Randy Harl, president and chief executive officer, commented, Our business model has generated substantial cash over the past 15 months, and has provided us the flexibility and financial resources to execute our vision and strategy to transform Willbros into a significant global participant in the engineering and construction industry, providing recurring services to both upstream and downstream markets, as well as performing capital projects. As we move through this challenging period for the industry, we expect to emerge an even stronger participant, with a more efficient, diversified and services oriented model.
Our recent progress in establishing an alliance agreement with NiSource Gas Transmission is an example of the opportunities in our traditional markets. While we continue to believe the long term fundamentals for our business are positive, we are aggressively reducing the cost of our operations which enables us to offer our customers lower pricing while maintaining acceptable margins. This allows us to align our costs in a manner that is consistent with the short term scenario that will require us to operate at reduced levels relative to 2008, while providing our customers with cost-saving solutions that meet their needs and optimize our results.
First Quarter 2009 Continuing Operations
The 6% decline in revenue was due mainly to lower levels of activity in our engineering segment, which benefited from the more robust engineering, procurement and construction (EPC) activity in the first quarter of 2008. The decline in engineering activity was somewhat counterbalance by a raise in the upstream segment.
During the first quarter 2009, Willbros incurred severance charges, related with right-sizing its operations and administrative activities, of $4.7 million.
Backlog:
At March 31, 2009, the company has reported backlog from continuing operations of $543.9 million compared with the $655.5 million at December 31, 2008. At March 31, 2009, about 63% of backlog was cost reimbursable contracts.
