FORT WORTH, Texas, Feb. 18, 2016 /PRNewswire/ -- Basic Energy
Services, Inc. (NYSE: BAS) ("Basic") today announced its financial
and operating results for the fourth quarter and twelve months
ended December 31, 2015.
FOURTH QUARTER 2015 HIGHLIGHTS
Fourth quarter 2015 revenue declined 15% to $161.0 million from $189.2
million in the third quarter of 2015, as normal seasonal
declines, including reduced daylight hours, holidays and inclement
weather, were compounded by continued pricing pressure and
diminished activity levels. In the fourth quarter of 2014, Basic
generated $400.9 million in
revenue.
For the fourth quarter of 2015, Basic reported a net loss of
$55.2 million, or a loss of
$1.36 per basic and diluted share.
This compares to a reported net loss of $105.6 million, or a loss of $2.63 per basic and diluted share, in the third
quarter of 2015. The third quarter of 2015 included a tax-effected,
non-cash charge of $55.1 million
($81.9 million before tax), or
$1.37 per basic and diluted share,
for impairment of all of the goodwill associated with the
completion and remedial services segment. Excluding this
special item, Basic reported a net loss of $50.6 million, or $1.26 per basic and diluted share, in the third
quarter of 2015. In the fourth quarter of 2014, Basic reported a
net loss of $18.8 million, or
$0.45 per basic and diluted share.
The fourth quarter of 2014 included a tax-effected, non-cash charge
of $23.5 million ($34.7 million before tax), or $0.56 per basic and diluted share, for impairment
of all the goodwill associated with the well servicing and fluid
services segments. Excluding this special item, Basic reported net
income of $4.7 million, or
$0.11 per basic and diluted share, in
the fourth quarter of 2014.
Roe Patterson, Basic's President and Chief Executive Officer,
stated, "Without a doubt, 2015 was a very challenging year as U.S.
land activity experienced its largest decline in the past thirty
years. Capital spending by our customers declined by more than 30%
and the U.S. drilling rig count ended 2015 almost 70% lower than
the 2014 peak.
"Our fourth quarter results reflect the impact of the additional
decline in all oilfield related services. Our customers started to
rapidly reduce their activities early in the quarter as they
attempted to preserve cash and defer maintenance work in response
to continually weak commodity prices. Operations were further
impacted by the year-end holiday season and the extreme weather
conditions in late November and December. Heavy snowfall in
the Permian Basin and Oklahoma
caused significant downtime in all lines of business as we
experienced blizzard conditions in many markets.
"Fourth quarter margins declined across all product lines, with
completion and remedial services being impacted the most due to the
continuing decline in new drills and completions. The amount
of excess equipment available in most markets applies further
pressure on rates. Our fluid services business has been the most
resilient due to our integrated strategy that benefits from our
extensive salt water disposal well network, which allows us to keep
costs low and efficiencies high.
"Pricing in all of our markets and lines of business remains
very competitive, and we continue to implement our well-developed
strategy to deal with the current operating environment, including
scaling operations and capital expenditures to fit cash flow and
preserve our liquidity. As a result, we continue to stack equipment
and exit markets where cash margins do not support maintenance
capital expenditures. During the quarter, we stacked an additional
19,000 hydraulic horsepower ("HHP"), for a total of 64,000 HHP
stacked at year-end, and we have already stacked over 40,000
additional HHP in the first quarter of this year. We have also
reduced our direct costs in field, reduced headcount by 35%, and
lowered quarterly SG&A expenses by $11
million, or 25%, since the fourth quarter of 2014. While
these cost cutting initiatives have been aggressive and relatively
proactive over the last 12 months, it has been difficult to keep
pace with the broad decline in overall activity.
"Looking forward, we expect this pace of decline to subside in
the first half of 2016. However, the first quarter will remain
challenging as our industry finds a bottom. Customers have
expressed various levels of capital expenditure reductions for 2016
and many have chosen to defer or delay all projects until commodity
prices improve. This lack of visibility and continued market
uncertainties prevent us from knowing exactly what our near term
results will look like. But based on current activity levels, we
anticipate that our first quarter revenue will be down
approximately 10% sequentially.
