SOURCE: Vantage Drilling Company

May 06, 2014 06:00 ET

Vantage Drilling Company Reports First Quarter 2014 Results

HOUSTON, TX--(Marketwired - May 6, 2014) - Vantage Drilling Company ("Vantage" or the "Company") (NYSE MKT: VTG) reports net income for the three months ended March 31, 2014 of $24.8 million or $0.07 per diluted share as compared to a net loss of $24.9 million or ($0.08) per diluted share excluding approximately $98.3 million of charges for the early retirement of debt, for the three months ended March, 31, 2013. Including the charges for the early retirement of debt for the three months ended March 31, 2013, the Company reported a net loss of $123.2 million or ($0.41) per diluted share.

Paul Bragg, Chairman and Chief Executive Officer, commented, "We are pleased to announce another strong quarter of operating results. We also made good initial progress on our debt reduction plan, paying down almost $30 million during the quarter and we remain on track to reach our goal for 2014 given our contracted backlog and high operating efficiency across the fleet." 

Vantage, a Cayman Islands exempted company, is an offshore drilling contractor, with an owned fleet of three ultra-deepwater drillships, the Platinum Explorer, the Titanium Explorer and the Tungsten Explorer, as well as an additional ultra-deepwater drillship, the Cobalt Explorer, now under construction, and four Baker Marine Pacific Class 375 ultra-premium jackup drilling rigs. Vantage's primary business is to contract drilling units, related equipment and work crews primarily on a dayrate basis to drill oil and natural gas wells. Vantage also provides construction supervision services for, and will operate and manage, drilling units owned by others. Through its fleet of seven owned drilling units, Vantage is a provider of offshore contract drilling services globally to major, national and large independent oil and natural gas companies.

The information above includes forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. These forward-looking statements are subject to certain risks, uncertainties and assumptions identified above or as disclosed from time to time in the company's filings with the Securities and Exchange Commission. As a result of these factors, actual results may differ materially from those indicated or implied by such forward-looking statements.

   
   
Vantage Drilling Company  
Consolidated Statement of Operations  
(In thousands, except per share amounts)  
(Unaudited)  
             
    Three Months Ended March 31,  
    2014     2013  
Revenues                
  Contract drilling services   $ 214,932     $ 134,664  
  Management fees     4,582       3,198  
  Reimbursables     12,951       9,139  
    Total revenues     232,465       147,001  
Operating costs and expenses                
  Operating costs     101,722       75,317  
  General and administrative     8,115       7,427  
  Depreciation     31,625       24,861  
    Total operating costs and expenses     141,462       107,605  
Income from operations     91,003       39,396  
Other income (expense)                
  Interest income     13       96  
  Interest expense and other financing charges     (54,487 )     (59,662 )
  Loss on debt extinguishment     (106 )     (98,327 )
  Other, net     779       901  
    Total other income (expense)     (53,801 )     (156,992 )
Income (loss) before income taxes     37,202       (117,596 )
Income tax provision     12,378       5,605  
Net income (loss)   $ 24,824     $ (123,201 )
                 
Earnings (loss) per share                
  Basic   $ 0.08     $ (0.41 )
  Diluted   $ 0.07     $ (0.41 )
                 
             
             
Vantage Drilling Company  
Supplemental Operating Data  
(Unaudited, in thousands, except percentages)  
             
    Three Months Ended March 31,  
    2014     2013  
Operating costs and expenses                
Jackups   $ 23,760     $ 21,845  
Deepwater     55,810       36,723  
Operations support     10,759       7,984  
Reimbursables     11,393       8,765  
    $ 101,722     $ 75,317  
                 
Utilization                
Jackups     100.0 %     98.4 %
Deepwater     96.5 %     88.5 %
                 
   
   
Vantage Drilling Company  
Consolidated Balance Sheet  
(In thousands, except par value information)  
             
