-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Q+UUvr0TJNWr2wg6VH7yIFX+OPARampO3Cc7rGSlzs5uJpGY4XGHXZbU9zx+QG+C iJsFIf4uVAIukcbetoGDLw== 0000950134-01-500794.txt : 20010427 0000950134-01-500794.hdr.sgml : 20010427 ACCESSION NUMBER: 0000950134-01-500794 CONFORMED SUBMISSION TYPE: 10-K405/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20001231 FILED AS OF DATE: 20010426 FILER: COMPANY DATA: COMPANY CONFORMED NAME: MCDERMOTT INTERNATIONAL INC CENTRAL INDEX KEY: 0000708819 STANDARD INDUSTRIAL CLASSIFICATION: FABRICATED PLATE WORK (BOILER SHOPS) [3443] IRS NUMBER: 720593134 STATE OF INCORPORATION: R1 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-K405/A SEC ACT: SEC FILE NUMBER: 001-08430 FILM NUMBER: 1611740 BUSINESS ADDRESS: STREET 1: 1450 POYDRAS ST CITY: NEW ORLEANS STATE: LA ZIP: 70112 BUSINESS PHONE: 5045875400 MAIL ADDRESS: STREET 1: 1450 POYDRAS ST CITY: NEW ORLEANS STATE: LA ZIP: 70161 10-K405/A 1 d86453a1e10-k405a.txt AMENDMENT NO. 1 TO FORM 10-K - FISCAL END 12/31/00 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 (Mark One) FORM 10-K/A [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2000 OR [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to --------- ---------- Commission File Number 1-8430 McDERMOTT INTERNATIONAL, INC. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) REPUBLIC OF PANAMA 72-0593134 - -------------------------------------------------------------------------------------------------------------- (State or Other Jurisdiction of Incorporation or Organization) (I.R.S. Employer Identification No.) 1450 POYDRAS STREET NEW ORLEANS, LOUISIANA 70112-6050 - -------------------------------------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, Including Area Code (504) 587-5400 Securities Registered Pursuant to Section 12(b) of the Act:
Name of each Exchange Title of each class on which registered ------------------- ------------------- Common Stock, $1.00 par value New York Stock Exchange Rights to Purchase Preferred Stock New York Stock Exchange (Currently Traded with Common Stock)
Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES [X] NO [ ] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [X] The aggregate market value of the registrant's common stock held by non-affiliates of the registrant was $843,523,016 as of January 29, 2001. The number of shares outstanding of the Company's Common Stock at January 29, 2001 was 60,677,340. DOCUMENTS INCORPORATED BY REFERENCE Portions of the registrant's Proxy Statement to be filed with the Securities and Exchange Commission pursuant to Regulation 14A under the Securities Exchange Act of 1934 in connection with the Company's 2001 Annual Meeting of Stockholders are incorporated by reference into Part III hereof. 2 McDERMOTT INTERNATIONAL, INC. INDEX TO FINANCIAL STATEMENT SCHEDULES AND EXHIBITS
Page Report of PricewaterhouseCoopers LLP 3 Financial Statement Schedule Covered by Reports of Independent Accountants: I Condensed Financial Information of Registrant 4 All schedules other than the above have been omitted because they are not required or the information is included in the Consolidated Financial Statements or Notes thereto. Signature of Registrant 12 Exhibit Index 99 Supplementary Financial Information on Panamanian Securities Regulations
2 3 REPORT OF INDEPENDENT ACCOUNTANTS ON FINANCIAL STATEMENT SCHEDULE To the Board of Directors and Stockholder of The McDermott International, Inc. We have audited the consolidated financial statements of McDermott International, Inc. (the "Company") as of December 31, 2000 and 1999, and for the year ended December 31, 2000, the nine-month period ended December 31, 1999, and the fiscal year ended March 31, 1999, and have issued our report thereon dated February 23, 2001. Our report includes an emphasis of matter paragraph referring to Note 20 of the consolidated financial statements which discusses