SEACOR SMIT Announces Fourth Quarter Results

HOUSTON--(BUSINESS WIRE)--SEACOR SMIT Inc. (NYSE:CKH) announced net earnings for the fourth quarter ended December 31, 2002 of $1,638,000, or $0.08 per diluted share, on operating revenues of $99,708,000.

For the twelve months ended December 31, 2002, net earnings were $46,587,000, or $2.28 per diluted share, on operating revenues of $403,158,000. Twelve-month results included an after-tax gain of $12,817,000, or $0.61 per diluted share, resulting from the merger of Chiles Offshore Inc. ("Chiles") and Ensco International Incorporated (the "Chiles Merger") and an extraordinary loss due to debt extinguishment of $1,520,000, or $0.07 per diluted share (the "2002 Extraordinary Loss").

In the quarter ended December 31, 2001, SEACOR earned $18,679,000, or $0.93 per diluted share, on operating revenues of $109,804,000. For the twelve months ended December 31, 2001, net earnings were $70,701,000, or $3.43 per diluted share, on operating revenues of $434,790,000. Twelve-month results included an extraordinary loss due to debt extinguishment of $896,000, or $0.04 per diluted share.

Net earnings in the quarter ended September 30, 2002 were $21,295,000, or $1.02 per diluted share, on operating revenues of $102,137,000. Results for the quarter included the effect of the Chiles Merger and 2002 Extraordinary Loss.

The financial results for the quarter as compared to the prior quarter were impacted by a variety of factors highlighted below and described in greater detail in subsequent paragraphs and tables in this release:

-- Changes in fleet size and composition: Due to net vessel dispositions, particularly those in the international fleet, there were 202 fewer available revenue earning boat days during the quarter. This impacted revenues by approximately $2.2 million.

-- Declines in fleet utilization: Lower utilization, particularly for North Sea anchor handling towing supply vessels and utility boats in the Gulf of Mexico, accounted for approximately $1.6 million less revenue. Utilization and day rate tables are included in this press release.

-- Decrease in arrangement fees: In the prior quarter, the Company earned a $0.8 million arrangement fee for services performed in obtaining certain financing for Chiles. There were no similar fees during the current quarter.

-- Increased marine operating expenses: Higher running costs, primarily engine and hull repairs, offset by lower statutory drydock expense, exceeded the prior quarter by $2.5 million.

-- Increased overhead expense: General and administrative expenses exceeded the previous quarter by $1.2 million, largely due to the cost of providing employee severance benefits.

-- Increased net interest expense: The "negative spread" associated with carrying additional cash raised by the sale of 10 year notes with a 5 7/8% coupon was approximately $2.3 million.

-- Inland river business: The Company took delivery of 34 new inland river hopper barges in the current quarter. Operating revenue and operating income increased $1.9 million and $0.7 million, respectively.

-- Environmental services: Reduced retainer revenue and less spill response activity contributed to a $0.3 million decline in operating income.

Overall operating revenues decreased $2,429,000 from the third quarter. Results of the offshore marine business segment declined approximately $2,800,000. The effect of net vessel dispositions, as previously detailed, was the biggest factor impacting operating revenues. Utilization of the offshore marine fleet was 76.8% in the fourth quarter as compared to 77.7% in the prior quarter. Utilization declined throughout the last three months of the year. Forty-seven vessels, primarily U.S.-operated utility and crew, were out of service due to market conditions at the end of the year.

During the current quarter, the Company took delivery of 4 new mini-supply and 1 new towing supply vessel, and 2 additional vessels were bareboat chartered-in. Six vessels were sold, one of which was leased-back. Due to the timing of the vessel additions and sales, as noted above, there were 202 fewer "available vessel days." The impact on revenue was even greater as the equipment sold were international towing supply/anchor handling towing supply vessels.

Operating income declined $6,282,000 from the third quarter of 2002 due to the combination of lower operating revenues and higher operating and general and administrative expenses as detailed above.

Net interest expense rose $1,482,000 between quarters due to an increase in outstanding indebtedness. On September 27, 2002, the Company completed the sale of $200,000,000 aggregate principal amount of 5 7/8% Senior Notes due October 1, 2012 (the "5 7/8% Senior Notes").

Income from equipment sales increased $756,000 from the third quarter of 2002. The sale of six vessels in the quarter contributed $2,088,000 to income. The Company also recognized income from a sale completed in a prior quarter to a joint venture whose recognition was deferred based on the Company having financed the sale. That sale was re-financed with a lending institution. The previous quarter's results included a write-down of the carrying value of equipment associated with a cancelled offshore vessel construction contract.

