Good day ladies and gentlemen and welcome to the Q1, 2012 Orion Marine Group Incorporated Earnings Conference Call. My name is Allison, and I’ll be your operator for today. [Operator Instructions] As a reminder; this call is being recorded for replay purposes. I’d now like to turn the call over to Christopher DeAlmeida, Director of Finance. Please proceed, sir.

Good morning, and welcome to the Orion Marine Group First Quarter 2012 Earnings Conference Call. Joining me today are Mike Pearson, Orion Marine Group’s President and Chief Executive Officer; and Mark Stauffer, our Executive Vice President and Chief Financial Officer. Regarding the format of the call, we’ve allocated about 15 minutes for prepared remarks in which Mike and Mark will highlight our results for the quarter and update our outlook for 2012. We will then open up the call for sale-side analyst questions for the remainder at the time. During the course of this conference call, we will make projections and other forward-looking statements regarding among other things, our end markets, revenues, gross profit, gross margin, EBITDA, EBITDA margin, backlog, projects and negotiation of pending award as well as our estimates and assumptions regarding our future growth, EBITDA, EBITDA margins, gross margins, administrative expenses and capital expenditures. These statements are predictions that are subject to risks and uncertainties, including those described in our 10-K for 2011, that may cause actual results to differ materially from those statements. Moreover, past performance is not necessarily an indicator of future results. By providing this information, we undertake no obligation to update or revise any projections or forward-looking statements, whether a result of new developments or otherwise. Also, please note that EBITDA and EBITDA margin are non-GAAP financial measures under the rules of the Securities and Exchange Commission, including Regulation G. Please refer to the reconciliation accompanying this earnings call available on our website at www.orionmarinegroup.com for comments on the use of non-GAAP financial measures, as well as applicable reconciliation’s to the most comparable GAAP measures. Also, please refer to our earnings release issued this morning, May 3, 2012 and our quarterly and annual filings with the SEC, which are available on our website for additional discussions of risk factors that could cause actual results to differ materially from our current expectations. With that, I’ll turn the call over to Mike Pearson, President and CEO, Mike? J. Pearson: Thank you, Chris and thanks for joining us this morning. Despite the challenges of the first quarter, we continue to see positive results from our adjusted bidding philosophy in the form of improved win rates and our continued sequential increases in backlog. We are encouraged to see that pricing has stabilized and the irrational bidding that we’ve seen in prior periods has begun to subside. The strategy that we’ve began to implement during the third quarter of last year is continuing to yield the desired results with increased backlog for the fourth consecutive quarter. We’re pleased to see a continued strong private sector market. During the quarter we bid on and won several private sector opportunities, including the award of a large multiple dock construction for a liquid bulk terminal. This level of activity gives us optimism about the private sector, both near and long-term. However, there is no doubt we still face many challenges and we’re still in for a few rough quarters. That said, things are beginning to move in the right direction. As we’ve said before, getting our large dredges back to historic utilization levels is the quickest way for us to return the higher profit margins. And during the first quarter we began to see some of our dredging equipment come off-line again as a result of the lack of Corp lettings since the beginning of the fiscal year. This will result in more idle equipment during the second quarter. However, there were limited bid lettings during the quarter and we were able to secure an indefinite delivery and definite quantity or what’s referred to as an IDIQ contract with the mobile district of the Corp of engineers that should put some dredging equipment back to work beginning this summer. Additionally, we are beginning to see the pace of Corp lettings improved. That’s encouraging, though we have to keep a close eye on this activity levels over the next few months. Also, there remained potential legislation that could help us see additional opportunities in the future. First, the resolution of a long-term highway build by Congress would help ease some of the competitive pressures that we’ve seen from smaller non-traditional marine construction players that have entered our marketplace. As we’ve said before, we do not expect the passage of a highway build will significantly add to our project track and database. However, we do expect this to be a factor in the easing of pricing pressure. The smaller, non-traditional marine construction players returned to their normal market areas, and visibility to large, long-term infrastructure projects improves. That said, we don’t expect to see a long-term funding bill passed until after the election. We do expect to see continuing resolutions to keep the funding steady. While this is good, it didn’t help alleviate the current pricing pressures in the market place. Additionally, resolution to the Harbor Maintenance Trust Fund issue could help provide the necessary funds for harbor maintenance and expansion projects. The good news is, we’re seeing positive momentum for some resolution on the Harbor Maintenance Trust Fund issue. In fact, the House was successful in passing a highway bill expansion that included in amendment, which would remedy the Harbor Maintenance Trust Fund issue by matching the level of trust fund expenditures with the level of revenue that the fund takes in every year. The bill has been sent to conference in the Senate and it will be debated further. And while the legislative process is always uncertain, we’re certainly encouraged by the positive movements recently and we are hopeful that this legislation will pass over the next year or so. As we look at the market as a whole, we continue to see strong signs of demand for our services that has not and will not go away. In fact, we continue to believe there is a building pent-up demand for projects that involve dredging services, and ongoing demand for marine construction projects. According to the most recent data from the U.S. Census Bureau, the United States continues to export and import at high levels. The first 2 months of 2012 saw exports increase by 8.3% over the same period in 2011. Additionally, the first 2 months of 2012 saw imports increase by 4.1% compared to the first 2 months of 2011. It was also reported by [indiscernible] that 18 of the top 20 container ports in the United Stated reported gains in the level of cargo handled in 2011 versus 2010. Those levels of water born commerce continue to increase so, we need to upgrade and improve and maintain our nation's marine infrastructure. Now today we’re tracking over $6 billion worth the bid opportunities for the next few years. And of that amount, a 11% of federal projects, 27% of state, 21% of local, and 41% are in the private sector. This high level of activity in our tracking database gives us optimism about the overall market demand. However, close attention has to be paid to pricing and funding to see how these opportunities will ultimately play out. In closing, our strategy to rebuild backlog is working. Our win rates are up, our book-to-bill ratio for the quarter is the highest it’s been since the third quarter of 2009, over 2.5 years ago. We are controlling our overhead costs and working to reduce the impact of underutilized equipment. We believe a strong market fundamentals exist to support to return to profitability. Maintenance of our nation’s waterways is of great economic and strategic importance. Neglect of vital transportation routes will only hamper our economic recovery. So the expansion of the Panama Canal and the larger ships that will transit through to the Gulf and East Coast ports will necessitate expansion of these facilities over the long-term. There is no doubt the challenges that we faced in 2011 have persisted into 2012 and there will be a difficult quarters ahead. However we put a plan in place and we’re beginning to see it work. We’ll weather the storm, we’re focused on returning to profitability. We are beginning to see some encouraging signs on multiple fronts that we must execute on our projects, protecting intrinsic value of the company and return value to the shareholders. We believe Orion Marine Group has a strong and bright future and we are working hard to build our backlog and maintain a strong balance sheet, increase our margins, and explore complementary, but diversified service offers. And with that I’ll turn the call over to Mark Stauffer to discuss our financial results in more detail, Mark?

