Hercules Offshore, Inc. Announces Fourth Quarter and Full Year 2015 Results
HOUSTON, March 30, 2016 /PRNewswire/ -- Hercules Offshore, Inc. (Nasdaq: HERO) today reported a net loss of $361.8 million, or $2.24 per diluted share, on revenue of $27.5 million for the period from October 1, 2015 to November 6, 2015 for the Predecessor Company, and a net loss of $23.7 million, or $1.18 per diluted share, on revenue of $32.4 million for the period from November 6, 2015 to December 31, 2015 for the Successor Company. Upon emergence from Chapter 11 bankruptcy on November 6, 2015, Hercules adopted fresh start accounting, which resulted in the Company becoming a new entity for financial reporting purposes. References to "Successor" relate to the financial position of the reorganized Hercules as of and subsequent to November 6, 2015. References to "Predecessor" refer to the financial position of Hercules as of and prior to November 6, 2015 and the results of operations through November 6, 2015. As a result of the application of fresh start accounting and the effects of the implementation of the Plan of Reorganization, the financial statements on or after November 6, 2015 are not comparable with the financial statements prior to that date.
As outlined in the Reconciliation of GAAP to Non-GAAP Financial Measures, Predecessor results for the period from October 1, 2015 to November 6, 2015 include a net charge of approximately $345.6 million, or $2.14 per diluted share, consisting primarily of a $342.7 million charge for reorganization items. Successor results for the period from November 6, 2015 to December 31, 2015 include a charge for reorganization items of $1.3 million, or $0.06 per diluted share. For the fourth quarter 2014, the Predecessor reported a net loss of $154.1 million, or $0.96 per diluted share, on revenue of $178.7 million. Predecessor results for the fourth quarter 2014 include a non-cash impairment charge of property and equipment for $117.0 million, or $0.73 per diluted share.
For the period from January 1, 2015 to November 6, 2015, the Predecessor reported a net loss of $602.5 million, or $3.73 per diluted share, on revenue of $303.2 million, and a net loss of $23.7 million, or $1.18 per diluted share, on revenue of $32.4 million for the period from November 6, 2015 to December 31, 2015 for the Successor. For the twelve month period ending December 31, 2014, the Predecessor reported a net loss of $216.1 million, or $1.35 per diluted share, on revenue of $900.3 million. As outlined in the Reconciliation of GAAP to Non-GAAP Financial Measures, Predecessor results for the period from January 1, 2015 to November 6, 2015 include a net charge of approximately $384.3 million, or $2.38 per diluted share, primarily related to reorganization, restructuring and financing items. Predecessor results for the twelve month period ending December 31, 2014 include a net charge of approximately $196.8 million, or $1.23 per diluted share, consisting of a $199.5 million non-cash impairment charge of property and equipment, a $22.6 million net gain on the sale of cold stacked drilling rigs, and a $19.9 million charge related to retirement of our 7.125% senior secured notes and issuance of our 6.75% senior notes.
John T. Rynd, Chief Executive Officer and President of Hercules Offshore stated, "We closed out 2015 with the drilling industry at its weakest point in over 30 years, driven by the sharp decline in the price of crude oil. Both our rig and liftboat segments in all regions have been negatively impacted. In an effort to realign our cost structure to better reflect the weak environment, we have made significant reductions to our organization and capital spending programs, and will continue to be vigilant with our cost curtailment efforts. As previously disclosed, we are also working diligently with our Board of Directors and advisors on reviewing our strategic alternatives to maximize the value of the Company.
"Looking into 2016 and beyond, we do not expect business conditions to rebound without a material and sustained rally in oil prices. The duration of this low commodity price environment is uncertain, which places greater emphasis on liquidity and drove us to proactively restructure our balance sheet last year. We emerged from our restructuring process with significantly less debt and over $500 million in cash, including $200 million reserved for the final shipyard payment on our newbuild rig the Hercules Highlander. Construction of the Hercules Highlander is progressing as scheduled, with delivery expected during the second quarter 2016. We are working closely with our customer, Maersk Oil & Gas, and the shipyard to ensure timely delivery and acceptance of the rig prior to its departure to the U.K. North Sea, where it will commence on its five-year contract."
Domestic Offshore
Revenue generated from Domestic Offshore by the Predecessor for the period from October 1, 2015 to November 6, 2015 was $10.3 million, and $9.9 million for the period from November 6, 2015 to December 31, 2015 for the Successor. Fourth quarter 2014 Predecessor revenue was $90.2 million. The 78% decrease in revenue was driven largely by lower dayrates and utilization on a reduced rig fleet. Operating expense reported by the Predecessor for the period from October 1, 2015 to November 6, 2015 was $5.4 million and $9.0 million for the period from November 6, 2015 to December 31, 2015 for the Successor. Fourth quarter 2014 Predecessor operating expense was $59.3 million. The 76% decline in operating expense is largely attributable to a reduction in the number of marketed rigs in operation. Domestic Offshore reported nearly breakeven operating income by the Predecessor for the period from October 1, 2015 to November 6, 2015 and an operating loss of $0.6 million for the period from November 6, 2015 to December 31, 2015 for the Successor. Fourth quarter 2014 Predecessor reported an operating loss of $104.2 million for Domestic Offshore, including a non-cash asset impairment charge of property and equipment for $117.0 million.
