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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Helix Energy Solutions Group Inc | NYSE:HLX | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 10.95 | 0 | 09:01:25 |
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þ
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Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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¨
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Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
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Minnesota
(State or other jurisdiction
of incorporation or organization)
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95–3409686
(I.R.S. Employer
Identification No.)
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3505 West Sam Houston Parkway North
Suite 400
Houston, Texas
(Address of principal executive offices)
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77043
(Zip Code)
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Large accelerated filer
þ
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Accelerated filer
¨
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Non-accelerated filer
¨
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Smaller reporting company
¨
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(Do not check if a smaller reporting company)
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PART I.
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FINANCIAL INFORMATION
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PAGE
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Item 1.
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Financial Statements:
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Item 2.
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Item 3.
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Item 4.
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PART II.
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OTHER INFORMATION
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Item 1.
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Item 2.
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Item 6.
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June 30,
2016 |
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December 31,
2015 |
||||
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(Unaudited)
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|
||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
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492,190
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|
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$
|
494,192
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Accounts receivable:
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|
|
||||
Trade, net of allowance for uncollectible accounts of $316 and $350, respectively
|
59,888
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76,287
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Unbilled revenue and other
|
16,216
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20,465
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Current deferred tax assets
|
14,211
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53,573
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Income tax receivable
|
21,311
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|
|
—
|
|
||
Other current assets
|
41,465
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|
|
39,518
|
|
||
Total current assets
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645,281
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|
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684,035
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||
Property and equipment
|
2,565,180
|
|
|
2,544,857
|
|
||
Less accumulated depreciation
|
(983,218
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)
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|
(941,848
|
)
|
||
Property and equipment, net
|
1,581,962
|
|
|
1,603,009
|
|
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Other assets:
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|
||||
Equity investments
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—
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|
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26,200
|
|
||
Goodwill
|
45,107
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|
|
45,107
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Other assets, net
|
42,018
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|
|
41,608
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Total assets
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$
|
2,314,368
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$
|
2,399,959
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LIABILITIES AND SHAREHOLDERS' EQUITY
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|||||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
48,013
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$
|
65,370
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Accrued liabilities
|
71,009
|
|
|
71,641
|
|
||
Income tax payable
|
—
|
|
|
2,261
|
|
||
Current maturities of long-term debt
|
71,786
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|
|
71,640
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|
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Total current liabilities
|
190,808
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|
210,912
|
|
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Long-term debt
|
638,985
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|
677,695
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Deferred tax liabilities
|
166,557
|
|
|
180,974
|
|
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Other non-current liabilities
|
52,829
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|
|
51,415
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|
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Total liabilities
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1,049,179
|
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|
1,120,996
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Commitments and contingencies
|
|
|
|
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Shareholders
’
equity:
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|
|
||||
Common stock, no par, 240,000 shares authorized, 112,627 and 106,289 shares issued, respectively
|
986,239
|
|
|
945,565
|
|
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Retained earnings
|
365,805
|
|
|
404,299
|
|
||
Accumulated other comprehensive loss
|
(86,855
|
)
|
|
(70,901
|
)
|
||
Total shareholders
’
equity
|
1,265,189
|
|
|
1,278,963
|
|
||
Total liabilities and shareholders
’
equity
|
$
|
2,314,368
|
|
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$
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2,399,959
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Three Months Ended
June 30, |
||||||
|
2016
|
|
2015
|
||||
|
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|
||||
Net revenues
|
$
|
107,267
|
|
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$
|
166,016
|
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Cost of sales
|
101,609
|
|
|
141,808
|
|
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Gross profit
|
5,658
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|
|
24,208
|
|
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Selling, general and administrative expenses
|
(14,953
|
)
|
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(16,534
|
)
|
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Income (loss) from operations
|
(9,295
|
)
|
|
7,674
|
|
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Equity in losses of investments
|
(121
|
)
|
|
(323
|
)
|
||
Net interest expense
|
(7,480
|
)
|
|
(5,235
|
)
|
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Gain on repurchase of long-term debt
|
302
|
|
|
—
|
|
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Other income (expense), net
|
1,308
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|
|
(5,036
|
)
|
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Other income – oil and gas
|
396
|
|
|
899
|
|
||
Loss before income taxes
|
(14,890
|
)
|
|
(2,021
|
)
|
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Income tax provision (benefit)
