Ceanic Announces Fourth Quarter, 1997 Year-end Results.HOUSTON--(BUSINESS WIRE)--Feb. 24, 1998--American Oilfield Divers Inc. doing business as Ceanic (NASDAQ NASDAQ in full National Association of Securities Dealers Automated Quotations U.S. market for over-the-counter securities. Established in 1971 by the National Association of Securities Dealers (NASD), NASDAQ is an automated quotation system that reports on :DIVE DIVE Distributed Interactive Virtual Environment DIVE Direct Interface Video Extensions DIVE Dismounted Infantry in a Virtual Environment ) today reported revenue of $38.8 million and net income of $985,000 ($0.09 per share) for the fourth quarter ended Dec. 31, 1997, and revenue and net income of $132.7 million and $2.2 million ($0.22 per share), respectively, for the year ended Dec. 31, 1997. Both fourth quarter revenue and net income increased compared with revenue of $26.3 million and net income of $331,000 for the same period a year ago. Revenues increased 25% to $132.7 million in fiscal 1997 compared to $105.8 million for fiscal 1996, but net income decreased to $2.2 million in fiscal 1997 compared to $5.0 million in fiscal 1996. However, Ceanic would have recorded net income of approximately $4.5 million ($0.44 per share) in fiscal 1997 had Ceanic not recorded non-recurring charges totaling $2.3 million, after tax, as previously reported in the fiscal 1997 third quarter. "Although we recorded a healthy 25% annual revenue growth rate and our core markets remain strong, we elected to focus on the achievement of our long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. strategy towards the deep-water deep-wa·ter adj. Of, relating to, or carried on in waters of a relatively great depth: a deep-water port; deep-water drilling for oil. Adj. 1. and international markets which, in turn, affected our short-term Short-term Any investments with a maturity of one year or less. short-term 1. Of or relating to a gain or loss on the value of an asset that has been held less than a specified period of time. profitability," said Rod Stanley Stanley, town (1991 pop. 1,557), capital of the Falkland Islands, S Atlantic Ocean, on East Falkland island. It is the main port and trading center of the islands. The name is sometimes written as Port Stanley. , Ceanic's president and CEO (1) (Chief Executive Officer) The highest individual in command of an organization. Typically the president of the company, the CEO reports to the Chairman of the Board. . "We have added significant capital assets capital assets n. equipment, property, and funds owned by a business. (See: capital, capital account) and experienced management expertise in 1997 with the resultant This article is about the resultant of polynomials. For the result of adding two or more vectors, see Parallelogram rule. For the technique in organ building, see Resultant (organ). In mathematics, the resultant of two monic polynomials increased levels of SG&A and depreciation expense. Although they did not reach their full potential in fiscal 1997, these added resources should pay dividends for years to come." Kevin KEVIN Keepers of the Eternal Vigilance of the Islamic Nation (fictional, from White Teeth by Zadie Smith) Peterson Pe·ter·son , Oscar Emmanuel Born 1925. Canadian jazz pianist. A prolific recording artist noted for his technical skill, he is best known for work produced with his own trio (1953-1965). , Ceanic's COO (Cell Of Origin) See mobile positioning. , added, "We view 1997 as our transition year to focus internally and position ourselves as a deepwater Deepwater or Deep Water may refer to:
The 25% increase in revenue was primarily attributable to significantly higher activity levels in Ceanic's Americas A·mer·i·cas , the See America. and Europe Africa Regions, and to revenue attributable to Ceanic's relatively new business units such as its Asia Pacific Region, and Concrete Products and HardSuits Divisions. Ceanic's gross profit margins Gross profit margin Gross profit divided by sales, which is equal to each sales dollar left over after paying for the cost of goods sold. gross profit margin A measure calculated by dividing gross profit by net sales. remained relatively flat for fiscal 1997 at 32.8% compared to 33.8% for fiscal 1996 primarily due to lower activity