Derivative losses during the fourth quarter were approximately $2,424,000, $827,000 less than in the prior quarter. These losses were incurred in connection with a transaction that hedged the Company's share ownership position in Ensco International Incorporated, which position was obtained as a result of the Chiles Merger. In the prior quarter, the Company had derivative losses associated with interest rate swap agreements entered into in anticipation of the placement of its 5 7/8% Senior Notes.

Other income decreased approximately $4,100,000. The decrease included $2,860,000 less gains from the sale of marketable securities than in the third quarter. Foreign currency accounting gains were also lower between periods.

Equity interest in the earnings of 50% or less owned companies decreased $1,073,000 between quarters. Offshore marine joint venture earnings were lower due primarily to lower profits of the Company's Mexican operations. Prior quarter results included a write-down in the carrying value of the Company's investment in Strategic Software Ltd. The Company's fourth quarter equity interest in the net losses of Globe Wireless, L.L.C., a marine telecommunications investment, was $370,000, or $0.02 per diluted share.

The Company, which had previously acquired a 20% interest in Tex-Air Helicopters, Inc. ("Tex-Air"), acquired the balance of Tex-Air's equity on December 31, 2002. A total of approximately $3,000,000 of consideration was paid for Tex-Air, including approximately $2,800,000 in the form of SEACOR common stock. Tex-Air operates a fleet of 36 helicopters serving the offshore oil and gas industry in the U.S. Gulf of Mexico.

At December 31, 2002, cash and cash equivalents, marketable securities and construction reserve funds totaled $525,931,000.

In February 2003, cash proceeds from the sale of two North Sea anchor handling towing supply vessels totaled $51,500,000. Also in February, the Company redeemed $35,317,000 of its 5 3/8% Convertible Subordinated Notes due 2006 for $35,949,000. The redemption, which involved the payment of a small premium to principal amount, retired the issue. The write-off of related unamortized deferred financing cost and the recognition of premium expense will result in an after-tax charge of $731,000, or $0.03 per diluted share. Following the completion of these two transactions, the Company's cash and cash equivalents, marketable securities and construction reserve funds totaled approximately $544,000,000.

As of December 31, 2002, the Company had on order 4 platform supply vessels under construction in the Gulf of Mexico. One of these vessels is committed for sale. Delivery of these vessels commences in May 2003 and is spread over the next 11 months. The Company has on order 6 crew boats that will be delivered over the next 7 months. The Company also has contracts to acquire or bareboat 2 towing supply vessels under construction in Asia. The inland river division of the Company has contracts to acquire 61 barges. The aggregate cost of the Company's firm commitments for new construction is $108,300,000, of which $25,000,000 had been expended as of the end of 2002.

SEACOR and its subsidiaries are primarily 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 include environmental services, inland river operations, and helicopter transportation services to the oil and gas industry mainly in the U.S. Gulf of Mexico.

This release includes "forward-looking statements" as described in the Private Securities Litigation Reform Act of 1995. Statements herein that describe the Company's business strategy, industry outlook, objectives, plans, intentions or goals also are forward-looking statements. All such forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those in forward-looking statements, including risks associated with the level of oil and natural gas exploration, the availability of competitive vessels, and the level of oil and natural gas prices. Forward-looking statements included in this release speak only as of the date of this release and SEACOR disclaims 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 Randall Blank, Executive Vice President and Chief Financial Officer, at (281) 899-4800 or (212) 307-6633 or visit SEACOR's website at www.seacorsmit.com.

 SEACOR SMIT Inc. and Subsidiaries
 Condensed Consolidated Statements of Operations
 (in thousands, except share data, unaudited)

