Atwood Oceanics Announces Fiscal 2017 First Quarter Earnings
February 03 2017 - 4:31PM
Exhibit
99.1
FOR IMMEDIATE RELEASE - EARNINGS
HOUSTON,
February 3, 2017 - Atwood Oceanics, Inc. (NYSE: ATW)
("Company"), announced today that it had earned net income of $9.7
million or $0.15 per diluted share, on revenues of $157.6 million
for the quarter ended December 31, 2016, compared to net
income of $4.2 million or $0.07 per diluted share on revenues of
$188.7 million for the quarter ended September 30, 2016 and
compared to net income of $39.1 million or $0.60 per diluted share
on revenues of $307.8 million for the quarter ended
December 31, 2015.
During the quarter ended
December 31, 2015, the Company recorded a non-cash impairment
charge of approximately $64.7 million ($64.7 million, net of tax,
or $1.00 per diluted share) related to the Atwood
Falcon. During the quarter ended December 31, 2016, the
Company did not recognize any impairment.
During the quarter ended
December 31, 2015, the Company recognized approximately $18.0
million ($18.0 million, net of tax, or $0.28 per diluted share) of
expected insurance recoveries related to cyclone damage to the
Atwood Osprey. This amount is included in
Other income on the Unaudited Condensed Consolidated Statement of
Operations and was subsequently collected.
In January 2017, the client for
the Atwood Achiever exercised its option
provided as part of the "blend and extend" agreement we entered
into in October 2015 to revert the contract to the original
operating day rate and original end date. Exercise of this option
will result in a one-time payment to us of $48.1 million that
includes the difference in day rates, taxes, and administrative
fees covering the time periods for which the reduced day rate was
previously invoiced. Effective February 1, 2017 and continuing
until the contract end date of approximately November 12, 2017, the
operating day rate is $595,000.
In February 2017, we amended our
drilling services contract with Woodside Energy Ltd ("Woodside") to
substitute the Atwood Condor for the Atwood Osprey for the Greater Enfield
campaign. The contract is expected to commence between
December 2017 and March 2018 at an operating rate of $222,295 per
day for approximately 550 days. Depending on the commencement of
the contract, Woodside will reimburse us for the mobilization of
the Atwood Condor to Australia in an amount of
either $34.5 million or $36.5 million. In addition, we entered
into a new agreement with Woodside to utilize the Atwood Osprey for an additional exploration well with
an estimated duration of approximately 100 days. The contract
for the exploration well is expected to commence between March 2018
and May 2018 at an operating rate of $190,000 per day with a priced
option for an additional well. We will receive a mobilization fee
of $1.0 million if the option is exercised and a payment of $2.0
million if the option is not exercised.
|
For the Three
Months Ended |
|
(Unaudited) |
(In
thousands, except per share amounts) |
December 31,
2016 |
|
September 30,
2016 |
|
December 31,
2015 |
Revenues |
$ |
157,556 |
|
|
$ |
188,677 |
|
|
$ |
307,819 |
|
|
|
|
|
|
|
Income
before Income Taxes |
12,064 |
|
|
5,918 |
|
|
50,295 |
|
Provision for Income Taxes |
(2,393 |
) |
|
(1,669 |
) |
|
(11,214 |
) |
Net
Income |
$ |
9,671 |
|
|
$ |
4,249 |
|
|
$ |
39,081 |
|
|
|
|
|
|
|
Earnings per Common Share - |
|
|
|
|
|
Basic |
$ |
0.15 |
|
|
$ |
0.07 |
|
|
$ |
0.60 |
|
Diluted |
$ |
0.15 |
|
|
$ |
0.07 |
|
|
$ |
0.60 |
|
ATWOOD OCEANICS,
INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF
OPERATIONS
(UNAUDITED)
|
Three Months
Ended December 31, |
(In
thousands, except per share amounts) |
2016 |
|
2015 |
|
(Unaudited) |
REVENUES: |
|
|
|
Contract drilling |
$ |
149,863 |
|
|
$ |
294,615 |
|
