EA Engineering posts loss for quarter Government shutdowns, weather are blamed

March 29, 1996|By Michael Dresser | Michael Dresser,SUN STAFF

Snow and government shutdowns dealt twin blows to Hunt-Valley-based EA Engineering, Science, and Technology Inc. during its most recent quarter, sending it skidding to a substantial loss.

EA, an environmental engineering and consulting company, reported a loss of $830,500, or 13 cents a share, for its second quarter, which ended Feb. 28. For the same quarter a year ago, EA reported a profit of $501,200, or 8 cents a share.

EA's revenues tumbled to $14.5 million from the record $16.7 million it reported a year earlier.

In its earnings release, the company also signaled that staff reductions could be on the horizon. "EA will continue to evaluate its staffing requirements in an effort to control expenses while vigorously pursuing private-sector clients," it said.

Chief Executive Loren D. Jensen blamed the second-quarter loss on "unusually harsh weather conditions throughout the Northeast" during a period that traditionally is EA's weakest.

He also cited delays in funding for federal contracts because of the nation's budget crisis, and possibly unrecoverable costs in the completion of several large contracts, as reasons for the company's loss.

The grim news was tempered by the announcement that EA has signed an environmental consulting services contract with Mobil Oil Corp., giving it an important boost in the nongovernment market. EA did not put any specific value on the contract.

"Any commercial contract they win is important -- particularly from someone as big as Mobil," said Laurence C. Baker, a vice president of Legg Mason Wood Walker in Baltimore.

Mr. Baker said the company's explanation for its second-quarter woes is entirely credible.

"They still had people on the payroll during the quarter that they were watching it snow," he said.

But Mr. Baker said he expects the company to make a strong comeback, pointing to its $261 million backlog in orders.

"I think they'll have a fairly good second half that will more than make up for this one-quarter loss," he said.

Pub Date: 3/29/96

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