Mary Morrissey - Investor Relations Mark Marinko - Chief Financial Officer Jon Berger - Chief Executive Officer.

Jon Tanwanteng - CJS Securities Drew Lipke - Stephens Inc Jing Feng - Barclays Scott Levine - Imperial Capital David Olkovetsky - Jefferies John Rogers - D.A. Davidson Larry Callahan - Wheelhouse Securities.

Good day, ladies and gentlemen, and welcome to the Great Lakes Dredge and Dock Corp Fourth Quarter 2014 Earnings Conference Call. At this time, all participants are in a listen-only mode. [Operator Instructions] As a reminder, today’s program is being recorded.

I would now like to introduce your host for today's program, Mary Morrissey, Investor Relations. Please go ahead..

Thank you. Good morning. This is Mary Morrissey, and I welcome you to our quarterly conference call. Jon Berger, our Chief Executive Officer; and Mark Marinko, our Chief Financial Officer, will discuss the operational and financial results for the quarter and year ended December 31, 2014.

Following their comments, there will be opportunity for questions. During this call, we will make certain forward-looking statements to help you understand our business. These statements involve a number of risks, uncertainties and other factors that could cause actual results to differ materially from our expectations.

Certain risk factors inherent in our business are set forth in our filings with the SEC, including our 2013 Form 10-K and subsequent filings.

During this call, we will also refer to certain non-GAAP financial measures, including adjusted EBITDA from continuing operations, which are explained in the net income to adjusted EBITDA reconciliation attached to our earnings release and posted on our Investor Relations website, along with certain other operating data.

I would now turn the call over to Mark Marinko, our CFO..

Thank you, Mary. And good morning to everyone joining us. As it’s customary, we issued our press release this morning, which contains detailed information about our fourth quarter and full year 2014 results. During the call, I will discuss with you some of the more significant results.

Our Dredging segment had a strong fourth quarter with $212 million in revenue up 20% compared to the fourth quarter of 2013. During the fourth quarter, we completed the Wheatstone LNG project in Australia and executed on other capital, maintenance and coastal protection projects. For the year, dredging recorded annual revenue of $698 million.

Despite a slower fourth quarter our Environmental & Remediation segment showed an increase in annual revenue of $114 million for the year. As previously announced, we acquired Magnus Pacific in November. So from November going forward its financial results will be included in this segment.

For the months of November and December, Magnus revenue was $15 million. The company’s gross profit margin declined to 9% for the quarter from 13% and to 11% for the year versus 14% in 2013. Compared to the fourth quarter 2013, dredging’s gross profit margin improved to 14%, largely driven by a strong contract margin on the Wheatstone LNG project.

For the year, dredging gross profit margin was stable at 13% when compared to the prior year period. Our Environmental & Remediation segment experienced a negative gross margin of 23% for the fourth quarter, which primarily led to a significant drop in gross margin to 2% for the year. I will walk through the main components driving this loss.

During the fourth quarter changes in scope in cost overruns on a fixed scope project in our Environmental & Remediation segment led to $4.3 million in extra work and a write-down in margin. We’re in discussions with the client and are hopeful that we will receive some payment for this work.

However, under our accounting policies, we have recognized this cost associated with this work and until we have agreement and documentation on additional billings, we will not recognize any revenues on this work. Jon will go into further detail on this project later during the call. Terra made significant investments in its equipment.

Terra invested almost $4 million more in its expanded fleet of equipment in 2014 compared to 2013 and with the expanded fleet, depreciation expenses grew by over $2 million compared to last year.

Lastly Magnus recorded negative gross profit of $1.7 million in November and December, which is the result of an anticipated seasonal slowdown in its business. The weaker gross profit margin primarily led to - to the company recording operating income of $24 million for the year, compared to $51 million in 2013.

As a reminder last year’s results included $13 million in proceeds from a loss of used claims settlement and a $6 million gain related to the sale of underutilized assets.

The company’s adjusted EBITDA from continuing operations was $32 million in the fourth quarter, which was a 27% increase compared to the fourth quarter in 2013, bringing the full year EBITDA to $77 million.

Moving to the bidding market in 2014, as we indicated in our last earnings call bidding activity significantly picked up in the fourth quarter, when many large Superstorm Sandy related coastal protection projects were tendered.

For the full year, the annual domestic bid market was $1.5 billion, a slight increase compared to the $1.3 million domestic bid market in 2013. Great Lakes won 38% or $570 million of the bid market with an additional $114 million in low bids and options pending award.

