Document_and_Entity_Informatio
Document and Entity Information Document | 3 Months Ended | |
Mar. 31, 2014 | Apr. 18, 2014 | |
Document Information [Line Items] | ' | ' |
Entity Registrant Name | 'OCEANEERING INTERNATIONAL INC | ' |
Entity Central Index Key | '0000073756 | ' |
Current Fiscal Year End Date | '--12-31 | ' |
Entity Filer Category | 'Large Accelerated Filer | ' |
Document Type | '10-Q | ' |
Document Period End Date | 31-Mar-14 | ' |
Document Fiscal Year Focus | '2014 | ' |
Document Fiscal Period Focus | 'Q1 | ' |
Amendment Flag | 'false | ' |
Entity Common Stock, Shares Outstanding | ' | 108,001,960 |
Consolidated_Balance_Sheets
Consolidated Balance Sheets (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Current Assets: | ' | ' |
Cash and cash equivalents | $106,339 | $91,430 |
Accounts receivable, net of allowances for doubtful accounts | 785,089 | 768,842 |
Inventory | 437,873 | 441,789 |
Other current assets | 126,938 | 131,214 |
Total Current Assets | 1,456,239 | 1,433,275 |
Property and Equipment, at cost | 2,489,805 | 2,380,888 |
Less accumulated depreciation | 1,244,307 | 1,191,789 |
Net Property and Equipment | 1,245,498 | 1,189,099 |
Other Assets: | ' | ' |
Goodwill | 347,909 | 344,018 |
Investments in unconsolidated affiliates | 36,403 | 37,462 |
Other non-current assets | 126,564 | 124,646 |
Total Other Assets | 510,876 | 506,126 |
Total Assets | 3,212,613 | 3,128,500 |
Current Liabilities: | ' | ' |
Accounts payable | 143,323 | 129,632 |
Accrued liabilities | 469,856 | 516,628 |
Income taxes payable | 82,262 | 80,828 |
Total Current Liabilities | 695,441 | 727,088 |
Long-term Debt | 90,000 | 0 |
Other Long-term Liabilities | 336,812 | 357,972 |
Commitments and Contingencies | ' | ' |
Stockholders' Equity: | ' | ' |
Common Stock | 27,709 | 27,709 |
Additional paid-in capital | 214,376 | 222,402 |
Treasury stock, at cost | -102,259 | -75,736 |
Retained earnings | 1,989,026 | 1,921,642 |
Accumulated other comprehensive income | -38,492 | -52,577 |
Total Shareholders' Equity | 2,090,360 | 2,043,440 |
Total Liabilities and Sharesholders' Equity | $3,212,613 | $3,128,500 |
Consolidated_Balance_Sheets_Pa
Consolidated Balance Sheets (Parentheticals) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, except Share data, unless otherwise specified | ||
Accounts receivable, allowances for doubtful accounts | $4,453 | $4,168 |
Common Stock, par value | $0.25 | $0.25 |
Common Stock, shares authorized | 180,000,000 | 180,000,000 |
Common Stock, shares issued | 110,834,088 | 110,834,088 |
Treasury stock, shares | 2,832,355 | 2,636,644 |
Consolidated_Statements_Of_Inc
Consolidated Statements Of Income (USD $) | 3 Months Ended | |
In Thousands, except Per Share data, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Revenue | $840,201 | $718,552 |
Cost of services and products | 650,710 | 558,177 |
Gross Profit | 189,491 | 160,375 |
Selling, general and administrative expense | 56,629 | 52,085 |
Income from Operations | 132,862 | 108,290 |
Interest income | 79 | 190 |
Interest expense | -411 | -763 |
Equity earnings (losses) of unconsolidated affiliates | -36 | 161 |
Other income (expense), net | 294 | 1,390 |
Income before Income Taxes | 132,788 | 109,268 |
Provision for income taxes | 41,563 | 34,419 |
Net Income | $91,225 | $74,849 |
Cash Dividends declared per Share | $0.22 | $0.18 |
Basic Earnings per Share | $0.84 | $0.69 |
Diluted Earnings per Share | $0.84 | $0.69 |
Consolidated_Statements_of_Com
Consolidated Statements of Comprehensive Income (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Net Income | $91,225 | $74,849 |
Other comprehensive income, net of tax: | ' | ' |
Foreign currency translation adjustments | 14,085 | -38,500 |
Total other comprehensive income | 14,085 | -38,500 |
Total Comprehensive Income | $105,310 | $36,349 |
Consolidated_Statements_Of_Cas
Consolidated Statements Of Cash Flows (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Cash Flows from Operating Activities: | ' | ' |
Net Income | $91,225 | $74,849 |
Adjustments to reconcile net income to net cash provided by operating activities: | ' | ' |
Depreciation and amortization | 53,351 | 49,852 |
Deferred income tax provision | 7,102 | 1,911 |
Net loss (gain) on sales of property and equipment | -1,305 | -1 |
Noncash compensation | 5,096 | 4,487 |
Distributions of accumulated earnings of unconsolidated affiliates | 0 | 363 |
Excluding the effects of acquisitions, increase (decrease) in cash from: | ' | ' |
Accounts receivable | -16,247 | 48,192 |
Inventory | 3,916 | -23,727 |
Other operating assets | -12,737 | 92 |
Currency translation effect on working capital | 6,291 | -10,431 |
Current liabilities | -40,201 | -24,817 |
Other operating liabilities | -14,137 | -9 |
Total adjustments to net income | -8,871 | 45,912 |
Net Cash Provided by Operating Activities | 82,354 | 120,761 |
Cash Flows from Investing Activities: | ' | ' |
Purchases of property and equipment | -104,038 | -94,177 |
Distributions of capital from unconsolidated affiliates | 1,024 | 1,184 |
Dispositions of property and equipment | 1,593 | 24 |
Net Cash Used in Investing Activities | -101,421 | -92,969 |
Cash Flows from Financing Activities: | ' | ' |
Net proceeds (payments) of revolving credit facility | 90,000 | -4,000 |
Excess tax benefits from employee benefit plans | 3,083 | 3,124 |
Payments of Dividends | -23,841 | -19,475 |
Repurchases of treasury stock | -35,266 | 0 |
Net Cash Provided by (Used in) Financing Activities | 33,976 | -20,351 |
Net Increase (Decrease) in Cash and Cash Equivalents | 14,909 | 7,441 |
