FOR IMMEDIATE RELEASE Investor Contact: David Tucker 281-406-2370
Media Contact: Marianne Gooch 281-406-2212
Parker Drilling Reports Fourth Quarter Results
Houston, February 8, 2005 - Parker Drilling Company (NYSE: PKD) today reported
fourth quarter revenues of $109.8 million and a net loss of $5.3 million or
$0.06 per share, compared to a net loss of $12.4 million or $0.13 per share, on
revenues of $91.6 million for the fourth quarter of 2003. The fourth quarter
loss from continuing operations was $2.2 million, or $0.03 per share, compared
to a loss of $15.2 million, or $0.16 per share, for the fourth quarter a year
ago.
The fourth quarter of 2004 included a number of non-routine items which
negatively impacted earnings by $8.3 million or $0.09 per share, of which $4.2
million, or $0.05 per share, was attributable to continuing operations. Absent
the $4.2 million of non-routine items, income from continuing operations would
have been a positive $2.0 million, or $0.02 per share. The $4.2 million of
non-routine items for continuing operations includes a $6.5 million provision
primarily related to reduction in the carrying value of four international land
rigs and two U.S. barge rigs partially offset by a $2.3 million gain on
disposition of assets primarily related to barge rig 74 in Nigeria. Discontinued
operations reflect a $4.1 million loss on jackup rig 25 which was sold in
January 2005. Excluding this loss, results from discontinued operations would
have reflected income of $1.0 million, or $0.01 per share. (See attached
reconciliation, non- routine items)
For 2004, Parker Drilling reported revenues of $376.5 million and a net loss of
$47.1 million, or $0.50 per share. This compares to revenues of $338.7 million
and a net loss of $109.7 million, or $1.17 per share, for 2003 which included an
impairment for assets held for sale of $54.0 million, or $0.58 per share. The
loss from continuing operations for 2004 was $50.6 million, or $0.54 per share
compared to a loss from continuing operations of $52.4 million, or $0.56 per
share, for 2003.
Excluding non-routine items, the Company's 2004 loss would have been $18.2
million, or $0.20 per share. Non-routine items in 2004 reduced earnings $28.9
million, or $0.30 per share, including $24.8 million, or $0.26 per share,
attributable to continuing operations and $4.1 million, or $0.04 per share,
attributable to discontinued operations. The non-routine items
include: $8.3 million in the fourth quarter detailed above; an $8.2 million loss
from extinguishing $80 million of 10.125% Senior Notes and $70 million of a Term
Loan with proceeds from issuing $150 million of Senior Floating Rate Notes; $6.6
million provision for reduction in carrying value of certain assets, which
includes reclassifying Latin American operations from discontinued to continuing
operations and an adjustment to a life insurance policy; $2.3 million for an
additional value added tax assessment in Nigeria; $2.1 million for taxes
assessed by the Mangistau Customs Control in connection with the temporary
import status of barge rig 257 in the Caspian Sea and $1.4 million relating to
severance costs. (See attached reconciliation, non-routine items)
Fourth quarter average rig utilization, before and after the reduction of seven
rigs to the marketable rig count, is reflected in the following table:
Utilization After Reduction Utilization Before Reduction
------------------------------------- ---------------------------------------
2004 2004
------------------------------------- ---------------------------------------
Marketable 4th 3rd Marketable 4th 3rd
Rigs Qtr. Qtr. Current Rigs Qtr. Qtr. Current
---------- ---- ---- ------- ---------- ---- ---- -------
International Land 38 58% 54% 61% 34 65% 61% 68%
International Offshore 6 45% 33% 67% 5 54% 40% 80%
Gulf of Mexico 20 71% 66% 70% 18 79% 74% 78%
---------- ----------
TOTAL 64 61% 56% 64% 57 68% 63% 72%
========== ==========
"Parker Drilling finished a year of transition with the best quarter for
operations since 2001," said Robert L. Parker, Jr., president and chief
executive officer. "With $135 million of debt paid down including $25 million
yesterday, a strong new chief operating officer in Dave Mannon and current
utilization of our existing rigs at 72%, Parker is well positioned to be
profitable in 2005."
