SOURCE: Trico Marine Services, Inc.

May 03, 2006 23:19 ET

Trico Marine Services Reports Record 2006 First Quarter Results -- Net Income and EPS at All-Time Highs of $12.4 Million and $0.82 per Share

HOUSTON, TX -- (MARKET WIRE) -- May 3, 2006 -- Trico Marine Services, Inc. (NASDAQ: TRMA) (the "Company" or "Trico") today announced its financial results for the quarter ended March 31, 2006.

Highlights for the Quarter

--  Net income of $12.4 million, or $0.82 per share (diluted), increased
    57 % over net income for the fourth quarter of 2005 and is the highest
    reported quarterly net income and earnings per share in the Company's
    history.
--  Operating income of $19.6 million increased 19% over the operating
    income of $16.4 million for the fourth quarter of 2005 and represents our
    highest operating income since the second quarter of 1998.
--  Charter hire revenues of $50.5 million were our highest first quarter
    revenues ever, balancing record average day rates and near-capacity
    utilization levels for our actively marketed Gulf of Mexico vessels against
    decreased day rates and utilization in the North Sea due to a slight
    reduction of vessel activity caused by seasonally harsh weather conditions.
--  Cash provided from operations for the quarter was $19.7 million,
    resulting in a net surplus of cash in excess of debt of $23.7 million at
    the end of the quarter.
--  On March 31, 2006, we entered into a shipbuilding contract for the
    construction of a new Marin Teknikk Design MT6009 MKII Platform Supply
    Vessel for a total cost of approximately $25 million.  Delivery of the new
    vessel is expected late in the fourth quarter of 2007.
    
Summary Results
(In thousands, except per share data and day rates)

                                           Three months    Three months
                                               ended           ended
                                          March 31, 2006   Dec. 31, 2005
                                          --------------   -------------
Charter hire revenues                          $  50,482       $  50,606
Operating income                                  19,553          16,434
Net income                                        12,378           7,879
Diluted EPS                                    $    0.82       $    0.57

Day Rates:
----------
Supply / Anchor Handling (North Sea class)     $  15,836       $  16,751
Supply Vessels (Gulf class)                       10,202           8,300

Utilization:
------------
Supply / Anchor Handling (North Sea class)           94%             96%
Supply Vessels (Gulf class)                          64%             67%

Trico's President and Chief Executive Officer, Trevor Turbidy, commented, "For the quarter, Trico produced the highest net income in its history due to the continued strength in the Gulf of Mexico, where activity and rates continue to improve with 48% of our worldwide charter hire revenues for the first quarter of 2006 being generated in that market. We currently have better visibility than ever due to the backlog of hurricane repair activity and repair related services and increased E&P activity in the shallow water Gulf."

The Gulf of Mexico average day rates continued to strengthen due to a limited supply of vessels coupled with increased vessel demand. Utilization for the Gulf class was negatively impacted by regulatory dry dockings in the first quarter of 2006. Decreased day rates and utilization for the North Sea class was primarily due to seasonally harsh weather conditions and a marked decrease in the number of rig moves, resulting in lower spot rates and decreased utilization for the AHTS vessels during the quarter. Our Gulf of Mexico utilization for the actively marketed fleet was 89% for the first quarter of 2006 and 94% for the fourth quarter of 2005.

In April 2006, North Sea day rates averaged $17,988 with utilization of 94% while day rates for our Gulf class supply vessels averaged $10,965 with utilization of 60%, or 81% for all actively marketed vessels.

General and administrative expenses decreased from $8.2 million in the fourth quarter of 2005 to $5.7 million in the first quarter of 2006. Decreased general and administrative expenses can be largely attributed to the accrual of an annual incentive cash bonus plan in the fourth quarter of 2005.

Included in operating income was the benefit of approximately $1.3 million for the first quarter of 2006 and $3.1 million for the fourth quarter of 2005 for the amortization of non-cash deferred revenue. For the first quarter of 2006, operating income was positively affected by the gains on sales of assets of $0.8 million. For the fourth quarter of 2005, operating income was negatively affected by a net charge of $0.4 million comprising a loss on assets held for sale of $2.2 million offset by gains on sales of assets of $1.8 million.

About Trico

Trico provides a broad range of marine support services to the oil and gas industry, primarily in the North Sea, Gulf of Mexico, West Africa, Mexico and Brazil. The services provided by the Company's diversified fleet of vessels include the transportation of drilling materials, supplies and crews to drilling rigs and other offshore facilities; towing drilling rigs and equipment from one location to another; and support for the construction, installation, repair and maintenance of offshore facilities. Trico has its principal office in Houston, Texas.

