Gulf Island Fabrication Reports Q1 2025 Financial Results with Revenue Decline and Strategic Developments

Gulf Island Fabrication, Inc. reported its financial results for the first quarter of 2025, revealing a revenue of $40.3 million, a decrease of 6.1% from $42.9 million in the same period of 2024. The company's gross profit increased to $6.6 million, representing a gross profit margin of 16.4%, compared to $6.1 million and a margin of 14.3% in the prior year. Net income for the quarter was $3.8 million, or $0.23 per diluted share, down from $6.2 million, or $0.37 per diluted share, in the first quarter of 2024. The decline in revenue was primarily attributed to lower offshore services work in the Services Division, which saw a decrease of $5.7 million, while the Fabrication Division experienced a revenue increase of $3.6 million due to higher small-scale fabrication activity.

The company noted significant operational changes, including the completion of the wind-down of its Shipyard Division, which is no longer a reportable segment as of January 1, 2025. The final warranty period for the Ferry Projects, which were part of the Shipyard Division, expired in the first quarter of 2025. Gulf Island is now focusing on its Services and Fabrication divisions, which are expected to drive future growth. The company also reported an increase in contract assets to $10.1 million, up from $8.6 million at the end of 2024, reflecting higher unbilled positions on various projects.

In terms of strategic developments, Gulf Island entered into a senior secured, super-priority debtors-in-possession credit agreement with ENGlobal Corporation, which filed for Chapter 11 bankruptcy. The agreement allows Gulf Island to loan up to $2.5 million to ENGlobal, with $1.2 million already advanced. Additionally, Gulf Island has agreed to acquire certain assets of ENGlobal, with the acquisition expected to be completed in the second quarter of 2025. This move is part of Gulf Island's strategy to diversify its operations and reduce reliance on the offshore oil and gas construction sector.

The company’s total assets increased to $138.2 million as of March 31, 2025, compared to $133.2 million at the end of 2024. Shareholders' equity also rose to $96.7 million, up from $93.1 million, driven by retained earnings and stock repurchases. Gulf Island repurchased 86,364 shares during the quarter, with $3.1 million remaining under its share repurchase program. Looking ahead, Gulf Island aims to secure profitable new project awards and maintain operational efficiency while navigating the challenges posed by oil and gas price volatility and macroeconomic conditions. The company remains focused on expanding its skilled workforce and diversifying its service offerings to enhance its competitive position in the market.