Northern Offshore Reports First Quarter 2013 Results

HOUSTON, May 15, 2013 /PRNewswire/ --

Highlights
(All $ in USD)

  • Northern Offshore, Ltd. (Oslo Bors: NOF.OL) today reported net income for the three months ended March 31, 2013 of $1.1 million, or $0.01 per diluted share, on revenues of $41.4 million
  • The company generated $9.8 million of first quarter EBITDA.
  • The positive net cash balance stands at $18 million.
  • The company's directors have declared a dividend of $0.05 per share, or approximately $8.2 million.

Management Comment

Gary W. Casswell, Northern Offshore's president and CEO, commented, "Earnings for the quarter were slightly less than we expected because of approximately 20 days of downtime for the Energy Driller due to unscheduled maintenance on one of the pontoons.  We are also expecting a flat second quarter due primarily to a transition of the Energy Endeavour back to operations in the UK and the Energy Searcher remaining idle.  However, we still anticipate positive cash flow for the next quarter, as well as the second half of 2013, and expect to maintain the dividend distributions."

First Quarter Analysis

Net income for the three months ended March 31, 2013 of $1.1 million, or $0.01 per diluted share, on revenues of $41.4 million compares to a net loss of $14.1 million, or $0.09 per diluted share, for the first quarter of 2012, on revenues of $28.2 million.

Revenues for the three months ending March 31, 2013 were $13.2 million higher than the same period in 2012, primarily due to higher utilization of the semisubmersible Energy Driller and jackup Energy Enhancer, and higher dayrates for the jackup Energy Endeavour.  Partially offsetting these increases was a decrease in dayrate revenues for the drillship Energy Searcher due to lower utilization as compared to the same period last year.

Tariff revenues from the floating production facility Northern Producer averaged approximately $110,000 per day in the first quarter of 2013.  The company expects pricing levels to remain stable and production to decline slightly in the near term.

Drilling and production expenses for the three months ending March 31, 2013 were $5.1 million lower as compared to the same period in 2012, primarily due to a decrease in operating expenses for the jackup Energy Exerter, as the rig was sold in October 2012.  This disposition also accounted for most of the $1.5 million decrease in depreciation expense for the current quarter as compared to the first quarter of the prior year.  First quarter 2013 general and administrative expenses, interest expense, amortization of financing fees and other financial items were comparable to those of the same period in 2012.

As of May 14, 2013, the company had an outstanding credit facility balance of $22 million and a cash balance of approximately $40 million.

The company's directors have declared a dividend of $0.05 per share, or approximately $8.2 million.  Shareholders of record with the VPS on May 31, 2013 will be entitled to receive the dividend, which will be paid on or around June 14, 2013.  The shares of the company will be trading ex-dividend from May 29, 2013.

Conference Call Information

Northern Offshore, Ltd. will conduct a teleconference with security analysts at 9 a.m. CT, May 16, 2013 to discuss the company's quarterly results.  Individuals wishing to participate in the teleconference should call (800) 884-5695 (in the U.S.) or (617) 786-2960 (outside the U.S.) about five to ten minutes prior to the scheduled start time and refer to participant password 79956446.

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.  More information on Northern Offshore, Ltd. may be found by visiting the company's website at http://www.northernoffshorelimited.com.

This announcement contains statements that reflect the company's expectations or predictions of the future. These statements are forward-looking statements.  These forward-looking statements may include statements 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.  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 regulatory filings.  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.   

