Exhibit 99.1
 | NEWS RELEASE | |||
| Contacts: | James E. Braun, CFO Newpark Resources, Inc. 281-362-6800 | |||
FOR IMMEDIATE RELEASE | Ken Dennard, Managing Partner | |||
| Dennard Rupp Gray & Lascar, LLC | ||||
| ksdennard@drg-l.com | ||||
| 713-529-6600 |
NEWPARK RESOURCES REPORTS NET INCOME OF $0.15 PER DILUTED
SHARE FOR THE FOURTH QUARTER 2010
SHARE FOR THE FOURTH QUARTER 2010
Company achieves record Operating Income of $78.0 million in 2010
THE WOODLANDS, TX — February 17, 2011 — Newpark Resources, Inc. (NYSE: NR) today announced results for its fourth quarter and year ended December 31, 2010. Total revenues were $194.5 million for the fourth quarter of 2010 compared to $179.3 million for the third quarter of 2010 and $135.5 million for the fourth quarter of 2009. Net income for the fourth quarter of 2010 was $14.8 million, or $0.15 per diluted share, compared to net income for the third quarter of 2010 of $8.2 million, or $0.09 per diluted share, and net income for the fourth quarter of 2009 of $16,000, or break-even on a per share basis.
For the full year 2010, total revenues were $716.0 million compared to $490.3 million for the full year 2009. Net income for the full year of 2010 was $41.6 million, or $0.46 per diluted share, compared to a net loss of $20.6 million, or $0.23 per diluted share, for 2009.
Paul Howes, President and Chief Executive Officer of Newpark, stated, “We are extremely pleased with our strong fourth quarter results, which reflect solid revenue growth in Brazil within our Drilling Fluids business, along with continued growth in the Northeast within our Mats and Integrated Services business. Revenues from our Environmental Services business declined in the quarter due to the expected reductions in waste disposals associated with the Deepwater Horizon oil spill.
“Looking at our full year, 2010 operating income reached a record $78.0 million, an outstanding improvement from an operating loss in 2009. This accomplishment reflects the hard work and dedication of our employees following the challenges of 2009,” added Howes.
SEGMENT RESULTS
The Fluids Systems and Engineering segment generated revenues of $162.8 million in the fourth quarter of 2010 compared to $148.1 million in the third quarter of 2010 and $113.8 million in the fourth quarter of 2009. Segment operating income was $16.8 million in the fourth quarter of 2010 compared to $11.8 million in the third quarter of 2010 and $6.7 million in the fourth quarter of 2009. International revenues rose 41% from the third quarter of 2010, driven by a $14.2 million increase from Brazil. North American revenues were down 1% sequentially in the fourth quarter of 2010 as seasonal improvements in Canada were more than offset by a decline in the Company’s wholesale barite business. Compared to the fourth quarter of 2009, North American revenues increased 51%, while international revenues increased 30%. Operating margin in the fourth quarter of 2010 was 10.3%.
The Mats and Integrated Services segment generated revenues of $20.6 million in the fourth quarter of 2010 compared to $18.2 million in the third quarter of 2010 and $12.4 million in the fourth quarter of 2009. Segment operating income was $10.3 million in the fourth quarter of 2010 compared to operating income of $8.6 million in the third quarter of 2010 and $1.2 million in the fourth quarter of 2009. Revenues for the segment were up 13% from the third quarter of 2010, driven by a $2.2 million increase in rental activity in the Northeast U.S. region. Compared to the fourth quarter of 2009, segment revenues were up 66%. Operating margin in the fourth quarter of 2010 was 50.2%.
The Environmental Services segment generated revenues of $11.1 million in the fourth quarter of 2010 compared to $13.0 million in the third quarter of 2010 and $9.3 million in the fourth quarter of 2009. Segment operating income was $2.6 million in the fourth quarter of 2010 compared to operating income of $3.9 million in the third quarter of 2010 and $1.1 million in the fourth quarter of 2009. The fourth quarter of 2010 includes $3.1 million of revenue from waste disposals associated with the Deepwater Horizon oil spill compared to $5.4 million in the third quarter of 2010. Operating margin in the fourth quarter of 2010 was 23.4%.
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CONFERENCE CALL
Newpark has scheduled a conference call to discuss the fourth quarter and full year 2010 results, which will be broadcast live over the Internet, on Friday, February 18, 2011 at 10:00 a.m. Eastern Time / 9:00 a.m. Central Time. To participate in the call, dial 480-629-9771 and ask for the Newpark Resources conference call at least 10 minutes prior to the start time, or access it live over the Internet at www.newpark.com. For those who cannot listen to the live call, a replay will be available through February 25, 2011 and may be accessed by dialing (303) 590-3030 and using pass code 4398406#. Also, an archive of the webcast will be available shortly after the call at www.newpark.com for 90 days.
Newpark Resources, Inc. is a worldwide provider of drilling fluids, temporary worksites and access roads for oilfield and other commercial markets, and environmental waste treatment solutions. For more information, visit our website at www.newpark.com.