International Offshore
Revenue generated from International Offshore by the Predecessor for the period from October 1, 2015 to November 6, 2015 was $12.4 million and $17.3 million for the period from November 6, 2015 to December 31, 2015 for the Successor. Fourth quarter 2014 Predecessor revenue was $64.6 million. The 54% decrease in revenue was primarily due to lower contracted dayrates for the rigs working for Saudi Aramco and idle time on the Hercules 208, Hercules 267 and Hercules Resilience, partially offset by full utilization on the Hercules 260. Operating expense reported by the Predecessor for the period from October 1, 2015 to November 6, 2015 was $13.3 million and $14.4 million for the period from November 6, 2015 to December 31, 2015 for the Successor. Fourth quarter 2014 Predecessor operating expense was $54.0 million. The 49% decline in operating expense was primarily driven by cost reduction measures on the idle rigs as well as higher fourth quarter 2014 expense related to the mobilization cost of the Hercules Triumph to the North Sea. International Offshore reported an operating loss of $10.3 million by the Predecessor for the period from October 1, 2015 to November 6, 2015 and an operating loss of $1.6 million for the period from November 6, 2015 to December 31, 2015 for the Successor. Fourth quarter 2014 Predecessor reported an operating loss of $11.0 million for International Offshore.
International Liftboats
Revenue generated from International Liftboats by the Predecessor for the period from October 1, 2015 to November 6, 2015 was $4.8 million and $5.3 million for the period from November 6, 2015 to December 31, 2015 for the Successor. Fourth quarter 2014 Predecessor revenue was $23.8 million. The 58% decrease in revenue was driven primarily by lower dayrates and utilization. Operating expense reported by the Predecessor for the period from October 1, 2015 to November 6, 2015 was $3.8 million and $6.3 million for the period from November 6, 2015 to December 31, 2015 for the Successor. Fourth quarter 2014 Predecessor operating expense was $16.1 million. The 38% decline in operating expense reflects our cost reduction measures and lower activity levels. International Liftboats reported an operating loss of $1.4 million by the Predecessor for the period from October 1, 2015 to November 6, 2015 and an operating loss of $3.2 million for the period from November 6, 2015 to December 31, 2015 for the Successor. Fourth quarter 2014 Predecessor reported operating income of $0.9 million for International Liftboats.
Reorganization Items
For the period from October 1, 2015 to November 6, 2015, the Predecessor incurred $342.7 million of Reorganization Items, consisting of a $1.0 billion non-cash adjustment of assets due to the application of fresh start accounting, a $686.6 million non-cash gain on the settlement of liabilities subject to compromise, and $10.0 million of other items related to the reorganization, principally professional fees. For the period from November 6, 2015 to December 31, 2015, the Successor incurred $1.3 million of Reorganization Items, primarily for professional fees.
Costs incurred associated with our financing and restructuring activities consisted of the following (in thousands):
| Successor |
Predecessor |
Successor |
Predecessor |
|||||||
| Period from |
Period from |
Period from |
Period from |
|||||||
| Reorganization Items: |
||||||||||
| Non-cash net loss due to fresh start accounting adjustments |
$ - |
$ 1,019,255 |
$ - |
$ 1,019,255 |
||||||
| Non-cash gain on settlement of liabilities subject to compromise (debt forgiveness) |
- |
(686,559) |
- |
(686,559) |
||||||
| Non-cash charge related to write-off of unamortized debt issuance costs |
- |
- |
- |
11,535 |
||||||
| Professional fees |
1,330 |
10,045 |
1,330 |
12,819 |
||||||
| Total Reorganization Items |
$ 1,330 |
$ 342,741 |
$ 1,330 |
$ 357,050 |
||||||
| Professional fees related to the Reorganization: |
||||||||||
| Costs incurred prior to Bankruptcy Petition (General and Administrative Expense) |
$ - |
$ - |
$ - |
$ 18,879 |
||||||
| Costs incurred post Bankruptcy Petition (Reorganization Items) |
1,330 |
10,045 |
1,330 |
12,819 |
||||||
| Total Professional fees related to Reorganization |
$ 1,330 |
$ 10,045 |
$ 1,330 |
$ 31,698 |
Non-GAAP
References in the Selected Financial and Operating Data tables to the change and the percentage change combine the Successor Company and Predecessor Company results for the quarter and year ended December 31, 2015 in order to provide comparability of such information to the quarter and year ended December 31, 2014. While this combined presentation is a non-GAAP presentation for which there is no comparable GAAP measure, management believes that providing this financial information is the most relevant and useful method for making comparisons to the quarter and year ended December 31, 2014.
Certain non-GAAP performance measures and corresponding reconciliations to GAAP financial measures for the Company have been provided for additional meaningful information. Generally, a non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with generally accepted accounting principles. In order to fully assess the financial operating results, management believes that the adjusted net income figures included in this release are appropriate measures of the continuing and normal operations of the Company. However, these measures should be considered in addition to, and not as a substitute for, or superior to, revenue, net income, operating income, cash flows from operations, or other measures of financial performance prepared in accordance with GAAP. The non-GAAP measures included in this press release have been reconciled to the nearest GAAP measure in the tables that follow the financial statements. Please see the attached Reconciliation of GAAP to Non-GAAP Financial Measures for a complete description of the adjustments made to Revenue, Operating Income, Net Income and Diluted Income per Share.
