UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): February 19, 2014
Helix Energy Solutions Group, Inc.
(Exact name of registrant as specified in its charter)
|
Minnesota
(State or other jurisdiction
of incorporation)
|
001-32936
(Commission File Number)
|
95-3409686
(IRS Employer Identification No.)
|
|
|
3505 West Sam Houston Parkway North, Suite 400
Houston, Texas
(Address of principal executive offices)
|
281-618-0400
(Registrant’s telephone number, including area code)
|
77043
(Zip Code)
|
|
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
|_| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
|_| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
|_| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
|_| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition.
On February 19, 2014, Helix Energy Solutions Group, Inc. (“Helix”) issued a press release announcing its fourth quarter and year-end results of operations for the period ended December 31, 2013. Attached hereto as Exhibit 99.1, and incorporated by reference herein, is the press release.
Item 7.01 Regulation FD Disclosure.
On February 19, 2014, Helix issued a press release announcing its fourth quarter and year-end results of operations for the period ended December 31, 2013. In addition, on February 20, 2014, Helix is making a presentation (with slides) to analysts and investors regarding its financial and operating results. Attached hereto as Exhibits 99.1 and 99.2, respectively, and incorporated by reference herein are the press release and the slides for the Fourth Quarter Earnings Conference Call Presentation issued by Helix. The presentation materials will also be posted beginning on February 20, 2014 under Presentations in the For the Investor section of Helix’s website, www.HelixESG.com.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
Number Description
----------- ----------------
|
99.1
|
Press Release of Helix Energy Solutions Group, Inc. dated February 19, 2014 reporting financial results for the fourth quarter of 2013 and for the year ending December 31, 2013.
|
|
99.2
|
Fourth Quarter 2013 Conference Call Presentation.
|
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Date: February 19, 2014
| HELIX ENERGY SOLUTIONS GROUP, INC. | |||
|
|
By:
|
/s/ Anthony Tripodo | |
| Anthony Tripodo | |||
| Executive Vice President and Chief Financial Officer | |||
Index to Exhibits
Exhibit No. Description
|
99.1
|
Press Release of Helix Energy Solutions Group, Inc. dated February 19, 2014 reporting financial results for the fourth quarter of 2013 and for the year ending December 31, 2013.
|
|
99.2
|
Fourth Quarter 2013 Conference Call Presentation.
|
EXHIBIT 99.1
|
|
PRESSRELEASE
www.HelixESG.com
|
Helix Energy Solutions Group, Inc. · 3505 W. Sam Houston Parkway N., Suite 400 · Houston, TX 77043 · 281-618-0400 · fax: 281-618-0505
| For Immediate Release | 14-004 | ||
| Date: February 19, 2014 | Contact: | Terrence Jamerson | |
| Director, Finance & Investor Relations |
Helix Reports Fourth Quarter and Full Year 2013 Results
HOUSTON, TX – Helix Energy Solutions Group, Inc. (NYSE: HLX) reported net income of $36.5 million, or $0.35 per diluted share, for the fourth quarter of 2013 compared to a net loss of $171.6 million, or $(1.64) per diluted share, for the same period in 2012, and net income of $44.6 million, or $0.42 per diluted share, in the third quarter of 2013. Net income from continuing operations totaled $108.8 million, or $1.03 per diluted share, for the year ended December 31, 2013, as compared with a net loss of $70.0 million, or $(0.67) per diluted share, for the year ended December 31, 2012. Including our discontinued operations, net income for the year ended December 31, 2013 was $109.9 million, or $1.04 per diluted share, compared with a net loss of $46.3 million, or $(0.44) per diluted share, for the year ended December 31, 2012.
Owen Kratz, President and Chief Executive Officer of Helix, stated, “Fourth quarter operating cash flow, as measured by EBITDA, saw a 16% sequential increase over the third quarter ($81.5 million versus $70.2 million). Although earnings per share declined quarter-to-quarter, this was due in part to the third quarter gain on the sale of the Express and in part due to a higher effective income tax rate in the fourth quarter. Our Robotics business improved dramatically in the second half of 2013 while the Well Intervention business continues to be stout, posting a record quarterly revenues number.”