Breaking it down by work type in 2014 Great Lakes won 33% or $150 million of the capital projects awarded, 44% or $266 million of the coastal protection projects awarded, 18% or $59 million of the maintenance projects awarded and 65% or $95 million of the rivers and lakes projects awarded.

Please remember the variability and contract wins from quarter-to-quarter is not unusual and the win rate from one quarter is not indicative of the win rate the company is likely to achieve in the full year. Rivers and lakes awards include the $90 million Lake Decatur dredging project that was awarded in the first quarter of 2014.

In addition, the company was awarded the $140 million Suez Canal deepening project during the fourth quarter. Contracted dredging backlog at December 31, 2014 was $594 million with an additional $114 million in options and low bids pending award. The Environmental & Remediation segment finished the year with $75 million in backlog.

Terra contributed $21 million to the backlog total, a decline of 24% compared to 2013, when it had one very large project and backlog last year, with Magnus making up the remaining backlog. Both Magnus and Terra have added significantly to their backlog and pending awards since year end.

We expect to increase our book backlog in this segment to over $100 million. We have a master service agreement with the client and are currently - during the fourth quarter, we sold real estate owned jointly by our Amboy Aggregates and lower main joint ventures. As a result of this real estate transaction, we recorded a gain of just over $15 million.

This gain is in the equity and joint ventures line of our income statement. It is partially offset by operating losses at Amboy Aggregates and our TerraSea joint venture. We completed a $25 million add-on to our 7.35% senior notes to fund a portion of the Magnus acquisition.

As noted during our third quarter earnings call, we also put in place a $50 million term loan to partially finance contraction and the ATB. In 2014, the company spent $44 million on the ATB funding in par from the $10.5 million letter of credit we received from the original shipyard.

Construction is progressing along nicely and we expected to be put in the water for testing in the fourth quarter of 2016. Finally, our strong cash performance during the fourth quarter enabled us to pay down our revolving line of credit.

As we continue to focus on growing our business, we will continue to deploy capital in a physically responsible manner, valuing our alternatives and determining the best use of capital for the company and its shareholders.

Now, we’ll turn the call over to Jon Berger, who will discuss some of the key themes that emerged in 2014 as well as comments on the future of our business..

Thank you, Mark and good morning everyone. In many ways 2014 was a transformative year for Great Lakes. We were successful in executing our strategy of eliminating the underperforming and non-core assets that we can focus on profitable growth in our core businesses.

The first made to our accomplishment was the sale of our historic demolition business in April. In the fall, our Amboy’s Aggregates joint venture sold its New York sand and stone subsidiary, which we mentioned during our last earnings call. And as Mark just mentioned, we sold Amboy Aggregates real estate at the end of the year.

We are now in the process of liquidating the remaining operating assets, which will be completed in the second quarter of this year. And as I mentioned during our last earnings call, we’ve agreed to dissolve our remaining joint venture as soon as the project we’re executing is completed last this year.

With all these transactions behind us, we will be able to dedicate significantly more of our time and resources on our Dredging and Environment & Remediation businesses. This was a key focus for us during the year, and was an essential step in executing our strategy.

I’m confident with our streamline businesses that we are better positioned to achieve our growth and profitability objectives. Let’s move on to more specific commentary in our segment results. I’ll start with our Environmental & Remediation segment.

We’re pleased that the segment continued grow year-over-year, but operating income obviously was unacceptable. As Mark mentioned, the cause for the Environmental & Remediation segment’s performance is attributed to a dispute on a Brownfield redevelopment project in New Jersey.

The issue is due to disputed site conditions related to the presence of toxins in a portion of the land that was believed to be uncontaminated with the toxins as well as an underestimate in the amount of toxins required removal in a separate portion of the property.

Our client took out an insurance policy to deal with these issues on the land parcel and the insurance company recently denied the claim. It is working to resolve this issue with the insurer and is hoping for a positive outcome in 2015.

We have a pending change order with our client and are working with them to receive payments for the additional work we preformed due to the change in site conditions. During the year Terra successfully completed projects for some key clients including Enbridge.

Although work was completed in 2014 on this multiyear Enbridge project, Terra’s professionalism and execution on the project helped contribute to the development of a strong working relationship with this client. We are in dialog with the Enbridge about future opportunities and are confident will work with them on other projects in the future.

Terra has projects and backlog with multinational companies in the energy and manufacturing industries. In addition, since year end Terra received verbal commitment on a $22 million project for a large utility on the East Coast and is also been awarding nearly $14 million of work in Florida, Georgia, Louisiana and Texas.