certain asbestos-related claims against the Company's subsidiary, The Babcock & Wilcox Company ("B&W"), B&W's related voluntary petition with the U.S. Bankruptcy Court to reorganize under Chapter 11 of the U.S. Bankruptcy Code, and certain liquidity matters resulting from the filing. Our audit also included Schedule I - Condensed Financial Information of Registrant as of December 31, 2000 and 1999, and for the year ended December 31, 2000, the nine-month period ended December 31, 1999, and the fiscal year ended March 31, 1999. In our opinion, this financial statement schedule presents fairly, in all material respects, the information set forth therein when read in conjunction with the related consolidated financial statements. PricewaterhouseCoopers LLP New Orleans, Louisiana February 23, 2001, except for Note 4 as to which the date is April 5, 2001 3 4 Schedule I McDERMOTT INTERNATIONAL, INC. (PARENT COMPANY ONLY) CONDENSED BALANCE SHEETS ASSETS
December 31, 2000 1999 ---------- ---------- (In thousands) Current Assets: Cash and cash equivalents $ 46 $ 8,991 Accounts receivable - trade, net 75 338 Accounts receivable - other 567 1,811 Accounts receivable from subsidiaries 18,012 84,527 Other currents assets 863 808 ---------- ---------- Total Current Assets 19,563 96,475 ---------- ---------- Investments in Subsidiaries and Other Investees, at Equity 811,152 1,727,139 ---------- ---------- Notes Receivable from Subsidiaries 17,159 139,869 ---------- ---------- Property, Plant and Equipment, at Cost: Buildings 1,378 3,328 Machinery and equipment 538 6,710 ---------- ---------- 1,916 10,038 Less accumulated depreciation 1,916 10,038 ---------- ---------- Net Property, Plant and Equipment -- -- ---------- ---------- Investments in Debt Securities 28,672 29,230 ---------- ---------- Other Assets 32,835 38,631 ---------- ---------- TOTAL $ 909,381 $2,031,344 ========== ==========
See accompanying notes to condensed financial information. 4 5 Continued LIABILITIES AND STOCKHOLDERS' EQUITY
December 31, 2000 1999 ------------ ------------ (In thousands) Current Liabilities: Accounts payable $ 824 $ 399 Accounts payable to subsidiaries 54,022 1,165,472 Accrued liabilities - other 38,288 26,315 Income taxes 1,659 1,660 ------------ ------------ Total Current Liabilities 94,793 1,193,846 ------------ ------------ Notes Payable to Subsidiaries 36,845 41,566 ------------ ------------ Other Liabilities 1,140 4,074 ------------ ------------ Commitments and Contingencies Stockholders' Equity: Common stock 62,582 61,625 Capital in excess of par value 1,062,511 1,048,848 Accumulated deficit (230,902) (208,904) Treasury stock (62,736) (62,731) Accumulated other comprehensive loss (54,852) (46,980) ------------ ------------ Total Stockholders' Equity 776,603 791,858 ------------ ------------ TOTAL $ 909,381 $ 2,031,344 ============ ============
5 6 Schedule I McDERMOTT INTERNATIONAL, INC. (PARENT COMPANY ONLY) CONDENSED STATEMENTS OF INCOME (LOSS)
Nine-Month Fiscal Year Year Ended Period Ended Ended December 31, March 31, 2000 1999 1999 ------------ ------------ ------------ (In thousands) Costs and Expenses: Cost of operations (excluding depreciation and amortization) $ 5,300 $ 1,233 $ 201 Depreciation and amortization 1,450 1,131 1,479 Selling, general and administrative expenses 795 2,650 647 ------------ ------------ ------------ 7,545 5,014 2,327 ------------ ------------ ------------ Gain (Loss) on Asset Disposals-net (517) 1 -- ------------ ------------ ------------ Operating Loss before Equity in Income of Investees (8,062) (5,013) (2,327) ------------ ------------ ------------ Equity in Income (Loss) of Subsidiaries and Other Investees (7,243) 43,027 149,448 ------------ ------------ ------------ Operating Income (Loss) (15,305) 38,014 147,121 ------------ ------------ ------------ Other Income (Expense): Interest income 2,811 2,192 2,841 Interest expense (6,486) (9,932) (2,908) Other - net (5,442) (29,834) 18,693 ------------ ------------ ------------ (9,117) (37,574) 18,626 ------------ ------------ ------------ Income (Loss) before Benefit from Income Taxes and Extraordinary Item (24,422) 440 165,747 Benefit from Income Taxes (2,340) -- (12,067) ------------ ------------ ------------ Income (Loss) before Extraordinary Item (22,082) 440 177,814 Extraordinary Item -- -- (24,452) ------------ ------------ ------------ Net Income (Loss) $ (22,082) $ 440 $ 153,362 ============ ============ ============