 Three Months Ended Twelve Months Ended
 December 31, December 31,
 ----------------------- -----------------------
 2002 2001 2002 2001
 ----------- ----------- ----------- -----------
Operating Revenues $ 99,708 $ 109,804 $ 403,158 $ 434,790
 ----------- ----------- ----------- -----------
Costs and Expenses:
 Operating expenses 67,306 58,348 249,892 234,551
 Administrative and
 general 14,668 13,186 53,265 49,980
 Depreciation and
 amortization 13,991 16,058 56,244 58,324
 ----------- ----------- ----------- -----------
 95,965 87,592 359,401 342,855
 ----------- ----------- ----------- -----------
Operating Income 3,743 22,212 43,757 91,935
 ----------- ----------- ----------- -----------
Other Income
 (Expense):
 Interest on debt (5,764) (5,205) (17,064) (21,998)
 Interest income 2,821 2,636 8,833 13,546
 Income from
 equipment sales
 or retirements,
 net 3,077 1,038 8,635 9,030
 Gain from Chiles
 Merger - - 19,719 -
 Derivative income
 (loss), net (2,424) 2,165 (5,043) 4,127
 Other, net 1,486 4,411 9,643 7,081
 ----------- ----------- ----------- -----------
 (804) 5,045 24,723 11,786
 ----------- ----------- ----------- -----------
Income Before Income
 Taxes, Minority
 Interest, Equity in
 Earnings of 50% or
 Less Owned Companies
 and Extraordinary
 Item 2,939 27,257 68,480 103,721
Income Tax Expense 1,266 9,172 23,852 36,058
 ----------- ----------- ----------- -----------
Income Before
 Minority Interest,
 Equity in Earnings
 of 50% or Less Owned
 Companies and
 Extraordinary Item 1,673 18,085 44,628 67,663
Minority Interest in
 Income of
 Subsidiaries (32) (116) (226) (372)
Equity in Earnings of
 50% or Less Owned
 Companies, net (3) 710 3,705 4,306
 ----------- ----------- ----------- -----------
Income Before
 Extraordinary Item 1,638 18,679 48,107 71,597
Extraordinary Item -
 Loss on Debt
 Extinguishment, net
 of tax - - (1,520) (896)
 ----------- ----------- ----------- -----------
Net Income $ 1,638 $ 18,679 $ 46,587 $ 70,701
 =========== =========== =========== ===========
Basic Earnings Per
 Common Share:
 Income before
 extraordinary
 item $ 0.08 $ 0.93 $ 2.41 $ 3.68
 Extraordinary item - - (0.08) (0.05)
 ----------- ----------- ----------- -----------
 Net income $ 0.08 $ 0.93 $ 2.33 $ 3.63
 =========== =========== =========== ===========
Diluted Earnings Per
 Common Share(1):
 Income before
 extraordinary
 item $ 0.08 $ 0.93 $ 2.35 $ 3.47
 Extraordinary item - - (0.07) (0.04)
 ----------- ----------- ----------- -----------
 Net income $ 0.08 $ 0.93 $ 2.28 $ 3.43
 =========== =========== =========== ===========
Weighted Average
 Common Shares:
 Basic(2) 19,823,095 19,995,193 19,997,625 19,490,115
 Diluted 20,032,229 21,284,236 21,057,877 21,335,182
EBITDA(3) $ 17,738 $ 40,014 $ 102,951 $ 156,034

(1) The assumed conversion of the Company's convertible notes into
 shares of common stock has been excluded from the computation of
 diluted earnings per share in the three month period ended
 December 31, 2002 as the effect was antidilutive. In this same
 period, such shares were also excluded from the calculation of
 diluted weighted average common shares outstanding. Diluted
 earnings per common share for the three month period ended
 December 31, 2001 were equivalent to basic earnings due to a
 benefit of $789,000, or $0.04 per diluted share, related to the
 Company's participation in an equity forward contract associated
 with its redemption of $10 million of its 5 3/8% Convertible
 Subordinated Notes in the second quarter.

(2) Total common shares outstanding were 19,921,092 and 20,083,670 on
 December 31, 2002 and 2001, respectively.

(3) As used herein, "EBITDA" is operating income plus depreciation and
 amortization, minority interest in (income) loss of subsidiaries
 and equity in net earnings of 50% or less owned companies, before
 applicable income taxes. EBITDA should not be considered by an
 investor as an alternative to net income as an indicator of the
 Company's operating performance or as an alternative to cash flows
 as a better measure of liquidity.

 SEACOR SMIT Inc. and Subsidiaries
 Segment Results
 (in thousands, unaudited)

 Three Months Ended Twelve Months Ended
 December 31, December 31,
 --------------------- --------------------
 2002 2001 2002 2001
 --------- --------- --------- ---------
Operating Revenues:
 Offshore Marine $ 89,382 $ 100,364 $ 367,969 $ 399,123
 Other(1) 10,393 9,587 35,456 36,445
 Intersegment (67) (147) (267) (778)
 --------- --------- --------- ---------
 Total $ 99,708 $ 109,804 $ 403,158 $ 434,790
 ========= ========= ========= =========
Operating Margin(2):
 Offshore Marine $ 27,127 $ 46,363 $ 134,483 $ 182,270
 Other(1) 5,275 5,093 18,783 17,969
 --------- --------- --------- ---------
 Total $ 32,402 $ 51,456 $ 153,266 $ 200,239
 ========= ========= ========= =========

(1) Other includes the Company's environmental and inland river
 businesses.

