Press Releases
Helix reported a net loss of
Fourth quarter 2015 results were impacted by
-
Impairment charges of
$256.2 million associated with our Production Facilities assets -
Impairment charge of
$205.2 million associated with the Helix 534 -
Impairment charge of
$6.3 million associated with other Well Intervention assets -
Goodwill impairment charge of
$16.4 million associated with Well Intervention business in theU.K. -
Unrealized losses of
$19.0 million associated with ineffectiveness of our foreign currency derivative contracts
The above items resulted in an after-tax impact of
1EBITDA is a non-GAAP measure. See reconciliation below.
* * * * *
Summary of Results |
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($ in thousands, except per share amounts, unaudited) |
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Three Months Ended | Twelve Months Ended | ||||||||||||||||||||||
12/31/2015 | 12/31/2014 | 9/30/2015 | 12/31/2015 | 12/31/2014 | |||||||||||||||||||
Revenues | $ | 157,683 | $ | 207,160 | $ | 182,462 | $ | 695,802 | $ | 1,107,156 | |||||||||||||
Gross Profit (Loss): | |||||||||||||||||||||||
Operating | $ | 20,112 | $ | 32,805 | $ | 31,969 | $ | 111,236 | $ | 344,036 | |||||||||||||
13 | % | 16 | % | 18 | % | 16 | % | 31 | % | ||||||||||||||
Asset Impairments | (345,010 | ) | - | - | (345,010 | ) | - | ||||||||||||||||
Total | $ | (324,898 | ) | $ | 32,805 | $ | 31,969 | $ | (233,774 | ) | $ | 344,036 | |||||||||||
Goodwill Impairment | $ | (16,399 | ) | $ | - | $ | - | $ | (16,399 | ) | $ | - | |||||||||||
Non-cash Losses on Equity Investments | $ | (122,765 | ) | $ | - | $ | - | $ | (122,765 | ) | $ | - | |||||||||||
Net Income (Loss) Applicable to
Common Shareholders |
$ | (403,867 | ) | $ | 7,960 | $ | 9,880 | $ | (376,980 | ) | $ | 195,047 | |||||||||||
Diluted Earnings (Loss) Per Share | $ | (3.83 | ) | $ | 0.08 | $ | 0.09 | $ | (3.58 | ) | $ | 1.85 | |||||||||||
Adjusted EBITDA1 | $ | 34,186 | $ | 39,362 | $ | 51,497 | $ | 172,736 | $ | 378,010 | |||||||||||||
1EBITDA is a non-GAAP measure. See reconciliation below. | |||||||||||||||||||||||
Segment Information, Operational and Financial Highlights |
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($ in thousands, unaudited) | ||||||||||||||
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Three Months Ended | ||||||||||||||
12/31/2015 | 12/31/2014 | 9/30/2015 | ||||||||||||
Revenues: | ||||||||||||||
Well Intervention | $ | 88,680 | $ | 121,792 | $ | 94,895 | ||||||||
Robotics | 62,444 | 80,923 | 83,310 | |||||||||||
Production Facilities | 18,137 | 21,802 | 19,133 | |||||||||||
Intercompany Eliminations | (11,578 | ) | (17,357 | ) | (14,876 | ) | ||||||||
Total | $ | 157,683 | $ | 207,160 | $ | 182,462 | ||||||||
Income from Operations: | ||||||||||||||
Well Intervention | $ | 8,433 | $ | 10,513 | $ | 6,233 | ||||||||
Robotics | (257 | ) | 7,914 | 14,329 | ||||||||||
Production Facilities | 6,626 | 8,011 | 6,938 | |||||||||||
Non-cash Impairment Charges | (361,409 | ) | - | - | ||||||||||
Corporate / Other | (9,285 | ) | (16,846 | ) | (8,965 | ) | ||||||||
Intercompany Eliminations | 158 | 129 | (163 | ) | ||||||||||
Total | $ | (355,734 | ) | $ | 9,721 | $ | 18,372 | |||||||
Business Segment Results
-
Well Intervention revenues decreased 7% in the fourth quarter of 2015
as compared to revenues in the third quarter of 2015. Well
Intervention vessel utilization in the fourth quarter of 2015
decreased to 47% from 60% in the third quarter of 2015. The Q4000
utilization was 98% in the fourth quarter of 2015 compared to 67% in
third quarter of 2015. The Q5000 was utilized 78% in the fourth
quarter of 2015 after entering service late October. The Helix 534
remained idle the entire quarter. In the
North Sea , the Well Enhancer utilization decreased to 67% in the fourth quarter from 91% in the third quarter. The Skandi Constructor utilization decreased to 45% in the fourth quarter from 100% in the third quarter. The vessel has been warm stacked since mid-November. The Seawell was idle the entire quarter and remains warm stacked. The rental intervention riser systems continue to positively contribute to revenues, with both units on hire the entire fourth quarter of 2015. -
Robotics revenues decreased 25% in the fourth quarter of 2015 compared
to the third quarter of 2015. Vessel utilization decreased to 58% in
the fourth quarter of 2015 from 87% in the third quarter of 2015 and
ROV asset utilization decreased to 48% in the fourth quarter of 2015
from 59% in the third quarter of 2015. The decrease in revenue and
gross profit was due to lower asset utilization, primarily driven by
the seasonal slow-down in the
North Sea .