This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act that are based on management’s current expectations, estimates and projections. All statements that address expectations or projections about the future, including Newpark’s strategy for growth, product development, market position, expected expenditures and financial results are forward-looking statements. Some of the forward-looking statements may be identified by words like “expects,” “anticipates,” “plans,” “intends,” “projects,” “indicates,” and similar expressions. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, including those discussed more fully elsewhere in this release and in documents filed with the Securities and Exchange Commission by Newpark, particularly its Annual Report on Form 10-K for the year ended December 31, 2009, as well as others, could cause results to differ materially from those stated. These risk factors include, but are not limited to, our customer concentration and cyclical nature of our industry, the availability of raw materials and skilled personnel, our market competition, the cost and continued availability of borrowed funds, our international operations, legal and regulatory matters, including environmental regulations, inherent limitations in insurance coverage, potential impairments of long-lived intangible assets, technological developments in our industry, the impact of severe weather, particularly in the U.S. Gulf Coast, and restrictions on offshore drilling activity in the Gulf of Mexico. Newpark’s filings with the Securities and Exchange Commission can be obtained at no charge at www.sec.gov, as well as through our website at www.newpark.com.
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Newpark Resources, Inc.
Consolidated Statements of Operations
Consolidated Statements of Operations
(Unaudited)
| Three Months Ended | Year Ended | |||||||||||||||||||
| December 31, | September 30, | December 31, | December 31, | December 31, | ||||||||||||||||
| (In thousands, except per share data) | 2010 | 2010 | 2009 | 2010 | 2009 | |||||||||||||||
| Revenues | $ | 194,526 | $ | 179,278 | $ | 135,530 | $ | 715,954 | $ | 490,275 | ||||||||||
| Cost of revenues | 152,879 | 145,224 | 115,182 | 576,920 | 447,624 | |||||||||||||||
| Selling, general and administrative expenses | 16,722 | 16,662 | 15,686 | 64,157 | 61,205 | |||||||||||||||
| Other operating expense (income), net | 58 | (2,140 | ) | (476 | ) | (3,127 | ) | (3,229 | ) | |||||||||||
| Operating income (loss) | 24,867 | 19,532 | 5,138 | 78,004 | (15,325 | ) | ||||||||||||||
| Foreign currency exchange (gain) loss | (494 | ) | 1,184 | (298 | ) | (1,134 | ) | (1,870 | ) | |||||||||||
| Interest expense | 2,613 | 3,278 | 2,723 | 10,267 | 9,334 | |||||||||||||||
| Income (loss) from operations before income taxes | 22,748 | 15,070 | 2,713 | 68,871 | (22,789 | ) | ||||||||||||||
| Provision for income taxes | 7,978 | 6,836 | 2,697 | 27,245 | (2,216 | ) | ||||||||||||||
| Net income (loss) | $ | 14,770 | $ | 8,234 | $ | 16 | $ | 41,626 | $ | (20,573 | ) | |||||||||
| Income (loss) per common share — basic | $ | 0.16 | $ | 0.09 | $ | — | $ | 0.47 | $ | (0.23 | ) | |||||||||
| Income (loss) per common share — diluted | $ | 0.15 | $ | 0.09 | $ | — | $ | 0.46 | $ | (0.23 | ) | |||||||||
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Newpark Resources, Inc.
Operating Segment Results
Operating Segment Results
(Unaudited)
| Three Months Ended | ||||||||||||
| December 31, | September 30, | December 31, | ||||||||||
| (In thousands) | 2010 | 2010 | 2009 | |||||||||
Revenues | ||||||||||||
| Fluids systems and engineering | $ | 162,811 | $ | 148,140 | $ | 113,799 | ||||||
| Mats and integrated services | 20,610 | 18,186 | 12,397 | |||||||||
| Environmental services | 11,105 | 12,952 | 9,334 | |||||||||
| Total revenues | $ | 194,526 | $ | 179,278 | $ | 135,530 | ||||||
Operating income (loss) | ||||||||||||
| Fluids systems and engineering | $ | 16,811 | $ | 11,845 | $ | 6,749 | ||||||
| Mats and integrated services | 10,342 | 8,592 | (1) | 1,227 | ||||||||
| Environmental services | 2,600 | 3,944 | 1,099 | |||||||||
| Corporate office | (4,886 | ) | (4,849 | ) | (3,937 | ) | ||||||
| Total operating income | $ | 24,867 | $ | 19,532 | $ | 5,138 | ||||||
Segment operating margin | ||||||||||||
| Fluids systems and engineering | 10.3 | % | 8.0 | % | 5.9 | % | ||||||
| Mats and integrated services | 50.2 | % | 47.2 | % | 9.9 | % | ||||||
| Environmental services | 23.4 | % | 30.5 | % | 11.8 | % | ||||||
| (1) | Includes $2.2 million of income reflecting proceeds from the settlement of a lawsuit. |
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Newpark Resources, Inc.