Cash and Cash Equivalents-Beginning of Period | 91,430 | 120,549 |
Cash and Cash Equivalents-End of Period | $106,339 | $127,990 |
Summary_Of_Major_Accounting_Po
Summary Of Major Accounting Policies | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Summary Of Major Accounting Policies | ' |
SUMMARY OF MAJOR ACCOUNTING POLICIES | |
Basis of Presentation. We have prepared these unaudited consolidated financial statements pursuant to instructions for quarterly reports on Form 10-Q, which we are required to file with the U.S. Securities and Exchange Commission. These financial statements do not include all information and footnotes normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). These financial statements reflect all adjustments that we believe are necessary to present fairly our financial position at March 31, 2014 and our results of operations and cash flows for the periods presented. Except as otherwise disclosed herein, all such adjustments are of a normal and recurring nature. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in our annual report on Form 10-K for the year ended December 31, 2013. The results for interim periods are not necessarily indicative of annual results. | |
Principles of Consolidation. The consolidated financial statements include the accounts of Oceaneering International, Inc. and our 50% or more owned and controlled subsidiaries. We also consolidate entities that are determined to be variable interest entities if we determine that we are the primary beneficiary; otherwise, we account for those entities using the equity method of accounting. We use the equity method to account for our investments in unconsolidated affiliated companies of which we own an equity interest of between 20% and 50% and as to which we have significant influence, but not control, over operations. All significant intercompany accounts and transactions have been eliminated. | |
Use of Estimates. The preparation of financial statements in conformity with U.S. GAAP requires that our management make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. | |
Cash and Cash Equivalents. Cash and cash equivalents include demand deposits and highly liquid investments with original maturities of three months or less from the date of the investment. | |
Accounts Receivable – Allowances for Doubtful Accounts. We determine the need for allowances for doubtful accounts using the specific identification method. We do not generally require collateral from our customers. | |
Inventory. Inventory is valued at lower of cost or market. We determine cost using the weighted-average method. | |
Property and Equipment. We provide for depreciation of property and equipment on the straight-line method over their estimated useful lives. We charge the costs of repair and maintenance of property and equipment to operations as incurred, while we capitalize the costs of improvements that extend asset lives or functionality. Upon the disposition of property and equipment, the related cost and accumulated depreciation accounts are relieved and any resulting gain or loss is included as an adjustment to cost of services and products. | |
We capitalize interest on assets where the construction period is anticipated to be more than three months. We capitalized $0.1 million of interest in the three-month period ended March 31, 2014 and no interest in 2013. We do not allocate general administrative costs to capital projects. | |
Business Acquisitions. We account for business combinations using the acquisition method of accounting, and we allocate the acquisition price to the assets acquired and liabilities assumed based on their fair market values at the date of acquisition. | |
Goodwill and Intangible Assets. In our annual evaluation of goodwill for impairment, we first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, we determine it is more likely than not that the fair value of a reporting unit is not less than its carrying amount, performing the two-step impairment test is unnecessary. However, if we conclude otherwise, then we are required to perform the first step of the two-step impairment test. We tested the goodwill attributable to each of our reporting units for impairment as of December 31, 2013 and concluded that there was no impairment. | |
Intangible assets, primarily acquired in connection with business combinations, include trade names, intellectual property and customer relationships and are being amortized over their estimated useful lives. | |
Foreign Currency Translation. The functional currency for several of our foreign subsidiaries is the applicable local currency. Results of operations for foreign subsidiaries with functional currencies other than the U.S. dollar are translated into U.S. dollars using average exchange rates during the period. Assets and liabilities of these foreign subsidiaries are translated into U.S. dollars using the exchange rates in effect at the balance sheet date, and the resulting translation adjustments are recognized in accumulated other comprehensive income as a component of shareholders' equity. All foreign currency transaction gains and losses are recognized currently in the Consolidated Statements of Income. |
Inventory
Inventory | 3 Months Ended | |||||||||
Mar. 31, 2014 | ||||||||||
Inventory Disclosure [Abstract] | ' | |||||||||
Inventory | ' | |||||||||
INVENTORY | ||||||||||
The following is information regarding our inventory: | ||||||||||
(in thousands) | Mar 31, 2014 | Dec 31, 2013 | ||||||||
