SEACOR Holdings Announces Fourth Quarter Results
FORT LAUDERDALE, Fla., Feb. 27 /PRNewswire-FirstCall/ -- SEACOR Holdings Inc. announced net income for the fourth quarter ended December 31, 2005 of $106.5 million, or $3.76 per diluted share, on operating revenue of $334.1 million. For the twelve months ended December 31, 2005, net income was $170.7 million, or $6.95 per diluted share, on operating revenue of $972.0 million.
Results for the fourth quarter ended December 31, 2005 included an income tax benefit of $6.3 million, primarily the result of a $46.2 million benefit, or $1.61 per diluted share, relating to the repatriation of foreign earnings under the provisions of the American Jobs Creation Act of 2004.
For the fourth quarter ended December 31, 2004, net income was $19.3 million, or $1.03 per diluted share, on operating revenue of $182.0 million. For the twelve months ended December 31, 2004, net income was $19.9 million, or $1.08 per diluted share, on operating revenue of $491.9 million.
For the immediately preceding quarter ended September 30, 2005, the Company reported net income of $20.5 million, or $0.76 per diluted share, on operating revenue of $294.9 million.
Charles Fabrikant, Chairman of the Board, commented "I am pleased to announce our results for the fourth quarter of 2005. All of our business segments enjoyed a positive end to the year. In the fourth quarter of 2004 our businesses generated $23 million of operating income on revenue of $182 million. Today, one year later, we are reporting operating income for the final quarter of $90 million on revenue of $334 million. This represents a $67 million increase."
Mr. Fabrikant added, "Calendar year 2005, which included the integration of our July 2005 acquisition of Seabulk International Inc. and our December 2004 acquisition of Era Aviation Inc., was a challenging and exciting year for SEACOR. Those acquisitions, coupled with continued growth in our other business segments, led to operating income for 2005 of $177 million compared to $29 million for 2004 -- a significant year-over-year increase."
Highlights for the Quarter
Offshore Marine Services -- Operating income(1) in the fourth quarter was $54.4 million on operating revenue of $168.8 million compared to $26.9 million on operating revenue of $146.8 million in the third quarter. Fourth quarter results included $6.6 million in gains on asset sales and impairments compared to $0.9 million in losses in the third quarter.
Average day-rates increased in most markets but most noticeably in the Gulf of Mexico where demand for all classes of equipment was consistently strong throughout the quarter in response to increased drilling activity and continuing re-construction work following the summer hurricanes.
Inland River Services -- Operating income in the fourth quarter was $18.0 million on operating revenue of $40.7 million compared to operating income of $8.7 million on operating revenue of $29.7 million in the third quarter, an increase of $9.3 million.
The Company experienced strong demand and higher rates in the fourth quarter in response to hurricane related logistics and the seasonal impact of the grain harvest.
Environmental Services -- Operating income in the fourth quarter was $10.4 million on operating revenue of $37.6 million compared to operating income of $4.6 million on operating revenue of $27.5 million in the third quarter. Approximately $6.4 million of fourth quarter operating income and $12.7 million of operating revenue were generated as a result of emergency response activities.
Aviation Services -- Operating income in the fourth quarter was $10.2 million on operating revenue of $38.9 million compared to operating income of $5.9 million on operating income of $43.9 million in the third quarter. Fourth quarter results included $7.0 million in gains on asset sales as compared to $0.3 million of gains in the third quarter.
The reduction in operating revenue between quarters was primarily due to seasonal affects on contract operations for Alaskan flightseeing operations andfirefighting activity in the Western United States, neither of which was active in the fourth quarter. The decrease in operating revenue from these operations was partially offset by an increase in operating revenue in the Gulf of Mexico driven by higher demand for all classes of equipment in theaftermath of the summer hurricanes.
Operating income was also negatively impacted by a $1.6 million reserve resulting from the bankruptcy of a large customer of the Company's fixed base operations in Alaska.
Marine Transportation Services -- Operating income in the fourth quarter was $6.4 million on operating revenue of $36.6 million compared to an operating loss of $1.3 million on operating revenue of $35.7 million in the third quarter. The improvement in operating income was primarily due to a reduction in costs and expenses in the fourth quarter. In the third quarter two vessels were dry-docked at a cost of $6.7 million. There were no dry- dockings in the fourth quarter.
Derivative income (loss), net -- Derivative transactions, primarily consisting of interest rate swaps and foreign currency contracts, resulted in losses of $0.9 million in the fourth quarter as compared to losses of $4.4 million in the third quarter.