* * * * *
Summary of Results
(in thousands, except per share amounts and percentages, unaudited)
|
Quarter Ended
|
Year Ended
|
|||||||||||||||||||
|
12/31/2013
|
12/31/2012
|
9/30/2013
|
12/31/2013
|
12/31/2012
|
||||||||||||||||
|
Revenues
|
$ | 226,837 | $ | 201,696 | $ | 220,117 | $ | 876,561 | $ | 846,109 | ||||||||||
|
Gross Profit (Loss)
|
||||||||||||||||||||
|
Operating
|
$ | 71,164 | $ | 49,026 | $ | 69,457 | $ | 260,685 | $ | 227,050 | ||||||||||
| 31 | % | 24 | % | 32 | % | 30 | % | 27 | % | |||||||||||
|
Contracting Services Impairments (1)
|
- | (157,951 | ) | - | - | (177,135 | ) | |||||||||||||
|
Total
|
$ | 71,164 | $ | (108,925 | ) | $ | 69,457 | $ | 260,685 | $ | 49,915 | |||||||||
|
Net Income (Loss) Applicable to
Common Shareholders
|
||||||||||||||||||||
|
Income (Loss) from continuing operations
|
$ | 36,503 | $ | (99,679 | ) | $ | 44,549 | $ | 108,849 | $ | (70,018 | ) | ||||||||
|
Income (Loss) from discontinued operations
|
- | (71,888 | ) | 44 | 1,073 | 23,684 | ||||||||||||||
|
Total
|
$ | 36,503 | $ | (171,567 | ) | $ | 44,593 | $ | 109,922 | $ | (46,334 | ) | ||||||||
|
Diluted Earnings (Loss) Per Share
|
||||||||||||||||||||
|
Income (Loss) from continuing operations
|
$ | 0.35 | $ | (0.95 | ) | $ | 0.42 | $ | 1.03 | $ | (0.67 | ) | ||||||||
|
Income (Loss) from discontinued operations
|
$ | - | $ | (0.69 | ) | $ | - | $ | 0.01 | $ | 0.23 | |||||||||
|
Total
|
$ | 0.35 | $ | (1.64 | ) | $ | 0.42 | $ | 1.04 | $ | (0.44 | ) | ||||||||
|
Adjusted EBITDA from continuing operations
|
$ | 81,549 | $ | 47,699 | $ | 70,198 | $ | 268,311 | $ | 233,612 | ||||||||||
|
Adjusted EBITDAX from discontinued operations
|
- | 65,528 | - | 31,754 | 367,216 | |||||||||||||||
|
Adjusted EBITDAX (2)
|
$ | 81,549 | $ | 113,227 | $ | 70,198 | $ | 300,065 | $ | 600,828 | ||||||||||
Note: Footnotes appear at end of press release.
Segment Information, Operational and Financial Highlights
(in thousands, unaudited)
|
Quarter Ended
|
||||||||||||
|
12/31/2013
|
12/31/2012
|
9/30/2013
|
||||||||||
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Continuing Operations:
|
||||||||||||
|
Revenues:
|
||||||||||||
|
Contracting Services
|
$ | 224,881 | $ | 224,201 | $ | 208,728 | ||||||
|
Production Facilities
|
19,216 | 20,082 | 24,366 | |||||||||
|
Intercompany Eliminations
|
(17,260 | ) | (42,587 | ) | (12,977 | ) | ||||||
|
Total
|
$ | 226,837 | $ | 201,696 | $ | 220,117 | ||||||
|
Income (Loss) from Operations:
|
||||||||||||
|
Contracting Services
|
$ | 57,729 | $ | 39,433 | $ | 49,212 | ||||||
|
Production Facilities
|
9,814 | 9,971 | 14,136 | |||||||||
|
Gain (Loss) on Sale of Assets
|
- | (543 | ) | 15,812 | ||||||||
|
Contracting Services Impairments (1)
|
- | (157,951 | ) | - | ||||||||
|
Corporate/Other
|
(12,781 | ) | (31,551 | ) | (16,522 | ) | ||||||
|
Intercompany Eliminations
|
(822 | ) | (4,995 | ) | 21 | |||||||
|
Total
|
$ | 53,940 | $ | (145,636 | ) | $ | 62,659 | |||||
|
Equity in Earnings of Equity Investments
|
$ | 815 | $ | 887 | $ | 857 | ||||||
|
Discontinued Operations (Oil and Gas):
|
||||||||||||
|
Revenues
|
$ | - | $ | 110,089 | $ | - | ||||||
|
Income (Loss) from Operations
|
$ | - | $ | (103,611 | ) | $ | (68 | ) | ||||
Note: Footnotes appear at end of press release.