Conference Call Information
Hercules Offshore will conduct a conference call at 10:00 a.m. CT (11:00 a.m. ET) on March 31, 2016, to discuss its fourth quarter and full year 2015 financial results. To participate in the call, dial +1 (855) 865-4806 (Domestic) or +1 (262) 912-6154 (International) and reference access code 75252935 approximately 10 minutes prior to the start of the call. The conference call will also be broadcast live via the Internet at http://www.herculesoffshore.com.
A replay of the conference call will be available by telephone on March 31, 2016, beginning at 1:00 p.m. CT (2:00 p.m. ET), through April 7, 2016. The phone number for the conference call replay is +1 (855) 859-2056 (Domestic) or +1 (404) 537-3406 (International) with access code 75252935. Additionally, the recorded conference call will be accessible through our website at http://www.herculesoffshore.com for 7 days after the conference call.
About Hercules Offshore, Inc.
Headquartered in Houston, Hercules Offshore, Inc. operates a fleet of 27 jackup rigs, including one rig under construction, and 19 liftboats. The Company offers a range of services to oil and gas producers to meet their needs during drilling, well service, platform inspection, maintenance, and decommissioning operations in several key shallow water provinces around the world. For more information, please visit our website at http://www.herculesoffshore.com.
The news release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Such statements are subject to a number of risks, uncertainties and assumptions, including the factors described in Hercules Offshore's most recent periodic reports and other documents filed with the Securities and Exchange Commission, which are available free of charge at the SEC's website at http://www.sec.gov or the Company's website at http://www.herculesoffshore.com. Hercules Offshore cautions you that forward-looking statements are not guarantees of future performance and that actual results or developments may differ materially from those projected or implied in these statements.
| HERCULES OFFSHORE, INC. AND SUBSIDIARIES |
|||||||
| CONSOLIDATED BALANCE SHEETS |
|||||||
| (In thousands) |
|||||||
| Successor |
Predecessor |
||||||
| December 31, |
December 31, |
||||||
| 2015 |
2014 |
||||||
| (Unaudited) |
|||||||
| ASSETS |
|||||||
| Current Assets: |
|||||||
| Cash and Cash Equivalents |
$ 330,780 |
$ 207,937 |
|||||
| Accounts Receivable, Net |
63,668 |
166,359 |
|||||
| Prepaids |
11,740 |
19,585 |
|||||
| Current Deferred Tax Asset |
- |
4,461 |
|||||
| Other |
4,015 |
5,955 |
|||||
| 410,203 |
404,297 |
||||||
| Property and Equipment, Net |
465,497 |
1,574,749 |
|||||
| Restricted Cash |
200,000 |
- |
|||||
| Other Assets, Net |
32,440 |
23,361 |
|||||
| $ 1,108,140 |
$ 2,002,407 |
||||||
| LIABILITIES AND STOCKHOLDERS' EQUITY |
|||||||
| Current Liabilities: |
|||||||
| Accounts Payable |
$ 43,616 |
$ 52,952 |
|||||
| Accrued Liabilities |
49,108 |
66,090 |
|||||
| Interest Payable |
- |
32,008 |
|||||
| Other Current Liabilities |
6,148 |
13,406 |
|||||
| 98,872 |
164,456 |
||||||
| Long-term Debt |
428,715 |
1,210,919 |
|||||
| Deferred Income Taxes |
- |
4,147 |
|||||
| Other Liabilities |
16,622 |
7,854 |
|||||
| Commitments and Contingencies |
|||||||
| Stockholders' Equity |
563,931 |
615,031 |
|||||
| $ 1,108,140 |
$ 2,002,407 |
||||||
| HERCULES OFFSHORE, INC. AND SUBSIDIARIES |
||||||||||
| QUARTERLY CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||
| (In thousands, except per share data) |
||||||||||
| Successor |
Predecessor |
|||||||||
| Period from |
Period from |
Three Months |
||||||||
| (Unaudited) |
(Unaudited) |
(Unaudited) |
||||||||
| Revenue |
$ 32,442 |
$ 27,534 |
$ 178,670 |
|||||||
| Costs and Expenses: |
||||||||||
| Operating Expenses |
29,675 |
22,428 |
129,462 |
|||||||
| Asset Impairment |
- |
- |
117,001 |
|||||||
| Depreciation and Amortization |
4,534 |
14,765 |
42,826 |
|||||||
| General and Administrative |
7,120 |
7,295 |
14,703 |
|||||||
| 41,329 |
44,488 |
303,992 |
||||||||
| Operating Loss |
(8,887) |
(16,954) |
(125,322) |
|||||||
| Other Income (Expense): |
||||||||||
| Interest Expense |
(7,939) |
- |
(24,978) |
|||||||
| Reorganization Items, Net |
(1,330) |
(342,741) |
- |
|||||||
| Other, Net |
(4,785) |
13 |
(235) |
|||||||
| Loss Before Income Taxes |
(22,941) |
(359,682) |
(150,535) |
|||||||
