SOURCE: Vantage Drilling International

March 30, 2016 07:00 ET

Vantage Drilling International Reports 4th Quarter and Annual Results for 2015

HOUSTON, TX--(Marketwired - Mar 30, 2016) - Vantage Drilling International ("Vantage" or the "Company") reports net loss attributable to shareholder for the three months ended December 31, 2015 of $8.8 million as compared to earnings of $27.6 million for the three months ended December 31, 2014. The three months ended December 31, 2015 included charges totaling $39.4 million of reorganization items.

For the year ended December 31, 2015, Vantage reported net income attributable to shareholder of $17.2 million as compared to earnings of $92.9 million for the year ended December 31, 2014. The year ended December 31, 2015 includes gains on the early retirement of debt of approximately $10.8 million and approximately of $39.4 million of reorganization items as compared to the year ended December 31, 2014 which included approximately $4.4 million of gains from the early retirement of debt.

Vantage filed a Joint Prepackaged Chapter 11 Plan of Reorganization on December 3, 2015 and emerged from those proceedings on February 10, 2016. In connection with the reorganization, Vantage recognized charges totaling approximately $39.4 million consisting primarily of the write-off of deferred financing costs and unamortized original issued debt discounts, and professional fees.

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 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 International  
(Debtor-In-Possession)  
Consolidated Statement of Operations  
(In thousands, except per share amounts)  
(Unaudited)  
   
  Three Months Ended December 31,     Twelve Months Ended December 31,  
  2015     2014     2015     2014  
Revenue                              
  Contract drilling services $ 118,714     $ 204,304       726,717       807,164  
  Management fees   1,795       1,923       7,501       21,258  
  Reimbursables   7,893       13,207       38,047       54,482  
    Total revenue   128,402       219,434       772,265       882,904  
Operating costs and expenses                              
  Operating costs   75,601       106,853       359,610       405,697  
  General and administrative   7,572       5,609       25,322       25,390  
  Depreciation   32,191       31,715       127,359       126,610  
    Total operating costs and expenses   115,364       144,177       512,291       557,697  
Income from operations   13,038       75,257       259,974       325,207  
Other income (expense)                              
  Interest income   30       13       84       70  
  Interest expense and other financing charges   (35,424 )     (47,690 )     (173,634 )     (196,159 )
  Gain on debt extinguishment   -       4,870       10,823       4,408  
  Other, net   1,945       (1,507 )     4,231       (596 )
  Reorganization items   (39,354 )     -       (39,354 )     -  
    Total other income (expense)   (72,803 )     (44,314 )     (197,850 )     (192,277 )
Income (loss) before income taxes   (59,765 )     30,943       62,124       132,930  
Income tax provision (benefit)   (55,701 )     4,116       39,870       39,817  
Net income (loss)   (4,064 )     26,827       22,254       93,113  
Net income (loss) attributable to noncontrolling interests   4,689       (743 )     5,036       257  
Net income (loss) attributable to VDI $ (8,753 )   $ 27,570     $ 17,218     $ 92,856  
                               
   
   
Vantage Drilling International  
Supplemental Operating Data  
(Unaudited, in thousands, except percentages)  
   
  Three Months Ended December 31,     Twelve Months Ended December 31,  
  2015     2014     2015     2014  
Operating costs and expenses                              
Jackups $ 15,008     $ 24,191     $ 80,009     $ 94,748  
Deepwater   47,491       64,834       224,516       235,083  
Operations support   7,092       8,879       28,785       37,942  
Reimbursables   6,010       8,949       26,300       37,924  
  $ 75,601     $ 106,853     $ 359,610     $ 405,697  
                               
Utilization                              
Jackups   64.0 %     100.0 %     76.7 %     99.2 %
Deepwater   53.4 %     86.5 %     83.0 %     85.1 %
                               
                               
                               
