HOUSTON, July 24, 2014 /PRNewswire/
-- PATTERSON-UTI ENERGY,
INC. (NASDAQ: PTEN) today reported financial results for the
three and six months ended June 30,
2014. The Company reported net income of $54.3 million, or $0.37 per share, for the second quarter of 2014,
compared to net income of $40.8
million, or $0.28 per share,
for the quarter ended June 30, 2013.
Revenues for the second quarter of 2014 were $757 million, compared to $659 million for the second quarter of 2013.
The Company reported net income of $89.1
million, or $0.61 per share,
for the six months ended June 30,
2014, compared to net income of $97.0
million, or $0.66 per share,
for the six months ended June 30,
2013. Revenues for the six months ended June 30, 2014 were $1.4
billion, compared to $1.3
billion for the same period in 2013.
Andy Hendricks, Patterson-UTI's
Chief Executive Officer, stated, "We are very pleased with our
second quarter results. Revenues, margins and profits all
increased sequentially in both drilling and pressure
pumping.
"Our average rig count in the United
States increased by eight rigs in the second quarter to 201
rigs from 193 rigs in the first quarter. The growth in U.S.
rig count more than offset the annual seasonal decline in
Canada to three rigs from 10 rigs
in the first quarter. Activity in Canada has begun to ramp up and our rig count
in the United States is continuing
to increase. For the month of July, we expect to average 207
rigs operating in the United
States and 9 rigs in Canada."
Mr. Hendricks added, "Strong demand for high-specification
drilling rigs is positively impacting rig pricing for all classes
of our rigs. Higher dayrates and an improving fleet mix of
higher dayrate APEX® rigs contributed to a $490 sequential increase in average U.S. rig
revenue per day to $23,490. The
strength in average U.S. rig revenue per day offset the seasonal
decline in Canada as our total
average rig revenue per day increased $240 sequentially to $23,630 during the second quarter. Average
U.S. rig margin per day increased $370 sequentially to $9,900, and total rig margin per day increased
$270 sequentially to $9,870.
"We completed six new APEX® rigs during the second
quarter, bringing our APEX® rig fleet to 133 rigs.
Since our last earnings release we have signed 19 contracts for new
APEX® rigs. In response to strong customer demand,
we expect to complete 25 new APEX® rigs during the four
quarters ending June 2015, of which
22 are currently contracted. Furthermore, we have customer
contracts for three additional new APEX® rigs to be
completed in the second half of 2015.
"As of June 30, 2014, we had term
contracts for drilling rigs providing for approximately
$1.5 billion of future dayrate
drilling revenue. Based on contracts currently in place, we
expect an average of 149 rigs operating under term contracts during
the third quarter, and an average of 138 rigs operating under term
contracts during the last half of 2014.
"In pressure pumping, we generated record quarterly revenues of
$307 million, a sequential increase
of $66.3 million, as activity levels
surpassed our expectations, and we benefited from a small pressure
pumping acquisition in June. The increased pressure pumping
revenue drove a $23.9 million
increase in EBITDA during the quarter to a total of $59.5 million.
"In response to customer demand, we have recently ordered an
incremental 115,000 of fracturing horsepower. Together with
the previously announced 40,000 horsepower on order, we now have a
total of 155,000 horsepower on order, which is enough equipment for
three complete horizontal frac spreads plus spares. Two of
these frac spreads are already contracted. We expect the
delivery of these three frac spreads in the fourth quarter of 2014
and the first and second quarters of 2015," he concluded.
Mark S. Siegel, Chairman of
Patterson-UTI, stated, "In a quarter marked by strength in our two
core businesses, we generated record quarterly revenue for both the
overall Company and for pressure pumping. More importantly,
the outlook remains highly constructive as we believe we are in the
early stages of an extended period of growth for ourselves and our
industry.
"High-specification drilling rigs continue to be in short supply
across the industry. Within our own fleet, we achieved 99%
utilization of our APEX® rigs during the second quarter,
and we have very limited availability of new APEX® rigs
through the second quarter of 2015.