Thanks, Mike, and thank you again for joining us. For the first quarter 2012 we reported a net loss of $6.3 million or $0.23 per diluted share, which compares with a $1.5 million net income or $0.06 per diluted share in the prior year period. First quarter contract revenues decreased 36% year-over-year to $50.9 million, of which 62% was generated from federal, state and local government agencies and 38% from the private sector, which compares to 74% from federal, state and local government agencies and 26% from the private sector in the prior year period. During the first quarter of 2012, our book-to-bill ratio which measures the replenishment of our backlog was 2.0x, which is up from the first quarter 2011 book-to-bill ratio of 0.3x. Our heightened book-to-bill ratio is evidenced that we are making strides in executing our strategy to rebuild backlog by strategically adjusting margins. This is the third consecutive quarter our book-to-bill ratio has been above 1.0x and we believe we have a good handle on where pricing should be in order to win work. During the quarter, we bid on approximately $420 million worth of opportunities and we are successful on approximately $100 million. This represents a 24% win rate, which is on par with our historical norm. As we look at the next 12 to 18 months, we expect to continue to see strong market opportunities for marine construction projects, however, with continued margin pressure. On projects involving dredging services, we are still optimistic that lettings will pick up as we enter into the summer months and the back half of the Corp of engineers fiscal year. As Mike mentioned, we are also encouraged by the potential congressional activity to finally match Harbor Maintenance Fund expenditures with the amount collected by the Harbor Maintenance tax. Turning to backlog, as of March 31, 2012 we had backlog of work under contract of $215.4 million of which 25% is for federal projects, 24% is for state projects, 19% is for local projects, and 32% is in the private sector. Subsequent to the end of the quarter, we have been successful in continuing to obtain additional awards for new work, although at pressured margins. We continue to monitor and execute cost containment measures implemented during 2011 in order to control cost and right size the company to the current market conditions. During the past year, we developed and implemented programs that focus on controlling costs associated with idle crews, non-essential repairs and overhead costs. We are pleased with the progress we have made in this area. The programs we’ve developed should help limit the impact of idle crews and equipment once they are no longer being charged to a specific project. Keep in mind, job margins have been pressured, so we will still expect to see pressure on gross margin as compared to historical norms. Our goal is to offset that pressure as much as possible through continued cost containment measures. While we are seeing signs of improvement in the market, significant challenges still exist primarily, the lack of Corp lettings and their impact on the utilization of our dredging assets. We believe the obstacles we face are short-term in nature and we expect to -- an eventual return to normal market conditions. We are executing our plan to build backlog, contain cost, manage through this downturn and position ourselves to take advantage or return to more normal market conditions. As we look ahead, we remain excited about future bid prospects and the strength of our end markets. We believe the market combined with our specialized fleet workforce and support facilities position us to be a leader in the market for this foreseeable future. Much of the waterways infrastructure in the U.S. needs repair, improvement or replacement and we believe this work will be accomplished over time. We have solid long-term end market drivers that give us confidence in the future ahead. With that, I’ll turn the call back to Chris to begin the Q&A portion of this call.

