EXHIBIT 99.1
FOR IMMEDIATE RELEASE Contact: John E. Vollmer III
SVP-Corporate Development
Patterson-UTI Energy, Inc.
(214) 360-7800
PATTERSON-UTI ENERGY ANNOUNCES THIRD QUARTER RESULTS
NET INCOME UP 42 PERCENT OVER PRIOR QUARTER
SNYDER, TEXAS - OCTOBER 29, 2003 - PATTERSON-UTI ENERGY, INC. (NASDAQ:
PTEN), today announced financial results for the three and nine months ended
September 30, 2003.
The Company reported net income of $17.1 million, or $0.21 per share,
for the three-month period, compared to net income of $249,000, or $0.00 per
share, for the comparable three months in 2002. Revenues for the quarter were
$207.0 million, versus $133.5 million for the three months ended September 30,
2002.
Net income for the nine months ended September 30, 2003 was $34.9
million, or $0.43 per share, compared to net income of $339,000, or $0.00 per
share, for the nine months ended September 30, 2002. Revenues for the nine
months totaled $567.9 million, compared to $387.1 million for the comparable
nine-month period in 2002.
Cloyce A. Talbott, Patterson-UTI's Chief Executive Officer, commented,
"While demand for drilling rigs has remained relatively stable over the past
several months, we have increased average revenues and margin per drilling day.
Compared to the second quarter of 2003, our average revenue per drilling day
increased by $340 to $9,580 and our average margin per drilling day increased by
$370 to $2,600.
"During the third quarter of 2003, we had an average of 192 rigs
operating, including 11 in Canada. While we are beginning to see an increase in
the demand for drilling services, recent activity has been impacted by wet
conditions in Texas, which have caused delays in preparing drilling locations
and moving rigs. We estimate that our rig count will average 188 rigs operating
for October, including 12 in Canada, and expect our rig count to increase as the
negative effect of the wet conditions diminishes," Talbott added.
Mark S. Siegel, Chairman of Patterson-UTI Energy, stated, "Our results
again demonstrate the earnings leverage that we are able to achieve as daily
drilling margins improve. Net income for the quarter increased 42% compared to
the second quarter on a 6% increase in revenues.
"Looking ahead, we expect the demand for drilling rigs to increase in
the coming months as producers seek to overcome natural gas production declines
and to profit from the strong commodity prices," he added.
The results for the nine-month period in 2003 include income in the
amount of $2.5 million ($1.6 million after tax) from the collection of a
disputed receivable acquired in the 1999 merger with Norton Drilling Services,
Inc., as well as a net of tax charge of $469,000 resulting from a change in the
accounting rules (SFAS No.143) pertaining to the Company's exploration and
production activities. The results for the 2002 nine-month period include a
pretax charge of $4.7 million ($2.8 million after tax) due to the financial
failure of a workers' compensation insurance carrier that had provided coverage
for the Company between 1992 and March of 2001.
All references to "earnings per share" in this press release are
diluted earnings per share as defined within the Statement of Financial
Accounting Standards No. 128.
The Company will hold its quarterly conference call to discuss third
quarter results today at 11:00 a.m. Eastern (10:00 a.m. Central and 8:00 a.m.
Pacific). This call is being Webcast and can be accessed through Patterson-UTI's
Web site at www.patenergy.com or at www.streetevents.com in the Individual
Investor Center. Replay of the conference call Webcast will be available at
these same sites until Wednesday, November 12, 2003.
ABOUT PATTERSON-UTI
Patterson-UTI Energy, Inc. provides onshore contract drilling services
to exploration and production companies in North America. The Company owns 340
land-based drilling rigs that operate primarily in the oil and natural gas
producing regions of Texas, New Mexico, Oklahoma, Utah, Louisiana, Mississippi
and western Canada. Patterson-UTI Energy, Inc. is also engaged in the businesses
of pressure pumping services and drilling and completion fluid services.
Additionally, the Company has a small exploration and production business that
is based in Texas.
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, 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, adverse industry
conditions, difficulty in integrating acquisitions, demand for oil and natural
gas, 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. Copies of these filings may be obtained by
contacting the Company or the SEC.
PATTERSON-UTI ENERGY, INC.
