2500 CityWest Boulevard Suite 2200 Houston, TX 77042 (713) 361-2600 |
FOR IMMEDIATE RELEASE August 7, 2013 | Contact: Brent Smith Executive Vice President, Chief Financial Officer and Treasurer (713) 361-2634 |
· | Backlog: Contracted backlog was $400 million as of June 30, 2013 and does not include the recently awarded $40 million contract from Pemex. This compares to backlog of $172 million at December 31, 2012 and $238 million at June 30, 2012. Of the backlog as of June 30, 2013, $340 million relates to international work and the remainder relates to work in the U.S. Gulf of Mexico, with 70% of the total backlog expected to be performed during the remainder of 2013. |
· | Revenues: Second quarter 2013 revenues increased by $0.7 million to $121.0 million compared to the second quarter 2012. Although revenues were essentially flat, the consolidated revenue mix changed significantly. International revenues accounted for 65% and domestic revenues accounted for 35% of total consolidated revenues for the second quarter 2013, compared to 39% international and 61% domestic for the second quarter 2012. |
· | Gross Profit: Second quarter 2013 gross profit was $2.6 million, an improvement of $2.5 million compared to the second quarter 2012. The improvement from last year is primarily attributable to the cost saving initiatives the Company implemented during the second half of last year as well as improved margins in the Company's international markets. These improvements were partially offset by the deterioration in domestic results due to lower utilization of the Company's derrick barges. |
· | G&A: Second quarter 2013 G&A decreased by $2.0 million to $10.8 million compared to the second quarter 2012. The decrease is primarily due to lower stock based compensation expense and headcount reductions relating to the continuing effect of cost saving initiatives implemented during the second half of 2012. As a percentage of revenues, G&A was 8.9% for the second quarter 2013 compared to 10.7% for the second quarter 2012. |
· | Interest Expense: Second quarter 2013 net interest expense increased by $1.3 million to $4.6 million compared to the second quarter 2012, primarily due to non-cash interest expense relating to the accretion of the debt discount on the Company's convertible debt, and higher outstanding balances on the Company's revolving credit facility during the quarter to fund the up-front procurement of pipe and materials required under three of the Company's new contracts in Mexico. |
· | Income Tax: The effective tax benefit rate for the second quarter 2013 was 38.0% compared to a tax benefit rate of 38.4% for the second quarter 2012. The difference in the effective tax rate from the statutory rate is due to the mix of pre-tax profit and loss between U.S. and international taxing jurisdictions with varying statutory rates. |
· | Balance Sheet: As of June 30, 2013, total debt consisted of $86.25 million in convertible notes, $32.7 million under a senior secured term loan, $61.9 million outstanding under a revolving credit facility and $20.0 million under an unsecured term loan. Cash and cash equivalents were $8.5 million, for a net debt position of $192.3 million at June 30, 2013, compared to net debt positions of $151.8 million at December 31, 2012 and $148.7 million at June 30, 2012. The net secured debt amount that is subject to financial covenants was $94.6 million at June 30, 2013, $65.5 million at December 31, 2012 and $148.8 million at June 30, 2012. Total debt presented on the consolidated balance sheet at June 30, 2013 is net of a debt discount of $20.8 million on the Company's convertible debt. |
CAL DIVE INTERNATIONAL, INC. and SUBSIDIARIES Condensed Consolidated Statements of Operations (in thousands, except per share amounts) | |||||||||||||||||
Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||||||
(unaudited) | (unaudited) | ||||||||||||||||
Revenues | $ | 120,986 | $ | 120,321 | $ | 201,905 | $ | 180,338 | |||||||||
Cost of sales | 118,356 | 120,168 | 210,792 | 196,605 | |||||||||||||
Gross profit (loss ) | 2,630 | 153 | (8,887 | ) | (16,267 | ) | |||||||||||
General and administrative expenses | 10,802 | 12,846 | 22,711 | 26,338 | |||||||||||||
Asset impairment | - | - | 125 | 1,351 | |||||||||||||
(Gain) on sale of assets, net | (3,143 | ) | (3,522 | ) | (3,123 | ) | (3,333 | ) | |||||||||
Operating loss | (5,029 | ) | (9,171 | ) | (28,600 | ) | (40,623 | ) | |||||||||
Interest expense, net | 4,630 | 3,308 | 9,262 | 5,608 | |||||||||||||
Interest expense - adjustment to conversion feature of convertible debt | (6,425 | ) | - | (6,362 | ) | - | |||||||||||
Other (income) expense, net | 376 | 144 | 455 | (197 | ) | ||||||||||||
Loss before income taxes | (3,610 | ) | (12,623 | ) | (31,955 | ) | (46,034 | ) | |||||||||
Income tax benefit | (1,372 | ) | (4,851 | ) | (10,691 | ) | (13,240 | ) | |||||||||