"In pressure pumping, utilization was stronger than expected due
to increased demand for our pressure pumping services. We
expect demand will continue to improve due to the strength in
horizontal drilling activity and the increasing frac
intensity. Consistent with the demand we are seeing, we
ordered additional equipment and completed a strategic acquisition
of 31,500 horsepower of hydraulic fracturing equipment during the
second quarter. This acquisition not only expanded the size
of our fleet, but also provided the Company with a new base of
operations and employees to efficiently support pressure pumping
activities in East Texas and
Louisiana," he concluded.
The Company declared a quarterly dividend on its common stock of
$0.10 per share, to be paid on
September 24, 2014 to holders of
record as of September 10, 2014.
All references to "net income per share" in this press release
are diluted earnings per common share as defined within Accounting
Standards Codification Topic 260.
The Company's quarterly conference call to discuss the operating
results for the quarter ended June 30,
2014 is scheduled for today, July 24,
2014 at 9:00 a.m. Central
Time. The dial-in information for participants is
800-706-7741 (Domestic) and 617-614-3471 (International). The
access code for both numbers is 34697733. The call is also
being webcast and can be accessed through the Investor Relations
section at www.patenergy.com. A replay of the conference call
will be on the Company's website for two weeks. A telephonic
replay will be available through July 28,
2014 at 888-286-8010 (Domestic) and 617-801-6888
(International) with the access code 56998764.
About Patterson-UTI
Patterson-UTI Energy, Inc. subsidiaries provide onshore contract
drilling and pressure pumping services to exploration and
production companies in North America. Patterson-UTI Drilling
Company LLC and its subsidiaries have more than 275 marketable
land-based drilling rigs and operate primarily in oil and natural
gas producing regions in the continental United States, Alaska, and western and northern Canada.
Universal Pressure Pumping, Inc. and Universal Well Services, Inc.
provide pressure pumping services primarily in Texas and the Appalachian region.
Location information about the Company's drilling rigs and their
individual inventories is available through the Company's website
at www.patenergy.com.
Statements made in this press release which state the
Company's or management's intentions, beliefs, expectations or
predictions for the future are forward-looking statements. It is
important to note that actual results could differ materially from
those discussed in such forward-looking statements. Important
factors that could cause actual results to differ materially
include, but are not limited to, volatility in customer spending
and in oil and natural gas prices, which could adversely affect
demand for our services and their associated effect on rates,
utilization, margins and planned capital expenditures; global
economic conditions; excess availability of land drilling rigs and
pressure pumping equipment, including as a result of reactivation
or construction; equipment specialization and new technologies;
adverse industry conditions; adverse credit and equity market
conditions; difficulty in building and deploying new equipment;
difficulty in integrating acquisitions; shortages, delays in
delivery and interruptions of supply of equipment, supplies
and materials; weather; loss of key customers; liabilities from
operations; ability to effectively identify and enter new markets;
governmental regulation; ability to realize backlog; and ability to
retain management and field personnel. Additional information
concerning factors that could cause actual results to differ
materially from those in the forward-looking statements is
contained from time to time in the Company's SEC filings, which may
be obtained by contacting the Company or the SEC. These filings are
also available through the Company's web site at
http://www.patenergy.com or through the SEC's Electronic
Data Gathering and Analysis Retrieval System (EDGAR) at
http://www.sec.gov. We undertake no obligation to
publicly update or revise any forward-looking statement.
|
PATTERSON-UTI
ENERGY, INC.