Vantage Drilling International  
(Debtor-In-Possession)  
Consolidated Balance Sheet  
(In thousands, except share information)  
(Unaudited)  
           
  December 31,
2015
    December 31,
2014
 
ASSETS              
Current assets              
  Cash and cash equivalents $ 203,420     $ 75,801  
  Trade receivables   70,722       151,625  
  Inventory   64,495       65,893  
  Prepaid expenses and other current assets   22,404       28,019  
    Total current assets   361,041       321,338  
Property and equipment              
  Property and equipment   3,481,006       3,439,242  
  Accumulated depreciation   (532,619 )     (406,674 )
    Property and equipment, net   2,948,387       3,032,568  
Other assets              
  Other assets   22,904       71,226  
    Total other assets   22,904       71,226  
Total assets $ 3,332,332     $ 3,425,132  
               
LIABILITIES AND SHAREHOLDER'S EQUITY              
Current liabilities              
  Accounts payable $ 49,437     $ 214,685  
  Accrued liabilities   21,702       73,195  
  Current maturities of long-term debt and revolving credit agreement   -       53,500  
  Note payable to parent   61,477       -  
    Total current liabilities   132,616       341,380  
Long-term debt, net of discount of $0 and $8,074   -       2,497,103  
Other long-term liabilities   33,249       85,243  
Liabilities subject to compromise   2,694,456       -  
Commitments and contingencies              
Shareholders' equity              
  Ordinary shares, $0.001 par value, 50 million shares authorized; 1,000 shares issued and outstanding   -       -  
  Additional paid-in capital   595,119       646,270  
  Accumulated deficit   (138,363 )     (155,581 )
    Total VDI shareholder's equity   456,756       490,689  
Noncontolling interests   15,255       10,717  
  Total equity   472,011       501,406  
Total liabilities and equity $ 3,332,332     $ 3,425,132  
               
               
               
Vantage Drilling International  
(Debtor-In-Possession)  
Consolidated Statement of Cash Flows  
(In thousands)  
(Unaudited)  
   
  Year Ended December 31,  
  2015     2014  
CASH FLOWS FROM OPERATING ACTIVITIES              
Net income $ 22,254     $ 93,113  
Adjustments to reconcile net income to net cash provided by operating activities:              
  Depreciation expense   127,359       126,610  
  Amortization of debt financing costs   7,800       10,022  
  Amortization of debt discount   2,242       2,997  
  Reorganization items; debt discount and issuance costs write-off   37,129       -  
  Non-cash gain on debt extinguishment   (10,814 )     (4,409 )
  Accelerated deferred mobilization income   (21,508 )     -  
  Deferred income tax expense (benefit)   2,122       (305 )
  Loss on disposal of assets   1,108       3,008  
Changes in operating assets and liabilities:              
  Restricted cash   -       2,125  
  Trade receivables   80,903       12,399  
  Inventory   1,397       (10,088 )
  Prepaid expenses and other current assets   5,991       (4,660 )
  Other assets   8,549       5,275  
  Accounts payable   (154,922 )     (40,580 )
  Accrued liabilities and other long-term liabilities   (17,023 )     44,217  
    Net cash provided by operating activities   92,587       239,724  
CASH FLOWS FROM INVESTING ACTIVITIES              
  Additions to property and equipment   (46,490 )     (35,693 )
    Net cash used in investing activities   (46,490 )     (35,693 )
CASH FLOWS FROM FINANCING ACTIVITIES              
  Repayment of long-term debt   (67,980 )     (167,561 )
  Distributions to parent   (498 )     (995 )
  Proceeds from (repayment of) revolving credit agreement, net   150,000       (10,000 )
    Net cash provided by (used in) financing activities   81,522       (178,556 )
    Net increase in cash and cash equivalents   127,619       25,475  
  Cash and cash equivalents-beginning of year   75,801       50,326  
  Cash and cash equivalents-end of year $ 203,420     $ 75,801