SOURCE: Vantage Drilling Company

July 30, 2012 06:00 ET

Vantage Drilling Company Reports Second Quarter 2012 Results

HOUSTON, TX--(Marketwire - Jul 30, 2012) -  Vantage Drilling Company ("Vantage") (NYSE MKT: VTG) reports a net loss of $10.0 million or ($0.03) per diluted share for the three months ended June 30, 2012 as compared to a net loss of $40.1 million or ($0.14) per diluted share for the three months ended June 30, 2011.

For the six months ended June 30, 2012, Vantage reports a net loss of $11.2 million or ($0.04) per diluted shares as compared to a net loss of $58.7 million or ($0.20) per diluted shares for the six months ended June 30, 2011.

In April 2012, we acquired the Titanium Explorer and have mobilized the vessel to the United States Gulf of Mexico where it is currently undergoing customer acceptance testing. The acquisition has been financed with the proceeds from the $775.0 million senior notes offering. The notes were priced at 108% of par, resulting in total proceeds to the Company in excess of $820.0 million, net of offering fees and expenses. In connection with certain pre-commencement activities of the Titanium Explorer, we recorded approximately $2.4 million of project costs as operating expenses for the three months ended June 30, 2012. 

Paul Bragg, Chairman and Chief Executive Officer, commented, "We are pleased to announce another strong quarter from operations, with the jackups achieving in excess of 99% productive time and the Platinum Explorer, while out of service for the scheduled 10 days of equipment upgrades, otherwise achieved productive time in excess of 99%. Following the acquisition of the Titanium Explorer, the drillship mobilized to the US Gulf of Mexico on-time, completed coast guard inspections, and continues to progress customer acceptance." 

Vantage, a Cayman Islands exempted company, is an offshore drilling contractor, with an owned fleet of four Baker Marine Pacific Class 375 ultra-premium jackup drilling rigs and two ultra-deepwater drillships, the Platinum Explorer and the Titanium Explorer, as well as an additional ultra-deepwater drillship, the Tungsten Explorer, now under construction. 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 and managed 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
June 30,
    Six Months Ended
June 30,
 
    2012     2011     2012     2011  
Revenues                                
  Contract drilling services   $ 99,683     $ 97,977     $ 204,681     $ 184,731  
  Management fees     956       3,171       3,678       7,214  
  Reimbursables     4,486       19,946       28,615       53,780  
    Total revenues     105,125       121,094       236,974       245,725  
Operating costs and expenses                                
  Operating costs     50,030       65,433       119,354       142,826  
  General and administrative     6,704       7,402       11,964       14,249  
  Depreciation     16,372       16,025       32,944       32,137  
    Total operating costs and expenses     73,106       88,860       164,262       189,212  
Income from operations     32,019       32,234       72,712       56,513  
Other income (expense)                                
  Interest income     21       22       33       60  
  Interest expense and other financing charges     (36,172 )     (39,350 )     (72,935 )     (80,892 )
  Loss on debt extinguishment     -       (25,196 )     -       (25,196 )
  Other income, net     216       (22 )     861       1,458  
    Total other income (expense)     (35,935 )     (64,546 )     (72,041 )     (104,570 )
Income (loss) before income taxes     (3,916 )     (32,312 )     671       (48,057 )
Income tax provision     6,061       7,758       11,827       10,667  
Net loss   $ (9,977 )   $ (40,070 )   $ (11,156 )   $ (58,724 )
                                 
Loss per share                                
  Basic   $ (0.03 )   $ (0.14 )   $ (0.04 )   $ (0.20 )
  Diluted   $ (0.03 )   $ (0.14 )   $ (0.04 )   $ (0.20 )
                                   
                                   
Vantage Drilling Company  
Consolidated Balance Sheet  
(In thousands, except par value information)  
           
  June 30,     December 31,  
  2012     2011  
  (Unaudited)        
ASSETS              
Current assets              
  Cash and cash equivalents $ 123,709     $ 110,031  
  Restricted cash   5,878       7,028  
  Trade receivables   78,221       100,908  
  Inventory   33,631       24,376  
  Prepaid expenses and other current assets   13,044       16,909  
    Total current assets   254,483       259,252  
Property and equipment              
  Property and equipment   2,789,126       1,913,596  
  Accumulated depreciation   (140,900 )     (108,521 )
    Property and equipment, net   2,648,226       1,805,075  
Other assets              
  Other assets   86,375       58,173  
    Total other assets   86,375       58,173  
Total assets $ 2,989,084     $ 2,122,500  
               
LIABILITIES AND SHAREHOLDERS' EQUITY              
Current liabilities              
  Accounts payable $ 56,843     $ 46,362  
  Accrued liabilities   140,111       103,809  
    Total current liabilities   196,954       150,171  
Long-term debt, net of premium (discount) of $22,666 and ($38,572)   2,082,666       1,246,428  
Other long-term liabilities   20,054       29,755  
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, 400,000 shares authorized; 292,350 and 291,241 shares issued and outstanding   292       291  
  Additional paid-in capital   864,921       860,502  
  Accumulated deficit   (175,803 )     (164,647 )
    Total shareholders' equity   689,410       696,146  
Total liabilities and shareholders' equity $ 2,989,084     $ 2,122,500  
               
               
Vantage Drilling Company  
Consolidated Statement of Cash Flows  
(In thousands)  
(Unaudited)  
   
  Six Months Ended June 30,  
  2012     2011  
CASH FLOWS FROM OPERATING ACTIVITIES              
Net loss $ (11,156 )   $ (58,724 )
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:              
  Depreciation expense   32,944       32,137  
  Amortization of debt financing costs   7,438       3,888  
  Non-cash loss on debt extinguishment   -       3,532  
  Share-based compensation expense   4,420       2,415  
  Accretion of long-term debt   -       2,582  
  Amortization of debt discount (premium)   (762 )     5,415  
  Deferred income tax expense (benefit)   1,860       (128 )
  Loss on disposal of assets   249       -  
Changes in operating assets and liabilities:              
  Restricted cash   1,150       22,801  
  Trade receivables   (10,977 )     (36,303 )
  Inventory   (9,256 )     (2,396 )
  Prepaid expenses and other current assets   1,476       4,130  
  Other assets   1,357       897  
  Accounts payable   10,481       9,394  
  Accrued liabilities   644       2,948  
    Net cash provided by (used in) operating activities   29,868       (7,412 )
CASH FLOWS FROM INVESTING ACTIVITIES              
  Additions to property and equipment   (816,722 )     (116,876 )
    Net cash used in investing activities   (816,722 )     (116,876 )
CASH FLOWS FROM FINANCING ACTIVITIES              
  Proceeds from issuance of senior secured notes, including issue premiums of $62,000 and $15,750   837,000       240,750  
  Repayment of long-term debt   -       (109,716 )
  Debt issuance costs   (36,468 )     (12,693 )
    Net cash provided by financing activities   800,532       118,341  
    Net increase (decrease) in cash and cash equivalents   13,678       (5,947 )
  Cash and cash equivalents -- beginning of period   110,031       120,443  
  Cash and cash equivalents -- end of period $ 123,709     $ 114,496  
               

Contact Information

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