SOURCE: Vantage Drilling Company

November 09, 2011 06:00 ET

Vantage Drilling Company Reports Third Quarter 2011 Results

HOUSTON, TX--(Marketwire - Nov 9, 2011) - Vantage Drilling Company ("Vantage") (NYSE Amex: VTG) reports a net loss of $11.9 million or ($0.04) per diluted share for the three months ended September 30, 2011 as compared to a net loss of $5.8 million or ($0.02) per share excluding $27.8 million of charges in the prior year period relating to the acquisition of the Platinum Explorer and refinancing of certain debt. The three months ended September 30, 2010, including the acquisition and refinancing charges was a loss of $33.6 million or ($0.12) per diluted.

For the nine months ended September 30, 2011, Vantage reports a net loss of $45.4 million or ($0.16) per share excluding approximately $25.2 million of charges for refinancing debt as compared to a loss of $6.8 million or ($.03) per share in the prior year period, excluding approximately $27.8 million of acquisition and refinancing charges. Including the refinancing charges for the nine months ended September 30, 2011, Vantage reported a net loss $70.6 million or ($0.24) per share as compared to a net loss of $34.6 million or $(0.14) per share for the nine months ended September 30, 2010, including the acquisition and refinancing charges.

Paul Bragg, Chairman and Chief Executive Officer, commented, "Our fleet performed very well during the quarter as we achieved nearly 100% productive time operating our jackup fleet and the Platinum Explorer operated at approximately 97% productive time. We are also pleased to announce that during the quarter, we also completed the customer-reimbursed upgrades on the Topaz Driller and have since commenced operations in Malaysia in early October."

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 the ultra-deepwater drillship, the Platinum 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 September 30, Nine Months Ended September 30,
2011 2010 2011 2010
Revenues
Contract drilling services $ 89,882 $ 44,864 $ 274,402 $ 132,632
Management fees 3,285 4,516 10,499 13,391
Reimbursables 25,367 17,527 79,148 47,488
Total revenues 118,534 66,907 364,049 193,511
Operating costs and expenses
Operating costs 69,610 41,582 212,224 112,946
General and administrative 6,219 6,294 20,469 15,703
Depreciation 15,988 8,768 48,126 24,611
Total operating expenses 91,817 56,644 280,819 153,260
Income from operations 26,717 10,263 83,230 40,251
Other income (expense)
Interest income 7 381 68 396
Interest expense and financing charges (37,074 ) (14,292 ) (117,966 ) (35,608 )
Loss on debt extinguishment - (24,006 ) (25,196 ) (24,006 )
Loss on acquisition of subsidiary - (3,780 ) - (3,780 )
Other income 455 618 1,913 1,568
Total other expense (36,612 ) (41,079 ) (141,181 ) (61,430 )
Loss before income taxes (9,895 ) (30,816 ) (57,951 ) (21,179 )
Income tax provision 1,986 2,765 12,654 13,435
Net loss $ (11,881 ) $ (33,581 ) $ (70,605 ) $ (34,614 )
Loss per share
Basic $ (0.04 ) $ (0.12 ) $ (0.24 ) $ (0.14 )
Diluted $ (0.04 ) $ (0.12 ) $ (0.24 ) $ (0.14 )
Vantage Drilling Company
Consolidated Balance Sheet
(In thousands, except par value information)


September 30,
2011
December 31,
2010
(Unaudited)
ASSETS
Current assets
Cash and cash equivalents $ 37,188 $ 120,443
Restricted cash 6,761 29,004
Trade receivables 118,823 50,190
Inventory 22,326 19,760
Prepaid expenses and other current assets 5,079 11,472
Total current assets 190,177 230,869
Property and equipment
Property and equipment 1,892,973 1,762,844
Accumulated depreciation (92,640 ) (44,712 )
Property and equipment, net 1,800,333 1,718,132
Other assets
Other assets 57,652 54,193
Total other assets 57,652 54,193
Total assets $ 2,048,162 $ 2,003,194
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities
Accounts payable $ 37,104 $ 32,332
Accrued liabilities 45,795 75,159
Short-term debt 857 8,574
Total current liabilities 83,756 116,065
Long-term debt, net of discount of $40,530 and $63,654 1,244,470 1,103,480
Other long-term liabilities 16,346 13,498
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; 290,706 and 289,713 shares issued and outstanding 291 290
Additional paid-in capital 858,600 854,557
Accumulated deficit (155,301 ) (84,696 )
Total shareholders' equity 703,590 770,151
Total liabilities and shareholders' equity $ 2,048,162 $ 2,003,194
Vantage Drilling Company
Consolidated Statement of Cash Flows
(In thousands)
(Unaudited)
Nine Months Ended
September 30,
2011 2010
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss $ (70,605 ) $ (34,614 )
Adjustments to reconcile net income to net cash provided by (used in) operating activities:
Depreciation expense 48,126 24,611
Amortization of debt financing costs 6,269 3,515
Non-cash loss on debt extinguishment 3,532 12,280
Non-cash loss recognized related to acquisition of subsidiary - 3,780
Share-based compensation expense 4,044 4,594
Accretion of long-term debt 2,582 3,965
Amortization of debt discount 7,374 2,682
Deferred income tax expense 123 1,650
Gain on disposal of assets (86 ) -
Changes in operating assets and liabilities:
Restricted cash 22,243 1,944
Trade receivables (68,633 ) (38,333 )
Inventory (2,566 ) (8,113 )
Prepaid expenses and other current assets 6,393 5,723
Other assets (456 ) (12,084 )
Accounts payable 4,772 15,065
Accrued liabilities (30,363 ) 24,039
Short-term debt - 1,467
Net cash provided by (used in) operating activities (67,251 ) 12,171
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to property and equipment (126,695 ) (57,253 )
Acquisition of assets - (79,777 )
Escrowed funds for acquisition - (510,916 )
Proceeds from sale of property and equipment 301 -
Net cash used in investing activities (126,394 ) (647,946 )
CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from issuance of senior secured notes, net 240,750 963,610
Repayment of long-term debt (109,716 ) (293,129 )
Proceeds from issuance of ordinary shares in public offerings, net - 101,889
Repayment of short-term debt (7,717 ) (4,267 )
Debt issuance costs (12,927 ) (31,776 )
Net cash provided by financing activities 110,390 736,327
Net increase (decrease) in cash and cash equivalents (83,255 ) 100,552
Cash and cash equivalents--beginning of period 120,443 15,992
Cash and cash equivalents--end of period $ 37,188 $ 116,544

Contact Information

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