EX-99.1 3 h09622exv99w1.txt PRESS RELEASE DATED OCTOBER 14, 2003 [VERITAS DGC LOGO] VERITAS DGC INC. REVISES ITS PREVIOUSLY ANNOUNCED FOURTH QUARTER AND FISCAL 2003 RESULTS HOUSTON, OCTOBER 14, 2003 - Veritas DGC Inc. (NYSE & TSE: VTS) announced today that it has revised its previously announced 2003 fourth quarter and fiscal year unaudited results due to an increase in its deferred tax valuation allowance. The adjustment will increase the previously reported net loss by $11.8 million, or $0.35 per share. The revised results are included as an attachment to this release. The additional tax provision was based on conclusions reached during the year-end audit process. As a result of recent net operating losses, the Company determined that deferred tax assets in several jurisdictions (primarily the U.S.) should be fully reserved, resulting in an $11.8 million reduction. Previously, the value of the Company's deferred tax asset was based on the expected realization of scheduled timing differences and net operating loss carryforwards. The adjustment will not have a material impact on the Company's cash flow or debt covenants. This adjustment could result in a reduction in the Company's effective tax rate in future years upon the recognition of profits in these jurisdictions. The Company expects to file its final audited results with the Securities and Exchange Commission on Form 10-K during the next week. The Company cautions that statements in this release may constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include statements as to expectations, beliefs and future financial performance, such as statements regarding our business prospects. All of these are based on current information and expectations that are subject to a number of risks, uncertainties and assumptions. These risks and uncertainties are more fully described in our reports filed with the Securities and Exchange Commission. Should one or more of these risks or uncertainties materialize, or should the assumptions prove incorrect, actual results may vary in material respect from those currently anticipated. Veritas DGC Inc., headquartered in Houston, Texas, is a leading provider of integrated geophysical and reservoir technologies to the petroleum industry worldwide. For additional information, please visit Veritas's website at www.veritasdgc.com or contact: Mindy Ingle, Investor Relations (832) 351-8821 Matt Fitzgerald, Executive Vice President, Chief Financial Officer & Treasurer VERITAS DGC INC. AND SUBSIDIARIES UNAUDITED --------- CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per share amounts)
THREE MONTHS ENDED FISCAL YEAR ENDED JULY 31, JULY 31, ----------------------------- ---------------------------------- 2003 2002 2003 2002 -------------- ------------- --------------- -------------- Revenue $ 119,537 $105,415 $503,001 $ 455,683 Operating expenses: Cost of services 106,546 78,763 425,217 353,178 Research and development 2,303 3,094 11,630 11,475 General and administrative 5,467 5,877 27,211 23,763 Loss on (RC)2 sale 7,627 7,627 Impairment of multi-client surveys 4,893 55,204 4,893 55,204 Cost of terminated merger 10,191 14,607 Impairment of goodwill 39,263 39,263 -------------- ------------- --------------- -------------- Operating loss (46,562) (47,714) (12,840) (2,544) Interest expense 4,175 3,778 18,534 13,628 Other expense (income), net (731) 4,005 498 1,786 -------------- ------------- --------------- -------------- Loss before provision for income taxes (50,006) (55,497) (31,872) (17,958) Income tax expense (benefit) 20,699 (8,980) 28,052 5,192 -------------- ------------- --------------- -------------- Net loss $ (70,705) $ (46,517) $ (59,924) $ (23,150) ============== ============= =============== ============== Diluted Earnings Per Share: Weighted average common shares 33,462 32,491 33,305 32,409 Loss per common share $ (2.11) $ (1.43) $ (1.80) $ (0.71) Supplemental Data: Cash 72,626 10,586 72,626 10,586 Multi-client data library 371,949 336,475 371,949 336,475 Interest-bearing debt 194,225 140,000 194,225 140,000 Depreciation and amortization, gross 16,856 16,842 72,664 68,341 Depreciation and amortization, net of amounts capitalized to multi-client library 12,102 8,906 48,304 39,097 Multi-client amortization, excluding impairments 35,220 25,720 142,029 115,287 Free Cash Flow: Cash from operating activities 38,572 36,884 200,714 185,272 Less: Multi-client expenditures, net cash 29,041 41,985 151,693 169,039 Capital expenditures 10,967 15,036 30,497 87,096 ------ ------ -------- ------- Free cash flow (1,436) (20,137) 18,524 (70,863)