Exhibit 99.1
Contact: John E. Vollmer III
Chief Financial Officer
Patterson-UTI Energy, Inc.
(281) 765-7100
Patterson-UTI Energy Reports Financial Results for
Three and Six Months Ended June 30, 2009
HOUSTON, July 30, 2009— Patterson-UTI Energy, Inc.(Nasdaq: PTEN) today reported financial results for the three and six months ended June 30, 2009. The Company reported a net loss for the second quarter of 2009 of $17.7 million, or $0.12 per share, compared to net income of $81.4 million, or $0.52 per share, for the second quarter of 2008. Revenues for the quarter ended June 30, 2009 were $161 million, compared to $526 million for the quarter ended June 30, 2008.
The Company reported a net loss of $1.5 million, or $0.01 per share, for the six months ended June 30, 2009, compared to net income of $159 million, or $1.01 per share, for the six months ended June 30, 2008. Revenues for the first six months of 2009 were $457 million, compared to $1.0 billion for the first six months of 2008.
Douglas J. Wall, Patterson-UTI’s Chief Executive Officer, stated, “The continuing weakness in natural gas prices has resulted in low levels of drilling activity, which is reflected in our financial and operating results for the second quarter of 2009. We had an average of 63 rigs operating in the second quarter ended June 30, 2009, comprised of 61 in the United States and 2 in Canada, compared to an average of 127 rigs operating in the first quarter of 2009, including 116 in the United States and 11 in Canada. Due to a recent increase in spot-rate rig activity, we currently have 68 rigs operating, including 66 in the United States and 2 in Canada.”
Mr. Wall added, “Average revenue per operating day for the three months ended June 30, 2009 was $17,780, compared to average revenue per operating day of $19,670 for the three months ended March 31, 2009. Average direct operating costs per operating day for the second quarter of 2009 were $9,960 compared to $11,010 for the three months ended March 31, 2009. As a result, average margin per operating day in the second quarter of 2009 was $7,820, compared to $8,660 for the first quarter of 2009.
“Our average rig count in the second quarter included 7 rigs that earned standby revenues of $7.5 million. Rigs on standby earn a discounted dayrate as they do not have crews and have lower costs. Accordingly, these standby rigs reduced both average revenue and direct operating costs per operating day during the second quarter. Average revenues per operating day were also impacted by delays in the delivery of some of our newbuild rigs.
“During the second quarter of 2009 we had an average of approximately 32 rigs operating under term contracts (including 7 rigs earning standby revenues). We expect to have an average of approximately 29 rigs (including 3 rigs earning standby revenues) under term contracts for the remainder of the year. We expect to have an average of approximately 28 rigs in 2010 and 21 rigs in 2011 under existing long-term contracts.
“We have activated eleven new Apex™ rigs so far this year. We currently have multi-year contracts for ten additional new advanced technology Apex™ rigs,” he concluded.
Mark S. Siegel, Chairman of Patterson-UTI stated, “As we have said, the severe downturn in our industry affected all of our regions and all sizes of rigs. We have reduced costs and streamlined operations so as to align our business units with current market conditions.
“We have recently experienced an increase in demand for our rigs under spot rate contracts. Accordingly, our rig count has increased in July, but our average revenues per operating day are being reduced since these spot rate contracts have lower dayrates than our long-term contracts.”
Mr. Siegel added, “We have been through these cycles before and believe that we are well-positioned for the opportunities that may arise during this period. Our balance sheet at June 30, 2009 remains strong with $168 million in cash and no debt.”
The Company declared a quarterly cash dividend on its common stock of $0.05 per share, to be paid on September 30, 2009 to holders of record as of September 15, 2009.
All references to “net income per share” in this press release are diluted earnings per common share as defined within Statement of Financial Accounting Standards No. 128.
The Company’s quarterly conference call to discuss the operating results for the three and six-month periods ended June 30, 2009 is scheduled for July 30, 2009 at 10:00 a.m. (EDT) / 9:00 a.m. (CDT) / 7:00 a.m. (PDT). The dial-in information for participants is 800-573-4840 (Domestic) and 617-224-4326 (International). The Passcode for both numbers is 46742116. The call is also being webcast and can be accessed through the Investor Relations section atwww.patenergy.com. Webcast participants should log on 10-15 minutes prior to the scheduled start time. Replay of the conference call will be available through August 3, 2009 atwww.patenergy.com and at 888-286-8010 (Domestic) and 617-801-6888 (International). The Passcode for both numbers is 20896768.
About Patterson-UTI
Patterson-UTI Energy, Inc. provides onshore contract drilling services to exploration and production companies in North America. The Company has approximately 350 marketable land-based drilling rigs that operate primarily in the oil and natural gas producing regions of Texas, New Mexico, Oklahoma, Arkansas, Louisiana, Mississippi, Alabama, Colorado, Arizona, Utah, Wyoming, Montana, North Dakota, South Dakota, Pennsylvania, West Virginia and western Canada. Patterson-UTI Energy, Inc. is also engaged in the businesses of pressure pumping services and drilling and completion fluid services.