Capital expenditures in 2004 totaled $47.3 million. Debt totaled $481.1 million
at December 31, 2004, and the Company's cash balance was $44.3 million.
Parker Drilling reaffirms its previously released guidance of net income per
share of $0.05 to $0.14 for 2005.
Parker has scheduled a conference call at 10 a.m. CST (11 a.m. EST)
February 8, 2005 to discuss fourth quarter 2004 results. Those interested in
participating in the call may dial in at (303) 262-2130. The conference call
replay can be accessed from noon CST February 8, 2005 through
February 15, 2005, by dialing (303) 590-3000 and using the access code
11021350#. Alternatively, the call can be accessed live through the Parker Web
site at http://www.parkerdrilling.com. The archived call will be available on
the Web site for 12 months.
###
This release contains certain statements that may be deemed to be
"forward-looking statements" within the meaning of the Securities Acts. All
statements, other than statements of historical facts, that address activities,
events or developments that the Company expects, projects, believes or
anticipates will or may occur in the future, including the outlook for rig
utilization and dayrates, general industry conditions including bidding
activity, future operating results of the Company's rigs and rental tool
operations, capital expenditures, expansion and growth opportunities, asset
sales and other such matters, are forward-looking statements. Although the
Company believes that its expectations stated in this release are based on
reasonable assumptions, actual results may differ materially from those
expressed or implied in the forward-looking statements. For a more detailed
discussion of risk factors, please refer to the Company's reports filed with the
SEC, and in particular, the report on Form 10-K for the year ended December 31,
2003. Each forward-looking statement speaks only as of the date of this release,
and the Company undertakes no obligation to publicly update or revise any
forward-looking statement.
PARKER DRILLING COMPANY AND SUBSIDIARIES
Consolidated Condensed Statements of Operations
(Unaudited)
Three Months Ended December 31, Twelve Months Ended December 31,
------------------------------- --------------------------------
2004 2003 2004 2003
------------- -------------- -------------- ---------------
(Dollars in Thousands)
DRILLING AND RENTAL REVENUES
U.S. Drilling $ 25,303 $ 17,856 $ 88,512 $ 67,449
International Drilling 64,608 59,473 220,846 216,567
Rental Tools 19,889 14,271 67,167 54,637
------------- ------------- ------------- -------------
TOTAL DRILLING AND RENTAL REVENUES 109,800 91,600 376,525 338,653
------------- ------------- ------------- -------------
DRILLING AND RENTAL OPERATING EXPENSES
U.S. Drilling 15,530 10,274 54,126 47,740
International Drilling 46,233 40,803 168,451 152,201
Rental Tools 8,154 6,183 28,037 23,051
Depreciation and Amortization 18,642 17,099 69,241 73,679
------------- ------------- ------------- -------------
TOTAL DRILLING AND RENTAL OPERATING EXPENSES 88,559 74,359 319,855 296,671
------------- ------------- ------------- -------------
DRILLING AND RENTAL OPERATING INCOME 21,241 17,241 56,670 41,982
------------- ------------- ------------- -------------
Construction Contract Revenue - - - 7,030
Construction Contract Expense - - - 5,030
------------- ------------- ------------- -------------
NET CONSTRUCTION CONTRACT OPERATING INCOME - - - 2,000
------------- ------------- ------------- -------------
General and Administrative Expense (5,455) (4,771) (23,413) (19,256)
Provision for Reduction in Carrying Value of Certain Assets (6,562) (6,028) (13,120) (6,028)
Gain on Disposition of Assets, Net 2,328 2,885 3,730 4,229