Foreign Currency Translation -- Foreign currency transaction gains were $16.9 million in the fourth quarter compared to gains of $2.4 million in the third quarter. As part of the fourth quarter repatriation of foreign earnings under the American Jobs Creation Act of 2004, the Company recognized a $16.4 million foreign currency gain relating to the revaluation of certain British Pound denominated assets. Following the payment of dividends, the subsidiaries that owned these assets were deemed to be substantially liquidated and the accumulated currency translation adjustment previously reported in stockholders' equity was reclassified to foreign currency translation gains.
Marketable Security Transactions -- Marketable security and short sale transactions resulted in gains of $3.0 million in the fourth quarter as compared to gains of $10.4 million in the third quarter.
Capital Commitments -- The Company's unfunded capital commitments as of December 31, 2005 consisted primarily of marine service vessels, helicopters and barges and totaled $534.6 million, of which $447.6 million is payable in 2006 and 2007, with the remaining balance payable through 2009. Of these commitments, approximately $111.0 million may be terminated without further liability other than the payment of liquidated damages of $1.7 million in the aggregate. Subsequent to the end of year, the Company committed to purchase additional equipment, primarily barges, tugs and a crew boat in the aggregate amount of $51.7 million. As of December 31, 2005 the Company held balances of Cash, Restricted Cash, Securities, Construction Reserve Funds and Title XI Reserve Funds totaling $684.5 million.
(1) See attached schedule "OPERATING INCOME BY LINE OF BUSINESS" for components of operating income.
SEACOR is a global provider of marine support and transportation services, primarily to the energy and chemical industries. SEACOR and its subsidiaries provide customers with a full suite of marine-related services including offshore services, U.S. coastwise shipping, inland river services,helicopter services, environmental services, and offshore and harbor towing services. SEACOR is focused on providing highly responsive local service, combined with the highest safety standards, innovative technology, modern efficient equipment, and dedicated, professional employees.
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, the operation of Offshore Marine Services and Helicopter Services in a highly competitive environment, changes in foreign political, military and economic conditions, the dependence of Offshore Marine Services and Helicopter Services on several customers, industry fleet capacity, the ongoing need to replace aging vessels, restrictions imposed by the Shipping Acts and Aviation Acts on the amount of foreign ownership of the Company's Common Stock, safety record requirements related to Offshore Marine Services and Helicopter Services, changes in foreign and domestic oil and gas exploration and production activity, vessel and helicopter-related risks of Offshore Marine Services and Helicopter Services, effects of adverse weather conditions and seasonality on Helicopter Services, 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, changes in NRC's OSRO classification, 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, liability in connection with providing spill response services, the effect of international economic and political factors in inland river operations, the intense competition faced by Inland River Services, adequacy of insurance coverage, currency exchange fluctuations, the attraction and retention of qualified personnel by the Company, 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. For additional information, contact Timothy McKeand, Vice President, at (954) 524-4200 ext. 820 or visit SEACOR's website at http://www.seacorholdings.com/ .
SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data, unaudited) Three Months Ended Twelve Months Ended December 31, December 31, 2005 2004 2005 2004 Operating Revenue $334,119 $181,997 $972,004 $491,860 Costs and Expenses: Operating expenses 177,012 126,240 589,928 354,163 Administrative and general 36,256 17,592 105,195 61,425 Depreciation and amortization 44,405 15,365 127,714 57,834 257,673 159,197 822,837 473,422 Gains on Asset Sales and Impairments 13,575 598 28,285 10,234 Operating Income 90,021 23,398 177,452 28,672 Other Income (Expense): Interest income 6,284 3,200 19,201 8,422 Interest expense (16,470) (6,154) (48,152) (22,485) Derivative income (loss), net (881) 1,787 (7,074) 1,166 Foreign currency transaction gains (losses), net 16,895 1,944 23,183 1,537 Marketable securities sale gains (losses), net 2,957 1,689 28,081 6,435 Other, net 176 108 1,707 539 8,961 2,574 16,946 (4,386) Income from Continuing Operations Before Income Tax Expense (Benefit), Minority Interest in (Income) Loss of Subsidiaries and Equity In Earnings of 50% or Less Owned Companies 98,982 25,972 194,398 24,286 Income Tax Expense (Benefit) (6,336) 8,395 29,746 8,573 Income from Continuing Operations Before Minority Interest in (Income) Loss of Subsidiaries and Equity in Earnings of 50% or Less Owned Companies 105,318 17,577 164,652 15,713 Minority Interest in (Income) Loss of Subsidiaries (71) (289) 32 (483) Equity in Earnings of 50% or Less Owned Companies 1,250 2,028 5,661 4,659 Income from Continuing Operations 106,497 19,316 170,345 19,889 Income from Discontinued Operations, net of $196 in income tax expense -- -- 364 -- Net Income $106,497 $ 19,316 $170,709 $ 19,889 Basic Earnings Per Common Share: Income from Continuing Operations $ 4.28 $ 1.06 $ 7.89 $ 1.09 Income from Discontinued Operations -- -- 0.02 -- Net Income $ 4.28 $ 1.06 $ 7.91 $ 1.09 Diluted Earnings Per Common Share: Income from Continuing Operations $ 3.76 $ 1.03 $ 6.93 $ 1.08 Income from Discontinued Operations -- -- 0.02 -- Net Income $ 3.76 $ 1.03 $ 6.95 $ 1.08 Weighted Average Common Shares Outstanding: Basic 24,884 18,203 21,595 18,306 Diluted 28,618 18,973 25,273 18,609 SEACOR HOLDINGS INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data, unaudited) Three Months Ended Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, 2005 2005 2005 2005 2004 Operating Revenue $334,119 $294,869 $177,831 $165,185 $181,997 Costs and Expenses: Operating expenses 177,012 180,136 117,179 115,601 126,240 Administrative and general 36,256 31,115 19,329 18,495 17,592 Depreciation and amortization 44,405 46,535 18,492 18,282 15,365 257,673 257,786 155,000 152,378 159,197 Gains (Losses) on Asset Sales and Impairments 13,575 (618) 1,812 13,516 598 Operating Income 90,021 36,465 24,643 26,323 23,398 Other Income (Expense): Interest income 6,284 4,754 4,484 3,679 3,200 Interest expense (16,470) (16,541) (7,550) (7,591) (6,154) Derivative loss, net (881) (4,425) (178) (1,590) 1,787 Foreign currency transaction gains (losses), net 16,895 2,436 4,401 (549) 1,944 Marketable securities sale gains (losses), net 2,957 10,388 8,502 6,234 1,689 Other, net 176 891 440 200 108 8,961 (2,497) 10,099 383 2,574 Income from Continuing Operations Before Income Tax Expense (Benefit), Minority Interest in (Income) Loss of Subsidiaries and Equity In Earnings of 50% or Less Owned Companies 98,982 33,968 34,742 26,706 25,972 Income Tax Expense (Benefit) (6,336) 13,894 12,448 9,740 8,395 Income from Continuing Operations Before Minority Interest in (Income) Loss of Subsidiaries and Equity in Earnings of 50% or Less Owned Companies 105,318 20,074 22,294 16,966 17,577 Minority Interest in (Income) Loss of Subsidiaries (71) 223 (154) 3 (289) Equity in Earnings of 50% or Less Owned Companies 1,250 200 2,594 1,617 2,028 Income from Continuing Operations 106,497 20,497 24,734 18,617 19,316 Income (loss) from Discontinued Operations -- -- 390 (26) -- Net Income $106,497 $ 20,497 $ 25,124 $ 18,591 $ 19,316 Basic Earnings Per Common Share: Income from Continuing Operations $ 4.28 $ 0.83 $ 1.35 $ 1.02 $ 1.06 Income from Discontinued Operations -- -- 0.02 -- -- Net Income $ 4.28 $ 0.83 $ 1.37 $ 1.02 $ 1.06 Diluted Earnings Per Common Share: Income from Continuing Operations $ 3.76 $ 0.76 $ 1.18 $ 0.90 $ 1.03 Income from Discontinued Operations -- -- 0.02 -- -- Net Income $ 3.76 $ 0.76 $ 1.20 $ 0.90 $ 1.03 Weighted Average Common Shares Outstanding: Basic 24,884 24,789 