Other Expenses
-
Selling, general and administrative expenses were
$14.5 million , 9.2% of revenue, in the fourth quarter of 2015 compared to$13.6 million , 7.5% of revenue, in the third quarter of 2015. -
Net interest expense increased slightly to
$8.9 million in the fourth quarter of 2015 from$8.7 million in the third quarter of 2015. -
Our fourth quarter 2015 other expense increased
$18.1 million primarily as a result of unrealized losses associated with ineffectiveness of our foreign currency derivative contracts.
Financial Condition and Liquidity
-
Our total liquidity at
December 31, 2015 was approximately$744 million , consisting of$494 million in cash and cash equivalents and$250 million in available capacity under our revolver. Consolidated net debt atDecember 31, 2015 was$267 million . Consolidated gross funded debt decreased to$776 million in the fourth quarter of 2015, compared to$793 million in the third quarter of 2015. Net debt to book capitalization atDecember 31, 2015 was 17%. (Net debt to book capitalization is a non-GAAP measure. See reconciliation below.) -
We incurred capital expenditures (including capitalized interest)
totaling
$42 million in the fourth quarter of 2015 compared to$55 million in the third quarter of 2015 and$126 million in the fourth quarter of 2014.
* * * * *
Conference Call Information
Further details are provided in the presentation for Helix’s quarterly
conference call to review its fourth quarter 2015 results (see the
“Investor Relations” page of Helix’s website, www.HelixESG.com).
The call, scheduled for
About Helix
Reconciliation of Non-GAAP Financial Measures
Management evaluates Company performance and financial condition using certain non-GAAP metrics, primarily EBITDA, Adjusted EBITDA, net debt and net debt to book capitalization. We define EBITDA as earnings before income taxes, net interest expense, net other income or expense, and depreciation and amortization expense. We separately disclose our non-cash asset impairment charges, which, if not material, would be reflected as a component of our depreciation and amortization expense. Because these impairment charges are material to our 2015 results of operations, we have reported them as a separate line item in the accompanying condensed consolidated statements of operations. Non-cash goodwill impairment and non-cash losses on equity investments are also added back if applicable. To arrive at our measure of Adjusted EBITDA, we exclude the noncontrolling interests related to the adjustment components of EBITDA and the gain or loss on disposition of assets. In addition, we include realized losses from the cash settlements of our ineffective foreign currency derivative contracts, which are excluded from EBITDA as a component of net other income or expense. Net debt is calculated as total long-term debt less cash and cash equivalents. Net debt to book capitalization is calculated by dividing net debt by the sum of net debt and shareholders’ equity. These non-GAAP measures are useful to investors and other internal and external users of our financial statements in evaluating our operating performance because they are widely used by investors in our industry to measure a company’s operating performance without regard to items that can vary substantially from company to company, and help investors meaningfully compare our results from period to period. EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for, but instead are supplemental to, income from operations, net income or other income data prepared in accordance with GAAP. Non-GAAP financial measures should be viewed in addition to, and not as an alternative to, our reported results prepared in accordance with GAAP. Users of this financial information should consider the types of events and transactions that are excluded from these measures.
