FOR IMMEDIATE RELEASE
For more information, contact:
Richard L. Bergmark, + 1 713 328 2101
Fax: +1 713 328 2151
CORE LAB REPORTS Q2 2012 EPS OF $1.16, EX-ITEMS;
Q2 2012 OPS MARGINS AT 31%, Y-O-Y INCREMENTAL MARGINS AT 65%;
2012 YTD FCF EQUALS $86 MILLION
AMSTERDAM (18 July 2012) - Core Laboratories N.V. (NYSE: "CLB US" and NYSE Euronext: "CLB NA") reported second quarter 2012 net income of $55,350,000 and earnings per diluted share ("EPS") of $1.16, an increase of 29% over year-ago second quarter totals, excluding the benefit from a lower effective tax rate, losses from foreign currency translations, and non-operational expense items, including NYSE Euronext listing-related fees; all "items" netting to a charge of $0.05 per share. US GAAP EPS was $1.11 for the quarter. Second quarter 2012 revenue increased 9% over prior year levels to $247,006,000 as North American rig counts were down slightly from year-end 2011 and international rig counts were up only 4% over year-ago totals. Second quarter 2012 operating income reached $76,024,000, ex-items, yielding operating margins of 31%, both all-time quarterly highs for Core. Year-over-year quarterly incremental margins, defined as the change in operating income divided by the change in revenue, ex-items, were 65%.
Free cash flow ("FCF"), defined as cash from operations in excess of capital expenditures, reached $39,508,000 for the quarter, and the Company's diluted share count was decreased to 47,791,000 shares. During the quarter, the Company returned almost $50,561,000 to its shareholders, equaling $1.06 per diluted share, by repurchasing 299,104 shares for approximately $37,271,000 and paying dividends of approximately $13,290,000.
The record second quarter resulted from the Company's continued focus on worldwide crude-oil related and large LNG projects, especially those involved with the development of deepwater fields offshore West and East Africa, the eastern Mediterranean, Brazil, and the Gulf of Mexico, underpinned by operational excellence. The number of projects related to the development of unconventional oil production from shale reservoirs in the United States remains at high levels.
Comparing the first six months of 2012 to the first half of 2011, Core's revenue increased 11% to $481,197,000; net income was up 23% to $106,867,000; and EPS was up 26% to $2.23. First half 2012 operating margins were 30%, up 390 basis points, over the year-earlier period, while FCF reached $86,000,000.
As reported the previous eleven quarters, the Board of Supervisory Directors (the “Board”) of Core Laboratories N.V. has established an internal performance metric of achieving a return on invested capital (“ROIC”) in the top decile of the service companies listed as Core's peers by Bloomberg Financial. Based on Bloomberg's calculations for the latest comparable data available, Core's ROIC was the highest in its oilfield services Comp Group. Moreover, the Company had the highest ROIC to Weighted Average Cost of Capital (“WACC”) ratio and the lowest WACC in the Comp Group.
Segment Highlights
Core Laboratories reports results under three operating segments: Reservoir Description, Production Enhancement, and Reservoir Management.
Reservoir Description
In the second quarter of 2012, Reservoir Description operations, which are mainly focused on deepwater international and Gulf of Mexico crude-oil projects, posted record quarterly revenue of $126,462,000, up 6% compared with year-ago levels even though total international rig counts were only up 4% year-over-year. Operating profit reached a quarterly record of $38,904,000, up 28%, ex-items, over the second quarter of 2011. Operating margins, ex-items, were a record 31%, up 500 basis points over year-earlier levels.
Reservoir Description's second quarter record revenue and record operating margins of 31% resulted, in part, from increasing client demand to measure reservoir rock and reservoir fluid properties at reservoir- condition temperatures and pressures, which are laboratory-based analyses that generate high margins. Moreover, the Company continued to avoid low-technology, low-margin, and low-ROIC projects by not offering outdated, ambient-condition core analysis testing at the well site. Compared with reservoir-condition core analysis, Core Laboratories has found that core analysis data sets generated at the well site are of much lower quality, and Core does not believe lower quality data provide value to oil companies.