| Income Tax Provision |
(728) |
(2,096) |
(3,584) |
|||||||
| Net Loss |
$ (23,669) |
$ (361,778) |
$ (154,119) |
|||||||
| Net Loss Per Share - Basic and Diluted |
$ (1.18) |
$ (2.24) |
$ (0.96) |
|||||||
| Weighted Average Shares Outstanding - Basic and Diluted |
19,989 |
161,641 |
160,816 |
|||||||
| HERCULES OFFSHORE, INC. AND SUBSIDIARIES |
|||||||||
| ANNUAL CONSOLIDATED STATEMENTS OF OPERATIONS |
|||||||||
| (In thousands, except per share data) |
|||||||||
| Successor |
Predecessor |
||||||||
| Period from |
Period from |
Twelve Months |
|||||||
| (Unaudited) |
(Unaudited) |
||||||||
| Revenue |
$ 32,442 |
$ 303,206 |
$ 900,251 |
||||||
| Costs and Expenses: |
|||||||||
| Operating Expenses |
29,675 |
271,988 |
543,236 |
||||||
| Asset Impairment |
- |
- |
199,508 |
||||||
| Depreciation and Amortization |
4,534 |
126,963 |
170,898 |
||||||
| General and Administrative |
7,120 |
79,884 |
75,108 |
||||||
| 41,329 |
478,835 |
988,750 |
|||||||
| Operating Loss |
(8,887) |
(175,629) |
(88,499) |
||||||
| Other Income (Expense): |
|||||||||
| Interest Expense |
(7,939) |
(61,173) |
(99,142) |
||||||
| Loss on Extinguishment of Debt |
- |
(1,884) |
(19,925) |
||||||
| Reorganization Items, Net |
(1,330) |
(357,050) |
- |
||||||
| Other, Net |
(4,785) |
284 |
(39) |
||||||
| Loss Before Income Taxes |
(22,941) |
(595,452) |
(207,605) |
||||||
| Income Tax Provision |
(728) |
(7,042) |
(8,505) |
||||||
| Net Loss |
$ (23,669) |
$ (602,494) |
$ (216,110) |
||||||
| Net Loss Per Share - Basic and Diluted |
$ (1.18) |
$ (3.73) |
$ (1.35) |
||||||
| Weighted Average Shares Outstanding - Basic and Diluted |
19,989 |
161,430 |
160,598 |
||||||
| HERCULES OFFSHORE, INC. AND SUBSIDIARIES |
||||||||
| CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
| (In thousands) |
||||||||
| Successor |
Predecessor |
|||||||
| Period from |
Period from |
Twelve Months |
||||||
| (Unaudited) |
(Unaudited) |
|||||||
| Cash Flows from Operating Activities: |
||||||||
| Net Loss |
$ (23,669) |
$ (602,494) |
$ (216,110) |
|||||
| Adjustments to Reconcile Net Loss to Net Cash Provided by (Used in) Operating Activities: |
||||||||
| Depreciation and Amortization |
4,534 |
126,963 |
170,898 |
|||||
| Stock-Based Compensation Expense |
26 |
6,922 |
8,348 |
|||||
| Deferred Income Taxes |
16 |
1,931 |
(7,691) |
|||||
| Provision for Doubtful Accounts Receivable |
1,855 |
7,665 |
5,627 |
|||||
| (Gain) Loss on Disposal of Assets, Net |
(28) |
970 |
(22,598) |
|||||
| Asset Impairment |
- |
- |
199,508 |
|||||
| Non-Cash Reorganization Items, Net |
- |
344,231 |
- |
|||||
| Non-Cash Loss on Derivative |
4,837 |
- |
- |
|||||
| Other |
342 |
2,146 |
4,810 |
|||||
| Net Change in Operating Assets and Liabilities |
(14,372) |
102,065 |
(28,079) |
|||||
| Net Cash Provided by (Used in) Operating Activities |
(26,459) |
(9,601) |
114,713 |
|||||
| Cash Flows from Investing Activities: |
||||||||
| Capital Expenditures |
(5,066) |
(78,097) |
(147,522) |
|||||
| Increase in Restricted Cash |
- |
(200,000) |
- |
|||||
| Insurance Proceeds Received |
- |
3,543 |
9,067 |
|||||
| Proceeds from Sale of Assets, Net |
78 |
9,697 |
35,135 |
|||||
| Other |
377 |
227 |
1,479 |
|||||
| Net Cash Used in Investing Activities |
(4,611) |
(264,630) |
(101,841) |
|||||
| Cash Flows from Financing Activities: |
||||||||
| Long-term Debt Borrowings |
- |
436,500 |
300,000 |
|||||
| Redemption of 7.125% Senior Secured Notes |
- |
- |
(300,000) |
|||||
| Payment of Debt Issuance Costs |
- |
(8,356) |
(3,914) |
|||||
| Other |
- |
- |
573 |
|||||
| Net Cash Provided by (Used in) Financing Activities |
- |
428,144 |
(3,341) |
|||||
| Net Increase (Decrease) in Cash and Cash Equivalents |
(31,070) |
153,913 |
9,531 |
|||||
| Cash and Cash Equivalents at Beginning of Period |
361,850 |
207,937 |
198,406 |
|||||
| Cash and Cash Equivalents at End of Period |
$ 330,780 |
$ 361,850 |
$ 207,937 |
|||||
| HERCULES OFFSHORE, INC. AND SUBSIDIARIES |
||||||||||||
| QUARTERLY SELECTED FINANCIAL AND OPERATING DATA |
||||||||||||
| (Dollars in thousands, except per day amounts) |
||||||||||||
| (Unaudited) |
||||||||||||
| Successor |
Predecessor |
|||||||||||
| (a) |
(b) |
(c) |
(a) + (b) - (c) |
|||||||||
| Period from |
Period from |
Three Months |
Change |
% Change |
||||||||
| Domestic Offshore: |
||||||||||||
| Number of rigs (as of end of period) |
18 |
18 |
24 |
|||||||||
| Revenue |
$ 9,859 |
$ 10,347 |
$ 90,241 |