Thank you, Mark and Mike. We would now like to open up the call for questions.

[Operator Instructions] Your first question comes from the line of Min Cho of FBR.

Just let me get a clarification. Mike you mentioned that pricing has stabilized and Mark, in your commentary you mentioned that you expect to win new work -- there's continued margin pressures. I’m just wondering are you talking more versus the historical basis or margin pressure versus where projects are being bid now? J. Pearson: Basically, we’re talking about, we’ll stabilize the level that we’re comfortable with that we’re able to achieve the low bidder status. and I'm glad to see that it’s not moved any lower. And I think we've got a margin level that with our cost containment strategy that we can move into a profitable run rate. But there are key now is to get our utilization up on the big dredges.

And I think again, Min we’re putting that in context of historical levels. [Technical Difficulty]

Sorry, we seem to have lost that line there. [Operator Instructions] Our next question comes from the line of Matt Tucker with KeyBanc Capital Markets.

First question, I was hoping to get a little more color on a couple of positives trends you mentioned, the irrational bidding starting to subside, and then starting to see Corp lettings pickup. What would you attribute those trends to? J. Pearson: Well, I think what we’re saying that we’re not seeing the people coming in with as ridiculous of pricing on every bid document that comes out. It’s random, there’s still a few, but the pack of prices are kind of tightening up and we’re seeing a more reasonable range of bid results. And I think that’s just a good indicator that things are beginning to stabilize, and we’re not having to push down any further on our pricing, which we've been testing and trying to get it pushback up, and I think we’re enjoying some success in that. So that’s best I can.