(2) Operating margin is defined as operating revenues less direct
 vessel operating expenses. Administrative and general and
 depreciation and amortization expenses are excluded.

 Offshore Marine Fleet - Operating Statistics

 Three Months Ended Twelve Months Ended
 December 31, December 31,
 ------------------- -------------------
 2002 2001 2002 2001
 --------- --------- --------- ---------
Rates per Day Worked -
 Worldwide ($):
 Supply and Towing Supply 7,834 8,073 7,985 7,771
 Anchor Handling Towing
 Supply 14,109 12,601 13,067 13,548
 Crew 3,148 3,415 3,216 3,313
 Standby Safety 6,288 5,656 5,935 5,448
 Utility and Line Handling 1,762 1,916 1,755 1,895
 Mini-Supply 2,983 3,025 2,854 3,071
 Geophysical, Freight and
 Other(1) - 5,380 - 5,406
Overall Utilization -
 Worldwide (%)(2):
 Supply and Towing Supply 85.7 87.3 88.1 88.8
 Anchor Handling Towing
 Supply 73.1 90.1 78.2 84.6
 Crew 78.3 85.9 80.3 93.4
 Standby Safety 88.5 85.3 87.4 87.3
 Utility and Line Handling 58.0 55.4 60.6 56.1
 Mini-Supply 86.2 86.0 86.9 91.7
 Geophysical, Freight and
 Other(1) - 43.5 - 51.8
 Overall Fleet 76.8 78.5 78.5 81.1
Fleet Composition at Period
 End(2):
 Supply and Towing Supply 71 79
 Anchor Handling Towing Supply 28 31
 Crew 96 91
 Standby Safety 26 30
 Utility and Line Handling 45 65
 Mini-Supply 33 26
 Geophysical, Freight and
 Other(1) 2 3
 ---------- ---------
 Total Offshore Marine Fleet 301 325
 ========== =========

(1) In 2002, the Company directly owned one of the vessels in this
 class and it did not operate in these periods.

(2) Statistics exclude vessels retired from service in the applicable
 periods.

 SEACOR SMIT Inc. and Subsidiaries
 Supplementary Financial and Operational Data
 (in thousands, except share and operational data, unaudited)

 Quarter Ended
 ----------------------------------------
 Dec. 31, Sept. 30, June 30,
 2002 2002 2002
 ------------ ------------ ------------
Operating Revenues $ 99,708 $ 102,137 $ 97,670
Operating Expenses 67,306 64,297 61,133
Administrative and General 14,668 13,434 12,803
Depreciation and Amortization 13,991 14,381 13,996
 ------------ ------------ ------------
Operating Income 3,743 10,025 9,738
Net Interest Expense (2,943) (1,460) (1,694)
Income from Equipment Sales,
 net 3,077 2,321 938
Gain from Chiles Merger - 19,719 -
Derivative Income (Loss), net (2,424) (3,251) 1,404
Other, net 1,486 5,584 6,898
 ------------ ------------ ------------
Income Before Income Taxes,
 Minority Interest and Equity
 Earnings 2,939 32,938 17,284
Income Tax Expense 1,266 11,187 6,156
 ------------ ------------ ------------
Income Before Minority
 Interest and Equity Earnings 1,673 21,751 11,128
Minority Interest (32) (6) (95)
Equity Earnings (3) 1,070 1,215
 ------------ ------------ ------------
Income Before Extraordinary
 Item 1,638 22,815 12,248
Extraordinary Item - (1,520) -
 ------------ ------------ ------------
Net Income $ 1,638 $ 21,295 $ 12,248
 ============ ============ ============