$ (70,035) |
(77.6%) |
|||||||
| Operating expenses |
8,966 |
5,408 |
59,304 |
(44,930) |
(75.8%) |
|||||||
| Asset impairment |
- |
- |
117,001 |
(117,001) |
n/m |
|||||||
| Depreciation and amortization expense |
1,097 |
4,466 |
16,628 |
(11,065) |
(66.5%) |
|||||||
| General and administrative expenses |
404 |
484 |
1,490 |
(602) |
(40.4%) |
|||||||
| Operating loss |
$ (608) |
$ (11) |
$ (104,182) |
$ 103,563 |
(99.4%) |
|||||||
| International Offshore: |
||||||||||||
| Number of rigs (as of end of period) |
9 |
9 |
9 |
|||||||||
| Revenue |
$ 17,321 |
$ 12,394 |
$ 64,606 |
$ (34,891) |
(54.0%) |
|||||||
| Operating expenses |
14,395 |
13,251 |
54,013 |
(26,367) |
(48.8%) |
|||||||
| Depreciation and amortization expense |
1,870 |
8,510 |
20,385 |
(10,005) |
(49.1%) |
|||||||
| General and administrative expenses |
2,691 |
970 |
1,165 |
2,496 |
214.2% |
|||||||
| Operating loss |
$ (1,635) |
$ (10,337) |
$ (10,957) |
$ (1,015) |
9.3% |
|||||||
| International Liftboats: |
||||||||||||
| Number of liftboats (as of end of period) |
19 |
19 |
24 |
|||||||||
| Revenue |
$ 5,262 |
$ 4,793 |
$ 23,823 |
$ (13,768) |
(57.8%) |
|||||||
| Operating expenses |
6,314 |
3,769 |
16,145 |
(6,062) |
(37.5%) |
|||||||
| Depreciation and amortization expense |
1,567 |
1,539 |
4,895 |
(1,789) |
(36.5%) |
|||||||
| General and administrative expenses |
626 |
918 |
1,845 |
(301) |
(16.3%) |
|||||||
| Operating income (loss) |
$ (3,245) |
$ (1,433) |
$ 938 |
$ (5,616) |
n/m |
|||||||
| Total Company: |
||||||||||||
| Revenue |
$ 32,442 |
$ 27,534 |
$ 178,670 |
$ (118,694) |
(66.4%) |
|||||||
| Operating expenses |
29,675 |
22,428 |
129,462 |
(77,359) |
(59.8%) |
|||||||
| Asset impairment |
- |
- |
117,001 |
(117,001) |
n/m |
|||||||
| Depreciation and amortization expense |
4,534 |
14,765 |
42,826 |
(23,527) |
(54.9%) |
|||||||
| General and administrative expenses |
7,120 |
7,295 |
14,703 |
(288) |
(2.0%) |
|||||||
| Operating loss |
(8,887) |
(16,954) |
(125,322) |
99,481 |
(79.4%) |
|||||||
| Interest expense |
(7,939) |
- |
(24,978) |
17,039 |
(68.2%) |
|||||||
| Reorganization items, net |
(1,330) |
(342,741) |
- |
(344,071) |
n/m |
|||||||
| Other, net |
(4,785) |
13 |
(235) |
(4,537) |
n/m |
|||||||
| Loss before income taxes |
(22,941) |
(359,682) |
(150,535) |
(232,088) |
154.2% |
|||||||
| Income tax provision |
(728) |
(2,096) |
(3,584) |
760 |
(21.2%) |
|||||||
| Net loss |
$ (23,669) |
$ (361,778) |
$ (154,119) |
$ (231,328) |
150.1% |
|||||||
| HERCULES OFFSHORE, INC. AND SUBSIDIARIES |
||||||||||||
| ANNUAL SELECTED FINANCIAL AND OPERATING DATA - (Continued) |
||||||||||||
| (Dollars in thousands, except per day amounts) |
||||||||||||
| (Unaudited) |
||||||||||||
| Successor |
Predecessor |
|||||||||||
| (a) |
(b) |
(c) |
(a) + (b) - (c) |
|||||||||
| Period from |
Period from |
Twelve Months |
Change |
% Change |
||||||||
| Domestic Offshore: |
||||||||||||
| Number of rigs (as of end of period) |
18 |
18 |
24 |
|||||||||
| Revenue |
$ 9,859 |
$ 131,308 |
$ 497,209 |
$ (356,042) |
(71.6%) |
|||||||
| Operating expenses |
8,966 |
95,279 |
261,399 |
(157,154) |
(60.1%) |
|||||||
| Asset impairment |
- |
- |
199,508 |
(199,508) |
n/m |
|||||||
| Depreciation and amortization expense |
1,097 |
39,031 |
70,576 |
(30,448) |
(43.1%) |
|||||||
| General and administrative expenses |
404 |
5,462 |
6,314 |
(448) |
(7.1%) |
|||||||
| Operating loss |
$ (608) |
$ (8,464) |
$ (40,588) |
$ 31,516 |
(77.6%) |
|||||||
| International Offshore: |
||||||||||||
| Number of rigs (as of end of period) |
9 |
9 |
9 |
|||||||||
| Revenue |
$ 17,321 |
$ 113,438 |
$ 291,486 |
$ (160,727) |
(55.1%) |
|||||||
| Operating expenses |
14,395 |
131,291 |
207,190 |
(61,504) |
(29.7%) |
|||||||
| Depreciation and amortization expense |
1,870 |
71,033 |
75,672 |
(2,769) |
(3.7%) |
|||||||
| General and administrative expenses |
2,691 |
6,225 |
8,322 |
594 |
7.1% |
|||||||
| Operating income (loss) |
$ (1,635) |
$ (95,111) |
$ 302 |
$ (97,048) |
n/m |
|||||||
| International Liftboats: |
||||||||||||
| Number of liftboats (as of end of period) |
19 |
19 |
24 |
|||||||||
| Revenue |
$ 5,262 |
$ 58,460 |
$ 111,556 |
$ (47,834) |
(42.9%) |
|||||||
| Operating expenses |
6,314 |
45,418 |
74,647 |
(22,915) |
(30.7%) |
|||||||
| Depreciation and amortization expense |
1,567 |
14,599 |
20,763 |
(4,597) |
(22.1%) |
|||||||
| General and administrative expenses |
626 |
11,608 |
