Northern Offshore Reports First Quarter 2015 Results
HOUSTON, May 20, 2015 /PRNewswire/ --
Highlights
(All $ in USD)
- Northern Offshore, Ltd. (Oslo Børs: NOF.OL) today reported net income for the three months ended March 31, 2015, of $5.9 million, or $0.04 per diluted share, on revenues of $44.6 million.
- The Company generated adjusted EBITDA of $14.1 million in the first quarter 2015.
- The semisubmersible Energy Driller concluded its three year contract with ONGC on April 18, 2015 and was moved to a stacking location in Bahrain where it will remain while the Company actively pursues marketing opportunities in the Asia Pacific Region.
- The jackup Energy Endeavour concluded its drilling program with Wintershall on May 13, 2015 and has been relocated to Rotterdam, the Netherlands. The Company continues to market the unit for immediate employment.
Management Comment
Gary W. Casswell, Northern Offshore's President and CEO, commented;
"Our first quarter results exceeded our expectations due to the acceleration of the cost savings initiatives implemented by the Company. Both the semisubmersible Energy Driller and jackup Energy Endeavour successfully concluded their drilling programs and are located at their stacking locations.
Following release from its previous contract in Nigeria, the Company made a strategic relocation of the drillship Energy Searcher to the Middle East/Asia Pacific Region to pursue marketing opportunities in those areas while taking advantage of a lower cost layup location.
As we look forward, we will rely heavily on our experienced and dedicated management team to remain focused on cost control and capital discipline while continuing to market our services in a highly competitive environment. "
First Quarter Analysis
Net income for the three months ended March 31, 2015 of $5.9 million, or $0.04 per diluted share, with revenues of $44.6 million compares to net income of $10.0 million, or $0.06 per diluted share, with revenues of $49.4 million for the first quarter of 2014.
Revenues for the three months ended March 31, 2015 were $4.9 million lower than the same period in 2014, primarily related to the floating production facility Northern Producer as the tariff revenue was negatively impacted by a combination of lower production volume and decrease in the tariff rate due to the decline in the price of North Sea Brent. Drilling and production expenses for the three months ended March 31, 2015 were $1.8 million higher as compared to the same period in 2014, primarily due to an increase in operating expenses for the drillship Energy Searcher relating to the completion of its contract offshore Nigeria. Partially offsetting this increase was an overall decrease in operating expenses for the remainder of the fleet primarily due to lower labor, repair and maintenance costs.
First quarter 2015 depreciation, general and administrative expenses, interest expense, and other financial items were comparable to those of the same period in 2014.
Tariff revenues from the floating production facility Northern Producer averaged approximately $39,000 per day in the first quarter of 2015. The company expects pricing levels to remain stable and production to decrease slightly in line with the forecast decline rates.
As of today, the company has an outstanding credit facility balance of $29 million and an unrestricted cash balance of approximately $37 million.
Conference Call Information
Northern Offshore, Ltd. will conduct a teleconference with security analysts at 9 a.m. CT, May 21, 2015, to discuss the company's quarterly results. Individuals wishing to participate in the teleconference should call 1-877-703-6109 (in the U.S.) or +1-857-244-7308 (toll free or outside the U.S.) about five to ten minutes prior to the scheduled start time and refer to participant password 85572639.
The conference call also will be accessible by logging on to the company's website at http://www.northernoffshorelimited.com. After logging on, go to "Investor Relations" and select the conference call webcast.
About the Company
Northern Offshore, Ltd. is a Bermuda holding company which operates offshore oil and gas drilling units and one production vessel in various markets around the world, including the North Sea, the Indian Ocean, and Southeast Asia. The company's fleet consists of four drilling units (a drillship, a semisubmersible and two jackup drilling rigs) and one floating production facility. Additionally, the company has under construction two 350' high specification jackup drilling rigs, with contract delivery in the fourth quarter of 2016 and second quarter of 2017. More information on Northern Offshore, Ltd. may be found by visiting the company's website at http://www.northernoffshorelimited.com.