Contracting Services
|
o
|
Well Intervention revenues increased 16% in the fourth quarter of 2013 from revenues in the third quarter of 2013, primarily due to the strong utilization of the Skandi Constructor. Fourth quarter utilization of the Skandi Constructor was 100%, compared to 38% utilization in the third quarter when the vessel was docked in order to complete final modifications and install the well intervention equipment. Also during the fourth quarter of 2013, the Well Enhancer entered dry dock. On a combined basis, our three North Sea vessels – Seawell, Well Enhancer, Skandi Constructor – achieved 92% utilization in the fourth quarter compared to 78% utilization in the third quarter of 2013. In the Gulf of Mexico, the Q4000 utilization remained unchanged at 100% for the fourth quarter of 2013.
|
|
o
|
For Robotics, chartered vessel fleet utilization decreased to 88% for the quarter compared to 98% in the third quarter of 2013. However, both revenues and gross profit remained flat compared to the third quarter of 2013 due to a 53% increase in utilized trencher days in the fourth quarter of 2013.
|
Other Expenses
|
o
|
Selling, general and administrative expenses were 7.6% of revenue in the fourth quarter of 2013, 10.3% of revenue in the third quarter of 2013 and 12.7% in the fourth quarter of 2012. The decrease in selling, general and administrative expenses in the fourth quarter of 2013 compared to the third quarter of 2013 is primarily attributable to a $2.1 million allowance for doubtful accounts charge that was recorded in the third quarter of 2013.
|
|
o
|
Net interest expense and other decreased to $2.8 million in the fourth quarter of 2013 from $12.8 million in the third quarter of 2013. Net interest expense decreased to $4.6 million in the fourth quarter of 2013 compared to $6.6 million in the third quarter of 2013. The decrease in interest expense reflects the substantial reduction in our average interest rate following the redemption of the remaining $275 million of 9.5% Senior Unsecured Notes outstanding in the third quarter of 2013. Other income was $1.9 million in the fourth quarter compared to $6.2 million of other expense in the third quarter of 2013, which included the $8.6 million loss on early extinguishment of the Senior Unsecured Notes.
|
Financial Condition and Liquidity
|
o
|
Our total liquidity at December 31, 2013 was approximately $1.1 billion, consisting of cash and cash equivalents of $478 million and $584 million in unused capacity under our revolver. Consolidated net debt at December 31, 2013 was $88 million. Net debt to book capitalization at December 31, 2013 was 5%. (Net debt to book capitalization is a non-GAAP measure. See reconciliation below.)
|
|
o
|
We incurred capital expenditures (including capitalized interest) totaling $56 million in the fourth quarter of 2013, compared to $176 million in the third quarter of 2013 and $157 million in the fourth quarter of 2012. For the years ended December 31, 2013 and 2012, capital expenditures totaled $370 million and $497 million, respectively.
|
Footnotes to “Summary of Results”:
|
(1)
|
2012 impairment charges include $157.8 million for the Caesar and related mobile pipelay equipment (Q4), $14.6 million for the Intrepid and $4.6 million for well intervention assets at our former operations in Australia.
|
|
(2)
|
Non-GAAP measure. See reconciliation below.
|
Footnotes to “Segment Information, Operational and Financial Highlights”:
|
(1)
|
Fourth quarter 2012 impairment charges of $157.8 million were for the pending sale of the Caesar and related mobile pipelay equipment.
|
* * * * *
Conference Call Information
Further details are provided in the presentation for Helix’s quarterly conference call to review its fourth quarter 2013 results (see the “Investor Relations” page of Helix’s website, www.HelixESG.com). The call, scheduled for 9:00 a.m. Central Standard Time on Thursday, February 20, 2014, will be audio webcast live from the “Investor Relations” page of Helix’s website. Investors and other interested parties wishing to listen to the conference via telephone may join the call by dialing 800-896-0105 for persons in the United States and +1-212-271-4657 for international participants. The passcode is "Tripodo". A replay of the conference will be available under "Investor Relations" by selecting the "Audio Archives" link from the same page beginning approximately two hours after the completion of the conference call.
About Helix
Helix Energy Solutions Group, headquartered in Houston, Texas, is an international offshore energy company that provides key life of field services to the energy market. For more information about Helix, please visit our website at www.HelixESG.com.
