Odyssey Marine Exploration, Inc. (Nasdaq:OMEX), a pioneer in the
field of deep-ocean exploration, reported results for the fourth
quarter and year ended December 31, 2013.
Q4 Financial and Operational Highlights
- Total revenue increased 118% over the same year-ago quarter to
approximately $17.2 million, with the increase primarily due to SS
Gairsoppa silver monetization.
- Net profit was $10.8 million or $0.13 per share, as compared to
a loss of $0.9 million or $(0.01) per share in the year-ago
quarter.
- Total cash balance was $32.0 million at December 31, 2013
versus $10.4 million at December 31, 2012.
- Odyssey monetized 1% of its mineral exploration subsidiary,
Oceanica Resources S. de. R.L. ("Oceanica"), yielding $2.5 million
in cash in the quarter.
- Further validated the Oceanica mineral deposit with a
preliminary resource assessment based on extensive coring and
laboratory work that indicates the 50-year mining concession
represents a world-class resource with significant potential
commercial and strategic value. JP Morgan Chase is advising the
company on options for development of the deposit and maximizing
the value of the asset.
- Installed an advanced one-pass drill system on the company's
mineral exploration vessel, RV Dorado Discovery. The drill's
coring, vibracoring and reverse circulation capabilities give the
ship a unique ability to conduct extensive scout drilling and
resource assessment coring, adding to the ship's extensive suite of
mineral exploration technology.
- Commissioned an advanced custom 6,000 meter depth capability
deep search system that uses dual Reson 7125 multibeam systems
integrated into a custom deep-ocean tow body. The configuration
will be used for commodity shipwreck search and inspection
operations.
Management Commentary
"Our record revenue growth in 2013 and profitability in Q4
reflects our unique abilities to discover, recover and monetize
valuable undersea assets," said Mark Gordon, Odyssey's president
and chief operating officer. "In Q4, we monetized the majority of
the 61 tons of silver we recovered in 2013 from the SS Gairsoppa
shipwreck, which drove these record top and bottom line
results.
"Our Gairsoppa recovery operations set a record for the deepest
and heaviest precious metal cargo recovery from a shipwreck at a
depth of nearly three miles. During two expeditions to the
shipwreck in 2012 and 2013, we recovered nearly 110 tons of silver
from the Gairsoppa, representing more than 99% of the insured
silver on board. Our success with the Gairsoppa is strong
validation of our team's pioneering techniques and state-of-the-art
technology in deep-ocean exploration."
Greg Stemm, Odyssey's chief executive officer, commented, "This
past year was also an important year for the validation of our new
mineral exploration business that leverages our deep-ocean
exploration capabilities to discover undersea mineral deposits. I
believe that this segment of our business will continue to lead to
significant cash generation opportunities as well as long-term
value for shareholders. In 2013, we received $27.5 million in cash
from the sale of a minority stake in our Oceanica mineral deposit,
a project first reported a year ago."
Gordon added, "Earlier today we reported receiving a preliminary
assessment from an independent Qualified Person (QP) that evaluates
the mineral deposit controlled by our subsidiary Oceanica. The
technical report concludes that measured, indicated and inferred
phosphorite resources in the areas of the deposit tested to date
are estimated to be more than 505 million ore tonnes of high
quality phosphorite.
"We also recently reported news on the shipwreck side of our
business. Last week, we were awarded an exclusive contract to
recover the remaining gold cargo of the SS Central America
shipwreck by the court appointed Receiver charged with overseeing
the recovery project. Our teams have been studying the extensive
research and records of the earlier work accomplished on the site
as well as research from our own archives. We are presently
preparing our recovery vessel, the Odyssey Explorer, to begin
recovery operations on the site in April 2014 utilizing our
equipment and personnel.
"We expect the project to move forward quickly since we have
access to all the previous records and images, which provide us
with a great overview of the shipwreck. This has allowed us to
begin planning operations that will focus on the most interesting
and prospective areas of the site after we have completed a
pre-disturbance survey and high-resolution photomosaic."
Stemm commented: "The SS Central America is one of the greatest
shipwreck stories of all time. We're honored to be working with the
Receiver and his team to share the next chapter of this
historically important shipwreck with the world.
"We're very familiar with mid-19th century paddlewheel
shipwrecks, as well as the range of artifacts that are likely to be
on the site. We have extensive experience with the tools and
techniques required for this archaeological excavation, which will
be very similar to the successful recovery of more than 51,000
coins and 14,000 artifacts from the SS Republic completed by
Odyssey 10 years ago. We're also experienced in working at extreme
depths. The SS Central America is less than half the 4,700 meter
(15,000 feet) depth of the SS Gairsoppa, from which we successfully
recovered 110 tons of silver over the past two years."
