Great Lakes (GLDD) wins several dredging contracts and increases its order book
Great Lakes Dredging and Wharf Company GLDD has won several major dredging contracts valued at $ 261.3 million.
As part of the Upper Bay Reach Corpus Christi Canal Improvement Project, Great Lakes will increase the depth of the Upper Bay Reach Canal from 47 feet to 54 feet and widen the channel to 530 feet, with an additional 400 feet of lane for barges. The project will allow the Port of Corpus Christi to accommodate larger vehicles, including two-way traffic during periods of heavy traffic. The company has already completed the first phase of this four-phase Corpus Christi deepening project in March 2020. The US Army Corps of Engineers in the Galveston District valued the project at $ 151.9 million, of which a base award of $ 139 million, with open options. remaining to be granted of $ 12.9 million. The project is expected to start in the fourth quarter of 2021 and end in the first quarter of 2023.
Work on the Fire Island Inlet project at Montauk Point Beach – which was awarded by the US Army Corps of Engineers, New York District – involves dredging the Fire Island Inlet and putting the dredged material to good use for the sand placement at Gilgo Beach and Robert Moses State Park. This will improve protection of the shoreline from damaging storms and make navigation in inlets easier for the Coast Guard and the public. Work on the contract will begin in the fourth quarter of 2021 and is expected to be completed in the first quarter of 2022.
The third project named Thimble Shoal East Deepening Project has been awarded by the Virginia Port Authority and is expected to begin next spring, with estimated completion in August 2022. The work involves dredging portions of the Federal Thimble Shoal Shipping Canal, a efficient use of dredged material to feed the beach at Ocean View Beach, Norfolk and Ocean Park, Virginia Beach.
The southwest Mississippi River hopper dredger rental project from Baton Rouge to the Gulf of Mexico – awarded by the US Army Corps of Engineers, New Orleans District, in the second quarter – will allow Great Lakes to provide a fully equipped and equipped self-propelled trailing suction dredger to maintain work in the southwest pass of the Mississippi River and the Calcasieu River. The project is expected to start in the fourth quarter and end in the first quarter of next year.
The latest award, the Cape May Inlet Beach Renovation Project, is expected to begin in the third quarter and is expected to be completed before the end of the year. The work includes the placement of sand from a designated borrow area on two beach locations in Cape May Inlet. This project was awarded by the US Army Corps of Engineers, District of Philadelphia.
David Simonelli, Chief Operating Officer of Great Lakes, said: “Great Lakes is delighted to add these projects to our backlog of deepening, coastal protection and maintenance dredging projects that will contribute to our performance. in 2021 and will position us well for 2022. “
US dredging operation bodes well
Great Lakes, which share space with Dycom Industries, Inc. DY in the Zacks Construction products – Heavy construction industry, is the largest dredging service provider in the United States. The company mainly relies on strong domestic dredging operations, high equipment utilization, strong project execution and savings resulting from restructuring.
Image source: Zacks Investment Research
Shares of this company Zacks Rank # 5 (Strong Sell) have significantly outperformed the industry over the past three months. Its shares rose 2.4% during the said period compared to an industry decline of 13.6%.
In May, he won several major dredging jobs in Alabama, Louisiana, Florida, Arkansas, Kentucky, Mississippi, Missouri and Tennessee. These contracts, which include deepening, coastal protection and maintenance dredging work, are valued at $ 112.8 million.
We believe that the company’s strong bidding capacity and project execution will increase its performance in 2021 and beyond. Zacks’ consensus estimate for third quarter 2021 earnings is currently set at 29 cents, indicating a 52.6% year-over-year improvement.
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Some higher ranked stocks in the same industry include Granite Incorporated Construction VAB and Sterling Construction Company, Inc. STRL. While Granite Construction sports a Zacks Rank # 1, Sterling carries a Zacks Rank # 2 (Buy). Granite Construction and Sterling are expected to generate earnings growth of 40% and 30.3% for the current year, respectively.
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