18,349 18,249 18,203 Diluted 28,618 28,562 21,924 21,908 18,973 Common Shares Outstanding at Period End 24,819 25,009 18,466 18,442 18,307 SEACOR HOLDINGS INC. OPERATING INCOME BY LINE OF BUSINESS (in thousands, unaudited) Three Months Ended Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, 2005 2005 2005 2005 2004 Offshore Marine Services Operating Revenue $168,823 $146,842 $84,043 $80,350 $80,841 Costs and Expenses: Operating expenses 85,377 82,726 50,735 52,850 51,781 Administrative and general 12,809 11,290 8,241 7,501 8,494 Depreciation and amortization 22,772 25,040 10,950 10,670 10,979 120,958 119,056 69,926 71,021 71,254 Gains (Losses) on Asset Sales and Impairments 6,578 (905) 1,770 12,923 283 Operating Income $54,443 $26,881 $15,887 $22,252 $ 9,870 Inland River Services Operating Revenue $40,666 $29,702 $27,333 $25,530 $31,878 Costs and Expenses: Operating expenses 18,498 17,203 16,880 14,772 17,034 Administrative and general 691 644 570 508 630 Depreciation and amortization 3,479 3,151 2,791 2,597 2,453 22,668 20,998 20,241 17,877 20,117 Gains on Asset Sales -- -- -- 11 34 Operating Income $17,998 $ 8,704 $ 7,092 $ 7,664 $11,795 Environmental Services Operating Revenue $37,583 $27,466 $35,635 $35,893 $ 62,824 Costs and Expenses: Operating expenses 21,852 17,400 27,347 26,655 51,737 Administrative and general 4,669 4,546 4,177 3,811 2,843 Depreciation and amortization 664 901 778 860 770 27,185 22,847 32,302 31,326 55,350 Gains (Losses) on Asset Sales (27) (19) 42 (3) (1) Operating Income $10,371 $ 4,600 $ 3,375 $ 4,564 $ 7,473 Aviation Services (2) Operating Revenue $38,856 $43,949 $30,949 $23,801 $ 7,188 Costs and Expenses: Operating expenses 26,960 30,583 22,346 21,713 6,422 Administrative and general 4,571 3,579 1,858 2,581 637 Depreciation and amortization 4,199 4,212 3,940 4,066 1,080 35,730 38,375 28,144 28,360 8,139 Gains on Asset Sales 7,024 306 -- 585 283 Operating Income $10,150 $ 5,881 $ 2,805 $(3,974) $ (668)
(2) Includes the Company's Fixed Based Operation for all periods presented that was previously included in "Other".
SEACOR HOLDINGS INC. OPERATING INCOME BY LINE OF BUSINESS (continued) (in thousands, unaudited) Three Months Ended Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, 2005 2005 2005 2005 2004 Marine Transportation Services Operating Revenue $36,625 $35,723 -- -- -- Costs and Expenses: Operating expenses 17,677 24,692 -- -- -- Administrative and general 874 705 -- -- -- Depreciation and amortization 11,641 11,663 -- -- -- 30,192 37,060 -- -- -- Gains on Asset Sales -- -- -- -- -- Operating Income $ 6,433 $(1,337) -- -- -- Towing and Harbor Services Operating Revenue $11,949 $11,343 -- -- -- Costs and Expenses: Operating expenses 7,043 7,673 -- -- -- Administrative and general 1,663 1,333 -- -- -- Depreciation and amortization 1,303 1,226 -- -- -- 10,009 10,232 -- -- -- Gains on Asset Sales -- -- -- -- -- Operating Income $ 1,940 $1,111 -- -- -- Corporate and Eliminations Operating Revenue $ (383) $ (156) $ (129) $ (389) $ (734) Costs and Expenses: Operating expenses (395) (141) (129) (389) (734) Administrative and general 10,979 9,018 4,483 4,094 4,988 Depreciation and amortization 347 342 33 89 83 10,931 9,219 4,387 3,794 4,337 Losses on Asset Sales -- -- -- -- (1) Operating Income (Loss) $(11,314) $(9,375) $(4,516) $(4,183) $(5,072) SEACOR HOLDINGS INC. SELECTED CONSOLIDATED BALANCE SHEET DATA (in thousands, unaudited) Dec. 31, Sep. 30, Jun. 30, Mar. 31, Dec. 31, 2005 2005 2005 2005 2004 Cash, Restricted Cash, Securities, Construction Reserve Funds, and Title XI Reserve Funds $ 684,521 $ 664,164 $ 533,417 $ 615,153 $ 495,387 Receivables 260,831 267,108 200,476 164,848 193,050 Current Assets 839,091 867,290 664,839 689,255 598,721 Net Property and Equipment 1,759,393 1,784,083 934,213 845,386 925,587 Total Assets 2,885,141 2,959,169 1,798,967 1,778,953 1,766,009 Current Liabilities 247,906 209,396 125,114 143,697 142,486 Total Long-term Debt & Capital Lease Obligations 977,635 1,126,431 597,467 582,416 582,367 Stockholders' Equity 1,361,305 1,280,028 831,254 811,932 793,757
CONTACT: Timothy McKeand, Vice President, SEACOR Holdings, +1-954-524-4200, ext. 820