Consolidated
Condensed Statements of Operations
(unaudited, in
thousands, except per share data)
|
|
|
Three Months
Ended
June
30,
|
Six Months
Ended
June
30,
|
|
2014
|
2013
|
2014
|
2013
|
|
|
|
|
|
REVENUES
|
$ 757,276
|
$ 659,316
|
$ 1,435,444
|
$ 1,326,355
|
|
|
|
|
|
COSTS AND
EXPENSES
|
|
|
|
|
Direct operating
costs
|
500,167
|
434,242
|
954,308
|
852,392
|
Depreciation,
depletion, amortization and impairment
|
153,426
|
137,182
|
300,748
|
273,617
|
Selling, general and
administrative
|
19,548
|
18,319
|
39,221
|
35,716
|
Net gain on asset
disposals
|
(3,091)
|
(1,033)
|
(4,835)
|
(908)
|
Total costs and
expenses
|
670,050
|
588,710
|
1,289,442
|
1,160,817
|
|
|
|
|
|
OPERATING
INCOME
|
87,226
|
70,606
|
146,002
|
165,538
|
|
|
|
|
|
OTHER INCOME
(EXPENSE)
|
|
|
|
|
Interest
income
|
208
|
250
|
384
|
423
|
Interest
expense
|
(7,249)
|
(6,941)
|
(14,437)
|
(13,707)
|
Other
|
3
|
381
|
3
|
400
|
Total other
expense
|
(7,038)
|
(6,310)
|
(14,050)
|
(12,884)
|
|
|
|
|
|
INCOME BEFORE INCOME
TAXES
|
80,188
|
64,296
|
131,952
|
152,654
|
INCOME TAX
EXPENSE
|
25,905
|
23,528
|
42,847
|
55,656
|
|
|
|
|
|
NET INCOME
|
$ 54,283
|
$ 40,768
|
$ 89,105
|
$ 96,998
|
|
|
|
|
|
NET INCOME PER COMMON
SHARE
|
|
|
|
|
Basic
|
$
0.37
|
$
0.28
|
$
0.62
|
$
0.66
|
Diluted
|
$
0.37
|
$
0.28
|
$
0.61
|
$
0.66
|
|
|
|
|
|
|
|
|
|
|
WEIGHTED AVERAGE NUMBER
OF COMMON SHARES OUTSTANDING
|
|
|
|
|
Basic
|
143,622
|
145,465
|
143,259
|
145,148
|
Diluted
|
146,029
|
146,374
|
145,586
|
146,292
|
|
|
|
|
|
CASH DIVIDENDS PER
COMMON SHARE
|
$
0.10
|
$
0.05
|
$
0.20
|
$
0.10
|
|
PATTERSON-UTI
ENERGY, INC.
Additional Financial
and Operating Data
(unaudited, dollars
in thousands)
|
|
|
Three Months
Ended
June
30,
|
Six Months
Ended
June
30,
|
|
2014
|
2013
|
2014
|
2013
|
|
|
|
|
|
Contract
Drilling:
|
|
|
|
|
Revenues
|
$ 438,583
|
$ 389,979
|
$ 864,486
|
$ 809,073
|
Direct operating
costs
|
$ 255,318
|
$ 242,748
|
$ 506,377
|
$ 489,820
|
Margin (1)
|
$ 183,265
|
$ 147,231
|
$ 358,109
|
$ 319,253
|
Selling, general and
administrative
|
$ 1,591
|
$ 1,879
|
$ 3,239
|
$ 3,730
|
Depreciation,
amortization and impairment
|
$ 112,057
|
$ 98,283
|
$ 218,176
|
$ 195,905
|
Operating
income
|
$ 69,617
|
$ 47,069
|
$ 136,694
|
$ 119,618
|
|
|
|
|
|
Operating days –
United States
|
18,296
|
16,678
|
35,621
|
33,635
|
Operating days –
Canada
|
267
|
186
|
1,156
|
1,132
|
Total operating
days
|
18,563
|
16,864
|
36,777
|
34,767
|
|
|
|
|
|
Average revenue per
operating day – United States
|
$ 23.49
|
$ 22.99
|
$ 23.25
|
$ 22.97
|
Average direct
operating costs per operating day – United States
|
$ 13.59
|
$ 14.16
|
$ 13.53
|
$ 13.83
|
Average margin per
operating day – United States (1)
|
$
9.90
|
$
8.83
|
$
9.72
|
$
9.14
|
Average rigs
operating – United States
|
201
|
183
|
197
|
186
|
|
|
|
|
|
Average revenue per
operating day – Canada
|
$ 32.87
|
$ 34.90
|
$ 31.31
|
$ 32.27
|
Average direct
operating costs per operating day – Canada
|
$ 25.05
|
$ 35.06
|
$ 21.15
|
$ 21.88
|
Average margin per