Reservoir Description operations continued to work on large core analysis and crude-oil testing programs, in addition to reservoir fluids phase-behavior studies from deepwater offshore West and East Africa, the Eastern Mediterranean region, the Middle East, and Asia-Pacific areas. Thousands of feet of cores from Cretaceous and Tertiary-aged sedimentary fan reservoirs from both coasts of Africa are being analyzed to describe these complex petroleum systems. Hundreds of reservoir fluid samples consisting of crude oils, condensates, natural gases, and waters are being characterized for composition and phase-behavior relationships. The data sets will be used to plan the full-scale developments of these recent discoveries. Large Middle Eastern projects include the use of advanced rock properties and reservoir fluid characterizations to increase the productive capacity of existing fields, some of which have already been in production for decades. Asia-Pacific work continues offshore Malaysia, India, Indonesia, and Australia.
In deepwater Gulf of Mexico, Core worked on its largest project ever in the lower Tertiary section while providing integrated reservoir conditions reservoir rock and fluids data sets. Core also expanded the number of clients and number of projects from the deepwater to an all-time high. The Company expects industry activity levels to equal or surpass pre-moratorium levels during the third quarter of 2012.
From onshore in North America, thousands of feet of core from unconventional shale reservoirs are being characterized for their potential to produce oil and natural gas liquids. Sequences from the Permian basin, Bakken and Eagle Ford plays are undergoing extensive rock properties and advance rock properties testing to determine production and stimulation programs to maximize daily production and ultimate hydrocarbon recovery rates. Bakken cores are being tested for susceptibility and potential effectiveness of the use of light hydrocarbon gases and water flooding to enhance ultimate recovery rates.
Production Enhancement
Production Enhancement operations reported second quarter 2012 revenue of $99,547,000 and operating income of $30,148,000, up 12% and 23% respectively, over year-earlier quarterly totals, ex-items. Operating margins, ex-items, were up 300 basis points to 30%.
Production Enhancement continues to benefit from increasing market penetration and evolution of its patented and proprietary technologies and services. Core's HTD-BlastTM technology, which originally
delivered up to eight perforating guns to the toe portion of an extended reach horizontal well, has been significantly improved and the Company is now offering HTD-BlastTM XL. The HTD-BlastTM XL ( for eXtended Length) system has delivered up to 27 perforating guns in vertical well bores that penetrate sedimentary sequences that contain 20+ unconventional reservoirs, similar to sequences present in the Permian Basin. In addition, the gun firing sequence can be changed to ensure a more effective perforating event. The HTD-BlastTM XL system decreases an operator's cost while increasing the potential of the well bore to produce at higher daily rates and improving ultimate hydrocarbon recoveries from the reservoir. With further technological development, HTD-BlastTM XL will be deployable on coiled tubing in extended reach horizontal wells.
The Company's patented and proprietary diagnostics technology was used to determine the effectiveness of a large and complex stacked frac pack in Tertiary-aged reservoirs in the deepwater Gulf of Mexico. Diagnostics data sets were used by the operator to ensure that maximum production rates could be achieved for extended periods of time without interruption and well shut-in time.
Reservoir Management
Reservoir Management operations reported second quarter 2012 revenue of $20,997,000, up 15% from year-earlier totals and operating profit, ex-items, of $7,142,000 yielding operating margins of 34%.
Core's Eagle Ford Shale Study now has 39 industry participants as the Company continues to analyze thousands of feet of core from primarily the oil-prone areas in southwestern Texas. The industry also continues to have strong interest in unconventional oil reservoirs in the Permian basin as the Company has received dozens of cores, including two cores from the Wolfcamp section, each measuring over 1,000 feet, from which results will be included in the Company's Midland Basin Study. The Midland Basin Study has 28 industry participants.
The importance of Core's Granite Wash Regional Study was cited by an industry expert in a featured article in the July issue of the AAPG Explorer magazine. Study results helped the operator understand the complexities of the multiple-stacked reservoirs prevalent in the Granite Wash sequence unlocking the potential of trillions of cubic feet of natural gas and natural gas equivalents.
Internationally, Reservoir Management, in its continuing co-operation with Petrobras, now has six studies detailing the petroleum geology and reservoir potential of onshore and offshore Brazil. Core's newest study, Equatorial Basins of Western South America, contains cores and cutting samples from the multiple sedimentary basins in shallow and deepwater areas.
In addition, Core's Deepwater Campos Basin, Santos Basin, Cretaceous Carbonates of the Southeastern Margin and Pre-Salt Phase II Brazil studies now have over 30 industry participants. The combination of these studies contain the most comprehensive data sets of Cretaceous-aged carbonate sequences which make up the reservoir complex of offshore, deepwater pre-salt giant and super-giant field developments. Petrobras remains Core's largest and most important national oil company client.