Revenues related to reimbursable expenses |
7,693 |
|
|
13,204 |
|
Total
revenues |
157,556 |
|
|
307,819 |
|
|
|
|
|
COSTS AND EXPENSES: |
|
|
|
Contract drilling |
65,670 |
|
|
130,652 |
|
Reimbursable expenses |
6,602 |
|
|
8,286 |
|
Depreciation |
41,808 |
|
|
42,827 |
|
General and administrative |
15,190 |
|
|
15,177 |
|
Asset
impairment |
- |
|
|
64,724 |
|
(Gain)
loss on sale of assets |
(67 |
) |
|
77 |
|
|
129,203 |
|
|
261,743 |
|
|
|
|
|
OPERATING INCOME |
28,353 |
|
|
46,076 |
|
|
|
|
|
OTHER INCOME (EXPENSE): |
|
|
|
Interest expense, net of capitalized interest |
(16,291 |
) |
|
(13,761 |
) |
Interest income |
2 |
|
|
4 |
|
Other
income |
- |
|
|
17,976 |
|
|
(16,289 |
) |
|
4,219 |
|
|
|
|
|
INCOME BEFORE INCOME TAXES |
12,064 |
|
|
50,295 |
|
PROVISION FOR INCOME TAXES |
2,393 |
|
|
11,214 |
|
NET INCOME |
$ |
9,671 |
|
|
$ |
39,081 |
|
|
|
|
|
EARNINGS PER COMMON SHARE (NOTE 3): |
|
|
|
Basic |
$ |
0.15 |
|
|
$ |
0.60 |
|
Diluted |
$ |
0.15 |
|
|
$ |
0.60 |
|
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING (NOTE
3): |
|
|
|
Basic |
64,879 |
|
|
64,765 |
|
Diluted |
65,171 |
|
|
64,921 |
|
ATWOOD OCEANICS,
INC. AND SUBSIDIARIES
UNAUDITED ANALYSIS OF REVENUES AND DRILLING
COSTS
|
REVENUES |
|
Three Months
Ended |
(In
millions) |
December 31,
2016 |
|
September 30,
2016 |
|
December 31,
2015 |
Ultra-Deepwater |
$ |
148 |
|
|
$ |
155 |
|
|
$ |
182 |
|
Deepwater |
- |
|
|
- |
|
|
72 |
|
Jackups |
2 |
|
|
27 |
|
|
41 |
|
Reimbursable |
8 |
|
|
7 |
|
|
13 |
|
|
158 |
|
|
189 |
|
|
308 |
|
|
DRILLING COSTS |
|
Three Months
Ended |
(In
millions) |
December 31,
2016 |
|
September 30,
2016 |
|
December 31,
2015 |
Ultra-Deepwater |
$ |
50 |
|
|
$ |
58 |
|
|
$ |
61 |
|
Deepwater |
- |
|
|
2 |
|
|
43 |
|
Jackups |
14 |
|
|
17 |
|
|
26 |
|
Reimbursable |
7 |
|
|
5 |
|
|
8 |
|
Other |
1 |
|
|
- |
|
|
1 |
|
|
$ |
72 |
|
|
$ |
82 |
|
|
$ |
139 |
|
ATWOOD OCEANICS,
INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(In
thousands, except par value) |
December 31,
2016 |
|
September 30,
2016 |
|
(Unaudited) |
|
|
ASSETS |
|
|
|
Cash |
$ |
160,110 |
|
|
$ |
145,427 |
|
Accounts receivable, net |
95,464 |
|
|
113,091 |
|
Income
tax receivable |
6,471 |
|
|
6,095 |
|
Inventories of materials and supplies, net |
110,462 |
|
|
109,925 |
|
Prepaid expenses, deferred costs and other current assets |
15,745 |
|
|
18,504 |
|
Total
current assets |
388,252 |
|
|
393,042 |
|
|
|
|
|
Property and equipment, net |
4,223,156 |
|
|
4,127,696 |
|
|
|
|
|
Other
receivables |
11,831 |
|
|
11,831 |
|
Deferred income taxes |
165 |
|
|
165 |
|
Deferred costs and other assets |
6,253 |
|
|
7,058 |
|
Total assets |
$ |
4,629,657 |
|
|
$ |
4,539,792 |
|
|
|
|
|
LIABILITIES AND SHAREHOLDERS' EQUITY |
|
|
|
Accounts payable |
22,290 |
|
|
25,299 |
|
Accrued liabilities |
9,076 |
|
|
7,868 |
|
Interest payable |
14,896 |
|
|
7,096 |
|
Income
tax payable |
8,313 |
|
|
8,294 |
|
Deferred credits and other liabilities |
285 |
|
|
799 |
|
Total current liabilities |
54,860 |
|
|
49,356 |
|
|
|
|
|
Long-term debt |
1,297,995 |
|
|
1,227,919 |
|
Deferred income taxes |
1,403 |
|
|
1,202 |
|
Deferred credits |
350 |
|
|
- |
|
Other |
30,613 |
|
|
30,929 |
|
Total long-term liabilities |
1,330,361 |
|
|
1,260,050 |
|
|
|
|
|
Commitments and contingencies (Note 9) |
|
|
|
|
|
|
|
Preferred stock, no par value, 1,000 shares authorized, none
outstanding |
$ |
- |
|
|
$ |
- |
|
Common
stock, $1.00 par value, 180,000 shares authorized with 64,942
issued and outstanding as of December 31, 2016 and 180,000 shares
authorized and 64,799 shares issued and outstanding as of September
30, 2016 |
$ |
64,942 |
|
|
$ |
64,799 |
|
Paid-in capital |
$ |
241,558 |
|
|
$ |
237,542 |
|
Retained earnings |
$ |
2,938,546 |
|
|
$ |
2,929,839 |
|
Accumulated other comprehensive loss |
$ |
(610 |
) |
|
