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| Share Name | Share Symbol | Market | Type |
|---|---|---|---|
| McDermott International Inc | NYSE:MDR | NYSE | Common Stock |
| Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 0.7032 | 0 | 01:00:00 |
From Jul 2019 to Jul 2024
McDermott International, Inc. (NYSE: MDR) (“McDermott” or the “Company”) today reported net income of $20.6 million, or $0.09 per fully diluted share, for the quarter ended March 31, 2013. The results for the first quarter 2013 compared to income from continuing operations of $61.9 million, or $0.25 per fully diluted share, in the corresponding period of 2012. Weighted average common shares outstanding on a fully diluted basis were approximately 239.2 million and 237.3 million in the quarters ended March 31, 2013 and 2012, respectively.
McDermott’s revenues were $807.5 million for the first quarter 2013, an increase of 11 percent compared to $727.7 million in the corresponding period of 2012. The year-over-year increase was primarily due to an approximately $48.6 million increase in revenues in the Atlantic segment as a result of increased fabrication activity, coupled with increased revenues in the Asia Pacific and Middle East segments.
The Company’s operating income in the first quarter 2013 was $53.0 million, a decrease of $27.2 million compared to $80.2 million in the first quarter 2012. The first quarter 2013 results were affected by operating losses in the Middle East and Atlantic segments, partially offset by stronger operating income in our Asia Pacific segment. In the first quarter 2013, operating losses in the Middle East segment totaled approximately $18.5 million compared to operating income of $34.7 million for the corresponding prior year period, a decline primarily attributable to execution plan changes on a project at an advanced stage of completion, which resulted in cost increases associated with hook-up activities and the use of third-party vessels. In addition, the decline in operating income was due to lower asset utilization and project activity compared to the prior year. The operating loss for the Atlantic segment changed by approximately $4.4 million to a loss of approximately $16.4 million due to increased support costs associated with lower marine asset utilization.
Operating income in the Asia Pacific segment increased approximately $30.5 million to $88.0 million in the first quarter 2013, primarily due to the successful execution and change orders on a key project as well as cost savings on other projects offset by approximately $4.1 million in increased costs estimates for one of our marine subsea projects. In addition, an approximately $12.3 million or $0.05 per diluted share gain on the sale of the DB 26 was recognized during the quarter for the segment.
The Company’s other expense for the first quarter 2013 was $1.4 million, a reduction of $11.9 million compared to other income of $10.5 million in the first quarter 2012, primarily due to net losses on foreign currency related items.
During the quarter, the Company booked approximately $1.0 billion in new orders including two projects in the Arabian Gulf. In addition, at March 31, 2013 the Company had approximately $5.6 billion in bids and change orders outstanding. The Company has also identified $10.1 billion in target project opportunities that the Company expects to bid in the next five quarters.
At March 31, 2013, the Company’s backlog was $5.3 billion, compared to $5.8 billion and $5.1 billion at March 31, 2012 and December 31, 2012, respectively. Of the March 31, 2013 backlog, approximately $428.9 million was derived from five projects currently in a loss position, of which 93 percent relate to a project in the Asia Pacific segment and the five-year charter in Brazil. In addition, the backlog includes approximately $165.6 million for one project under deferred profit recognition.
“Although the final phases of an otherwise well-executed project in the Middle East challenged us this quarter, I am pleased with our successful completion of a key project in the Asia Pacific segment,” said Stephen M. Johnson, Chairman of the Board, President and Chief Executive Officer of McDermott. “With the sale of the DB 26 and our expansion of our subsea engineering talent through the acquisition of DeepSea group, McDermott is making steady progress on its strategic transformation. We remain focused on winning work for which we can provide a cost-effective solution and execute successfully for our customers and for our shareholders.”
Balance Sheet Summary
As of March 31, 2013, McDermott reported total assets of approximately $3.2 billion. Included in this amount was $502.4 million of cash and cash equivalents, restricted cash and investments. Net working capital, calculated as current assets less current liabilities, was $616.2 million. Additionally, total equity was $2.0 billion, or approximately 62% of total assets, with total debt of $101.2 million.
OTHER INFORMATION
Conference Call
McDermott has scheduled a conference call and webcast related to its first quarter 2013 results on Thursday, May 9, 2013, at 9:00 a.m. U.S. Central Daylight Time. Interested parties may listen over the Internet through a link posted in the Investor Relations section of the Company's website. The replay will also be available on the Company's website following the end of the live call.
