Newpark Resources Reports Net Income Of $0.18 Per Diluted Share For The First Quarter 2013

Company announces new $50 million share repurchase program

Apr 25, 2013, 16:10 ET from Newpark Resources, Inc.

THE WOODLANDS, Texas, April 25, 2013 /PRNewswire/ -- Newpark Resources, Inc. (NYSE: NR) today announced results for its first quarter ended March 31, 2013.  Total revenues for the first quarter of 2013 increased 7.7% to $283 million compared to $262 million in the first quarter of 2012.  Net income for the first quarter of 2013 increased 11.1% to $17.4 million, or $0.18 per diluted share, from $15.6 million, or $0.16 per diluted share, in the first quarter of 2012.

Paul Howes, Newpark's President and Chief Executive Officer, stated, "We are pleased with the strong start to 2013, achieving another record level of revenue in the first quarter.  Revenues from our fluids segment grew 13% worldwide over last year's first quarter.  North American fluids revenues increased 10% over last year's first quarter to $178 million, despite an 11% reduction in rig count, benefitting from our December 2012 acquisition of Alliance Drilling Fluids.   International revenues from the fluids business were up 21% year-over-year, reflecting strong gains across all regions. 

"Revenues in our mats segment declined in the first quarter, as we allocated the majority of the quarter's composite mat production toward the expansion of our rental fleet, in preparation for the launch of our new spill containment system," added Howes. "Meanwhile our Environmental Service business continued to deliver consistent results, benefitting from the strengthening activity levels in the Gulf of Mexico." 

SEGMENT RESULTS The Fluids Systems and Engineering segment generated revenues of $247.3 million in the first quarter of 2013 compared to $218.5 million in the first quarter of 2012, a 13% increase.  Segment operating income rose 62% to $22.6 million (9.1% operating margin) in the first quarter of 2013 compared to $14.0 million (6.4% operating margin) in the first quarter of 2012. 

The Mats and Integrated Services segment generated revenues of $20.6 million in the first quarter of 2013 compared to $30.5 million in the first quarter of 2012, a 33% decrease.  Segment operating income declined 41% to $8.5 million (41.2% operating margin) in the first quarter of 2013 compared to $14.3 million (47.0% operating margin) in the first quarter of 2012. 

The Environmental Services segment generated revenues of $14.6 million in the first quarter of 2013 compared to $13.3 million in the first quarter of 2012, a 10% increase.  Segment operating income was $3.5 million (24.0% operating margin) in the first quarter of 2013 compared to $3.6 million (26.9% operating margin) in the first quarter of 2012.

SHARE REPURCHASE PROGRAM The Company's Board of Directors has authorized a second $50 million share repurchase program, following the $50 million repurchase program completed in the fourth quarter of 2012.  Purchases under the new program will be funded with a combination of cash generated from operations and borrowings under the Company's revolving credit facility, and the repurchase program has no specific term.  The Company may repurchase shares in the open market or as otherwise determined by management, subject to market conditions, business opportunities and other factors.  The Company's management has been authorized to establish trading plans under Rule 10b5-1 of the Securities Exchange Act of 1934, as part of the share repurchase program.

CONFERENCE CALL Newpark has scheduled a conference call to discuss first quarter 2013 results, which will be broadcast live over the Internet, on Friday, April 26, 2013 at 10:00 a.m. Eastern Time / 9:00 a.m. Central Time.  To participate in the call, dial 480-629-9835 and ask for the Newpark Resources conference call at least 10 minutes prior to the start time, or access it live over the Internet at www.newpark.com.  For those who cannot listen to the live call, a replay will be available through May 10, 2013 and may be accessed by dialing (303) 590-3030 and using pass code 4610050#.  Also, an archive of the webcast will be available shortly after the call at www.newpark.com for 90 days.

Newpark Resources, Inc. is a worldwide provider of drilling fluids, temporary worksites and access roads for oilfield and other commercial markets, and environmental waste treatment solutions.  For more information, visit our website at www.newpark.com.

This news release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act that are based on management's current expectations, estimates and projections. All statements that address expectations or projections about the future, including Newpark's strategy for growth, product development, market position, expected expenditures and financial results are forward-looking statements. Some of the forward-looking statements may be identified by words like "expects," "anticipates," "plans," "intends," "projects," "indicates," and similar expressions. These statements are not guarantees of future performance and involve a number of risks, uncertainties and assumptions. Many factors, including those discussed more fully elsewhere in this release and in documents filed with the Securities and Exchange Commission by Newpark, particularly its Annual Report on Form 10-K for the year ended December 31, 2012, as well as others, could cause results to differ materially from those stated. These risk factors include, but are not limited to, our ability to execute our business strategy and make successful business acquisitions and capital investments, our customers' activity levels in exploration and drilling, operating hazards inherent  in the oil and natural gas industry, particularly offshore, our international operations, the availability of raw materials and skilled personnel, our customer concentration and cyclical nature of our industry, our market competition, the cost and continued availability of borrowed funds, legal and regulatory matters, including environmental regulations, inherent limitations in insurance coverage, potential impairments of long-lived intangible assets, technological developments in our industry, and the impact of severe weather, particularly in the U.S. Gulf Coast. Newpark's filings with the Securities and Exchange Commission can be obtained at no charge at www.sec.gov, as well as through our website at www.newpark.com.

Contacts:

Gregg Piontek, VP & CFO Newpark Resources, Inc. 281-362-6800

 

Ken Dennard, Managing Partner Karen Roan, SVP Dennard ▪ Lascar Associates 713-529-6600

 

Newpark Resources, Inc.

