Dril-Quip, Inc. Announces Results for Fourth Quarter and Year End 2009

HOUSTON, Feb. 26 /PRNewswire-FirstCall/ -- Dril-Quip, Inc. (NYSE: DRQ) today announced net income of $28.7 million, or $0.72 per diluted share for the three months ended December 31, 2009, versus net income of $25.0 million, or $0.64 per diluted share for the fourth quarter of 2008.  Total revenues increased to $141.3 million for the quarter ended December 31, 2009 from $135.5 million for the same period in 2008. The increase in revenues resulted from increases of $15.6 million in subsea equipment revenues and $0.7 million in service revenues, offset by decreases of $8.2 million in revenues related to offshore rig equipment and $2.3 million in surface equipment revenues.  Operating income was $36.6 million in the fourth quarter of 2009 compared to $33.4 million in the fourth quarter of 2008.

For the twelve months ended December 31, 2009, net income was $105.1 million, or $2.66 per diluted share, compared with net income of $105.6 million, or $2.62 per diluted share, for the same period in 2008.  The full year results for 2009 include a pre-tax charge of $5.2 million related to the recognition of employment contract termination expenses resulting from the death of Gary D. Smith, one of the Company's Co-Chief Executive Officers, during the third quarter of 2009. Revenues for the twelve months ended December 31, 2009 were $540.2 million, compared to revenues of $542.8 million for the same period in 2008. Operating income was $142.0 million for the year ended December 31, 2009 versus $141.7 million during the same period in 2008.

In addition, the Company announced that its backlog at December 31, 2009 was approximately $563 million, compared to its December 31, 2008 backlog of approximately $603 million. The Company expects its earnings per share for the quarter ending March 31, 2010 to approximate $0.62 to $0.72 per share, excluding any unusual or special charges.

Dril-Quip is a leading manufacturer of highly engineered offshore drilling and production equipment, which is well suited for use in deepwater, harsh environment and severe service applications.

Statements contained herein relating to future operations and financial results that are forward looking statements are based upon certain assumptions and analyses made by the management of the Company in light of its experience and perception of historical trends, current conditions, expected future developments and other factors. These statements are subject to risks beyond the Company's control, including, but not limited to, the volatility of oil and natural gas prices and cyclicality of the oil and gas industry, the Company's international operations, operating risks, and other factors detailed in the Company's public filings with the Securities and Exchange Commission.  Investors are cautioned that any such statements are not guarantees of future performance and actual outcomes may vary materially from those indicated.

    
    
                                 Dril-Quip, Inc.
                 Comparative Consolidated Statements of Income
                     (in thousands, except per share amounts)
                                   (Unaudited)
    
                                     Three months ended  Twelve months ended
                                        December 31,        December 31,
                                     -----------------    ---------------- 
                                      2008       2009      2008      2009
                                     ------     ------    ------    ------ 
    
    Revenues                        $135,543  $141,339  $542,771  $540,204
    Cost and expenses:
      Cost of sales                   76,524    82,609   312,299   310,293
      Selling, general and
       administrative                 18,851    14,777    62,390    55,474
      Engineering and product
       development                     6,745     7,318    26,369    27,173
      Special item                         -         -         -     5,224
                                         ---       ---       ---     -----
                                     102,120   104,704   401,058   398,164
                                     -------   -------   -------   -------
    
    Operating income                  33,423    36,635   141,713   142,040
    
    Interest income                      323        97     3,453       507
    Interest expense                     (33)      (59)     (182)     (156)
                                         ---       ---       ---     -----
    Income before income taxes        33,713    36,673   144,984   142,391
    Income tax provision               8,668     7,994    39,399    37,250
                                       -----     -----    ------    ------
    Net income                       $25,045   $28,679  $105,585  $105,141
                                     =======   =======  ========  ========
    
    Diluted earnings per share         $0.64     $0.72     $2.62     $2.66
                                       =====     =====     =====     =====
    
    Weighted average shares
     – diluted                        39,302    39,822    40,292    39,538
                                      ======    ======    ======    ======
    
    Depreciation and amortization     $4,198    $4,652   $16,854   $17,997
                                      ======    ======   =======   =======
    
    Capital expenditures             $10,769    $6,636   $50,134   $44,749
                                     =======    ======   =======   =======
    

SOURCE Dril-Quip, Inc.