-----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, VkKSS5rkC/e+R+b/umrAOxZFpAg1cERBe1hyfIRXgb/KnqACk3cIUO1LUzABn8Ks deCe6mR05G7Kt/zPqSz6Ew== 0001275287-06-001255.txt : 20060307 0001275287-06-001255.hdr.sgml : 20060307 20060307083604 ACCESSION NUMBER: 0001275287-06-001255 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20060306 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060307 DATE AS OF CHANGE: 20060307 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NEWPARK RESOURCES INC CENTRAL INDEX KEY: 0000071829 STANDARD INDUSTRIAL CLASSIFICATION: OIL & GAS FILED MACHINERY & EQUIPMENT [3533] IRS NUMBER: 721123385 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-02960 FILM NUMBER: 06668720 BUSINESS ADDRESS: STREET 1: 3850 N. CAUSEWAY BLVD STREET 2: SUITE 1770 CITY: METAIRIE STATE: LA ZIP: 70002 BUSINESS PHONE: 5048388222 MAIL ADDRESS: STREET 1: P O BOX 6411 STREET 2: II LAKEWAY CENTER STE 1770 FORMER COMPANY: FORMER CONFORMED NAME: NEW PARK MINING CO DATE OF NAME CHANGE: 19720828 8-K 1 nr5022.txt FORM 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): March 6, 2006 NEWPARK RESOURCES, INC. (Exact name of registrant as specified in its charter) Delaware 1-2960 72-1123385 (State or other jurisdiction (Commission (IRS Employer of incorporation) File Number) Identification No.) 3850 North Causeway, Suite 1770 Metairie, Louisiana 70002 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (504) 838-8222 ----------------------------------------------------------------- (Former name or former address, if changed since last report.) 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: [ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) [ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) [ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) [ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13a-4(c)) ================================================================================ ITEM 2.02. RESULTS OF OPERATIONS AND FINANCIAL CONDITION. On March 6, 2006, Newpark Resources, Inc. issued a press release announcing results for the year and quarter ended December 31, 2005. The press release is attached to this Form 8-K as Exhibit 99.1. The information in this Form 8-K and the exhibit attached hereto shall not be deemed "filed" for purposes of section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act") or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act regardless of any general incorporation by reference language in such filing. ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS. (d) Exhibits. 99.1 Press release issued by Newpark Resources, Inc. on March 6, 2006. SIGNATURES 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. NEWPARK RESOURCES, INC. Dated: March 6, 2006 By: /s/ Matthew W. Hardey ------------------------------------ Matthew W. Hardey, Vice President and Chief Financial Officer EXHIBIT INDEX EXHIBIT NO. DESCRIPTION - ----------- -------------------------------------------- 99.1 Press Release, dated as of March 6, 2006 EX-99.1 2 nr5022ex991.txt EXHIBIT 99.1 EXHIBIT 99.1 [LOGO OF NEWPARK RESOURCES, INC] - -------------------------------------------------------------------------------- 3850 NORTH CAUSEWAY BOULEVARD . SUITE 1770 . MATAIRE, LOUISIANA 70002-1752 . (504) 838-8222 . FAX (504) 833-9506 NEWPARK RESOURCES REPORTS FULL YEAR AND FOURTH QUARTER 2005 RESULTS o Total Revenues Increase 28.5% o Net Income Grows 440% Year over Year o Hurricanes Impact Earnings by $0.08 per Share METAIRIE, La, (PR Newswire)--Monday, March 6, 2006 - Newpark Resources, Inc. (NYSE: NR) today reported net income for the year ended December 31, 2005 of $21.6 million, or $0.25 per common share, on revenue of $557.0 million. This compares to 2004 net income of $4.0 million, or $0.05 per common share, on revenue of $433.4 million. For the fourth quarter of 2005, Newpark reported net income of $6.9 million or $0.08 per share, on revenue of $147.3 million. This compares to net income of $526,000 or $0.01 per share, on revenue of $113.7 million in the 2004 quarter. Amounts for 2004 include $4.2 million of non-cash charges, equal to $0.03 per share, affecting both the year and the fourth quarter results. The quarterly and annual net income reported are in line with analyst estimates and our 2005 guidance. Consolidated revenue and segment operating income gains in both the year and fourth quarter were driven by continued growth in the company's drilling fluids segment, which increased revenue by 42% during 2005 notwithstanding the impact in the third and fourth quarters of hurricanes in the Gulf of Mexico. James D. Cole, Newpark's Chief Executive Officer commented: "We believe that Hurricanes Katrina and Rita, which directly affected both the drilling fluids and E&P waste business, reduced reported revenue by more than $21.0 million, impacting reported earnings by approximately $0.08 per share. To date, Newpark has recovered approximately $8.3 million of its insured losses, including principally property damage and a portion of its business interruption claims related to Hurricanes Katrina and Rita. Determination of the additional amount of the business interruption claims has not yet been completed." DRILLING FLUIDS SEGMENT - ----------------------- Drilling