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SEC Filings

8-K
KEY ENERGY SERVICES INC filed this Form 8-K on 10/28/2011
Entire Document
 
Exhibit 99.1
Exhibit 99.1
     
For Immediate Release:
Thursday, October 27, 2011
  Contact: Gary Russell
713-651-4434
Key Energy Services Generated Third Quarter 2011 Earnings of $0.31 Per Diluted Share,
Excluding Edge Transaction Costs
GAAP income was $0.30 per diluted share
HOUSTON, TX, October 27, 2011 — Key Energy Services, Inc. (NYSE: KEG) generated third quarter 2011 income of $46.3 million, or $0.31 per share, excluding pre-tax transaction costs of $3.3 million, or $0.01 per share, related to the acquisition of Edge Oilfield Services. This result compares to second quarter 2011 income of $33.0 million, or $0.23 per share, excluding a pre-tax gain of $4.8 million, or $0.02 per share, related to the sale of the Company’s equity interest in IROC Energy Services Corp. Third quarter 2011 GAAP income was $44.2 million, or $0.30 per share.
Consolidated revenue for the quarter was $501.3 million, up 12.6% compared to second quarter 2011 revenue of $445.4 million. Edge contributed $20.7 million of revenue for two months of the third quarter, and Edge revenue is reflected within Key’s Fishing & Rental Services business.
The following table sets forth summary data from continuing operations for the quarter ended September 30, 2011 and prior comparable quarterly periods:
                         
    Three Months Ended (unaudited)  
    September 30,     June 30,     September 30,  
    2011     2011     2010  
    (in millions, except per share amounts)  
 
                       
Revenues
  $ 501.3     $ 445.4     $ 283.7  
Income (loss) attributable to Key
  $ 44.2     $ 36.1     $ (1.5 )
Diluted income (loss) per share attributable to Key
  $ 0.30     $ 0.25     $ (0.01 )
Adjusted EBITDA (defined below)
  $ 122.5     $ 102.1     $ 39.9  
U.S. Segment
Third quarter 2011 U.S. revenue was $411.8 million, up 12.1% compared to the second quarter 2011. Operating income was $106.2 million, or 25.8% of revenue, reflecting sequential incremental operating income margins of 45%. Rig Services revenue increased 8% sequentially from favorable work mix and pricing. Intervention Services and Fishing & Rental Services revenue also increased due to improved pricing and activity.
International Segment
International revenue was $89.5 million during the quarter, up 14.9% from the second quarter 2011. Operating income was $11.8 million, or 13.1% of revenue, up 490 basis points compared to the second quarter 2011, generating sequential incremental operating income margins of 46%. Revenue improvement was driven by activity increases in all international markets.
General and Administrative Expenses
Total general and administrative expenses were $62.9 million, or 12.6% of revenue, in the third quarter 2011 compared to $55.0 million, or 12.3% of revenue, in the second quarter. Third quarter general and administrative expense includes $3.3 million of Edge transaction costs.