Ecology & Environment’s first-quarter profits jumped by 57 percent as cost-cutting efforts, along with a steep drop in subcontracting expenses, helped offset a 6 percent dip in revenues.
The Lancaster-based environmental services firm said its sales were hurt by a drop in work from customers within the energy and mining industries.
E&E said its profits strengthened to $380,000, or 9 cents per share, during the quarter that ended in October, compared with $243,000, or 6 cents per share, a year earlier.
The company’s sales dipped to $34.7 million from $36.8 million. Excluding subcontracting costs, E&E’s sales fell by 3 percent to $28.9 million from $29.8 million.
E&E executives said the company was able to increase profits, despite lower revenues, because of cost-cutting efforts, which included a 10 percent reduction in administrative, marketing and technical staff during the previous fiscal year.
U.S. sales account for two-thirds of E&E’s revenues, and they fell by 7 percent, while foreign sales dipped by 4 percent.
The company, which in November said it was scrapping its current business software system, said its earnings would have been even stronger if not for a nearly $500,000 increase in expenses stemming from the decision. E&E said it plans to select and switch to a new software system by August.
E&E also said it spent about $1.6 million during the quarter to boost its stake in its Walsh Environmental Scientists & Engineers subsidiary by 9.6 percent, boosting its ownership stake in the Colorado-based business to more than 99 percent.