For further information, please contact:
Paul Ravesies at (713) 739-7686 or via email at [email protected]
This announcement contains statements that reflect the company's expectations or predictions of the future. These forward-looking statements may include comments regarding earnings guidance, capital allocation strategy, the impact of activity levels, business performance, and other market and industry conditions. The company's actual results could differ materially from those reflected in such forward-looking statements. The company disclaims any intention or obligation to revise any forward-looking statements, including financial estimates, whether as a result of new information, future events or otherwise.
| NORTHERN OFFSHORE, LTD. and SUBSIDIARIES |
|||
| Consolidated Statements of Operations |
|||
| (Unaudited) |
|||
| Three Months Ended |
|||
| (Thousands of US Dollars, except per share amounts) |
Q4 2014 |
2015 |
2014 |
| Revenues |
77,767 |
44,570 |
49,432 |
| Operating expenses: |
|||
| Drilling and production |
(52,493) |
(28,782) |
(26,949) |
| Depreciation |
(8,552) |
(8,605) |
(8,297) |
| General & administrative |
(1,360) |
(1,697) |
(2,142) |
| Total operating expenses |
(62,405) |
(39,084) |
(37,388) |
| Operating income |
15,362 |
5,486 |
12,044 |
| Interest expense |
(391) |
(363) |
(426) |
| Amortization of deferred financing fees |
- |
- |
(121) |
| Other financial items |
446 |
483 |
(45) |
| Total other expense |
55 |
120 |
(592) |
| Income before taxes |
15,417 |
5,606 |
11,452 |
| Income taxes benefit / (expense) |
(2,911) |
295 |
(1,449) |
| Net income |
12,506 |
5,901 |
10,003 |
| Earnings per share (US$) |
|||
| Basic |
0.08 |
0.04 |
0.06 |
| Diluted |
0.08 |
0.04 |
0.06 |
| Weighted average common shares (000's) |
|||
| Basic |
159,622 |
161,180 |
159,091 |
| Diluted |
159,622 |
161,180 |
159,093 |
| NORTHERN OFFSHORE, LTD. and SUBSIDIARIES |
||
| Consolidated Balance Sheets |
||
| (Unaudited) |
||
| (Thousands of US Dollars) |
March 31, |
December 31, |
| Current assets |
||
| Cash and cash equivalents |
25,990 |
16,604 |
| Restricted cash |
6,898 |
6,436 |
| Accounts receivable, net |
28,898 |
48,909 |
| Prepaid expenses |
4,023 |
3,425 |
| Deferred mobilization costs |
61 |
368 |
| Deferred insurance premium |
597 |
1,855 |
| Other current assets |
61 |
366 |
| Total current assets |
66,528 |
77,963 |
| Noncurrent assets |
||
| Property, plant & equipment - existing fleet, net |
146,814 |
155,267 |
| Property, plant & equipment - newbuild jackups |
119,270 |
84,924 |
| Noncurrent deposit/escrow account |
12,040 |
12,034 |
| Drydock costs, net of current portion |
803 |
1,085 |
| Other noncurrent assets |
19,240 |
1,154 |
| Total noncurrent assets |
298,167 |
254,464 |
| Total assets |
364,695 |
332,427 |
| Current liabilities |
||
| Accounts payable |
7,012 |
11,973 |
| Accrued expenses |
12,741 |
14,458 |
| Income taxes payable |
1,701 |
2,775 |
| Affiliated debt |
29,000 |
29,000 |
| Total current liabilities |
50,454 |
58,206 |
| Non-current liabilities |
||
| Other long-term liabilities |
81,435 |
47,793 |
