Higher staffing and business development costs led to a 7 percent drop in profits at Ecology & Environment during the first fiscal quarter, the Lancaster-based environmental services firm said Wednesday.
Despite a 3 percent increase in net revenues, E&E's profits slid to $697,000, or 17 cents per share, from $746,339, or 19 cents per share, a year earlier.
E&E's net revenues grew to $20.9 million during the quarter that ended in October, up from $20.3 million a year ago.
E&E said revenues from its Walsh Environmental subsidiary jumped 33 percent, coupled with a doubling of sales at its Brazilian business, which was linked to additional work on oil and pipeline projects. Revenues from commercial clients jumped 31 percent, mainly on wind energy and liquefied natural gas projects.
Those gains were largely offset by a nearly 20 percent drop in work on state projects, especially in Florida, Louisiana and New York, along with a significant drop in Superfund work, due to the completion of an Environmental Protection Agency regional contract in April.
Federal revenues were down slightly as some relief efforts from Hurricanes Rita and Katrina wrapped up, although E&E continues to be involved on some wetlands restoration projects along the Gulf Coast.