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$7.8 Million Operating Loss for Oil and Gas Division in Second Quarter Points to Continuing Problems
WASHINGTON, D.C. (September 5, 2014) –The Laborers’ International Union of North America and its affiliated benefit funds today welcomed the announced departure of Willbros Group CEO Randy Harl, but noted concern remains over the company’s troubled Oil and Gas Division. The union and its funds issued the following statement:
We congratulate John T. McNabb, II, non-executive Chairman of the Board of the Company, on his election by the Willbros board of directors as Executive Chairman of the Board due to the retirement of Willbros’ CEO Randy Harl. We monitored management changes this year and will continue to do so. Willbros faces ongoing challenges relating to the performance of the Oil and Gas Division, safety on pipeline jobs and executive compensation.
In May 2014 LIUNA’s benefit funds led a shareholder victory to reject the company’s executive pay proposal. After years of lackluster stock performance, project execution programs and consistently weak margins, LIUNA funds brought a message of accountability and change to the shareholder meeting that resonated with many investors.
LIUNA funds remain concerned. Despite management changes announced in May, Willbros stock has fallen 11 percent in the last three months. Additionally, on Aug. 4, Willbros announced that the Oil and Gas Division lost $7.8 million in the second quarter. The loss is more than twice the division’s first quarter loss of $3.6 million.
Shareholders should remain concerned that the troubled Oil and Gas division continues to post operating losses. Safety issues also should remain of concern to all shareholders and employees.
Four days after Willbros’ shareholder meeting, a company division struck a gas line leading to an explosion in Midland, Texas. Newspaper and television coverage included interviews with bystanders trapped in their cars due to fire and smoke. No one was injured, but the accident showed that safety remains a key issue for shareholders.