Exhibit 99.1
PRESS RELEASE
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FOR IMMEDIATE RELEASE | | CONTACT: | | Christine Reel
713.629.1316 |
MITCHAM INDUSTRIES REPORTS SECOND QUARTER RESULTS
HUNTSVILLE, Texas – September 13, 2004 – Mitcham Industries, Inc. (NASDAQ: MIND) today reported revenues for its second quarter ended July 31, 2004 of $6.4 million, up 63% from revenues of $3.9 million recorded in the comparable quarter of the previous year. Net income for the second quarter totaled $155,000, or $0.02 per diluted share, as compared to a net loss in the prior year of $4.1 million, or ($0.47) per diluted share (inclusive of discontinued operations). During the quarter, the Company incurred one-time severance-related charges of approximately $0.7 million related to the resignation of its former chief financial officer.
“We are very encouraged by the improvement in our second quarter results and in the seismic exploration market as a whole,” said Billy F. Mitcham, Jr., President and CEO of Mitcham Industries. “Historically, the second quarter is our seasonally slowest quarter, yet revenues increased significantly in our core land and marine leasing business and we experienced stronger used equipment sales. Various indicators, including recent bid activity, equipment movement and public announcements of companies adding crew capacity, suggest that the worst of the downturn may be behind us and that the seismic exploration market is in an uptrend.”
For the six months ended July 31, 2004, the Company recorded net income of $1.5 million, $0.17 per share, as compared to a net loss (inclusive of discontinued operations) of $5.6 million, or ($0.64) per share, for the prior year period. Revenues totaled $14.6 million as compared to $9.8 million for the comparable six-month period of the prior year.
Mitcham Industries, Inc., a geophysical equipment supplier, offers for lease or sale, new and “experienced” seismic equipment to the oil and gas industry, seismic contractors, environmental agencies, government agencies and universities. Headquartered in Texas, with sales and services offices in Calgary, Canada, Brisbane, Australia and associates throughout Europe, South America and Asia, Mitcham conducts operations on a global scale and is the largest independent exploration equipment lessor in the industry.
This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts included herein, including statements regarding potential future demand for the Company’s products and services, the Company’s future financial position and results of operations, business strategy and other plans and objectives for
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future operations, are forward-looking statements. Actual results may differ materially from such forward-looking statements. Important factors that could cause or contribute to such differences include a prolonged and gradual recovery, or no full recovery, of the energy services sector of a depressed oil and gas industry, and thereafter, the inherent volatility of oil and gas prices and the related volatility of demand for the Company’s services; loss of significant customers; significant defaults by customers on amounts due to the Company; international economic and political instability; dependence upon additional lease contracts; the risk of technological obsolescence of the Company’s lease fleet; vulnerability of seismic activity and demand to weather conditions and seasonality of operating results; dependence upon few suppliers; and other factors which are disclosed in the Company’s Securities and Exchange Commission filings, available from the Company without charge.
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MITCHAM INDUSTRIES, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands except share and per share data)
(Unaudited)
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| | | Three Months Ended | | Six Months Ended |
| | | July 31,
| | July 31,
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| | | 2004
| | 2003
| | 2004
| | 2003
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Revenues: | | | | | | | | | | | | | | | | |
| Equipment leasing | | $ | 3,378 | | | $ | 2,638 | | | $ | 8,779 | | | $ | 6,604 | |
| Equipment sales | | | 3,015 | | | | 1,291 | | | | 5,820 | | | | 3,193 | |
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| Total revenues | | | 6,393 | | | | 3,929 | | | | 14,599 | | | | 9,797 | |
Costs and expenses: | | | | | | | | | | | | | | | | |
| Direct costs — seismic leasing | | | 211 | | | | 512 | | | | 900 | | | | 861 | |
| Cost of equipment sales | | | 1,263 | | | | 557 | | | | 2,814 | | | | 1,746 | |
| General and administrative | | | 2,111 | | | | 1,248 | | | | 3,948 | | | | 2,530 | |
| Depreciation | | | 2,706 | | | | 3,830 | | | | 5,413 | | | | 7,431 | |
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| Total costs and expenses | | | 6,291 | | | | 6,147 | | | | 13,075 | | | | 12,568 | |