|
(4,219
|
)
|
|
614
|
|
||
Net loss
|
$
|
(10,671
|
)
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$
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(2,635
|
)
|
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|
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Loss per share of common stock:
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|
||||
Basic
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$
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(0.10
|
)
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$
|
(0.03
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)
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Diluted
|
$
|
(0.10
|
)
|
|
$
|
(0.03
|
)
|
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|
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Weighted average common shares outstanding:
|
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|
||||
Basic
|
107,767
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|
|
105,357
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Diluted
|
107,767
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|
|
105,357
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Six Months Ended
June 30, |
||||||
|
2016
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|
2015
|
||||
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|
||||
Net revenues
|
$
|
198,306
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|
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$
|
355,657
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Cost of sales
|
209,578
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|
|
296,502
|
|
||
Gross profit (loss)
|
(11,272
|
)
|
|
59,155
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|
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Selling, general and administrative expenses
|
(28,779
|
)
|
|
(29,153
|
)
|
||
Income (loss) from operations
|
(40,051
|
)
|
|
30,002
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|
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Equity in losses of investments
|
(244
|
)
|
|
(302
|
)
|
||
Net interest expense
|
(18,164
|
)
|
|
(9,305
|
)
|
||
Gain on repurchase of long-term debt
|
302
|
|
|
—
|
|
||
Other income (expense), net
|
3,188
|
|
|
(6,192
|
)
|
||
Other income – oil and gas
|
2,968
|
|
|
3,825
|
|
||
Income (loss) before income taxes
|
(52,001
|
)
|
|
18,028
|
|
||
Income tax provision (benefit)
|
(13,507
|
)
|
|
1,021
|
|
||
Net income (loss)
|
$
|
(38,494
|
)
|
|
$
|
17,007
|
|
|
|
|
|
||||
Earnings (loss) per share of common stock:
|
|
|
|
||||
Basic
|
$
|
(0.36
|
)
|
|
$
|
0.16
|
|
Diluted
|
$
|
(0.36
|
)
|
|
$
|
0.16
|
|
|
|
|
|
||||
Weighted average common shares outstanding:
|
|
|
|
||||
Basic
|
106,838
|
|
|
105,324
|
|
||
Diluted
|
106,838
|
|
|
105,324
|
|
|
Three Months Ended
June 30, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Net loss
|
$
|
(10,671
|
)
|
|
$
|
(2,635
|
)
|
Other comprehensive income (loss), net of tax:
|
|
|
|
||||
Unrealized gain (loss) on hedges arising during the period
|
(2,344
|
)
|
|
3,346
|
|
||
Reclassification adjustments for loss included in net loss
|
3,054
|
|
|
3,258
|
|
||
Income taxes on unrealized (gain) loss on hedges
|
(236
|
)
|
|
(2,311
|
)
|
||
Unrealized gain on hedges, net of tax
|
474
|
|
|
4,293
|
|
||
Foreign currency translation gain (loss)
|
(14,641
|
)
|
|
15,889
|
|
||
Other comprehensive income (loss), net of tax
|
(14,167
|
)
|
|
20,182
|
|
||
Comprehensive income (loss)
|
$
|
(24,838
|
)
|
|
$
|
17,547
|
|
|
Six Months Ended
June 30, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Net income (loss)
|
$
|
(38,494
|
)
|
|
$
|
17,007
|
|
Other comprehensive loss, net of tax:
|
|
|
|
||||
Unrealized gain (loss) on hedges arising during the period
|
1,032
|
|
|
(8,365
|
)
|
||
Reclassification adjustments for loss on hedges included in net income (loss)
|
6,494
|
|
|
4,931
|
|
||
Income taxes on unrealized (gain) loss on hedges
|
(2,553
|
)
|
|
1,202
|
|
||
Unrealized gain (loss) on hedges, net of tax
|
4,973
|
|
|
(2,232
|
)
|
||
Foreign currency translation gain (loss) arising during the period
|
(21,216
|
)
|
|
2,020
|
|
||
Reclassification adjustment for translation loss realized upon liquidation
|
289
|
|
|
—
|
|
||
Foreign currency translation gain (loss)
|
(20,927
|
)
|
|
2,020
|
|
||
Other comprehensive loss, net of tax
|
(15,954
|
)
|
|
(212
|
)
|
||
Comprehensive income (loss)
|
$
|
(54,448
|
)
|
|
$
|
16,795
|
|
|
Six Months Ended
June 30, |
||||||
|
2016
|
|
2015
|
||||
Cash flows from operating activities:
|
|
|
|
||||
Net income (loss)
|
$
|
(38,494
|
)
|
|
$
|
17,007
|
|
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
||||
Depreciation and amortization
|
57,239
|
|
|
53,528
|
|
||
Amortization of debt issuance costs
|
5,138
|
|
|
2,596
|
|
||
Share-based compensation
|
2,867
|
|
|
3,515
|
|
||
Amortization of debt discount
|
3,134
|
|
|
2,928
|
|
||
Deferred income taxes
|
(10,047
|
)
|
|
(2,454
|
)
|
||
Excess tax benefit from share-based compensation
|
—
|
|
|
(86
|
)
|
||
Equity in losses of investments
|
244
|
|
|
—
|
|
||
Gain on repurchase of long-term debt
|
(302
|
)
|
|
—
|
|
||
Unrealized (gain) loss and ineffectiveness on derivative contracts, net
|
(6,147
|
)
|
|
1,941
|
|
||
Changes in operating assets and liabilities:
|
|
|
|
||||
Accounts receivable, net
|
19,062
|
|
|
(29,006
|
)
|
||
Other current assets
|
(3,055
|
)
|
|
11,904
|
|
||
Income tax receivable, net of income tax payable
|
8,843
|
|
|
(9,472
|
)
|
||
Accounts payable and accrued liabilities
|
(7,979
|
)
|
|
(35,318
|
)
|
||
Other noncurrent, net
|
(5,614
|
)
|
|
(14,050
|
)
|
||
Net cash provided by operating activities
|
24,889
|
|
|
3,033
|
|
||
|
|
|
|
||||
Cash flows from investing activities:
|
|
|
|
||||
Capital expenditures
|
(57,563
|
)
|
|
(232,872
|
)
|
||
Distributions from equity investments, net of earnings
|
1,200
|
|
|
3,842
|
|
||
Proceeds from sale of equity investment
|
25,000
|
|
|
—
|
|
||
Proceeds from sale of assets
|
10,887
|
|
|
7,500
|
|
||
Net cash used in investing activities
|
(20,476
|
)
|
|
(221,530
|
)
|
||
|
|
|
|
||||
Cash flows from financing activities:
|
|
|
|
||||
Proceeds from Nordea Q5000 Loan
|
—
|
|
|
250,000
|
|
||
Repayment of Nordea Q5000 Loan
|
(17,858
|
)
|
|
—
|
|
||
Repayment of Term Loan
|
(15,000
|
)
|
|
(7,500
|
)
|
||
Repayment of MARAD Debt
|
(2,927
|
)
|
|
(2,788
|
)
|
||
Repurchase of Convertible Senior Notes due 2032
|
(6,480
|
)
|
|
—
|
|
||
Debt issuance costs
|
(1,230
|
)
|
|
(1,533
|
)
|
||
Net proceeds from issuance of common stock
|
38,773
|
|
|
—
|
|
||
Repurchase of common stock
|
(187
|
)
|
|
(1,056
|
)
|
||
Excess tax benefit from share-based compensation
|
—
|
|
|
86
|
|
||
Proceeds from issuance of ESPP shares
|
600
|
|
|
2,512
|
|
||
Net cash provided by (used in) financing activities
|
(4,309
|
)
|
|
239,721
|
|
||
|
|
|
|
||||
Effect of exchange rate changes on cash and cash equivalents
|
(2,106
|
)
|
|
2,346
|
|
||
Net increase (decrease) in cash and cash equivalents
|
(2,002
|
)
|
|
23,570
|
|
||
Cash and cash equivalents:
|
|
|
|
||||
Balance, beginning of year
|
494,192
|
|
|
476,492
|
|
||
Balance, end of period
|
$
|
492,190
|
|
|
$
|
500,062
|
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
|
|
|
||||
Note receivable
(1)
|
$
|
10,000
|
|
|
$
|
10,000
|
|
Prepaid insurance
|
222
|
|
|
5,433
|
|
||
Other prepaids
|
12,689
|
|
|
10,142
|
|
||
Deferred costs
|
4,903
|
|
|
609
|
|
||
Spare parts inventory
|
4,601
|
|
|
4,985
|
|
||
Value added tax receivable
|
8,774
|
|
|
7,842
|
|
||
Other
|
276
|
|
|
507
|
|
||
Total other current assets
|
$
|
41,465
|
|
|
$
|
39,518
|
|
(1)
|
Relates to the balance of the promissory note we received in connection with the sale of our former Ingleside spoolbase in January 2014. Interest on the note is payable quarterly at a rate of
6%
per annum. Under the terms of the note, the remaining
$10 million
principal balance is required to be paid on December 31, 2016.
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
|
|
|
||||
Deferred dry dock expenses, net
|
$
|
12,472
|
|
|
$
|
19,615
|
|
Deferred costs
|
11,024
|
|
|
—
|
|
||
Deferred financing costs, net
(1)
|
4,823
|
|
|
7,863
|
|
||
Charter fee deposit (Note 12)
|
12,544
|
|
|
12,544
|
|
||
Other
|
1,155
|
|
|
1,586
|
|
||
Total other assets, net
|
$
|
42,018
|
|
|
$
|
41,608
|
|
(1)
|
Represents unamortized debt issuance costs related to our Revolving Credit Facility (Note 6).