Consolidated Statements of Operations

(Unaudited)

Three Months Ended

March 31,

December 31,

March 31,

(In thousands, except per share data)

2013

2012

2012

Revenues

$  282,518

$        270,328

$  262,336

Cost of revenues

230,406

219,817

214,902

Selling, general and administrative expenses

24,182

24,217

21,313

Other operating income, net

(439)

43

(14)

Operating income 

28,369

26,251

26,135

Foreign currency exchange (gain) loss 

(368)

333

(230)

Interest expense, net

2,520

2,403

2,368

Income from operations before income taxes

26,217

23,515

23,997

Provision for income taxes

8,842

12,322

8,363

Net income 

$    17,375

$          11,193

$    15,634

Income per common share -basic:

$        0.21

$              0.13

$        0.17

Income per common share -diluted:

$        0.18

$              0.12

$        0.16

Calculation of Diluted EPS:

Net income 

$    17,375

$          11,193

$    15,634

Assumed conversion of Senior Notes 

1,266

927

1,257

Adjusted net income 

$    18,641

$          12,120

$    16,891

Weighted average number of common shares outstanding-basic

84,100

84,602

90,473

Add:  Dilutive effect of  stock options and 

           restricted stock awards

1,572

903

1,198

           Dilutive effect of Senior Notes 

15,682

15,682

15,682

Diluted weighted average number of common shares outstanding

101,354

101,187

107,353

Income per common share - diluted

$        0.18

$              0.12

$        0.16

 

Newpark Resources, Inc.

Operating Segment Results

(Unaudited)

Three Months Ended

March 31,

December 31,

March 31,

(In thousands)

2013

2012

2012

Revenues

Fluids systems and engineering

$  247,339

$        229,329

$  218,496

Mats and integrated services

20,584

26,612

30,533

Environmental services

14,595

14,387

13,307

Total revenues

$  282,518

$        270,328

$  262,336

Operating income (loss) 

Fluids systems and engineering

$    22,622

$          17,714

$    13,995

Mats and integrated services

8,480

10,845

14,339

Environmental services

3,508

3,444

3,575

Corporate office

(6,241)

(5,752)

(5,774)

Total operating income 

$    28,369

$          26,251

$    26,135

Segment operating margin

Fluids systems and engineering

9.1%

7.7%

6.4%

Mats and integrated services

41.2%

40.8%

47.0%

Environmental services

24.0%

23.9%

26.9%

 

Newpark Resources, Inc.

Consolidated Balance Sheets

(Unaudited)

March 31,

December 31,

(In thousands, except share data)

2013

2012

ASSETS

Cash and cash equivalents

$      41,710

$          46,846

Receivables, net

343,850

323,439

Inventories

210,264

209,734

Deferred tax asset

11,440

11,596

Prepaid expenses and other current assets

14,491

12,441

Total current assets

621,755

604,056

Property, plant and equipment, net 

264,399

253,990

Goodwill

88,666

87,388

Other intangible assets, net 

36,310

41,018

Other assets

8,062

8,089

Total assets

$ 1,019,192

$        994,541

LIABILITIES AND STOCKHOLDERS' EQUITY

Short-term debt

$        8,990

$            2,599

Accounts payable

121,356

114,377

Accrued liabilities

45,136

42,620

Total current liabilities

175,482

159,596

Long-term debt, less current portion

242,807

256,832

Deferred tax liability

46,523

46,348

Other noncurrent liabilities

20,573

18,187

Total liabilities

485,385

480,963

Commitments and contingencies

Common stock, $0.01 par value, 200,000,000 shares authorized 

and 96,224,385 and 95,733,677 shares issued, respectively

962

957

Paid-in capital

490,297

484,962

Accumulated other comprehensive loss 

(3,498)

(734)

Retained earnings 

112,390

95,015

Treasury stock, at cost; 10,073,767 and 10,115,951 shares, respectively 

(66,344)

(66,622)

Total stockholders' equity

533,807

513,578

Total liabilities and stockholders' equity

$ 1,019,192

$        994,541

 

Newpark Resources, Inc.

Consolidated Statements of Cash Flows

(Unaudited)

Three Months Ended March 31,

(In thousands)

2013

2012

Cash flows from operating activities:

Net income 

$ 17,375

$ 15,634

Adjustments to reconcile net income to net cash provided by operations:

Depreciation and amortization

10,954

8,018

Stock-based compensation expense

1,973

1,383

Provision for deferred income taxes

534

81

Net provision for doubtful accounts

208

414

 (Gain) loss on sale of assets

(99)

244

Change in assets and liabilities:

Increase in receivables

(20,969)

(24,439)

Increase in inventories

(1,280)

(12,144)

Increase in other assets

(2,382)

(1,755)

Increase in accounts payable

4,179

9,008

Increase (decrease) in accrued liabilities and other

4,747

(2,852)

Net cash provided by (used in) operating activities

15,240

(6,408)

Cash flows from investing activities:

Capital expenditures

(16,127)

(17,302)

Proceeds from sale of property, plant and equipment

213

8

Net cash used in investing activities

(15,914)

(17,294)

Cash flows from financing activities:

Borrowings on lines of credit

71,102

85,951

Payments on lines of credit

(78,748)

(50,632)

Proceeds from employee stock plans

3,808

234

Purchase of treasury stock

-

(7,598)

Other financing activities

(38)

10

Net cash (used in) provided by financing activities

(3,876)

27,965

Effect of exchange rate changes on cash

(586)

859

Net (decrease) increase in cash and cash equivalents

(5,136)

5,122

Cash and cash equivalents at beginning of year

46,846

25,247

Cash and cash equivalents at end of period

$ 41,710

$ 30,369

SOURCE Newpark Resources, Inc.



RELATED LINKS

http://www.newpark.com