Inventory: | ||||||||||
Remotely operated vehicle parts and components | $ | 196,411 | $ | 190,403 | ||||||
Other, primarily raw materials | 241,462 | 251,386 | ||||||||
Total | $ | 437,873 | $ | 441,789 | ||||||
Debt
Debt | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Debt | ' | ||||||||
DEBT | |||||||||
Long-term Debt consisted of the following: | |||||||||
(in thousands) | Mar 31, 2014 | Dec 31, 2013 | |||||||
Revolving credit facility | $ | 90,000 | $ | — | |||||
Long-term Debt | $ | 90,000 | $ | — | |||||
We have a credit agreement with a group of banks (the "Credit Agreement"). The Credit Agreement provides for a five-year, $300 million revolving credit facility, and is scheduled to expire on January 6, 2017. Subject to certain conditions, the aggregate commitments under the facility may be increased by up to $200 million by obtaining additional commitments from existing and/or new lenders. Borrowings under the facility may be used for working capital and general corporate purposes. We pay commitment fees, which are included as interest expense on our consolidated financial statements, on the unused portion of the facility. Revolving borrowings under the facility bear interest at an adjusted base rate or the Eurodollar Rate (as defined in the agreement), at our option, plus an applicable margin. Depending on our debt to capitalization ratio, the applicable margin varies: (1) in the case of adjusted base rate advances, from 0.125% to 0.750%; and (2) in the case of eurodollar advances, from 1.125% to 1.750%. The adjusted base rate is the greater of (1) the per annum rate established by the administrative agent as its prime rate, (2) the federal funds rate plus 0.50% and (3) the one-month Eurodollar Rate plus 1%. | |||||||||
The Credit Agreement contains various covenants that we believe are customary for agreements of this nature, including, but not limited to, restrictions on the ability of each of our restricted subsidiaries to incur unsecured debt, as well as restrictions on our ability and the ability of each of our restricted subsidiaries to incur secured debt, grant liens, make certain investments, make distributions, merge or consolidate, sell assets, enter into transactions with affiliates and enter into certain restrictive agreements. We are also subject to an interest coverage ratio and a debt to capitalization ratio. The Credit Agreement includes customary events and consequences of default. |
Commitments_And_Contingencies
Commitments And Contingencies | 3 Months Ended |
Mar. 31, 2014 | |
Commitments and Contingencies Disclosure [Abstract] | ' |
Commitments And Contingencies | ' |
COMMITMENTS AND CONTINGENCIES | |
Litigation. Various actions and claims are pending against us, most of which are covered by insurance. Although we cannot predict the ultimate outcome of these matters, we believe the ultimate liability, if any, that may result from these actions and claims will not materially affect our results of operations, cash flow or financial position. | |
Financial Instruments and Risk Concentration. In the normal course of business, we manage risks associated with foreign exchange rates and interest rates through a variety of strategies, including the use of hedging transactions. As a matter of policy, we do not use derivative instruments unless we have an underlying exposure. Other financial instruments that potentially subject us to concentrations of credit risk are principally cash and cash equivalents and accounts receivable. | |
The carrying values of cash and cash equivalents approximate their fair values due to the short-term maturity of those instruments. Accounts receivable are generated from a broad group of customers, primarily from within the energy industry, which is our major source of revenue. Due to their short-term nature, carrying values of our accounts receivable and accounts payable approximate fair market values. We had borrowings of $90 million at March 31, 2014 under the Credit Agreement. Due to the short-term nature of the associated interest rate periods, the carrying value of our debt under the Credit Agreement approximates its fair value. Our debt is classified as Level 2 in the fair value hierarchy under U.S. GAAP (inputs other than quoted prices in active markets for similar assets and liabilities that are observable or can be corroborated by observable market data for substantially the full term for the assets or liabilities). | |
In the fourth quarter of 2013, we began to experience delays in payment from OGX Petróleo e Gás S.A. ("OGX"), a customer in Brazil. The parent company of OGX missed making an interest payment on its bonds and, on October 30, 2013, OGX and its parent filed for a restructuring process under Brazilian law, which grants the filer judicial protection from creditors while a restructuring plan is developed for approval. As of March 31, 2014, we had accounts receivable due from OGX of approximately $3.8 million related to operations prior to the restructuring filing. This amount had not been paid by April 30, 2014, and we have set up an allowance for doubtful accounts for the entire amount, primarily in the fourth quarter of 2013. At this time, we cannot predict the ultimate outcome of this situation and whether or to what extent we will collect our accounts receivable from OGX. |
Earnings_Per_Share_StockBased_
Earnings Per Share, Stock-Based Compensation and Share Repurchase Plan | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Shareholders' Equity, Earnings Per Share And Stock-Based Compensation [Abstract] | ' | ||||||