Forward-Looking Statements
This press release contains forward-looking statements that involve
risks, uncertainties and assumptions that could cause our results to
differ materially from those expressed or implied by such
forward-looking statements. All statements, other than statements of
historical fact, are "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995, including, without
limitation, any statements regarding our strategy; any statements
regarding future utilization; any projections of financial items; future
operations expenditures; any statements regarding the plans, strategies
and objectives of management for future operations; any statement
concerning developments; any statements regarding future economic
conditions or performance; any statements of expectation or belief; and
any statements of assumptions underlying any of the foregoing. The
forward-looking statements are subject to a number of known and unknown
risks, uncertainties and other factors including but not limited to the
performance of contracts by suppliers, customers and partners; actions
by governmental and regulatory authorities; operating hazards and
delays; our ultimate ability to realize current backlog; employee
management issues; complexities of global political and economic
developments; geologic risks; volatility of oil and gas prices and other
risks described from time to time in our reports filed with the
Social Media
From time to time we provide information about Helix on Twitter (@Helix_ESG)
and
HELIX ENERGY SOLUTIONS GROUP, INC. | |||||||||||||||||||
Comparative Condensed Consolidated Statements of Operations | |||||||||||||||||||
Three Months Ended Dec. 31, | Twelve Months Ended Dec. 31, | ||||||||||||||||||
(in thousands, except per share data) | 2015 | 2014 | 2015 | 2014 | |||||||||||||||
(unaudited) | (unaudited) | ||||||||||||||||||
Net revenues | $ | 157,683 | $ | 207,160 | $ | 695,802 | $ | 1,107,156 | |||||||||||
Cost of sales | 137,571 | 174,355 | 584,566 | 763,120 | |||||||||||||||
Asset impairments | 345,010 | - | 345,010 | - | |||||||||||||||
Gross profit (loss) | (324,898 | ) | 32,805 | (233,774 | ) | 344,036 | |||||||||||||
Goodwill impairment | (16,399 | ) | - | (16,399 | ) | - | |||||||||||||
Gain (loss) on disposition of assets, net | 92 | (178 | ) | 92 | 10,240 | ||||||||||||||
Selling, general and administrative expenses | (14,529 | ) | (22,906 | ) | (57,279 | ) | (92,520 | ) | |||||||||||
Income (loss) from operations | (355,734 | ) | 9,721 | (307,360 | ) | 261,756 | |||||||||||||
Equity in earnings (losses) of investments | (123,792 | ) | 170 | (124,345 | ) | 879 | |||||||||||||
Net interest expense | (8,896 | ) | (5,003 | ) | (26,914 | ) | (17,859 | ) | |||||||||||
Other income (expense), net | (18,113 | ) | 1,043 | (24,310 | ) | 814 | |||||||||||||
Other income - oil and gas | 363 | 1,222 | 4,759 | 16,931 | |||||||||||||||
Income (loss) before income taxes | (506,172 | ) | 7,153 | (478,170 | ) | 262,521 | |||||||||||||
Income tax provision (benefit) | (102,305 | ) | (807 | ) | (101,190 | ) | 66,971 | ||||||||||||
Net income (loss), including noncontrolling interests | (403,867 | ) | 7,960 | (376,980 | ) | 195,550 | |||||||||||||
Less net income applicable to noncontrolling interests | - | - | - | (503 | ) | ||||||||||||||
Net income (loss) applicable to common shareholders | $ | (403,867 | ) | $ | 7,960 | $ | (376,980 | ) | $ | 195,047 | |||||||||
Earnings (loss) per share of common stock: | |||||||||||||||||||
Basic | $ | (3.83 | ) | $ | 0.08 | $ | (3.58 | ) | $ | 1.85 | |||||||||
Diluted | $ | (3.83 | ) | $ | 0.08 | $ | (3.58 | ) | $ | 1.85 | |||||||||
Weighted average common shares outstanding: | |||||||||||||||||||
Basic | 105,574 | 105,005 | 105,416 | 105,029 | |||||||||||||||
Diluted | 105,574 | 105,005 | 105,416 | 105,045 | |||||||||||||||
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Comparative Condensed Consolidated Balance Sheets | ||||||||||||||||||
ASSETS | LIABILITIES & SHAREHOLDERS' EQUITY | |||||||||||||||||
(in thousands) |
Dec. 31, 2015 | Dec. 31, 2014 | (in thousands) | Dec. 31, 2015 | Dec. 31, 2014 | |||||||||||||
(unaudited) | (unaudited) | |||||||||||||||||
Current Assets: | Current Liabilities: | |||||||||||||||||
Cash and cash equivalents (1) | $ | 494,192 | $ | 476,492 | Accounts payable | $ | 65,370 | $ | 83,403 | |||||||||
Accounts receivable, net | 96,752 | 135,300 | Accrued liabilities | 71,641 | 104,923 | |||||||||||||
Current deferred tax assets | 53,573 | 31,180 | Income tax payable | 2,261 | 9,143 | |||||||||||||
Other current assets | 39,518 | 51,301 | Current maturities of long-term debt (1) | 71,640 | 28,144 | |||||||||||||
Total Current Assets | 684,035 | 694,273 | Total Current Liabilities | 210,912 | 225,613 | |||||||||||||
Property & equipment, net | 1,603,009 | 1,735,384 | Long-term debt (1) | 689,688 | 523,228 | |||||||||||||
Equity investments | 26,200 | 149,623 | Deferred tax liabilities | 180,974 | 260,275 | |||||||||||||
Goodwill | 45,107 | 62,146 | Other non-current liabilities | 51,415 | 38,108 | |||||||||||||
Other assets, net | 53,601 | 59,272 | Shareholders' equity (1) | 1,278,963 | 1,653,474 | |||||||||||||
Total Assets | $ | 2,411,952 | $ | 2,700,698 | Total Liabilities & Equity | $ | 2,411,952 | $ | 2,700,698 |
(1) |
