Page 99 - Annual Report 2016 - Cover & Divider Pages.indd

The preceding table highlights some key metrics for comparative purposes
year-over-year. As you can see, Net Revenue declined by roughly $1 million
largely due to the downturn in new construction and project delays and/or
cancellations. While we experienced an upswing in our Utilization Rate, which
is a measure of the percentage of labor charged to projects, this did not
translate into a higher Effective Multiplier. Essentially, FGM worked harder on
deliverables for projects with less net revenue earning potential.

Despite managing and lowering our Overhead expenses by nearly $500
thousand, we were only able to partially offset the decline in net revenue.
Accordingly, Operating Profit slipped to $228 thousand for FY 2016, generating
a meager 2.1% return on Net Revenue. This simple balanced scorecard of key
metrics offers a pretty solid synopsis of overall financial performance and is
widely used in the industry.

Page 2