EXHIBIT 99.2
FOR IMMEDIATE RELEASE
BLACK WARRIOR WIRELINE CORP. ANNOUNCES NINE-MONTH OPERATING RESULTS
TUESDAY, NOVEMBER 15, 2005
Columbus, Mississippi. Black Warrior Wireline Corp. (OTCBB-BWWL) ("Black
Warrior" or the "Company") today reported improved results for the third fiscal
quarter of 2005 and the nine months ended September 30, 2005 as compared to the
same periods of 2004.
Revenues for the three months ended September 30, 2005 of $17,421,589 increased
by $2,470,802 over revenues for the three months ended September 30, 2004 of
$14,950,787 or an increase of approximately 16.5%. Revenues for the nine months
ended September 30, 2005 of $51,578,843 increased by $12,918,388 over revenues
for the nine months ended September 30, 2004 of $38,660,455 or an increase of
approximately 33.4%. Income before discontinued operations was $2,223,728 and
$6,583,603 for the three and nine months ended September 30, 2005 compared with
income (loss) before discontinued operations of $841,032 and $(1,100,621) for
the three and nine months ended September 30, 2004. For the three and nine
months ended September 30, 2005, Black Warrior had net income of $2,223,728 and
$6,583,603, respectively, compared with net income (loss) of $847,626 and
$(2,585,195), respectively, for the three and nine months ended September 30,
2004. The net loss in the nine months ended September 30, 2004 included the loss
from operations of the discontinued directional drilling segment of $(1,484,574)
for the nine-month period of 2004. Net income per share, basic and diluted, was
$0.18 during the three months ended September 30, 2005 and $0.53 during the nine
months ended September 30, 2005. For the three and nine months ended September
30, 2004, the net income (loss) per share, basic and diluted, was $0.07 and
$(0.21), respectively. Excluded from the computation of earnings per share are
137,996,386 shares at September 30, 2005 and 153,455,057 shares at September 30,
2004 issuable on exercise or conversion of outstanding options, warrants and
convertible notes of which 137,991,386 shares and 153,450,057 shares,
respectively, are issuable at an exercise or conversion price of $0.75 per
share, and the remaining shares are exercisable on exercise of options at higher
exercise prices up to $2.63 per share. These shares were not included in the
computation of basic or diluted earnings per share in either 2005 or 2004
because the effect would have been anti-dilutive.
5
Revenues and net income for the three months ended September 30, 2005 decreased
by approximately $2.3 million and $1.5 million, respectively, from the three
months ended June 30, 2005 primarily as the result of the effect of weather on
the Company's offshore wireline operations in the Gulf of Mexico.
EBITDA* for the three months ended September 30, 2005 of $4,519,933 increased by
$1,122,386 over EBITDA for the three months ended September 30, 2004 of
$3,397,547 or an increase of approximately 33.0%. EBITDA for the nine months
ended September 30, 2005 of $13,644,142 increased by $6,973,029 over EBITDA for
the nine months ended September 30, 2004 of $6,671,113 or an increase of
approximately 104.5%.
Management attributed the improved performance to an increase in demand in the
oilfield service sector. Bill Jenkins, President and CEO, commented, "Our
operating results for the first three quarters of 2005 have shown significant
improvements and we expect continued improved performance through the balance of
2005 as compared to 2004." Black Warrior is a natural gas and oil service
company providing services to natural gas and oil well operators primarily in
the United States and in the Gulf of Mexico. It is headquartered in Columbus,
Mississippi. Additional information may be obtained by contacting Ron Whitter at
(662) 329-1047.
* See attached Reconciliation of Non-GAAP Financial Measures
6
Black Warrior Wireline Corp.