Statements made in this press release which state the Company’s or management’s intentions, beliefs, expectations or predictions for the future are forward-looking statements. It is important to note that actual results could differ materially from those discussed in such forward-looking statements. Important factors that could cause actual results to differ materially include, but are not limited to, deterioration in the global economic environment, declines in oil and natural gas prices that could adversely affect demand for the Company’s services, and their associated effect on day rates, rig utilization and planned capital expenditures, excess availability of land drilling rigs, including as a result of the reactivation or construction of new land drilling rigs, adverse industry conditions, difficulty in integrating acquisitions, demand for oil and natural gas, shortages of rig equipment and ability to retain management and field personnel. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company’s SEC filings, which may be obtained by contacting the Company or the SEC. These filings are also available through the Company’s web site athttp://www.patenergy.com or through the SEC’s Electronic Data Gathering and Analysis Retrieval System (EDGAR) athttp://www.sec.gov. We undertake no obligation to publicly update or revise any forward-looking statement.
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PATTERSON-UTI ENERGY, INC.
Condensed Consolidated Statements of Income (Unaudited)
(in thousands, except per share amounts)
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
REVENUES | $ | 160,764 | $ | 526,283 | $ | 456,803 | $ | 1,030,837 | ||||||||
COSTS AND EXPENSES | ||||||||||||||||
Direct operating costs (excluding depreciation, depletion and impairment) | 100,637 | 318,865 | 280,462 | 622,337 | ||||||||||||
Depreciation, depletion and impairment | 68,857 | 65,673 | 139,204 | 129,399 | ||||||||||||
Selling, general and administrative | 16,236 | 17,747 | 32,220 | 34,743 | ||||||||||||
Net loss (gain) on asset disposals/retirements | 176 | (2,721 | ) | 350 | (2,535 | ) | ||||||||||
Other operating expenses | 2,000 | 300 | 6,000 | 600 | ||||||||||||
Total costs and expenses | 187,906 | 399,864 | 458,236 | 784,544 | ||||||||||||
OPERATING INCOME (LOSS) | (27,142 | ) | 126,419 | (1,433 | ) | 246,293 | ||||||||||
OTHER INCOME (EXPENSE) | ||||||||||||||||
Interest expense | (839 | ) | (63 | ) | (1,286 | ) | (340 | ) | ||||||||
Interest income | 204 | 493 | 265 | 836 | ||||||||||||
Other | 12 | 353 | 35 | 737 | ||||||||||||
Total other income (expense) | (623 | ) | 783 | (986 | ) | 1,233 | ||||||||||
INCOME (LOSS) BEFORE INCOME TAXES | (27,765 | ) | 127,202 | (2,419 | ) | 247,526 | ||||||||||
INCOME TAX EXPENSE (BENEFIT) | (10,022 | ) | 45,780 | (879 | ) | 88,695 | ||||||||||
NET INCOME (LOSS) | $ | (17,743 | ) | $ | 81,422 | $ | (1,540 | ) | $ | 158,831 | ||||||
NET INCOME (LOSS) PER COMMON SHARE | ||||||||||||||||
Basic | $ | (0.12 | ) | $ | 0.52 | $ | (0.01 | ) | $ | 1.03 | ||||||
Diluted | $ | (0.12 | ) | $ | 0.52 | $ | (0.01 | ) | $ | 1.01 | ||||||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING | ||||||||||||||||
Basic | 151,941 | 153,978 | 151,839 | 153,289 | ||||||||||||
Diluted | 151,941 | 155,894 | 151,839 | 155,410 | ||||||||||||
CASH DIVIDENDS PER COMMON SHARE | $ | 0.05 | $ | 0.16 | $ | 0.10 | $ | 0.28 | ||||||||
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PATTERSON-UTI ENERGY, INC.
