Press Releases
First quarter 2013 results were impacted by
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$22.7 million loss on the sale of ERT and associated divestiture costs -
$14.1 million loss in connection with the settlement of our commodity hedge contracts associated with the oil and gas business
Summary of Results |
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(in thousands, except per share amounts and percentages, unaudited) | ||||||||||||
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Quarter Ended | ||||||||||||
3/31/2013 | 3/31/2012 | 12/31/2012 | ||||||||||
Revenues | $ | 197,429 | $ | 229,842 | $ | 201,696 | ||||||
Gross Profit (Loss) | ||||||||||||
Operating | $ | 52,567 | $ | 72,483 | $ | 49,026 | ||||||
27 | % | 32 | % | 24 | % | |||||||
Contracting Services Impairments (1) | - | - | (157,951 | ) | ||||||||
Total | $ | 52,567 | $ | 72,483 | $ | (108,925 | ) | |||||
Net Income (Loss) Applicable to Common Shareholders |
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Income (Loss) from continuing operations (2) | $ | 557 | $ | 16,874 | $ | (99,679 | ) | |||||
Income (Loss) from discontinued operations (3) | 1,058 | 48,853 | (71,888 | ) | ||||||||
Total | $ | 1,615 | $ | 65,727 | $ | (171,567 | ) | |||||
Diluted Earnings (Loss) Per Share | ||||||||||||
Income (Loss) from continuing operations ** | $ | 0.01 | $ | 0.16 | $ | (0.95 | ) | |||||
Income (Loss) from discontinued operations | $ | 0.01 | $ | 0.46 | $ | (0.69 | ) | |||||
Total | $ | 0.02 | $ | 0.62 | $ | (1.64 | ) | |||||
Adjusted EBITDA from continuing operations ** | $ | 42,031 | $ | 74,098 | $ | 47,699 | ||||||
Adjusted EBITDAX from discontinued operations | 31,754 | 134,543 | 65,528 | |||||||||
Adjusted EBITDAX (4) | $ | 73,785 | $ | 208,641 | $ | 113,227 | ||||||
** | First quarter 2013 includes $14.1 million loss in connection with the settlement of our commodity hedge contracts associated with our former oil and gas business, which were not included in the sale of ERT. | |
Note: Footnotes appear at end of press release. |
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Segment Information, Operational and Financial Highlights |
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(in thousands, unaudited) | ||||||||||||
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Three Months Ended | ||||||||||||
3/31/2013 | 3/31/2012 | 12/31/2012 | ||||||||||
Continuing Operations: |
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Revenues: | ||||||||||||
Contracting Services | $ | 198,054 | $ | 244,544 | $ | 224,201 | ||||||
Production Facilities | 20,393 | 20,022 | 20,082 | |||||||||
Intercompany Eliminations | (21,018 | ) | (34,724 | ) | (42,587 | ) | ||||||
Total | $ | 197,429 | $ | 229,842 | $ | 201,696 | ||||||
Income (Loss) from Operations: | ||||||||||||
Contracting Services | $ | 39,304 | $ | 59,124 | $ | 39,433 | ||||||
Production Facilities | 11,185 | 10,049 | 9,971 | |||||||||
Loss on sale of asset | - | - | (543 | ) | ||||||||
Contracting Services Impairments (1) | - | - | (157,951 | ) | ||||||||
Corporate/Other | (33,531 | ) | (16,085 | ) | (31,551 | ) | ||||||
Intercompany Eliminations | (1,720 | ) | (3,020 | ) | (4,995 | ) | ||||||
Total | $ | 15,238 | $ | 50,068 | $ | (145,636 | ) | |||||
Equity in Earnings of Equity Investments | $ | 610 | $ | 407 | $ | 887 | ||||||
Discontinued Operations (Oil and Gas): | ||||||||||||
Revenues | $ | 48,847 | $ | 178,085 | $ | 110,089 | ||||||
Income (Loss) from Operations (2) | $ | 4,360 | $ | 82,129 | $ | (103,611 | ) | |||||
Note: Footnotes appear at end of press release. |
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Contracting Services
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Well Intervention revenues increased slightly in the first quarter of
2013 compared to the fourth quarter of 2012 due to full vessel
utilization of the fleet. On a combined basis, vessel utilization
increased to 100% in the first quarter of 2013 compared to 94% in the
fourth quarter of 2012. There was full utilization in the
North Sea for the first quarter of 2013 compared to 91% in the fourth quarter of 2012. The Q4000 achieved 100% utilization in the Gulf ofMexico in the first quarter of 2013, marking it the third consecutive quarter of full utilization. -
Robotics revenues decreased in the first quarter of 2013 compared to
the fourth quarter of 2012, primarily reflecting a reduction in vessel
utilization. Most significantly, the Deep Cygnus was idle for
75 days during the first quarter. Chartered vessel utilization in the
first quarter of 2013 was 69% compared to 87% in the fourth quarter of
2012. The utilization decrease reflects the potentially harsh weather
conditions in the
North Sea during the winter months resulting in a seasonal decline in the scheduling of robotics activities during that period. -
Subsea Construction revenues remained relatively flat in the first quarter of 2013 compared to the fourth quarter of 2012. Although utilization for the Express improved quarter over quarter, the vessel worked at standby rates for approximately one month during the quarter due to customer scheduling delays. The Caesar continued its work offshoreMexico on an accommodations project for the entire first quarter of 2013. On a combined basis,Subsea Construction vessel utilization increased to 90% in the first quarter of 2013 from 78% in the fourth quarter of 2012.
