Exhibit 99.1
| | | |
| | | For Immediate Release |
PRESS RELEASE | | Contact: Investor Relations |
| | | Tel: 281.529.7799 |
GLOBAL INDUSTRIES, LTD. ANNOUNCES
NEW CHIEF EXECUTIVE OFFICER AND RESULTS
FOR THE FOURTH QUARTER AND YEAR END 2009
Carlyss, Louisiana, February 24, 2010 — Global Industries, Ltd. (Nasdaq: GLBL) today announced the appointment of a new Chief Executive Officer and results for the fourth quarter and year ended December 31, 2009.
The Company announced that John B. Reed, Jr. has been named Chief Executive Officer of the Company, effective March 2, 2010. Mr. Reed will also become a Director of the Company effective on the same date. John A. Clerico will continue to serve as Chairman of the Board to ensure a smooth transition.
Mr. Clerico stated, “On behalf of our entire Board of Directors, I am very pleased to welcome John Reed to Global Industries. His industry knowledge, operating experience and proven leadership capabilities make him an ideal candidate to lead the Company. In addition to improving Global’s position in our traditional offshore marine services markets, John has the vision and skills to lead Global in the deepwater market with our new Global 1200 and Global 1201. I know he will receive strong support from the entire Global team.”
John Reed joins Global with more than thirty years experience in the offshore construction industry. Most recently, he served as Chief Executive Officer of Heerema Marine Contractors after holding a number of other senior roles with the Heerema Group including Chief Executive Officer of INTEC Engineering, Inc. He previously held a number of other management roles at Heerema in project management, business development and engineering capacities. He holds a Bachelors degree in Engineering from the University of Mississippi and an MBA from Delta State University. Mr. Reed previously served as a member of the Board of Directors of the National Ocean Industries Association, is a past President of the International Pipeline and Marine Contractors Association and past Chairman of the International Marine Contractors Association, America’s Deepwater Division.
With respect to the results for the fourth quarter of 2009, revenues were $146.3 million compared to $250.4 million for the fourth quarter of 2008. Net loss was $5.3 million, or $0.05 per diluted share, for the fourth quarter of 2009 compared to a net loss of $28.1 million, or $0.25 per diluted share, for the fourth quarter of 2008.
Revenues were $914.3 million in fiscal year 2009 compared to $1.07 billion in fiscal year 2008. Net income was $73.7 million, or $0.64 per diluted share, in fiscal year 2009. This compares to a net loss of $119.2 million, or $1.05 per diluted share, in fiscal year 2008.
Commenting on the fourth quarter results, Chairman and Chief Executive Officer John A. Clerico stated, “The winter seasonal downturn, as well as continued delays and postponements of new offshore oil and gas projects, have impacted our fourth quarter results. We have taken proactive steps to cut costs in an effort to better align the cost of our operations with our revenues, which include stacking idle vessels and seasonal layoffs. We are committed to winning business, increasing our project backlog and successfully
executing projects for our customers. While our order backlog declined from last year’s level of $519.7 million to $103.8 million at the end of 2009, we were successful in booking an additional $91.4 million of new work during January, 2010. Our plan for 2010 is to aggressively and strategically pursue new projects in our niche markets. While we have substantially completed our cost cutting activities, we shall continue to proactively implement cost control measures to appropriately size our operations, as needed.
Mr. Clerico further stated, “We are pleased to also announce that our and the Government’s investigation of our activities in West Africa have concluded without any fines or penalties being imposed upon the Company. Both the DOJ and SEC have concluded their investigations and are not recommending any enforcement actions against the Company. We remain committed to conducting our operations in an ethical fashion and in compliance with applicable laws.”
A conference call will be held at 9:00 a.m. Central Standard Time on February 25, 2010. Anyone wishing to listen to the conference call may dial 888-677-0183 (domestic) or 1-773-756-0451 (international) and request connection to the “Global Fourth Quarter Earnings” call. Phone lines will open fifteen minutes prior to the start of the call. The call will also be webcast in real time on the Company’s website at www.globalind.com, where it will also be archived for anytime reference until March 18, 2010.