operating day – Canada (1)
|
$
7.82
|
$
(0.16)
|
$ 10.16
|
$ 10.40
|
Average rigs
operating – Canada
|
3
|
2
|
6
|
6
|
|
|
|
|
|
Average revenue per
operating day – Total
|
$ 23.63
|
$ 23.12
|
$ 23.51
|
$ 23.27
|
Average direct
operating costs per operating day – Total
|
$ 13.75
|
$ 14.39
|
$ 13.77
|
$ 14.09
|
Average margin per
operating day – Total (1)
|
$
9.87
|
$
8.73
|
$
9.74
|
$
9.18
|
Average rigs
operating – Total
|
204
|
185
|
203
|
192
|
|
|
|
|
|
Capital
expenditures
|
$ 211,917
|
$ 117,794
|
$ 336,840
|
$ 252,177
|
|
|
|
|
|
Pressure
Pumping:
|
|
|
|
|
Revenues
|
$ 306,577
|
$ 254,620
|
$ 546,838
|
$ 485,780
|
Direct operating
costs
|
$ 241,977
|
$ 188,280
|
$ 441,785
|
$ 356,436
|
Margin (2)
|
$ 64,600
|
$ 66,340
|
$ 105,053
|
$ 129,344
|
Selling, general and
administrative
|
$ 5,067
|
$ 4,297
|
$ 9,935
|
$ 8,550
|
Depreciation,
amortization and impairment
|
$ 34,623
|
$ 31,789
|
$ 68,665
|
$ 62,025
|
Operating
income
|
$ 24,910
|
$ 30,254
|
$ 26,453
|
$ 58,769
|
|
|
|
|
|
Fracturing
jobs
|
271
|
344
|
514
|
610
|
Other jobs
|
1,058
|
1,187
|
1,938
|
2,329
|
Total jobs
|
1,329
|
1,531
|
2,452
|
2,939
|
|
|
|
|
|
Average revenue per
fracturing job
|
$ 1,063.28
|
$ 678.34
|
$ 993.05
|
$ 724.67
|
Average revenue per
other job
|
$ 17.42
|
$ 17.92
|
$ 18.79
|
$ 18.78
|
Total average revenue
per job
|
$ 230.68
|
$ 166.31
|
$ 223.02
|
$ 165.29
|
Total average costs
per job
|
$ 182.07
|
$ 122.98
|
$ 180.17
|
$ 121.28
|
Total average margin
per job (2)
|
$ 48.61
|
$ 43.33
|
$ 42.84
|
$ 44.01
|
Margin as a
percentage of revenues (2)
|
21.1%
|
26.1%
|
19.2%
|
26.6%
|
|
|
|
|
|
Capital expenditures
and acquisitions
|
$ 96,186
|
$ 34,202
|
$ 132,483
|
$ 64,436
|
|
|
|
|
|
Oil and Natural Gas
Production and Exploration:
|
|
|
|
|
Revenues –
Oil
|
$ 10,747
|
$ 13,165
|
$ 21,078
|
$ 28,560
|
Revenues – Natural
gas and liquids
|
$ 1,369
|
$ 1,552
|
$ 3,042
|
$ 2,942
|
Revenues –
Total
|
$ 12,116
|
$ 14,717
|
$ 24,120
|
$ 31,502
|
Direct operating
costs
|
$ 2,872
|
$ 3,214
|
$ 6,146
|
$ 6,136
|
Margin (3)
|
$ 9,244
|
$ 11,503
|
$ 17,974
|
$ 25,366
|
Depletion
|
$ 4,814
|
$ 5,459
|
$ 9,808
|
$ 11,182
|
Impairment of oil and
natural gas properties
|
$
798
|
$
517
|
$ 1,831
|
$ 2,416
|
Operating
income
|
$ 3,632
|
$ 5,527
|
$ 6,335
|
$ 11,768
|
Capital
expenditures
|
$ 8,742
|
$ 5,438
|
$ 17,426
|
$ 14,102
|
|
|
|
|
|
Corporate and
Other:
|
|
|
|
|
Selling, general and
administrative
|
$ 12,890
|
$ 12,143
|
$ 26,047
|
$ 23,436
|
Depreciation
|
$ 1,134
|
$ 1,134
|
$ 2,268
|
$ 2,089
|
Net gain on asset
disposals
|
$ (3,091)
|
$ (1,033)
|
$ (4,835)
|
$ (908)
|
Capital
expenditures
|
$
821
|
$ 1,003
|
$ 1,289
|
$ 1,883
|
|
|
|
|
|
Total capital
expenditures and acquisitions
|
$ 317,666
|
$ 158,437
|
$ 488,038
|
$ 332,598
|
(1)
|
For Contract
Drilling, margin is defined as revenues less direct operating costs
and excludes depreciation, amortization and impairment and selling,
general and administrative expenses. Average margin per
operating day is defined as margin divided by operating
days.