"This downturn has been deeper and longer lasting than anyone
originally anticipated. As we see little near term relief, we
decided to ensure that the company would have sufficient liquidity
to survive a meaningfully longer downturn. We evaluated many
options over the last six months that would provide the best
approach to increase liquidity. We concluded that the best path to
accomplish this was to utilize the secured debt baskets allowed
under our senior unsecured bonds. On February 17, we entered into a $165 million term loan agreement with a syndicate
of lenders. Although the cost of this financing is high, we believe
that this term loan provides us with sufficient liquidity to
survive a two-year plus lower operating environment.
"In conjunction with this financing, the company is currently
undergoing significant changes to our operating infrastructure that
will allow us to reduce our cash burn and help extend our
liquidity. We expect these changes to be fully implemented by
the first half of this year and we will continue to look for ways
to operate in a cost effective manner to get the company to cash
flow break-even or better in the second half of 2016."
Adjusted EBITDA decreased to ($7.5
million), or (5%) of revenues, for the fourth quarter of
2015 from ($1.6 million), or (1%) of
revenues, in the third quarter of 2015. In the fourth quarter
of 2014, Basic generated Adjusted EBITDA of $85.6 million, or 21% of revenues. Adjusted
EBITDA is defined as net income before interest, taxes,
depreciation and amortization, loss on goodwill impairment, loss on
legal settlements, loss on customer audit settlements, and the net
gain or loss from the disposal of assets. EBITDA and Adjusted
EBITDA, which are not measures determined in accordance with
United States generally accepted
accounting principles ("GAAP"), are defined and reconciled in note
3 under the accompanying financial tables.
Term Loan Financing
On February 17, 2016, Basic
entered into a Term Loan Credit Agreement with a syndicate of
lenders and U.S. Bank National Association, as administrative agent
for the lenders. This agreement provides for borrowings of an
aggregate principal amount of $165.0
million on the closing date, and delayed draw term loan
borrowings in an aggregate principal amount not to exceed
$15.0 million. The obligations
under the Term Loan Agreement will be secured by substantially all
assets of Basic. Basic expects to borrow the initial
borrowings of $165.0 million under
the Term Loan Credit Agreement on February
26, 2016, subject to the satisfaction of closing
conditions.
The term loan will bear interest at 13.5%. In addition,
Basic will be responsible for the applicable lenders' fees,
including a closing payment equal to 7.0% of the aggregate
principal amount of the commitments.
In conjunction with this financing, Basic intends to amend its
existing revolving credit agreement, reducing the aggregate
commitment from $250.0 million to $100.0
million.
Pro forma liquidity as of March 31,
2016, including this term loan would be approximately
$220.3 million, including
$23.1 million of availability under
Basic's amended $100 million
revolving credit facility.
FULL YEAR 2015 HIGHLIGHTS
Including a revenue adjustment in the second quarter of 2015,
revenues for the twelve months of 2015 were $805.6 million. This represents a 46% decrease
from revenue of $1.5 billion during
the comparable period of 2014.
For the twelve months ended December 31,
2015, Basic reported a net loss of $241.7 million, or a loss of $5.97 per basic and diluted share. Excluding
special items, Basic generated an adjusted net loss of $186.7 million, or a loss of $4.58 per basic and diluted share for the full
year 2015. Special items include the goodwill write-down in the
third quarter of 2015 noted above, as well as a second quarter
tax-effected charge of $2.9 million,
related to a credit given to a customer resulting from the
settlement of an audit. This compares to reported net loss of
$8.3 million, or $0.20 per basic and diluted share during the
twelve months ended December 31,
2014. Excluding the goodwill impairment charge mentioned
above, Basic generated adjusted net income of $18.1 million, or $0.43 per basic and diluted share, in 2014.
Adjusted EBITDA for the full year 2015 decreased 92% to
$24.3 million, or 3% of revenue,
compared to $318.0 million, or 21% of
revenue, for the full year 2014. Adjusted EBITDA excludes the
special items discussed above for both 2015 and 2014. Adjusted
EBITDA is reconciled in note 3 under the accompanying financial
tables.
