SEACOR Holdings Announces First Quarter Results
HOUSTON--(BUSINESS WIRE)--May 3, 2004--SEACOR Holdings Inc. (NYSE:CKH) announced a net loss for the first quarter ended March 31, 2004 of $3.0 million, or $0.16 per diluted share, on operating revenues of $96.0 million. For the comparable quarter ended March 31, 2003, net earnings were $4.3 million, or $0.22 per diluted share, on operating revenues of $96.9 million.
For the immediately preceding quarter ended December 31, 2003, the Company reported a net loss of $1.7 million, or $0.09 per diluted share, on operating revenues of $101.0 million.
Financial results for the first quarter ended March 31, 2004 as compared to the immediately preceding quarter ended December 31, 2003 were impacted by a variety of factors highlighted below.
-- Decreased operating revenues. Operating revenues for the quarter were $96.0 million, a decrease of $5.0 million from the previous quarter. Offshore Marine Services revenue declined primarily due to a decrease in the size of its fleet and weaker demand for certain classes of its vessels. Inland River Services revenue declined primarily due to less activity, which is typical of the winter months when part of the inland river system is shut down. These declines were partially offset by higher Environmental Services revenue due to an increase in spill response activity.
-- Increased operating loss. Operating loss for the quarter was $8.1 million, an increase of $0.3 million over the prior quarter. Overall reductions in operating and administrative expenses were not sufficient to offset the decline in revenues from Inland River Services and Offshore Marine Services. Operating losses from the Company's aviation and supply chain management operations, included under "Other" in the Company's segmented financials, also increased during the quarter. Environmental Services operating income was generally unchanged between quarters.
-- Decreased income from equipment sales. Equipment sale income of $3.6 million for the quarter decreased $6.0 million from the prior quarter as a result of fewer vessel sales.
-- Increased income from derivative transactions. During the quarter the Company realized $0.1 million of gains compared to a loss of $1.5 million in the fourth quarter. Prior quarter results included a $1.5 million loss with respect to swap agreements on certain of the Company's 7.2% notes. These swap agreements were terminated in the fourth quarter.
-- Decreased foreign currency transaction gains. Foreign currency transaction gains of $0.5 million decreased $3.2 million. In both periods, foreign currency transaction gains resulted primarily from the strengthening of the pound sterling currency against the U.S. dollar with respect to an intercompany loan with a foreign subsidiary.
-- Increased marketable security sale gains. Marketable security sale gains of
$2.7 million for the quarter increased $2.0 million from the prior quarter.
-- Decreased income tax rate. Results for the fourth quarter included a $1.9 million charge in connection with valuation allowances provided for foreign tax credits which may expire before utilization. During the first quarter, no additional valuation allowances were provided.
-- Increased equity earnings. During the quarter the Company realized equity income of $0.6 million as compared to a loss of $0.1 million in the prior quarter. The effect on income of improved offshore marine joint venture business activities in Mexico and Venezuela was partially offset by a $0.5 million first quarter write-down in the carrying value of one of the Company's investments.
First quarter results included the drydock and repair of 20 vessels for an aggregate cost of $2.9 million and the overhaul of 24 engines resulting in main engine repair costs of $3.0 million.
During the quarter, Offshore Marine Services sold 12 vessels with a carrying value of $2.8 million, including 9 from its "retired from service" utility fleet. During the quarter, 1 towing supply vessel and 1 geophysical vessel were added to its "retired from service" fleet. As of March 31, 2004, a total of 19 vessels were retired from service and 9 additional vessels were out of service due to weak customer demand.
During the quarter, 2 new offshore support vessels, 22 new dry cargo covered hopper barges and 1 new helicopter were delivered to the Company for aggregate consideration of $33.0 million.
The Company's remaining capital commitments at March 31, 2004 for 7 new and 1 used vessel, 308 new dry cargo hopper barges, 24 new chemical tank barges and 3 new helicopters totaled $128.0 million, with deliveries expected throughout 2004. The Company also holds options to purchase 150 new dry cargo hopper barges for delivery in 2005.
