8-K

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 15, 2007

COMPLETE PRODUCTION SERVICES, INC.

(Exact name of registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation) 1-32058
(Commission
File Number) 72-1503959
(IRS Employer
Identification No.)

11700 Old Katy Road, Suite 300
Houston, Texas
(Address of principal executive offices) 77079
(Zip Code)

Registrant’s telephone number, including area code: (281) 372-2300

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

TABLE OF CONTENTS

TABLE OF CONTENTS
	Item 2.02 Results of Operations and Financial Condition
	Item 9.01 Financial Statements and Exhibits
SIGNATURE
Press Release

TABLE OF CONTENTS

Item 2.02	Results of Operations and Financial Condition
Item 9.01	Financial Statements and Exhibits
SIGNATURE

Item 2.02 Results of Operations and Financial Condition

     On February 15, 2007, Complete Production Services, Inc. issued a press release announcing its results of operations for the quarter and year ended December 31, 2006. This press release is filed as Exhibit 99.1 to this Current Report on Form 8-K, and its contents are hereby incorporated by reference into this report.

     The information in this Report and the exhibit attached hereto shall not be deemed “filed” for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), nor shall this Report and exhibit be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly stated by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits

(d) Exhibits

99.1 Press release issued on February 15, 2007

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: February 16, 2007

Complete Production Services, Inc.
By:	/s/ J. Michael Mayer
	J. Michael Mayer
	Senior Vice President and Chief Financial Officer

COMPLETE PRODUCTION SERVICES, INC.
EXHIBIT INDEX TO FORM 8-K

EXHIBIT NO.	ITEM
99.1	Press release issued on February 15, 2007

EX-99.1

EXHIBIT 99.1

Complete Production Services, Inc. Reports
Fourth Quarter Earnings Per Share of $0.61

HOUSTON, February 15, 2007 (BUSINESS WIRE) — Complete Production Services, Inc. (NYSE: CPX) today reported record revenue, net income and earnings per diluted share from continuing operations for the fourth quarter of 2006. Revenue for the quarter increased 64% to $363.5 million compared to $221.6 million in the fourth quarter of 2005. Net income from continuing operations for the quarter was $44.1 million, or $0.61 per diluted share, up 196% and 135%, respectively, compared to the fourth quarter of 2005.

Operating income for the quarter increased to $77.0 million, representing an operating profit margin of 21.2%. This compares to $33.9 million and 15.3% in the prior year. Operating income for the year increased to $254.7 million from $112.2 million in the prior year, as operating profit margin rose to 21.0% from 15.6% in 2005. Incremental operating profit margin for the fourth quarter and full year were 30.4% and 28.9%, respectively.

Full year 2006 revenue from continuing operations was $1.2 billion, up 68% over the prior year, while net income from continuing operations was $137.3 million, up 170% compared to the prior year. Full year 2006 earnings per diluted share from continuing operations was $2.02 per share versus $1.00 per share in 2005. As previously disclosed, the Company sold its manufacturing, fabrication and unrelated production enhancement products business in Canada during the fourth quarter of 2006. Accordingly, these operations are accounted for as discontinued operations for each period presented within this release.

“2006 was an outstanding year for Complete Production Services. Our strategy of balanced growth within targeted basins of North America is evident in our performance,” said Joe Winkler, President and Chief Executive Officer of Complete. “Approximately 75% of our $492 million in annual revenue growth was from organic initiatives with the balance from selective acquisitions.”

“During the year we invested in excess of $240 million in growth capital, taking advantage of our solid market position in the resource plays to quickly and efficiently deploy new equipment to meet our customer’s demands for our services. In addition, we completed approximately $420 million in acquisitions to strengthen our already existing position, expand our geographic reach and to enter new service lines. Although harsh winter weather and holidays slowed our year end pace, our business performed quite well during Quarter 4. Overall, we are very pleased with the outcome of our 2006 strategic initiatives and believe they have set the foundation for our performance in 2007.”

Earnings before interest, taxes, depreciation and amortization (EBITDA, as defined below) totals $102.7 million for the current quarter, up 108% compared to the fourth quarter of 2005. As a percentage of revenue, EBITDA was 28.3% in the current quarter, 22.2% in the fourth quarter of 2005 and 29.0% in the third quarter of 2006.