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
|
|
|
||||
Accrued payroll and related benefits
|
$
|
14,671
|
|
|
$
|
14,775
|
|
Deferred revenue
|
13,400
|
|
|
12,841
|
|
||
Accrued interest
|
4,155
|
|
|
4,854
|
|
||
Derivative liability (Note 14)
|
20,538
|
|
|
23,192
|
|
||
Taxes payable excluding income tax payable
|
9,988
|
|
|
8,136
|
|
||
Other
|
8,257
|
|
|
7,843
|
|
||
Total accrued liabilities
|
$
|
71,009
|
|
|
$
|
71,641
|
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
|
|
|
||||
Loss in excess of equity investment (Note 5)
|
$
|
8,315
|
|
|
$
|
8,308
|
|
Deferred gain on sale of property (Note 2)
|
6,430
|
|
|
—
|
|
||
Deferred revenue
|
6,333
|
|
|
—
|
|
||
Derivative liability (Note 14)
|
28,276
|
|
|
39,709
|
|
||
Other
|
3,475
|
|
|
3,398
|
|
||
Total other non-current liabilities
|
$
|
52,829
|
|
|
$
|
51,415
|
|
|
Six Months Ended
June 30, |
||||||
|
2016
|
|
2015
|
||||
|
|
|
|
||||
Interest paid, net of interest capitalized
|
$
|
10,321
|
|
|
$
|
3,729
|
|
Income taxes paid
|
$
|
3,845
|
|
|
$
|
13,285
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Deepwater Gateway
|
$
|
—
|
|
|
$
|
1,700
|
|
|
$
|
1,200
|
|
|
$
|
2,700
|
|
Independence Hub
|
—
|
|
|
440
|
|
|
—
|
|
|
840
|
|
||||
Total
|
$
|
—
|
|
|
$
|
2,140
|
|
|
$
|
1,200
|
|
|
$
|
3,540
|
|
|
Term
Loan
|
|
2032
Notes
(1)
|
|
MARAD
Debt
|
|
Nordea
Q5000 Loan
|
|
Total
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Less than one year
|
$
|
30,000
|
|
|
$
|
—
|
|
|
$
|
6,072
|
|
|
$
|
35,714
|
|
|
$
|
71,786
|
|
One to two years
|
30,000
|
|
|
—
|
|
|
6,375
|
|
|
35,715
|
|
|
72,090
|
|
|||||
Two to three years
|
180,000
|
|
|
—
|
|
|
6,693
|
|
|
35,714
|
|
|
222,407
|
|
|||||
Three to four years
|
—
|
|
|
—
|
|
|
7,027
|
|
|
107,142
|
|
|
114,169
|
|
|||||
Four to five years
|
—
|
|
|
—
|
|
|
7,378
|
|
|
—
|
|
|
7,378
|
|
|||||
Over five years
|
—
|
|
|
192,750
|
|
|
52,676
|
|
|
—
|
|
|
245,426
|
|
|||||
Total debt
|
240,000
|
|
|
192,750
|
|
|
86,221
|
|
|
214,285
|
|
|
733,256
|
|
|||||
Current maturities
|
(30,000
|
)
|
|
—
|
|
|
(6,072
|
)
|
|
(35,714
|
)
|
|
(71,786
|
)
|
|||||
Long-term debt, less current maturities
|
210,000
|
|
|
192,750
|
|
|
80,149
|
|
|
178,571
|
|
|
661,470
|
|
|||||
Unamortized debt discount
(2)
|
—
|
|
|
(11,400
|
)
|
|
—
|
|
|
—
|
|
|
(11,400
|
)
|
|||||
Unamortized debt issuance costs
(3)
|
(1,855
|
)
|
|
(1,036
|
)
|
|
(5,245
|
)
|
|
(2,949
|
)
|
|
(11,085
|
)
|
|||||
Long-term debt
|
$
|
208,145
|
|
|
$
|
180,314
|
|
|
$
|
74,904
|
|
|
$
|
175,622
|
|
|
$
|
638,985
|
|
(1)
|
Beginning in March 2018, the holders of our Convertible Senior Notes due 2032 may require us to repurchase these notes or we may at our option elect to repurchase these notes. The notes will mature in
March 2032
.
|
(2)
|
Our Convertible Senior Notes due 2032 will increase to their face amount through accretion of non-cash interest charges through March 2018.
|
(3)
|
Debt issuance costs are amortized over the life of the applicable debt agreement.
|
(a)
|
The minimum permitted Consolidated Interest Coverage Ratio was revised as follows:
|
Four Fiscal Quarters Ending
|
Minimum Consolidated
Interest Coverage Ratio
|
||
|
|
|
|
March 31, 2016 through and including September 30, 2016
|
2.50
|
|
to 1.00
|
December 31, 2016 through and including March 31, 2017
|
2.75
|
|
to 1.00
|
June 30, 2017 and each fiscal quarter thereafter
|
3.00
|
|
to 1.00
|
(b)
|
The maximum permitted Consolidated Leverage Ratio was revised as follows:
|
Four Fiscal Quarters Ending
|
Maximum Consolidated
Leverage Ratio
|
||
|
|
|
|
March 31, 2016
|
5.50
|
|
to 1.00
|
June 30, 2016
|
5.25
|
|
to 1.00
|
September 30, 2016 through and including December 31, 2016
|
5.00
|
|
to 1.00
|
March 31, 2017
|
4.75
|
|
to 1.00
|
June 30, 2017
|
4.25
|
|
to 1.00
|
September 30, 2017
|
3.75
|
|
to 1.00
|
December 31, 2017 and each fiscal quarter thereafter
|
3.50
|
|
to 1.00
|
(c)
|
A new financial covenant was established requiring us to maintain a minimum cash balance if our Consolidated Leverage Ratio is 3.50x or greater, as described below. This minimum cash balance is not required to be maintained in any particular bank account or to be segregated from other cash balances in bank accounts that we use in our ordinary course of business. Because the use of this cash is not legally restricted notwithstanding this maintenance covenant, we present it as cash and cash equivalents on our balance sheet. As of
June 30, 2016
, we needed to maintain an aggregate cash balance of at least
$150 million
in order to comply with this covenant.
|
Consolidated Leverage Ratio
|
Minimum Cash
|
|
|
|
|
Greater than or equal to 4.50x
|
$150,000,000.00
|
|
Greater than or equal to 4.00x but less than 4.50x
|
$100,000,000.00
|
|
Greater than or equal to 3.50x but less than 4.00x
|
$50,000,000.00
|
|
Less than 3.50x
|
$0.00
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Interest expense
|
$
|
10,435
|
|
|
$
|
9,751
|
|
|
$
|
23,479
|
|
|
$
|
18,160
|
|
Interest income
|
(436
|
)
|
|
(457
|
)
|
|
(880
|
)
|
|
(1,107
|
)
|
||||
Capitalized interest
|
(2,519
|
)
|
|
(4,059
|
)
|
|
(4,435
|
)
|
|
(7,748
|
)
|
||||
Net interest expense
|
$
|
7,480
|
|
|
$
|
5,235
|
|
|
$
|
18,164
|
|
|
$
|
9,305
|
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
|
|
|
||||
Cumulative foreign currency translation adjustment
|
$
|
(63,937
|
)
|
|
$
|
(43,010
|
)
|
Unrealized loss on hedges, net
(1)
|
(22,918
|
)
|
|
(27,891
|
)
|
||
Accumulated other comprehensive loss
|
$
|
(86,855
|
)
|
|
$
|
(70,901
|
)
|
(1)
|
Amounts relate to foreign currency hedges for the
Grand Canyon
,
Grand Canyon II
and
Grand Canyon III
charters as well as interest rate swap contracts for the Term Loan and the Nordea Q5000 Loan, and are net of deferred income taxes totaling
$12.5 million
at
June 30, 2016
and
$15.1 million
at
December 31, 2015
(Note 14).