During the quarter, the Company acquired 99,057 shares of its common stock for treasury at an aggregate cost of $4.1 million pursuant to a stock and debt repurchase plan. As of March 31, 2004, $54.1 million of authority remains available for future purchases of SEACOR's stock and 5-7/8% and 7.2% notes.
At March 31, 2004, the Company's cash, marketable securities and construction reserve funds totaled $441.5 million, an increase of $3.4 million from the prior quarter. At March 31, 2004, the Company's long-term debt totaled $332.2 million, unchanged as compared to the prior quarter.
SEACOR and its subsidiaries are engaged in the operation of a diversified fleet of offshore support vessels that service oil and gas exploration and development activities in the U.S. Gulf of Mexico, the North Sea, West Africa, Asia, Latin America and other international regions. Other business activities primarily include environmental services, inland river operations, and offshore aviation services.
This release includes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements concerning management's expectations, strategic objectives, business prospects, anticipated economic performance and financial condition and other similar matters involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of results to differ materially from any future results, performance or achievements discussed or implied by such forward-looking statements. Such risks, uncertainties and other important factors include, among others: the cyclical nature of the oil and gas industry, adequacy of insurance coverage, currency exchange fluctuations, changes in foreign political, military and economic conditions, the ongoing need to replace aging vessels, dependence of offshore marine operations on several customers, dependence of spill response revenue on the number and size of spills and upon continuing government regulation in this area and our ability to comply with such regulation and other governmental regulation, industry fleet capacity, changes in foreign and domestic oil and gas exploration and production activity, competition, vessel-related risks, effects of adverse weather conditions and seasonality on aviation services, helicopter related risks, effects of adverse weather and river conditions and seasonality on inland river operations, the level of grain export volume, the effect of fuel prices on barge towing costs, variability in freight rates for inland river barges, changes in the Company's environmental services segment OSRO classification, liability in connection with providing spill response services, restrictions imposed by the Shipping Act of 1916 and the Merchant Marine Act of 1920 on the amount of foreign ownership of the Company's common stock, the effect of international economic and political factors in inland river operations and various other matters, many of which are beyond the Company's control and other factors. The words "estimate," "project," "intend," "believe," "plan" and similar expressions are intended to identify forward-looking statements. Forward-looking statements speak only as of the date of the document in which they are made. We disclaim any obligation or undertaking to provide any updates or revisions to any forward-looking statement to reflect any change in our expectations or any change in events, conditions or circumstances on which the forward-looking statement is based. The forward-looking statements in this release should be evaluated together with the many uncertainties that affect our businesses, particularly those mentioned under "Forward-Looking Statements" in Item 7 of our Form 10-K and SEACOR's periodic reporting on Form 10-Q and Form 8-K (if any), which we incorporate by reference.