We made significant investments in personal and office space in 2014, laying a strong foundation for geographic expansion in 2015 and beyond. We have Greenfield offices in San Antonia, Philadelphia and Cushing, Oklahoma in 2014, along with our tuck-in acquisition/equipment purchases in Northern Michigan.

The utility projects from the East Coast and the projects from the southern United States are early indicators of the potential that exist for us in these markets.

As we continue to grow our footprint in these regions in 2015, project awards in these states should help offset the seasonality that this segment is currently experiencing in the winter months. As we discussed during our third quarter conference call, we completed the Magnus acquisition in November of 2014.

At December 31, 2014 Magnus had $54 million in backlog and it is finalizing the third year task order under a mass to service agreement for a mind reclamation project. This time and materials project should be between $35 to $50 and start in late March early April.

The integration is progressing well and we’re optimistic about how the combined platform of Terra and Magnus capabilities will enable us to be a nation-wide environmental and geotechnical service provider of significant size. Like Terra, Magnus had some seasonality in its business.

With the winter months being impacted, which is why geographic expansion is critical. In addition to the Greenfield locations mentioned earlier by Terra, Magnus opened an office in Atlanta at the end of 2014 to further enhance our Southeast presence.

As we stated, we envision our Environmental & Remediation segment being one of the primary growth vehicles for the company working in conjunction with our rivers and lakes division of dredging. We believe we have put together one of the largest nation-wide contractors specializing in Environmental & Remediation services on land and water.

As we continue to grow this segment, we’ll be focused on ensuring the profit controls are in place and that we selectively target opportunity that align with our capabilities, keeping project execution at the forefront. Let’s turn to the Dredging segment. Our dredging’s operations ended the year on a much higher note than where we started.

In November, after having a significant portion of our fleet in the Middle East ideal for most the year, we were awarded a $140 million Suez Canal deepening project. We are one of numerous international dredging companies working on this historic fast track project. Dredging began in December and we will continue until October of this year.

We also have dredges working on a $35 million East Hidd project through the end of the first quarter. Over the last couple of months, the market in the Middle East has picked and we have bid on or planned to bid on projects in Saudi Arabia and Bahrain. We also continue to explore opportunities in Mozambique and Brazil.

Working in Egypt does have a safety concerns and we continue to monitor the geopolitical landscape carefully. We have taken numerous other precautions along with the other dredging companies working on the Suez project to protect our people and equipment. During the fourth quarter, we completed a highly successful Wheatstone LNG project in Australia.

The Dredging New York has been transported back to the United States and we’ll be working at the Port Miami deepening project. We executed on the Miami project throughout the course of the year and we’ll continue working on it through the summer on schedule. This is a high profile project that as the attention of all the U.S. port community.

It’s success is critical to future port deepening projects and we are proud to be working on it. As Mark mentioned, there was also an uptick in the bid market in the fourth quarter as well. Our 61% win rate was well above our win rate for the year of 38% leading to record backlog as Mark previously mentioned.

In 2015, we do not expect to see the unprecedented level of bidding that we experienced in the fourth quarter. We expect the market to go back to normalized historical levels. In 2014, coastal protection projects related to Superstorm Sandy accounted for almost 50% of our awards.

The coastal protection work will begin this spring, but approximately $100 million of this award will not be executed until 2016. As we have discussed previously the set of Sandy projects that we were awarded, what we call Phase II of Sandy water.

Over the next year we expect to see a handful of additional Phase II projects that will be put out to bid, Manasquan being the first. But the tender for Manasquan originally scheduled for January being pushed back to the spring, we had some concern at the timing of these projects could be delayed, similar to what occurred last year.

As you know it is difficult to know exactly which quarter or the timing of when bids will be tender. Regarding major capital projects, the Savannah deepening project bid late last year, at this time no decision has been made. Other port deepening projects are moving along, but it is unlikely that one will be put out to bid in 2015.

In the Gulf, we are slowly starting to see some movement and are tracking these opportunities. The State of Louisiana budget is robust for coastal restoration and as the BP settlement gets closer it will build momentum. In addition, we continue to monitor events in the LNG market and despite what is happening in the energy prices.

We still expect some projects to move forward. So we continue to believe there will be LNG related work in the region. As of the case, every quarter and every year, in order to be successful we need to accurately bid and win our share of the dredging work and execute well on each project.