$ |
(1,794 |
) |
Total
shareholders' equity |
3,244,436 |
|
|
3,230,386 |
|
Total liabilities and shareholders'
equity |
$ |
4,629,657 |
|
|
$ |
4,539,792 |
|
ATWOOD OCEANICS,
INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWS
(UNAUDITED)
|
Three Months
Ended December 31, |
(In
thousands) |
2016 |
|
2015 |
Cash flows from operating activities: |
|
|
|
Net
income |
$ |
9,671 |
|
|
$ |
39,081 |
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
Depreciation |
41,808 |
|
|
42,827 |
|
Amortization |
922 |
|
|
1,250 |
|
Provision for doubtful accounts |
2,369 |
|
|
757 |
|
Deferred income tax benefit |
(185 |
) |
|
(714 |
) |
Share-based compensation expense |
3,655 |
|
|
2,371 |
|
Asset
impairment |
- |
|
|
64,724 |
|
(Gain)
loss on sale of assets |
(67 |
) |
|
77 |
|
Changes in assets and liabilities: |
|
|
|
Accounts receivable |
15,258 |
|
|
60,883 |
|
Income
tax receivable |
(376 |
) |
|
(829 |
) |
Inventories of materials and supplies |
(537 |
) |
|
11,023 |
|
Prepaid expenses, deferred costs and other current assets |
2,759 |
|
|
7,462 |
|
Deferred costs and other assets |
(496 |
) |
|
(1,050 |
) |
Accounts payable |
(1,396 |
) |
|
(17,615 |
) |
Accrued liabilities |
9,191 |
|
|
8,570 |
|
Income
tax payable |
19 |
|
|
(642 |
) |
Deferred credits and other liabilities |
902 |
|
|
1,973 |
|
Net
cash provided by operating activities |
83,497 |
|
|
220,148 |
|
|
|
|
|
Cash flows from investing activities: |
|
|
|
Capital expenditures |
(138,814 |
) |
|
(131,547 |
) |
Net
cash used in investing activities |
(138,814 |
) |
|
(131,547 |
) |
|
|
|
|
Cash flows from financing activities: |
|
|
|
Proceeds from issuance of long-term debt |
125,000 |
|
|
45,000 |
|
Principal payments on long-term debt |
(55,000 |
) |
|
(115,000 |
) |
Dividends paid |
- |
|
|
(16,316 |
) |
Payments related to exercise of stock options |
- |
|
|
(599 |
) |
Net
cash provided by (used in) or financing activities
|
70,000 |
|
|
(86,915 |
) |
Net
increase in cash and cash equivalents |
14,683 |
|
|
1,686 |
|
Cash
and cash equivalents, at beginning of period |
145,427 |
|
|
113,983 |
|
Cash and cash equivalents, at end of
period |
160,110 |
|
|
115,669 |
|
|
|
|
|
Non-cash activities: |
|
|
|
Decrease (increase) in accounts payable related to capital
expenditures |
$ |
(1,613 |
) |
|
$ |
10,530 |
|
Dividends payable |
$ |
- |
|
|
$ |
4,858 |
|
Atwood Oceanics, Inc. is a leading
offshore drilling company engaged in the drilling and completion of
exploration and development wells for the global oil and gas
industry. The Company currently owns 10 mobile offshore drilling
units and is constructing 2 ultra-deepwater drillships. The Company
was founded in 1968 and is headquartered in Houston, Texas. Atwood
Oceanics, Inc. common stock is traded on the New York Stock
Exchange under the symbol "ATW." For more information about the
Company, please visit www.atwd.com.
Conference
Call
The Company has scheduled a
conference call and webcast related to its first quarter 2017
results on Monday, February 6, 2017, at 9:00 A.M. CDT
(10:00 A.M. EDT). Interested parties are invited to listen to the
call by dialing 1-800-894-5910, or internationally 1-785-424-1052,
Conference ID - ATWOOD/ Password 25965. Interested parties may also
listen over the Internet through a link posted in the Investor
Relations section of the Company's Web site.
A replay of the conference call
will be available on the Company's Web site following the end
of the live call.
Contact: Mark W. Smith
Senior Vice President and Chief Financial Officer
(281) 749-7840
This
announcement is distributed by Nasdaq Corporate Solutions on behalf
of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the
information contained therein.
Source: Atwood Oceanics, Inc. via Globenewswire
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