Yes. And I think just further on to Mike’s point there, Matt I think that again, as we look at where we really saw all that. Starting 2010 on in 2011, just speculating on that, I think that a lot of people filled up on some very cheap work, and I think that kind of started working itself through the system. And I think somewhat that’s where we’re seeing is that people are kind of getting back to reality a little bit. And again, we’re not to where we want to be historically, but we’re seeing less of that. And I think that’s indicative of just people building up on some cheap work and so they’re adjusting their pricing. And then I think that’s again indicative of our win rate improving, and of course, our book-to-bill. With respect to the Corp of engineers, I think the thing that gives us hope there is clearly that the Corp has got a budget in place -- that was put in place at the end of December, as we noted on our prior call and government agencies liquidate their budgets. So we fully anticipate that the Corp would liquidate its budget before the end of the fiscal year, meaning that they will submit the projects before September 30. And so that’s why we believe we’ll see an up tick in bid opportunities as we move through the summer months.

Okay, that’s helpful. And to follow-up on the Corp lettings, I know that you had a budget in place for a while where you’ve been kind of scratching your head and wondering why the lettings have been so slow. In your discussions with your contacts at the Corp, have they given yet any explanation on why the pace has been so slow, and have they explicitly told you that the pace will be picking up soon? J. Pearson: Yes. We’re get an indication that pace is going to pickup in the summer here and we’re already starting to see some signs of up tick with lettings coming out for May, which we’re glad to see. But one factor in there is that this is the time of year where the change of command takes place at the top level, the Corp commander all the way down to the districts. So we got new personnel taken over each one of these districts, it takes time for them to get into play and get adjusted. We expect things to start kicking open here pretty soon.

And as a pace of lettings does pick up, I mean are you going to see opportunities for work that you could work off in 2011 i.e., will contributed to this years results? J. Pearson: 2012, yes…

Sorry, [indiscernible].

Yes, just as a reminder and again this is a general rule so there is exceptions to it. But generally speaking, the dredging projects particularly Corp dredging projects have a relatively fast start. So to the extent, we can get some awards that’s very possible that a substantial portion of any projects we pickup would be liquidated in 2012.

We now have Min Chung Cho, back on the line.

Great, sorry about that. So actually I just had one final question. Can you just give us a status -- actually 2 questions, sorry; status of your recent project awards. I know the bridge replacement project in Charlotte County, Florida and the berth construction at the Canaveral Port Authority were both supposed to start kind of early in 2012, I want to know if those in fact have started as well as the shipping and barge docks in Gulf Coast?

All of them were started, they’re in various stages of starting and as we kind of commented previously, there is various stages of ramp up in terms of what activity is going on there. So again as we said previously, we expect there is really to get ramped up in the third and four quarter, but we are beginning to do work on each of those projects.

Okay, great. And then here is my final question. Regarding the IDIQ award for the U.S. Army Corps in the Mobile District, are the IDIQ, is that a trend that we should expect to continue going forward and is there any thing from that IDIQ in backlog currently? J. Pearson: Yes, there is nothing new about the IDIQ. Some districts like to use those where they get kind of undefined scope, but they’ve got a work list of items that need to be accomplished, and they want to be flexible as to how to prioritize it. And the way we -- it was a bid that the bid submitted was somewhere around about $16 million, but we did not recognize all that revenue until the task orders are issued. They just are in the process of issuing the first task order, and it could go up as to the full amount of $50 million possibly. But it’s hard to determine how much of that will liquidate this year, it’s just on a task order basis, but it’s not uncommon.

And keep in mind, as we -- I think we mentioned this on the last call or in the press release we will not, none of that is in the backlog that we reported as of March 31st. That will come in the backlog as individual projects are released under that IDIQ.

Okay. And then IDIQ the 14 month contract did that start after the first task order is received, or did that start in March when the announcement was made? J. Pearson: Well, we got the go, but the task order did not get issued until this month, and it probably would be June before we get over there and really get kicked off going so.