|
|
Three Months Ended
June 30, 2016 |
|
Three Months Ended
June 30, 2015 |
||||||||||
|
Income
|
|
Shares
|
|
Income
|
|
Shares
|
||||||
Basic:
|
|
|
|
|
|
|
|
||||||
Net loss
|
$
|
(10,671
|
)
|
|
|
|
$
|
(2,635
|
)
|
|
|
||
Less: Undistributed earnings allocated to participating securities
|
—
|
|
|
|
|
—
|
|
|
|
||||
Undistributed loss allocated to common shares
|
$
|
(10,671
|
)
|
|
107,767
|
|
|
$
|
(2,635
|
)
|
|
105,357
|
|
|
|
|
|
|
|
|
|
||||||
Diluted:
|
|
|
|
|
|
|
|
||||||
Undistributed loss allocated to common shares
|
$
|
(10,671
|
)
|
|
107,767
|
|
|
$
|
(2,635
|
)
|
|
105,357
|
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||
Share-based awards other than participating securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Undistributed earnings reallocated to participating securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Net loss
|
$
|
(10,671
|
)
|
|
107,767
|
|
|
$
|
(2,635
|
)
|
|
105,357
|
|
|
Six Months Ended
June 30, 2016 |
|
Six Months Ended
June 30, 2015 |
||||||||||
|
Income
|
|
Shares
|
|
Income
|
|
Shares
|
||||||
Basic:
|
|
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
(38,494
|
)
|
|
|
|
$
|
17,007
|
|
|
|
||
Less undistributed earnings allocated to participating securities
|
—
|
|
|
|
|
(96
|
)
|
|
|
||||
Undistributed earnings (loss) allocated to common shares
|
$
|
(38,494
|
)
|
|
106,838
|
|
|
$
|
16,911
|
|
|
105,324
|
|
|
|
|
|
|
|
|
|
||||||
Diluted:
|
|
|
|
|
|
|
|
||||||
Undistributed earnings (loss) allocated to common shares
|
$
|
(38,494
|
)
|
|
106,838
|
|
|
$
|
16,911
|
|
|
105,324
|
|
Effect of dilutive securities:
|
|
|
|
|
|
|
|
||||||
Share-based awards other than participating securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Undistributed earnings reallocated to participating securities
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Net income (loss)
|
$
|
(38,494
|
)
|
|
106,838
|
|
|
$
|
16,911
|
|
|
105,324
|
|
|
Three Months Ended
|
|
Six Months Ended
|
||
|
June 30, 2016
|
||||
|
|
|
|
||
Diluted shares (as reported)
|
107,767
|
|
|
106,838
|
|
Share-based awards
|
377
|
|
|
187
|
|
Total
|
108,144
|
|
|
107,025
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||
|
|
|
|
|
|
|
|
||||
2032 Notes
|
7,959
|
|
|
7,995
|
|
|
7,977
|
|
|
7,995
|
|
Date of Grant
|
|
|
Shares
|
|
|
|
Grant Date
Fair Value
Per Share
|
|
|
Vesting Period
|
|||
|
|
|
|
|
|
|
|
|
|
|
|||
January 4, 2016
(1)
|
|
|
1,143,062
|
|
|
|
|
$
|
5.26
|
|
|
|
33% per year over three years
|
January 4, 2016
(2)
|
|
|
1,143,062
|
|
|
|
|
$
|
7.13
|
|
|
|
100% on January 3, 2019
|
January 4, 2016
(3)
|
|
|
11,763
|
|
|
|
|
$
|
5.26
|
|
|
|
100% on January 1, 2018
|
February 1, 2016
(1)
|
|
|
18,610
|
|
|
|
|
$
|
4.03
|
|
|
|
33% per year over three years
|
February 1, 2016
(2)
|
|
|
18,610
|
|
|
|
|
$
|
7.13
|
|
|
|
100% on January 31, 2019
|
April 1, 2016
(3)
|
|
|
13,727
|
|
|
|
|
$
|
5.60
|
|
|
|
100% on January 1, 2018
|
(1)
|
Reflects the grant of restricted stock to our executive officers and select management employees.
|
(2)
|
Reflects the grant of performance share units (“PSUs”) to our executive officers and select management employees. The PSUs provide for an award based on the performance of our common stock over a
three
-year period with the maximum amount of the award being
200%
of the original awarded PSUs and the minimum amount being
zero
. The vested PSUs may be settled in either cash or shares of our common stock at the discretion of the Compensation Committee of our Board of Directors (the “Board”).
|
(3)
|
Reflects the grant of restricted stock to certain members of our Board who have made an election to take their quarterly fees in stock in lieu of cash.
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
Net revenues —
|
|
|
|
|
|
|
|
||||||||
Well Intervention
|
$
|
59,919
|
|
|
$
|
85,675
|
|
|
$
|
105,975
|
|
|
$
|
189,726
|
|
Robotics
|
38,914
|
|
|
75,101
|
|
|
70,908
|
|
|
155,272
|
|
||||
Production Facilities
|
18,957
|
|
|
20,293
|
|
|
37,439
|
|
|
38,678
|
|
||||
Intercompany elimination
|
(10,523
|
)
|
|
(15,053
|
)
|
|
(16,016
|
)
|
|
(28,019
|
)
|
||||
Total
|
$
|
107,267
|
|
|
$
|
166,016
|
|
|
$
|
198,306
|
|
|
$
|
355,657
|
|
|
|
|
|
|
|
|
|
||||||||
Income (loss) from operations —
|
|
|
|
|
|
|
|
||||||||
Well Intervention
|
$
|
(538
|
)
|
|
$
|
4,135
|
|
|
$
|
(17,226
|
)
|
|
$
|
18,929
|
|
Robotics
|
(8,823
|
)
|
|
4,303
|
|
|
(21,573
|
)
|
|
13,760
|
|
||||
Production Facilities
|
9,730
|
|
|
8,444
|
|
|
16,913
|
|
|
13,022
|
|
||||
Corporate and other
|
(9,827
|
)
|
|
(9,009
|
)
|
|
(18,496
|
)
|
|
(15,616
|
)
|
||||
Intercompany elimination
|
163
|
|
|
(199
|
)
|
|
331
|
|
|
(93
|
)
|
||||
Total
|
$
|
(9,295
|
)
|
|
$
|
7,674
|
|
|
$
|
(40,051
|
)
|
|
$
|
30,002
|
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Well Intervention
|
$
|
2,201
|
|
|
$
|
6,417
|
|
|
$
|
2,842
|
|
|
$
|
11,363
|
|
Robotics
|
8,322
|
|
|
8,636
|
|
|
13,174
|
|
|
16,656
|
|
||||
Total
|
$
|
10,523
|
|
|
$
|
15,053
|
|
|
$
|
16,016
|
|
|
$
|
28,019
|
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
|
|
|
||||
Well Intervention
|
$
|
1,475,066
|
|
|
$
|
1,484,109
|
|
Robotics
|
240,393
|
|
|
274,926
|
|
||
Production Facilities
|
158,999
|
|
|
182,007
|
|
||
Corporate and other
|
439,910
|
|
|
458,917
|
|
||
Total
|
$
|
2,314,368
|
|
|
$
|
2,399,959
|
|
•
|
Level 1. Observable inputs such as quoted prices in active markets;
|
•
|
Level 2. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
|
•
|
Level 3. Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions.