------------- ------------- ------------- -------------
TOTAL OPERATING INCOME 11,552 9,327 23,867 22,927
------------- ------------- ------------- -------------
OTHER INCOME AND (EXPENSE)
Interest Expense (11,291) (13,889) (50,368) (53,790)
Change in Fair Value of Derivative Position 586 - (794) -
Loss on Extinguishment of Debt (24) (5,274) (8,753) (5,274)
Other Income (Expense) - Net 31 (15) 492 688
------------- ------------- ------------- -------------
TOTAL OTHER INCOME AND (EXPENSE) (10,698) (19,178) (59,423) (58,376)
------------- ------------- ------------- -------------
INCOME (LOSS) BEFORE INCOME TAXES 854 (9,851) (35,556) (35,449)
Income Tax Expense 3,001 5,317 15,009 16,985
------------- ------------- ------------- -------------
LOSS FROM CONTINUING OPERATIONS (2,147) (15,168) (50,565) (52,434)
Discontinued Operations, Net of Taxes (3,104) 2,734 3,482 (57,265)
------------- ------------- ------------- -------------
NET LOSS $ (5,251) $ (12,434) $ (47,083) $ (109,699)
============== ============= ============= =============
EARNINGS (LOSS) PER SHARE - BASIC AND DILUTED
Loss From Continuing Operations $ (0.03) $ (0.16) $ (0.54) $ (0.56)
Discontinued Operations, Net of Taxes $ (0.03) $ 0.03 $ 0.04 $ (0.61)
Net Loss $ (0.06) $ (0.13) $ (0.50) $ (1.17)
AVERAGE COMMON SHARES OUTSTANDING
Basic and Diluted 94,615,448 94,079,159 94,113,257 93,420,713
PARKER DRILLING COMPANY AND SUBSIDIARIES
Consolidated Condensed Balance Sheets
(Unaudited)
December 31, 2004 December 31, 2003
------------------- -------------------
ASSETS (Dollars in Thousands)
CURRENT ASSETS
Cash and Cash Equivalents $ 44,267 $ 67,765
Accounts and Notes Receivable, Net 99,315 89,050
Rig Materials and Supplies 19,206 13,627
Other Current Assets 19,470 2,466
------------------- -------------------
TOTAL CURRENT ASSETS 182,258 172,908
------------------- -------------------
PROPERTY, PLANT AND EQUIPMENT, NET 382,824 387,664
ASSETS HELD FOR SALE 23,665 150,370
OTHER ASSETS
Goodwill 107,606 114,398
Other Assets 26,343 22,292
------------------- -------------------
TOTAL OTHER ASSETS 133,949 136,690
------------------- -------------------
TOTAL ASSETS $ 722,696 $ 847,632
=================== ===================
LIABILITIES AND STOCKHOLDERS' EQUITY
CURRENT LIABILITIES
Current Portion of Long-Term Debt $ 24 $ 60,225
Accounts Payable and Accrued Liabilities 87,329 68,404
------------------- -------------------
TOTAL CURRENT LIABILITIES 87,353 128,629
------------------- -------------------
LONG-TERM DEBT 481,039 511,400
DISCONTINUED OPERATIONS - 6,421
OTHER LIABILITIES 5,387 8,379
STOCKHOLDERS' EQUITY 148,917 192,803
------------------- -------------------
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 722,696 $ 847,632
=================== ===================
Current Ratio 2.09 1.34
Total Long Term Debt as a Percent of Capitalization 76% 73%
Book Value Per Common Share $ 1.57 $ 2.05
PARKER DRILLING COMPANY AND SUBSIDIARIES
Selected Financial Data
(Unaudited)
Three Months Ended
---------------------------------------------------
December 31, September 30,
------------------------------- -------------
2004 2003 2004
------------ ------------ ------------
DRILLING AND RENTAL REVENUES (Dollars in Thousands)
U.S. Drilling $ 25,303 $ 17,856 $ 22,788
International Land Drilling 56,502 41,417 45,918
International Offshore Drilling 8,106 18,056 3,768
Rental Tools 19,889 14,271 15,471
------------ ------------ ------------
Total Drilling and Rental Revenues 109,800 91,600 87,945
------------ ------------ ------------
DRILLING AND RENTAL OPERATING EXPENSES
U.S. Drilling 15,530 10,274 13,399
International Land Drilling 40,727 29,172 33,553
International Offshore Drilling 5,506 11,631 10,271