About the Company
McDermott is a leading engineering, procurement, construction and installation (“EPCI”) company focused on executing complex offshore oil and gas projects worldwide. Providing fully integrated EPCI services for upstream field developments, the Company delivers fixed and floating production facilities, pipelines and subsea systems from concept to commissioning. McDermott’s customers include national, major integrated and other energy companies. Operating in approximately 20 countries across the Atlantic, Middle East and Asia Pacific, the Company’s integrated resources include approximately 14,000 employees and a diversified fleet of marine vessels, fabrication facilities and engineering offices. McDermott has served the energy industry since 1923. To learn more, please visit McDermott’s website on the Internet at www.mcdermott.com.
Forward-Looking Statements
In accordance with the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995, McDermott cautions that statements in this press release, which are forward-looking and provide other than historical information, involve risks and uncertainties that may impact McDermott's actual results of operations. These forward-looking statements include statements about backlog, bookings, bidding, change orders outstanding and target project opportunities, to the extent each of these items may be viewed as an indicator of future revenues, McDermott’s expectations on the timing for bidding target project opportunities and McDermott’s progress on its strategic transformation. Although we believe that the expectations reflected in those forward-looking statements are reasonable, we can give no assurance that those expectations will prove to have been correct. Those statements are made by using various underlying assumptions and are subject to numerous uncertainties and risks, including adverse changes in the markets in which we operate or credit markets, our inability to successfully execute on contracts in backlog, changes in project design or schedules, changes in the scope or timing of contracts, and contract cancellations, change orders and other modifications. If one or more of these risks materialize, or if underlying assumptions prove incorrect, actual results may vary materially from those expected. For a more complete discussion of these and other risk factors, please see McDermott's annual and quarterly filings with the Securities and Exchange Commission, including its annual report on Form 10-K for the year ended December 31, 2012 and subsequent quarterly reports on Form 10-Q. This news release reflects management's views as of the date hereof. Except to the extent required by applicable law, McDermott undertakes no obligation to update or revise any forward-looking statement.
McDERMOTT INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF INCOME
Three Months EndedMarch 31, 2013 2012 (In thousands) Revenues $ 807,488 $ 727,678 Costs and Expenses: Cost of operations 712,814 597,434 Selling, general and administrative expenses 52,226 46,611 Gain on asset disposals (14,716 ) (226 ) Total costs and expenses 750,324 643,819 Equity in Loss of Unconsolidated Affiliates (4,131 ) (3,683 ) Operating Income 53,033 80,176 Other Income (Expense): Interest income 342 1,634 Gain (loss) on foreign currency – net (2,526 ) 9,441 Other income (expense) – net 782 (581 ) Total other income (expense) (1,402 ) 10,494 Income from continuing operations before provision for income taxes and noncontrolling interests 51,631 90,670 Provision for Income Taxes 27,313 28,743 Income from continuing operations before noncontrolling interests 24,318 61,927 Gain on disposal of discontinued operations-
257 Income from discontinued operations, net of tax-
3,240 Total income from discontinued operations, net of tax-
3,497 Net Income 24,318 65,424 Less: Net Income Attributable to Noncontrolling Interests 3,765 2,666 Net Income Attributable to McDermott International, Inc. $ 20,553 $ 62,758
McDERMOTT INTERNATIONAL, INC.
EARNINGS PER SHARE COMPUTATION
Three Months EndedMarch 31, 2013 2012(In thousands, except share and per share amounts)
Income from continuing operations less noncontrolling interests $ 20,553 $ 59,261 Income from discontinued operations, net of tax-
3,497 Net income attributable to McDermott International, Inc. $ 20,553 $ 62,758 Weighted average common shares (basic) 235,941,185 235,208,252 Effect of dilutive securities: Stock options, restricted stock and restricted stock units 3,258,696 2,124,375 Adjusted weighted average common shares and assumed exercises of stock options and vesting of stock awards (diluted) 239,199,881 237,332,627 Basic earnings per share: Income from continuing operations less noncontrolling interests 0.09 0.25 Income from discontinued operations, net of tax-
0.01 Net income attributable to McDermott International, Inc. 0.09 0.27 Diluted earnings per share: Income from continuing operations less noncontrolling interests 0.09 0.25 Income from discontinued operations, net of tax-
0.01 Net income attributable to McDermott International, Inc. 0.09 0.26SUPPLEMENTARY DATA
Three Months EndedMarch 31, 2013 2012 (In thousands) Depreciation & amortization expense $ 20,222 $ 23,276 Drydock amortization expense $ 5,550 $ 7,112 Capital expenditures $ 37,649 $ 44,751 Backlog $ 5,297,981 $ 5,806,633
McDERMOTT INTERNATIONAL, INC.