|
(a)
|
Market Approach. Prices and other relevant information generated by market transactions involving identical or comparable assets or liabilities.
|
(b)
|
Cost Approach. Amount that would be required to replace the service capacity of an asset (replacement cost).
|
(c)
|
Income Approach. Techniques to convert expected future cash flows to a single present amount based on market expectations (including present value techniques, option-pricing and excess earnings models).
|
|
Fair Value Measurements at
June 30, 2016 Using |
|
|
|
|
||||||||||||
|
Level 1
|
|
Level 2
(1)
|
|
Level 3
|
|
Total
|
|
Valuation
Technique
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
$
|
—
|
|
|
$
|
45,286
|
|
|
$
|
—
|
|
|
$
|
45,286
|
|
|
(c)
|
Interest rate swaps
|
—
|
|
|
3,528
|
|
|
—
|
|
|
3,528
|
|
|
(c)
|
||||
Total liability
|
$
|
—
|
|
|
$
|
48,814
|
|
|
$
|
—
|
|
|
$
|
48,814
|
|
|
|
|
Fair Value Measurements at
December 31, 2015 Using |
|
|
|
|
||||||||||||
|
Level 1
|
|
Level 2
(1)
|
|
Level 3
|
|
Total
|
|
Valuation
Technique
|
||||||||
Assets:
|
|
|
|
|
|
|
|
|
|
||||||||
Interest rate swaps
|
$
|
—
|
|
|
$
|
413
|
|
|
$
|
—
|
|
|
$
|
413
|
|
|
(c)
|
|
|
|
|
|
|
|
|
|
|
||||||||
Liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
—
|
|
|
61,427
|
|
|
—
|
|
|
61,427
|
|
|
(c)
|
||||
Interest rate swaps
|
—
|
|
|
1,473
|
|
|
—
|
|
|
1,473
|
|
|
(c)
|
||||
Total net liability
|
$
|
—
|
|
|
$
|
62,487
|
|
|
$
|
—
|
|
|
$
|
62,487
|
|
|
|
(1)
|
Unless otherwise indicated, the fair value of our Level 2 derivative instruments reflects our best estimate and is based upon exchange or over-the-counter quotations whenever they are available. Quoted valuations may not be available due to location differences or terms that extend beyond the period for which quotations are available. Where quotes are not available, we utilize other valuation techniques or models to estimate market values. These modeling techniques require us to make estimations of future prices, price correlation and market volatility and liquidity based on market data. Our actual results may differ from our estimates, and these differences could be positive or negative. See Note 14 for further discussions on the fair value of our derivative instruments.
|
|
June 30, 2016
|
|
December 31, 2015
|
||||||||||||
|
Carrying
Value
(1)
|
|
Fair
Value
(2)
|
|
Carrying
Value
(1)
|
|
Fair
Value
(2)
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Term Loan (matures June 2018)
|
$
|
240,000
|
|
|
$
|
237,300
|
|
|
$
|
255,000
|
|
|
$
|
248,467
|
|
Nordea Q5000 Loan (matures April 2020)
|
214,285
|
|
|
207,724
|
|
|
232,143
|
|
|
221,553
|
|
||||
MARAD Debt (matures February 2027)
|
86,221
|
|
|
98,233
|
|
|
89,148
|
|
|
104,897
|
|
||||
2032 Notes (mature March 2032)
|
192,750
|
|
|
169,620
|
|
|
200,000
|
|
|
150,250
|
|
||||
Total debt
|
$
|
733,256
|
|
|
$
|
712,877
|
|
|
$
|
776,291
|
|
|
$
|
725,167
|
|
(1)
|
Carrying value includes current maturities and excludes the related unamortized debt discount and debt issuance costs. See Note 6 for additional disclosures on our long-term debt.
|
(2)
|
The estimated fair value of the 2032 Notes was determined using Level 1 inputs under the market approach. The fair value of the Term Loan, the Nordea Q5000 Loan and the MARAD Debt was estimated using Level 2 fair value inputs under the market approach. The fair value of the Term Loan, the Nordea Q5000 Loan and the MARAD Debt was determined using a third party evaluation of the remaining average life and outstanding principal balance of the indebtedness as compared to other obligations in the marketplace with similar terms.
|
|
June 30, 2016
|
|
December 31, 2015
|
||||||||
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
||||
Asset Derivatives:
|
|
|
|
|
|
|
|
||||
Interest rate swaps
|
Other assets, net
|
|
$
|
—
|
|
|
Other assets, net
|
|
$
|
413
|
|
|
|
|
$
|
—
|
|
|
|
|
$
|
413
|
|
|
|
|
|
|
|
|
|
||||
Liability Derivatives:
|
|
|
|
|
|
|
|
||||
Foreign exchange contracts
|
Accrued liabilities
|
|
$
|
14,337
|
|
|
Accrued liabilities
|
|
$
|
14,955
|
|
Interest rate swaps
|
Accrued liabilities
|
|
1,629
|
|
|
Accrued liabilities
|
|
1,473
|
|
||
Foreign exchange contracts
|
Other non-current liabilities
|
|
18,254
|
|
|
Other non-current liabilities
|
|
28,458
|
|
||
Interest rate swaps
|
Other non-current liabilities
|
|
1,899
|
|
|
Other non-current liabilities
|
|
—
|
|
||
|
|
|
$
|
36,119
|
|
|
|
|
$
|
44,886
|
|
|
June 30, 2016
|
|
December 31, 2015
|
||||||||
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
||||
Liability Derivatives:
|
|
|
|
|
|
|
|
||||
Foreign exchange contracts
|
Accrued liabilities
|
|
$
|
4,572
|
|
|
Accrued liabilities
|
|
$
|
6,763
|
|
Foreign exchange contracts
|
Other non-current liabilities
|
|
8,123
|
|
|
Other non-current liabilities
|
|
11,251
|
|
||
|
|
|
$
|
12,695
|
|
|
|
|
$
|
18,014
|
|
|
Gain (Loss) Recognized in OCI
on Derivatives, Net of Tax
(Effective Portion)
|
||||||||||||||
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
$
|
674
|
|
|
$
|
5,002
|
|
|
$
|
6,496
|
|
|
$
|
(1,359
|
)
|
Interest rate swaps
|
(200
|
)
|
|
(709
|
)
|
|
(1,523
|
)
|
|
(873
|
)
|
||||
|
$
|
474
|
|
|
$
|
4,293
|
|
|
$
|
4,973
|
|
|
$
|
(2,232
|
)
|
|
Location of Loss Reclassified from
Accumulated OCI into Earnings
|
|
Loss Reclassified from
Accumulated OCI into Earnings
(Effective Portion)
|
||||||||||||||
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
Cost of sales
|
|
$
|
(2,507
|
)
|
|
$
|
(2,921
|
)
|
|
$
|
(5,370
|
)
|
|
$
|
(4,395
|
)
|
Interest rate swaps
|
Net interest expense
|
|
(547
|
)
|
|
(337
|
)
|
|
(1,124
|
)
|
|
(536
|
)
|
||||
|
|
|
$
|
(3,054
|
)
|
|
$
|
(3,258
|
)
|
|
$
|
(6,494
|
)
|
|
$
|
(4,931
|
)
|
|
Location of Gain (Loss) Recognized in Earnings
on Derivatives
|
|
Gain (Loss) Recognized
in Earnings on Derivatives
|
||||||||||||||
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
|||||||||||||
|
|
2016
|
|
2015
|
|
2016
|
|
2015
|
|||||||||
|
|
|
|
|
|
|
|
|
|
||||||||
Foreign exchange contracts
|
Other income (expense), net
|
|
$
|
(465
|
)
|
|
$
|
—
|
|
|
$
|
2,066
|
|
|
$
|
—
|
|
|
|
|
$
|
(465
|
)
|
|
$
|
—
|
|
|
$
|
2,066
|
|
|
$
|
—
|
|
•
|
statements regarding our business strategy or any other business plans, forecasts or objectives, any or all of which are subject to change;
|
•
|
statements regarding the construction, upgrades or acquisition of vessels or equipment and any anticipated costs related thereto, including the construction of our
Q7000
vessel, and the commissioning of our topside equipment onboard the
Siem Helix
1
chartered vessel and the construction of the
Siem Helix
2
to be used in connection with our contracts to provide well intervention services offshore Brazil (Note 12);
|
•
|
statements regarding projections of revenues, gross margin, expenses, earnings or losses, working capital, debt and liquidity, or other financial items;
|
•
|
statements regarding our backlog and long-term contracts;
|
•
|
statements regarding any financing transactions or arrangements, or ability to enter into such transactions;
|
•
|
statements regarding anticipated legislative, governmental, regulatory, administrative or other public body actions, requirements, permits or decisions;
|
•
|
statements regarding our trade receivables and their collectability;
|
•
|
statements regarding anticipated developments, industry trends, performance or industry ranking;
|
•
|
statements regarding general economic or political conditions, whether international, national or in the regional and local market areas in which we do business;
|
•
|
statements regarding our ability to retain key members of our senior management and key employees;
|
•
|
statements regarding the underlying assumptions related to any projection or forward-looking statement; and
|
•
|
any other statements that relate to non-historical or future information.