So, it will go end of the first half of next year. J. Pearson: Right.

Your next question comes from the line of Jack Kasprzak of BB&T.

The comment -- I just want to ask about the second quarter specifically, because there is a comment in the press release about expectation in second quarter could be pressured compared to the first. I mean, would you care to offer some commentary in terms of order of magnitude or we kind of finding a bottom here in terms of margins and the pressure on the margins and we build up from the second quarter. J. Pearson: One factor there is that, we did have dredging activity in the first quarter of the year, and we expect that with this gap in the bid letting, it will be less utilization of our major dredges in the second quarter, so there will be some impact there as a result.

Right, and Jack its tough to get more specific in terms of order of magnitude. As you know, we’re not providing guidance but I think, to Mike’s point is, again as we said in our remarks and in the release with some of the equipment that we had occupied in the first quarter becoming idle again, you get into the situation where you have gaps in your projects. Again it's encouraging that we’re starting to see some opportunities pop-up on the bid list, but partially it's dependent on whether or not any of those are in time to have any impact on the quarter or not. So I think as we’ve said, it’s not unreasonable to expect that we might see pressure on the bottom line as compared to Q1. However, that doesn’t take away from anything that we’ve said with regard to the second half of the year and some of the things that we’ve talked about there with respect to the backlog that we currently have in hand and those projects ramping up.

So if the -- I guess similarly, Army Corps lettings pick up prior to the end of the government fiscal year, that’s part of the reason why we think maybe the second half, at least compared to the second quarter may be is worst than the first, starts to look better? J. Pearson: That's correct.

Okay. And from the end of the year to the end of the first quarter, some cash moved into restricted cash, can you just talk about the mechanics of that or what happened to cause that? J. Pearson: Yes, absolutely. As we mentioned in our 10-K, during the first quarter, we purchased some property that we previously have been leasing over in Florida. We’ve partially been leasing it. We viewed it as an opportunity to expand and increase our yard capacity as well as, to potentially provide us some opportunities for diversification. And under our credit agreement, obviously with the current environment we’re in, it's a technical requirement under our credit agreement given the fact that we had a covenant, but given the current environment. But we do think this is temporary, I mean we’re working; our banks are supportive, now as they understand the environment that we’re working in right now. And we’re working with them right now on a substitute alternative to that, cash being restricted, and we anticipate that will be resolved during the second quarter.

And I guess, little tough period here and given that factor, there’s a small draw down on credit line, I mean if that, do those kind of go together and if you... J. Pearson: Yes, definitely.

Get a little relief there. J. Pearson: Yes. They had, they go hand in hand. I mean we drew on the revolver to purchase the property. And as a result, again, a technical requirement in the credit agreement, it requires that cash set aside. And again, we’re working too with the banks to eliminate that restriction and we should have that completed here in the near-term and we certainly think by during Q2 that will be resolved.

Your next question comes from Trey Grooms with Stephens.

A couple of questions, one kind of following up on the 2Q discussion you have there, looking for earnings kind of lower sequentially possibly, but is that on lower revenue as well or just we’re just thinking about the additional margin pressure from these idle dredges. J. Pearson: Well, again it’s tough to get specific as we’re not providing guidance, but I think it’s a matter, it’s more a function, I think the 2 thing is going on, and we’ve talked about is one, we are beginning to ramp up on some of the work that we have been successful bidder on and is in the backlog. So we’ve got that going on, but the headwinds of that is the dredge utilization and the gaps that we have in the schedule for that equipment. So you’ve got kind of 2 competing things going on there and that’s why we say that’s it’s not unreasonable thing that we’ll see some pressure there as compared to Q1.

Right, and you just kind of specifically pointed to some pressure on earnings, really just what I’m trying to get at is, should we expect additional margin pressure sequentially or can we see the top line move down as well? J. Pearson: Less top line and more utilization.