All individuals listening to the conference call or the replay are reminded that all conference call material is copyrighted by Global and cannot be recorded or rebroadcast without Global’s express written consent.
Global Industries, Ltd. is a leading offshore solutions provider of offshore construction, engineering, project management, and support services including pipeline construction, platform installation and removal, deepwater/SURF installations, IRM, and diving to the oil and gas industry worldwide. The Company’s shares are traded on The NASDAQ Global Select Market under the symbol “GLBL.”
This press release may contain forward-looking information based on current information and expectations of the Company that involve a number of risks, uncertainties, and assumptions. Among the factors that could cause the actual results to differ materially are: industry conditions, prices of crude oil and natural gas, the Company’s ability to obtain and the timing of new projects, and changes in competitive factors. Should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual outcomes could vary materially from those indicated.
New guidance regarding accounting for convertible debt instruments that may be settled in cash upon conversion became effective for our Company beginning January 1, 2009 and is applied retrospectively to all periods presented in this news release.
Set forth are the Company’s results of operations for the periods indicated.
RESULTS OF OPERATONS
(In thousands, except per share amounts)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | Twelve Months Ended | |
| | | December 31, | | | December 31, | |
| | | 2009 | | | 2008 | | | 2009 | | | 2008 | |
Results of Operations | | | | | | | | | | | | | | | | |
| Revenues | | $ | 146,338 | | | $ | 250,429 | | | $ | 914,348 | | | $ | 1,070,988 | |
| Cost of operations | | | 137,692 | | | | 237,330 | | | | 755,301 | | | | 1,084,581 | |
| | | | | | | | | | | | | |
Gross profit (loss) | | | 8,646 | | | | 13,099 | | | | 159,047 | | | | (13,593 | ) |
| Loss (gain) on asset disposals and impairments | | | 1,084 | | | | 1,228 | | | | (7,165 | ) | | | 856 | |
| Selling, general and administrative expenses | | | 13,530 | | | | 21,925 | | | | 69,165 | | | | 95,364 | |
| | | | | | | | | | | | | |
Operating income (loss) | | | (5,968 | ) | | | (10,054 | ) | | | 97,047 | | | | (109,813 | ) |
| | | | | | | | | | | | | |
| Interest income | | | 426 | | | | 1,768 | | | | 2,020 | | | | 14,477 | |
| Interest expense | | | (3,083 | ) | | | (3,861 | ) | | | (13,061 | ) | | | (16,439 | ) |
| Other income (expense), net | | | 723 | | | | 1,225 | | | | 7,302 | | | | (641 | ) |
| | | | | | | | | | | | | |
Income (loss) before taxes | | | (7,902 | ) | | | (10,922 | ) | | | 93,308 | | | | (112,416 | ) |
| Income tax (benefit) expense | | | (2,651 | ) | | | 17,139 | | | | 19,577 | | | | 6,775 | |
| | | | | | | | | | | | | |
Net income (loss) | | $ | (5,251 | ) | | $ | (28,061 | ) | | $ | 73,731 | | | $ | (119,191 | ) |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Earnings (Loss) Per Common Share | | | | | | | | | | | | | | | | |
| Basic | | $ | (0.05 | ) | | $ | (0.25 | ) | | $ | 0.65 | | | $ | (1.05 | ) |
| Diluted | | $ | (0.05 | ) | | $ | (0.25 | ) | | $ | 0.64 | | | $ | (1.05 | ) |
| | | | | | | | | | | | | | | | | |
Weighted Average Common Shares Outstanding | | | | | | | | | | | | | | | | |
| Basic | | | 112,872 | | | | 112,190 | | | | 112,631 | | | | 113,647 | |
| Diluted | | | 112,872 | | | | 112,190 | | | | 113,125 | | | | 113,647 | |
| | | | | | | | | | | | | | | | | |
Other Data | | | | | | | | | | | | | | | | |
| Depreciation and amortization | | $ | 13,413 | | | $ | 16,439 | | | $ | 66,047 | | | $ | 67,163 | |
| Backlog at End of Period | | | | | | | | | | $ | 103,758 | | | $ | 519,652 | |
During the first quarter of 2009, we discontinued allocation of corporate stewardship costs to our reportable segments. This change has been reflected as a retrospective change to the financial information for the three months and twelve months ended December 31, 2009 presented below. This change did not affect our consolidated results of operations or tax reporting.