Business Segment Results
Completion and Remedial Services
Completion and remedial services revenue dropped by 13% to
$58.5 million in the fourth quarter
of 2015 from $67.2 million in the
prior quarter, excluding the special item from the third quarter of
2015 mentioned above. The sequential decline in revenue was
primarily due to normal seasonal and weather-related declines,
which included reduced daylight hours as well as severe weather in
most of our major markets. Frac and cementing activity also dropped
significantly due to sustained activity reductions resulting from
the lower drilling rig count. These losses were offset by
continued high utilization of our coil tubing equipment. In
the fourth quarter of 2014, this segment generated $203.4 million in revenue.
At December 31, 2015, Basic had
approximately 444,000 hydraulic horsepower ("HHP"), flat compared
to the end of the previous quarter and up slightly from 443,000 HHP
as of December 31, 2014. Weighted
average HHP for the fourth quarter of 2015 was 444,000, up from
442,000 in the third quarter of 2015. 64,000 HHP was stacked
as of December 31, 2015.
Segment profit in the fourth quarter of 2015 decreased 23% to
$8.5 million compared to $11.1 million in the prior quarter, excluding the
special item mentioned above. Segment margin for the fourth
quarter 2015 decreased to 15% compared to the previous quarter,
driven predominantly by the negative impact of decremental margins
on the lower revenue base. During the fourth quarter of 2014,
segment profit was $77.1 million, or
38% of segment revenue.
Fluid Services
Fluid services revenue in the fourth quarter of 2015 decreased
7% to $58.5 million compared to
$62.6 million in the prior
quarter. Segment revenues declined due to seasonal and
weather-related factors, particularly in the Permian Basin and
Mid-Continent regions. During the fourth quarter of 2014,
this segment generated $93.8 million
in revenue.
The weighted average number of fluid services trucks decreased
1% to 1,002 during the fourth quarter of 2015, compared to 1,012
during the third quarter of 2015 and 1,043 during the fourth
quarter of 2014. Truck hours of 557,000 during the fourth
quarter of 2015 represented a decrease of 1% from the 565,000
generated in the third quarter of 2015 and a decrease of 16%
compared to 662,000 in the same period in 2014.
The average revenue per fluid service truck decreased 6% to
$58,000 from $62,000 in the third quarter of 2015, as disposal
utilization and skim oil sales dropped with trucking activity. In
the comparable quarter of 2014, average revenue per fluid truck was
$90,000.
Segment profit in the fourth quarter of 2015 was $12.5 million, compared to a profit of
$14.9 million in the prior quarter.
Segment profit margin decreased 240 basis points to 21% due to
continued pricing concessions and decremental margins on the lower
revenue base. Segment profit in the same period in 2014 was
$26.6 million, or 28% of segment
revenue.
Well Servicing
Well servicing revenues decreased 25% to $41.5 million during the fourth quarter of 2015
compared to $55.5 million in the
prior quarter. This line of business was most significantly
impacted from severe weather and also experienced other seasonal
impacts from less daylight hours and holidays. Well servicing
revenues were $88.0 million in the
fourth quarter of 2014. Revenues from the Taylor manufacturing
operations were $2.6 million in the
fourth quarter of 2015 compared to $4.1
million in the prior quarter and $3.0
million in the fourth quarter of 2014.
At December 31, 2015, the well
servicing rig count was 421, the same as the end of the prior
quarter and at December 31, 2014. Rig
hours were 120,000 in the fourth quarter of 2015, down 22% compared
to 154,100 in the previous quarter and down 41% from 204,400 hours
in the comparable quarter of last year. Rig utilization was 39% in
the fourth quarter of 2015, down from 50% in the prior quarter and
down from 67% in the fourth quarter of 2014.
Excluding revenues associated with the Taylor manufacturing
operations, revenue per well servicing rig hour was $324 in the fourth quarter of 2015, down 3%
compared to $334 in the previous
quarter and down 22% from $416
reported in the fourth quarter of 2014. The slight sequential
decline was due to pricing concessions given to customers and
declines in higher-rate services, such as plugging and
abandonment.
