W-H Energy Services Announces Fourth Quarter Earnings.HOUSTON Houston, city (1990 pop. 1,630,553), seat of Harris co., SE Tex., a deepwater port on the Houston Ship Channel; inc. 1837. Economy The fourth largest city in the nation and the largest in the entire South and Southwest, Houston is a port of entry; -- W-H Energy Services, Inc. (NYSE NYSE See: New York Stock Exchange :WHQ WHQ World Headquarters WHQ War Headquarters ) announced fourth quarter income from continuing operations continuing operations Parts of a business that are expected to be maintained as an ongoing segment of an overall business operation. Income and losses from continuing operations are reported separately if any segments have been discontinued during the of $7.5 million or $0.26 per share compared with $5.1 million or $0.18 per share reported in the preceding quarter. This 47% increase in income from continuing operations from the prior quarter was due primarily to improved utilization utilization, n 1. the extent to which a given group uses a particular service in a specified period. Although usually expressed as the number of services used per year per 100 or per 1000 persons eligible for the service, utilization rates may be in the Company's drilling segment. For the same period in the prior year, the Company reported income from continuing operations of $3.2 million or $0.11 per share. The Company projects that earnings per share will range from $0.24 to $0.28 for the quarter ending March 31, 2005. The estimate provides for approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. $0.01 to $0.02 per share related to the Company's early adoption of Statement of Financial Accounting Standards 123R, under which non-cash expense Noun 1. non-cash expense - an expense (such as depreciation) that is not paid for in cash disbursal, disbursement, expense - amounts paid for goods and services that may be currently tax deductible (as opposed to capital expenditures) related to the issuance of stock options is recorded in the income statement. Income from continuing operations for the year ended December December: see month. 31, 2004 was $22.0 million or $0.78 per share (after exclusion exclusion /ex·clu·sion/ (eks-kloo´zhun) 1. a shutting out or elimination. 2. surgical isolation of a part, as of a segment of intestine, without removal from the body. of the $1.9 million after tax write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of non-cash financing costs associated with the new credit facility entered into on June June: see month. 30, 2004) which is up 14 percent from the $19.2 million or $0.69 per share reported for the year ended December 31, 2003. Revenues for the year ended December 31, 2004 of $462.4 million and operating income Operating Income The profit realized from a business' own operations. Notes: This would not include income from things such as investments in other firms. Also referred to as operating profit or recurring profit. of $43.6 million were 26 percent and 10 percent higher than the prior year, respectively. Revenues for the fourth quarter of $131.0 million and operating income of $14.1 million were 38 percent and 85 percent higher than the fourth quarter of 2003, respectively. On a sequential One after the other in some consecutive order such as by name or number. basis, revenues and operating income increased by 13 percent and 42 percent, respectively. Domestic revenues increased 49 percent as compared to the fourth quarter of last year and were 9 percent higher than the preceding quarter. International revenues decreased 8 percent as compared to the fourth quarter of last year and were 67 percent higher than the previous quarter. As anticipated, the Company has completed its exit from the maintenance and safety segment of its business having sold Charles Charles, archduke of Austria Charles, 1771–1847, archduke of Austria; brother of Holy Roman Emperor Francis II. Despite his epilepsy, he was the ablest Austrian commander in the French Revolutionary and Napoleonic wars; however, he was handicapped by Holston Holston, river, c.120 mi (190 km) long, formed by the uniting of its northern and southern forks, NE Tenn., and flowing SW through the Great Appalachian Valley, joining the French Broad River at Knoxville to form the Tennessee River. , Inc. in December. The exit from this segment resulted in an after-tax af·ter-tax also af·ter·tax adj. Relating to or being that which remains after payment, especially of income taxes: after-tax profits. loss from discontinued operations Discontinued operations Divisions of a business that have been sold or written off and that no longer are maintained by the business. for the year ended December 31, 2004 of approximately $2.1 million or $0.07 per share. QUARTERLY SEGMENT RESULTS Drilling Revenues in the drilling segment were $88.0 million in the fourth quarter, 35 percent higher than the comparable period in the prior year and 19 percent higher than the preceding quarter. Operating income of $7.9 million was 3 percent higher than the comparable period in the prior year and 63 percent higher than the preceding quarter. Completion and workover Revenues in the completion and workover segment were $43.0 million in the fourth quarter, 45 percent higher than the comparable period in the prior year and 3 percent higher than the preceding quarter. Operating income of $8.5 million recorded in the fourth quarter was more than triple that posted for the comparable period in the prior year and was 9 percent higher than the preceding quarter.
W-H ENERGY SERVICES, INC.