Other Expenses
- Selling, general and administrative expenses were 11.8% of revenue in the first quarter of 2013, 12.7% of revenue in the fourth quarter of 2012, and 9.8% in the first quarter of 2012.
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Net interest expense and other increased to
$14.1 million in the first quarter of 2013 from$11.9 million in the fourth quarter of 2012. Net interest expense decreased slightly to$10.3 million in the first quarter of 2013 compared to$10.8 million in the fourth quarter of 2012, primarily due to the repayment of$318.4 million of our Term Loan and Revolver debt inFebruary 2013 . Offset in part by a$2.9 million charge to accelerate a pro rata portion of the deferred financing costs associated with this Term Loan debt repayment.
Financial Condition and Liquidity
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Consolidated net debt at
March 31, 2013 decreased to$72 million from$582 million atDecember 31, 2012 . Our total liquidity atMarch 31, 2013 was approximately$1.1 billion , consisting of cash on hand of$626 million and revolver availability of$514 million . Net debt to book capitalization atMarch 31, 2013 was 5%. (Net debt to book capitalization is a non-GAAP measure. See reconciliation attached hereto.) -
We incurred capital expenditures (including capitalized interest)
totaling
$80 million in the first quarter of 2013, compared to$157 million in the fourth quarter of 2012 and$107 million in the first quarter of 2012.$30 million of first quarter 2013 capital expenditures related to the H534 conversion.
Footnotes to “Summary of Results”:
(1) Fourth quarter 2012 asset impairment charge of
(2) Fourth quarter 2012 included impact of
(3) Fourth quarter 2012 included
(4) Non-GAAP measure. See reconciliation attached hereto.
Footnotes to “Segment Information, Operational and Financial Highlights”:
(1) Fourth quarter 2012 asset impairment charge of
(2) Fourth quarter 2012 included
Conference Call Information
Further details are provided in the presentation for Helix’s quarterly
conference call to review its first quarter 2013 results (see the
“Investor Relations” page of Helix’s website, www.HelixESG.com).
The call, scheduled for
Reconciliation of Non-GAAP Financial Measures
Management evaluates Company performance and financial condition using certain non-GAAP metrics, primarily Adjusted EBITDA from continuing operations and Adjusted EBITDAX, net debt and net debt to book capitalization. We calculate Adjusted EBITDA from continuing operations as earnings before net interest expense and other, taxes, depreciation and amortization. Adjusted EBITDAX is Adjusted EBITDA plus the earnings of our former oil and gas business before net interest expense and other, taxes, depreciation and amortization, and exploration expenses. Net debt is calculated as the sum of financial debt less cash and equivalents on hand. Net debt to book capitalization is calculated by dividing net debt by the sum of net debt, convertible preferred stock and shareholders’ equity. These non-GAAP measures are useful to investors and other internal and external users of our financial statements in evaluating our operating performance because they are widely used by investors in our industry to measure a company’s operating performance without regard to items which can vary substantially from company to company, and help investors meaningfully compare our results from period to period. Adjusted EBITDA and Adjusted EBITDAX should not be considered in isolation or as a substitute for, but instead is supplemental to, income from operations, net income or other income data prepared in accordance with GAAP. Non-GAAP financial measures should be viewed in addition to, and not as an alternative to our reported results prepared in accordance with GAAP. Users of this financial information should consider the types of events and transactions which are excluded.