Certain statements in this press release that are not historical fact may be "forward looking statements." Actual events may differ materially from those projected in any forward-looking statement. There are a number of important factors involving risks and uncertainties beyond the control of the Company that could cause actual events to differ materially from those expressed or implied by such forward-looking statements. A description of risks and uncertainties relating to Trico Marine Services, Inc. and its industry and other factors, which could affect the Company's results of operations or financial condition, are included in the Company's Securities and Exchange Commission filings. Trico undertakes no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this report.

TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(UNAUDITED)
(In thousands, except share and per share amounts)

                                                Three months  Three months
                                                    ended         ended
                                                  March 31,   December 31,
                                                    2006          2005
                                                ------------  ------------
Revenues:
Charter hire                                    $     50,482  $     50,606
Amortization of non-cash deferred revenues             1,269         3,065
Other vessel income                                       81           235
                                                ------------  ------------
Total revenues                                        51,832        53,906

Operating expenses:
Direct vessel operating expenses and other            21,202        22,233
General and administrative                             5,742         8,161
Depreciation and amortization expense                  6,102         6,659
Loss on assets held for sale                               -         2,237
Gain on sales of assets                                 (767)       (1,818)
                                                ------------  ------------
Total operating expenses                              32,279        37,472

Operating income                                      19,553        16,434

Interest expense                                        (481)       (1,495)
Amortization of deferred financing costs                 (50)          (76)
Loss on early retirement of debt                           -        (3,950)
Other gain (loss), net                                   233           488
                                                ------------  ------------
Income before income taxes                            19,255        11,401

Income tax expense                                     6,877         3,522
                                                ------------  ------------

Net income                                      $     12,378  $      7,879
                                                ============  ============

Basic income per common share:
 Net income                                     $       0.85  $       0.58
                                                ------------  ------------
 Average common shares outstanding                14,574,169    13,504,657
                                                ============  ============

Diluted income per common share:
 Net income                                     $       0.82  $       0.57
                                                ------------  ------------
 Average common shares outstanding                15,042,889    13,924,371
                                                ============  ============


                                             Three months     Three months
                                  Month of      ended            ended
                                    April      March 31,      December 31,
 Average Day Rates:               --------  --------------  --------------
  PSV/AHTS (North Sea class)      $ 17,988  $       15,836  $       16,751
  PSV/AHTS (North Sea class)      $ 17,988  $       15,836  $       16,751
  Supply (Gulf class)               10,965          10,202           8,300
  Crew/line handling                 4,963           3,336           2,798
 Utilization:
  PSV/AHTS (North Sea class)            94%             94%             96%
  Supply (Gulf class)(1)                60%             64%             67%
  Crew/line handling                    88%             87%             90%
 Average Number of Vessels:
  PSV/AHTS (North Sea class)          16.0            16.0            16.0
  Supply (Gulf class)                 44.6            45.0            46.6
  Crew/line handling                   9.0            11.0            14.7

(1) Stacked vessels are included in the calculation of utilization.
Excluding stacked vessels, our supply vessel utilization was 81% during the
one month period ended April 30, 2006, 89% during the three month period
ended March 31, 2006 and 94% during the three month period ended December
31, 2005.


TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(In thousands, except share and per share amounts)

                                                 March  31,   December 31,
                                                    2006          2005
ASSETS                                          ------------  ------------
Current assets:
 Cash and cash equivalents                      $     61,458  $     51,218
 Restricted cash                                         412           570
 Accounts receivable, net                             46,549        42,986
 Prepaid expenses and other current assets             4,075         3,484
 Assets held for sale                                  7,224         5,853
                                                ------------  ------------
 Total current assets                                119,718       104,111

Property and equipment:
 Land and buildings                                    1,858         1,844
 Marine vessels                                      245,132       241,360
 Construction-in-progress                                180           235
 Transportation and other                              1,740         1,566
                                                ------------  ------------
                                                     248,910       245,005
Less accumulated depreciation and amortization        25,267        19,359
                                                ------------  ------------
 Net property and equipment                          223,643       225,646

Restricted cash - noncurrent                           7,923         7,253
Other assets                                           7,766         7,212
                                                ------------  ------------
 Total assets                                   $    359,050  $    344,222
                                                ============  ============

LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
 Short-term and current maturities of debt      $     27,854  $     36,610
 Accounts payable                                      7,597         6,295
 Accrued expenses                                     10,037        10,715
 Accrued insurance reserve                             3,262         3,426
 Accrued interest                                        399           288
 Income taxes payable                                    607           518
                                                ------------  ------------
 Total current liabilities                            49,756        57,852

Long-term debt, including premiums                     9,911         9,928
Deferred income taxes                                 49,807        46,055
Deferred revenues on unfavorable contracts             4,249         5,379
Other liabilities                                      2,864         2,576
                                                ------------  ------------
 Total liabilities                                   116,587       121,790

Commitments and contingencies
Stockholders' equity:
Preferred stock, $.01 par value                            -             -
Common stock, $.01 par value                             147           146
Warrants - Series A                                    1,649         1,649
Warrants - Series B                                      634           634
Additional paid-in capital                           212,714       208,143
Retained earnings                                     32,478        20,100
Cumulative foreign currency translation
 adjustment                                           (5,159)       (8,240)
Treasury stock, at par value                               -             -
                                                ------------  ------------
Total stockholders' equity                           242,463       222,432
                                                ------------  ------------

Total liabilities and stockholders' equity      $    359,050  $    344,222
                                                ============  ============


TRICO MARINE SERVICES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)

                                                Predecessor
                          Successor Company       Company
                        ----------------------  ------------
                                   Period from  Period from
                          Three     March 15,    January 1,     Combined
                          months       2005         2005      Three months
                          ended      through      through         ended
                        March 31,  March  31,     March 14,     March 31,
                          2006         2005         2005          2005
                        ---------  -----------  ------------  ------------
Net loss                $  12,378  $       106  $    (61,361) $    (61,255)
 Adjustments to
 reconcile net income
 (loss) to net cash
 provided by (used in)
 operating activities:
  Depreciation and
   amortization             6,136        1,155         8,808         9,963
  Amortization of
   deferred revenues       (1,269)        (599)            -          (599)
  Deferred marine
   inspection costs             -            -        (1,277)       (1,277)
  Deferred income taxes     6,475          293         1,397         1,690
  Gain on debt
   discharge                    -            -      (166,459)     (166,459)
  Fresh start
   adjustments                  -            -       219,008       219,008
  Loss (gain) on sales
   of assets                 (767)           -             2             2
  Provision for
   doubtful accounts          150           10            40            50
  Stock compensation
   expense                    293        1,160             9         1,169
  Change in operating
  assets and
  liabilities:                                                          -
   Accounts receivable     (3,243)       1,312         2,404         3,716
   Prepaid expenses and
    other current
    assets                   (553)          95          (630)         (535)
   Accounts payable and
    accrued expenses          396       (2,743)        7,676         4,933
   Other, net                (258)         714          (449)          265
                        ---------  -----------  ------------  ------------
   Net cash provided by
    operating
    activities             19,738        1,503         9,168        10,671
                        ---------  -----------  ------------  ------------

Cash flows from
investing activities:
 Purchases of property
  and equipment            (1,023)         (43)         (947)         (990)
 Proceeds from sales of
  assets                    1,289            -             -             -
 Increase in restricted
  cash                       (491)        (501)          508             7
 Other, net                     -          235          (211)           24
                        ---------  -----------  ------------  ------------
   Net cash used in
    investing
    activities               (225)        (309)         (650)         (959)
                        ---------  -----------  ------------  ------------

Cash flows from
financing activities:
 Net proceeds from
  issuance of common
  stock                       117          733             -           733
 Proceeds from issuance
  of debt                       -       54,550        54,550       109,100
 Repayment of debt         (9,621)     (59,355)      (56,771)     (116,126)
 Deferred financing
  costs and other               -            -          (375)         (375)
                        ---------  -----------  ------------  ------------
   Net cash used in
    financing
    activities             (9,504)      (4,072)       (2,596)       (6,668)
                        ---------  -----------  ------------  ------------

Effect of exchange rate
 changes on cash and
 cash equivalents             231         (369)           62          (307)
                        ---------  -----------  ------------  ------------

Net increase (decrease)
 in cash and cash
 equivalents               10,240       (3,247)        5,984         2,737
Cash and cash
 equivalents at
 beginning of period       51,218       19,154        13,170        13,170
                        ---------  -----------  ------------  ------------
Cash and cash
 equivalents at end of
 period                 $  61,458  $    15,907  $     19,154  $     15,907
                        =========  ===========  ============  ============

Contact Information

  • Contact:
    Geoff Jones
    VP and Chief Financial Officer
    (713) 780-9926