Okay. And looking at the kind of margin potential a little bit longer term looking out, I am not asking for specific guidance necessarily. But how do we think about kind of margin potential once we start to kind of see some of these equipment, some of these dredges and so forth get back to work given kind of the new pricing approach. Where could we kind of think about, how do we kind of think about margins a little bit longer term?

Well, I think the way we think about it is again we think step one, is like we talked about and Mike mentioned in his remarks where we think we’re seeing pricing stabilize. So that’s kind of the first part. The second part is seeing dredge utilization pick back up, and if we can get that happen and kind of minimize some of the gaps in the utilization of the dredges and get them moving back towards a more normal or historical utilization point. Then we think that we could definitely be at the bottom on with respect to margins and then start moving them up and it’s not unreasonable to think we get them in the single digits as we move forward and then build from there.

Okay, all right that’s helpful. And then Mike, you mentioned port expansions and there are a few things that are looking promising here in the short run some of those kind of getting started. Can you talk about any opportunity that you see for you guys out there on those projects? J. Pearson: Well bid activity on the marine construction side is just really very active right now. So we are very encouraged that there seems to be a quite a bit of opportunities whether it’s in the private sector, the oil and gas companies are expanding docks, I think we’re going to see more of these boat terminals like we just got awarded. The ports you’re talking about expand in their container terminal facilities. And the Gulf Coast has been very active along those lines and we’re still pursuing a lot of bridge work, and in spite a lack of the highway bill, there's still been bridge replacement work taking place, and we continue to add that to our backlog. That’s a good base to build on. And I just feel real encouraged this Panama Canal is going to be a real catalyst here as we all hoped it would be. And we’re starting to bid on projects now for that purpose. I think you’ll see some smaller port development expansion because they realize that dredging of the channels for these deeper ships are just not won’t be ready when that canal opens. And there is just quite a good level of activity going on at the bid stage.

And on that, so it sounds like as far as port expansion goes for you guys, do you see more opportunity, it sounds like you might see more opportunity on the construction side than on the dredging side? J. Pearson: Well, the bid level activity is more robust on the marine construction side. But I think on the dredging side that the key there is just the Corp start flowing at a normal pace. There’s a lot of discussion going on about how to get the Corp properly funded, I think Congress now realize is that the Corp just is inadequately funded to meet the needs of this Panama Canal ship traffic. And they commissioned a study with the let’s call the Institute for Water Resources to report to Congress in June as to what are going to be the funding needs long-term to get these channels widened and deepened to accommodate Panama Canal ship traffic. So we’re anxiously awaiting that and I’m sure it’s going to say, "Hey what’s you’ve been given the Corp all these decades is inadequate, and you’ve got to pump up the volume." And it’s going to be interest to see how that plays out with this budget debate. But surely the Harbor Maintenance Trust Fund can be an easy solution that does not increase the debt. It just uses the money’s in the trust fund. And we think there’s just a lot of good indicators there that could get dredging back on track again, and it’s been a very unusual 18 months watching not much dredging take place.

And Trey, I guess it is reasonable to think too that we would see more of the construction activity be active while as you know the federal government is responsible for the deepening and widening of any ship channels. And so while that budgeting and funding for that get sorted out. We do expect to see some of these ports -- in fact many of these ports have expansion projects in the design phase right now. So we do think that that’s probably would be a little bit ahead of the dredging projects coming out.

Your next question comes from the line of Tristan Richardson from D.A. Davidson.