Segment profit in the fourth quarter of 2015 was $3.9 million, compared to $7.7 million in the prior quarter and
$19.8 million during the same period
in 2014. Segment profit margin decreased to 9.5% in the fourth
quarter of 2015 from 14% in the previous quarter. Fourth quarter
profit margin was negatively impacted by the severe weather in the
Permian Basin and Oklahoma, as
well as the seasonal decline. In the fourth quarter of 2014,
segment profit was 23% of segment revenue. Segment profit from the
Taylor manufacturing operations was a loss of $106,000 in the fourth quarter of 2015 compared
to profit of $311,000 in the prior
quarter.
Contract Drilling
Contract drilling revenues decreased by 34% to $2.6 million during the fourth quarter of 2015
from $3.8 million in the prior
quarter. During the fourth quarter of 2014, this segment generated
$15.7 million in revenue. Basic
operated 12 drilling rigs during the fourth quarter of 2015, the
same number of rigs as in the previous quarter as well as the
fourth quarter of 2014. However, only two rigs were active
during the majority of the fourth quarter. Revenue per drilling day
in the fourth quarter of 2015 was $16,500, up from $15,300 in the previous quarter but down slightly
from $16,600 in the fourth quarter of
2014. This increase is due to a lower-rate rig not working in
the fourth quarter.
Rig operating days during the fourth quarter of 2015 decreased
by 38% to 155 compared to 252 in the prior quarter, resulting in
rig utilization of 14% during the fourth quarter of 2015 compared
to 23% during the prior quarter. Rig operating days declined
due to diminishing capital and operational spending by our
customers. In the comparable period in 2014, rig operating
days were 948, producing a utilization of 86%.
Segment profit in the fourth quarter of 2015 was $69,000, a 90% decrease compared to profit of
$661,000 in the prior quarter and a
decrease from $5.1 million in the
fourth quarter of 2014. Segment margin for the fourth quarter
of 2015 was 3% of segment revenues compared to 17% from the prior
quarter, due to one fewer rig running during the fourth
quarter. Last year in the comparable period, segment margin
was 33%.
G&A Expense
General and administrative ("G&A") expense in the fourth
quarter of 2015 was $32.6 million, or
20% of revenue, compared to $36.0
million, or 19% of revenue, in the prior quarter. This 9%
decrease in G&A expense was primarily due to cost savings
initiatives and lower incentive compensation. G&A expense
in the fourth quarter of 2014 was $43.3
million, or 11% of revenue.
Tax Benefit
Basic's tax benefit for the fourth quarter of 2015 was
$29.8 million, compared to a tax
benefit of $56.5 million in the third
quarter of 2015. Excluding the goodwill write-down as mentioned
above, the tax benefit would have been $29.7
million for the third quarter. The tax benefit in the fourth
quarter of 2015 had an effective tax benefit rate of 35%, compared
to the prior quarter's effective tax adjusted benefit rate of 37%,
excluding the goodwill write-down. The tax benefit of $7.3 million in the fourth quarter of 2014
translated into an effective tax benefit rate of 28%.
Cash and Total Liquidity
On December 31, 2015, Basic had
cash and cash equivalents of approximately $46.7 million, down from $56.0 million at September
30, 2015 and $79.9 million on
December 31, 2014. At December 31, 2015, total liquidity was
approximately $140.1 million, which
included $93.4 million of
availability under Basic's $250
million revolving credit facility.
Capital Expenditures
Total capital expenditures during the twelve months of 2015 were
approximately $69.8 million
(including capital leases of $16.0
million), comprised of $21.4
million for expansion projects, $42.1
million for sustaining and replacement projects and
$6.3 million for other
projects. Expansion capital spending included $9.6 million for the completion and remedial
services segment, $8.5 million for
the well servicing segment, $2.0
million for the fluid services segment, and $1.3 million for the contact drilling
segment. Other capital expenditures were mainly for
facilities and IT infrastructure.