Forward-Looking Statements
This press release contains forward-looking statements that involve
risks, uncertainties and assumptions that could cause our results to
differ materially from those expressed or implied by such
forward-looking statements. All statements, other than statements of
historical fact, are "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995, including, without
limitation, any statements regarding our strategy, any statements
regarding future utilization, any projections of financial items; the
timing of the closing of our pipelay vessel sales; future operations
expenditures; any statements of the plans, strategies and objectives of
management for future operations; any statement concerning developments;
any statements regarding future economic conditions or performance; any
statements of expectation or belief; and any statements of assumptions
underlying any of the foregoing. The forward-looking statements are
subject to a number of known and unknown risks, uncertainties and other
factors including but not limited to the performance of contracts by
suppliers, customers and partners; actions by governmental and
regulatory authorities; delays, costs and difficulties related to the
pipelay vessel sales; operating hazards and delays; our ultimate ability
to realize current backlog; employee management issues; complexities of
global political and economic developments; geologic risks; volatility
of oil and gas prices and other risks described from time to time in our
reports filed with the
HELIX ENERGY SOLUTIONS GROUP, INC. | ||||||||
Comparative Condensed Consolidated Statements of Operations | ||||||||
Three Months Ended Mar. 31, | ||||||||
(in thousands, except per share data) | 2013 | 2012 | ||||||
(unaudited) | ||||||||
Revenues | $ | 197,429 | $ | 229,842 | ||||
Cost of sales | 144,862 | 157,359 | ||||||
Gross profit | 52,567 | 72,483 | ||||||
Loss on settlement of commodity derivative contracts | (14,113 | ) | - | |||||
Selling, general and administrative expenses | (23,216 | ) | (22,415 | ) | ||||
Income from operations | 15,238 | 50,068 | ||||||
Equity in earnings of investments | 610 | 407 | ||||||
Other income - oil and gas | 2,818 | - | ||||||
Net interest expense and other | (16,889 | ) | (31,534 | ) | ||||
Income before income taxes | 1,777 | 18,941 | ||||||
Income tax provision | 443 | 1,278 | ||||||
Income from continuing operations | 1,334 | 17,663 | ||||||
Discontinued operations, net of tax | 1,058 | 48,853 | ||||||
Net income, including noncontrolling interests | 2,392 | 66,516 | ||||||
Less net income applicable to noncontrolling interests | (777 | ) | (789 | ) | ||||
Net income applicable to Helix | $ | 1,615 | $ | 65,727 | ||||
Weighted Avg. Common Shares Outstanding: | ||||||||
Basic | 105,032 | 104,530 | ||||||
Diluted | 105,165 | 104,989 | ||||||
Basic earnings per share of common stock: | ||||||||
Continuing operations | $ | 0.01 | $ | 0.16 | ||||
Discontinued operations | 0.01 | 0.46 | ||||||
Net income per share of common stock | $ | 0.02 | $ | 0.62 | ||||
Diluted earnings per share of common stock: | ||||||||
Continuing operations | $ | 0.01 | $ | 0.16 | ||||
Discontinued operations | 0.01 | 0.46 | ||||||
Net income per share of common stock | $ | 0.02 | $ | 0.62 | ||||
Comparative Condensed Consolidated Balance Sheets | |||||||||||||||
ASSETS |
LIABILITIES & SHAREHOLDERS' EQUITY |
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(in thousands) | Mar. 31, 2013 | Dec. 31, 2012 | (in thousands) | Mar. 31, 2013 | Dec. 31, 2012 | ||||||||||
(unaudited) | (unaudited) | ||||||||||||||
Current Assets: | Current Liabilities: | ||||||||||||||
Cash and equivalents (1) | $ | 625,650 | $ | 437,100 | Accounts payable | $ | 100,553 | $ | 92,398 | ||||||
Accounts receivable | 177,623 | 186,073 | Accrued liabilities | 122,024 | 161,514 | ||||||||||
Other current assets | 61,189 | 96,934 | Income tax payable | 35,797 | - | ||||||||||
C-A of discontinued operations | - | 84,000 | Current mat of L-T debt (1) | 10,247 | 16,607 | ||||||||||
C-L of discontinued operations | - | 182,527 | |||||||||||||
Total Current Assets | 864,462 | 804,107 | Total Current Liabilities | 268,621 | 453,046 | ||||||||||
Property & Equipment | 1,532,727 | 1,485,875 | Long-term debt (1) | 687,461 | 1,002,621 | ||||||||||
Equity investments | 165,452 | 167,599 | Deferred income taxes | 290,102 | 359,237 | ||||||||||