UNAUDITED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except share and per share amounts)
Three Months Ended Year Ended
December 31, December 31,
----------------------- -----------------------
2004 2003 (1) 2004 2003 (1)
----------- ----------- ----------- -----------
Revenues $130,997 $94,595 $462,428 $367,183
Costs and Expenses:
Cost of revenues 75,906 55,177 269,897 209,118
Selling, general and
administrative 23,613 19,119 87,772 71,078
Research and
development 5,260 2,845 15,474 11,241
Depreciation and
amortization 12,111 9,836 45,665 36,032
----------- ----------- ----------- -----------
Total costs and
expenses 116,890 86,977 418,808 327,469
Operating income 14,107 7,618 43,620 39,714
Other (income)
expenses:
Interest expense,
net (2) 1,929 2,308 11,117 8,092
Other (income)
expense, net (27) 41 (94) 76
----------- ----------- ----------- -----------
Income before
income taxes 12,205 5,269 32,597 31,546
Provision for income
taxes 4,697 2,074 12,548 12,308
----------- ----------- ----------- -----------
Income from
continuing
operations 7,508 3,195 20,049 19,238
Income (loss) from
discontinued
operations, net of
tax (1,402) (241) (2,126) 23
----------- ----------- ----------- -----------
Net income $6,106 $2,954 $17,923 $19,261
=========== =========== =========== ===========
Earnings (loss) per
common share:
Basic:
From continuing
operations $0.27 $0.12 $0.73 $0.71
From discontinued
operations (0.05) (0.01) (0.08) -
----------- ----------- ----------- -----------
Total $0.22 $0.11 $0.65 $0.71
Diluted:
From continuing
operations $0.26 $0.11 $0.71 $0.69
From discontinued
operations (0.05) - (0.07) -
----------- ----------- ----------- -----------
Total $0.21 $0.11 $0.64 $0.69
Weighted average
shares outstanding:
Basic 27,688,017 27,341,965 27,527,881 27,189,530
Diluted 28,510,162 28,060,865 28,201,222 27,942,202
(1) Prior period statements of operations have been reclassified to
reflect the impact of discontinued operations.
(2) Interest expense for the year ended December 31, 2004 includes a
write-off of approximately $3.1 million ($1.9 million after tax)
of non-cash financing costs associated with the Company's previous
credit facility.
W-H ENERGY SERVICES, INC.
UNAUDITED CONSOLIDATED CONDENSED BALANCE SHEETS
(in thousands)
December 31, December 31,
2004 2003 (1)
------------ ------------
Assets:
Cash and cash equivalents $10,448 $11,878
Accounts receivable, net 111,728 80,888
Inventory 48,317 37,384
Other current assets 15,566 12,530
Assets held for sale - 30,652
------------ ------------
Total current assets 186,059 173,332
Property and equipment, net 235,317 201,176
Other assets 127,235 126,817
------------ ------------
Total assets $548,611 $501,325
============ ============
Liabilities and Shareholders' Equity:
Accounts payable and accrued liabilities 64,498 42,508
Current maturities of long-term debt - 10,763
Liabilities associated with held for sale
assets - 5,511
------------ ------------
Total current liabilities 64,498 58,782
Long-term debt, net of current maturities
(2) 180,805 166,962
Other liabilities 34,713 28,121
------------ ------------
Total liabilities 280,016 253,865
Shareholders' equity 268,595 247,460
------------ ------------
Total liabilities and shareholders'
equity $548,611 $501,325
============ ============
(1) The prior period balance sheet has been reclassified to reflect
the impact of assets and liabilities held for sale.
(2) As of December 31, 2004, there was approximately $51 million
available under the Company's revolving credit facility.
W-H ENERGY SERVICES, INC.
UNAUDITED SEGMENTED AND SELECTED FINANCIAL DATA
(in thousands)
Three Months Ended Year Ended
December 31, December 31,
------------------ -------------------
2004 2003 (1) 2004 2003 (1)
--------- -------- --------- ---------
SEGMENTED INFORMATION:
Revenue:
Drilling $88,030 $65,059 $302,788 $242,085
Completion and workover 42,967 29,536 159,640 125,098
--------- -------- --------- ---------
Total revenue $130,997 $94,595 $462,428 $367,183
========= ======== ========= =========
Depreciation and amortization:
Drilling $7,715 $6,299 $29,380 $23,237
Completion and workover 4,326 3,466 16,011 12,476
Corporate 70 71 274 319
--------- -------- --------- ---------
Total depreciation and
amortization $12,111 $9,836 $45,665 $36,032
========= ======== ========= =========
Operating income:
Drilling $7,864 $7,633 $22,651 $26,881
Completion and workover 8,545 2,688 30,997 22,546
Corporate (2,302) (2,703) (10,028) (9,713)
--------- -------- --------- ---------
Total operating income $14,107 $7,618 $43,620 $39,714
========= ======== ========= =========
(1) Prior period segmented and selected financial data has been
reclassified to reflect the impact of discontinued operations.
