Orion Wins $10M Myrtle Beach Deal

Zacks

Leading heavy civil marine contractor, Orion Marine Group Inc. (ORN), has received a contract worth $10 million from the City of Myrtle Beach, SC. The scope of the contract involves the installation of a storm water outfall system. This system will comprise approximately 1400 feet of dual 84" diameter concrete pipes and associated equipment. The contract is expected to be completed within a year, starting from the third quarter of fiscal 2014.

Orion has received orders worth approximately $117 million (including the current $10 million). This includes a contract  valued $68 million from the Port of Houston Authority and two orders received in Jan 2014 worth $19 million and $20 million, from a private Caribbean customer and a private client in the Gulf Coast region, respectively.

Orion is believed to have one of the most advanced dredging equipment in the industry. The company is one of the leading providers of a broad range of marine construction and contracting services. Some of the company’s main customers include the U.S. Marine Transportation System and the cruise industry.

In first-quarter 2014, the company reported net loss of 1 cent a share, narrower than the Zacks Consensus Estimate of a loss of 5 cents a share. However, during the quarter, contract revenues increased 8.3% to $81.3 million from $75.1 million in the prior-year quarter. The company expects to face underutilization of its dredging assets in the first half of the year, nevertheless, it expects demand from the private sector to drive equipment utilization and bid opportunities.

Orion currently has a Zacks Rank #3 (Hold). Some better-ranked stocks in the sector include Emcor Group Inc. (EME), Sterling Construction Co. Inc. (STRL) and Tutor Perini Corporation (TPC). All three carry a Zacks Rank #2 (Buy).

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