Set forth are the Company’s results of operations by reportable segment for the periods indicated.
RESULTS OF OPERATIONS BY REPORTABLE SEGMENT
(In thousands)
(Unaudited)
| | | | | | | | | | | | | | | | | |
| | | Three Months Ended | | | Twelve Months Ended | |
| | | December 31 | | | December 31 | |
| | | 2009 | | | 2008 | | | 2009 | | | 2008 | |
Total segment revenues | | | | | | | | | | | | | | | | |
| North America OCD | | $ | 15,788 | | | $ | 22,697 | | | $ | 124,749 | | | $ | 81,137 | |
| North America Subsea | | | 46,836 | | | | 42,983 | | | | 158,929 | | | | 146,105 | |
| Latin America | | | 43,739 | | | | 81,715 | | | | 229,273 | | | | 266,974 | |
| West Africa | | | 3,261 | | | | 12,213 | | | | 104,300 | | | | 152,877 | |
| Middle East | | | 6,205 | | | | 49,438 | | | | 88,372 | | | | 237,523 | |
| Asia Pacific/India | | | 37,561 | | | | 51,133 | | | | 244,441 | | | | 223,450 | |
| | | | | | | | | | | | | |
| Subtotal | | | 153,390 | | | | 260,179 | | | | 950,064 | | | | 1,108,066 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Intersegment eliminations | | | | | | | | | | | | | | | | |
| North America OCD | | | (978 | ) | | | — | | | | (978 | ) | | | — | |
| North America Subsea | | | (6,074 | ) | | | (7,526 | ) | | | (31,468 | ) | | | (30,713 | ) |
| Latin America | | | — | | | | (650 | ) | | | — | | | | (2,724 | ) |
| Middle East | | | — | | | | (1,574 | ) | | | (3,270 | ) | | | (3,641 | ) |
| | | | | | | | | | | | | |
| Subtotal | | | (7,052 | ) | | | (9,750 | ) | | | (35,716 | ) | | | (37,078 | ) |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Consolidated revenues | | $ | 146,338 | | | $ | 250,429 | | | $ | 914,348 | | | $ | 1,070,988 | |
| | | | | | | | | | | | | |
| | | | | | | | | | | | | | | | | |
Income (loss) before taxes | | | | | | | | | | | | | | | | |
| North America OCD | | $ | (6,260 | ) | | $ | (3,090 | ) | | $ | (1,336 | ) | | $ | (14,963 | ) |
| North America Subsea | | | 8,907 | | | | 4,356 | | | | 34,879 | | | | 11,262 | |
| Latin America | | | (3,609 | ) | | | 2,917 | | | | 8,216 | | | | (9,215 | ) |
| West Africa | | | (2,682 | ) | | | (14,083 | ) | | | 27,468 | | | | (33,470 | ) |
| Middle East | | | (7,012 | ) | | | (1,900 | ) | | | 8,901 | | | | (75,668 | ) |
| Asia Pacific/India | | | 6,968 | | | | 11,370 | | | | 41,319 | | | | 46,687 | |
| Corporate | | | (4,214 | ) | | | (10,492 | ) | | | (26,139 | ) | | | (37,049 | ) |
| | | | | | | | | | | | | |
Consolidated income (loss) before taxes | | $ | (7,902 | ) | | $ | (10,922 | ) | | $ | 93,308 | | | $ | (112,416 | ) |
| | | | | | | | | | | | | |
CONSOLIDATED BALANCE SHEETS
(in thousands)
(Unaudited)
| | | | | | | | | |
| | | December 31, | |
| | | 2009 | | | 2008 | |
ASSETS | | | | | | | | |