Shareholders' Equity, Earnings Per Share And Stock-Based Compensation | ' | ||||||
Earnings Per Share. The table that follows presents our computation of weighted average basic and diluted shares outstanding, which we use in our earnings per share calculations. For each period presented, our net income allocable to both common shareholders and diluted common shareholders is the same as our net income in our consolidated statements of income. | |||||||
Three Months Ended March 31, | |||||||
(in thousands) | 2014 | 2013 | |||||
Basic shares outstanding | 108,170 | 108,037 | |||||
Effect of restricted stock units | 554 | 575 | |||||
Diluted shares outstanding | 108,724 | 108,612 | |||||
We had been paying a quarterly cash dividend of $0.22 per share to our common shareholders since the second quarter of 2013. In April 2014, our Board of Directors increased our dividend to $0.27 per share, commencing with the dividend to be paid in June 2014. | |||||||
Share-Based Compensation. We have no outstanding stock options and no future share-based compensation to be recognized pursuant to stock option grants. | |||||||
We grant restricted units of our common stock to certain of our key executives, key employees and Chairman of the Board. We also grant shares of restricted stock to our other non-employee directors. The restricted units granted to our key executives and key employees generally vest in full on the third anniversary of the award date, conditional on continued employment. The restricted unit grants, including those granted to our Chairman, can vest pro rata over three years, provided the individual meets certain age and years-of-service requirements. The shares of restricted common stock we grant to our other non-employee directors vest in full on the first anniversary of the award date, conditional upon continued service as a director. Each grantee of shares of restricted stock is deemed to be the record owner of those shares during the restriction period, with the right to vote and receive any dividends on those shares. The restricted stock units outstanding have no voting or dividend rights. | |||||||
For each of the restricted stock units granted in 2012 through 2014, at the earlier of three years after grant or at termination of employment or service, the grantee will be issued a share of our common stock for each common stock unit vested. As of March 31, 2014 and December 31, 2013, totals of 854,704 and 960,290 shares of restricted stock or restricted stock units were outstanding. | |||||||
We estimate that stock-based compensation cost not yet recognized related to shares of restricted stock or restricted stock units, based on their grant-date fair values, was $30 million at March 31, 2014. This expense is being recognized on a staged-vesting basis over three years for awards attributable to individuals meeting certain age and years-of-service requirements, and on a straight-line basis over the applicable vesting period of one or three years for the other awards. | |||||||
Share Repurchase Plan. In February 2010, our Board of Directors approved a plan to repurchase up to 12 million shares of our common stock. Under this plan, we had repurchased 3.6 million shares of our common stock for $122 million through March 31, 2014. We repurchased 500,000 shares for $35 million during the three months ended March 31, 2014. We account for the shares we hold in treasury under the cost method, at average cost. |
Income_Taxes
Income Taxes | 3 Months Ended | ||
Mar. 31, 2014 | |||
Income Tax Disclosure [Abstract] | ' | ||
Income Taxes | ' | ||
INCOME TAXES | |||
During interim periods, we provide for income taxes based on our current estimated annual effective tax rate using assumptions as to (1) earnings and other factors that would affect the tax provision for the remainder of the year and (2) the operations of foreign branches and subsidiaries that are subject to local income and withholding taxes. We conduct business through several foreign subsidiaries and, although we expect our consolidated operations to be profitable, there is no assurance that profits will be earned in entities or jurisdictions that have net operating loss carryforwards available. The primary difference between our effective tax rates of 31.3% in the in the three-month period ended March 31, 2014 and 31.5% in the three-month period ended March 31, 2013 and the federal statutory rate of 35% reflects our intention to indefinitely reinvest in certain of our international operations. Therefore, we do not provide for U.S. taxes on that portion of our foreign earnings. | |||
We conduct our international operations in a number of locations that have varying laws and regulations with regard to income and other taxes, some of which are subject to interpretation. We recognize the benefit for a tax position if the benefit is more likely than not to be sustainable upon audit by the applicable taxing authority. If this threshold is met, the tax benefit is then measured and recognized at the largest amount that we believe is greater than 50% likely of being realized upon ultimate settlement. We do not believe that the total of unrecognized tax benefits will significantly increase or decrease in the next 12 months. | |||
We account for any applicable interest and penalties on uncertain tax positions as a component of our provision for income taxes on our financial statements. Including associated foreign tax credits and penalties and interest, we have accrued a net total of $7.0 million in the caption "other long-term liabilities" on our balance sheet for unrecognized tax benefits at March 31, 2014. All additions or reductions to those liabilities would affect our effective income tax rate in the periods of change. | |||