levels in the General Contracting Division and lower margins in the Subsea Products Division. Ceanic's SG&A increased 41% to $27.4 million in fiscal 1997 compared to $19.5 million for fiscal 1996 primarily due to costs associated with the newly acquired Hard Suits and Contract Diving diving Sport of plunging into water, usually headfirst and often following the execution of one or more acrobatic maneuvers. It emerged as a competitive sport in the late 19th century and became part of the Olympic Games in 1904. Services, Pty. Ltd., the addition of international and deepwater management infrastructure, the addition of the new Houston headquarters and the added costs of supporting increased activities in the Americas Region. Ceanic has attracted seasoned executives from much larger companies desiring to work in an aggressive, growth company; since March 1997, Ceanic has added approximately four hundred years Four Hundred Years was a melodic screamo band from Richmond, VA. Although they were only together for just over two years, the band produced two full-length releases and a compilation of singles on Lovitt Records. of subsea and topside oilfield service management experience. Ceanic's depreciation and amortization expense increased 72% to $11.7 million for fiscal 1997 compared to $6.8 million in fiscal 1996. This increase is primarily attributable to the addition of significant capital assets to the company's product and service offerings as well as to the $1.5 million write-down Write-Down Reducing the book value of an asset because it is overvalued compared to the market value. Notes: This is usually reflected in the company's income statement as an expense, thereby reducing net income. of goodwill associated with the company's Hard Suits subsidiary taken in the third quarter of 1997. Regional Review/Outlook Americas Region Ceanic's core Gulf of Mexico Noun 1. Gulf of Mexico - an arm of the Atlantic to the south of the United States and to the east of Mexico Golfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east diving and vessel business experienced strong utilization with gradually increasing dayrates in fiscal 1997, while accounting for approximately 51% of Ceanic's overall revenue and 54% of Ceanic's overall gross profits in fiscal 1997. As a result of the strong demand for its services in this region, Ceanic recorded record dive crew days and vessel days in this region for fiscal 1997. Based on traditional industry indicators, Ceanic expects the Gulf of Mexico to continue a relatively strong demand trend for its services during fiscal 1997. To address these needs, Ceanic expects to incur To become subject to and liable for; to have liabilities imposed by act or operation of law. Expenses are incurred, for example, when the legal obligation to pay them arises. An individual incurs a liability when a money judgment is rendered against him or her by a court. significant capital expenditures during 1998 for the acquisition of at least seven deepwater ROVs and one 240-foot DSV DSV Deep Submergence Vehicle DSV Diving Support Vessel DSV Dynamic Signature Verification DSV Dilute Solution Viscosity DSV Directia Sanitar Veterinara DSV Dive Surface Valve (rebreather) . Asia Pacific Region Ceanic established its Asia Pacific Region in July 1997 with the acquisition of Contract Diving Services. Since that time, Ceanic has bolstered bol·ster n. A long narrow pillow or cushion. tr.v. bol·stered, bol·ster·ing, bol·sters 1. To support or prop up with or as if with a long narrow pillow or cushion. 2. its management team and pursued large turnkey See turnkey system. and other opportunities in the area. Ceanic recorded a small loss in this region for fiscal 1998. This region was instrumental in assisting Ceanic's Field Development Division secure its first ever Tarpon tarpon (tär`pŏn), common name for members of the family Elopidae, large herringlike game fish of the warm seas of the Western Hemisphere, ranging occasionally from Long Island to Brazil and to the west coast of Africa and entering freshwater Guyed Monotower installation in Indonesia that is expected to be completed in the first quarter of 1998. Europe Africa Region Ceanic reorganized re·or·gan·ize v. re·or·gan·ized, re·or·gan·iz·ing, re·or·gan·iz·es v.tr. To organize again