|
•
|
the impact of domestic and global economic conditions and the future impact of such conditions on the oil and gas industry and the demand for our services;
|
•
|
the impact of oil and gas price fluctuations and the cyclical nature of the oil and gas industry;
|
•
|
the impact of any potential cancellation, deferral or modification of our work or contracts by our customers;
|
•
|
unexpected delays in the delivery or chartering or acceptance testing of new vessels for our well intervention and robotics fleet, including the
Q7000
, the
Grand Canyon III
, and the
Siem Helix
1
and the
Siem Helix
2
to be used to perform contracted well intervention work offshore Brazil;
|
•
|
unexpected future capital expenditures, including the amount and nature thereof;
|
•
|
the effectiveness and timing of completion of our vessel upgrades and major maintenance items;
|
•
|
the effects of our indebtedness and our ability to reduce capital commitments;
|
•
|
the results of our continuing efforts to control costs and improve performance;
|
•
|
the success of our risk management activities;
|
•
|
the effects of competition;
|
•
|
the availability (or lack thereof) of capital (including any financing) to fund our business strategy and/or operations;
|
•
|
the impact of current and future laws and governmental regulations, including tax and accounting developments;
|
•
|
the effect of adverse weather conditions and/or other risks associated with marine operations;
|
•
|
the effectiveness of our current and future hedging activities;
|
•
|
the potential impact of a loss of one or more key employees; and
|
•
|
the impact of general, market, industry or business conditions.
|
•
|
worldwide economic activity, including available access to global capital and capital markets;
|
•
|
supply and demand for oil and natural gas, especially in the United States, Europe, China and India;
|
•
|
regional conflicts and economic and political conditions in the Middle East and other oil-producing regions;
|
•
|
actions taken by the Organization of Petroleum Exporting Countries (“OPEC”);
|
•
|
the availability and discovery rate of new oil and natural gas reserves in offshore areas;
|
•
|
the exploration and production of shale oil and natural gas;
|
•
|
the cost of offshore exploration for and production and transportation of oil and natural gas;
|
•
|
the level of excess production capacity;
|
•
|
the ability of oil and gas companies to generate funds or otherwise obtain external capital for exploration, development and production operations;
|
•
|
the sale and expiration dates of offshore leases in the United States and overseas;
|
•
|
technological advances affecting energy exploration, production, transportation and consumption;
|
•
|
potential acceleration of the development of alternative fuels;
|
•
|
shifts in end-customer preferences toward fuel efficiency and the use of natural gas;
|
•
|
weather conditions and natural disasters;
|
•
|
environmental and other governmental regulations; and
|
•
|
domestic and international tax laws, regulations and policies.
|
|
Three Months Ended
June 30, |
|
Six Months Ended
June 30, |
||||||||||||
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
|
|
|
|
|
|
|
|
||||||||
Net income (loss)
|
$
|
(10,671
|
)
|
|
$
|
(2,635
|
)
|
|
$
|
(38,494
|
)
|
|
$
|
17,007
|
|
Adjustments:
|
|
|
|
|
|
|
|
||||||||
Income tax provision (benefit)
|
(4,219
|
)
|
|
614
|
|
|
(13,507
|
)
|
|
1,021
|
|
||||
Net interest expense
|
7,480
|
|
|
5,235
|
|
|
18,164
|
|
|
9,305
|
|
||||
Gain on repurchase of long-term debt
|
(302
|
)
|
|
—
|
|
|
(302
|
)
|
|
—
|
|
||||
Other (income) expense, net
|
(1,308
|
)
|
|
5,036
|
|
|
(3,188
|
)
|
|
6,192
|
|
||||
Depreciation and amortization
|
25,674
|
|
|
27,439
|
|
|
57,239
|
|
|
53,528
|
|
||||
EBITDA
|
16,654
|
|
|
35,689
|
|
|
19,912
|
|
|
87,053
|
|
||||
Adjustments:
|
|
|
|
|
|
|
|
||||||||
Realized losses from cash settlements of ineffective foreign currency exchange contracts
|
(1,722
|
)
|
|
—
|
|
|
(3,958
|
)
|
|
—
|
|
||||
Adjusted EBITDA
|
$
|
14,932
|
|
|
$
|
35,689
|
|
|
$
|
15,954
|
|
|
$
|
87,053
|
|
|
Three Months Ended
June 30, |
|
Increase/
(Decrease)
|
||||||||
|
2016
|
|
2015
|
|
|||||||
Net revenues —
|
|
|
|
|
|
||||||
Well Intervention
|
$
|
59,919
|
|
|
$
|
85,675
|
|
|
$
|
(25,756
|
)
|
Robotics
|
38,914
|
|
|
75,101
|
|
|
(36,187
|
)
|
|||
Production Facilities
|
18,957
|
|
|
20,293
|
|
|
(1,336
|
)
|
|||
Intercompany elimination
|
(10,523
|
)
|
|
(15,053
|
)
|
|
4,530
|
|
|||
|
$
|
107,267
|
|
|
$
|
166,016
|
|
|
$
|
(58,749
|
)
|
|
|
|
|
|
|
||||||
Gross profit (loss) —
|
|
|
|
|
|
||||||
Well Intervention
|
$
|
2,702
|
|
|
$
|
7,254
|
|
|
$
|
(4,552
|
)
|
Robotics
|
(6,613
|
)
|
|
9,420
|
|
|
(16,033
|
)
|
|||
Production Facilities
|
9,823
|
|
|
8,578
|
|
|
1,245
|
|
|||
Corporate and other
|
(417
|
)
|
|
(845
|
)
|
|
428
|
|
|||
Intercompany elimination
|
163
|
|
|
(199
|
)
|
|
362
|
|
|||
|
$
|
5,658
|
|
|
$
|
24,208
|
|
|
$
|
(18,550
|
)
|
|
|
|
|
|
|
||||||
Gross margin —
|
|
|
|
|
|
||||||
Well Intervention
|
5%
|
|
|
8%
|
|
|
|
||||
Robotics
|
(17)%
|
|
|
13%
|
|
|
|
||||
Production Facilities
|
52%
|
|
|
42%
|
|
|
|
||||
Total company
|
5%
|
|
|
15%
|
|
|
|
||||
|
|
|
|
|
|
||||||
Number of vessels or robotics assets
(1)
/ Utilization
(2)
|
|
|
|
|
|
||||||
Well Intervention vessels
|
5/54%
|
|
|
4/63%
|
|
|
|
||||
Robotics assets
|
60/48%
|
|
|
61/61%
|
|
|
|
||||
Chartered robotics vessels
|
4/61%
|
|
|
5/81%
|
|
|
|
(1)
|
Represents number of vessels or robotics assets as of the end of the period excluding acquired vessels prior to their in-service dates, vessels taken out of service prior to their disposition and vessels jointly owned with a third party. The
Helix 534
was excluded from the numbers for the second quarter of 2016 as it was cold stacked and out of service. The
Seawell
was excluded from the numbers for the second quarter of 2015 as it was out of service undergoing major capital upgrades.