In terms of your optimism for the utilization in the second half, is that just looking at only the business you have in hand now with the improved backlog, or is that also somewhat predicated on your cautious optimism that you’re seeing the Corp lettings improve, I guess…? J. Pearson: It’s both. I mean we are going to need to capture more work in the second half from what we have in our backlog. But I think our ability to do that is there. Historically we’ve been successful on the dredging side, and my guys has just been so quiet with the Corp -- in the first 3 or 4 months here that they got a lot of catch-up to do, get all of that budget out the door and committed. So I think it should be real active period for us and…

And definitely with the lot of the backlog we have and I mean we do expect with that backlog in hand that a lot of the barges and cranes and things of that nature will be that we will see a marked increase in utilization. So definitely the expectation in the second half related to further utilization of the dredge asset is dependent upon the Corp activity in large measure. Obviously, there is some things going on with the private size with respect to the dredging opportunities. But by and large, I mean the Corp is the biggest driver of being able to get the dredge fleet utilization where we wanted to be.

Okay. And in terms of your backlog now, can you give us a general sense of how much is 2012 work and/or versus 2013 if there is a proportion that of what you have now that would be worked off next year?

We are beginning to build backlog for next year. I would say that most of the work that we have in hand or in backlog right now liquidates in the current year, but we are starting to build a nice amount of that for next year as well, but the majority of it will liquidate this year.

Your next question comes from the line of Richard Wesolowski of Sidoti.com.

How many of your primary 9 I think it is, cutter suction dredges are currently working on projects?

Well, we don’t give utilization for competitive reasons, but I think it’s fair to say that we are -- have been well below on a historic utilization rates. We saw that pickup in the fourth quarter last year. And again, as we moved into the first quarter this year, as projects completed and with the lack of letting not having new work to go to that, we saw that pull back but, and again, we made the comments about how we feel about Q2, but we don’t give specific there just for competitive reasons.

Okay. Your backlog $215 million is fast approaching the records set in early 2010. Since then you’ve cut by memory 20% to 25% of the workforce. Are you already adding to your field crews or are you processing the recent backlog and whatever you build since then with only the people that survive the cuts. J. Pearson: Well, we are going to be adding to our workforce. We have made some substantial cuts and reduced personnel both in overhead and in the field. So we are going to be hiring and we’ll be bringing back in some additional staff as well to manage the work. So that’s all part of the process. We went from 1,400 down to a 1,000, quite a few people there to get back.

And it’s also a possible that, we might be hiring in some areas and have some offsets elsewhere. We stabilized around the 1,000 headcount for the last few quarters, and we think that’ll -- we seem to have bottomed out there. But we certainly in some of the areas with the backlog we have -- in some areas we’ve already added folks, in other areas we will be adding folks. And in the balance of that’s going to be dependent upon the dredge utilization and winning some of these work we see coming out and getting that utilization back up.

When management says that the company is not bidding work below costs, you are not necessarily saying you expect the job to be profitable on a company wide level or add gross profit, you’re talking about your direct marginal cost to complete a project, correct? J. Pearson: Correct.

That's right.

I understand you’ve lowered your bid margin during the past few quarters. But I'm wondering what you suspect you would have won under this pricing scheme a year ago, do you think you would have had similar bookings to December and March... J. Pearson: I know.

Even pricing here work a year ago at this level? J. Pearson: Not with the kind of pricing we saw, they were like 50% of what we were bidding.

Exactly, exactly, I mean that's why we say, Mike said this earlier that. J. Pearson: We're not going to do that.

Yes. We're not going to do that. And we were -- we didn’t do it and even if we had adjusted back then -- with the amount of irrational pricing we saw. I mean we might have seen an incremental increase in our win rate and whatnot, but nowhere near historical norms is because of the irrational bidding was just so rampant and off the wall that. and again, that's the positive thing that we’re seeing, we’re seeing much less of that, we’re just seeing the odd job here and there. And so that's encouraging to us. J. Pearson: Yes. I’d say we saw some bidders on some of the bigger project to leave $50 million, $60 million on the table, just crazy. I don’t think we’re seeing that now this year so far, not to that extent, but lot of panic took place in 2011.

Right. Lastly, considering the absence of financial risk for the company is most valuable to sureties that investors during today’s difficult business conditions. I’m curious about the timing of the building transaction, you still have great balance sheet of course. But with the return on the investment so great that it needed to be done or was there some other factor that created a sense of urgency around the timing?