Free Cash Flow, Share Repurchases, Dividends, Capital Returned To Shareholders
During the second quarter of 2012, Core Laboratories generated $47,105,000 of cash from operating activities and had capital expenditures of $7,597,000, yielding $39,508,000 in FCF. For the quarter, Core returned almost $50,561,000, or $1.06 per diluted share, to its shareholders in the forms of share repurchases and dividends. The FCF was used to pay approximately $13,290,000 in cash dividends, and to repurchase 299,104 shares at a cost of $37,271,000 while the average price paid per share since the inception of the repurchase program is approximately $25.00. Year-over-year, Core decreased its average diluted quarterly share count by approximately 2%, from 48,662,000 to 47,791,000.
On 16 April 2012, the Company's Board announced a quarterly cash dividend of $0.28 per share that was
paid in the second quarter of 2012. This amount represented a 12% increase over the quarterly dividends of $0.25 per share that were paid in 2011, and if paid each quarter of 2012, would equal a payout of $1.12 per share of common stock. The quarterly $0.28 per share cash dividend was paid on 25 May 2012 to shareholders of record on 27 April 2012. Dutch withholding tax was deducted from the dividend at the rate of 15%.
On 10 July 2012, the Board announced a cash dividend of $0.28 per share of common stock payable in the third quarter of 2012. The quarterly $0.28 per share cash dividend will be paid on 20 August 2012 to shareholders of record on 20 July 2012. Dutch withholding tax will be deducted from the dividend at a rate of 15%.
Return On Invested Capital
As reported in the previous eleven quarters, the Company's Board has established an internal performance metric of achieving an ROIC in the top decile of the oilfield service companies listed as Core's peers by Bloomberg Financial. The Company and its Board believe that ROIC is a leading performance metric used by shareholders to determine the relative investment value of publicly traded companies. Further, the Company and its Board believe shareholders will benefit if Core consistently performs in the highest ROIC decile among its Bloomberg peers. According to the latest financial information from Bloomberg, Core Laboratories' ROIC was the highest of any of the oilfield service companies listed in its Comp Group. Several of the peer companies failed to post ROIC that exceeded their WACC, thereby eroding capital and shareholder value. Core's ratio of ROIC to WACC is the highest, and its WACC is the lowest, of any company in the Comp Group.
Comp Group companies listed by Bloomberg include Halliburton, Schlumberger, Carbo Ceramics, FMC Technologies, Baker Hughes, Cameron International, Oceaneering, National Oilwell Varco, and Oil States International, among others. Core will update the ROIC for the oilfield services sector for the second quarter 2012 in its third quarter 2012 earnings release.
NYSE Euronext Amsterdam Stock Exchange Dual Listing
Core Laboratories completed its dual listing of shares on the NYSE Euronext Exchange in Amsterdam on Wednesday, 16 May 2012. In addition to continuing to trade on the NYSE under the symbol CLB US, the company also trades under the symbol CLB NA on the NYSE Euronext Amsterdam Exchange. No additional new shares were issued with this listing and European ownership of Core's shares has increased to approximately 7.2%, up from approximately 5% only two quarters ago.
Third Quarter 2012 Earnings Guidance and Full-Year 2012 Outlook
For 2012, the Company expects increasing international growth, especially in deepwater projects supported by the scheduled arrivals of additional deepwater rigs. Deepwater pre-salt activities in several international basins, such as the Kwanza Basin in offshore Angola, should increase for the remainder of 2012. In addition, Core should benefit from increasing activities in the deepwater Gulf of Mexico, which is projected to approach and surpass early 2008 highs by the third quarter of 2012. Core will also benefit from increasing activities in unconventional oil-shale reservoirs, not only in North America, but also South America and North Africa. The Company expects to generate $200,000,000 in revenue from primarily oil-shale reservoirs in 2012.
As a result of the Company's outlook, for the third quarter of 2012, Core expects revenue of approximately $250,000,000 to $260,000,000, with EPS between $1.17 and $1.25, where the midpoints of guidance represent a revenue increase of approximately 10% and EPS growth of 21% over third quarter 2011 totals, excluding year-ago non-operational gains and charges. Third quarter 2012 operating margins are projected to be approximately 31% with an expected effective tax rate of approximately 25%.