11,712 |
522 |
4.5% |
|||||||
| Operating income (loss) |
$ (3,245) |
$ (13,165) |
$ 4,434 |
$ (20,844) |
n/m |
|||||||
| Total Company: |
||||||||||||
| Revenue |
$ 32,442 |
$ 303,206 |
$ 900,251 |
$ (564,603) |
(62.7%) |
|||||||
| Operating expenses |
29,675 |
271,988 |
543,236 |
(241,573) |
(44.5%) |
|||||||
| Asset impairment |
- |
- |
199,508 |
(199,508) |
n/m |
|||||||
| Depreciation and amortization expense |
4,534 |
126,963 |
170,898 |
(39,401) |
(23.1%) |
|||||||
| General and administrative expenses |
7,120 |
79,884 |
75,108 |
11,896 |
15.8% |
|||||||
| Operating loss |
(8,887) |
(175,629) |
(88,499) |
(96,017) |
108.5% |
|||||||
| Interest expense |
(7,939) |
(61,173) |
(99,142) |
30,030 |
(30.3%) |
|||||||
| Loss on extinguishment of debt |
- |
(1,884) |
(19,925) |
18,041 |
n/m |
|||||||
| Reorganization items, net |
(1,330) |
(357,050) |
- |
(358,380) |
n/m |
|||||||
| Other, net |
(4,785) |
284 |
(39) |
(4,462) |
n/m |
|||||||
| Loss before income taxes |
(22,941) |
(595,452) |
(207,605) |
(410,788) |
197.9% |
|||||||
| Income tax provision |
(728) |
(7,042) |
(8,505) |
735 |
(8.6%) |
|||||||
| Net loss |
$ (23,669) |
$ (602,494) |
$ (216,110) |
$ (410,053) |
189.7% |
|||||||
| HERCULES OFFSHORE, INC. AND SUBSIDIARIES |
||||||||||
| QUARTERLY SELECTED FINANCIAL AND OPERATING DATA - (Continued) |
||||||||||
| (Dollars in thousands, except per day amounts) |
||||||||||
| (Unaudited) |
||||||||||
| Period from November 6, 2015 to December 31, 2015 (Successor) |
||||||||||
| Operating Days |
Available Days |
Utilization (1) |
Average |
Average |
||||||
| Domestic Offshore |
159 |
495 |
32.1% |
$ 62,006 |
$ 18,113 |
|||||
| International Offshore |
220 |
440 |
50.0% |
78,732 |
32,716 |
|||||
| International Liftboats |
298 |
990 |
30.1% |
17,658 |
6,378 |
|||||
| Period from October 1, 2015 to November 6, 2015 (Predecessor) |
||||||||||
| Operating Days |
Available Days |
Utilization (1) |
Average |
Average |
||||||
| Domestic Offshore |
164 |
333 |
49.2% |
$ 63,091 |
$ 16,240 |
|||||
| International Offshore |
147 |
296 |
49.7% |
84,313 |
44,767 |
|||||
| International Liftboats |
244 |
666 |
36.6% |
19,643 |
5,659 |
|||||
| Three Months Ended December 31, 2014 (Predecessor) |
||||||||||
| Operating Days |
Available Days |
Utilization (1) |
Average |
Average |
||||||
| Domestic Offshore |
850 |
1,329 |
64.0% |
$ 106,166 |
$ 44,623 |
|||||
| International Offshore |
490 |
736 |
66.6% |
131,849 |
73,387 |
|||||
| International Liftboats |
859 |
2,116 |
40.6% |
27,733 |
7,630 |
|||||
| (1) |
Utilization is defined as the total number of days our rigs or liftboats, as applicable, were under contract, known as operating days, in the period as a percentage of the total number of available days in the period. Days during which our rigs and liftboats were undergoing major refurbishments, upgrades or construction, and days during which our rigs and liftboats are cold stacked, are not counted as available days. Days during which our liftboats are in the shipyard undergoing drydocking or inspection are considered available days for the purposes of calculating utilization. |
||||||||||
| (2) |
Average revenue per rig or liftboat per day is defined as revenue earned by our rigs or liftboats, as applicable, in the period divided by the total number of operating days for our rigs or liftboats, as applicable, in the period. |
||||||||||
| (3) |
Average operating expense per rig or liftboat per day is defined as operating expenses, excluding depreciation and amortization, incurred by our rigs or liftboats, as applicable, in the period divided by the total number of available days in the period. We use available days to calculate average operating expense per rig or liftboat per day rather than operating days, which are used to calculate average revenue per rig or liftboat per day, because we incur operating expenses on our rigs and liftboats even when they are not under contract and earning a dayrate. |
||||||||||
| HERCULES OFFSHORE, INC. AND SUBSIDIARIES |
||||||||||
| ANNUAL SELECTED FINANCIAL AND OPERATING DATA - (Continued) |
||||||||||
| (Dollars in thousands, except per day amounts) |
||||||||||
| (Unaudited) |
||||||||||
| Period from November 6, 2015 to December 31, 2015 (Successor) |
||||||||||
| Operating Days |
Available Days |
Utilization (1) |
Average |
Average |
||||||
| Domestic Offshore |
159 |
495 |
32.1% |
$ 62,006 |
$ 18,113 |
|||||