Net loss | (2,238 | ) | (7,772 | ) | (21,264 | ) | (32,794 | ) | |||||||||
Loss attributable to noncontrolling interest | (570 | ) | (2,073 | ) | (1,946 | ) | (2,790 | ) | |||||||||
Loss attributable to Cal Dive | $ | (1,668 | ) | $ | (5,699 | ) | $ | (19,318 | ) | $ | (30,004 | ) | |||||
Loss per share attributable to Cal Dive: | |||||||||||||||||
Basic and diluted | $ | (0.02 | ) | $ | (0.06 | ) | $ | (0.21 | ) | $ | (0.32 | ) | |||||
Weighted average shares outstanding: | |||||||||||||||||
Basic and diluted | 93,748 | 92,678 | 93,808 | 92,699 | |||||||||||||
Other financial data: | |||||||||||||||||
Depreciation and amortization | $ | 13,631 | $ | 15,914 | $ | 27,811 | $ | 30,550 | |||||||||
Non-cash stock compensation expense | 1,406 | 2,000 | 2,854 | 4,378 | |||||||||||||
EBITDA | 10,202 | 10,672 | 3,681 | (1,282 | ) | ||||||||||||
CAL DIVE INTERNATIONAL, INC. and SUBSIDIARIES | ||||||||
Condensed Consolidated Balance Sheets | ||||||||
(in thousands) | ||||||||
June 30, | December 31, | |||||||
2013 | 2012 | |||||||
ASSETS | (unaudited) | |||||||
Current assets: | ||||||||
Cash | $ | 8,468 | $ | 8,343 | ||||
Accounts receivable, net | 127,177 | 135,205 | ||||||
Other current assets | 35,449 | 36,361 | ||||||
Total current assets | 171,094 | 179,909 | ||||||
Net property and equipment | 413,534 | 423,536 | ||||||
Other assets, net | 30,547 | 27,228 | ||||||
Total assets | $ | 615,175 | $ | 630,673 | ||||
LIABILITIES AND EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 67,383 | $ | 73,480 | ||||
Other current liabilities | 31,649 | 37,995 | ||||||
Current maturities of long-term debt | 13,989 | 4,219 | ||||||
Total current liabilities | 113,021 | 115,694 | ||||||
Long-term debt | 165,989 | 133,116 | ||||||
Derivative liability for conversion feature of convertible debt | - | 22,456 | ||||||
Other long-term liabilities | 77,880 | 91,132 | ||||||
Total liabilities | 356,890 | 362,398 | ||||||
Total equity | 258,285 | 268,275 | ||||||
Total liabilities and equity | $ | 615,175 | $ | 630,673 |
Reconciliation of Non-GAAP Financial Measures For the Periods Ended June 30, 2013 and 2012 (in thousands) | ||||||||||
In addition to net income, one primary measure that the Company uses to evaluate financial performance is earnings before net interest expense, taxes, depreciation and amortization, or EBITDA. The Company includes other non-cash items and adjustments in its definition of EBITDA outlined below. The Company uses EBITDA to measure operational strengths and the performance of its business and not to measure liquidity. EBITDA does not reflect the periodic costs of certain capitalized tangible and intangible assets used in generating revenues, and should be considered in addition to, and not as a substitute for, net income and other measures of financial performance reported in accordance with GAAP. Furthermore, EBITDA presentations may vary among companies; thus, the Company's EBITDA may not be comparable to similarly titled measures of other companies.
The Company believes EBITDA is useful as a measurement tool because it helps investors evaluate and compare operating performance from period to period by removing the impact of capital structure (primarily interest charges from outstanding debt) and asset base (primarily depreciation and amortization of vessels) from operating results. The Company's management uses EBITDA in communications with lenders, rating agencies and others, concerning financial performance.
The following table presents a reconciliation of EBITDA to income (loss) attributable to Cal Dive, which is the most directly comparable GAAP financial measure of the Company's operating results:
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||||||
2013 | 2012 | 2013 | 2012 | |||||||||||||
EBITDA (unaudited) | $ | 10,202 | $ | 10,672 | $ | 3,681 | $ | (1,282 | ) | |||||||
Less: Depreciation & amortization | 13,631 | 15,914 | 27,811 | 30,550 | ||||||||||||
Less: Income tax benefit | (1,372 | ) | (4,851 | ) | (10,691 | ) | (13,240 | ) | ||||||||
Less: Net interest expense | 4,630 | 3,308 | 9,262 | 5,608 | ||||||||||||
Less: Interest expense - conversion feature adjustment | (6,425 | ) | - | (6,362 | ) | - | ||||||||||
Less: Non-cash stock compensation expense | 1,406 | 2,000 | 2,854 | 4,378 | ||||||||||||
Less: Severance charges | - | - | - | 75 | ||||||||||||
Less: Non-cash impairment charges | - | - | 125 | 1,351 | ||||||||||||
Loss attributable to Cal Dive | $ | (1,668 | ) | $ | (5,699 | ) | $ | (19,318 | ) | $ | (30,004 | ) | ||||
As of 6/30/13 | ||||||||||||||||
Total Debt (1) | $ | 200,803 | ||||||||||||||
Less: Cash | (8,468 | ) | ||||||||||||||
Net Debt | $ | 192,335 | ||||||||||||||
(1) Total debt consists of outstanding balances on a revolver, secured term loan, unsecured term loan and the principal amount of convertible debt. |