|
|
|
(2)
|
For Pressure Pumping,
margin is defined as revenues less direct operating costs and
excludes depreciation, amortization and impairment and selling,
general and administrative expenses. Total average margin per
job is defined as margin divided by total jobs. Margin as a
percentage of revenues is defined as margin divided by
revenues.
|
|
|
(3)
|
For Oil and Natural
Gas Production and Exploration, margin is defined as revenues less
direct operating costs and excludes depletion and
impairment.
|
|
|
|
June 30,
|
December
31,
|
Selected Balance Sheet
Data (Unaudited):
|
|
|
2014
|
2013
|
Cash and cash
equivalents
|
|
|
$
120,837
|
$
249,509
|
Current
assets
|
|
|
$
758,731
|
$
808,650
|
Current
liabilities
|
|
|
$
501,886
|
$
354,277
|
Working
capital
|
|
|
$
256,845
|
$
454,373
|
Current portion of
long-term debt
|
|
|
$
10,000
|
$
10,000
|
Long-term
debt
|
|
|
$
677,500
|
$
682,500
|
|
|
|
|
|
|
PATTERSON-UTI
ENERGY, INC.
Non-GAAP Financial
Measures
(unaudited, dollars
in thousands)
|
|
|
Three Months
Ended
June
30,
|
Six Months
Ended
June
30,
|
|
2014
|
2013
|
2014
|
2013
|
|
|
|
|
|
Earnings Before
Interest, Taxes, Depreciation and Amortization
(EBITDA)(1):
|
|
|
|
|
Net income
|
$ 54,283
|
$ 40,768
|
$ 89,105
|
$ 96,998
|
Income tax
expense
|
25,905
|
23,528
|
42,847
|
55,656
|
Net interest
expense
|
7,041
|
6,691
|
14,053
|
13,284
|
Depreciation,
depletion, amortization and impairment
|
153,426
|
137,182
|
300,748
|
273,617
|
EBITDA
|
$ 240,655
|
$ 208,169
|
$ 446,753
|
$ 439,555
|
|
|
|
|
|
Total
revenue
|
$ 757,276
|
$ 659,316
|
$ 1,435,444
|
$ 1,326,355
|
|
|
|
|
|
EBITDA
margin
|
31.8 %
|
31.6 %
|
31.1 %
|
33.1%
|
|
|
|
|
|
EBITDA by operating
segment:
|
|
|
|
|
Contract
drilling
|
$ 181,674
|
$ 145,352
|
$ 354,870
|
$ 315,523
|
Pressure
pumping
|
59,533
|
62,043
|
95,118
|
120,794
|
Oil and natural
gas
|
9,244
|
11,503
|
17,974
|
25,366
|
Corporate and
other
|
(9,796)
|
(10,729)
|
(21,209)
|
(22,128)
|
Consolidated
EBITDA
|
$ 240,655
|
$ 208,169
|
$ 446,753
|
$ 439,555
|
|
|
|
|
|
(1)
|
EBITDA is not defined
by generally accepted accounting principles ("GAAP"). We present
EBITDA (a non-GAAP measure) because we believe it provides
additional information with respect to both the performance of our
fundamental business activities and our ability to meet our capital
expenditures and working capital requirements. EBITDA should not be
construed as an alternative to the GAAP measures of net income or
operating cash flow.
|
SOURCE PATTERSON-UTI ENERGY,
INC.