Northwest Pipe Reports Q2 2012 Financial Results and Announces Conference Call

VANCOUVER, WA--(Marketwire - Aug 6, 2012) - Northwest Pipe Company (NASDAQ: NWPX) today announced its financial results for the second quarter of 2012. The Company will broadcast its second quarter 2012 earnings conference call on Tuesday, August 7, 2012, at 9:00 am PDT.

Second Quarter 2012 Results

Net sales for the quarter ended June 30, 2012 decreased 8.9% to $131.0 million compared to $143.8 million in the quarter ended June 30, 2011. Gross profit was $13.6 million (10.4% of net sales) in the second quarter of 2012, a decrease from $16.7 million (11.6% of net sales) in the same quarter of 2011. Net income for the second quarter of 2012 was $3.6 million or $0.38 per diluted share compared to $5.0 million or $0.53 per diluted share for the same period in 2011.

Water Transmission sales decreased by 20.7% to $59.1 million in the second quarter of 2012 from $74.5 million in the second quarter of 2011. The decrease in sales was due to a 19% decrease in volume and a 3% decrease in selling price per ton. Water Transmission gross profit decreased to $8.1 million (13.8% of segment net sales) in the second quarter of 2012 from $11.5 million (15.5% of segment net sales) in the same quarter of the prior year. The decrease in gross profit was primarily due to the decrease in volume.

Tubular Products sales increased 3.8% to $72.0 million in the second quarter of 2012 from $69.3 million in the second quarter of 2011, driven by a 1% increase in tons sold from 55,700 tons to 56,500 tons and a 1% increase in the average selling price per ton. Tubular Products gross profit increased by 5.6% to $5.4 million (7.5% of segment net sales) in the second quarter of 2012 from $5.1 million (7.4% of segment net sales) in the same quarter of 2011. As discussed in the first quarter 2012 conference call, downtime in the Atchison, Kansas facility in May, 2012 to complete the previously announced expansion project negatively impacted margins in the second quarter.

As of June 30, 2012, the backlog of orders was approximately $273 million, with the Water Transmission segment representing approximately $245 million and the Tubular Products segment representing approximately $28 million. This compared to a total backlog of orders of $256 million as of June 30, 2011, with the Water Transmission segment representing approximately $208 million and the Tubular Products segment representing approximately $48 million. The Water Transmission segment's backlog as of June 30, 2012 represents a record for that segment. The backlog includes confirmed orders, including the balance of projects in process, and projects for which the Company has been notified that we are the successful bidder even though a binding agreement has not been executed.

Outlook

"We saw lower net sales and net income in the second quarter of 2012 as compared to the second quarter of 2011, particularly in our Water Transmission segment," said Richard Roman, President and Chief Executive Officer of the Company. "However, with the Lake Texoma project we announced a couple weeks ago, we anticipate that the second half of 2012 will be stronger in the Water Transmission segment than the first half of 2012. Consistent with other domestic tubular producers, the Tubular Products Group will struggle through at least the summer as we expect significantly higher imports of energy products to reduce net sales and profitability for that segment."

Conference Call

The Company will hold its second quarter 2012 earnings conference call on Tuesday, August 7, 2012 at 9 am PDT. The live call can be accessed by dialing 800-369-3340 passcode NWPIPE. For those unable to attend the live call, a replay will be available approximately one hour after the event and will remain available for 30 days by dialing 866-441-1050 passcode 6301.

About Northwest Pipe Company

Northwest Pipe Company manufactures welded steel pipe and other products in two business groups. Its Water Transmission Group is the leading supplier of large diameter, high-pressure steel pipe products that are used primarily for water infrastructure in North America. Its Tubular Products Group manufactures smaller diameter steel pipe for a wide range of products including energy, construction, agriculture and industrial systems. The Company is headquartered in Vancouver, Washington and has nine manufacturing facilities across the United States and Mexico.