However, we do enter 2015 with more work booked already to be executed this year than we had in our most recent three years, less transition to events in Washington D.C. and the impact from the dredging industry. President Obama signed a spending bill in December that provides for an increase in the quarter’s budget in 2015.

It also files the requirements laid out in word, the water bill signed into June, signed into along June hitting the $1.2 billion harbor maintenance trust fund spending target for maintenance projects, which was a victory for the industry. However, the President sent is proposed fiscal 2016 to Congress and it’s not where we wanted to be for dredging.

But we are early on the process and remain confident that Congress will go too bad for increased infrastructure spending including marine infrastructure. This just underscores the need to be ever vigilant as an industry and working with light minded businesses concerned with the growth in our economy.

We need to keep the pressure on our elected officials. Finally, I would like to highlight an important step forward that we took in our journey to be [indiscernible] free work environment with the implementation of our life saving absolutes and accountability program that we put in place on February 1st of this year.

We rolled out our safety accountability policy to enhance our intent and industry free safety practices already in place with the goal of all Great Lakes personnel consistently holding themselves and won another accountable for working safely. Our ultimate goal is to have zero recordable incidents.

I want to thank everyone involved implementing this program and it is another step in our industry-leading safety program. With that, we would like to open up the line for any questions you may have..

[Operator Instructions] Our first question comes from the line of Jon Tanwanteng from CJS Securities. Your question please..

Good morning. Thanks for taking my questions..

Sure, Jon..

Just wondering about the headwinds in the Remediation segment, you mentioned the $4.3 million impact on the income, operating income there, what’s the share revenue with that and how much of that is still in the backlog?.

Let me make sure, I get it right. We did about $4 million with the work that we have not been able to billion.

So all of that work has - as hit our P&L and we are negotiating both with our client and the insurance company and we - we have good hopes that we’ll collect a lot of that, not all of it, but a reasonably significant amount of it in the first half of this year.

And as Mark mentioned that’s the, that’s historic accounting policy we recognize all the cost when we incur them, but we can’t recognize revenue until we have agreement with the client as to scope and payment..

Okay, got it.

And when do you think you actually get back to a normalized margin in the segments?.

It’s a much bigger segment now so, we shouldn’t have, the same swings that we have with anyone project. So, we think, the segment should perform well this year.

But I do understand that both Magnus and Terra where they located, we budgeted for slow first quarter for both of them, because of the historical Terra being in the Midwest during the winter and where it’s obviously very cold and you can’t do much work and Magnus being in the Pacific Northwest where it’s a rainy season.

So they don’t do a lot of work on their projects. And that’s one of the reasons why this geographic expansion and growth in the Southeast and East is so important for us..

Great. That’s helpful.

And then just on the Dredging segment, how should we think about the utilization profile and the margins through 2015 as you run off big projects like Wheatstone and Miami?.

I mean certainly Wheatstone was a very successful project for us, very strong margins. Miami very solid project, lot of utilization equipment margins were not as strong as certainly the Wheatstone was.

We have, as I think I said, I’ll say it again, we start the year with more of our equipment scheduled and in backlog for the year than in the last three years. And so, we have some things to fill out in our schedule, but we’re confident that, we’ll fill it out to meet - to meet, where we expect to be this year..

Okay, great. And then finally, I just wanted to touch on the Venice Beach project. It seems like there are couple of mechanical and weather issues down there.

I’m just wondering if you see that significantly impacting your profitability in the first half, first quarter?.

Yes. I mean Jon, we have ups and downs in every project we budget weather in, we budget mechanical. So, if we have a problem with Venice, our history is we’ll have superior performance on another project that would generally offset this throughout the year..

Okay, great. Thank you very much..

Thank you. Our next question comes from the line of Drew Lipke from Stephens Inc. Your question please..

Hey guys, I’m in here for Trey Grooms. I wanted to ask you on the Environmental & Remediation piece and you talked about opening the new offices in more southern markets through seasonality there.

Is that expense all behind us now or there are more investments there needed? And then kind of with that can you talk about a little bit more on the seasonality that you expect us to see going forward in that business, and how we should kind of think about the cadence of revenue and margin contribution on a quarterly basis?.

Yes. I mean the answer is, we’ve made investments in 2014 that should pay dividend in 2015.

I think, a good example would be Philadelphia, I think we opened that office, probably the second quarter of 2014 and we probably got $25 million to $30 million of revenue scheduled to be worked out at that office this year, including that utility project for $22 million. So, I think we expect all of these offices to be producing in 2015 for us.