    March 31,
2014
    December 31,
2013
 
    (Unaudited)        
ASSETS            
Current assets                
  Cash and cash equivalents   $ 65,261     $ 54,686  
  Restricted cash     --       2,125  
  Trade receivables     216,639       168,654  
  Inventory     58,875       55,804  
  Prepaid expenses and other current assets     20,456       23,717  
    Total current assets     361,231       304,986  
Property and equipment                
  Property and equipment     3,482,799       3,472,407  
  Accumulated depreciation     (313,334 )     (281,759 )
    Property and equipment, net     3,169,465       3,190,648  
Other assets                
  Investment in joint venture     32,374       32,482  
  Other assets     96,018       100,027  
    Total other assets     128,392       132,509  
Total assets   $ 3,659,088     $ 3,628,143  
                 
LIABILITIES AND SHAREHOLDERS' EQUITY            
Current liabilities                
  Accounts payable   $ 62,906     $ 66,860  
  Accrued liabilities     133,245       97,481  
  Current maturities of long-term debt and revolving credit agreement     53,500       63,500  
    Total current liabilities     249,651       227,841  
Long-term debt, net of discount of $36,486 and $39,325     2,835,514       2,852,050  
Other long-term liabilities     41,502       42,796  
Commitments and contingencies                
Shareholders' equity                
  Preferred shares, $0.001 par value, 10,000 shares authorized; none issued or outstanding     --       --  
  Ordinary shares, $0.001 par value, 500,000 shares authorized; 305,997 and 304,101 shares issued and outstanding     306       304  
  Additional paid-in capital     899,067       896,928  
  Accumulated deficit     (366,952 )     (391,776 )
    Total shareholders' equity     532,421       505,456  
Total liabilities and shareholders' equity   $ 3,659,088     $ 3,628,143  
                 
   
   
Vantage Drilling Company  
Consolidated Statement of Cash Flows  
(In thousands)  
(Unaudited)  
    Three Months Ended March 31,  
    2014     2013  
CASH FLOWS FROM OPERATING ACTIVITIES                
Net income (loss)   $ 24,824     $ (123,201 )
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:                
  Depreciation expense     31,625       24,861  
  Amortization of debt financing costs     2,964       3,995  
  Amortization of debt discount (premium)     2,839       (97 )
  Non-cash loss on debt extinguishment     106       6,070  
  Share-based compensation expense     2,141       2,069  
  Deferred income tax expense (benefit)     (57 )     778  
  Equity in loss of joint venture     108       133  
  Loss on disposal of assets     104       1  
Changes in operating assets and liabilities:                
  Restricted cash     2,125       --  
  Trade receivables     (47,985 )     17,521  
  Inventory     (3,071 )     (4,319 )
  Prepaid expenses and other current assets     3,318       3,963  
  Other assets     1,021       290  
  Accounts payable     (3,954 )     (9,713 )
  Accrued liabilities and other long-term liabilities     33,296       (42,762 )
    Net cash provided by (used in) operating activities     49,404       (120,411 )
CASH FLOWS FROM INVESTING ACTIVITIES                
  Additions to property and equipment     (9,371 )     (15,135 )
  Proceeds from sale of property and equipment     --       2  
    Net cash used in investing activities     (9,371 )     (15,133 )
CASH FLOWS FROM FINANCING ACTIVITIES                
  Proceeds from issuance of senior secured notes, net     --       775,000  
  Proceeds from issuance of term loan, net     --       344,750  
  Repayment of long-term debt     (19,374 )     (1,006,249 )
  Proceeds from or (repayment of) revolving credit agreement, net     (10,000 )     --  
  Debt issuance costs     (84 )     (23,683 )
    Net cash provided by (used in) financing activities     (29,458 )     89,818  
    Net increase (decrease) in cash and cash equivalents     10,575       (45,726 )
  Cash and cash equivalents--beginning of period     54,686       502,726  
  Cash and cash equivalents--end of period   $ 65,261     $ 457,000  
                 

Contact Information

  • Public & Investor Relations Contact:
    Paul A. Bragg
    Chairman & Chief Executive Officer
    Vantage Drilling Company
    (281) 404-4700