SEACOR Holdings Inc. and Subsidiaries Consolidated Statements of Operations (in thousands, except per share data, unaudited) Three Months Ended March 31, ---------------- 2004 2003 -------- ------- Operating Revenues $ 95,974 $96,860 -------- ------- Costs and Expenses: Operating expenses 75,030 67,100 Administrative and general 15,076 14,079 Deprecation and amortization 13,961 14,636 -------- ------- 104,067 95,815 -------- ------- Operating Income (Loss) (8,093) 1,045 -------- ------- Other Income (Expense): Interest income 1,379 2,556 Interest expense (5,378) (5,506) Debt extinguishments - (1,125) Income from equipment sales or retirements, net 3,638 5,147 Derivative income (loss), net 79 1,749 Foreign currency transaction gains, net 466 535 Marketable securities sale gains, net 2,749 2,191 Other, net 119 3 -------- ------- 3,052 5,550 -------- ------- Income (Loss) Before Taxes, Minority Interest and Equity in Earnings of 50% or Less Owned Companies (5,041) 6,595 Income Taxes (1,502) 2,399 -------- ------- Income (Loss) Before Minority Interest and Equity in Earnings of 50% or Less Owned Companies (3,539) 4,196 Minority Interest in Net (Income) Loss of Subsidiaries 5 (98) Equity in Earnings of 50% or Less Owned Companies 570 246 -------- ------- Net Income (Loss) $ (2,964)$ 4,344 ======== ======= Earnings Per Common Share: Basic $ (0.16)$ 0.22 Diluted (1) (0.16) 0.22 Weighted Average Common Shares Outstanding: Basic 18,468 19,775 Diluted (1) 18,468 20,362 (1) Outstanding stock options and restricted stock have been excluded from the computations of diluted earnings per common share and diluted weighted average common shares for the three months ended March 31, 2004 as the effect was anti-dilutive. SEACOR Holdings Inc. and Subsidiaries Supplemental Data (in thousands, except per share data, unaudited) Three Months Ended ------------------------------------------- Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31, 2004 2003 2003 2003 2003 -------- -------- -------- -------- --------- Statements of Operations: Operating Revenues $ 95,974 $100,956 $103,234 $105,159 $96,860 -------- -------- -------- -------- ------- Cost and Expenses: Operating expenses 75,030 78,504 72,264 69,422 67,100 Administrative and general 15,076 16,538 13,676 13,391 14,079 Depreciation and amortization 13,961 13,751 13,411 13,708 14,636 -------- -------- -------- -------- ------- 104,067 108,793 99,351 96,521 95,815 -------- -------- -------- -------- ------- Operating Income (Loss) (8,093) (7,837) 3,883 8,638 1,045 -------- -------- -------- -------- ------- Other Income (Expense): Interest income 1,379 1,565 1,540 1,870 2,556 Interest expense (5,378) (4,785) (4,603) (4,419) (5,506) Debt extinguishments - - - (966) (1,125) Income from equipment sales or retirements, net 3,638 9,612 2,349 414 5,147 Derivative income (loss), net 79 (1,541) (443) 2,624 1,749 Foreign currency transaction gains (losses), net 466 3,625 (1,714) 1,294 535 Marketable securities gains, net 2,749 743 2,411 1,250 2,191 Other, net 119 106 (15) (747) 3 -------- -------- -------- -------- ------- 3,052 9,325 (475) 1,320 5,550 -------- -------- -------- -------- ------- Income (Loss) Before Taxes, Minority Interest and Equity Earnings in 50% or Less Owned Companies (5,041) 1,488 3,408 9,958 6,595 Income Taxes (1,502) 3,067 1,334 3,596 2,399 -------- -------- -------- -------- ------- Income (Loss) Before Minority Interest and Equity Equity in 50% or Less Owned Companies (3,539) (1,579) 2,074 6,362 4,196 Minority Interest in Net (Income) Loss of Subsidiaries 5 (66) (112) (241) (98) Equity in Earnings of 50% or less Owned Companies 570 (85) 935 322 246 -------- -------- -------- -------- ------- Net