Our tax returns are subject to audit by taxing authorities in multiple jurisdictions. These audits often take years to complete and settle. The following lists the earliest tax years open to examination by tax authorities where we have significant operations: | |||
Jurisdiction | Periods | ||
United States | 2010 | ||
United Kingdom | 2010 | ||
Norway | 2003 | ||
Angola | 2009 | ||
Brazil | 2008 | ||
Australia | 2010 |
Business_Segment_Information
Business Segment Information | 3 Months Ended | ||||||||||||
Mar. 31, 2014 | |||||||||||||
Segment Reporting, Measurement Disclosures [Abstract] | ' | ||||||||||||
Business Segment Information | ' | ||||||||||||
BUSINESS SEGMENT INFORMATION | |||||||||||||
We are a global oilfield provider of engineered services and products, primarily to the offshore oil and gas industry, with a focus on deepwater applications. Through the use of our applied technology expertise, we also serve the defense, entertainment and aerospace industries. Our Oilfield business consists of Remotely Operated Vehicles ("ROVs"), Subsea Products, Subsea Projects and Asset Integrity. Our ROV segment provides submersible vehicles operated from the surface to support offshore oil and gas exploration, development and production activities. Our Subsea Products segment supplies a variety of hardware and related services. Our Subsea Projects segment provides multiservice subsea support vessels and oilfield diving and support vessel operations, primarily for inspection, maintenance and repair and installation activities. We also operate and maintain offshore and onshore oil and gas production facilities, provide subsea engineering services, and operate an offshore logistics supply base in Australia. Our Asset Integrity segment provides asset integrity management and assessment services and nondestructive testing and inspection. Our Advanced Technologies business provides project management, engineering services and equipment for applications in non-oilfield markets. Unallocated Expenses are those not associated with a specific business segment. These consist of expenses related to our incentive and deferred compensation plans, including restricted stock and bonuses, as well as other general expenses, including corporate administrative expenses. | |||||||||||||
There are no differences in the basis of segmentation or in the basis of measurement of segment profit or loss from those used in our consolidated financial statements for the year ended December 31, 2013. | |||||||||||||
The table that follows presents Revenue and Income from Operations by business segment for each of the periods indicated. | |||||||||||||
Three Months Ended | |||||||||||||
(in thousands) | Mar 31, 2014 | Mar 31, 2013 | Dec 31, 2013 | ||||||||||
Revenue | |||||||||||||
Oilfield | |||||||||||||
Remotely Operated Vehicles | $ | 255,819 | $ | 229,628 | $ | 254,958 | |||||||
Subsea Products | 260,010 | 214,005 | 292,100 | ||||||||||
Subsea Projects | 138,190 | 88,455 | 159,658 | ||||||||||
Asset Integrity | 124,159 | 114,849 | 123,673 | ||||||||||
Total Oilfield | 778,178 | 646,937 | 830,389 | ||||||||||
Advanced Technologies | 62,023 | 71,615 | 64,409 | ||||||||||
Total | $ | 840,201 | $ | 718,552 | $ | 894,798 | |||||||
Income from Operations | |||||||||||||
Oilfield | |||||||||||||
Remotely Operated Vehicles | $ | 76,740 | $ | 65,835 | $ | 72,209 | |||||||
Subsea Products | 54,516 | 42,779 | 64,474 | ||||||||||
Subsea Projects | 20,537 | 11,620 | 27,555 | ||||||||||
Asset Integrity | 14,085 | 12,339 | 9,892 | ||||||||||
Total Oilfield | 165,878 | 132,573 | 174,130 | ||||||||||
Advanced Technologies | 2,955 | 8,676 | (287 | ) | |||||||||
Unallocated Expenses | (35,971 | ) | (32,959 | ) | (37,090 | ) | |||||||
Total | $ | 132,862 | $ | 108,290 | $ | 136,753 | |||||||
We determine income from operations for each business segment before interest income or expense, other income (expense) and provision for income taxes. We do not consider an allocation of these items to be practical. Our equity earnings of unconsolidated affiliates is part of our Subsea Projects segment. |
Summary_Of_Major_Accounting_Po1
Summary Of Major Accounting Policies (Policy) | 3 Months Ended |
Mar. 31, 2014 | |
Accounting Policies [Abstract] | ' |
Basis of Presentation | ' |
Basis of Presentation. We have prepared these unaudited consolidated financial statements pursuant to instructions for quarterly reports on Form 10-Q, which we are required to file with the U.S. Securities and Exchange Commission. These financial statements do not include all information and footnotes normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States ("U.S. GAAP"). These financial statements reflect all adjustments that we believe are necessary to present fairly our financial position at March 31, 2014 and our results of operations and cash flows for the periods presented. Except as otherwise disclosed herein, all such adjustments are of a normal and recurring nature. These financial statements should be read in conjunction with the consolidated financial statements and related notes included in our annual report on Form 10-K for the year ended December 31, 2013. The results for interim periods are not necessarily indicative of annual results. | |
Principles of Consolidation | ' |