| International Offshore |
220 |
440 |
50.0% |
78,732 |
32,716 |
|||||
| International Liftboats |
298 |
990 |
30.1% |
17,658 |
6,378 |
|||||
| Period from January 1, 2015 to November 6, 2015 (Predecessor) |
||||||||||
| Operating Days |
Available Days |
Utilization (1) |
Average |
Average |
||||||
| Domestic Offshore |
1,497 |
2,867 |
52.2% |
$ 87,714 |
$ 33,233 |
|||||
| International Offshore |
1,221 |
2,480 |
49.2% |
92,906 |
52,940 |
|||||
| International Liftboats |
2,776 |
6,686 |
41.5% |
21,059 |
6,793 |
|||||
| Twelve Months Ended December 31, 2014 (Predecessor) |
||||||||||
| Operating Days |
Available Days |
Utilization (1) |
Average |
Average |
||||||
| Domestic Offshore |
4,624 |
6,243 |
74.1% |
$ 107,528 |
$ 41,871 |
|||||
| International Offshore |
2,025 |
2,875 |
70.4% |
143,944 |
72,066 |
|||||
| International Liftboats |
4,332 |
8,395 |
51.6% |
25,752 |
8,892 |
|||||
| (1) |
Utilization is defined as the total number of days our rigs or liftboats, as applicable, were under contract, known as operating days, in the period as a percentage of the total number of available days in the period. Days during which our rigs and liftboats were undergoing major refurbishments, upgrades or construction, and days during which our rigs and liftboats are cold stacked, are not counted as available days. Days during which our liftboats are in the shipyard undergoing drydocking or inspection are considered available days for the purposes of calculating utilization. |
||||||||||
| (2) |
Average revenue per rig or liftboat per day is defined as revenue earned by our rigs or liftboats, as applicable, in the period divided by the total number of operating days for our rigs or liftboats, as applicable, in the period. |
||||||||||
| (3) |
Average operating expense per rig or liftboat per day is defined as operating expenses, excluding depreciation and amortization, incurred by our rigs or liftboats, as applicable, in the period divided by the total number of available days in the period. We use available days to calculate average operating expense per rig or liftboat per day rather than operating days, which are used to calculate average revenue per rig or liftboat per day, because we incur operating expenses on our rigs and liftboats even when they are not under contract and earning a dayrate. |
||||||||||
| Hercules Offshore, Inc. and Subsidiaries |
|||||||
| Reconciliation of GAAP to Non-GAAP Financial Measures |
|||||||
| (Unaudited) |
|||||||
| (In thousands, except per share data) |
|||||||
| We report our financial results in accordance with generally accepted accounting principles (GAAP). However, management believes that certain non-GAAP performance measures and ratios may provide users of this financial information additional meaningful information. Non-GAAP financial measures we may present from time to time are revenue, operating income, income from continuing operations, net income or diluted earnings per share excluding certain charges or amounts. These adjusted amounts are not a measure of financial performance under GAAP. Accordingly, they should not be considered as a substitute for revenue, operating income, income from continuing operations, net income, earnings per share or other income data prepared in accordance with GAAP. See the tables below for supplemental financial data and corresponding reconciliations to GAAP financial measures for the periods January 1, 2015 to November 6, 2015, October 1, 2015 to November 6, 2015 and November 6, 2015 to December 31, 2015 and the three and twelve months ended December 31, 2014. Non-GAAP financial measures should be viewed in addition to, and not as an alternative for, the Company's reported results prepared in accordance with GAAP. The non-GAAP measures included in this press release have been reconciled to the nearest GAAP measure in the following tables: |
|||||||
| Successor |
Predecessor |
||||||
| Period from |
Period from |
Three Months |
|||||
| Operating Loss: |
|||||||
| GAAP Operating Loss |
$ (8,887) |
$ (16,954) |
$ (125,322) |
||||
| Adjustment |
- |
2,890 |
(b) |
117,001 |
(d) |
||
| Non-GAAP Operating Loss |
$ (8,887) |
$ (14,064) |
$ (8,321) |
||||
| Other Expense: |
|||||||
| GAAP Other Expense |
$ (14,054) |
$ (342,728) |
$ (25,213) |
||||
| Adjustment |
1,330 |
(a) |
342,741 |
(c) |
- |
||
| Non-GAAP Other Expense |
$ (12,724) |
$ 13 |
$ (25,213) |
||||