Current Assets | | | | | | | | |
| Cash and cash equivalents | | $ | 344,855 | | | $ | 287,669 | |
| Restricted cash | | | 1,139 | | | | 94,516 | |
| Marketable securities | | | 30,750 | | | | — | |
| Accounts receivable — net of allowance of $2,765 for 2009 and $12,070 for 2008 | | | 160,273 | | | | 180,018 | |
| Unbilled work on uncompleted contracts | | | 92,569 | | | | 86,011 | |
| Contract costs incurred not yet recognized | | | 489 | | | | 11,982 | |
| Deferred income taxes | | | 2,945 | | | | 7,223 | |
| Assets held for sale | | | 16,152 | | | | 2,181 | |
| Prepaid expenses and other | | | 31,596 | | | | 44,585 | |
| | | | | | | |
| Total current assets | | | 680,768 | | | | 714,185 | |
| | | | | | | |
Property and Equipment, net | | | 722,819 | | | | 599,078 | |
| | | | | | | | |
Other Assets | | | | | | | | |
| Marketable securities — long-term | | | 11,097 | | | | 42,375 | |
| Accounts receivable — long-term | | | 12,294 | | | | 22,246 | |
| Deferred charges, net | | | 49,866 | | | | 70,573 | |
| Goodwill | | | 37,388 | | | | 37,388 | |
| Other | | | 9,961 | | | | 3,508 | |
| | | | | | | |
| Total other assets | | | 120,606 | | | | 176,090 | |
| | | | | | | |
Total | | $ | 1,524,193 | | | $ | 1,489,353 | |
| | | | | | | |
| | | | | | | | | |
LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | |
Current Liabilities | | | | | | | | |
| Current maturities of long term debt | | $ | 3,960 | | | $ | 3,960 | |
| Accounts payable | | | 192,008 | | | | 207,239 | |
| Employee-related liabilities | | | 18,079 | | | | 26,113 | |
| Income taxes payable | | | 45,301 | | | | 38,649 | |
| Accrued anticipated contract losses | | | 322 | | | | 35,055 | |
| Other accrued liabilities | | | 15,489 | | | | 22,275 | |
| | | | | | | |
| Total current liabilities | | | 275,159 | | | | 333,291 | |
| | | | | | | |
| | | | | | | | | |
Long-Term Debt | | | 294,366 | | | | 289,966 | |
Deferred Income Taxes | | | 69,998 | | | | 64,020 | |
Other Liabilities | | | 15,171 | | | | 13,266 | |
| | | | | | | | | |
Commitments and Contingencies | | | — | | | | — | |
| | | | | | | | | |
Shareholders’ Equity | | | | | | | | |
| Common stock, $0.01 par value, 150,000 authorized, and 119,989 and 119,650 shares issued at December 31, 2009 and 2008, respectively | | | 1,200 | | | | 1,197 | |
| Additional paid-in capital | | | 513,353 | | | | 509,345 | |
| Retained earnings | | | 468,430 | | | | 394,699 | |
| Treasury stock at cost, 6,130 shares | | | (105,038 | ) | | | (105,038 | ) |
| Accumulated other comprehensive loss | | | (8,446 | ) | | | (11,393 | ) |
| | | | | | | |
| Total shareholders’ equity | | | 869,499 | | | | 788,810 | |
| | | | | | | |
| | | | | | | | | |
Total | | $ | 1,524,193 | | | $ | 1,489,353 | |
| | | | | | | |
- End -