Summarized Financial Information
(In thousands, except for per share income (loss) data
THREE MONTHS NINE MONTHS
ENDED ENDED
September 30, September 30, September 30, September 30,
2005 2004 2005 2004
-------------- -------------- -------------- --------------
INCOME STATEMENT DATA
Revenues $17,422 $14,951 $51,579 $38,660
Expenses
Operating Costs $10,548 $9,185 $31,177 $25,050
Selling, general and administrative
expenses $2,353 $2,368 $6,758 $6,939
Depreciation and amortization $1,167 $1,209 $3,730 $3,947
EBITDA * $4,520 $3,397 $13,644 $6,671
Net income (loss) $2,224 $848 $6,584 $(2,585)
Per Share Data
Net Income (loss) - basic and diluted $0.18 $0.07 $0.53 $(0.21)
Weighted average shares outstanding -
Basic and diluted 12,499,528 12,499,528 12,499,528 12,499,528
SEPTEMBER DECEMBER 31,
30, 2005 2004
-------------- --------------
BALANCE SHEET DATA
Total current assets $19,783 $15,665
Total assets $36,428 $30,109
Total current liabilities $7,048 $8,789
Total Stockholders' deficit $(18,625) $(25,209)
Total liabilities and stockholders' deficit $36,428 $30,109
* See attached Reconciliation of Non-GAAP Financial Measures
7
Reconciliation of Non-GAAP Financial Measures
To fully assess Black Warrior's operating results, management believes that,
although not prescribed under generally accepted accounting principals ("GAAP"),
EBITDA is an appropriate measure of Black Warrior's ability to satisfy capital
expenditure obligations and working capital requirements. EBITDA is a non-GAAP
financial measure as defined under SEC rules. Black Warrior's EBITDA should not
be considered in isolation or as a substitute for other financial measurements
prepared in accordance to GAAP or as a measure of the Company's profitability or
liquidity. As EBITDA excludes some, but not all, items that affect net income
and may vary among companies, the EBITDA presented below may not be comparable
to similarly titled measures of other companies. Management believes that
operating income (loss) calculated in accordance with GAAP is the most directly
comparable measure most similar to EBITDA.
EBITDA is defined as net income (loss) plus interest expense, depreciation and
amortization, deferred income taxes and other non-cash items. The following
table provides a reconciliation of EBITDA to income (loss) from operations for
the periods presented (in thousands).
Three months Nine months
ended September 30, ended September 30,
------------------------ ----------------------
2005 2004 2005 2004
------------ ----------- ---------- -----------
Reconciliation of income from
continuing operations
Income from continuing operations $3,353 $2,188 $9,914 $2,724
Depreciation and amortization 1,167 1,209 3,730 3,947
------------ ----------- ---------- -----------
EBITDA $4,520 $3,397 $13,644 $6,671
8
CAUTIONARY STATEMENT FOR PURPOSES OF THE "SAFE HARBOR" PROVISIONS OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995.
With the exception of historical matters, the matters discussed in this
press release are "forward-looking statements" as defined under the Securities
Exchange Act of 1934, as amended, that involve risks and uncertainties. The
Company intends that the forward-looking statements herein be covered by the
safe-harbor provisions for forward-looking statements contained in the
Securities Exchange Act of 1934, as amended, and this statement is included for
the purpose of complying with these safe-harbor provisions. Forward-looking
statements include, but are not limited to, the matters described herein. Such
forward-looking statements relate to the Company's ability to generate revenues
and attain and maintain profitability and cash flow, the stability and level of
prices for natural gas and oil, predictions and expectations as to the
fluctuations in the levels of natural gas and oil prices, pricing in the natural
gas and oil services industry and the willingness of customers to commit for
natural gas and oil well services, the ability of the Company to engage in and
complete the proposed recapitalization and restructuring of its balance sheet, a
the proposed underwritten public offering of its securities, the possible
refinancing of its outstanding indebtedness, the intended acquisition of Bobcat
on the terms agreed or on any other terms, a merger of the Company or sale of
its assets or another business combination transaction, the ability of the
Company to raise debt or equity capital to recapitalize or restructure its
balance sheet and to obtain additional financing when and if required, the
ability to maintain compliance with the covenants of its credit agreement and
other loan agreements pursuant to which securities, including debt instruments,
have been issued and obtain waivers of violations that occur and consents to
amendments as required, the ability to implement and, if appropriate, expand a
cost-cutting program, if required, the ability to compete in the premium natural
gas and oil services market and to re-deploy its equipment among regional
operations as required, and the ability of the Company to provide services using
state of the art tooling. The inability of the Company to meet these objectives
or requirements or the consequences on the Company from adverse developments in
general economic conditions, changes in capital markets, adverse developments in
the natural gas and oil industry, developments in international relations and
the commencement or expansion of hostilities by the United States or other
governments and events of terrorism, declines and fluctuations in the prices for
natural gas and oil, weather events disrupting natural gas and oil operations
and other factors could have a material adverse effect on the Company. Material
declines in the prices for natural gas and oil can be expected to adversely
affect the Company's revenues. The Company cautions readers that various risk
factors could cause the Company's operating results and financial condition to
differ materially from those expressed in any forward-looking statements made by
the Company and could adversely affect the Company's financial condition and its
ability to pursue its business strategy and plans. Readers should refer to the
Company's Annual Report on Form 10-K and the risk factors disclosed therein.
9