Global Industries, Ltd. Announces Results for the Third Quarter of 2009
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CARLYSS, La., Nov. 4 /PRNewswire-FirstCall/ -- Global Industries, Ltd. (Nasdaq: GLBL) announced revenues of $203.7 million for the third quarter of 2009 compared to $218.6 million in the third quarter of 2008. Net income was $14.0 million, or $0.12 per diluted share, for the third quarter of 2009 compared to a loss of $103.1 million, or $0.90 per diluted share, in the third quarter of 2008.
Commenting on the third quarter results, Chairman and Chief Executive Officer John A. Clerico stated, "Despite a significant reduction in revenue from the second quarter of 2009, we were able to generate positive results for the third quarter as we continued to focus on efficient project execution and cost management. Our cash position remains strong at $380 million. We are working hard to secure as many new projects as possible by developing effective and cost-competitive solutions for customers."
During the third quarter of 2009, our Company booked $135.7 million of new work resulting in a backlog of $147.6 million as of September 30, 2009. This compares to a backlog of $397.2 million at September 30, 2008. Commenting on the backlog results, John Clerico stated, "Due to continued delays and postponements of new offshore oil and gas development projects, especially in Latin America, our backlog is at its lowest level for some time. We expect industry conditions to remain difficult for the next several quarters. We are, however, beginning to see a number of potential projects emerge which will commence in late 2010 and beyond. Our new Global 1200, as well as several of our other vessels, position us to compete effectively for a number of these projects. In addition to our business development efforts, we will also continue to proactively implement cost control measures to appropriately size our operations."
Revenue for the third quarter of 2009 included the completion of the Berri and Qatif project in Saudi Arabia and the Camarupim project in Brazil, pipeline repairs in Mexico and Brazil, and pipeline installation projects in India, Indonesia and Thailand. An increase in activity in North America OCD and North America Subsea consisting of smaller projects and dive support services also contributed to revenues for the quarter.
Selling, general and administrative expenses of $19.1 million for the third quarter of 2009 decreased by $6.3 million over the same quarter last year, due to continuing company-wide cost control activities. Interest income of $0.4 million for the third quarter of 2009 decreased by $2.1 million over the same quarter last year primarily due to substantially lower interest rates.
A conference call will be held at 9:00 a.m. Central Time on November 5, 2009. Anyone wishing to listen to the conference call may dial 888-677-0183 (domestic) or 1-773-756-0451 (international) and request connection to the "Global Third Quarter Earnings" call. Phone lines will open fifteen minutes prior to the start of the call. The call will also be webcast in real time on our Company's website at www.globalind.com, where it will also be archived for anytime reference until November 26, 2009.
All individuals listening to the conference call or the replay are reminded that all conference call material is copyrighted by Global and cannot be recorded or rebroadcast without Global's express written consent.
Global Industries, Ltd. is a leading solutions provider of offshore construction, engineering, project management, and support services including pipeline construction, platform installation and removal, deepwater/SURF installations, IRM, and diving to the oil and gas industry worldwide. Our Company's shares are traded on The NASDAQ Global Select Market under the symbol "GLBL."
This press release may contain forward-looking statements within the meaning of the federal securities laws. These statements are based on current information and expectations of Global that involve a number of risks, uncertainties, and assumptions. Among the factors that could cause the actual results to differ materially are: Global's level of capital expenditures, worldwide economic conditions, various risks related to international operations, our ability to retain skilled workers, general industry conditions, prices of crude oil and natural gas, our ability to obtain and the timing of new projects and changes in competitive factors. Although we believe that in making such statements our expectations are based on reasonable assumptions, should one or more of these risks or uncertainties materialize, or should the underlying assumptions prove incorrect, actual outcomes could vary materially from those indicated.
ASC 470-20, "Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion (Including Partial Cash Settlement)" became effective for our Company beginning January 1, 2009 and is applied retrospectively to all periods presented in this news release.
Set forth are our Company's results of operations for the periods indicated.
RESULTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Nine Months Ended
September 30 September 30
------------------- -----------------
2009 2008 2009 2008
------- --------- ------- --------
As As
adjusted adjusted
$203,718 $ 218,551 $768,010 $820,559
Revenues
Cost of operations 163,855 307,409 617,609 847,251
------- --------- ------- --------
Gross profit (loss) 39,863 (88,858) 150,401 (26,692)
Loss (gain) on asset
disposals and
impairments 274 1,640 (8,249) (372)
Selling, general and
administrative
expenses 19,075 25,439 55,635 73,439
------- --------- ------- --------
Operating income
(loss) 20,514 (115,937) 103,015 (99,759)
Interest income 402 2,476 1,594 12,709
Interest expense (2,756) (4,642) (9,978) (12,578)
Other income
(expense), net 9 (234) 6,579 (1,866)
------- --------- ------- --------
Income (loss) before
taxes 18,169 (118,337) 101,210 (101,494)
Income tax expense
(benefits) 4,151 (15,229) 22,228 (10,364)
------- --------- ------- --------
Net income (loss) $14,018 $(103,108) $ 78,982 $(91,130)
======= ========= ======== ========
Earnings (Loss) Per
Common Share
Basic $ 0.12 $ (0.90) $ 0.69 $ (0.80)
Diluted $ 0.12 $ (0.90) $ 0.69 $ (0.80)
Weighted Average Common Shares
Outstanding
Basic 112,693 114,493 112,550 114,135
Diluted 113,278 114,493 113,118 114,135
Other Data
Depreciation and
Amortization $17,924 $ 19,762 $ 52,634 $ 50,724
Backlog at end of
period $147,584 $397,220
During the first quarter of 2009, we discontinued allocation of corporate
stewardship costs to our reportable segments. This change has been
reflected as a retrospective change to the financial information for the
three months and nine months ended September 30, 2008 presented below.