Condensed Consolidated Statements of Income (Unaudited)
(in thousands, except per share data)
<Table>
<Caption>
Three Months Ended Nine Months Ended
September 30, September 30,
-------------------------- --------------------------
2003 2002 2003 2002
----------- ----------- ----------- -----------
REVENUES $ 207,015 $ 133,495 $ 567,878 $ 387,081
COSTS AND EXPENSES
Direct operating costs (excluding depreciation, depletion
and amortization) 148,700 103,374 420,917 294,206
Depreciation, depletion and amortization 24,716 23,178 73,825 68,470
Selling, general and administrative 6,853 6,186 20,560 19,139
Bad debt expense 97 165 259 195
Restructuring and other charges -- -- -- 4,700
Other (705) (91) (4,034) (149)
----------- ----------- ----------- -----------
Total Costs and Expenses 179,661 132,812 511,527 386,561
----------- ----------- ----------- -----------
OPERATING INCOME 27,354 683 56,351 520
----------- ----------- ----------- -----------
OTHER INCOME (EXPENSE)
Interest expense (68) (93) (216) (298)
Interest income 263 261 808 754
Other 52 (135) 137 (110)
----------- ----------- ----------- -----------
Total Other Income 247 33 729 346
----------- ----------- ----------- -----------
INCOME BEFORE INCOME TAXES AND CUMULATIVE
EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE 27,601 716 57,080 866
INCOME TAXES 10,488 467 21,690 527
----------- ----------- ----------- -----------
INCOME BEFORE CUMULATIVE EFFECT OF CHANGE
IN ACCOUNTING PRINCIPLE 17,113 249 35,390 339
CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING
PRINCIPLE, net of $287 income tax -- -- (469) --
----------- ----------- ----------- -----------
NET INCOME $ 17,113 $ 249 $ 34,921 $ 339
=========== =========== =========== ===========
NET INCOME PER COMMON SHARE
BASIC:
Income before cumulative effect of change in
accounting principle $ 0.21 $ 0.00 $ 0.44 $ 0.00
Cumulative effect of change in accounting principle -- -- (0.01) --
----------- ----------- ----------- -----------
Net Income $ 0.21 $ 0.00 $ 0.43 $ 0.00
=========== =========== =========== ===========
DILUTED:
Income before cumulative effect of change in
accounting principle $ 0.21 $ 0.00 $ 0.43 $ 0.00
Cumulative effect of change in accounting principle -- -- -- --
----------- ----------- ----------- -----------
Net Income $ 0.21 $ 0.00 $ 0.43 $ 0.00
=========== =========== =========== ===========
AVERAGE COMMON SHARES OUTSTANDING
Basic 80,904 78,964 80,535 78,378
=========== =========== =========== ===========
Diluted 82,191 80,963 82,261 80,782
=========== =========== =========== ===========
</Table>
PATTERSON-UTI ENERGY, INC.
Additional Financial and Operating Data (Unaudited)
(dollars in thousands)
<Table>
<Caption>
Three Months Ended Nine Months Ended
September 30, September 30,
2003 2002 2003 2002
---------- ---------- ---------- ----------
Contract Drilling:
Revenues $ 169,077 $ 100,267 $ 468,609 $ 300,668
Direct operating costs (excluding depreciation and amortization) $ 123,156 $ 80,374 $ 353,893 $ 232,129
Selling, general and administrative $ 1,110 $ 918 $ 3,339 $ 3,075
Operating days 17,652 11,656 51,263 33,052
Average revenue per operating day $ 9.58 $ 8.60 $ 9.14 $ 9.09
Average direct operating costs per operating day $ 6.98 $ 6.90 $ 6.90 $ 7.02
Average margin per operating day $ 2.60 $ 1.70 $ 2.24 $ 2.07
Number of owned rigs at end of period 340 324 340 324
Average number of rigs owned during period 340 324 334 322
Average rigs operating 192 127 188 121
Rig utilization percentage 56% 39% 56% 38%
Capital expenditures $ 26,598 $ 10,713 $ 67,537 $ 48,979
Drilling and Completion Fluids:
Revenues $ 19,580 $ 19,714 $ 51,431 $ 52,049
Direct operating costs (excluding depreciation and amortization) $ 17,180 $ 16,393 $ 45,483 $ 44,965
Selling, general and administrative $ 1,870 $ 1,783 $ 5,418 $ 5,271
Total jobs 459 383 1,460 1,056
Average revenue per job $ 42.66 $ 51.47 $ 35.23 $ 49.29
Average costs per job $ 37.43 $ 42.80 $ 31.15 $ 42.58
Average margin per job $ 5.23 $ 8.67 $ 4.08 $ 6.71
Capital expenditures $ 282 $ 154 $ 559 $ 1,095
Pressure Pumping:
Revenues $ 13,198 $ 9,649 $ 31,509 $ 23,691
Direct operating costs (excluding depreciation) $ 7,226 $ 5,618 $ 18,032 $ 14,127
Selling, general and administrative $ 1,375 $ 975 $ 4,131 $ 3,136
Total jobs 1,614 1,137 3,921 2,753
Average revenue per job $ 8.18 $ 8.49 $ 8.04 $ 8.61
Average costs per job $ 4.48 $ 4.94 $ 4.60 $ 5.13
Average margin per job $ 3.70 $ 3.55 $ 3.44 $ 3.48
Capital expenditures $ 2,880 $ 2,018 $ 8,999 $ 4,392
Oil and Natural Gas Production and Exploration:
Revenues $ 5,160 $ 3,865 $ 16,329 $ 10,673
Direct operating costs (excluding depreciation and depletion) $ 1,138 $ 989 $ 3,509 $ 2,985
Selling, general and administrative $ 358 $ 301 $ 1,090 $ 1,148
Capital expenditures $ 3,052 $ 1,014 $ 7,368 $ 5,441
Corporate and Other:
Selling, general and administrative $ 2,140 $ 2,209 $ 6,582 $ 6,509
Bad debt expense $ 97 $ 165 $ 259 $ 195
Other $ (705) $ (91) $ (4,034) $ 4,551
Capital expenditures $ -- $ 2,528 $ -- $ 2,528
Total capital expenditures, excluding acquisitions $ 32,812 $ 16,427 $ 84,463 $ 62,435
</Table>
<Table>
<Caption>
September 30, September 30,
2003 2002
------------- -------------
Selected Balance Sheet Data:
Cash and cash equivalents $ 111,317 $ 63,618
Current assets $ 293,140 $ 216,912
Total assets $ 1,040,847 $ 912,704
Current liabilities $ 111,078 $ 70,690
Long-term debt, less current maturities $ -- $ --
Working capital $ 182,062 $ 146,222
</Table>