Fourth Quarter and Full Year 2013 Financial
Results
Total revenues in the fourth quarter of 2013 were $17.2 million,
as compared to $7.9 million in the same year-ago quarter. Total
revenues for the full year of 2013 were $23.9 million, as compared
to $13.2 million in 2012. The record increases in both periods is
primarily attributable to higher revenue from the sale of the SS
Gairsoppa shipwreck silver bullion in 2013. The SS Gairsoppa silver
was recovered in two separate expeditions, the first in 2012 and
the second in 2013.
Operations and research expenses in the fourth quarter of 2013
were $6.6 million, as compared to $6.3 million in the same year-ago
quarter. Operations and research expenses for the full year of 2013
were $26.0 million, as compared to $17.9 million in 2012. The
increase is primarily due to a lower recoupment of SS Gairsoppa
total project search and recovery costs of $9.2 million in 2013, as
compared to $17.8 million in 2012, as well as increased spending on
mineral exploration activities.
Marketing, general and administrative expenses in the fourth
quarter of 2012 were $3.8 million, as compared to $2.8 million in
the same year-ago quarter. The quarterly increase is primarily due
to extra legal expenses associated with the "Black Swan" case in
the fourth quarter of 2013. Marketing, general and administrative
expenses for the full year of 2013 were $14.2 million, as compared
to $10.6 million in 2012. The year-over-year increase in marketing,
general and administrative expenses was primarily due to an
increase in the company's professional fees and other services, an
increase in employee-related expenses, and included one-time fees
such as the payment of the "Black Swan" legal settlement fees.
Net income for the fourth quarter was a record $10.8 million or
$0.13 per share, as compared to a net loss of $0.9 million or
$(0.01) per share in the same year-ago quarter. Net loss for 2013
was $10.7 million or $(0.13) per share, as compared to a net loss
of $18.2 million or $(0.25) per share in 2011. According to
U.S. generally accepted accounting principles (GAAP), the $27.5
million of cash generated in 2013 from the sale of a minority stake
in the company's Oceanica subsidiary was not recorded in the
consolidated income statement.
The total cash balance was $32.0 million at December 31, 2013,
as compared to $10.4 million at December 31, 2012. The increase in
cash was primarily due to monetization of SS Gairsoppa silver and
sales of equity stakes in a mineral exploration subsidiary. A
portion of the cash balance has been set aside for repayment of
bank debt in 2014 and is accordingly shown as restricted cash on
the balance sheet.
Conference Call
On Monday, March 17, 2014, after filing its Annual Report on
Form 10-K for the year ended December 31, 2013, Odyssey will
host a conference call to discuss its fourth quarter results
at 11:00 a.m Eastern time.
Date: Monday, March 17, 2014 |
Time: 11:00 a.m. Eastern time (10:00 a.m.
Central time) |
Dial-in number: 1-877-941-8416 |
International dial-in number:
1-480-629-9808 |
Conference ID: 4672852 |
Webcast:
http://public.viavid.com/index.php?id=108186 |
The conference call will be webcast live and available for
replay via the investor section of the company's website at
www.odyssey.com.
Please call the conference telephone number 5-10 minutes prior
to the start time. An operator will register your name and
organization. If you have any difficulty connecting with the
conference call, please contact Liolios Group at
1-949-574-3860.
A replay of the call will be available approximately two hours
after the call through April 17, 2014.
Toll-free replay number: 1-877-870-5176 |
International replay number:
1-858-384-5517 |
Replay ID: 4672852 |
ROTH Conference
Odyssey has been invited to present at ROTH Capital Partners
26th Annual Conference being held March 10-12, 2014 at the
Ritz-Carlton in Dana Point, California.
Odyssey President and COO, Mark Gordon, is scheduled to present
on Wednesday, March 12, 2014, at 11:30 a.m. Pacific time, with
one-on-one meetings held throughout the day. Gordon will discuss
the company's shipwreck recovery and mineral exploration projects
that leverage its unique ability to find and recover valuable
seabed assets, including its 2013 record-breaking recovery of 61
tons of silver from the SS Gairsoppa shipwreck nearly three miles
deep.
For more information about the conference or to schedule a
one-on-one meeting with Odyssey management, please contact your
ROTH representative at 1-800-933-6830 or via e-mail at
conference@roth.com.
About Odyssey Marine Exploration
Odyssey Marine Exploration, Inc. (Nasdaq:OMEX) is engaged in
deep-ocean exploration using innovative methods and state
of-the-art technology for shipwreck projects and mineral
exploration. For additional details, please visit
www.odysseymarine.com. The company also maintains a Facebook page
at http://www.facebook.com/OdysseyMarine and a Twitter feed
@OdysseyMarine. For additional details on Odyssey Marine
Exploration, please visit www.odysseymarine.com.