This change did not affect our consolidated results of operations or tax
reporting.
Set forth are our Company's results of operations by reportable segment
for the periods indicated.
RESULTS OF OPERATIONS BY REPORTABLE SEGMENT
(In thousands)
(Unaudited)
Three Months Ended Nine Months Ended
September 30 September 30
------------------- -------------------
2009 2008 2009 2008
-------- -------- -------- --------
As adjusted As adjusted
Total segment revenues
North America OCD $ 60,011 $ 28,868 $108,961 $ 58,440
North America Subsea 46,343 43,422 112,093 103,122
Latin America 35,749 59,509 185,534 185,259
West Africa (529) 22,924 101,039 140,664
Middle East 28,668 35,638 82,167 188,085
Asia Pacific/India 47,433 40,423 206,880 172,317
-------- -------- -------- --------
Subtotal 217,675 230,784 796,674 847,887
-------- -------- -------- --------
Intersegment eliminations
North America Subsea (13,957) (10,159) (25,394) (23,187)
Latin America - (2,074) - (2,074)
Middle East - - (3,270) (2,067)
-------- -------- -------- --------
Subtotal (13,957) (12,233) (28,664) (27,328)
-------- -------- -------- --------
Consolidated revenues $203,718 $ 218,551 $768,010 $ 820,559
======== ======== ======== =========
Income (loss) before taxes
North America OCD $12,903 $ (5,961) $4,924 $ (11,873)
North America Subsea 10,267 522 25,972 6,906
Latin America (10,642) (19,648) 11,825 (12,132)
West Africa (2,709) (10,103) 30,150 (19,387)
Middle East 6,337 (83,273) 15,913 (73,768)
Asia Pacific/India 9,333 10,805 34,351 35,317
Corporate (7,320) (10,679) (21,925) (26,557)
-------- -------- -------- --------
Consolidated income (loss)
before taxes $ 18,169 $(118,337) $101,210 $(101,494)
======== ========= ======== =========
CONSOLIDATED BALANCE SHEETS
(In thousands)
September 30, December 31,
2009 2008
------------- ------------
Unaudited
ASSETS
Current Assets
Cash and cash equivalents $ 380,616 $ 287,669
Restricted cash 1,139 94,516
Marketable securities 31,150 -
Accounts receivable - net
of allowance of $1,070
for 2009 and $12,070 for 2008 147,842 180,018
Unbilled work on uncompleted
contracts 116,994 86,011
Contract costs incurred not
yet recognized 2,619 11,982
Deferred income taxes 2,937 7,223
Assets held for sale 8,820 2,181
Prepaid expenses and other 57,398 44,585
---------- ----------
Total current assets 749,515 714,185
---------- ----------
Property and Equipment, net 680,288 599,078
---------- ----------
Other Assets
Marketable securities - long-term 11,103 42,375
Accounts receivable - long-term 24,237 22,246
Deferred charges, net 54,948 70,573
Goodwill 37,388 37,388
Other 8,821 3,508
---------- ----------
Total other assets 136,497 176,090
---------- ----------
Total $1,566,300 $1,489,353
========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current Liabilities
Current maturities of long term debt $ 3,960 $3,960
Accounts payable 222,938 207,239
Employee-related liabilities 24,839 26,113
Income taxes payable 53,372 38,649
Accrued interest payable 2,229 5,613
Advance billings on uncompleted contracts 394 4,609
Accrued anticipated contract losses 100 35,055
Other accrued liabilities 8,364 12,053
---------- ----------
Total current liabilities 316,196 333,291
---------- ----------
Long-Term Debt 292,225 289,966
Deferred Income Taxes 69,604 64,020
Other Liabilities 13,318 13,266
Commitments and Contingencies - -
Shareholders' Equity
Common stock, $0.01 par value,
150,000 shares authorized, and
120,020 and 119,650 shares issued
at September 30, 2009 and December
31, 2008, respectively 1,200 1,197
Additional paid-in capital 513,309 509,345
Retained earnings 473,681 394,699
Treasury stock at cost, 6,130
shares (105,038) (105,038)
Accumulated other comprehensive
loss (8,195) (11,393)
---------- ----------
Total shareholders' equity 874,957 788,810
---------- ----------
Total $1,566,300 $1,489,353
========== ==========
SOURCE Global Industries, Ltd.
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