CONSOLIDATED BALANCE SHEETS
March 31, 2013December 31, 2012
(In thousands, except share and per share amounts)
Assets Current Assets: Cash and cash equivalents $ 461,535 $ 640,147 Restricted cash and cash equivalents 21,942 18,116Accounts receivable--trade, net
443,182 428,800Accounts receivable--other
65,561 75,461 Contracts in progress 544,404 560,154 Deferred income taxes 6,888 9,765 Assets held for sale 1,396 2,679 Other current assets 42,436 54,667 Total Current Assets 1,587,344 1,789,789 Property, Plant and Equipment 2,155,243 2,115,176 Less accumulated depreciation (828,223 ) (833,385 ) Net Property, Plant and Equipment 1,327,020 1,281,791 Investments 18,936 26,750 Goodwill 41,202 41,202 Investments in Unconsolidated Affiliates 35,233 37,435 Assets Held for Sale 12,243 26,758 Other Assets 159,040 129,902 Total Assets $ 3,181,018 $ 3,333,627 Liabilities and Equity Current Liabilities: Notes payable and current maturities of long-term debt $ 44,025 $ 14,146 Accounts payable 302,250 400,007 Accrued liabilities 332,358 369,418 Advance billings on contracts 206,010 241,696 Deferred income taxes 16,027 10,758 Income taxes payable 70,425 76,986 Total Current Liabilities 971,095 1,113,011 Long-Term Debt 57,188 88,562 Self-Insurance 24,141 22,641 Pension Liability 24,757 25,069 Other Liabilities 136,949 132,239 Commitments and Contingencies Stockholders’ Equity: Common stock, par value $1.00 per share, authorized 400,000,000 shares; issued 243,778,369 and 243,442,156 shares at March 31, 2013 and December 31, 2012, respectively243,778
243,442
Capital in excess of par value 1,394,859 1,391,271 Retained earnings 466,309 445,756 Treasury stock, at cost, 7,359,501 and 7,574,903 shares at March 31, 2013 and December 31, 2012, respectively (99,688 ) (98,725)
Accumulated other comprehensive loss(100,697
)
(94,413
)
Stockholders’ Equity--McDermott International, Inc.
1,904,561 1,887,331 Noncontrolling Interests 62,327 64,774 Total Equity 1,966,888 1,952,105 Total Liabilities and Equity $ 3,181,018 $ 3,333,627
McDERMOTT INTERNATIONAL, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months EndedMarch 31,
2013 2012 (In thousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 24,318 $ 65,424 Less: Income from discontinued operations, net of tax-
3,497 Income from continuing operations 24,318 61,927 Non-cash items included in net income: Depreciation and amortization 20,222 23,276 Drydock amortization 5,550 7,112 Equity in loss of unconsolidated affiliates 4,131 3,683 Gain on asset disposals (14,716 ) (226 ) Benefit for deferred taxes 5,332 (4,131 ) Other non-cash items 2,391 3,803 Changes in assets and liabilities, net of effects from acquisitions and dispositions: Accounts receivable (6,573 ) 50,017 Net contracts in progress and advance billings on contracts (19,935 ) 65,363 Accounts payable (125,234 ) (55,292 ) Accrued and other current liabilities (20,774 ) (10,040 ) Pension liability and accrued postretirement and employee benefits (19,657 ) 7,489 Other assets and liabilities (42,170 ) 19,880TOTAL CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES--CONTINUING OPERATIONS
(187,115 ) 172,861 CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property, plant and equipment (37,649 ) (44,751 ) Increase in restricted cash and cash equivalents (3,826 ) (2,870 ) Purchases of available-for-sale securities (3,744 ) (40,319 ) Sales and maturities of available-for-sale securities 31,193 94,380 Proceeds from sale and disposal of assets 35,621 226 Other investing activities (4,596 ) (2,376 )NET CASH PROVIDED BY INVESTING ACTIVITIES--CONTINUING OPERATIONS
16,999 4,290NET CASH PROVIDED BY INVESTING ACTIVITIES--DISCONTINUED OPERATIONS
-
60,671 TOTAL CASH PROVIDED BY INVESTING ACTIVITIES 16,999 64,961 CASH FLOWS FROM FINANCING ACTIVITIES: Payment of debt (1,494 ) (1,494 ) Distributions to noncontrolling interests (6,200 ) (15,733 ) Other financing activities (1,015 ) (1,784 )TOTAL CASH USED IN FINANCING ACTIVITIES--CONTINUING OPERATIONS
(8,709 ) (19,011 ) EFFECTS OF EXCHANGE RATE CHANGES ON CASH 213 (700 ) NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (178,612 ) 218,111 CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 640,147 570,854CASH AND CASH EQUIVALENTS AT END OF PERIOD--CONTINUING OPERATIONS
$ 461,535 $ 788,965 SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the period for: Income taxes (net of refunds) $ 25,916 $ 16,036
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