For 2012, Core expects to generate approximately $200,000,000 in free cash flow, an all-time high, while
increasing capital expenditures to an estimated $33,000,000. This capital program, the largest in the Company's history, is in response to anticipated strong client demand for Core's proprietary and patented technologies in 2012 and into 2013. Up to 80% of the 2012 capital program will address opportunities that are driven by increasing client activity levels, primarily in international areas. The Company will maintain its strict ROIC standard when deploying 2012 capital with the goal of Core remaining the industry leader for returns on invested capital.
The Company has scheduled a conference call to discuss Core's second quarter 2012 earnings announcement. The call will begin at 7:30 a.m. CDT on Thursday, 19 July 2012. To listen to the call, please go to Core's website at www.corelab.com.
Core Laboratories N.V. (www.corelab.com) is a leading provider of proprietary and patented reservoir description, production enhancement, and reservoir management services used to optimize petroleum reservoir performance. The Company has over 70 offices in more than 50 countries and is located in every major oil-producing province in the world.
This release includes forward-looking statements regarding the future revenue, profitability, business strategies and developments of the Company made in reliance upon the safe harbor provisions of Federal securities law. The Company's outlook is subject to various important cautionary factors, including risks and uncertainties related to the oil and natural gas industry, business conditions, international markets, international political climates and other factors as more fully described in the Company's 2011 Form 10-K filed on 15 February 2012, and in other securities filings. These important factors could cause the Company's actual results to differ materially from those described in these forward-looking statements. Such statements are based on current expectations of the Company's performance and are subject to a variety of factors, some of which are not under the control of the Company. Because the information herein is based solely on data currently available, and because it is subject to change as a result of changes in conditions over which the Company has no control or influence, such forward-looking statements should not be viewed as assurance regarding the Company's future performance. The Company undertakes no obligation to publicly update any forward looking statement to reflect events or circumstances that may arise after the date of this press release.
CORE LABORATORIES N.V. & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(amounts in thousands, except per share data)
(Unaudited)
|
| | | | | | | | | | | | | | | | | |
| | | | Three Months Ended | | Six Months Ended |
| | | | 30 June 2012 |
| 30 June 2011 | | 30 June 2012 | | 30 June 2011 |
| | | | | | | | | | |
| REVENUE | | $ | 247,006 |
| | $ | 225,785 |
| | $ | 481,197 |
| | $ | 432,518 |
|
| | | | | | | | | | |
| OPERATING EXPENSES: | | | | | | | | |
| | Costs of services and sales | | 156,380 |
| | 152,273 |
| | 305,520 |
| | 289,023 |
|
| | General and administrative expenses | | 10,205 |
| | 9,757 |
| | 20,379 |
| | 19,281 |
|
| | Depreciation and amortization | | 5,077 |
| | 5,805 |
| | 10,960 |
| | 11,636 |
|
| | Other (income) expense, net | | 3,218 |
| | 147 |
| | (1,694 | ) | | (1,724 | ) |
| | | | | | | | | | |
| OPERATING INCOME | | 72,126 |
| | 57,803 |
| | 146,032 |
| | 114,302 |
|
| Loss on exchange of Senior Exchangeable Notes | | — |
| | 210 |
| | — |
| | 839 |
|
| Interest expense | | 2,178 |
| | 2,499 |
| | 4,368 |
| | 4,859 |
|
| | | | | | | | | | |
| INCOME BEFORE INCOME TAX EXPENSE | | 69,948 |
| | 55,094 |
