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Original Source: FD (FAIR DISCLOSURE) WIRE
OPERATOR: Ladies and gentlemen, thank you for standing by. Welcome to the first quarter fiscal 2008 earnings conference call. At this time all participants are in a listen-only mode. Later we will conduct a question-and-answer session. Instructions will be given at that time. (OPERATOR INSTRUCTIONS) As a reminder, this conference is being recorded. I would now like to turn the conference over to Andrew Schmitt, CEO and President. Please go ahead.
ANDREW SCHMITT, CEO & PRESIDENT, LAYNE CHRISTENSEN COMPANY: Thank you, Mary. Good morning, everyone. I'm here with Jerry Fanska, our Chief Financial Officer, and we'd like to welcome you to Layne Christensen's first quarter conference call. Earlier today we issued a press release outlining the results for the first quarter ended April 30, 2007. Before we discuss the financial results, I'd like to remind the participants that the call may contain forward-looking statements that are subject to the Safe Harbor statement found in today's press release. Jerry will take you through the financial results and I'll give you an overview of division operating performance and how we see things going forward. Jerry, do you want to hit the numbers?
JERRY FANSKA, CFO, LAYNE CHRISTENSEN COMPANY: Thank you, Andy. Good morning, everyone. Revenues for the first quarter set another quarterly record, up 28.6% to $201.6 million from $156.7 million in the prior year, reflecting increases in all the Company's divisions. Water and wastewater infrastructure increased 31.5% for the quarter to $153.5 million, driven mainly by acquisitions in the prior year, increases in revenue primarily from the Reynolds Atlanta-based operation, and the Company's water treatment initiatives. Mineral Exploration revenues increased 10.3% to $37.1 million, reflecting continued strong demand in the commodity markets and Layne Energy revenues increased 88.6% to $9.6, reflecting increased production from the Company's unconventional gas properties. As a percentage of revenues, adjusted gross profit, the definition of which is revenue minus cost of revenues excluding depreciation, depletion, and amortization, for the quarter was 26.9%, up from 25.3% in the prior year due to improved margins in the Water and Wastewater infrastructure and the Energy division.
Selling, general and administrative expenses increased to $29.4 million in the quarter from $22.4 million in the prior year, primarily reflecting increases of $1.6 million from the acquisitions completed last year, increased incentive compensation expenses of $2 million, wage and benefit increases of $1.5 million, and $535,000 in increased legal and professional fees. Equity and earnings of our affiliates in Latin America increased to $1.5 million in the quarter from $365,000 in the prior year due to the strong commodity markets. Depreciation, depletion, and amortization increased $3.3 million in the quarter from the prior year, associated with the addition of assets from last year's acquisitions and increased depletion in the Energy division. Interest expense was up $300,000 to $2.4 million for the quarter on increased borrowings from the prior year, mainly due to additional debt associated with the acquisitions. The income tax rate for the quarter was 41% compared to 47% in the prior year. The improvement in the effective rate is a result of increased pretax earnings and a reserve adjustment due to the resolution of certain tax contingencies in this quarter.
The net result for the quarter was a $0.52 per share earnings, another record compared to $0.30 last year. The Company is in the process of evaluating the balance sheet impact of financial interruption number 48, which is an amendment to FASB 109, Income Tax Accounting. As such, there will be some balance sheet-only reclassification entries as we finalize the April balance sheet over the next few days. Before these adjustments, which we believe will not be substantial, the Company's balance sheet reflects total assets of $574 million, stockholder's equity …