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Operating income (loss) | | | 102 | | | | (2,218 | ) | | | 1,524 | | | | (2,771 | ) |
| Other income (expense) — net | | | (27 | ) | | | (46 | ) | | | (79 | ) | | | (20 | ) |
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Income (loss) from continuing operations before income taxes | | | 75 | | | | (2,264 | ) | | | 1,445 | | | | (2,791 | ) |
| Provision for income taxes | | | — | | | | — | | | | — | | | | — | |
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Net income (loss) from continuing operations | | | 75 | | | | (2,264 | ) | | | 1,445 | | | | (2,791 | ) |
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| Income (loss) from discontinued operations, net of income taxes of $0 | | | 80 | | | | (1,879 | ) | | | 80 | | | | (2,792 | ) |
Net income (loss) | | $ | 155 | | | $ | (4,143 | ) | | $ | 1,525 | | | $ | (5,583 | ) |
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| Income (loss) per common share from continuing operations | | | | | | | | | | | | | | | | |
| Basic | | $ | 0.01 | | | $ | (0.26 | ) | | $ | 0.16 | | | $ | (0.32 | ) |
| Diluted | | $ | 0.01 | | | $ | (0.26 | ) | | $ | 0.16 | | �� | $ | (0.32 | ) |
| Income (loss) per common share from discontinued operations | | | | | | | | | | | | | | | | |
| Basic and diluted | | $ | 0.01 | | | $ | (0.21 | ) | | $ | 0.01 | | | $ | (0.32 | ) |
| Net income (loss) per common share — basic and diluted | | $ | 0.02 | | | $ | (0.47 | ) | | $ | 0.17 | | | $ | (0.64 | ) |
| Shares used in computing income (loss) per common share: | | | | | | | | | | | | | | | | |
| Basic | | | 8,791,000 | | | | 8,751,000 | | | | 8,795,000 | | | | 8,747,000 | |
| Dilutive effect of common stock equivalents | | | 369,000 | | | | — | | | | 372,000 | | | | — | |
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| Diluted | | | 9,160,000 | | | | 8,751,000 | | | | 9,167,000 | | | | 8,747,000 | |
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M O R E
MITCHAM INDUSTRIES, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(IN THOUSANDS EXCEPT SHARE DATA)
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| | | July 31, | | January 31, |
| | | 2004
| | 2004
|
| | | (Unaudited) | | | | |
| ASSETS | | | | | | | | |
Current Assets: | | | | | | | | |
| Cash and cash equivalents | | $ | 11,609 | | | $ | 6,834 | |
| Accounts receivable, net of allowance for doubtful accounts of $822 and $847 | | | 5,743 | | | | 5,635 | |
| Current portion of notes receivable, net of allowance for doubtful notes of $53 and $28 | | | 307 | | | | 811 | |
| Prepaid expenses and other current assets | | | 452 | | | | 700 | |
| Current assets of discontinued operations | | | 336 | | | | 898 | |
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| Total current assets | | | 18,447 | | | | 14,878 | |
| Seismic equipment lease pool, property and equipment | | | 77,287 | | | | 84,624 | |
| Accumulated depreciation of seismic equipment lease pool, property and equipment | | | (57,086 | ) | | | (59,265 | ) |
| Long-term assets of discontinued operations | | | 353 | | | | 491 | |
| Other assets | | | 7 | | | | 2 | |
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| Total assets | | $ | 39,008 | | | $ | 40,730 | |
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| LIABILITIES AND SHAREHOLDERS’ EQUITY | | | | | | | | |
Current Liabilities: | | | | | | | | |
| Accounts payable | | $ | 1,573 | | | $ | 1,532 | |
| Current maturities — long-term debt | | | 2,246 | | | | 2,203 | |
| Equipment notes payable | | | — | | | | 1,296 | |
| Deferred revenue | | | 369 | | | | 345 | |
| Wages payable | | | 575 | | | | 495 | |
| Accrued expenses and other current liabilities | | | 402 | | | | 1,245 | |
| Current liabilities of discontinued operations | | | 15 | | | | 399 | |
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| Total current liabilities | | | 5,180 | | | | 7,515 | |
| Long-term debt, net of current maturities | | | 1,280 | | | | 2,418 | |
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| Total liabilities | | | 6,460 | | | | 9,933 | |
Shareholders’ Equity: | | | | | | | | |
| Preferred stock, $1.00 par value; 1,000,000 shares authorized; none issued and outstanding | | | — | | | | — | |
| Common stock, $0.01 par value; 20,000,000 shares authorized; 9,707,994 and 9,714,994 shares issued, respectively | | | 97 | | | | 97 | |
| Additional paid-in capital | | | 62,298 | | | | 61,913 | |
| Treasury stock, at cost, 915,000 shares | | | (4,686 | ) | | | (4,686 | ) |
| Deferred compensation | | | (51 | ) | | | (83 | ) |
| Accumulated deficit | | | (26,886 | ) | | | (28,411 | ) |
| Accumulated other comprehensive income | | | 1,776 | | | | 1,967 | |
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| Total shareholders’ equity | | | 32,548 | | | | 30,797 | |
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| Total liabilities and shareholders’ equity | | $ | 39,008 | | | $ | 40,730 | |
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