W-H ENERGY SERVICES, INC.
UNAUDITED RECONCILIATION OF NON-GAAP MEASURES (1)
(in thousands, except per share amounts)
Three Months Ended Year Ended
December 31, December 31,
------------------- ------------------
2004 2003 (2) 2004 2003 (2)
--------- --------- --------- --------
Income from continuing
operations $7,508 $3,195 $20,049 $19,238
Write-off of non-cash financing
costs - - 3,123 -
Less: Tax impact of write-off - - (1,202) -
--------- --------- --------- --------
After tax write-off - - 1,921 -
--------- --------- --------- --------
Income from continuing
operations excluding
write-off $7,508 $3,195 $21,970 $19,238
========= ========= ========= ========
Per diluted common share
information:
Income from continuing
operations $0.26 $0.11 $0.71 $0.69
After-tax write-off - - 0.07 -
--------- --------- --------- --------
Income from continuing
operations before write-
off $0.26 $0.11 $0.78 $0.69
========= ========= ========= ========
(1) Management believes that the non-GAAP measures included within
this press release are used by financial analysts and investors to
provide comparative financial information regarding the continuing
operations of the Company, particularly with regard to the
Company's new credit facility that was obtained in June 2004.
These measures should not be considered as an alternative to net
income or any other measure of operating performance calculated in
accordance with generally accepted accounting principles.
(2) Prior period financial information has been reclassified to
reflect the impact of discontinued operations.
W-H Energy is a diversified diversified (di·verˑ·s oilfield service company that provides products and services used primarily for the drilling, completion and production of oil and natural gas wells. The Company has onshore on·shore adj. 1. Moving or directed toward the shore: an onshore wind. 2. Located on the shore: an onshore beacon; an onshore patrol. adv. operations in 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. , Canada Canada (kăn`ədə), independent nation (2001 pop. 30,007,094), 3,851,787 sq mi (9,976,128 sq km), N North America. Canada occupies all of North America N of the United States (and E of Alaska) except for Greenland and the French islands of , Brazil Brazil (brəzĭl`), Port. Brasil, officially Federative Republic of Brazil, republic (2005 est. pop. 186,113,000), 3,286,470 sq mi (8,511,965 sq km), E South America. , Europe Europe (y  r`əp), 6th largest continent, c.4,000,000 sq mi (10,360,000 sq km) including adjacent islands (1992 est. pop. 512,000,000). , North Africa
and the Middle East and offshore operations in the 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 MexicoGolfo de Mexico Atlantic, Atlantic Ocean - the 2nd largest ocean; separates North and South America on the west from Europe and Africa on the east , the North Sea, the Persian Gulf Persian Gulf, arm of the Arabian Sea, 90,000 sq mi (233,100 sq km), between the Arabian peninsula and Iran, extending c.600 mi (970 km) from the Shatt al Arab delta to the Strait of Hormuz, which links it with the Gulf of Oman. , the Gulf of Suez Noun 1. Gulf of Suez - a northwestern arm of the Red Sea linked to the Mediterranean by the Suez Canal Red Sea - a long arm of the Indian Ocean between northeast Africa and Arabia; linked to the Mediterranean at the north end by the Suez Canal , the Mediterranean Sea Mediterranean Sea [Lat.,=in the midst of lands], the world's largest inland sea, c.965,000 sq mi (2,499,350 sq km), surrounded by Europe, Asia, and Africa. Geography The Mediterranean is c.2,400 mi (3,900 km) long with a maximum width of c. and off the coast of Brazil. Statements in this press release that are not strictly historical are "forward-looking for·ward-look·ing adj. Concerned with or making provision for the future: forward-looking educators; a forward-looking corporate plan. Adj. 1. " statements as defined in the Private Securities Litigation Reform Act The Private Securities Litigation Reform Act of 1995 (PSLRA) implemented several significant substantive changes affecting certain cases brought under the federal securities laws, including changes related to pleading, discovery, liability, class representation and awards fees and of 1995. Actual results may differ materially from those projected in the 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. due to, among other things, the current and expected future prices of crude oil and natural gas, the level of exploration, development and production activity of, and the corresponding capital spending capital spending Spending for long-term assets such as factories, equipment, machinery, and buildings that permits the production of more goods and services in future years. by, our customers, the development and implementation of new technologies and weather conditions in offshore markets. These risks are more fully described in W-H Energy Services, Inc.'s Annual Report filed on Form 10-K Form 10-K A report required by the SEC from exchange-listed companies that provides for annual disclosure of certain financial information. Form 10-K See 10-K. with the Securities and Exchange Commission. The Company disclaims any obligation to update the statements in this press release. |
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