Consolidated Balance Sheets
Consolidated Balance Sheets
(Unaudited)
| December 31, | December 31, | |||||||
| (In thousands, except share data) | 2010 | 2009 | ||||||
ASSETS | ||||||||
| Cash and cash equivalents | $ | 83,010 | $ | 11,534 | ||||
| Receivables, net | 196,799 | 122,386 | ||||||
| Inventories | 123,028 | 115,495 | ||||||
| Deferred tax asset | 27,654 | 7,457 | ||||||
| Prepaid expenses and other current assets | 10,036 | 11,740 | ||||||
| Total current assets | 440,527 | 268,612 | ||||||
| Property, plant and equipment, net | 212,655 | 224,625 | ||||||
| Goodwill | 62,307 | 62,276 | ||||||
| Other intangible assets, net | 13,072 | 16,037 | ||||||
| Other assets | 8,781 | 13,564 | ||||||
| Total assets | $ | 737,342 | $ | 585,114 | ||||
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||||||||
| Foreign bank lines of credit | $ | 1,458 | $ | 6,901 | ||||
| Current maturities of long-term debt | 148 | 10,319 | ||||||
| Accounts payable | 66,316 | 62,992 | ||||||
| Accrued liabilities | 43,234 | 25,290 | ||||||
| Total current liabilities | 111,156 | 105,502 | ||||||
| Long-term debt, less current portion | 172,987 | 105,810 | ||||||
| Deferred tax liability | 31,549 | 2,083 | ||||||
| Other noncurrent liabilities | 4,303 | 3,697 | ||||||
| Total liabilities | 319,995 | 217,092 | ||||||
| Common stock, $0.01 par value, 200,000,000 shares authorized and 93,143,102 and 91,672,871 shares issued, respectively | 931 | 917 | ||||||
| Paid-in capital | 468,503 | 460,544 | ||||||
| Accumulated other comprehensive income | 8,581 | 8,635 | ||||||
| Retained deficit | (45,034 | ) | (86,660 | ) | ||||
| Treasury stock, at cost; 2,766,912 and 2,727,765 shares, respectively | (15,634 | ) | (15,414 | ) | ||||
| Total stockholders’ equity | 417,347 | 368,022 | ||||||
| Total Liabilities and Stockholders’ Equity | $ | 737,342 | $ | 585,114 | ||||
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Newpark Resources, Inc.
Consolidated Statements of Cash Flows
Consolidated Statements of Cash Flows
(unaudited)
| (In thousands) | 2010 | 2009 | ||||||
Cash flows from operating activities: | ||||||||
| Net income (loss) | $ | 41,626 | $ | (20,573 | ) | |||
| Adjustments to reconcile net income (loss) to net cash provided by operations: | ||||||||
| Non-cash impairment charges | 225 | 1,166 | ||||||
| Depreciation and amortization | 27,010 | 28,138 | ||||||
| Stock-based compensation expense | 3,876 | 3,437 | ||||||
| Provision for deferred income taxes | 18,030 | (6,916 | ) | |||||
| Provision for doubtful accounts | 478 | 2,301 | ||||||
| (Gain) loss on sale of assets | (257 | ) | 233 | |||||
| Change in assets and liabilities: | ||||||||
| (Increase) decrease in receivables | (75,829 | ) | 89,340 | |||||
| (Increase) decrease in inventories | (8,085 | ) | 35,182 | |||||
| Decrease (increase) in other assets | 1,898 | (800 | ) | |||||
| Increase (decrease) in accounts payable | 2,810 | (28,710 | ) | |||||
| Increase (decrease) in accrued liabilities and other | 19,694 | (13,979 | ) | |||||
Net cash provided by operating activities | 31,476 | 88,819 | ||||||
Cash flows from investing activities: | ||||||||
| Capital expenditures | (12,134 | ) | (18,544 | ) | ||||
| Proceeds from sale of property, plant and equipment | 1,585 | 1,400 | ||||||
Net cash used in investing activities | (10,549 | ) | (17,144 | ) | ||||
Cash flows from financing activities: | ||||||||
| Borrowings on lines of credit | 141,497 | 116,000 | ||||||
| Payments on lines of credit | (231,613 | ) | (171,701 | ) | ||||
| Principal payments on notes payable and long-term debt | (30,457 | ) | (10,439 | ) | ||||
| Proceeds from senior notes, net of offering costs | 167,756 | — | ||||||
| Proceeds from employee stock plans | 3,591 | 143 | ||||||
| Purchase of treasury stock | (153 | ) | (268 | ) | ||||
Net cash provided by (used in) financing activities | 50,621 | (66,265 | ) | |||||
| Effect of exchange rate changes on cash | (72 | ) | (2,128 | ) | ||||
| Net increase in cash and cash equivalents | 71,476 | 3,282 | ||||||
| Cash and cash equivalents at beginning of year | 11,534 | 8,252 | ||||||
| Cash and cash equivalents at end of year | $ | 83,010 | $ | 11,534 | ||||
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