See accompanying notes to condensed financial information. 6 7 Schedule I MCDERMOTT INTERNATIONAL, INC (PARENT COMPANY ONLY) CONDENSED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
Nine-Month Fiscal Year Year Ended Period Ended Ended December 31, March 31, 2000 1999 1999 ------------ ------------ ------------ (In thousands) Net Income (Loss) $ (22,082) $ 440 $ 153,362 ------------ ------------ ------------ Other Comprehensive Income (Loss): Equity in other comprehensive income (loss) of subsidiaries and other investees (8,386) (13,928) 14,078 Foreign currency translation adjustments -- -- (79) Minimum pension liability adjustments 18 63 15 Reclassification adjustment for gains (losses) included in net income 497 (470) (101) ------------ ------------ ------------ Other Comprehensive Income (Loss) (7,871) (14,335) 13,913 ------------ ------------ ------------ Comprehensive Income (Loss) (29,953) (13,895) 167,275 ============ ============ ============
See accompanying notes to condensed financial information. 7 8 Schedule I McDERMOTT INTERNATIONAL, INC. (PARENT COMPANY ONLY) CONDENSED STATEMENTS OF CASH FLOWS
Nine-Month Fiscal Year Year Ended Period Ended Ended December 31, March 31, 2000 1999 1999 ------------ ------------ ------------ (In thousands) CASH FLOWS FROM OPERATING ACTIVITIES: Net Income (Loss) $ (22,082) $ 440 $ 153,362 ------------ ------------ ------------ Adjustments to reconcile net income (loss) to net cash provided by operating activities: Depreciation and amortization 1,450 1,131 1,479 Equity in income or loss of subsidiaries and other investees, less dividends 7,243 (32,227) (105,796) Gain on asset disposals-net -- (1) -- Benefit from deferred taxes -- -- (1,437) Other 9,029 4,986 10,217 Changes in assets and liabilities: Accounts and notes receivable 1,507 11,161 12,022 Accounts payable (135,077) 77,747 222,533 Income taxes (1) (1) (1,236) Other, net 9,581 31,348 (62,803) ------------ ------------ ------------ NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (128,350) 94,584 228,341 ------------ ------------ ------------ CASH FLOWS FROM INVESTING ACTIVITIES: Proceeds from asset disposals -- 1 3 Investments in subsidiaries -- -- (158,000) Purchases of available-for-sale securities (10,473) (6,493) (16,010) Maturities of available-for-sale securities 10,325 6,600 7,000 Sales of available-for-sale securities 1,247 -- 17,834 Decrease (increase) in loans to subsidiaries 122,710 (87,248) (300) ------------ ------------ ------------ NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES 123,809 (87,140) (149,473) ------------ ------------ ------------
8 9 Continued
Nine-Month Fiscal Year Year Ended Period Ended Ended December 31, March 31, 2000 1999 1999 ------------ ------------ ------------ (In thousands) CASH FLOWS FROM FINANCING ACTIVITIES: Payment of long-term debt $ -- $ -- $ (12,200) Issuance of common stock 47 1,538 4,173 Dividends paid (8,972) (8,889) (13,810) Purchase of McDermott International, Inc. stock (5) -- (59,156) Other 4,526 (476) 1,227 ------------ ------------ ------------ NET CASH USED IN FINANCING ACTIVITIES (4,404) (7,827) (79,766) ------------ ------------ ------------ NET DECREASE IN CASH AND CASH EQUIVALENTS (8,945) (383) (898) ------------ ------------ ------------ CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD 8,991 9,374 10,272 ------------ ------------ ------------ CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 46 $ 8,991 $ 9,374 ============ ============ ============ SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION: Cash paid during the period for: Interest, including intercompany interest (net of amount capitalized) $ 6,453 $ 9,865 $ 3,182 Income taxes, net of refunds $ 361 $ 1 $ 1 ============ ============ ============ SUPPLEMENTAL SCHEDULE OF NON-CASH FINANCING ACTIVITIES: Settlement of intercompany balances with a subsidiary $ 932,935 $ -- $ -- ============ ============ ============