| | 141,664 |
| | 108,604 |
|
| INCOME TAX EXPENSE | | 16,997 |
| | 14,710 |
| | 34,783 |
| | 22,228 |
|
| NET INCOME | | 52,951 |
| | 40,384 |
| | 106,881 |
| | 86,376 |
|
NET INCOME (LOSS) ATTRIBUTABLE TO NON-CONTROLLING INTEREST | | 35 |
| | (67 | ) | | 14 |
| | (365 | ) |
NET INCOME ATTRIBUTABLE TO CORE LABORATORIES N.V. | | $ | 52,916 |
| | $ | 40,451 |
| | $ | 106,867 |
| | $ | 86,741 |
|
| | | | | | | | | | |
| Diluted Earnings Per Share: | $ | 1.11 |
| | $ | 0.83 |
| | $ | 2.23 |
| | $ | 1.77 |
|
| | | | | | | | | | |
| WEIGHTED AVERAGE DILUTED COMMON SHARES OUTSTANDING | 47,791 |
| | 48,662 |
| | 47,868 |
| | 48,942 |
|
| | | | | | | | | |
| SEGMENT INFORMATION: | | | | | | | |
| | | | | | | | |
| Revenue: | | | | | | | |
| Reservoir Description | $ | 126,462 |
| | $ | 118,758 |
| | $ | 242,568 |
| | $ | 226,379 |
|
| Production Enhancement | 99,547 |
| | 88,787 |
| | 196,280 |
| | 170,885 |
|
| Reservoir Management | 20,997 |
| | 18,240 |
| | 42,349 |
| | 35,254 |
|
| | Total | $ | 247,006 |
| | $ | 225,785 |
| | $ | 481,197 |
| | $ | 432,518 |
|
| | | | | | | | | | |
| Operating income (loss): | | | | | | | |
| Reservoir Description | $ | 38,076 |
| | $ | 26,629 |
| | $ | 70,491 |
| | $ | 53,067 |
|
| Production Enhancement | 29,564 |
| | 24,500 |
| | 63,095 |
| | 47,762 |
|
| Reservoir Management | 7,113 |
| | 7,307 |
| | 15,028 |
| | 13,971 |
|
| Corporate and other | (2,627 | ) | | (633 | ) | | (2,582 | ) | | (498 | ) |
| | Total | $ | 72,126 |
| | $ | 57,803 |
| | $ | 146,032 |
| | $ | 114,302 |
|
CORE LABORATORIES N.V. & SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEET
(amounts in thousands)
|
| | | | | | | | |
| ASSETS: | 30 June 2012 | | 31 December 2011 |
| | | (Unaudited) | | |
| Cash and Cash Equivalents | $ | 23,408 |
| | $ | 29,332 |
|
| Accounts Receivable, net | 170,707 |
| | 170,805 |
|
| Inventory | 58,181 |
| | 53,214 |
|
| Other Current Assets | 39,141 |
| | 33,197 |
|
| | Total Current Assets | 291,437 |
| | 286,548 |
|
| | | | | |
| Property, Plant and Equipment, net | 118,665 |
| | 115,295 |
|
| Intangibles, Goodwill and Other Long Term Assets, net | 212,571 |
| | 209,030 |
|
| | Total Assets | $ | 622,673 |
| | $ | 610,873 |
|
| | | | | |
| | | | | |
| LIABILITIES AND EQUITY: | | | |
| | | | | |
| Short-Term Debt & Lease Obligations | $ | 623 |
| | $ | 2,344 |
|
| Accounts Payable | 51,280 |
| | 57,639 |
|
| Other Current Liabilities | 74,274 |
| | 83,212 |
|
| | Total Current Liabilities | 126,177 |
| | 143,195 |
|
| | | | | |
| Long-Term Debt & Lease Obligations | $ | 206,053 |
| | $ | 223,075 |
|
| Other Long-Term Liabilities | 66,290 |
| | 62,948 |
|
| | | | |
| Total Equity | 224,153 |
| | 181,655 |
|
| | Total Liabilities and Equity | $ | 622,673 |
| | $ | 610,873 |
|
| | | | | |
CORE LABORATORIES N.V. & SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOW
(amounts in thousands)
(Unaudited)
|
| | | | | |
| | | | Six Months Ended |
| | | | 30 June 2012 |
| | | | |
| CASH FLOWS FROM OPERATING ACTIVITIES | $ | 100,894 |
|
| | | | |
| CASH FLOWS FROM INVESTING ACTIVITIES | (14,754 | ) |
| | | | |
| CASH FLOWS FROM FINANCING ACTIVITIES | (92,064 | ) |
| | | | |
| NET CHANGE IN CASH AND CASH EQUIVALENTS | (5,924 | ) |
| CASH AND CASH EQUIVALENTS, beginning of period | 29,332 |
|
| CASH AND CASH EQUIVALENTS, end of period | $ | 23,408 |
|
| | | | |
Non-GAAP Information
Management believes that the exclusion of certain income and expenses enables it to evaluate more effectively the Company's operations period-over-period and to identify operating trends that could otherwise be masked by the excluded Items. For this reason, we used certain non-GAAP measures that exclude these Items; and we feel that this presentation provides the public a clearer comparison with the numbers reported in prior periods.
