Cash and cash equivalents
 
$
55,642

 
 
 
$
34,828

 
Total current assets
 
123,255

 
 
 
115,869

 
Property, plant and equipment, net
 
211,215

 
 
 
200,384

 
Total assets
 
337,212

 
 
 
316,923

 
Total current liabilities
 
43,483

 
 
 
37,901

 
Total shareholders’ equity
 
266,115

 
 
 
257,197

 
________________
(1) Amounts include assets and liabilities acquired in connection with the LEEVAC transaction.

Our balance sheet position remains stable with $55.6 million in cash, no debt, and working capital of $79.8 million. In addition, we have $75.5 million available under our credit facility for letters of credit and $20.0 million available for general corporate uses. We will continue to monitor and maintain a conservative capital structure as we navigate through the current oil and gas downturn.

During the fourth quarter, we expect to enter into a two-year $40.0 million amended and restated credit facility with our current lenders that will continue to be secured by substantially all of our assets (other than real property).  We anticipate the amended credit facility will allow us to use the full $40.0 million borrowing base for both letters of credit and general corporate purposes.  Given the historically low levels of borrowings under our current facility and our cash position, we requested a reduction in the amount of available credit under our revolver from $80.0 million to $40.0 million to decrease the commitment fees payable to our lenders for the undrawn portion of the facility.

“Our subsidiary, Gulf Island LLC, received a letter of intent for the fabrication of four modules associated with a U.S. ethane cracker project. We are excited to be a part of the petrochemical plant expansion projects as we continue to explore markets outside the Oil & Gas sector. This project will bring much needed job opportunities to our Louisiana fabrication division.” stated Kirk Meche President & CEO. Revenue and man hours have been incorporated in the backlog numbers contained within.





The management of Gulf Island Fabrication, Inc. will hold a conference call on Friday, October 28, 2016, 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, 2016. The call is accessible by webcast (www.gulfisland.com) through CCBN and by dialing 1.888.806.6208. A digital rebroadcast of the call is available two hours after the call and ending November 4, 2016 by dialing 1.888.203.1112, replay passcode: 325346.

Gulf Island Fabrication, Inc., based in Houston, Texas, with fabrication facilities located in Houma, Jennings and Lake Charles, Louisiana, and San Patricio County, Texas, 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 along with providing fabrication solutions to alternative energy providers. 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”, and “MinDOCs”), piles, wellhead protectors, subsea templates and various production, compressor and utility modules, offshore living quarters, foundations for offshore wind projects, 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, onshore and offshore scaffolding, piping insulation services, and steel warehousing and sales.


GULF ISLAND FABRICATION, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(in thousands, except per share data)

 
Three Months Ended
 
Nine Months Ended
 
 
September 30,
 
September 30,
 
June 30,
 
September 30,
 
September 30,
 
 
2016 (1)
 
2015
 
2016
 
2016 (1)
 
2015
 
Revenue (2)
$
65,384

 
$
67,531

 
$
81,502

 
$
230,864

 
$
251,102

 
Cost of revenue
60,125

 
75,368

 
67,436

 
205,839

 
248,686

 
Gross profit
5,259

 
(7,837
)
 
14,066

 
25,025

 
2,416

 
General and administrative expenses
5,086

 
3,798

 
5,062

 
14,633

 
11,817

 
Asset impairment
—

 
6,600

 
—

 
—

 
6,600

 
Operating income
173

 
(18,235
)
 
9,004

 
10,392

 
(16,001
)
 
Other income (expense):
 
 
 
 
 
 
 
 
 
 
Interest expense
(110
)
 
(39
)
 
(88
)
 
(248
)
 
(126
)
 
Interest income
12

 
8

 
2

 
20

 
21

 
Other income, net
599

 
—

 
42

 
1,039

 
20

 
 
501

 
(31
)
 
(44
)
 
811

 
(85
)
 
Income before income taxes
674

 
(18,266
)
 
8,960

 
11,203

 
(16,086
)
 
Income taxes
133

 
(6,129
)
 
3,420

 
4,134

 
(5,389
)
 
Net income
$
541

 
$
(12,137
)
 
$
5,540

 
$
7,069

 
$
(10,697
)
 
Per share data:
 
 
 
 
 
 
 
 
 
 
Basic and diluted earnings per share - common shareholders
$
0.04

 
$
(0.84
)
 
$
0.37

 
$
0.48

 
$
(0.74
)
 
Cash dividend declared per common share
$
0.01

 
$
0.10

 
$
0.01

 
$
0.03

 
$
0.30

 
________________
(1)
Results of operations for the three and nine months ended September 30, 2016 include the operations acquired in the LEEVAC transaction effective January 1, 2016. Revenues and net income for the three months ended September 30, 2016 attributable to LEEVAC were $16.8 million and $(471,000), respectively. Revenue and net income for the nine months ended September 30, 2016 attributable to LEEVAC were $55.9 million and $280,000, respectively.
(2)
Revenue for the three and nine months ended September 30, 2016 includes the recognition of $1.5 million and $4.1 million in non-cash amortization of deferred revenue related to the values assigned to contracts acquired in the LEEVAC transaction, respectively.