Net debt to book capitalization - 17% at December 31, 2015. Calculated as net debt (total long-term debt less cash and cash equivalents - $267,136) divided by the sum of net debt and shareholders' equity ($1,546,099). |
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Helix Energy Solutions Group, Inc. | ||||||||||||||||||||||
Reconciliation of Non-GAAP Measures | ||||||||||||||||||||||
Earnings Release: |
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Reconciliation from Net Income (Loss) Applicable to Common Shareholders to Adjusted EBITDA: | ||||||||||||||||||||||
Three Months Ended |
Twelve Months Ended |
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12/31/2015 | 12/31/2014 | 9/30/2015 | 12/31/2015 | 12/31/2014 | ||||||||||||||||||
|
(in thousands) |
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Net income (loss) applicable to common shareholders | $ | (403,867 | ) | $ | 7,960 | $ | 9,880 | $ | (376,980 | ) | $ | 195,047 | ||||||||||
Adjustments: | ||||||||||||||||||||||
Net income applicable to noncontrolling interests | - | - | - | - | 503 | |||||||||||||||||
Income tax provision (benefit) | (102,305 | ) | (807 | ) | 94 | (101,190 | ) | 66,971 | ||||||||||||||
Net interest expense | 8,896 | 5,003 | 8,713 | 26,914 | 17,859 | |||||||||||||||||
Other (income) expense, net | 18,113 | (1,043 | ) | 5 | 24,310 | (814 | ) | |||||||||||||||
Depreciation and amortization | 34,068 | 28,071 | 32,805 | 120,401 | 109,345 | |||||||||||||||||
Asset impairments | 345,010 | - | - | 345,010 | - | |||||||||||||||||
Goodwill impairment | 16,399 | - | - | 16,399 | - | |||||||||||||||||
Non-cash losses on equity investments | 122,765 | - | - | 122,765 | - | |||||||||||||||||
EBITDA | 39,079 | 39,184 | 51,497 | 177,629 | 388,911 | |||||||||||||||||
Adjustments: | ||||||||||||||||||||||
Noncontrolling interests | - | - | - | - | (661 | ) | ||||||||||||||||
(Gain) loss on disposition of assets, net | (92 | ) | 178 | - | (92 | ) | (10,240 | ) | ||||||||||||||
Realized losses from cash settlements of ineffective foreign currency derivative contracts | (4,801 | ) | - | - | (4,801 | ) | - | |||||||||||||||
Adjusted EBITDA | $ | 34,186 | $ | 39,362 | $ | 51,497 | $ | 172,736 | $ | 378,010 |
We define EBITDA as earnings before income taxes, net interest expense, net other income or expense, and depreciation and amortization expense. We separately disclose our non-cash asset impairment charges, which, if not material, would be reflected as a component of our depreciation and amortization expense. Because these impairment charges are material to our 2015 results of operations, we have reported them as a separate line item in the accompanying condensed consolidated statements of operations. Non-cash goodwill impairment and non-cash losses on equity investments are also added back if applicable. To arrive at our measure of Adjusted EBITDA, we exclude the noncontrolling interests related to the adjustment components of EBITDA and the gain or loss on disposition of assets. In addition, we include realized losses from the cash settlements of our ineffective foreign currency derivative contracts, which are excluded from EBITDA as a component of net other income or expense. These non-GAAP measures are useful to investors and other internal and external users of our financial statements in evaluating our operating performance because they are widely used by investors in our industry to measure a company's operating performance without regard to items that can vary substantially from company to company, and help investors meaningfully compare our results from period to period. EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for, but instead are supplemental to, income from operations, net income or other income data prepared in accordance with GAAP. Non-GAAP financial measures should be viewed in addition to, and not as an alternative to our reported results prepared in accordance with GAAP. Users of this financial information should consider the types of events and transactions that are excluded from these measures. |
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Reconciliation of Significant Charges |
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Earnings Release: |
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Reconciliation of Significant Charges: |
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Three Months Ended |
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12/31/2015 |
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(in thousands, | ||||||
except per share data) | ||||||
Impairments and other non-cash charges: | ||||||
Production Facilities asset impairments | $ | 256,198 | ||||
Helix 534 impairment | 205,238 | |||||
Other Well Intervention asset impairments | 6,339 | |||||
Goodwill impairment | 16,399 | |||||
Unrealized losses associated with ineffectiveness of our foreign currency derivative contracts | 18,957 | |||||
Tax benefit associated with the above | (104,624 | ) | ||||
Impairments and other charges, net | $ | 398,507 | ||||
Diluted shares | 105,574 | |||||
Net after income tax effect per share | $ | 3.77 | ||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20160222006714/en/
Source:
Helix Energy Solutions Group, Inc.
Erik Staffeldt, 281-618-0400
Vice
President - Finance & Accounting