Reconciliation of Non-GAAP Financial Measures
Management evaluates Company performance and financial condition using certain non-GAAP metrics, primarily Adjusted EBITDA from continuing operations, 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 from continuing operations 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 cash 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; 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; 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 Securities and Exchange Commission ("SEC"), including the Company's most recently filed Annual Report on Form 10-K and in the Company’s other filings with the SEC, which are available free of charge on the SEC’s website at www.sec.gov. We assume no obligation and do not intend to update these forward-looking statements except as required by the securities laws.
Social Media
From time to time we provide information about the Company on Twitter (@Helix_ESG) and LinkedIn (www.linkedin.com/company/helix-energy-solutions-group).
HELIX ENERGY SOLUTIONS GROUP, INC.
| Comparative Condensed Consolidated Statements of Operations |
|
|
Three Months Ended Dec. 31,
|
Twelve Months Ended Dec. 31,
|
|||||||||||||||
|
(in thousands, except per share data)
|
2013
|
2012
|
2013
|
2012
|
|||||||||||||
|
|
(unaudited)
|
(unaudited)
|
|||||||||||||||
|
Revenues
|
$ | 226,837 | $ | 201,696 | $ | 876,561 | $ | 846,109 | |||||||||
|
Cost of sales
|
155,673 | 152,670 | 615,876 | 619,059 | |||||||||||||
|
Asset impairment charges
|
- | 157,951 | - | 177,135 | |||||||||||||
|
Gross profit (loss)
|
71,164 | (108,925 | ) | 260,685 | 49,915 | ||||||||||||
|
Loss on commodity derivative contracts
|
- | (10,507 | ) | (14,113 | ) | (10,507 | ) | ||||||||||
|
Gain (loss) on sale of assets
|
- | (543 | ) | 14,727 | (13,476 | ) | |||||||||||
|
Selling, general and administrative expenses
|
(17,224 | ) | (25,661 | ) | (82,265 | ) | (94,415 | ) | |||||||||
|
Income (loss) from operations
|
53,940 | (145,636 | ) | 179,034 | (68,483 | ) | |||||||||||
|
Equity in earnings of investments
|
815 | 887 | 2,965 | 8,434 | |||||||||||||
|
Other income - oil and gas
|
800 | - | 6,581 | - | |||||||||||||
|
Net interest expense and other
|
(2,756 | ) | (11,883 | ) | (44,992 | ) | (65,949 | ) | |||||||||
|
Income (loss) before income taxes
|
52,799 | (156,632 | ) | 143,588 | (125,998 | ) | |||||||||||
|
Income tax provision (benefit)
|
15,534 | (57,753 | ) | 31,612 | (59,158 | ) | |||||||||||
|
Net income (loss) from continuing operations
|
37,265 | (98,879 | ) | 111,976 | (66,840 | ) | |||||||||||
|
Income (loss) from discontinued operations, net of tax
|
- | (71,888 | ) | 1,073 | 23,684 | ||||||||||||
|
Net income (loss), including noncontrolling interests
|
37,265 | (170,767 | ) | 113,049 | (43,156 | ) | |||||||||||
|
Less net income applicable to noncontrolling interests
|
(762 | ) | (800 | ) | (3,127 | ) | (3,178 | ) | |||||||||
|
Net income (loss) applicable to Helix
|
$ | 36,503 | $ | (171,567 | ) | $ | 109,922 | $ | (46,334 | ) | |||||||
|
Weighted Avg. Common Shares Outstanding:
|
|||||||||||||||||
|
Basic
|
105,018 | 104,412 | 105,032 | 104,449 | |||||||||||||
|
Diluted
|
105,159 | 104,412 | 105,184 | 104,449 | |||||||||||||
|
Basic earnings (loss) per share of common stock:
|
|||||||||||||||||
|
Continuing operations
|
$ | 0.35 | $ | (0.95 | ) | $ | 1.03 | $ | (0.67 | ) | |||||||
|
Discontinued operations
|
- | (0.69 | ) | 0.01 | 0.23 | ||||||||||||
|
Net income (loss) per share of common stock
|
$ | 0.35 | $ | (1.64 | ) | $ | 1.04 | $ | (0.44 | ) | |||||||
|
Diluted earnings (loss) per share of common stock:
|
|||||||||||||||||
|
Continuing operations
|
$ | 0.35 | $ | (0.95 | ) | $ | 1.03 | $ | (0.67 | ) | |||||||