See accompanying notes to condensed financial information. 9 10 Schedule I McDERMOTT INTERNATIONAL, INC. (PARENT COMPANY ONLY) NOTES TO CONDENSED FINANCIAL INFORMATION DECEMBER 31, 2000 NOTE 1 - BASIS OF PRESENTATION The accompanying financial statements have been prepared to present the unconsolidated financial position, results of operations and cash flows of McDermott International, Inc. (Parent Company Only). Investments in subsidiaries and other investees are stated at cost plus equity in undistributed earnings from date of acquisition. These Parent Company Only financial statements should be read in conjunction with McDermott International, Inc.'s consolidated financial statements and independent accountants' reports thereon. NOTE 2 - CONTINGENCIES McDermott International, Inc. is contingently liable under standby letters of credit totaling $51,260,000 at December 31, 2000, all of which were issued in the normal course of business. McDermott International, Inc. has guaranteed the indebtedness of certain of its subsidiaries and other investees. At December 31, 2000, these guarantees included $5,811,000 of loans to and $123,400,000 of standby letters of credit issued by certain subsidiaries and other investees. At December 31, 2000, McDermott International, Inc. had pledged all of the fair value of its investments in debt securities to secure payments under and in connection with certain reinsurance agreements. NOTE 3 - DIVIDENDS RECEIVED McDermott International, Inc. received dividends from its consolidated subsidiaries of $487,562,000, $10,800,000 and $19,200,000 for the year ended December 31, 2000, the nine-month period ended December 31, 1999 and the fiscal year ended March 31, 1999, respectively. Also during the year ended December 31, 2000, McDermott International, Inc. received a capital contribution from one of its consolidated subsidiaries of $445,373,000. NOTE 4 - SUBSEQUENT EVENT On April 5, 2001, a group of insurance underwriters who have previously provided insurance to B&W under our excess liability policies filed (1) a declaratory judgement complaint against MII in the U.S. District Court for the Eastern District of Louisiana and (2) a declaratory judgment complaint against B&W in the U.S. Bankruptcy Court for the Eastern District of Louisiana. The insurance policies at issue in this litigation provide a significant portion of B&W's remaining excess liability coverage available for the resolution of the asbestos-related products liability claims that are the subject of the B&W Chapter 11 proceeding. The complaints contain substantially identical factual allegations. These include allegations that, in the course of settlement discussions with the representatives of the asbestos claimants in the B&W bankruptcy proceeding, MII and B&W breached the confidentiality provisions of an agreement they entered into with these insurers relating to insurance payments of the insurers as a result of asbestos claims. They also allege that MII and B&W have wrongfully attempted to expand the underwriters' obligations under that agreement and the applicable policies through the filing of a plan of reorganization in the B&W bankruptcy proceeding that contemplates the transfer of rights under that agreement and those policies to a trust that will manage the pending and future asbestos-related