Principles of Consolidation. The consolidated financial statements include the accounts of Oceaneering International, Inc. and our 50% or more owned and controlled subsidiaries. We also consolidate entities that are determined to be variable interest entities if we determine that we are the primary beneficiary; otherwise, we account for those entities using the equity method of accounting. We use the equity method to account for our investments in unconsolidated affiliated companies of which we own an equity interest of between 20% and 50% and as to which we have significant influence, but not control, over operations. All significant intercompany accounts and transactions have been eliminated. | |
Use Of Estimates | ' |
Use of Estimates. The preparation of financial statements in conformity with U.S. GAAP requires that our management make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expense during the reporting period. Actual results could differ from those estimates. | |
Cash and Cash Equivalents | ' |
Cash and Cash Equivalents. Cash and cash equivalents include demand deposits and highly liquid investments with original maturities of three months or less from the date of the investment. | |
Accounts Receivable | ' |
Accounts Receivable – Allowances for Doubtful Accounts. We determine the need for allowances for doubtful accounts using the specific identification method. We do not generally require collateral from our customers. | |
Inventory | ' |
Inventory. Inventory is valued at lower of cost or market. We determine cost using the weighted-average method. | |
Property and Equipment | ' |
Property and Equipment. We provide for depreciation of property and equipment on the straight-line method over their estimated useful lives. We charge the costs of repair and maintenance of property and equipment to operations as incurred, while we capitalize the costs of improvements that extend asset lives or functionality. Upon the disposition of property and equipment, the related cost and accumulated depreciation accounts are relieved and any resulting gain or loss is included as an adjustment to cost of services and products. | |
We capitalize interest on assets where the construction period is anticipated to be more than three months. We capitalized $0.1 million of interest in the three-month period ended March 31, 2014 and no interest in 2013. We do not allocate general administrative costs to capital projects. | |
Business Acquisitions | ' |
Business Acquisitions. We account for business combinations using the acquisition method of accounting, and we allocate the acquisition price to the assets acquired and liabilities assumed based on their fair market values at the date of acquisition. | |
Goodwill and Intangible Assets | ' |
Goodwill and Intangible Assets. In our annual evaluation of goodwill for impairment, we first assess qualitative factors to determine whether the existence of events or circumstances leads to a determination that it is more likely than not that the fair value of a reporting unit is less than its carrying amount. If, after assessing the totality of events or circumstances, we determine it is more likely than not that the fair value of a reporting unit is not less than its carrying amount, performing the two-step impairment test is unnecessary. However, if we conclude otherwise, then we are required to perform the first step of the two-step impairment test. We tested the goodwill attributable to each of our reporting units for impairment as of December 31, 2013 and concluded that there was no impairment. | |
Intangible assets, primarily acquired in connection with business combinations, include trade names, intellectual property and customer relationships and are being amortized over their estimated useful lives. |
Inventory_Tables
Inventory (Tables) | 3 Months Ended | |||||||||
Mar. 31, 2014 | ||||||||||
Inventory Disclosure [Abstract] | ' | |||||||||
Inventory [Table Text Block] | ' | |||||||||
(in thousands) | Mar 31, 2014 | Dec 31, 2013 | ||||||||
Inventory: | ||||||||||
Remotely operated vehicle parts and components | $ | 196,411 | $ | 190,403 | ||||||
Other, primarily raw materials | 241,462 | 251,386 | ||||||||
Total | $ | 437,873 | $ | 441,789 | ||||||
Debt_Tables
Debt (Tables) | 3 Months Ended | ||||||||
Mar. 31, 2014 | |||||||||
Debt Disclosure [Abstract] | ' | ||||||||
Schedule of Debt | ' | ||||||||
Long-term Debt consisted of the following: | |||||||||
(in thousands) | Mar 31, 2014 | Dec 31, 2013 | |||||||
Revolving credit facility | $ | 90,000 | $ | — | |||||
Long-term Debt | $ | 90,000 | $ | — | |||||
Earnings_Per_Share_StockBased_1
Earnings Per Share, Stock-Based Compensation and Share Repurchase Plan (Tables) | 3 Months Ended | ||||||
Mar. 31, 2014 | |||||||
Shareholders' Equity, Earnings Per Share And Stock-Based Compensation [Abstract] | ' | ||||||
Schedule of Earnings Per Share | ' | ||||||
Earnings Per Share. The table that follows presents our computation of weighted average basic and diluted shares outstanding, which we use in our earnings per share calculations. For each period presented, our net income allocable to both common shareholders and diluted common shareholders is the same as our net income in our consolidated statements of income. | |||||||
Three Months Ended March 31, | |||||||
(in thousands) | 2014 | 2013 | |||||
Basic shares outstanding | 108,170 | 108,037 | |||||
Effect of restricted stock units | 554 | 575 | |||||
Diluted shares outstanding | 108,724 | 108,612 | |||||
Income_Taxes_Tables
Income Taxes (Tables) | 3 Months Ended | ||