|
Discontinued operations
|
- | (0.69 | ) | 0.01 | 0.23 | ||||||||||||
|
Net income (loss) per share of common stock
|
$ | 0.35 | $ | (1.64 | ) | $ | 1.04 | $ | (0.44 | ) | |||||||
| Comparative Condensed Consolidated Balance Sheets |
|
ASSETS
|
LIABILITIES & SHAREHOLDERS' EQUITY
|
||||||||||||||||
|
(in thousands)
|
Dec. 31, 2013
|
Dec. 31, 2012
|
(in thousands)
|
Dec. 31, 2013
|
Dec. 31, 2012
|
||||||||||||
|
(unaudited)
|
(unaudited)
|
||||||||||||||||
|
Current Assets:
|
Current Liabilities:
|
||||||||||||||||
|
Cash and equivalents (1)
|
$ | 478,200 | $ | 437,100 |
Accounts payable
|
$ | 72,602 | $ | 92,398 | ||||||||
|
Accounts receivable
|
184,165 | 186,073 |
Accrued liabilities
|
96,482 | 161,514 | ||||||||||||
|
Current deferred tax assets
|
51,573 | 43,942 |
Income tax payable
|
760 | - | ||||||||||||
|
Other current assets
|
29,709 | 52,992 |
Current mat of L-T debt (1)
|
20,376 | 16,607 | ||||||||||||
|
C-A of discontinued operations
|
- | 84,000 |
C-L of discontinued operations
|
- | 182,527 | ||||||||||||
|
Total Current Assets
|
743,647 | 804,107 |
Total Current Liabilities
|
190,220 | 453,046 | ||||||||||||
|
Property & Equipment
|
1,528,294 | 1,485,875 |
Long-term debt (1)
|
545,776 | 1,002,621 | ||||||||||||
|
Equity investments
|
157,919 | 167,599 |
Deferred tax liabilities
|
265,879 | 359,237 | ||||||||||||
|
Goodwill
|
63,230 | 62,935 |
Other non-current liabilities
|
18,295 | 5,025 | ||||||||||||
|
Other assets, net
|
51,190 | 49,837 |
N-C liabilities of discontinued operations
|
- | 147,237 | ||||||||||||
|
N-C assets of discontinued operations
|
- | 816,227 |
Shareholders' equity (1)
|
1,524,110 | 1,419,414 | ||||||||||||
|
Total Assets
|
$ | 2,544,280 | $ | 3,386,580 |
Total Liabilities & Equity
|
$ | 2,544,280 | $ | 3,386,580 | ||||||||
|
(1) Net debt to book capitalization - 5% at December 31, 2013. Calculated as total debt less cash and equivalents ($87,952)
|
|||||||||||||||||
| divided by sum of total net debt and shareholders' equity ($1,612,062). | |||||||||||||||||
Helix Energy Solutions Group, Inc.
Reconciliation of Non GAAP Measures
Three and Twelve Months Ended December 31, 2013
|
Earnings Release:
|
||||||||||||||||||||
| Reconciliation From Net Income from Continuing Operations to Adjusted EBITDAX: | ||||||||||||||||||||
| 4Q13 | 4Q12 | 3Q13 | 2013 | 2012 | ||||||||||||||||
|
(in thousands)
|
||||||||||||||||||||
|
Net income (loss) from continuing operations
|
$ | 37,265 | $ | (98,879 | ) | $ | 45,348 | $ | 111,976 | $ | (66,840 | ) | ||||||||
|
Adjustments:
|
||||||||||||||||||||
|
Income tax provision (benefit)
|
15,534 | (57,753 | ) | 7,058 | 31,612 | (59,158 | ) | |||||||||||||
|
Net interest expense and other
|
2,756 | 11,883 | 12,791 | 44,992 | 65,949 | |||||||||||||||
|
Depreciation and amortization
|
26,993 | 25,016 | 21,850 | 98,535 | 97,201 | |||||||||||||||
|
Asset impairment charges
|
- | 157,951 | - | - | 177,135 | |||||||||||||||
|
EBITDA
|
82,548 | 38,218 | 87,047 | 287,115 | 214,287 | |||||||||||||||
|
Adjustments:
|
||||||||||||||||||||
|
Noncontrolling interest
|
(999 | ) | (1,039 | ) | (1,037 | ) | (4,077 | ) | (4,128 | ) | ||||||||||
|
Unrealized loss on commodity derivative contracts
|
- | 9,977 | - | - | 9,977 | |||||||||||||||
|
(Gain) loss on sale of assets
|
- | 543 | (15,812 | ) | (14,727 | ) | 13,476 | |||||||||||||
|
Adjusted EBITDA from continuing operations
|
81,549 | 47,699 | 70,198 | 268,311 | 233,612 | |||||||||||||||
|
Adjusted EBITDAX from discontinued operations (1) (2)
|
- | 65,528 | - | 31,754 | 367,216 | |||||||||||||||
|
Adjusted EBITDAX
|
$ | 81,549 | $ | 113,227 | $ | 70,198 | $ | 300,065 | $ | 600,828 | ||||||||||
|
(1) Amounts relate to ERT which was sold in February 2013.
