Gulf Island Fabrication Reports Revenue Decline and Net Loss in Q2 2025

Gulf Island Fabrication, Inc. reported a decline in financial performance for the second quarter of 2025, with revenues of $37.5 million, down from $41.3 million in the same period last year. The company experienced a net loss of $574,000, compared to a net income of $1.9 million in the prior year. For the first half of 2025, total revenues were $77.8 million, a decrease from $84.1 million in the first half of 2024. The gross profit margin also fell slightly to 9.5% from 10.1% year-over-year, reflecting challenges in both the Services and Fabrication divisions.

The company attributed the revenue decline to lower activity levels in its Services Division, which saw a decrease of $0.8 million primarily due to reduced offshore services work. The Fabrication Division also faced challenges, with a revenue drop of $2.9 million linked to decreased small-scale fabrication activity. Additionally, Gulf Island's general and administrative expenses remained relatively stable, totaling $3.3 million, a slight decrease from $3.4 million in the previous year.

Strategically, Gulf Island made significant moves during the quarter, including the acquisition of certain assets from ENGlobal Corporation, which was finalized in two phases: the Automation Business on May 12, 2025, and the Engineering and Government Businesses on June 16, 2025. This acquisition is expected to enhance Gulf Island's service offerings and customer base, particularly in engineering and technical field services. The company incurred transaction costs of $0.3 million related to this acquisition, and a reserve of $1.5 million was recorded for an Alliance Payment associated with the acquisition.

Operationally, Gulf Island's total assets increased to $134.3 million as of June 30, 2025, compared to $133.2 million at the end of 2024. The company reported a working capital of $82.6 million, bolstered by cash and cash equivalents of $46.8 million. However, the company noted that its backlog, which reflects unrecognized revenue from new project awards, was lower at $6.8 million compared to $15.6 million at the end of 2024, indicating potential challenges in securing new contracts.

Looking ahead, Gulf Island aims to stabilize its operations and improve profitability by focusing on securing new project awards and enhancing its service offerings. The company is also monitoring the impacts of oil and gas price volatility and macroeconomic conditions on its business, as these factors could significantly influence future performance. The management remains committed to integrating the Englobal Business and leveraging its capabilities to drive growth in both traditional and emerging markets.