| Total liabilities |
131,889 |
105,999 |
| Shareholders' equity |
||
| Share capital |
41,469 |
41,117 |
| Additional paid-in capital |
179,378 |
179,253 |
| Accumulated other comprehensive loss |
(6,691) |
(6,691) |
| Retained earnings |
18,650 |
12,749 |
| Total shareholders' equity |
232,806 |
226,428 |
| Total liabilities and shareholders' equity |
364,695 |
332,427 |
| NORTHERN OFFSHORE, LTD. and SUBSIDIARIES |
||||||
| Consolidated Statements of Cash Flows - (Unaudited) |
||||||
| Three months ended |
||||||
| (Thousands of US Dollars) |
2015 |
2014 |
||||
| Cash flows from operating activities |
||||||
| Net income |
5,901 |
10,003 |
||||
| Adjustments to reconcile net income to net cash provided by operating activities: |
||||||
| Stock-based compensation |
805 |
1,174 |
||||
| Depreciation |
8,605 |
8,297 |
||||
| Amortization of deferred financing fees |
- |
121 |
||||
| Gain on disposal of assets |
- |
(325) |
||||
| Changes in operating assets and working capital |
||||||
| Accounts receivable |
20,011 |
(4,548) |
||||
| Prepaid expenses |
(598) |
253 |
||||
| Deferred mobilization costs |
307 |
(13,829) |
||||
| Other current and noncurrent assets |
(17,513) |
718 |
||||
| Accounts payable |
(3,689) |
1,380 |
||||
| Other accrued liabilities |
(1,716) |
(583) |
||||
| Deferred revenue |
- |
5,785 |
||||
| Income taxes payable |
(1,074) |
450 |
||||
| Net cash provided by operating activities |
11,039 |
8,896 |
||||
| Cash flows from investing activities |
||||||
| Capital expenditures - existing fleet |
(153) |
(529) |
||||
| Capital expenditures - newbuild jackups |
(704) |
(17,997) |
||||
| Changes in restricted cash |
(462) |
- |
||||
| Changes in noncurrent deposit/escrow account |
(6) |
(1,182) |
||||
| Net cash used in investing activities |
(1,325) |
(19,708) |
||||
| Cash flows from financing activities |
||||||
| Proceeds from drawdown of revolver facility |
- |
25,000 |
||||
| Payment for taxes on vested shares |
(328) |
(844) |
||||
| Dividends paid |
- |
(7,956) |
||||
| Net changes in financing activities |
(328) |
16,200 |
||||
| Net changes in cash and cash equivalents |
9,386 |
5,388 |
||||
| Cash and cash equivalents at beginning of period |
16,604 |
19,537 |
||||
| Cash and cash equivalents at end of period |
25,990 |
24,925 |
||||
| Supplemental disclosure of cash flow information |
||||||
| Cash paid during the period for: |
||||||
| Income taxes |
266 |
250 |
||||
| Interest |
86 |
- |
||||
| Significant non-cash transactions during the period for: |
||||||
| Accrued capital expenditures |
33,642 |
2,850 |
||||
| Accrued dividends |
- |
204 |
||||
| NORTHERN OFFSHORE, LTD. and SUBSIDIARIES |
||||||||
| Consolidated Statements of Shareholders' Equity |
||||||||
| (Unaudited) |
||||||||
| Accumulated |
||||||||
| Common |
Additional |
other |
||||||
| shares |
Share |
paid-in |
comprehensive |
Retained |
||||
| (Thousands of US Dollars) |
('000) |
capital |
capital |
loss |
earnings |
Total |
||
| Balance at December 31, 2013 |
163,732 |
40,933 |
175,462 |
(6,691) |
8,665 |
218,369 |
||
| Net income |
- |
- |
- |
- |
10,003 |
10,003 |