And Mark help me out, but I would expect you to see three quarters of our revenue in our Environmental & Remediation businesses coming out of the second and third quarter..

That’s correct..

Yes. So and if you think about it, what we really need to do is we need to be able to get work in warmer weather claims during the winter to increase the utilization of our equipment and also to keep our best people working.

And so that is a clear goal of the combined entity over 2015 and 2016 is to be able to keep your best people working throughout the year and to keep your equipment utilized and that’s where we should see margin upticks once we get that going..

Okay. That’s helpful.

And then you mentioned the Gulf energy related projects and I know these are very long-term projects, but you are seeing just curious, if you are seeing any kind of change in tone from the customer base or any kind of push outs in activity levels there at all?.

Yes. I mean there is one project we’re working on right now, but there is another project that we believed it was our project that got shelf. So significantly more cautioned we still think projects will come out there and we still think that U.S. will be an exporter long-term. But, certainly a lot more caution than we saw before..

Okay. Thanks guys..

Thank you..

Thank you. Our next question comes from the line of Andrew Kaplowitz from Barclays. Your question please. You might have your phone on mute..

Good morning. This is Jing Feng on for Andy Kaplowitz..

Good morning.

How are you?.

Good.

So, my question is, with the cold temperatures that you’ve had that we’ve seen recently particularly in the Northeast, are you seeing any impact to your businesses so far in the 1Q, outside of what we would expect to be the norm?.

Yes. No changes to our business in Q1 really that we don’t really have any big projects way up there right now and let’s call way up in the Northeast out of the Superstorm Sandy projects are happening in the spring time in the new Jersey area. So, we have not seen any impact of that..

Okay, great.

And then you had a pretty good healthy backlog right with good prospects in most of your businesses, but as you look at your businesses now are there any places where you might continue to have some underutilization, what opportunities are you focused on them, are you focusing on them might help us on that?.

Sure, great question. Our international operations has had, a very strong 2014 with the Wheatstone project and we actually with the Suez project and finishing up that East Hidd project, we will have a good solid 15 international.

But we do have concerns, longer term there with certain pieces of our equipment and just the instability of what’s happening in the world in that region. And then our hopper fleet in the U.S. is booked out as I mentioned on working to 16. So, we see long-term visibility on our hopper fleet. And our hydraulics as an industry in the U.S.

is less than totally complete. So, we’re obviously looking at some things to complete that. As we talked about our rivers and lakes as a very healthy backlog, it’s best backlog, there it’s really an execution, story and our Environmental & Remediation business right now most of the businesses have nice backlog.

So, that’s really where it is, it’s longer term view of the Middle East and it’s some segments of our U.S. equipment..

Okay. That’s helpful.

And just my last question is, are you seeing any potential currency related headwinds in your international businesses?.

No in the case of like Suez, we do get some of the payments in Egyptian currencies and we keep that money there, we pay for the local cost there in the Egyptian currency. So, yes we really have been very minimal exposure from a foreign currency perspective..

Okay, great. Thank you..

Yes..

Thank you. Our next question comes from the line of Scott Levine from Imperial Capital. Your question please..

Hey, good morning guys..

Hey, Scott..

I was hoping for some color on the margins that are in backlog, the dredging side specifically, I don’t know if you can break out Wheatstone in terms of the revenue and gross profit contribution in the fourth quarter, but would your expectation be that, you can kind of post margins in the dredging operations in 2015 that are comparable that are worse than what we saw in 2014 based on what’s in backlog now?.

So let - well we generally don’t give kind of a project-by-project margin, but just to give you a little bit of color for 2015, yes when we talk about the hopper work that’s generally a little better margin. But then, some of that will obviously be offset by the improved margin on Wheatstone.

So it really is a little bit of a mix change, but generally we’re in that same [precinct] [ph]..

Got it.

Okay, so margin is comparable all-in in 2015 relative to 2014 as a whole?.

I think that’s exactly right Scott. But as Mark said, we don’t comment on any specific project, because we have ups and downs..

Fair enough.

And then, in terms of the mix as well, given the passage of the word of bill, is your expectation that you would see more maintenance work as part of the mix or give a little bit more color in terms of how you see the mix shaking out in the dredging operations amongst your various categories relative to 2014?.

Yes. I mean certainly with word of passes there will be more maintenance work. We have, been very prudent in how we did and when all of that work came out for Sandy in the fourth quarter we won a significant portion of that.