or anew. v.intr. To undergo or effect changes in organization. this region in fiscal 1997 with the establishment of Aberdeen, Scotland as the regional headquarters and with West Africa West Africa A region of western Africa between the Sahara Desert and the Gulf of Guinea. It was largely controlled by colonial powers until the 20th century. West African adj. & n. reporting directly to Aberdeen rather than the United States United States, officially United States of America, republic (2005 est. pop. 295,734,000), 3,539,227 sq mi (9,166,598 sq km), North America. The United States is the world's third largest country in population and the fourth largest country in area. . West Africa experienced a 51% increase in revenue compared to fiscal 1996. Products Ceanic's Field Development Division experienced significant growth in fiscal 1997, with the Ceanic Concrete Products group generating significant revenue and gross profits for a full 12 months and the installation of a Tarpon Guyed Monotower in the Gulf of Mexico. Although Ceanic's Big Inch Products group experienced relatively flat revenues year-over-year, it did experience significant activity levels in the fourth quarter of fiscal 1997 and the early part of the fiscal 1998 first quarter. Hard Suits continues to be an area of focus. For fiscal 1997, exclusive of its sales of suits to other Ceanic subsidiaries and the $1.5 million write-down of goodwill in the third quarter of 1997, Hard Suits recorded an operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of $2.1 million, net of tax, (or $0.21 per share). Ceanic has hired an experienced subsea systems manufacturing executive and is aggressively pursuing a number of government contracts on the heels of the successful builder's trials of the U.S. Navy's 2,000 foot suit. General Contracting Division Ceanic recently combined the company's traditional Inland and West Coast groups and formed the General Contracting Division. Although the division's revenue remained relatively flat year-over-year, the diversity of the fiscal 1997 revenue accurately reflects this group's growth potential and long-term value to the company. Statements in this press release regarding profitability of Hard Suits, and of the company generally, utilization and dayrates in the Gulf of Mexico, opportunities in the Asia-Pacific market, and the company's Inland/West Coast sector and other statements included herein that are not statements of historical fact are forward-looking statements forward-looking statement A projected financial statement based on management expectations. A forward-looking statement involves risks with regard to the accuracy of assumptions underlying the projections. involving factors that could cause actual results to vary materially from those predicted. The company's ability to return Hard Suits to profitability depends on among other things, securing government defense contracts for its product lines, development of new products and the timing of such revenues. Other forward-looking statements, including statements as to the company's profitability, depend upon, among other things, prices of crude oil and natural gas, weather conditions in offshore markets, capital expenditures by customers and the company's ability to procure To cause something to happen; to find and obtain something or someone. Procure refers to commencing a proceeding; bringing about a result; persuading, inducing, or causing a person to do a particular act; obtaining possession or control over an item; or making a person large turnkey projects. Ceanic is a leading provider of diving services, intervention A procedure used in a lawsuit by which the court allows a third person who was not originally a party to the suit to become a party, by joining with either the plaintiff or the defendant. technologies, subsea products and marine construction services to offshore industries in the U.S. Gulf of Mexico and internationally. -0-
AMERICAN OILFIELD DIVERS, INC.
Consolidated Results of Operations and Financial Position
($ in thousands except for per share amounts)
Three Months Ended Year Ended
December 31, December 31,
Income Statement 1997 1996 1997 1996
Revenues $38,821 $26,306 $132,728 $105,772
Gross profit 12,542 7,897 43,524 35,706
Selling, general and