| Provision for Income Taxes: |
|||||||
| GAAP Provision for Income Taxes |
$ (728) |
$ (2,096) |
$ (3,584) |
||||
| Tax Adjustment |
- |
- |
- |
||||
| Non-GAAP Provision for Income Taxes |
$ (728) |
$ (2,096) |
$ (3,584) |
||||
| Net Loss: |
|||||||
| GAAP Net Loss |
$ (23,669) |
$ (361,778) |
$ (154,119) |
||||
| Total Adjustment |
1,330 |
345,631 |
117,001 |
||||
| Non-GAAP Net Loss |
$ (22,339) |
$ (16,147) |
$ (37,118) |
||||
| Diluted Loss per Share: |
|||||||
| GAAP Diluted Loss per Share |
$ (1.18) |
$ (2.24) |
$ (0.96) |
||||
| Adjustment per Share |
0.06 |
2.14 |
0.73 |
||||
| Non-GAAP Diluted Loss per Share |
$ (1.12) |
$ (0.10) |
$ (0.23) |
||||
| (a) This amount represents a $1.3 million charge for reorganization items related to professional fees. |
|||||||
| (b) This amount represents an $8.1 million charge for stock-based compensation due to bankruptcy and a $5.2 million gain on settlement of a contractual dispute. |
|||||||
| (c) This amount represents a $342.7 million charge for reorganization items which includes a $1.0 billion non-cash net loss due to fresh start accounting adjustments, a $686.6 million non-cash gain on settlement of liabilities subject to compromise (debt forgiveness) and a $10.0 million charge for other reorganization items related to professional fees. |
|||||||
| (d) This amount represents a $117.0 million non-cash impairment charge of property and equipment. |
|||||||
| Hercules Offshore, Inc. and Subsidiaries |
|||||||
| Reconciliation of GAAP to Non-GAAP Financial Measures (Continued) |
|||||||
| (Unaudited) |
|||||||
| (In thousands, except per share data) |
|||||||
| Successor |
Predecessor |
||||||
| Period from |
Period from |
Twelve Months |
|||||
| Operating Income (Loss): |
|||||||
| GAAP Operating Loss |
$ (8,887) |
$ (175,629) |
$ (88,499) |
||||
| Adjustment |
- |
25,333 |
(b) |
176,888 |
(d) |
||
| Non-GAAP Operating Income (Loss) |
$ (8,887) |
$ (150,296) |
$ 88,389 |
||||
| Other Expense: |
|||||||
| GAAP Other Expense |
$ (14,054) |
$ (419,823) |
$ (119,106) |
||||
| Adjustment |
1,330 |
(a) |
358,934 |
(c) |
19,925 |
(e) |
|
| Non-GAAP Other Expense |
$ (12,724) |
$ (60,889) |
$ (99,181) |
||||
| Provision for Income Taxes: |
|||||||
| GAAP Provision for Income Taxes |
$ (728) |
$ (7,042) |
$ (8,505) |
||||
| Tax Adjustment |
- |
- |
- |
||||
| Non-GAAP Provision for Income Taxes |
$ (728) |
$ (7,042) |
$ (8,505) |
||||
| Net Loss: |
|||||||
| GAAP Net Loss |
$ (23,669) |
$ (602,494) |
$ (216,110) |
||||
| Total Adjustment |
1,330 |
384,267 |
196,813 |
||||
| Non-GAAP Net Loss |
$ (22,339) |
$ (218,227) |
$ (19,297) |
||||
| Diluted Loss per Share: |
|||||||
| GAAP Diluted Loss per Share |
$ (1.18) |
$ (3.73) |
$ (1.35) |
||||
| Adjustment per Share |
0.06 |
2.38 |
1.23 |
||||
| Non-GAAP Diluted Loss per Share |
$ (1.12) |
$ (1.35) |
$ (0.12) |
||||
| (a) This amount represents a $1.3 million charge for reorganization items related to professional fees. |
|||||||
| (b) This amount represents $18.9 million of costs related to pre-petition financing and restructuring activities, an $8.1 million charge for stock-based compensation due to bankruptcy, a $5.2 million gain on settlement of a contractual dispute and a $3.6 million net loss on the sale of assets, including six cold stacked drilling rigs. |
|||||||
| (c) This amount represents a $357.1 million charge for reorganization items which includes a $1.0 billion non-cash net loss due to fresh start accounting adjustments, a $686.6 million non-cash gain on settlement of liabilities subject to compromise (debt forgiveness), an $11.5 million non-cash charge related to a write-off of unamortized debt issuance costs and a $12.8 million charge for other reorganization items related to professional fees. Additionally, this amount includes a $1.9 million charge related to the termination of the Predecessor Credit Facility. |
|||||||
| (d) This amount represents a $199.5 million non-cash impairment charge of property and equipment and a $22.6 million net gain on the sale of cold stacked drilling rigs. |
|||||||
| (e) This amount represents a charge of $19.9 million related to retirement of our 7.125% senior secured notes and issuance of our 6.75% senior notes. |
|||||||
SOURCE Hercules Offshore, Inc.
Related Links
WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?
Newsrooms &
Influencers
Digital Media
Outlets
Journalists
Opted In
Share this article