Because that’s the kind of work that we think we’re most qualified to do, our equipment is most qualified to do and provides us the higher margin. So, beach nourishment is going to be, a big part of our story in 2015 and, one of the nice things of, when maintenance work goes up some of our other competitors may drift towards that.

And so it’s somewhat, clears the decks for us and take some, other competitors out..

Got it.

One last one, SG&A is where you guys posted in the fourth quarter there $80 million and just above kind of a decent run rate to think about or should be little bit higher than that given, I’m guessing the Remediation business struggling that number up a little bit relative versus third quarter?.

Yes. So far you had a little bit, with Magnus you had only two months of Magnus in there, they are not that large on the SG&A side. But, had a little bit of uptick from there, but, yes as Jon previously mentioned, we’ve really kind of made our investments and the expansion on the Environmental & Remediation and we kind of stay at that level.

So you shouldn’t see really any significant increase in that going forward..

And we probably had on the G&A side, we probably had some onetime expenses associated with the transaction..

Got it.

Can you quantify with those where?.

Probably not. I mean we probably could if you gave me half an hour..

Got it. And I will follow-up on that. Thanks..

Thank you. [Operator Instructions]. Our next question comes from the line of David Olkovetsky from Jefferies. Your question please..

Hey, good morning, guys.

Can you just first tell us what the, your expected operating rates are in the Middle East that you’re talking about having a significant portion of your incremental over there utilized, can you give us a sense for what that portion is?.

Well, our hydraulics are fully utilized probably through October on the Suez project. And our equipment, the remaining piece of equipment are occupied through the first quarter in Bahrain and in the rest, we’re looking to fill out.

If I hope that, I am not sure that gives you a great answer and your modeling just because, each of these pieces equipment drive different revenue and suites. But that’s where we are, we have some equipment in the Bahrain that needs to be utilized after the first quarter..

Can you tell us how many pieces of equipment?.

Yes. Again, I’m not sure it gives you a great picture, I think in our press release we told you we probably have a $170 million worth of revenue expect, some $140 million plus some portion of the $35 million project this year, so give you an idea of what’s booked for the Middle East already it’s somewhere between 140, 155 or 160 for the year..

Got it, okay. To follow-up on another caller’s question regarding currencies, is Egypt the only non-U.S. based currency that you are getting paid in, in all of your non-U.S.

work?.

[indiscernible] in Brazil, but that’s small..

Okay. Something like you might have been indicating and maybe I’m reading too much into it.

But that there may be additional assets sales was coming from Amboy is that, am I reading too much into, what are you saying?.

Amboy as some yellow equipment, we are winding down Amboy. So it as some yellow equipment, it has some inventory, it was a very old dredge needs to be scrapped. So it has minimal value it will pay for the winding down costs, but it’s not going to be material..

Okay.

So we shouldn’t expect further gains on sale of asset?.

No. If they are, they are not to be material..

Okay.

And then what’s the rate on the $50 million term loan?.

4.66..

4.66 is that based on, is that based on leverage grid or is just 4.66?.

No. It’s just fixed..

Okay. And was there anything drawn on the revolver and I guess that you paid some of the down, but….

Now, we were at the end of the year we were at zero. Yes other than letters of credit, right, but on cash zero..

Okay.

So how much, what’s your total liquidity at year end?.

Availability under the revolver you mean?.

Well yes, cash plus availability under the revolver?.

So we had $40 million, $42 million of cash and under about $90 million of availability under the revolver, I believe. I think we had a $120 million and I’ll see is with $210 million. It’s right around that number, I’ll get you the exact number..

Okay.

So the revolver is $210 million correct? And so you said $90 million avail that totaled?.

Yes. We had a $120 million of letters of credit and I saw it might, we’re looking up that number..

Okay.

In the meantime, let me just ask you, how much CapEx you’re anticipating in 2015?.

With all-in, I believe it’s with the also with the payments on the ATB, about $85 million..

Okay.

And then just sort of follow-up on that, how much more spending are you expecting on the ATB?.

So we’ve spent about $90 million..

And that’s - I think its $150 million?.

$140..

It’s been $140 million through the end of December, we had how much of it?.

We spent $44, but then we had $10.5 million letter of credit..

Right, so we spent $44 million, yes..

Just got $90 million..

We got $90 million..

So you spent $90 on the ATB so far….

No, no, no, no the other way around we spent about $45 million on the ATB so far and over the next two years it will be about another $90 million, $95 million..

Okay perfect, were you guys able to find the answer on the….