Goodwill | 61,732 | 62,935 | Other long-term liabilities |
14,976 |
5,025 | ||||||||||
Other assets, net | 41,958 | 49,837 | N-C liabilities of discontinued operations | - | 147,237 | ||||||||||
N-C assets of discontinued operations | - | 816,227 | Shareholders' equity (1) | 1,405,171 | 1,419,414 | ||||||||||
Total Assets | $ | 2,666,331 | $ | 3,386,580 | Total Liabilities & Equity | $ | 2,666,331 | $ | 3,386,580 | ||||||
(1) |
Net debt to book capitalization - 5% at March 31, 2013. Calculated as total debt less cash and equivalents ($72,058) divided by sum of total net debt, convertible preferred stock and shareholders' equity ($1,477,229). |
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Helix Energy Solutions Group, Inc. | ||||||||||
Reconciliation of Non GAAP Measures | ||||||||||
Three Months Ended March 31, 2013 | ||||||||||
Earnings Release: |
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Reconciliation From Net Income from Continuing Operations to Adjusted EBITDAX: |
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1Q13 |
1Q12 |
4Q12 |
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(in thousands) | ||||||||||
Net income (loss) from continuing operations | $ | 1,334 | $ | 17,663 | $ | (98,872 | ) | |||
Adjustments: | ||||||||||
Income tax provision (benefit) | 443 | 1,278 | (57,753 | ) | ||||||
Net interest expense and other | 16,889 | 31,534 | 11,876 | |||||||
Depreciation and amortization | 24,380 | 24,649 | 25,016 | |||||||
Asset impairment charges | - | - | 157,951 | |||||||
EBITDA | 43,046 | 75,124 | 38,218 | |||||||
Adjustments: | ||||||||||
Noncontrolling interest | (1,015 | ) | (1,026 | ) | (1,039 | ) | ||||
Loss on commodity derivative contracts | - | - | 9,977 | |||||||
Loss on sale of assets | - | - | 543 | |||||||
Adjusted EBITDA from continuing operations | 42,031 | 74,098 | 47,699 | |||||||
Adjusted EBITDAX from discontinued operations | 31,754 | 134,543 | 65,528 | |||||||
Adjusted EBITDAX | $ | 73,785 | $ | 208,641 | $ | 113,227 | ||||
We calculate adjusted EBITDA from continuing operations as earnings before net interest expense and other, taxes, depreciation and amortization. Adjusted EBITDAX is adjusted EBITDA plus the earnings of our former oil and gas business before net interest expense and other, taxes, depreciation and amortization, and exploration expenses. These non-GAAP measures are useful to investors and other internal and external users of our financial statements in evaluating our operating performance because they are widely used by investors in our industry to measure a company's operating performance without regard to items which can vary substantially from company to company and help investors meaningfully compare our results from period to period. Adjusted EBITDA and EBITDAX should not be considered in isolation or as a substitute for, but instead is supplemental to, income from operations, net income or other income data prepared in accordance with GAAP. Non-GAAP financial measures should be viewed in addition to, and not as an alternative to our reported results prepared in accordance with GAAP. Users of this financial information should consider the types of events and transactions which are excluded. |
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Helix Energy Solutions Group, Inc. | ||||
Reconciliation of Non GAAP Measures | ||||
Three Months Ended March 31, 2013 | ||||
Earnings Release: |
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Reconciliation of significant items: |
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1Q13 |
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(in thousands, except earnings per share data) | ||||
Nonrecurring items in continuing operations: | ||||
Loss on settlement of commodity derivative contracts | $ | 14,113 | ||
Tax benefit of the above | (4,940 | ) | ||
Nonrecurring items in continuing operations, net: | $ | 9,173 | ||
Diluted shares | 105,165 | |||
Net after income tax effect per share | $ | 0.09 | ||
Nonrecurring items in discontinued operations: | ||||
Loss on sale of ERT | $ | 22,653 | ||
Tax benefit of the above | (7,929 | ) | ||
Nonrecurring items in discontinued operations, net: | $ | 14,724 | ||
Diluted shares | 105,165 | |||
Net after income tax effect per share | $ | 0.15 | ||
Source:
Helix Energy Solutions Group
Terrence Jamerson,
281-618-0400
Director, Finance & Investor Relation