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View All NewsWorld – Q4 impairment charges send CDI into loss
US-based engineering and technology services firm CDI Corp (CDI: NYSE) yesterday reported revenue of USD 266.7 million for the fourth quarter ending 31 December 2014, a decrease of 3.8% from USD 277.1 million during the same period last year.
Q4 2014 | Q4 2013 | Change | |
Revenue | USD 266.7 million | USD 277.1 million | -3.8% |
Gross Profit | USD 48.5 million | USD 52.2 million | -7.2% |
Operating Income (loss) | (USD 14.8 million) | USD 3.8 million | N/A |
In the fourth quarter 2014, the company recorded USD 14.7 million of impairment charges related to certain businesses within the Global Engineering and Technology Solutions segment. This amount included charges to goodwill in the infrastructure business and, to intangibles and other assets in the data acquisition and analysis systems business. The company also reported an aggregate pre-tax charge of USD 3.6 million due to the previously announced restructuring.
On an annual basis, the company achieved revenue growth of 3.2% to USD 1.12 billion, up from USD 1.09 billion in 2013.
FY 2014 | FY 2013 | Change | |
Revenue | USD 1,123.0 million | USD 1,087.9 million | +3.2% |
Gross Profit | USD 206.6 million | USD 206.6 million | 0.0% |
Operating Income | USD 5.4 million | USD 20.9 million | -74.2% |
Scott J. Freidheim, The fourth quarter represents the beginning of the transformation of the CDI platform. We are executing with a sense of urgency the cultural, operational, and strategic initiatives to create value for our clients and shareholders.”
CDI Corp operates across the Americas, EMEA, and APAC, but provides no geographical breakdown of their financial results. In the UK, the company operates under the brand CDI Anders Elite.
CDI Corp provides Global Engineering & Technology Solutions (GETS) and Professional Services Staffing (PSS). Each division derives revenue from Oil, Gas, & Chemical (OGC), Aerospace & Industrial Equipment (AIE), Hi-Tech, and Other.
Revenue from GETS and PPS during the fourth quarter of last year, compared with the same quarter in 2013, was as follows:
(USD) | GETS | PPS | ||||
(Millions) | Q4 2014 | Q4 2013 | Change | Q4 2014 | Q4 2013 | Change |
OGC | 35.3 | 31.0 | +13.8% | 43.4 | 42.9 | +1.2% |
AIE | 16.0 | 20.3 | -21.5% | 21.2 | 18.1 | +16.8 |
Hi-Tech | 7.9 | 7.7 | +1.9% | 50.3 | 65.8 | -23.5% |
Other | 21.3 | 22.8 | +9.4% | 56.4 | 53.9 | +4.8% |
Total | 80.5 | 81.8 | -1.7% | 171.4 | 180.7 | -5.2% |
On an annual basis, both segments achieved revenue as follows:
(USD) | GETS | PPS | ||||
(Millions) | FY 2014 | FY 2013 | Change | FY 2014 | FY 2013 | Change |
OGC | 142.4 | 122.5 | +16.2% | 184.3 | 144.4 | +27.6% |
AIE | 73.4 | 74.7 | -1.8% | 82.9 | 74.8 | +10.9% |
Hi-Tech | 32.1 | 30.4 | +5.7% | 228.2 | 277.8 | -17.2% |
Other | 87.5 | 93.7 | -6.6% | 233.3 | 211.6 | +10.2% |
Total | 335.4 | 321.3 | +4.4% | 728.7 | 708.6 | +2.8% |
The company also provides staffing services through its franchised Management Recruiters International (MRI) subsidiary.
(USD) | MRI | |||||
(Millions) | Q4 2014 | Q4 2013 | Change | FY 2014 | FY 2013 | Change |
Contract Staffing | 11.3 | 11.0 | +2.5% | 45.8 | 44.3 | +3.3% |
Royalties/Fees | 3.5 | 3.5 | -0.5% | 13.1 | 13.6 | -4.0% |
Total | 14.8 | 14.6 | +1.8% | 58.9 | 58.0 | +1.6% |
Looking forward, the company expects to achieve revenue in the first quarter ending 31 March 2015 of between USD 250 million and USD 260 million.
In trading yesterday, the company’s share price closed down 0.3% at USD 18.43, an increase of 3.4% compared with a year ago. Based on its current share price, the company has a market value of USD 361.6 million.