Reconciliation of Operating Income
(amounts in thousands)
(Unaudited)
|
| | | | | | | | |
| | Three Months Ended | | Three Months Ended | |
| | 30 June 2012 | | 30 June 2011 | |
| | | | | |
| Operating income | $ | 72,126 |
| | $ | 57,803 |
| |
| NYSE Euronext listing-related costs | 683 |
| | — |
| |
| Legal entity realignment | 1,860 |
| | 711 |
| |
| One-time severance benefits and other personnel costs | — |
| | 3,665 |
| |
| Foreign exchange losses | 1,355 |
| | — |
| |
| Operating income excluding specific items | $ | 76,024 |
| | $ | 62,179 |
| |
| | | | | |
|
| | | | | | | | |
| | Reservoir Description | |
| | Three Months Ended | | Three Months Ended | |
| | 30 June 2012 | | 30 June 2011 | |
| | | | | |
| Operating income | $ | 38,076 |
| | $ | 26,629 |
| |
| One-time severance benefits and other personnel costs | — |
| | 3,665 |
| |
| Foreign exchange losses | 828 |
| | — |
| |
| Operating income excluding specific items | $ | 38,904 |
| | $ | 30,294 |
| |
| | | | | |
|
| | | | | | | |
| | Production Enhancement | | Reservoir Management |
| | Three Months Ended | | Three Months Ended |
| | 30 June 2012 | | 30 June 2012 |
| | | | |
| Operating income | $ | 29,564 |
| | $ | 7,113 |
|
| Foreign exchange losses | 584 |
| | 29 |
|
| Operating income excluding specific items | $ | 30,148 |
| | $ | 7,142 |
|
| | | | |
Reconciliation of Net Income
(amounts in thousands)
(Unaudited)
|
| | | | | | | | |
| | Three Months Ended | | Three Months Ended | |
| | 30 June 2012 | | 30 June 2011 | |
| | | | | |
| Net income | $ | 52,916 |
| | $ | 40,451 |
| |
| NYSE Euronext listing-related costs (net of tax) | 517 |
| | — |
| |
| Legal entity realignment (net of tax) | 1,408 |
| | 521 |
| |
| One-time severance benefits and other personnel costs (net of tax) | — |
| | 2,687 |
| |
| Foreign exchange losses (net of tax) | 1,026 |
| | — |
| |
| Loss on exchange of Notes | — |
| | 210 |
| |
| Impact of lower effective tax rate | (517 | ) | | — |
| |
| Net income excluding specific items | $ | 55,350 |
| | $ | 43,869 |
| |
| | | | | |
Reconciliation of Earnings Per Diluted Share
(Unaudited)
|
| | | | | | | | |
| | Three Months Ended | | Three Months Ended | |
| | 30 June 2012 | | 30 June 2011 | |
| | | | | |
| Earnings per diluted share | $ | 1.11 |
| | $ | 0.83 |
| |
| NYSE Euronext listing-related costs (net of tax) | 0.01 |
| | — |
| |
| Legal entity realignment (net of tax) | 0.03 |
| | 0.01 |
| |
| One-time severance benefits and other personnel costs (net of tax) | — |
| | 0.06 |
| |
| Foreign exchange losses (net of tax) | 0.02 |
| | — |
| |
| Loss on exchange of Notes | — |
| | — |
| |
| Impact of lower effective tax rate | (0.01 | ) | | — |
| |
| Earnings per diluted share excluding specific items | $ | 1.16 |
| | $ | 0.90 |
| |
Free Cash Flow
Core uses the non-GAAP measure of free cash flow to evaluate its cash flows and results of operations. Free cash flow is an important measurement because it represents the cash from operations, in excess of capital expenditures, available to operate the business and fund non-discretionary obligations. Free cash flow is not a measure of operating performance under GAAP, and should not be considered in isolation nor construed as an alternative consideration to operating income, net income, earnings per share, or cash flows from operating, investing, or financing activities, each as determined in accordance with GAAP. You should also not consider free cash flow as a measure of liquidity. Moreover, since free cash flow is not a measure determined in accordance with GAAP and thus is susceptible to varying interpretations and calculations, free cash flow as presented may not be comparable to similarly titled measures presented by other companies.
Computation of Free Cash Flow
(amounts in thousands)
(Unaudited)
|
| | | | | | | | |
| | | Three Months | | Six Months |
| | | Ended | | Ended |
| | | 30 June 2012 | | 30 June 2012 |
| | | | | |
| Net cash provided by operating activities | | $ | 47,105 |
| | $ | 100,894 |
|
| Capital expenditures | | (7,597 | ) | | (14,894 | ) |
| Free cash flow | | $ | 39,508 |
| | $ | 86,000 |
|
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