Forward Looking Information
Odyssey Marine Exploration believes the information set forth in
this Press Release may include "forward looking statements" within
the meaning of the Private Securities Litigation Reform Act of
1995, Section 27A of the Securities Act of 1933 and Section 21E of
the Securities Act of 1934. Certain factors that could cause
results to differ materially from those projected in the
forward-looking statements are set forth in "Risk Factors" in Part
I, Item 1A of the Company's Annual Report on Form 10-K for the year
ended December 31, 2012, which was filed with the Securities and
Exchange Commission on March 12, 2013. The financial and operating
projections as well as estimates of mining assets are based solely
on the assumptions developed by Odyssey that it believes are
reasonable based upon information available to Odyssey as of the
date of this release. All projections and estimates are subject to
material uncertainties, and should not be viewed as a prediction or
an assurance of actual future performance. The validity and
accuracy of Odyssey's projections will depend upon unpredictable
future events, many of which are beyond Odyssey's control and,
accordingly, no assurance can be given that Odyssey's assumptions
will prove true or that its projected results will be achieved.
Cautionary Note to U.S. Investors
The U.S. Securities and Exchange Commission (SEC)
permits mining companies, in their filings with the SEC, to
disclose only those mineral deposits that a company can
economically and legally extract or produce. We use certain terms
in this press release, such as "measured" "indicated," and
"inferred" "resources," which the SEC guidelines strictly prohibit
us from including in our filings with the SEC. "Inferred mineral
resources" have a great amount of uncertainty as to their
existence, and great uncertainty as to their economic and legal
feasibility. It cannot be assumed that all or any part of an
inferred mineral resource will ever be upgraded to a higher
category. U.S. investors are cautioned not to assume that part or
all of the inferred mineral resource exists, or is economically or
legally mineable, and urged to consider closely the disclosures in
our Form 10-K which may be secured from us or from the SEC's
website at http://www.sec.gov/edgar.shtml.
Odyssey Marine
Exploration, Inc. and Subsidiaries – |
Condensed Results
from Operations |
$ millions, except
EPS |
3 month period ended Dec. 31,
2013 (unaudited) |
3 month period ended Dec. 31,
2012 (unaudited) |
12 month period ended Dec.
31, 2013 |
12 month period ended Dec.
31, 2012 |
Total Revenues |
17.2 |
7.9 |
23.9 |
13.2 |
Total Operating Expenses |
10.7 |
9.1 |
40.9 |
28.8 |
Income (Loss) from Operations |
6.6 |
(1.2) |
(17.0) |
(15.6) |
Total Other Income (Expense) |
3.1 |
0.3 |
2.6 |
(2.6) |
Income (Loss) before Taxes |
9.7 |
(0.9) |
(14.4) |
(18.2) |
Income tax (provision) |
(0.2) |
-- |
(0.5) |
-- |
Net Income (Loss) Before Income
taxes |
9.5 |
(0.9) |
(14.9) |
(18.2) |
Non-Controlling Interest |
1.2 |
-- |
4.1 |
-- |
Net Income (Loss) |
10.8 |
(0.9) |
(10.7) |
(18.2) |
|
|
|
|
|
Income (Loss) per Share |
0.13 |
(0.01) |
(0.13) |
(0.25) |
|
Odyssey Marine
Exploration, Inc. and Subsidiaries – Condensed Financial
Position |
$ millions, except EPS |
12 month period ended Dec.
31, 2013 |
12 month period ended Dec.
31, 2012 |
Total Cash |
32.0 |
10.4 |
Total Current Assets |
33.6 |
13.8 |
Property & Equipment (net) |
9.8 |
6.5 |
Total Other Assets |
8.1 |
6.7 |
Total Assets |
51.5 |
26.9 |
|
|
|
Total Current Liabilities |
27.9 |
39.0 |
Total Long Term Liabilities |
10.3 |
8.7 |
Total Liabilities |
38.3 |
47.7 |
Total Stockholders' Equity
(Deficit) |
13.2 |
(20.8) |
Total Liabilities & Stockholders'
Equity (Deficit) |
51.5 |
26.9 |
CONTACT: MEDIA CONTACT:
Liz Shows
Odyssey Marine Exploration, Inc.
(813) 876-1776 x 2335
lshows@odysseymarine.com
INVESTOR RELATIONS CONTACT:
Ron Both
Liolios Group, Inc.
(949) 574-3860
OMEX@liolios.com
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