Yes, at year end we got a $160 million outstanding in letters of credit, an availability of $50 million. We had a large letters of credit outstanding at year end related to our Wheatstone project that was has been spent returned. So that’s the difference, yes..

Yes, thank you. Okay perfect guys, thank you very much. Good luck..

Absolutely..

Thanks David..

Thank you. Our next question comes from the line of John Rogers from D.A. Davidson. Your question please..

Hi, good morning..

Good morning, John..

Couple of just follow-up things, first of all for 2015 your total tax rate, what are you expecting there or do you have an additional tax credits available?.

Yes. We’ll have. I mean you’ll see on the book show this effective tax rate of 39%, but in 2014 as we discussed earlier on last quarter’s earnings call we did have a large deduction in the share that’s why you see a tax benefit this year. So we should from a cash tax perspective not have to pay federal taxes in 2015..

And then Mark D&A in 2015, is that been the fourth quarter rate or will it be a decline, pre-tax Magnus?.

I don’t have that number right in front of me..

I would say the fourth quarter rate is probably, correct we think that..

We can double check that for you..

And Magnus when it had a huge..

No..

No..

It’s just a month that would come in, right..

Right..

Okay.

And then just following-up on the dredging business for a second, when you are thinking about margins there and you talk about margins being comparable to 2014, does that include some of the yes, are you timing out the gross level or want to have some SG&A leverage as well in here with the higher revenue level?.

Yes. I mean as revenue goes up arguably we will spread our SG&A over a broader revenue base that’s clearly the case. When we look at margins, we have to talk about what margins we’re talking about….

Your right that should be clear..

Yes, project margins or we’re talking about all-in operating margins..

Okay, all right..

Yes. I think that’s the case and also operating under a larger revenue base with the Magnus, the dredging portion and we’ll take up a little less of our corporate overhead also..

Okay. And then Jon just in terms of the environmental business, I mean even with the project charges and the seasonality of Magnus, the operation still lost money in the quarter.

And is that just strictly seasonal, or I mean how do you think about that business and how should we be thinking about it over the next couple of years the expectations?.

Yes. Good question. If there is a one project that - I forget what that division had a 100 - a little bit over $100 million of revenue. That like many contractors had to a lot of work that we could not recognize the revenue for. And at $100 million that as a significant influence on our ability to drive down the margins.

Now with Magnus, it’s a much more significant business and hopefully that variability will get out of there. But, and also we had seasonality on Magnus coming in for just two months of the year when they are slow. But, we expect the business to have margins that are in line with the industry.

And we are pretty comfortable that with the backlog that segment has; they will do fine in 2015..

Okay.

And not so much 2015 but with the industry, I mean is that mid, high single-digit type margins?.

Yes. I would say, I mean it’s not - the difference between that and our dredging business it’s not a fixed asset business. So I would say that’s probably correct..

And is close to the - I’m sorry, go ahead..

No, no. That’s fine..

The pricing in this business, is it a unit cost or these fixed price projects including Magnus is cost plus?.

Yes. It’s both. Like the mining project, it’s a time and materials basis, other projects we take on are fixed cost, some are fixed unit. So it’s across the board actually John..

All right. That’s great.

And lastly, you touched on a little bit but in terms of the work on the Gulf Coast related to the BP, bill and restoration, your thoughts there - I don’t know what’s your people watched down the Gulf Coast are same, when might - can you give us a time sort of possibilities on that?.

It’s really hard. I mean we all know that the second ruling came in for the Judge. So now it’s really, is BP going to go full bore fighting it or come to some negotiated settlement. I guess as the Judge rules in 2015 on the final phase of this, so certainly close to explain but it’s not there yet, John..

Oh and I’m sorry.

And when do you expect result from Savannah River to be released?.

I can’t answer you that. The Amicor - is the Amicor, so we really don’t know..

Okay. Thank you..

I wish I could help you..

Thanks..

Thank you. [Operator Instructions] And our next question is a follow-up from the line of David Olkovetsky from Jefferies. Your question please..

Hey, thanks guys.

Just want to make sure I’m not missing any cash outflows in 2015, do you mind just going through anything other than the ATB, your generic CapEx and any interest payments and I think you said cash taxes are going to be zero, is there anything else that I’m missing in 2015?.

No. Those are the big pieces..

Okay.

And then are there any major contracts that are coming off in the next quarter?.

Just the international East Hidd as Jon mentioned, we will wrap up at the end of first quarter..

Sorry, international which one?.

The East Hidd..

In the press release we have mentioned we are finishing up $35 million East Hidd project in Bahrain..