Mar. 31, 2014 | |||
Income Tax Disclosure [Abstract] | ' | ||
Summary of Income Tax Examinations | ' | ||
The following lists the earliest tax years open to examination by tax authorities where we have significant operations: | |||
Jurisdiction | Periods | ||
United States | 2010 | ||
United Kingdom | 2010 | ||
Norway | 2003 | ||
Angola | 2009 | ||
Brazil | 2008 | ||
Australia | 2010 |
Business_Segment_Information_T
Business Segment Information (Tables) | 3 Months Ended | ||||||||||||
Mar. 31, 2014 | |||||||||||||
Segment Reporting, Measurement Disclosures [Abstract] | ' | ||||||||||||
Financial Data By Business Segment | ' | ||||||||||||
The table that follows presents Revenue and Income from Operations by business segment for each of the periods indicated. | |||||||||||||
Three Months Ended | |||||||||||||
(in thousands) | Mar 31, 2014 | Mar 31, 2013 | Dec 31, 2013 | ||||||||||
Revenue | |||||||||||||
Oilfield | |||||||||||||
Remotely Operated Vehicles | $ | 255,819 | $ | 229,628 | $ | 254,958 | |||||||
Subsea Products | 260,010 | 214,005 | 292,100 | ||||||||||
Subsea Projects | 138,190 | 88,455 | 159,658 | ||||||||||
Asset Integrity | 124,159 | 114,849 | 123,673 | ||||||||||
Total Oilfield | 778,178 | 646,937 | 830,389 | ||||||||||
Advanced Technologies | 62,023 | 71,615 | 64,409 | ||||||||||
Total | $ | 840,201 | $ | 718,552 | $ | 894,798 | |||||||
Income from Operations | |||||||||||||
Oilfield | |||||||||||||
Remotely Operated Vehicles | $ | 76,740 | $ | 65,835 | $ | 72,209 | |||||||
Subsea Products | 54,516 | 42,779 | 64,474 | ||||||||||
Subsea Projects | 20,537 | 11,620 | 27,555 | ||||||||||
Asset Integrity | 14,085 | 12,339 | 9,892 | ||||||||||
Total Oilfield | 165,878 | 132,573 | 174,130 | ||||||||||
Advanced Technologies | 2,955 | 8,676 | (287 | ) | |||||||||
Unallocated Expenses | (35,971 | ) | (32,959 | ) | (37,090 | ) | |||||||
Total | $ | 132,862 | $ | 108,290 | $ | 136,753 | |||||||
Summary_Of_Major_Accounting_Po2
Summary Of Major Accounting Policies - Principles of Consolidation And Repurchases (Details) | Mar. 31, 2014 |
Minimum [Member] | ' |
Schedule of Equity Method Investments [Line Items] | ' |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Percentage | 50.00% |
Equity Method Investment, Ownership Interest Threshold For Consolidation, Percentage | 20.00% |
Maximum [Member] | ' |
Schedule of Equity Method Investments [Line Items] | ' |
Equity Method Investment, Ownership Interest Threshold For Consolidation, Percentage | 50.00% |
Summary_Of_Major_Accounting_Po3
Summary Of Major Accounting Policies - Property, Plant and Equipment (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Accounting Policies [Abstract] | ' | ' |
Interest Costs, Capitalized, Minimum Construction Period | '3 months | '3 months |
Interest Costs, Capitalized During Period | $61 | $0 |
Inventory_Details
Inventory (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Inventory Disclosure [Abstract] | ' | ' |
Inventory for remotely operated vehicles | $196,411 | $190,403 |
Other inventory, primarily raw materials | 241,462 | 251,386 |
Total | $437,873 | $441,789 |
Debt_LongTerm_Debt_Details
Debt - Long-Term Debt (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 |
In Thousands, unless otherwise specified | ||
Debt Disclosure [Abstract] | ' | ' |
Revolving credit facility | $90,000 | $0 |
Long-term Debt | $90,000 | $0 |
Debt_Line_of_Credit_Details
Debt - Line of Credit (Details) (Credit Agreement 2012 [Member], USD $) | Jan. 06, 2012 |
In Millions, unless otherwise specified | |
Line of Credit Facility [Line Items] | ' |
Line of Credit Facility, Maximum Borrowing Capacity | $300 |
Line of Credit Facility, Available Additional Borrowing Capacity | $200 |
Adjusted Base Rate Advances [Member] | Adjusted Base Rate [Member] | Federal Funds Rate [Member] | Minimum [Member] | ' |
Line of Credit Facility [Line Items] | ' |
Line of Credit Facility, Basis Spread on Variable Rate | 0.50% |
Adjusted Base Rate Advances [Member] | Adjusted Base Rate [Member] | Eurodollar Rate [Member] | Minimum [Member] | ' |
Line of Credit Facility [Line Items] | ' |
Line of Credit Facility, Basis Spread on Variable Rate | 1.00% |
Adjusted Base Rate Advances [Member] | Applicable Margin [Member] | Minimum [Member] | ' |
Line of Credit Facility [Line Items] | ' |
Line of Credit Facility, Basis Spread on Variable Rate | 0.13% |
Adjusted Base Rate Advances [Member] | Applicable Margin [Member] | Maximum [Member] | ' |
Line of Credit Facility [Line Items] | ' |
Line of Credit Facility, Basis Spread on Variable Rate | 0.75% |
Eurodollar Advances [Member] | Applicable Margin [Member] | Minimum [Member] | ' |
Line of Credit Facility [Line Items] | ' |
Line of Credit Facility, Basis Spread on Variable Rate | 1.13% |
Eurodollar Advances [Member] | Applicable Margin [Member] | Maximum [Member] | ' |
Line of Credit Facility [Line Items] | ' |
Line of Credit Facility, Basis Spread on Variable Rate | 1.75% |
Commitments_And_Contingencies_
Commitments And Contingencies - Narrative (Details) (USD $) | Mar. 31, 2014 | Dec. 31, 2013 | Apr. 30, 2014 |
Brazil [Member] | |||
Collectibility of Receivables [Member] | |||
Loss Contingencies [Line Items] | ' | ' | ' |
Accounts Receivable, Gross, Current | ' | ' | $3,800,000 |
Long-term Debt, Excluding Current Maturities | 90,000,000 | 0 | ' |
Line of Credit Facility, Amount Outstanding | $90,000,000 | $0 | ' |
Earnings_Per_Share_StockBased_2
Earnings Per Share, Stock-Based Compensation and Share Repurchase Plan (Narrative) (Details) (USD $) | 3 Months Ended | |||||