|
(2)
|
Represents average utilization rate, which is calculated by dividing the total number of days the vessels or robotics assets generated revenues by the total number of calendar days in the applicable period.
|
|
Six Months Ended
June 30, |
|
Increase/
(Decrease)
|
||||||||
|
2016
|
|
2015
|
|
|||||||
Net revenues —
|
|
|
|
|
|
||||||
Well Intervention
|
$
|
105,975
|
|
|
$
|
189,726
|
|
|
$
|
(83,751
|
)
|
Robotics
|
70,908
|
|
|
155,272
|
|
|
(84,364
|
)
|
|||
Production Facilities
|
37,439
|
|
|
38,678
|
|
|
(1,239
|
)
|
|||
Intercompany elimination
|
(16,016
|
)
|
|
(28,019
|
)
|
|
12,003
|
|
|||
|
$
|
198,306
|
|
|
$
|
355,657
|
|
|
$
|
(157,351
|
)
|
|
|
|
|
|
|
||||||
Gross profit (loss) —
|
|
|
|
|
|
||||||
Well Intervention
|
$
|
(10,979
|
)
|
|
$
|
25,802
|
|
|
$
|
(36,781
|
)
|
Robotics
|
(16,961
|
)
|
|
22,110
|
|
|
(39,071
|
)
|
|||
Production Facilities
|
17,221
|
|
|
13,347
|
|
|
3,874
|
|
|||
Corporate and other
|
(884
|
)
|
|
(2,011
|
)
|
|
1,127
|
|
|||
Intercompany elimination
|
331
|
|
|
(93
|
)
|
|
424
|
|
|||
|
$
|
(11,272
|
)
|
|
$
|
59,155
|
|
|
$
|
(70,427
|
)
|
|
|
|
|
|
|
||||||
Gross margin —
|
|
|
|
|
|
||||||
Well Intervention
|
(10)%
|
|
|
14%
|
|
|
|
||||
Robotics
|
(24)%
|
|
|
14%
|
|
|
|
||||
Production Facilities
|
46%
|
|
|
35%
|
|
|
|
||||
Total company
|
(6)%
|
|
|
17%
|
|
|
|
||||
|
|
|
|
|
|
||||||
Number of vessels or robotics assets
(1)
/ Utilization
(2)
|
|
|
|
|
|
||||||
Well Intervention vessels
|
5/38%
|
|
|
4/65%
|
|
|
|
||||
Robotics assets
|
60/44%
|
|
|
61/61%
|
|
|
|
||||
Chartered robotics vessels
|
4/57%
|
|
|
5/83%
|
|
|
|
(1)
|
Represents number of vessels or robotics assets as of the end of the period excluding acquired vessels prior to their in-service dates, vessels taken out of service prior to their disposition and vessels jointly owned with a third party. The
Helix 534
was excluded from the numbers for the first half of 2016 as it was cold stacked and out of service. The
Seawell
was excluded from the numbers for the first half of 2015 as it was out of service undergoing major capital upgrades.
|
(2)
|
Represents average utilization rate, which is calculated by dividing the total number of days the vessels or robotics assets generated revenues by the total number of calendar days in the applicable period.
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
|
|
|
||||
Net working capital
|
$
|
454,473
|
|
|
$
|
473,123
|
|
Long-term debt
(1)
|
$
|
638,985
|
|
|
$
|
677,695
|
|
Liquidity
(2)
|
$
|
542,977
|
|
|
$
|
743,577
|
|
(1)
|
Long-term debt does not include the current maturities portion of our long-term debt as that amount is included in net working capital. It is also net of unamortized debt discount and debt issuance costs. See Note 6 for information relating to our existing debt.
|
(2)
|
Liquidity, as defined by us, is equal to cash and cash equivalents plus available capacity under our Revolving Credit Facility, which capacity is reduced by letters of credit drawn against the facility. Our liquidity at
June 30, 2016
included cash and cash equivalents of
$492.2 million
(including
$150 million
of minimum cash balance) and
$50.8 million
of available borrowing capacity under our Revolving Credit Facility (Note 6). Our liquidity at
December 31, 2015
included cash and cash equivalents of
$494.2 million
and
$249.4 million
of available borrowing capacity under our Revolving Credit Facility.
|
|
June 30,
2016 |
|
December 31,
2015 |
||||
|
|
|
|
||||
Term Loan (matures June 2018)
|
$
|
238,145
|
|
|
$
|
253,181
|
|
Nordea Q5000 Loan (matures April 2020)
|
211,336
|
|
|
228,840
|
|
||
MARAD Debt (matures February 2027)
|
80,976
|
|
|
83,659
|
|
||
2032 Notes (mature March 2032)
(1)
|
180,314
|
|
|
183,655
|
|
||
Total debt
|
$
|
710,771
|
|
|
$
|
749,335
|
|
(1)
|
The 2032 Notes will increase to their face amount through accretion of non-cash interest charges through March 15, 2018, which is the first date on which the holders of the notes may require us to repurchase the notes.