|
||||||||||||||||||||
|
(2) Reconciliation of Adjusted EBITDAX from discontinued operations:
|
||||||||||||||||||||
| 4Q13 | 4Q12 | 3Q13 | 2013 | 2012 | ||||||||||||||||
|
(in thousands)
|
||||||||||||||||||||
|
Net income (loss) from discontinued operations, net of tax
|
$ | - | $ | (71,888 | ) | $ | 44 | $ | 1,073 | $ | 23,684 | |||||||||
|
Adjustments:
|
||||||||||||||||||||
|
Income tax provision (benefit)
|
- | (38,705 | ) | 24 | 579 | 13,420 | ||||||||||||||
|
Net interest expense and other
|
- | 6,982 | - | 2,732 | 28,191 | |||||||||||||||
|
Depreciation and amortization
|
- | 32,015 | - | 1,226 | 158,284 | |||||||||||||||
|
Asset impairment charges
|
- | 138,628 | - | - | 138,628 | |||||||||||||||
|
Exploration expenses
|
- | 826 | - | 3,514 | 3,295 | |||||||||||||||
|
EBITDAX
|
- | 67,858 | 68 | 9,124 | 365,502 | |||||||||||||||
|
Adjustments:
|
||||||||||||||||||||
|
Unrealized loss on commodity derivative contracts
|
- | (2,330 | ) | - | - | - | ||||||||||||||
|
(Gain) loss on sale of assets
|
- | - | (68 | ) | 22,630 | 1,714 | ||||||||||||||
|
Adjusted EBITDAX from discontinued operations
|
$ | - | $ | 65,528 | $ | - | $ | 31,754 | $ | 367,216 | ||||||||||
|
We calculate adjusted EBITDA from continuing operations as earnings before net interest expense and other, taxes and 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.
|
||||||||||||||||||||
Helix Energy Solutions Group, Inc.
Reconciliation of Non GAAP Measures
Twelve Months Ended December 31, 2013
|
Earnings Release:
|
||||
|
Reconciliation of significant items:
|
||||
| 3Q13 | ||||
|
(in thousands, except earnings per share data)
|
||||
|
Nonrecurring items in continuing operations:
|
||||
|
Gain on sale of the Express
|
$ | (15,586 | ) | |
|
Loss on extinguishment of debt
|
8,572 | |||
|
Tax provision of the above
|
2,455 | |||
|
Nonrecurring items in continuing operations, net:
|
$ | (4,559 | ) | |
|
Diluted shares
|
105,136 | |||
|
Net after income tax effect per share
|
$ | (0.04 | ) | |
EXHIBIT 99.2
* Fourth Quarter 2013 Conference Call February 20, 2014
* Forward-Looking Statements This presentation 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; 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; 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 Securities and Exchange Commission ("SEC"), including the Company's most recently filed Annual Report on Form 10-K and in the Company’s other filings with the SEC, which are available free of charge on the SEC’s website at www.sec.gov. We assume no obligation and do not intend to update these forward-looking statements except as required by the securities laws. Social Media From time to time we provide information about the Company on Twitter (@Helix_ESG) and LinkedIn (www.linkedin.com/company/helix-energy-solutions-group).
* Presentation Outline Executive Summary Summary of Q4 2013 Results (pg. 5) Operational Highlights by Segment Contracting Services (pg. 9) Key Balance Sheet Metrics (pg. 13) 2014 Outlook (pg. 16) Non-GAAP Reconciliations (pg. 21) Questions & Answers
* Executive Summary *
* Executive Summary ($ in millions, except per share data) 2012 impairment charges include $157.8 million for the Caesar and related mobile pipelay equipment (Q4), $14.6 million for the Intrepid and $4.6 million for well intervention assets at our former operations in Australia. See non-GAAP reconciliation on slide 21.