In Millions, except Share data, unless otherwise specified | Jun. 30, 2014 | Mar. 31, 2014 | Sep. 30, 2013 | Jun. 30, 2013 | Mar. 31, 2013 | Feb. 28, 2010 |
Shareholders' Equity, Earnings Per Share And Stock-Based Compensation [Line Items] | ' | ' | ' | ' | ' | ' |
Cash dividend per share | $0.27 | $0.22 | $0.22 | $0.22 | ' | ' |
Common Stock, Dividends, Per Share, Declared | ' | $0.22 | ' | ' | $0.18 | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number | ' | 854,704 | ' | ' | ' | ' |
Stock Repurchase Program, Number of Shares Authorized to be Repurchased | ' | ' | ' | ' | ' | 12,000,000 |
Stock Repurchase Program, Total Number of Shares Repurchased To Date | ' | 3,600,000 | ' | ' | ' | ' |
Stock Repurchase Program, Total Shares Repurchased To Date, Amount | ' | $122 | ' | ' | ' | ' |
Stock Repurchased During Period, Shares | ' | 500,000 | ' | ' | ' | ' |
Stock Repurchased During Period, Value | ' | 35.3 | ' | ' | ' | ' |
Restricted Stock Units (RSUs) [Member] | ' | ' | ' | ' | ' | ' |
Shareholders' Equity, Earnings Per Share And Stock-Based Compensation [Line Items] | ' | ' | ' | ' | ' | ' |
Employee Service Share-based Compensation, Nonvested Awards, Total Compensation Cost Not yet Recognized, Share-based Awards Other than Options | ' | $30 | ' | ' | ' | ' |
Restricted Stock Units (RSUs) [Member] | Minimum [Member] | ' | ' | ' | ' | ' | ' |
Shareholders' Equity, Earnings Per Share And Stock-Based Compensation [Line Items] | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | ' | '1 year | ' | ' | ' | ' |
Restricted Stock Units (RSUs) [Member] | Maximum [Member] | ' | ' | ' | ' | ' | ' |
Shareholders' Equity, Earnings Per Share And Stock-Based Compensation [Line Items] | ' | ' | ' | ' | ' | ' |
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | ' | '3 years | ' | ' | ' | ' |
Earnings_Per_Share_StockBased_3
Earnings Per Share, Stock-Based Compensation and Share Repurchase Plan (Earnings Per Share) (Details) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Shareholders' Equity, Earnings Per Share And Stock-Based Compensation [Abstract] | ' | ' |
Basic shares outstanding | 108,170 | 108,037 |
Effect of restricted stock units | 554 | 575 |
Diluted shares outstanding | 108,724 | 108,612 |
Income_Taxes_Narrative_Details
Income Taxes - Narrative (Details) (USD $) | 3 Months Ended | |
Mar. 31, 2014 | Mar. 31, 2013 | |
Operating Loss Carryforwards [Line Items] | ' | ' |
Cost of Goods and Services Sold | $650,710,000 | $558,177,000 |
Effective income tax rate continuing operations | 31.30% | 31.50% |
Federal statutory tax rate | 35.00% | ' |
Unrecognized Tax Benefits, Probability Threshold of Realizing for Tax Benefits Recognition, Minimum Percentage | 50.00% | ' |
Unrecognized Tax Benefits, Including Foreign Tax Credits and Penalties and Interest | $7,000,000 | ' |
Income_Taxes_Summary_Of_Earlie
Income Taxes - Summary Of Earliest Tax Years Open To Examination (Details) | 3 Months Ended |
Mar. 31, 2014 | |
United States [Member] | ' |
Income Tax Examination [Line Items] | ' |
Earliest tax years open to examination by tax authorities | '2010 |
United Kingdom [Member] | ' |
Income Tax Examination [Line Items] | ' |
Earliest tax years open to examination by tax authorities | '2010 |
Norway [Member] | ' |
Income Tax Examination [Line Items] | ' |
Earliest tax years open to examination by tax authorities | '2003 |
Angola [Member] | ' |
Income Tax Examination [Line Items] | ' |
Earliest tax years open to examination by tax authorities | '2009 |
Brazil [Member] | ' |
Income Tax Examination [Line Items] | ' |
Earliest tax years open to examination by tax authorities | '2008 |
Australia [Member] | ' |
Income Tax Examination [Line Items] | ' |
Earliest tax years open to examination by tax authorities | '2010 |
Business_Segment_Information_N
Business Segment Information - Narrative (Details) (USD $) | 3 Months Ended | |
In Thousands, unless otherwise specified | Mar. 31, 2014 | Mar. 31, 2013 |
Segment Reporting Information [Line Items] | ' | ' |
Cost of Goods and Services Sold | $650,710 | $558,177 |
Business_Segment_Information_F
Business Segment Information - Financial Data By Business Segment (Details) (USD $) | 3 Months Ended | ||
In Thousands, unless otherwise specified | Mar. 31, 2014 | Dec. 31, 2013 | Mar. 31, 2013 |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenue | $840,201 | $894,798 | $718,552 |
Income from Operations | 132,862 | 136,753 | 108,290 |
Oil And Gas [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenue | 778,178 | 830,389 | 646,937 |
Income from Operations | 165,878 | 174,130 | 132,573 |
ROVs [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenue | 255,819 | 254,958 | 229,628 |
Income from Operations | 76,740 | 72,209 | 65,835 |
Subsea Products [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenue | 260,010 | 292,100 | 214,005 |
Income from Operations | 54,516 | 64,474 | 42,779 |
Subsea Projects [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenue | 138,190 | 159,658 | 88,455 |
Income from Operations | 20,537 | 27,555 | 11,620 |
Asset Integrity [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenue | 124,159 | 123,673 | 114,849 |
Income from Operations | 14,085 | 9,892 | 12,339 |
Advanced Technologies [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Revenue | 62,023 | 64,409 | 71,615 |
Income from Operations | 2,955 | -287 | 8,676 |
Unallocated Expenses [Member] | ' | ' | ' |
Segment Reporting Information [Line Items] | ' | ' | ' |
Income from Operations | ($35,971) | ($37,090) | ($32,959) |