Complete Production Services, Inc. provides completion, production and drilling services and products to the oil and gas industry in many of the most active basins throughout North America. We will hold our quarterly conference call to discuss fourth quarter 2006 results on Friday, February 16 at 10:00 a.m. Central Time. To participate in the live conference call, dial (866) 362-5158 at least ten minutes prior to the scheduled start of the call. When prompted, provide the passcode: 21153858. The conference call will be available for replay beginning at 1:00 p.m., February 16, 2007, and will be available until February 23, 2007. To access the conference call replay, please call (888) 286-8010 and use the passcode: 87590401. The call is also being webcast and can be accessed at our website at www.completeproduction.com.

The foregoing contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Forward-looking statements are those that do not state historical facts and are, therefore, inherently subject to risk and uncertainties. The forward-looking statements included herein are based on current expectations and entail various risks and uncertainties that could cause actual results to differ materially from those forward-looking statements. Such risks and uncertainties include, among other things, risks associated with the general nature of the oilfield service industry. The company undertakes no obligation to publicly update or revise any forward-looking statements to reflect events or circumstances that may arise after the date of this press release.

Management evaluates the performance of our operating segments using a non-GAAP financial measure, EBITDA. EBITDA is calculated as net income from continuing operations before net interest expense, taxes, depreciation and amortization and minority interest. EBITDA is not a substitute for the GAAP measures of earnings and cash flow. EBITDA is used in this press release because our management considers it an important supplemental measure of performance and believes it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in our industry.

For more information, please contact:

Mike Mayer
Senior Vice President and Chief Financial Officer
281-372-2311
mmayer@completeproduction.com

Complete Production Services, Inc.
Unaudited Consolidated Statements of Operations
For the Quarters and Years Ended December 31, 2006 and 2005
(in thousands, except per share data)

	Quarter Ended					Year Ended
	December 31,					December 31,
	2006			2005		2006			2005
	(unaudited)			(unaudited)		(unaudited)			(unaudited)
Revenue:
Services	$	331,218		$	199,251	$	1,088,748		$	639,421
Products		32,290			22,313		123,676			80,768
		363,508			221,564		1,212,424			720,189
Cost of services		187,257			122,087		622,786			393,856
Cost of products		21,137			14,486		88,175			56,862
General and administrative expense		52,249			35,255		167,334			108,766
Depreciation and amortization		25,854			15,837		79,465			48,510
		286,497			187,665		957,760			607,994
Operating income		77,011			33,899		254,664			112,195
Interest expense		11,447			8,844		40,759			24,460
Interest income		(109	)		—		(1,387	)		—
Write-off of deferred financing costs		170			471		170			3,315
Income from continuing operations before minority interest and taxes		65,503			24,584		215,122			84,420
Minority interest, net of tax		(72	)		4		(49	)		384
Income from continuing operations before taxes		65,575			24,580		215,171			84,036
Tax provision		21,477			9,707		77,888			33,115
Income from continuing operations		44,098			14,873		137,283			50,921
Income (loss) from discontinued operations (net of tax)		(518	)		1,077		1,803			2,941
Net income	$	43,580		$	15,950	$	139,086		$	53,862
Basic earnings per share:
Continuing Operations	$	0.62		$	0.27	$	2.09		$	1.09
Discontinued Operations	$	(0.00	)	$	0.02	$	0.02		$	0.07
	$	0.62		$	0.29	$	2.11		$	1.16
Diluted earnings per share:
Continuing Operations	$	0.61		$	0.26	$	2.02		$	1.00
Discontinued Operations	$	(0.01	)	$	0.02	$	0.02		$	0.06
	$	0.60		$	0.28	$	2.04		$	1.06
Weighted average shares outstanding:
Basic		70,670			55,361		65,843			46,603
Diluted		72,492			57,360		68,075			50,656

Complete Production Services, Inc.
Unaudited Condensed Consolidated Balance Sheets
As of December 31, 2006 and 2005
(in thousands)

	December 31,			December 31,
	2006			2005
	(unaudited)			(unaudited)
Assets:
Current assets	$	390,640		$	228,818
Property, plant and equipment, net		771,703			383,707
Goodwill		552,671			293,651
Other long-term assets		25,310			6,558
Discontinued operations		—			24,919
Total assets		1,740,324			937,653
Liabilities and Stockholders’ Equity:
Current liabilities		175,401			114,753
Long-term debt		750,577			509,981
Long-term deferred tax liabilities		76,802			54,084
Minority interest		2,323			2,365
Discontinued operations		—			5,709
Total liabilities and minority interest		1,005,103			686,892
Common stock		714			555
Treasury stock		(202	)		(202	)
Additional paid-in capital		563,006			220,786
Deferred compensation		—			(3,803	)
Retained earnings		155,971			16,885
Cumulative translation adjustment		15,732			16,540
Total stockholders’ equity		735,221			250,761
Total liabilities and stockholders’ equity	$	1,740,324		$	937,653