Okay..

So we will finish that project. But, we have contracts that we work on and off all the time. So I mean it’s our job to - it’s our job to get the dredge or get the piece of yellow equipment right on the next project as soon as we can. So yes, but East Hidd is the only one I think that we flagged deal..

Got it. Okay.

And then with respect to Magnus, I think at the time of acquisition, you guys were talking about $90 million backlog I think to them, the call is something like 54, if I’m remembering correctly? Do that 30 plus million dollars piece that you guys mentioned in the press release today is that - was that originally included in the 90, is that what happened, why there is a decrease?.

Yes. It’s just how they categorize backlog is different than we do..

Okay. You guys are little conservative, is that -.

Yes. I mean this is a third phase of a project they worked on. They have a Master Service Agreement, but we wouldn’t in our [indiscernible] that we would not include as backlog until the past quarter is actually handed out. And we are negotiating that task order right now. So that’s the difference..

Okay.

And then just to drill down a little bit more on the environmental side, so you guys are talking about that like it’s going to be a very significant growth opportunity, which I get I mean it’s fantastic, I just want to understand, what’s the sort of the timeframe you envision for increasing your business in the warmer parts of the U.S., I assume this is primarily going to be in the U.S.

or are there additional geographies that you are looking at to combine -.

I mean excellent question. I think 2015 and 2016; we really do want to focus on expanding into the warmer weather, so we can balance our work load and our equipment. That being said, we are not necessarily positioning ourselves and trying to get ahead of skis on the international side.

But, we do look at ourselves as someone that can take this business internationally where no other environmental contractor of size has the capability to do that with U.S. companies. And I think longer term we do expect that there will be demand for environment where big U.S.

multinationals going different places, the mining industry, the oil and gas industry. And if you talk to some of the competitors that are in this business, they don’t have capabilities to do that work overseas. So I look at specifically in the Middle East as an example where we have a base operations, I have people.

I have knowledge of how to be there that longer term that something we are certainly going to explore. But, our theme for 2015 and really 2016 is to fill out the U.S. get it integrated, run it profitably and then we will go after that..

Okay. And then sorry, I just have a few more if you don’t mind..

No problem..

Okay. Thanks.

In terms of working capital in 2015, are you guys anticipating any unusual momentum?.

No..

And with this ramp up in the environmental business, is that going to be a cash outflow associated with that, is there - I mean just - try just walk us through working capital -your working capital thoughts..

So from - I mean like Jon said earlier, in the environmental we have already made a lot of these investments in three locations in the U.S., so that’s kind of already baked into the numbers you saw in 2014, those costs, so talk about maybe opening one more office in the Southeast that would be not - wouldn’t be that material.

But, the rest of the infrastructure, we have kind of already built into the numbers. So there is no really unusual type of working capital items outside of the normal operations..

And but what you will see is, use of capital in Q1 and Q2 as the work ramps up..

Sure..

And then being significantly cash flow positive in third and fourth quarter..

Okay.

And then just on that vain in terms of cash flow, I don’t know if you guys are willing to go out there and say it yet, do you think the 2015, you will be free cash flow positive?.

We don’t provide guidance on that, sorry..

Thought I would just ask. Thank you very much and good luck again..

Thanks..

Thank you..

Thank you. [Operator Instructions] And our next question comes from the line of Larry Callahan from Wheelhouse Securities. Your question please..

Yes. Hi.

On your last conference call, I think you mentioned the possibility of refinancing your outstanding bonds, do you have any thoughts on that currently?.

So we had a step down on our senior notes in February, the market - didn’t make financial sets, market wasn’t that favorable. We have another set down in February of 2016. So again, we kind of walks the market in the interest rate until it makes financial sense it haves in yet at this point. So we just continue with it.

So we haven’t done anything related to those notes at this point..

And Larry, as you can imagine, we constantly look at it and have to just measure whether extending amount of the ad rates that we can get right now is worth the investment. But, we look at it on a very regular basis, we stand top of it. And we will continue to do that..

Thanks..

Yes..

Thank you. Yes. This does conclude the question-and-answer session of today’s program. I would like to hand the program back to management for any further remarks..

Thank you. We appreciate the support of our shareholders, employees and business partners. And we thank you for joining us in discussion about important developments and initiatives in our business today. We look forward to speaking with you during our next earnings discussion this spring..

Thank you, ladies and gentlemen, for your participation in today’s conference. This does conclude the program. You may now disconnect. Good day..