Well, yes, there’s sometimes timing is not of your choosing and sometimes when opportunities come along, you have to seize them despite conditions and we felt that was important to... J. Pearson: Strategically important.

Exactly, and again, obviously we are still committed to protecting the balance sheet and preserving cash and focusing on cash and protecting the balance sheet. But as we’ve said, there are certain times where opportunities come around and you have to kind of seize them or they’re not going to be there again. So we felt that was a reasonable transaction to complete even in these tough times.

If you were, I know you touched on earlier in the call; this is the last one from me. Review perhaps in a little more detail what the ownership of that building brings to you from a cost reduction or any other strategic perspective? J. Pearson: Well, one aspect of it is that we consolidated our operations on the dredging side and the marine construction side and this kind of fit with that well. There is not much waterfront property available in port areas, on the western side of Florida. This is some of the last of that property. It was good to be able to lock that up. We’ve been leasing it for some time. And we just feel like that’s going to be important to our expansion plans down the road to have that property -- owning it as opposed to leasing it and possibly losing it, so…

The other thing that does for us as we said in our remarks is it we believe or as I’ve said earlier I think, it provides an opportunity for diversification. It’s premature talk about that any further. But we think with that addition and the property we have in that area already that it provides us with an opportunity for diversification and that’s why we felt it was important to do.

And your next comes from Matt Tucker, KeyBanc Capital Markets.

Just a few follow-up questions. While I realize that you’re not providing guidance, you have been talking about ramp up in the second half and the growth in your backlog would seem to support that. Could you provide any little more color on kind of the magnitude of that ramp up, in particular do you think it will be profitable in the second half? J. Pearson: I think that again it’s tough to answer that question because we’re not giving guidance. As we said in I think both our remarks and on our calls previously, we’re in for some rough quarters. Obviously, our number one focus right now is to first get back to a break even and then start positive run rate again. When that exactly happens, it’s tough to say. Clearly one of the big variables that we have right now is the dredge utilization. Having said that, we are comfortable and/or we’re very pleased with some positive things that we’re seeing out there, with the private sector opportunities picking up, the backlog build that we’ve had, the book-to-bill ratio, it’s been very positive last few quarters. And the pricing stabilization and the reduction of irrational bidding is a big thing for us. So there is some positive things out there, but it’s difficult for us to comment further on when we might see that positive run-rate return.

Okay. And then, you indicated that you were the low bidder I believe it was $26 million, currently of your bids outstanding. I don’t know if you’ve won, worked this quarter already outside of that, but it would seem to suggest a bit of a slow-down in the pace of bookings versus the first quarter. How much should we read into that and could you talk just a little bit about in your expectations for bookings in the second quarter?

Well, keep in mind that, not all projects are large projects and the timing of things that can fluctuate and be lumpy if you will. But again -- the short answer is, we don’t read anything negative into that at all. As Mike said earlier, we’re very actively bidding on a lot of fronts. We’re encouraged that the -- we expect to see an uptick in Corp lettings as well as we get through the summer months and they liquidate their budget. We’ve got a lot of bidding activity going on again, we’re always kind of subject to the timing. But the -- of when things get awarded and things of that nature, but bid activity remains very high and so we’re encouraged about that. We’re encouraged that we’ve got foundation out there if you will to start climbing out of the hole and get the bid margins back up as much as we can and again, ultimately down the road get them back to historical norms.

I’d now like to turn the call back over to Christopher DeAlmeida, Director of Finance for closing remarks.

On behalf of Orion Marine Group, Mike, Mark and myself we thank you for joining us this morning, and we look forward to speaking with you in the future. Also if you have any follow-up questions please feel free to get me a call. Thanks and have a good day.

Thank you for your participation in today’s conference, this concludes the presentation. You may now disconnect and have a good day.