claims against B&W and certain of its affiliates. The complaints seek declarations that, among other things, the defendants are in material breach of the agreement with the 10 11 insurers and that the plaintiff underwriters owe no further obligations to MII and B&W under that agreement. With respect to the insurance policies, if the insurers should succeed in voiding the agreement, they seek to litigate issues under the policies in order to reduce their coverage obligations. The complaint in the District Court case also seeks a recovery of unspecified compensatory damages. Management believes these complaints and the substantive allegations they contain are without merit. Management intends to contest and defend against these actions vigorously. In management's opinion, these complaints will not have a material adverse effect on our consolidated financial position of results of operations. 11 12 SIGNATURE OF THE REGISTRANT Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this amendment to be signed on its behalf by the undersigned, thereunto duly authorized. McDERMOTT INTERNATIONAL, INC. /s/ Bruce F. Longaker ------------------------------------ By: Bruce F. Longaker Executive Vice President and Chief Financial Officer (Principal Financial Officer) April 23, 2001 12 13 EXHIBIT INDEX
EXHIBIT NUMBER DESCRIPTION ------- ----------- 99 Supplementary Financial Information on Panamanian Securities Regulations
13 14 EXHIBIT 99 McDERMOTT INTERNATIONAL, INC. ADDITIONAL EXHIBITS SUPPLEMENTARY FINANCIAL INFORMATION PREPARED IN ACCORDANCE WITH AND SOLELY FOR THE PURPOSE OF COMPLYING WITH CERTAIN PANAMANIAN SECURITIES REGULATIONS
Year Ended December 31, 2000 -------------- (Unaudited) (In thousands) ARTICLE 29 RULE #9 - INVESTMENTS IN SUBSIDIARIES AND OTHER INVESTEES AT EQUITY Head Office (Parent Company) $ 811,152 Subsidiaries and Affiliates -- Eliminations/Other (785,747) ------------ McDERMOTT INTERNATIONAL, INC $ 25,405 ============ RULE #25C - PARENT-COMPANY ACCOUNTS AND NOTES PAYABLE TO SUBSIDIARIES Head Office (Parent Company) $ 90,867 Eliminations/Other (90,867) ------------ McDERMOTT INTERNATIONAL, INC $ -- ============ ARTICLE 30 (c) - OPERATING EXPENSES BY SEGMENT Power Generation Systems $ 184,849 Marine Construction Services 791,042 Government Operations 391,452 Other Operations 493,277 Eliminations (4,545) ------------ McDERMOTT INTERNATIONAL, INC $ 1,856,075 ============ RULE #40 - OPERATING REVENUES Head Office (Parent Company) $ -- Subsidiaries and Affiliates 1,877,753 Eliminations/Other -- ------------ McDERMOTT INTERNATIONAL, INC $ 1,877,753 ============
14 15 Continued
Year Ended December 31, 2000 -------------- (Unaudited) (In thousands) ARTICLE 30 - Continued RULE #41 - OPERATING EXPENSES Head Office (Parent Company) $ 7,545 Subsidiaries and Affiliates 1,859,415 ------------ McDERMOTT INTERNATIONAL, INC $ 1,866,960 ============ RULE #43 - DIVIDENDS RECEIVED Head Office (Parent Company) from Subsidiaries and Affiliates $ 487,562 Subsidiaries and Affiliates from Other Corporations 14,109 Eliminations/Other (487,562) ------------ McDERMOTT INTERNATIONAL, INC $ 14,109 ============ RULE #44 - INTEREST INCOME Head Office (Parent Company): from Subsidiaries and Affiliates $ 584 from Other Corporations 2,227 Subsidiaries and Affiliates from Other Corporations 24,894 Eliminations (584) ------------ McDERMOTT INTERNATIONAL, INC $ 27,121 ============ RULE #46 - OTHER MISCELLANEOUS REVENUES Bad Debt Recoveries $ 3,533 Loss on Curtailment of Employee Benefit Plans (5,297) Other Items - Net 10,123 ------------ McDERMOTT INTERNATIONAL, INC $ 8,359 ============ RULE #51 - INVESTMENTS IN UNCONSOLIDATED AFFILIATES AT EQUITY Balance at December 31, 1999 $ 63,606 Equity Income (9,741) Dividends Received (14,109) Other Changes (14,351) ------------ Balance at December 31, 2000 $ 25,405 ============
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