Basic expects 2016 capital expenditures to be approximately
$40.0 million, including $15.0 million of capital leases.
Conference Call
Basic will host a conference call to discuss its fourth quarter
and full year 2015 results on Friday,
February 19, 2016, at 9:00 a.m.
Eastern Time (8:00 a.m.
Central). To access the call, please dial (412) 902-0003 and
ask for the "Basic Energy Services" call at least 10 minutes prior
to the start time. The conference call will also be broadcast
live via the Internet and can be accessed through the investor
relations section of Basic's corporate website,
www.basicenergyservices.com.
A telephonic replay of the conference call will be available
until March 4, 2016 and may be
accessed by calling (201) 612-7415 and using pass code
13628606#. A webcast archive will be available at
www.basicenergyservices.com shortly after the call and will be
accessible for approximately 30 days.
About Basic Energy Services
Basic Energy Services provides well site services essential to
maintaining production from the oil and gas wells within its
operating area. The company employs more than 3,800 employees
in more than 100 service points throughout the major oil and gas
producing regions in Texas,
Louisiana, Oklahoma, New
Mexico, Arkansas,
Kansas, and the Rocky Mountain and
Appalachian regions. Additional information on Basic Energy
Services is available on the Company's website at
www.basicenergyservices.com.
Safe Harbor Statement
This release includes forward-looking statements and
projections, made in reliance on the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995. Basic has
made every reasonable effort to ensure that the information and
assumptions on which these statements and projections are based are
current, reasonable, and complete. However, a variety of
factors could cause actual results to differ materially from the
projections, anticipated results or other expectations expressed in
this release, including (i) changes in demand for our services and
any related material impact on our pricing and utilizations rates,
(ii) Basic's ability to execute, manage and integrate acquisitions
successfully, (iii) changes in our expenses, including labor or
fuel costs and financing costs, (iv) continued volatility of oil or
natural gas prices, and any related changes in expenditures by our
customers, and (v) competition within our industry.
Additional important risk factors that could cause actual results
to differ materially from expectations are disclosed in Item 1A of
Basic's Form 10-K for the year ended December 31, 2014 and subsequent Form 10-Qs filed
with the SEC. While Basic makes these statements and
projections in good faith, neither Basic nor its management can
guarantee that anticipated future results will be achieved.
Basic assumes no obligation to publicly update or revise any
forward-looking statements made herein or any other forward-looking
statements made by Basic, whether as a result of new information,
future events, or otherwise.
Contacts:
|
Alan
Krenek,
|
|
Chief Financial
Officer
|
|
Basic Energy
Services, Inc.
|
|
817-334-4100
|
|
|
|
Jack Lascar/Stephanie
Zhadkevich
|
|
Dennard ▪ Lascar
Associates
|
|
713-529-6600
|
-Tables to Follow-
Basic Energy
Services, Inc.
|
Consolidated
Statements of Operations and Other Financial Data
|