Forward-Looking Statements

Statements in this press release by Richard A. Roman are "forward-looking" statements within the meaning of the Securities Litigation Reform Act of 1995 and Section 21E of the Exchange Act that are based on current expectations, estimates and projections about our business, management's beliefs, and assumptions made by management. These statements are not guarantees of future performance and involve risks and uncertainties that are difficult to predict. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements as a result of a variety of important factors. While it is impossible to identify all such factors, those that could cause actual results to differ materially from those estimated by us include changes in demand and market prices for our products, product mix, bidding activity, the timing of customer orders and deliveries, production schedules, the price and availability of raw materials, excess or shortage of production capacity, international trade policy and regulations and other risks discussed in our Annual Report on Form 10-K for the year ended December 31, 2011 and from time to time in our other Securities and Exchange Commission filings and reports. Such forward-looking statements speak only as of the date on which they are made and we do not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date of this release. If we do update or correct one or more forward-looking statements, investors and others should not conclude that we will make additional updates or corrections with respect thereto or with respect to other forward-looking statements.

NORTHWEST PIPE COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
(Dollar and share amounts in thousands, except per share amounts)
				Three Months Ended								Six Months Ended
				June 30,								June 30,
				2012				2011				2012				2011
Net sales:
	Water Transmission			$	59,050			$	74,459			$	117,481			$	133,104
	Tubular Products				71,991				69,342				155,735				122,155
		Net sales			131,041				143,801				273,216				255,259
Cost of sales:
	Water Transmission				50,901				62,928				99,633				111,679
	Tubular Products				66,563				64,202				143,506				112,141
		Total cost of sales			117,464				127,130				243,139				223,820
Gross profit:
	Water Transmission				8,149				11,531				17,848				21,425
	Tubular Products				5,428				5,140				12,229				10,014
		Total gross profit			13,577				16,671				30,077				31,439
Selling, general, and administrative expense					6,607				5,603				13,928				12,892
Operating income (loss):
	Water Transmission				6,130				9,142				14,154				17,403
	Tubular Products				4,651				4,304				10,847				8,153
	Corporate				(3,811	)			(2,378	)			(8,852	)			(7,009	)
		Operating income			6,970				11,068				16,149				18,547
Other expense/(income)					(34	)			284				2				397
Interest income					(46	)			(23	)			(87	)			(23	)
Interest expense					1,526				2,575				3,166				5,193
Income before income taxes					5,524				8,232				13,068				12,980
Provision for income taxes					1,920				3,255				4,730				5,071
Net income				$	3,604			$	4,977			$	8,338			$	7,909
Basic earnings per share				$	0.38			$	0.53			$	0.89			$	0.85
Diluted earnings per share				$	0.38			$	0.53			$	0.88			$	0.85
Shares used in per share calculations:
	Basic				9,374				9,327				9,372				9,316
	Diluted				9,433				9,355				9,423				9,348

NORTHWEST PIPE COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited)
(Dollar amounts in thousands)
				June 30,			December 31,
				2012			2011
Assets:
	Cash and cash equivalents			$	25		$	182
	Trade and other receivables, net				72,229			69,894
	Costs and estimated earnings in excess of billings on uncompleted contracts				48,526			38,029
	Inventories				120,604			107,169
	Other current assets				7,475			11,649
		Total current assets			248,859			226,923
	Property and equipment, net				152,612			152,846
	Other assets				33,569			33,604
		Total assets		$	435,040		$	413,373
Liabilities:
	Note payable to financial institution			$	52,000		$	-
	Current maturities of long-term debt				8,975			9,072
	Accounts payable				30,686			20,248
	Accrued liabilities				40,805			19,175
	Billings in excess of cost and estimated earnings on uncompleted contracts				3,681			7,814
		Total current liabilities			136,147			56,309
	Note payable to financial institution				-			62,000
	Other long-term debt, less current maturities				18,637			24,418
	Other long-term liabilities				30,307			30,379
		Total liabilities			185,091			173,106
Stockholders' equity					249,949			240,267
		Total liabilities and stockholders' equity		$	435,040		$	413,373