Additional Financial and Operating Data (Unaudited)
(dollars in thousands)
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2009 | 2008 | 2009 | 2008 | |||||||||||||
Contract Drilling: | ||||||||||||||||
Revenues | $ | 101,716 | $ | 416,835 | $ | 327,420 | $ | 836,984 | ||||||||
Direct operating costs (excluding depreciation) | $ | 56,950 | $ | 251,381 | $ | 183,271 | $ | 495,748 | ||||||||
Selling, general and administrative | $ | 1,096 | $ | 1,297 | $ | 2,082 | $ | 2,821 | ||||||||
Depreciation | $ | 58,555 | $ | 57,362 | $ | 115,941 | $ | 113,234 | ||||||||
Operating income (loss) | $ | (14,885 | ) | $ | 106,795 | $ | 26,126 | $ | 225,181 | |||||||
Operating days | 5,720 | 22,245 | 17,193 | 44,478 | ||||||||||||
Average revenue per operating day | $ | 17.78 | $ | 18.74 | $ | 19.04 | $ | 18.82 | ||||||||
Average direct operating costs per operating day | $ | 9.96 | $ | 11.30 | $ | 10.66 | $ | 11.15 | ||||||||
Average rigs operating | 63 | 244 | 95 | 244 | ||||||||||||
Capital expenditures | $ | 148,447 | $ | 67,815 | $ | 215,449 | $ | 135,026 | ||||||||
Pressure Pumping: | ||||||||||||||||
Revenues | $ | 33,616 | $ | 57,094 | $ | 71,721 | $ | 99,958 | ||||||||
Direct operating costs (excluding depreciation) | $ | 22,862 | $ | 32,506 | $ | 49,868 | $ | 61,011 | ||||||||
Selling, general and administrative | $ | 4,964 | $ | 5,834 | $ | 10,799 | $ | 11,441 | ||||||||
Depreciation | $ | 6,688 | $ | 4,477 | $ | 12,827 | $ | 8,777 | ||||||||
Operating income (loss) | $ | (898 | ) | $ | 14,277 | $ | (1,773 | ) | $ | 18,729 | ||||||
Total jobs | 1,681 | 3,400 | 3,592 | 6,311 | ||||||||||||
Average revenue per job | $ | 20.00 | $ | 16.79 | $ | 19.97 | $ | 15,84 | ||||||||
Average costs per job | $ | 13.60 | $ | 9.56 | $ | 13.88 | $ | 9.67 | ||||||||
Capital expenditures | $ | 6,753 | $ | 17,689 | $ | 28,573 | $ | 30,648 | ||||||||
Drilling and Completion Fluids: | ||||||||||||||||
Revenues | $ | 20,267 | $ | 38,745 | $ | 48,097 | $ | 71,295 | ||||||||
Direct operating costs (excluding depreciation) | $ | 19,005 | $ | 31,449 | $ | 43,527 | $ | 59,982 | ||||||||
Selling, general and administrative | $ | 1,757 | $ | 2,517 | $ | 3,932 | $ | 5,143 | ||||||||
Depreciation | $ | 600 | $ | 724 | $ | 1,215 | $ | 1,448 | ||||||||
Operating income (loss) | $ | (1,095 | ) | $ | 4,055 | $ | (577 | ) | $ | 4,722 | ||||||
Capital expenditures | $ | — | $ | 1,525 | $ | 6 | $ | 1,533 | ||||||||
Oil and Natural Gas Production and Exploration: | ||||||||||||||||
Revenues | $ | 5,165 | $ | 13,609 | $ | 9,565 | $ | 22,600 | ||||||||
Direct operating costs (excluding depreciation, depletion and impairment) | $ | 1,820 | $ | 3,529 | $ | 3,796 | $ | 5,596 | ||||||||
Depreciation and depletion | $ | 2,187 | $ | 2,828 | $ | 5,677 | $ | 5,234 | ||||||||
Impairment of oil and natural gas properties | $ | 600 | $ | 79 | $ | 3,090 | $ | 300 | ||||||||
Operating income (loss) | $ | 558 | $ | 7,173 | $ | (2,998 | ) | $ | 11,470 | |||||||
Capital expenditures | $ | 1,551 | $ | 4,527 | $ | 2,521 | $ | 8,955 | ||||||||
Corporate and Other: | ||||||||||||||||
Selling, general and administrative | $ | 8,419 | $ | 8,099 | $ | 15,407 | $ | 15,338 | ||||||||
Depreciation | $ | 227 | $ | 203 | $ | 454 | $ | 406 | ||||||||
Other operating expenses | $ | 2,000 | $ | 300 | $ | 6,000 | $ | 600 | ||||||||
Net loss (gain) on asset disposals/retirements | $ | 176 | $ | (2,721 | ) | $ | 350 | $ | (2,535 | ) | ||||||
Total capital expenditures | $ | 156,751 | $ | 91,556 | $ | 246,549 | $ | 176,162 |
June 30, | December 31, | |||||||
2009 | 2008 | |||||||
Selected Balance Sheet Data (Unaudited): | ||||||||
Cash and cash equivalents | $ | 167,665 | $ | 81,223 | ||||
Current assets | $ | 449,785 | $ | 641,374 | ||||
Total assets | $ | 2,651,351 | $ | 2,712,817 | ||||
Current liabilities | $ | 219,703 | $ | 302,613 | ||||
Borrowings outstanding under line of credit | $ | — | $ | — | ||||
Working capital | $ | 230,082 | $ | 338,761 |
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