(in thousands,
except per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
December 31,
|
|
Year ended
December 31,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Statement
Data:
|
(Unaudited)
|
|
(Unaudited)
|
Revenues:
|
|
|
|
|
|
|
|
|
|
|
|
Completion and remedial
services
|
$
|
58,479
|
|
$
|
203,367
|
|
$
|
307,550
|
|
$
|
698,917
|
Fluid
services
|
|
58,460
|
|
|
93,772
|
|
|
258,597
|
|
|
369,774
|
Well
servicing
|
|
41,544
|
|
|
88,024
|
|
|
217,245
|
|
|
361,683
|
Contract
drilling
|
|
2,552
|
|
|
15,748
|
|
|
22,207
|
|
|
60,910
|
Total
revenues
|
|
161,035
|
|
|
400,911
|
|
|
805,599
|
|
|
1,491,284
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
Completion and remedial
services
|
|
49,983
|
|
|
126,224
|
|
|
245,069
|
|
|
434,457
|
Fluid
services
|
|
45,938
|
|
|
67,148
|
|
|
196,155
|
|
|
265,105
|
Well
servicing
|
|
37,638
|
|
|
68,201
|
|
|
184,952
|
|
|
270,344
|
Contract
drilling
|
|
2,477
|
|
|
10,612
|
|
|
16,674
|
|
|
41,513
|
General and
administrative (1)
|
|
32,603
|
|
|
43,272
|
|
|
143,464
|
|
|
167,301
|
Depreciation and
amortization
|
|
59,983
|
|
|
59,504
|
|
|
241,471
|
|
|
217,480
|
Goodwill
impairment
|
|
--
|
|
|
34,703
|
|
|
81,877
|
|
|
34,703
|
Loss on disposal of
assets
|
|
483
|
|
|
758
|
|
|
1,602
|
|
|
1,974
|
Total
expenses
|
|
229,105
|
|
|
410,422
|
|
|
1,111,264
|
|
|
1,432,877
|
Operating
income (loss)
|
|
(68,070)
|
|
|
(9,511)
|
|
|
(305,665)
|
|
|
58,407
|
Other income
(expense):
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense
|
|
(17,018)
|
|
|
(16,788)
|
|
|
(67,964)
|
|
|
(67,042)
|
Interest
income
|
|
9
|
|
|
3
|
|
|
26
|
|
|
40
|
Other income
|
|
79
|
|
|
163
|
|
|
528
|
|
|
775
|
Loss before income
taxes
|
|
(85,000)
|
|
|
(26,133)
|
|
|
(373,075)
|
|
|
(7,820)
|
Income tax benefit
(expense)
|
|
29,816
|
|
|
7,325
|
|
|
131,330
|
|
|
(521)
|
Net loss
|
$
|
(55,184)
|
|
$
|
(18,808)
|
|
$
|
(241,745)
|
|
$
|
(8,341)
|
Loss per share of
common stock:
|
|
|
|
|
|
|
|
|
|
|
|
Basic
|
$
|
(1.36)
|
|
$
|
(0.45)
|
|
$
|
(5.97)
|
|
$
|
(0.20)
|
Diluted
|
$
|
(1.36)
|
|
$
|
(0.45)
|
|
$
|
(5.97)
|
|
$
|
(0.20)
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Financial
Data:
|
|
|
|
|
|
|
|
|
|
|
|
EBITDA (3)
|
$
|
(8,008)
|
|
$
|
50,156
|
|
$
|
(63,666)
|
|
$
|
276,662
|
Adjusted EBITDA
(3)
|
|
(7,525)
|
|
|
85,617
|
|
|
24,313
|
|
|
317,952
|
Capital
expenditures:
|
|
|
|
|
|
|
|
|
|
|
|
Acquisitions, net of
cash acquired
|
|
--
|
|
|
--
|
|
|
7,914
|
|
|
16,090
|
Property and
equipment
|
|
6,580
|
|
|
51,370
|
|
|
53,868
|
|
|
236,295
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As
of
|
|
|
|
|
|
|
|
December 31,
2015
|
|
December 31,
2014
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
Balance Sheet
Data:
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
|
46,732
|
|
$
|
79,915
|
|
|
|
|
|
|
Net property and
equipment
|
|
846,290
|
|
|
1,007,969
|
|
|
|
|
|
|
Total
assets
|
|
1,161,369
|
|
|
1,597,177
|
|
|
|
|
|
|
Total long-term
debt
|
|
838,368
|
|
|
882,572
|
|
|
|
|
|
|
Total stockholders'
equity
|
|
106,338
|
|
|
342,653
|
|
|
|
|
|
|
|
|
|
|
|
Three months
ended
December 31,
|
|
Year ended
December 31,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Segment
Data:
|
(Unaudited)
|
|
(Unaudited)
|
Completion and
Remedial Services
|
|
|
|
Segment profits as a
percent of revenue