Weighted Average Common
 Shares(1):
 Basic 19,823,095 20,051,743 20,078,231
 Diluted 20,032,229 21,186,390 21,393,472
Diluted Earnings Per Common
 Share Before Extraordinary
 Item(1) $ 0.08 $ 1.09 $ 0.59
EBITDA $ 17,738 $ 25,165 $ 24,459
Balance Sheet:
 Cash and Construction
 Reserve Funds $ 437,307 $ 475,829 $ 237,060
 Marketable Securities 88,624 61,121 23,261
 Total Assets 1,487,107 1,467,396 1,293,455
 Total Long-term Debt 402,118 401,347 257,383
 Stockholders' Equity 804,951 804,227 784,127
Rates Per Day Worked -
 Worldwide ($):
 Supply and Towing Supply 7,834 8,153 7,964
 Anchor Handling Towing
 Supply 14,109 13,144 12,103
 Crew 3,148 3,200 3,224
 Standby Safety 6,288 6,268 5,726
 Utility 1,762 1,761 1,744
 Mini-Supply 2,983 2,918 2,749
 Geophysical, Freight and
 Other(2) - - -
Overall Utilization -
 Worldwide (%)(3):
 Supply and Towing Supply 85.7 88.9 89.0
 Anchor Handling Towing
 Supply 73.1 72.9 79.1
 Crew 78.3 76.3 81.8
 Standby Safety 88.5 88.2 84.8
 Utility 58.0 62.4 62.3
 Mini-Supply 86.2 90.0 85.9
 Geophysical, Freight and
 Other(2) - - -
 Overall Offshore Marine
 Fleet 76.8 77.7 79.1
Fleet Composition at Period
 End(3):
 Supply and Towing Supply 71 69 74
 Anchor Handling Towing
 Supply 28 30 32
 Crew 96 95 95
 Standby Safety 26 28 28
 Utility 45 48 48
 Mini-Supply 33 28 26
 Geophysical, Freight and
 Other(2) 2 2 3
 ------------ ------------ ------------
 Total Offshore Marine
 Fleet 301 300 306
 ============ ============ ============


 Quarter Ended
 ---------------------------
 Mar. 31, Dec. 31,
 2002 2001
 ------------ ------------
Operating Revenues $ 103,643 $ 109,804
Operating Expenses 57,156 58,348
Administrative and General 12,360 13,186
Depreciation and Amortization 13,876 16,058
 ------------ ------------
Operating Income 20,251 22,212
Net Interest Expense (2,134) (2,569)
Income from Equipment Sales, net 2,299 1,038
Gain from Chiles Merger - -
Derivative Income (Loss), net (772) 2,165
Other, net (4,325) 4,411
 ------------ ------------
Income Before Income Taxes, Minority
 Interest and Equity Earnings 15,319 27,257
Income Tax Expense 5,243 9,172
 ------------ ------------
Income Before Minority Interest and Equity
 Earnings 10,076 18,085
Minority Interest (93) (116)
Equity Earnings 1,423 710
 ------------ ------------
Income Before Extraordinary Item 11,406 18,679
Extraordinary Item - -
 ------------ ------------
Net Income $ 11,406 $ 18,679
 ============ ============

Weighted Average Common Shares(1):
 Basic 20,039,130 19,995,193
 Diluted 21,350,345 21,284,236
Diluted Earnings Per Common Share Before
 Extraordinary Item(1) $ 0.55 $ 0.93
EBITDA $ 35,589 $ 40,014
Balance Sheet:
 Cash and Construction Reserve Funds $ 242,055 $ 235,684
 Marketable Securities 22,250 22,371
 Total Assets 1,283,952 1,298,138
 Total Long-term Debt 256,572 256,741
 Stockholders' Equity 765,979 743,698
Rates Per Day Worked - Worldwide ($):
 Supply and Towing Supply 7,986 8,073
 Anchor Handling Towing Supply 13,108 12,601
 Crew 3,293 3,415
 Standby Safety 5,404 5,656
 Utility 1,753 1,916
 Mini-Supply 2,737 3,025
 Geophysical, Freight and Other(2) - 5,380
Overall Utilization - Worldwide (%)(3):
 Supply and Towing Supply 88.8 87.3
 Anchor Handling Towing Supply 87.2 90.1
 Crew 85.4 85.9
 Standby Safety 88.0 85.3
 Utility 59.6 55.4
 Mini-Supply 85.4 86.0
 Geophysical, Freight and Other(2) - 43.5
 Overall Offshore Marine Fleet 80.6 78.5
Fleet Composition at Period End(3):
 Supply and Towing Supply 77 79
 Anchor Handling Towing Supply 34 31
 Crew 95 91
 Standby Safety 31 30
 Utility 49 65
 Mini-Supply 26 26
 Geophysical, Freight and Other(2) 3 3
 ------------ ------------
 Total Offshore Marine Fleet 315 325
 ============ ============

(1) The assumed conversion of the Company's convertible notes into
 shares of common stock has been excluded from the computation of
 diluted earnings per share in the three month period ended
 December 31, 2002 as the effect was antidilutive. In this same
 period, such shares were also excluded from the calculation of
 diluted weighted average common shares outstanding.

(2) In 2002, the Company directly owned one of the vessels in this
 class and it did not operate in these periods.

(3) Statistics exclude vessels retired from service in the applicable
 periods.