For further information, please contact:
Brian Hefty at (713) 739-7686,
or via email at brian.hefty@northernoffshoreltd.com

NORTHERN OFFSHORE, LTD. and SUBSIDIARIES

Consolidated Statements of Operations

(Unaudited)







 Three Months Ended

March 31,  

(Thousands of US Dollars, except per share amounts)

Q4 2012

2013

2012

Revenues

48,812

41,413

28,238

Operating expenses:




Drilling and production

(31,458)

(30,079)

(35,142)

Depreciation

(7,767)

(7,937)

(9,398)

General & administrative

(1,083)

(2,011)

(1,911)

Gain on disposal of assets

7,574

-

-

Total operating expenses

(32,734)

(40,027)

(46,451)

Operating income/(loss)

16,078

1,386

(18,213)

Interest expense

(501)

(395)

(494)

Amortization of deferred financing fees

(123)

(121)

(138)

Other financial items

(193)

469

(373)

Total other expense

(817)

(47)

(1,005)

Income/(loss) before taxes

15,261

1,339

(19,218)

Income taxes - benefit/(expense) 

(2,098)

(275)

5,075

Net income/(loss)

13,163

1,064

(14,143)





Earnings per share (US$)




     Basic

0.08

0.01

(0.09)

     Diluted

0.08

0.01

(0.09)





Weighted average common shares (000's)




     Basic

156,134

157,060

155,689

     Diluted

156,134

157,217

155,689

 

NORTHERN OFFSHORE, LTD. and SUBSIDIARIES

Consolidated Balance Sheets

(Unaudited)




(Thousands of US Dollars)

March 31,

2013

December 31, 

 2012

Current assets 



Cash and cash equivalents

22,034

26,504

Restricted cash 

150

-

Accounts receivable, net

25,520

29,386

Prepaid expenses 

3,452

4,099

Deferred mobilization costs 

1,719

2,209

Deferred insurance premium

1,516

1,869

Other current assets

1,711

1,711

Total current assets

56,102

65,778

Noncurrent assets 



Property, plant & equipment, net

197,326

201,077

Restricted cash, net of current portion 

5,436

5,436

Noncurrent deposit/escrow account

7,098

5,198

Deferred mobilization costs, net of current portion

1,289

1,596

Drydock costs, net of current portion

4,534

5,093

Other noncurrent assets 

1,322

1,748

Total noncurrent assets

217,005

220,148

Total assets

273,107

285,926

Current liabilities



Accounts payable

11,604

16,760

Accrued expenses

9,368

9,748

Income taxes payable

595

933

Current debt

22,000

22,000

Deferred revenue

1,031

2,062

Total current liabilities

44,598

51,503

Shareholders' equity



Share capital

40,888

40,122

Additional paid-in capital

171,415

170,985

Accumulated other comprehensive loss

(6,691)

(6,691)

Retained earnings

22,897

30,007

Total shareholders' equity

228,509

234,423

Total liabilities and shareholders' equity  

273,107

285,926

 

NORTHERN OFFSHORE, LTD. and SUBSIDIARIES

Consolidated Statements of Cash Flows - (Unaudited)












Three months ended 

 March 31,

(Thousands of US Dollars)




2013

2012

Cash flows from operating activities





Net income/(loss)




1,064

(14,143)

Adjustments to reconcile net income to net cash




  provided by/(used in) operating activities:





Stock-based compensation 




1,470

999

Depreciation




7,937

9,398

Amortization of deferred financing fees



121

138

Gain on disposal of assets



(29)

(22)








Changes in operating assets and working capital




Accounts receivable



3,866

17,441

Prepaid expenses                          



647

(831)

Income taxes receivable



-

(3,625)

Deferred mobilization costs




797

(1,970)

Other current and noncurrent assets



932

(1,706)

Accounts payable



(6,839)

(5,594)

Other accrued liabilities



(568)

(2,344)

Deferred revenue



(1,031)

(4,813)

Income taxes payable



(338)

(2,926)

Net cash provided by/(used in) operating activities


8,029

(9,998)








Cash flows from investing activities





Capital expenditures




(2,189)

(1,402)

Changes in restricted cash




(150)

2,604

Changes in noncurrent deposit/escrow account



(1,900)

(915)

Net cash provided by/(used in) investing activities


(4,239)