|
|
14.5%
|
|
|
37.9%
|
|
|
20.3%
|
|
|
37.8%
|
|
|
|
|
|
|
|
|
|
|
|
|
Fluid
Services
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of fluid service trucks
|
|
1,002
|
|
|
1,043
|
|
|
1,018
|
|
|
1,022
|
Truck hours
(000's)
|
|
557.0
|
|
|
661.9
|
|
|
2,291.2
|
|
|
2,545.8
|
Revenue per fluid
services truck (000's)
|
$
|
58
|
|
$
|
90
|
|
$
|
254
|
|
$
|
362
|
Segment profits per
fluid services truck (000's)
|
$
|
12
|
|
$
|
26
|
|
$
|
61
|
|
$
|
102
|
Segment profits as a
percent of revenue
|
|
21.4%
|
|
|
28.4%
|
|
|
24.1%
|
|
|
28.3%
|
|
|
|
|
|
|
|
|
|
|
|
|
Well Servicing
(2)
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of rigs
|
|
421
|
|
|
421
|
|
|
421
|
|
|
421
|
Rig hours
(000's)
|
|
120.0
|
|
|
204.4
|
|
|
592.7
|
|
|
845.8
|
Rig utilization
rate
|
|
39%
|
|
|
67%
|
|
|
49%
|
|
|
70%
|
Revenue per rig hour,
excluding manufacturing
|
$
|
324
|
|
$
|
416
|
|
$
|
348
|
|
$
|
409
|
Well servicing rig
profit per rig hour
|
$
|
33
|
|
$
|
97
|
|
$
|
54
|
|
$
|
105
|
Segment profits as a
percent of revenue
|
|
9.4%
|
|
|
22.5%
|
|
|
14.9%
|
|
|
25.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
Contract
Drilling
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average
number of rigs
|
|
12
|
|
|
12
|
|
|
12
|
|
|
12
|
Rig operating
days
|
|
155
|
|
|
948
|
|
|
1361
|
|
|
3,679
|
Revenue per
day
|
$
|
16,500
|
|
$
|
16,600
|
|
$
|
16,300
|
|
$
|
16,600
|
Drilling rig profit
per day
|
$
|
400
|
|
$
|
5,400
|
|
$
|
4,000
|
|
$
|
5,300
|
Segment profits as a
percent of revenue
|
|
2.7%
|
|
|
32.6%
|
|
|
24.9%
|
|
|
31.8%
|
(1)
|
Includes
approximately $3,632,000 and $3,968,000 of non-cash compensation
expense for the three months ended December 31, 2015 and 2014,
respectively, and $16,922,000 and $15,440,000 for the year ended
December 31, 2015 and 2014, respectively.
|
|
|
(2)
|
Excludes Basic's
barge rig operations that were sold on March 31, 2014.
|
|
|
|
(3)
|
This earnings release
contains references to the non-GAAP financial measure of earnings
(net income) before interest, taxes, depreciation and amortization,
or "EBITDA." This earnings release also contains references
to the non-GAAP financial measure of earnings (net income) before
interest, taxes, depreciation, amortization, loss on goodwill
impairment, loss on legal settlements, loss on customer audit
settlements, and the gain or loss on disposal of assets or
"Adjusted EBITDA." EBITDA and Adjusted EBITDA should not be
considered in isolation or as a substitute for operating income,
net income or loss, cash flows provided by operating, investing and
financing activities, or other income or cash flow statement data
prepared in accordance with GAAP. However, Basic believes
EBITDA and Adjusted EBITDA are useful supplemental financial
measures used by its management and directors and by external users
of its financial statements, such as investors, to
assess:
|
|
|
|
•
|
The financial
performance of its assets without regard to financing methods,
capital structure or historical cost basis;
|
|
•
|
The ability of its
assets to generate cash sufficient to pay interest on its
indebtedness; and
|
|
•
|
Its operating
performance and return on invested capital as compared to those of
other companies in the well servicing industry, without regard to
financing methods and capital structure.