Income (Loss) $ (2,964)$ (1,730)$ 2,897 $ 6,443 $ 4,344 ======== ======== ======== ======== ======= Earnings Per Common Share: Basic $ (0.16)$ (0.09)$ 0.16 $ 0.34 $ 0.22 Diluted(1) (0.16) (0.09) 0.15 0.33 0.22 Weighted Average Common Shares Outstanding: Basic 18,468 18,509 18,630 19,155 19,775 Diluted(1) 18,468 18,509 18,785 19,316 20,362 Common Shares Outstanding at Period End 18,533 18,581 18,729 18,793 19,615 (1) Outstanding stock options and restricted stock have been excluded from the computation of diluted earnings per common share and diluted weighted average common shares for each of the three month periods ended March 31, 2004 and December 31, 2003 as the effect was anti-dilutive. SEACOR Holdings Inc. and Subsidiaries Supplemental Data (unaudited) Three Months Ended ------------------------------------------------------- Mar. 31, Dec. 31, Sep. 30, Jun. 30, Mar. 31, 2004 2003 2003 2003 2003 ---------- ---------- ---------- ---------- ----------- Balance Sheet Data, at period end (in thousands): Cash, Securities, Construction Reserve Funds $ 441,502 $ 438,131 $ 428,372 $ 431,796 $ 498,075 Total Assets 1,401,426 1,402,611 1,370,630 1,379,700 1,401,710 Total Long- term Debt 332,225 332,179 332,213 332,187 343,058 Stockholders' Equity 766,529 770,446 768,530 772,563 789,971 Operating Revenues by Segment (in thousands): Offshore marine services $ 66,292 $ 74,262 $ 81,194 $ 79,553 $ 81,107 Environmental services 16,392 11,732 10,625 15,551 6,137 Inland river services 8,576 10,728 7,247 5,044 4,840 Other 6,705 5,328 4,803 5,422 5,187 Intersegment eliminations (1,991) (1,094) (635) (411) (411) ---------- ---------- ---------- ---------- --------- $ 95,974 $ 100,956 $ 103,234 $ 105,159 $ 96,860 ========== ========== ========== ========== ========= Operating Income (Loss) by Segment (in thousands): Offshore marine services $ (4,378)$ (5,652)$ 3,432 $ 5,286 $ 3,312 Environmental services 957 894 3,419 5,131 (399) Inland river services 943 2,523 970 1,156 884 Other (2,610) (1,893) (1,122) (156) (146) Corporate expenses (3,005) (3,709) (2,816) (2,779) (2,606) ---------- ---------- ---------- ---------- --------- $ (8,093)$ (7,837)$ 3,883 $ 8,638 $ 1,045 ========== ========== ========== ========== ========= Offshore Marine Vessels - Available Days(1): Anchor handling towing supply - Domestic 304 460 460 455 450 Foreign 724 890 1,012 1,001 1,058 Supply - Domestic 790 831 920 1,026 1,260 Foreign 910 1,061 1,104 995 931 Towing - Domestic 273 184 184 253 304 Foreign 1,026 1,095 1,196 1,140 1,245 Crew 6,188 6,321 6,699 6,654 6,843 Geophysical, freight and other 91 92 92 91 90 Mini-supply 2,730 2,760 2,760 2,730 2,700 Standby safety 1,911 1,871 1,840 1,820 1,818 Utility - 2,581 3,253 3,417 3,428 ---------- ---------- ---------- ---------- --------- 14,947 18,146 19,520 19,582 20,127 ========== ========== ========== ========== ========= (1) Excludes vessels that are bareboat chartered-out, vessels owned by corporations that participate in pooling arrangements with the Company, minority owned joint venture vessels and managed vessels. SEACOR Holdings Inc. and Subsidiaries Supplemental Data (unaudited) Three Months Ended --------------------------------------- Mar. Dec. Sep. Jun. Mar. 31, 31, 30, 30, 31, 2004 2003 2003 2003 2003 ------- ------- ------- ------- ------- Offshore Marine Vessels - Rates Per Day Worked: Anchor handling towing supply - Domestic $15,888 $22,111 $20,095 $16,712 $17,668 Foreign 8,524 9,212 9,927 10,593 10,110 Supply - Domestic 6,300 6,079 6,062 6,141 6,957 Foreign 9,067 8,860 8,926 9,615 9,443 Towing - Domestic 6,055 6,091 6,093 6,290 6,424 Foreign 6,586 6,577 7,236 7,050 7,146 Crew 3,297 3,323 3,257 3,153 3,158 