administrative expenses 8,153 4,727 27,424 19,486
Depreciation and amortization 2,714 2,078 11,663 6,815
----- ----- ------ -----
Operating income 1,675 1,092 4,437 9,405
Other income (expense), net 60 (281) 569 (434)
------- ------- ------- -------
Income before income taxes 1,735 811 5,006 8,971
Income tax provision 750 480 2,775 3,950
------- ------- ------- -------
Net income $ 985 $ 331 $ 2,231 $ 5,021
======= ======= ======= =======
Net income per share (basic) $ .09 $ .05 $ .22 $ .74
======= ======= ======= =======
Net income per share
(diluted) $ .09 $ .05 $ .22 $ .73
======= ======= ======= =======
Weighted average shares
outstanding 10,639 6,840 10,166 6,787
======= ======= ======= =======
Operational Data
Dive crew days 13,785 9,497 51,419 40,131
Dive crews per day 150 103 141 110
Diving support vessel
utilization 54% 49% 53% 51%
Earnings before
interest, taxes,
depreciation and
amortization (EBITDA) $4,389 $3,170 $16,100 $16,220
EBITDA as % of revenue 11.3% 12.1% 12.1% 15.3%
SG&A as % of revenue 21.0% 18.0% 20.7% 18.4%
Gross profit % 32.3% 30.0% 32.8% 33.8%
December 31,
Balance Sheet 1997 1996
Assets:
Current assets $55,286 $35,734
Other long-term assets 79,014 57,173
--------- --------
Total assets $134,300 $92,907
======== =======
Liabilities & Stockholders' Equity:
Current liabilities $29,698 $23,512
Long-term debt 8,060 8,459
Other liabilities 6,291 15,091
Stockholders' equity 90,251 45,845
-------- --------
Total liabilities & stockholders equity $134,300 $92,907
======== ========
Three Months Ended December 30, 1997
Asia Europe General
Americas Pacific Africa Contracting Subsea
Region(1) Region Region Division(2) Products(3) Total
Revenues $17,556 $1,223 $2,226 $11,654 $6,162 $38,821
Expenses $11,085 $ 849 $1,678 $ 8,134 $4,533 $26,279
Gross Profit $6,471 $ 374 $ 548 $ 3,520 $1,629 $12,542
Gross Profit
Percentage 36.9% 30.6% 24.6% 30.2% 26.4% 32.3%
Three Months Ended December 30, 1996
Asia Europe General
Americas Pacific Africa Contracting Subsea
Region(1) Region Region Division(2) Products(3) Total
Revenues $12,485 $ --- $1,635 $7,970 $4,216 $26,306
Expenses $ 9,163 $ --- $1,204 $4,907 $3,135 $18,409
Gross Profit $3,322 $ --- $ 431 $3,063 $1,081 $ 7,897
Gross Profit
Percentage 26.7% ---% 26.4% 38.4% 25.6% 30.0%
1 Includes operations in the company's Americas Region, which
encompasses diving, vessel and related services, and
environmental remediation services, all of which were performed
in the Gulf of Mexico. The company's environmental remediation
business was sold effective Oct. 31, 1997.
2 Includes diving and related services in U.S. inland markets, off
the U.S. West Coast and in Latin America.
3 Includes manufacturing and marketing of Big Inch pipeline
connectors, Tarpon marginal well production systems, Tarpon
Concrete Storage Systems and Hard Suits Inc. products.
Year Ended December 31, 1997
Asia Europe General
Americas Pacific Africa Contracting Subsea
Region(1) Region Region Division(2) Products(3) Total
Revenues $68,339 $2,798 $11,798 $30,583 $19,210 $132,728
Expenses $44,690 $1,766 $ 7,845 $21,955 $12,948 $ 89,204
Gross Profit $23,649 $1,032 $ 3,953 $ 8,628 $ 6,262 $ 43,524
Gross Profit
Percentage 34.6% 36.9% 33.5% 28.2% 32.6% 32.8%
Year Ended December 31, 1996
Asia Europe General
Americas Pacific Africa Contracting Subsea
Region(1) Region Region Division(2) Products(3) Total
Revenues $53,220 $ --- $ 7,837 $34,097 $10,618 $105,772
Expenses $36,037 $ --- $ 5,490 $22,025 $ 6,514 $ 70,066
Gross
Profit $17,183 $ --- $ 2,347 $12,072 $ 4,104 $ 35,706
Gross Profit
Percentage 32.3% ---% 29.9% 35.4% 38.7% 33.8%
1 Includes operations in the company's Americas Region, which
encompasses diving, vessel and related services, and
environmental remediation services, all of which were performed
in the Gulf of Mexico. The company's environmental remediation
business was sold effective Oct. 31, 1997.
2 Includes diving and related services in U.S. inland markets, off
the U.S. West Coast and in Latin America.
3 Includes manufacturing and marketing of Big Inch pipeline
connectors, Tarpon marginal well production systems, Tarpon
Concrete Storage Systems and Hard Suits Inc. products.
CONTACT: American Oilfield Divers/Ceanic Kevin C. Peterson/Cathy M. Green, 713/430-1100 http://www.amdive.com |
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