|
|
|
|
|
EBITDA and Adjusted
EBITDA each have limitations as an analytical tool and should not
be considered an alternative to net income, operating income, cash
flow from operating activities or any other measure of financial
performance or liquidity presented in accordance with GAAP. EBITDA
and Adjusted EBITDA exclude some, but not all, items that affect
net income and operating income, and these measures may vary among
other companies. Limitations to using EBITDA as an analytical tool
include:
|
|
|
|
•
|
EBITDA does not
reflect its current or future requirements for capital expenditures
or capital commitments;
|
|
•
|
EBITDA does not
reflect changes in, or cash requirements necessary, to service
interest or principal payments on, its debt;
|
|
•
|
EBITDA does not
reflect income taxes;
|
|
•
|
Although depreciation
and amortization are non-cash charges, the assets being depreciated
and amortized will often have to be replaced in the future, and
EBITDA does not reflect any cash requirements for such
replacements; and
|
|
•
|
Other companies in
its industry may calculate EBITDA differently than Basic does,
limiting its usefulness as a comparative measure.
|
|
|
|
|
In addition to each
of the limitations with respect to EBITDA noted above, the
limitations to using Adjusted EBITDA as an analytical tool
include:
|
|
|
|
•
|
Adjusted EBITDA does
not reflect Basic's gain or loss on disposal of assets;
|
|
•
|
Adjusted EBITDA does
not reflect Basic's loss on goodwill impairment;
|
|
•
|
Adjusted EBITDA does
not reflect Basic's loss on legal settlements
|
|
•
|
Adjusted EBITDA does
not reflect Basic's loss on customer audit settlements;
and
|
|
•
|
Other companies in
our industry may calculate Adjusted EBITDA differently than Basic
does, limiting its usefulness as a comparative measure.
|
The following table presents a reconciliation of net loss to
EBITDA, which is the most comparable GAAP performance measure, for
each of the periods indicated:
|
Three months
ended
December 31,
|
|
Year ended
December 31,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Reconciliation of
Net Loss to EBITDA:
|
(Unaudited)
|
|
(Unaudited)
|
Net loss
|
$
|
(55,184)
|
|
$
|
(18,808)
|
|
$
|
(241,745)
|
|
$
|
(8,341)
|
Income
taxes
|
|
(29,816)
|
|
|
(7,325)
|
|
|
(131,330)
|
|
|
521
|
Net
interest expense
|
|
17,009
|
|
|
16,785
|
|
|
67,938
|
|
|
67,002
|
Depreciation and amortization
|
|
59,983
|
|
|
59,504
|
|
|
241,471
|
|
|
217,480
|
EBITDA
|
$
|
(8,008)
|
|
$
|
50,156
|
|
$
|
(63,666)
|
|
$
|
276,662
|
The following table presents a reconciliation of net loss to
"Adjusted EBITDA," which means our EBITDA excluding the gain or
loss on disposal of assets, loss on goodwill impairment, loss on
legal settlements, and loss on customer audit settlements:
|
Three months
ended
December 31,
|
|
Year ended
December 31,
|
|
2015
|
|
2014
|
|
2015
|
|
2014
|
Reconciliation of
Net Loss to Adjusted EBITDA:
|
(Unaudited)
|
|
(Unaudited)
|
Net loss
|
$
|
(55,184)
|
|
$
|
(18,808)
|
|
$
|
(241,745)
|
|
$
|
(8,341)
|
Income
taxes
|
|
(29,816)
|
|
|
(7,325)
|
|
|
(131,330)
|
|
|
521
|
Net
interest expense
|
|
17,009
|
|
|
16,785
|
|
|
67,938
|
|
|
67,002
|
Depreciation and amortization
|
|
59,983
|
|
|
59,504
|
|
|
241,471
|
|
|
217,480
|
Goodwill
impairment
|
|
--
|
|
|
34,703
|
|
|
81,877
|
|
|
34,703
|
Loss on disposal of
assets
|
|
483
|
|
|
758
|
|
|
1,602
|
|
|
1,974
|
Loss on legal
settlements
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,613
|
Loss on customer audit
settlement
|
|
—
|
|
|
—
|
|
|
4,500
|
|
|
—
|
Adjusted
EBITDA
|
$
|
(7,525)
|
|
$
|
85,617
|
|
$
|
24,313
|
|
$
|
317,952
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/basic-energy-services-reports-fourth-quarter-and-full-year-2015-results-300222763.html
SOURCE Basic Energy Services, Inc.