|
|
Six Months Ended
June 30, |
||||||
|
2016
|
|
2015
|
||||
Cash provided by (used in):
|
|
|
|
||||
Operating activities
|
$
|
24,889
|
|
|
$
|
3,033
|
|
Investing activities
|
$
|
(20,476
|
)
|
|
$
|
(221,530
|
)
|
Financing activities
|
$
|
(4,309
|
)
|
|
$
|
239,721
|
|
|
Six Months Ended
June 30, |
||||||
|
2016
|
|
2015
|
||||
Capital expenditures:
|
|
|
|
||||
Well Intervention
|
$
|
(57,281
|
)
|
|
$
|
(222,968
|
)
|
Robotics
|
(413
|
)
|
|
(8,981
|
)
|
||
Production Facilities
|
(74
|
)
|
|
(823
|
)
|
||
Other
|
205
|
|
|
(100
|
)
|
||
Distributions from equity investments, net
(1)
|
1,200
|
|
|
3,842
|
|
||
Proceeds from sale of equity investment
(2)
|
25,000
|
|
|
—
|
|
||
Proceeds from sale of assets
(3)
|
10,887
|
|
|
7,500
|
|
||
Net cash used in investing activities
|
$
|
(20,476
|
)
|
|
$
|
(221,530
|
)
|
(1)
|
Distributions from equity investments are net of undistributed equity earnings from our equity investments. Gross distributions from our equity investments for the
six
-month periods ended
June 30, 2016
and
2015
were
$1.2 million
and
$3.5 million
, respectively (Note 5).
|
(2)
|
Amount in 2016 reflects cash received from the sale of our former ownership interest in Deepwater Gateway.
|
(3)
|
Amount in 2015 reflects cash received from the sale of our former Ingleside spoolbase.
|
|
Total
(1)
|
|
Less Than
1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More Than
5 Years
|
||||||||||
|
|
|
|
|
|
|
|
|
|
||||||||||
Term Loan
|
$
|
240,000
|
|
|
$
|
30,000
|
|
|
$
|
210,000
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Nordea Q5000 Loan
|
214,285
|
|
|
35,714
|
|
|
71,429
|
|
|
107,142
|
|
|
—
|
|
|||||
MARAD debt
|
86,221
|
|
|
6,072
|
|
|
13,068
|
|
|
14,405
|
|
|
52,676
|
|
|||||
2032 Notes
(2)
|
192,750
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
192,750
|
|
|||||
Interest related to debt
(3)
|
170,820
|
|
|
31,255
|
|
|
43,333
|
|
|
21,403
|
|
|
74,829
|
|
|||||
Property and equipment
(4)
|
347,213
|
|
|
129,317
|
|
|
217,896
|
|
|
—
|
|
|
—
|
|
|||||
Operating leases
(5)
|
908,590
|
|
|
150,220
|
|
|
300,774
|
|
|
236,007
|
|
|
221,589
|
|
|||||
Total cash obligations
|
$
|
2,159,879
|
|
|
$
|
382,578
|
|
|
$
|
856,500
|
|
|
$
|
378,957
|
|
|
$
|
541,844
|
|
(1)
|
Excludes unsecured letters of credit outstanding at
June 30, 2016
totaling
$6.0 million
. These letters of credit support various obligations, such as contractual obligations, customs duties, contract bidding and insurance activities.
|
(2)
|
Notes mature in 2032. The 2032 Notes can be converted prior to their stated maturity if the closing price of our common stock for at least 20 days in the period of 30 consecutive trading days ending on the last trading day of the preceding fiscal quarter exceeds 130% of their issuance price on that 30th trading day (i.e., $32.53 per share). At
June 30, 2016
, the conversion trigger was not met. The first date that the holders of these notes may require us to repurchase the notes is March 15, 2018. See Note 6 for additional information.
|
(3)
|
Interest payment obligations were calculated using stated coupon rates for fixed rate debt and interest rates applicable at
June 30, 2016
for variable rate debt.
|
(4)
|
Primarily reflects the costs associated with our
Q7000
semi-submersible vessel currently under construction and the topside equipment for the
Siem Helix 1
and
Siem Helix 2
chartered vessels (Note 12).
|
(5)
|
Operating leases include vessel charters and facility leases. At
June 30, 2016
, our vessel charter commitments totaled approximately $859.7 million, including the
Grand Canyon III
that we expect to place in service in May 2017, the
Siem Helix 1
, which is expected to be in service for Petrobras in the fourth quarter of 2016, and the yet to be delivered
Siem Helix 2
. The
Rem Installer
’s charter expired in July 2016.
|
Period
|
|
(a)
Total number
of shares
purchased
|
|
(b)
Average
price paid
per share
|
|
(c)
Total number
of shares
purchased as
part of publicly
announced
program
|
|
(d)
Maximum
number of shares
that may yet be
purchased under
the program
(1)
|
|||||
April 1 to April 30, 2016
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
2,199,748
|
|
May 1 to May 31, 2016
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,199,748
|
|
|
June 1 to June 30, 2016
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,199,748
|
|
|
|
|
—
|
|
|
$
|
—
|
|
|
—
|
|
|
|
(1)
|
Under the terms of our stock repurchase program, the issuance of shares to members of our Board and to certain employees, including shares issued to our employees under the ESPP (Note 10), increases the amount of shares available for repurchase. For additional information regarding our stock repurchase program, see Note 10 to our
2015
Form 10-K.
|
|
|
|
|
HELIX ENERGY SOLUTIONS GROUP, INC.
(Registrant)
|
Date:
|
July 22, 2016
|
|
By:
|
/s/ Owen Kratz
|
|
|
|
|
Owen Kratz
President and Chief Executive Officer
(Principal Executive Officer)
|
|
|
|
|
|
Date:
|
July 22, 2016
|
|
By:
|
/s/ Anthony Tripodo
|
|
|
|
|
Anthony Tripodo
Executive Vice President and
Chief Financial Officer
(Principal Financial Officer)
|
Exhibits
|
|
Description
|
|
Filed or Furnished Herewith or Incorporated by Reference from the Following Documents (Registration or File Number)
|
3.1
|
|
2005 Amended and Restated Articles of Incorporation, as amended, of Helix.
|
|
Exhibit 3.1 to the Current Report on Form 8-K filed on March 1, 2006 (000-22739)
|
3.2
|
|
Second Amended and Restated By-Laws of Helix, as amended.
|
|
Exhibit 3.1 to the Current Report on Form 8-K filed on September 28, 2006 (001-32936)
|
10.1
|
|
Equity Distribution Agreement dated April 25, 2016 between Helix Energy Solutions Group, Inc. and Wells Fargo Securities LLC.
|
|
Exhibit 1.1 to the Current Report on Form 8-K filed on April 25, 2016 (001-32936)
|
31.1
|
|
Certification Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 by Owen Kratz, Chief Executive Officer.
|
|
Filed herewith
|
31.2
|
|
Certification Pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934 by Anthony Tripodo, Chief Financial Officer.
|
|
Filed herewith
|
32.1
|
|
Certification of Helix’s Chief Executive Officer and Chief Financial Officer pursuant to Section 906 of the Sarbanes — Oxley Act of 2002.
|
|
Furnished herewith
|
101.INS
|
|
XBRL Instance Document.
|
|
Furnished herewith
|
101.SCH
|
|
XBRL Schema Document.
|
|
Furnished herewith
|
101.CAL
|
|
XBRL Calculation Linkbase Document.
|
|
Furnished herewith
|
101.PRE
|
|
XBRL Presentation Linkbase Document.
|
|
Furnished herewith
|
101.DEF
|
|
XBRL Definition Linkbase Document.
|
|
Furnished herewith
|
101.LAB
|
|
XBRL Label Linkbase Document.
|
|
Furnished herewith
|
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