Rental Tools 8,154 6,183 6,558
------------ ------------ ------------
Drilling and Rental Operating Expenses 69,917 57,260 63,781
------------ ------------ ------------
DRILLING AND RENTAL OPERATING INCOME
U.S. Drilling 9,773 7,582 9,389
International Land Drilling 15,775 12,245 12,365
International Offshore Drilling 2,600 6,425 (6,503)
Rental Tools 11,735 8,088 8,913
Depreciation and Amortization (18,642) (17,099) (17,806)
------------ ------------ ------------
Total Drilling and Rental Operating Income 21,241 17,241 6,358
General and Administrative Expense (5,455) (4,771) (4,924)
Provision for Reduction in Carrying Value of Certain Assets (6,562) (6,028) --
Gain on Disposition of Assets, Net 2,328 2,885 333
------------ ------------ ------------
TOTAL OPERATING INCOME $ 11,552 $ 9,327 $ 1,767
============ ============ ============
Marketable Rig Count Summary
As of January 31, 2005
Total
------------
U.S. Gulf of Mexico Barge Rigs
Workover 6
Intermediate 4
Deep 8
------------
Total U.S. Gulf of Mexico Barge Rigs 18
------------
International Land Rigs
Asia Pacific 10
Africa/Middle East 2
Latin America 14
CIS 8
------------
Total International Land Rigs 34
International Barge Rigs
Mexico 1
Nigeria 3
Caspian Sea 1
------------
Total International Barge Rigs 5
------------
Total International Rigs 39
------------
------------
Total Marketable Rigs 57
===========
PARKER DRILLING COMPANY AND SUBSIDIARIES
Reconciliation, Non-Routine Items
(Unaudited)
Three Months Ended
-----------------------------------------------
December 31, 2004
-----------------------------------------------
(Dollars in Millions, Except Per Share Amounts)
Loss From Continuing Operations, as Reported $ (2.2) $ (0.03)
------------ ------------
Non-Routine Items:
Provision for Reduction in Carrying Value of Certain Assets 6.5 0.07
Gain on Disposition of Assets, Net (2.3) (0.02)
------------ ------------
Total Fourth Quarter Non-Routine Items 4.2 0.05
------------ ------------
Income From Continuing Operations, Excluding Non-Routine Items $ 2.0 $ 0.02
============ ============
Discontinued Operations, as Reported $ (3.1) $ (0.03)
Non-Routine Item:
Loss on Disposition of Asset 4.1 0.04
------------ ------------
Discontinued Operations, Excluding Non-Routine Item $ 1.0 $ 0.01
============ ============
Net Loss, as Reported $ (5.3) $ (0.06)
Total Non-Routine Items 8.3 0.09
------------ ------------
Net Income, Excluding Non-Routine Items $ 3.0 $ 0.03
============ ============
Twelve Months Ended
-----------------------------------------------
December 31, 2004
-----------------------------------------------
(Dollars in Millions, Except Per Share Amounts)
Loss From Continuing Operations, as Reported $ (50.6) $ (0.54)
------------ ------------
Non-Routine Items:
Provision for Reduction in Carrying Value of Certain Assets 13.1 0.14
Gain on Disposition of Assets, Net (2.3) (0.02)
Extinguishment Costs Related to Debt Refinancing 8.2 0.09
Value Added Tax Assessment - Nigeria 2.3 0.02
Taxes Assessed for Temporary Import Status - Caspian Sea 2.1 0.02
Severance Costs 1.4 0.01
------------ ------------
Total 2004 Non-Routine Items 24.8 0.26
------------ ------------
Loss From Continuing Operations, Excluding Non-Routine Items $ (25.8) $ (0.28)
============ ============
Discontinued Operations, as Reported $ 3.5 $ 0.04
Non-Routine Item:
Loss on Disposition of Asset 4.1 0.04
------------ ------------
Discontinued Operations, Excluding Non-Routine Item $ 7.6 $ 0.08
============ ============
Net Loss, as Reported $ (47.1) $ (0.50)
Total Non-Routine Items 28.9 0.30
------------ ------------
Net Loss, Excluding Non-Routine Items $ (18.2) $ (0.20)
============ ============