||
| Issuance of restricted stock |
(333) |
(83) |
83 |
- |
- |
- |
||
| Payments for taxes on vested shares |
- |
- |
(844) |
- |
- |
(844) |
||
| Stock-based compensation |
- |
- |
1,174 |
- |
- |
1,174 |
||
| Common shares dividends |
- |
- |
- |
- |
(8,160) |
(8,160) |
||
| Balance at March 31, 2014 |
163,399 |
40,850 |
175,875 |
(6,691) |
10,508 |
220,542 |
||
| Balance at December 31, 2014 |
164,470 |
41,117 |
179,253 |
(6,691) |
12,749 |
226,428 |
||
| Net income |
- |
- |
- |
- |
5,901 |
5,901 |
||
| Issuance of restricted stock |
1,407 |
352 |
(352) |
- |
- |
- |
||
| Payments for taxes on vested shares |
- |
- |
(328) |
- |
- |
(328) |
||
| Stock-based compensation |
- |
- |
805 |
- |
- |
805 |
||
| Common shares dividends |
- |
- |
- |
- |
- |
- |
||
| Balance at March 31, 2015 |
165,877 |
41,469 |
179,378 |
(6,691) |
18,650 |
232,806 |
||
| NORTHERN OFFSHORE, LTD. and SUBSIDIARIES |
|||
| Reconciliation of GAAP to Non-GAAP Financial Results |
|||
| (Unaudited) |
|||
| Three Months Ended |
|||
| March 31, |
|||
| (Thousands of US Dollars) |
Q4 2014 |
2015 |
2014 |
| Net income (GAAP) |
12,506 |
5,901 |
10,003 |
| Add Back: |
|||
| Net interest expense |
391 |
363 |
547 |
| Income taxes |
2,911 |
(295) |
1,449 |
| Depreciation |
8,552 |
8,605 |
8,297 |
| Other financial items |
(446) |
(483) |
45 |
| Adjusted EBITDA (Non-GAAP) |
23,914 |
14,091 |
20,341 |
| Adjusted EBITDA is defined as Net Income before Interest, Taxes, Depreciation and Other Financial Items |
| NORTHERN OFFSHORE, LTD. and SUBSIDIARIES |
||||
| Operating Statistics |
||||
| (Unaudited) |
||||
| Three Months Ended |
||||
| March 31, |
||||
| Q4 2014 |
2015 |
2014 |
||
| Jackups (2) |
||||
| Average rig utilization |
100% |
100% |
100% |
|
| Operating days |
184 |
180 |
180 |
|
| Average revenue per day |
146,904 |
147,297 |
139,435 |
|
| Drillship (1) |
||||
| Average rig utilization |
100% |
2% |
0% |
|
| Operating days |
92 |
2 |
0 |
|
| Average revenue per day |
323,350 |
20 |
0 |
|
| Semisubmersible (1) |
||||
| Average rig utilization |
100% |
100% |
100% |
|
| Operating days |
92 |
90 |
90 |
|
| Average revenue per day |
166,123 |
159,724 |
172,416 |
|
| Total Drilling Rigs (4) |
||||
| Average rig utilization |
100% |
76% |
75% |
|
| Operating days |
368 |
272 |
270 |
|
| Average revenue per day |
195,820 |
150,475 |
150,536 |
|
| Floating Production Facility (1) |
||||
| Days in period |
92 |
90 |
90 |
|
| Production days |
92 |
90 |
90 |
|
| Average bpd |
11,665 |
10,430 |
16,009 |
|
| Average tariff revenue per day |
60,556 |
38,974 |
96,057 |
|
| Average other revenue per day |
1,451 |
1,478 |
1,579 |
|
| Total average revenue per day |
62,007 |
40,452 |
97,636 |
|
| Note 1: Operating days represent actual days under contract. |
||||
| Note 2: Costs which are reimbursed by the client are included in the average revenue per day calculation. |
SOURCE Northern Offshore, Ltd.
Related Links
http://www.northernoffshorelimited.com
WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?
Newsrooms &
Influencers
Digital Media
Outlets
Journalists
Opted In
Share this article