* Executive Summary Q4 2013 earnings of $0.35 per diluted share compared to $0.42 per diluted share in Q3 2013 Q3 included a $15.6 million gain on the sale of the Express and an $8.6 million loss on the early extinguishment of debt; both items netted to an after-tax impact of $0.04 per diluted share Contracting Services and Production Facilities 94% utilization of Well Intervention vessels; strong outlook and backlog expected for 2014 and beyond Skandi Constructor (chartered vessel) mobilized to offshore West Africa in Q4; approximately 60 day campaign commenced mid-January 2014 Robotics long-term chartered fleet utilization of 88% utilization in Q4; all four trenchers active in the fourth quarter Completed 46 day regulatory dry dock of the Helix Producer I and returned to service mid-November 2013 Completed 47 day regulatory dry dock of the Well Enhancer and returned to service late January 2014 Helix 534 commenced operations in the Gulf of Mexico in mid-February 2014 Signed agreement with Petróbras to provide well intervention services offshore Brazil, commencing in 2016
* Executive Summary Balance sheet Cash and cash equivalents totaled $478 million at 12/31/2013 Liquidity* of $1.1 billion at 12/31/2013 Net debt of $88 million at 12/31/2013 See updated debt maturity profile on slide 14 We define liquidity as the total of cash and cash equivalents ($478 million) plus unused capacity under our revolving credit facility ($584 million).
* Operational Highlights *
* ($ in millions, except percentages) See non-GAAP reconciliation on slide 24. Amounts are prior to intercompany eliminations. Before gross profit impact of $157.8 million in asset impairments for the Caesar and related mobile pipelay equipment in Q4 2012. 94% utilization for the Well Intervention fleet Skandi Constructor mobilized for operations off the coast of West Africa 88% chartered vessel utilization in Robotics Helix Producer I completed dry dock and returned to service mid-November 2013 Well Enhancer completed dry dock and returned to service January 2014 Contracting Services ROV onboard the Siem Daya I
* GOM Q4000 fully utilized during Q4 IRS no. 2 on hire for the entire quarter; working at operational rates beginning late November through the end of the Q4 Helix 534 commenced operations in the Gulf of Mexico in mid-February 2014 with full backlog for the remainder of the year; backlog beyond 2014, and extending into 2017 North Sea Full utilization of Seawell and Skandi Constructor during Q4 on a variety of well intervention projects Well Enhancer fully utilized prior to entering dry dock in mid-December; returned to service late January 2014 Skandi Constructor departed UK mid-December for a well intervention campaign offshore Africa All vessels with high backlog in Q1 through Q3 2014, offshore UK, Canada and Africa; limited availability in Q4 2014 Contracting Services – Well Intervention The SIL system
* 88% long-term chartered vessel fleet utilization in Q4 69% utilization for ROVs, trenchers and ROVDrill Olympic Canyon continued operations in India at 100% utilization for the quarter REM Installer completed accommodations project in the North Sea, then transited to the Gulf of Mexico to commence ROV services campaign Deep Cygnus utilized T750 trencher on various trenching projects in the North Sea Grand Canyon performed ROV and trenching projects in the North Sea utilizing T1200 and iTrencher Olympic Triton achieved 95% utilization on a ROVDrill campaign offshore West Africa Extended existing multi-ROV services contract in Malaysia through January 2015 Awarded trenching campaign in the Middle East onboard the Grand Canyon during Q1 and Q2 2014 Contracting Services – Robotics The Grand Canyon
* Olympic Canyon (1) Deep Cygnus (1) Olympic Triton (1) Grand Canyon (1) REM Installer (1) Seawell Well Enhancer Q4000 Skandi Constructor (1) 51 ROVs 2 ROVDrill Units 4 Trenchers (1) Chartered vessel Contracting Services Utilization
* Key Balance Sheet Metrics *
* Total funded debt of $593 million at end of Q4 2013: $200 million Convertible Senior Notes – 3.25% (A) ($173 million net of unamortized debt discount) $293 million Term Loan – LIBOR + 2.75% (B) Annual amortization payments of 5% in years 1 and 2, 10% per annum in years 3 through 5 $100 million MARAD Debt – 4.93% Semi-annual amortization payments Debt Maturity Profile Convertible Notes Term Loan MARAD Debt Stated maturity 2032. First put / call date – March 2018. We have fixed the LIBOR interest rate on 50% of the Term Loan debt at 0.75%, utilizing interest rate swaps, through October 2016.