287








Cash flows from financing activities





Proceeds from drawdown of revolver facility



-

14,564

Payment for taxes on vested shares



(274)

(563)

Dividends paid




(7,986)

(4,753)

Net cash provided by/(used in) financing activities


(8,260)

9,248








Net changes in cash and cash equivalents



(4,470)

(463)

Cash and cash equivalents at beginning of period



26,504

10,601

Cash and cash equivalents at end of period



22,034

10,138








Supplemental disclosure of cash flow information




Cash paid during the period for:






    Income taxes




87

1,126








Significant non-cash transactions during the period for:




Accrued capital expenditures




1,968

1,279

Accrued dividends




188

60

 

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, 2011

158,184

39,546

168,583

(6,691)

34,855

236,293










Net loss



-

-

-

-

(14,143)

(14,143)

Issuance of restricted stock


2,277

569

(569)

-

-

-

Payments for taxes on vested shares

-

-

(563)

-

-

(563)

Stock-based compensation 


-

-

999

-

-

999

Common shares dividends


-

-

-

-

(4,813)

(4,813)

Balance at March 31, 2012

160,461

40,115

168,450

(6,691)

15,899

217,773










Balance at December 31, 2012

160,488

40,122

170,985

(6,691)

30,007

234,423










Net income



-

-

-

-

1,064

1,064

Issuance of restricted stock


3,064

766

(766)

-

-

-

Payments for taxes on vested shares

-

-

(274)

-

-

(274)

Stock-based compensation 


-

-

1,470

-

-

1,470

Common shares dividends


-

-

-

-

(8,174)

(8,174)

Balance at March 31, 2013

163,552

40,888

171,415

(6,691)

22,897

228,509

 

NORTHERN OFFSHORE, LTD. and SUBSIDIARIES

Reconciliation of GAAP to Non-GAAP Financial Results

(Unaudited)







Three Months Ended



March 31,

(Thousands of US Dollars)

Q4 2012

2013

2012





Net income/(loss) (GAAP)

13,163

1,064

(14,143)





Add Back:




Net interest expense

624

516

632

Income taxes

2,098

275

(5,075)

Depreciation

7,767

7,937

9,398





EBITDA (Non-GAAP)

23,652

9,792

(9,188)









EBITDA is defined as Net Income/(Loss) before Interest, Taxes and Depreciation

 

NORTHERN OFFSHORE, LTD. and SUBSIDIARIES

Operating Statistics

(Unaudited)









 Three Months Ended 




 March 31, 


Q4 2012


2013

2012






Jackups (2)










Average rig utilization 

100%


100%

58%

Operating days 

184


180

106

Average revenue per day 

103,195


105,545

63,477






Drillship (1)










Average rig utilization 

0%


0%

45%

Operating days

0


0

41

Average revenue per day 

0


0

309,530






Semisubmersible (1)










Average rig utilization 

100%


100%

0%

Operating days

92


90

0

Average revenue per day

172,108


138,013

0






Total Drilling Rigs (4)










Average rig utilization 

75%


75%

40%

Operating days 

276


270

147

Average revenue per day 

126,456


116,368

132,104






Floating Production  Facility (1)










Days in period 

92


90

91

Production days

92


90

91

Average bpd

24,965


18,273

15,919

Average tariff revenue per day

149,789


109,636

95,515

Average other revenue per day 

1,408


1,406

1,393

Total average revenue per day 

151,197


111,042

96,908











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.  






Note 3: Energy Exerter is excluded from Q1 2012 and Q4 2012 calculation for the jackup fleet.

SOURCE Northern Offshore, Ltd.



RELATED LINKS
http://www.northernoffshorelimited.com

More by this Source

Best of Content We Love 2014 


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

 

PR Newswire Membership

Fill out a PR Newswire membership form or contact us at (888) 776-0942.

Learn about PR Newswire services

Request more information about PR Newswire products and services or call us at (888) 776-0942.