Operating Segments
Backlog (in thousands)
 
 
September 30, 2016
 
June 30, 2016
 
March 31, 2016
Segment
 
$'s
 
Labor hours
 
$'s
Labor hours
 
$'s
 
Labor hours
Fabrication (1)
 
$
84,940

 
841

 
$
41,126

431

 
$
48,828

 
524

Shipyards
 
78,886

 
582

 
93,912

629

 
119,984

 
843

Services
 
17,386

 
163

 
22,540

209

 
28,316

 
308

Intersegment Eliminations
 
—

 
—

 
(41
)
—

 
(60
)
 
—

Total Backlog
 
$
181,212

 
1,586

 
$
157,537

1,269

 
$
197,068

 
1,675

 
 
 
 
 
 
 
 
 
 
 
 
Results of Operations (in thousands, except percentages)
Fabrication
 
Three Months Ended 
 September 30,
 
 
2016
 
2015
Revenue
 
$
22,311

 
$
32,133

Gross profit (loss)
 
532

 
(14,009
)
Gross profit percentage
 
2.4
%
 
(43.6
)%
General and administrative expenses
 
1,481

 
2,138

Asset impairment
 
—

 
6,600

Operating income (loss)
 
(949
)
 
(22,747
)
 
 
 
 
 
Shipyards (2)
 
Three Months Ended 
 September 30,
 
 
2016
 
2015
Revenue (3)
 
$
23,060

 
$
12,936

Gross profit (3)
 
1,877

 
1,937

Gross profit percentage
 
8.1
%
 
15.0
%
General and administrative expenses
 
2,065

 
392

Operating income (loss)(2)
 
(188
)
 
1,545

 
 
 
 
 
Services
 
Three Months Ended 
 September 30,
 
 
2016
 
2015
Revenue
 
$
20,928

 
$
23,487

Gross profit
 
2,850

 
4,235

Gross profit percentage
 
13.6
%
 
18.0
%
General and administrative expenses
 
1,540

 
994

Operating income
 
1,310

 
3,241

 
 
 
 
 
____________
(1)
Includes commitments received through October 27, 2016.

(2)
Included in our results of operations for our Shipyards segment were revenue and net income (loss) of $16.8 million and $(471,000) attributable to the operations acquired in the LEEVAC transaction for the three months ended September 30, 2016.





(3)
Revenue for the three months ended September 30, 2016 includes the recognition of $1.5 million in non-cash amortization of deferred revenue related to the values assigned to contracts acquired in the LEEVAC transaction.
 

GULF ISLAND FABRICATION, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)

 
Nine Months Ended September 30,
 
2016
 
2015
 
(in thousands)
Cash flows from operating activities:
 
 
 
Net income (loss)
$
7,069

 
$
(10,697
)
Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Bad debt expense
422

 
400

Depreciation
19,262

 
19,674

Amortization of deferred revenue
(4,114
)
 
—

Asset impairment
—

 
6,600

Gain on sale of assets
(924
)
 
(10
)
Deferred income taxes
3,651

 
(5,464
)
Compensation expense - restricted stock
2,452

 
1,863

Changes in operating assets and liabilities:
 
 
 
Contracts receivable and retainage
22,287

 
43,501

Costs and estimated earnings in excess of billings on uncompleted contracts
(5,834
)
 
(237
)
Prepaid expenses and other assets
915

 
2,072

Inventory
135

 
508

Accounts payable
(13,654
)
 
(25,402
)
Billings in excess of costs and estimated earnings on uncompleted contracts
(20
)
 
(13,494
)
Deferred revenue
(8,928
)
 
—

Accrued employee costs
1,404

 
343

Accrued expenses
2,733

 
(2,369
)
Accrued contract losses
(8,001
)
 
1,367

Current income taxes
413

 
—

Net cash provided by operating activities
19,268

 
18,655

Cash flows from investing activities:
 
 
 
Capital expenditures
(5,415
)
 
(5,052
)
Net cash received in acquisition
1,588

 
—

Proceeds on the sale of equipment
5,813

 
10

Net cash provided by (used in) investing activities
1,986

 
(5,042
)
Cash flows from financing activities:
 
 
 
Payments of dividends on common stock
(440
)
 
(4,397
)
Net cash used in financing activities
(440
)
 
(4,397
)
Net change in cash and cash equivalents
20,814

 
9,216

Cash and cash equivalents at beginning of period
34,828

 
36,085

Cash and cash equivalents at end of period
$
55,642

 
$
45,301