* Liquidity of approximately $1.1 billion at 12/31/2013 ($ amounts in millions) Includes impact of unamortized debt discount under our convertible senior notes. We define liquidity as the total of cash and cash equivalents ($478 million) plus unused capacity under our revolving credit facility ($584 million). Debt and Liquidity Profile
* 2014 Outlook *
* 2014 Outlook ($ in millions) Earnings per share estimates based on a corporate tax rate ranging from 25% - 30%.
* 2014 Outlook Contracting Services backlog as of December 31, 2013 was approximately $1.8 billion; total backlog of approximately $2.0 billion including Production Facilities Utilization expected to remain strong for the well intervention fleet Q4000 backlog through 2015; negotiations ongoing to extend commitments into 2017 Q5000 backlog currently a minimum of 270 days annually over first 5 years of operations Helix 534 has full backlog through 2016 and extending into 2017 Well Enhancer and Seawell have high levels of backlog in 2014 and extending into 2015 Seawell re-fit dry dock expected to commence in December 2014 Skandi Constructor nearly full backlog in 2014, with commitments into 2015 Vessel operating offshore Africa for Q1 2014, with new business commitments in Canada and West of Shetland Q2/Q3 2014 Skandi Constructor scheduled for ~30 day dry dock in December
* 2014 Outlook Robotics business entering 2014 with a healthy, growing backlog (14% increase in backlog from Q3 to Q4 2013) Europe and Middle East trenching markets expected to be strong; similar to 2012 Multi-trencher burial campaign onboard the Grand Canyon I in the Middle East during Q1 and Q2 2014 Mobilizing two new work class ROVs onboard client’s vessel to commence 5-year ROV services contract beginning Q1 2014 “Walk-to-work” accommodations project in the North Sea utilizing the REM Installer commencing March 2014 for approximately six months Grand Canyon II vessel expected to enter Robotics long-term chartered fleet late 2014
* 2014 Outlook – Capex Total capital expenditures currently budgeted at approximately $400 million in 2014 Growth capital of approximately $320 million, including: Approximately $160 million for the Q5000 and intervention riser system Approximately $30 million for the Q7000 and intervention riser system Approximately $50 million for the two monohull intervention vessels going to Brazil in 2016 for Petróbras award ROVs, T1500 jet trencher Maintenance capital of approximately $55 million, including: Approximately $40 million in dry dock costs, including the Seawell life extension expected to begin December 2014 Robotics, IRS / SIL maintenance Helix Producer I engines Approximately $21 million for the Helix Producer I minority interest buyout
* Non-GAAP Reconciliations *
* Non-GAAP Reconciliations ($ in millions) We calculate Adjusted EBITDA from continuing operations as earnings before net interest expense and other, taxes, depreciation and amortization. Adjusted EBITDAX is Adjusted EBITDA from continuing operations plus the earnings of our former oil and gas business before net interest expense and other, taxes, depreciation and amortization, and exploration expense. These non-GAAP measures are useful to investors and other internal and external users of our financial statements in evaluating our operating performance; 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 from continuing operations and Adjusted EBITDAX should not be considered in isolation or as a substitute for, but instead is supplemental to, income from operations, net income and 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 from this measure.
* Non-GAAP Reconciliations We calculate Adjusted EBITDA from continuing operations as earnings before net interest expense and other, taxes, depreciation and amortization. Adjusted EBITDAX is Adjusted EBITDA from continuing operations plus the earnings of our former oil and gas business before net interest expense and other, taxes, depreciation and amortization, and exploration expense. These non-GAAP measures are useful to investors and other internal and external users of our financial statements in evaluating our operating performance; 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 from continuing operations and Adjusted EBITDAX should not be considered in isolation or as a substitute for, but instead is supplemental to, income from operations, net income and 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 from this measure. ($ in millions)
* Non-GAAP Reconciliations ($ in millions)
* Follow Helix on Twitter: @Helix_ESG Join the discussion on LinkedIn: www.linkedin.com/company/helix