Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from Matt Duncan - Stephens Inc.
Matt Duncan - Stephens Inc.
The first question I’ve got goes back to your gross margins, you guys have doing a very good job, managing project cost and continue to execute well in this holding up your gross margins. How much longer do you think that continued and are you starting to sort of get into some backlog if that was priced in more difficult time and should we continue to expect your gross margins to go down a little bit going forward because of that?
Bill George
Let me make just a couple of comments and perhaps Brian, will address. I think that in this quarter, we had some very good closeouts on the jobs and we got this mix of situation in our business. As you know Matt, our service business curious with it, generally higher growths in that market than does our construction business. So we have this junction of closing out some very good jobs and also that the mix.
In general work we are booking is at lower gross margins prospectively. We think, we’re grinding in a lot of new productivity here and we may feel to net few basis points with a greater in these new, but clearly there is margin compression ahead of us on new awards. Brian, you want to add to that?
Brian Lane
Yes just a little bit on that Mark, there is margin compression, but we’ve done a lot in the last few years to mitigate some of that in terms of productivity on the labor side, yet that we’ve made in free fab in the training we done. So there is some a plus as well as margin compression too.
Matt Duncan - Stephens Inc.
When you guys look at the competitive environment and the pricing pressures that you are facing. Do they seem to be getting worse or is it kind of stabilizes in terms of the pressure that you’re getting on price as you’re bidding new contracts?
Brian Lane
I would say that, there are two ways to look at that question. Keeping in mind that we’re a late cycle players, so we’re starting to book worth that we’ve been working for a while, I would say, it’s starting to get worse. The immediate work, it certainly worse because like I said, we lag the business cycle, there are signs of improvement, but at the end of the day, we probably too early for us to draw conclusions from them.
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