Complete Production Services, Inc.
Unaudited Consolidated Segment Information
For the Quarters Ended December 31, 2006 and 2005 and September 30, 2006
and Years Ended December 31, 2006 and 2005
(in thousands)

	Quarter Ended
	December 31,			December 31,			September 30,
	2006			2005			2006
	(unaudited)			(unaudited)			(unaudited)
Revenue:
Completion and production services	$	269,041		$	159,150		$	230,093
Drilling services		62,177			40,101			57,898
Products		32,290			22,313			34,043
Total revenues	$	363,508		$	221,564		$	322,034
EBITDA: (1)
Completion and production services	$	80,705		$	34,475		$	73,003
Drilling services		23,176			14,837			21,110
Products		6,257			4,163			4,677
Corporate and other		(7,443	)		(4,210	)		(5,551	)
Total EBITDA	$	102,695		$	49,265		$	93,239
EBITDA as a % of Revenue:
Completion and production services		30.0	%		21.7	%		31.7	%
Drilling services		37.3	%		37.0	%		36.5	%
Products		19.4	%		18.7	%		13.7	%
Total		28.3	%		22.2	%		29.0	%

	Year Ended December 31,
	2006			2005
	(unaudited)			(unaudited)
Revenue:
Completion and production services	$	873,493		$	510,304
Drilling services		215,255			129,117
Products		123,676			80,768
Total revenues	$	1,212,424		$	720,189
EBITDA: (1)
Completion and production services	$	257,630		$	114,033
Drilling services		78,543			42,336
Products		18,708			12,634
Corporate and other		(20,922	)		(11,613	)
Total EBITDA	$	333,959		$	157,390
EBITDA as a % of Revenue:
Completion and production services		29.5	%		22.3	%
Drilling services		36.5	%		32.8	%
Products		15.1	%		15.6	%
Total		27.5	%		21.9	%

(1) EBITDA is a non-GAAP measure used by management, as defined in the last paragraph of this press release.

Footnote: The results for all periods exclude discontinued operations.

Complete Production Services, Inc.
Reconciliation of EBITDA to the most Comparable GAAP Measure
For the Quarters Ended December 31, 2006 and 2005 and September 30, 2006
and the Years Ended December 31, 2006 and 2005
(unaudited, in thousands)

	Completion
	& Production		Drilling				Corporate &
	Services		Services		Products		Other			Total
Quarter Ended December 31, 2006:
EBITDA	$	80,705	$	23,176	$	6,257	$	(7,443	)	$	102,695
Depreciation & amortization		21,694		3,439		430		291			25,854
Write-off of deferred financing costs		—		—		—		(170	)		(170	)
Operating Income (loss)	$	59,011	$	19,737	$	5,827	$	(7,564	)	$	77,011
Quarter Ended December 31, 2005:
EBITDA	$	34,475	$	14,837	$	4,163	$	(4,210	)	$	49,265
Depreciation & amortization		13,049		1,698		275		815			15,837
Write-off of deferred financing costs		—		—		—		(471	)		(471	)
Operating Income (loss)	$	21,426	$	13,139	$	3,888	$	(4,554	)	$	33,899
Quarter Ended September 30, 2006:
EBITDA	$	73,003	$	21,110	$	4,677	$	(5,551	)	$	93,239
Depreciation & amortization		16,895		2,858		574		678			21,005
Operating Income (loss)	$	56,108	$	18,252	$	4,103	$	(6,229	)	$	72,234
Year Ended December 31, 2006
EBITDA	$	257,630	$	78,543	$	18,708	$	(20,922	)	$	333,959
Depreciation & amortization		65,317		10,599		1,943		1,606			79,465
Write-off of deferred financing costs		—		—		—		(170	)		(170	)
Operating Income (loss)	$	192,313	$	67,944	$	16,765	$	(22,358	)	$	254,664
Year Ended December 31, 2005
EBITDA	$	114,033	$	42,336	$	12,634	$	(11,613	)	$	157,390
Depreciation & amortization		40,149		5,666		1,250		1,445			48,510
Write-off of deferred financing costs		—		—		—		(3,315	)		(3,315	)
Operating Income (loss)	$	73,884	$	36,670	$	11,384	$	(9,743	)	$	112,195