Geophysical, freight and other - - - - - Mini-supply 2,976 2,992 2,998 3,027 3,102 Standby safety 7,694 6,933 6,733 6,559 6,537 Utility - 1,752 1,774 1,792 1,767 Offshore Marine Vessels - Utilization: Anchor handling towing supply - Domestic 68.2% 56.2% 65.9% 66.8% 67.9% Foreign 61.5% 72.8% 81.9% 81.2% 88.9% Supply - Domestic 71.7% 50.5% 72.7% 58.4% 62.5% Foreign 73.4% 86.1% 88.7% 93.9% 95.7% Towing - Domestic 56.7% 100.0% 100.0% 97.1% 94.3% Foreign 67.4% 75.0% 82.7% 88.2% 82.0% Crew 82.8% 78.5% 75.9% 79.9% 78.9% Geophysical, freight and other - - - - - Mini-supply 81.7% 86.3% 91.6% 89.4% 86.8% Standby safety 87.0% 90.3% 89.9% 89.5% 81.6% Utility - 52.4% 58.7% 56.7% 55.1% Overall utilization 78.6% 75.1% 77.5% 77.8% 76.2% Inland Barge Days(1) 44,929 44,219 37,648 25,571 23,063 Helicopter Flight Hours 5,750 5,422 5,131 5,889 5,061 (1) Excludes barges managed by and joint ventured with the Company. SEACOR Holdings Inc. and Subsidiaries Supplementary Data (unaudited) March 31, 2004 ---------------------------------------------------- Joint Pooled/ Owned Leased-in Ventured Managed ---------------------------------------------------- Offshore Marine Fleet Count: Domestic - Anchor handling towing supply 1 2 1 - Crew 29 23 1 - Geophysical, freight and other - - - - Mini-supply 23 4 - - Standby safety - - - - Supply 4 3 2 1 Towing - 2 - - Utility - - - - ---------------------------------------------------- 57 34 4 1 ---------------------------------------------------- Foreign - Anchor handling towing supply 13 - 2 - Crew 22 - 11 - Geophysical, freight and other 1 - 1 - Mini-supply 3 - 2 - Standby safety 19 - 3 5 Supply 8 2 5 - Towing 13 - 22 - Utility - - - - ---------------------------------------------------- 79 2 46 5 ---------------------------------------------------- Worldwide - Anchor handling towing supply 14 2 3 - Crew 51 23 12 - Geophysical, freight and other 1 - 1 - Mini-supply 26 4 2 - Standby safety 19 - 3 5 Supply 12 5 7 1 Towing 13 2 22 - Utility - - - - ---------------------------------------------------- 136 36 50 6 ==================================================== Inland Barges, domestic 382 180 6 224 ==================================================== Helicopters, domestic 23 18 - 1 ==================================================== -------------------------------- Dec. Sep. Jun. Mar. 31, 30, 30 31 Total 2003 2003 2003 2003 ---------------------------------------------------- Offshore Marine Fleet Count: Domestic - Anchor handling towing supply 4 6 5 5 5 Crew 53 53 57 60 62 Geophysical, freight and other - 1 1 1 1 Mini-supply 27 27 28 28 29 Standby safety - - - - - Supply 10 11 13 13 17 Towing 2 - - - - Utility - - 34 37 38 ---------------------------------------------------- 96 98 138 144 152 ---------------------------------------------------- Foreign - Anchor handling towing supply 15 20 21 20 21 Crew 33 34 33 32 30 Geophysical, freight and other 2 3 1 1 1 Mini-supply 5 5 4 4 3 Standby safety 27 27 26 26 26 Supply 15 48 54 53 52 Towing 35 - - - - Utility - - 2 3 3 ---------------------------------------------------- 132 137 141 139 136 ---------------------------------------------------- Worldwide - Anchor handling towing supply 19 26 26 25 26 Crew 86 87 90 92 92 Geophysical, freight and other 2 4 2 2 2 Mini-supply 32 32 32 32 32 Standby safety 27 27 26 26 26 Supply 25 59 67 66 69 Towing 37 - - - - Utility - - 36 40 41 ---------------------------------------------------- 228 235 279 283 288 ==================================================== Inland Barges, domestic 792 784 735 559 562 ==================================================== Helicopters, domestic 42 40 36 36 36 ====================================================