fluids revenue for 2005 totaled $386.2 million, an increase of 42% from $272.9 million the prior year. Segment operating margin increased 90% to $41.4 million in 2005 compared to $21.8 million the prior year. This equates to a 10.7% operating margin in 2005, up from 8.0% in the year-ago period. NEWPARK RESOURCES, INC. - 4Q AND FY 2005 EARNINGS RELEASE ISSUED MARCH 6, 2006 - PAGE 1 OF 7 Fourth quarter 2005 revenue of $103.7 million increased 34.9% from $76.9 million in the year-ago period, the result of continued strong growth in markets outside of the storm-impacted Gulf Coast, as the number of rigs serviced by Newpark in the fourth quarter increased 25% compared to a year ago. Segment operating income rose by over 44% to $11.6 million, or 11.2% of revenue, compared to $8.1 million, equal to 10.5% of revenue, in the 2004 quarter. Cole commented, "Much of the fourth quarter revenue growth came from the unconventional gas markets in the Mid-Continent region made possible by advances in drilling and fracture stimulation technology. Newpark began to develop a position in these markets several years ago and has made considerable progress deploying the NewPhase(TM) product, a component of the company's high performance water-based product line, to create high performance fluid systems tailored to the drilling problems created by the reactive shale strata encountered in that market. With the continued development of shale plays in various U.S. basins, such as in the Mid Continent and the Rockies, we are optimistic about further market penetration for NewPhase(TM)." E&P WASTE SERVICES - ------------------ E&P waste segment revenue declined 5% to $61.3 million in 2005 compared to $64.5 million in 2004, the combined effect of adverse tropical weather and the focus of key personnel on the start-up of the new water treatment technology project. The Gulf Coast component of revenue suffered a volume decline from 3.2 million barrels in 2004 to 3.1 million in 2005 due to the late season storms. This was offset by a 10% increase in average revenue per barrel to $12.96 arising from favorable changes in mix. The segment operating contribution for 2005 was $6.4 million, equal to 10.4% of revenue, compared to $8.2 million, or 12.6% of revenue in 2004. Fourth quarter 2005 revenue totaled $16.4 million, substantially unchanged from $16.9 million in the final quarter of 2004. Segment operating profit of $2.8 million equaled 16.9% of revenue as compared to 14.8%, or $2.5 million, a year ago. Gulf Coast market waste volume in the fourth quarter rebounded sequentially to 803,000 from 683,000 barrels in the third quarter of 2005 as the company moved rapidly to reopen storm-damaged facilities and captured increased market share in the process. WATER TREATMENT TECHNOLOGY - -------------------------- Newpark is continuing work to commercialize a new proprietary water treatment technology, with current engineering efforts directed to improve the throughput capacity of the company's Boulder, Wyo. waste disposal site serving the Jonah and Pinedale fields in southwestern Wyoming, a very active North American natural gas market. In addition, Newpark has completed construction and is currently starting operation of its Gillette, Wyo. treatment facility which it will operate for a major independent gas producer in the coal seam methane market. NEWPARK RESOURCES, INC. - 4Q AND FY 2005 EARNINGS RELEASE ISSUED MARCH 6, 2006 - PAGE 2 OF 7 "Testing is slated to begin this month near Fort McMurray, Alberta, applying our water treatment technology to recycle contaminated water generated with production from oil sands in that area," said Cole. "We believe that there is additional value to be created by capturing the heat energy contained in the water and returning it to the operator, potentially reducing their energy consumption in the production process. Application of this proprietary technology to the waste water problems within the oil and gas industry could create a major new business opportunity for Newpark." MAT SALES AND MAT RENTALS - ------------------------- Mat segment revenue totaled $109.5 million for fiscal 2005, generating $11.1 million in operating contribution. This compares to $96.0 million in 2004 revenue, and $4.4 million in segment operating profit. The earnings improvement reflects, in part, operating cost reductions implemented during the year. "The mat segment was less directly impacted by the storms than drilling fluids and E&P waste, and suffered much less physical damage to facilities and equipment, " Cole explained. "However, we encountered numerous delays in the start-up of new projects as customers revised their priorities following the storms, and this held revenue below our expectations in the fourth quarter." Increased sales of wooden and composite mats accounted for $10.3 million of the revenue increase. Total site volume for 2005 was 13.5 million square feet at an average price of $1.08 per square foot, and compares to 15.9 million square feet in 2004 averaging $1.00 per square foot. Fourth quarter mat segment revenues totaled $27.2 million, compared to $19.9 million in the 2004 quarter. Mat sales contributed $8.8 million of the total segment revenue, and $6.2 million of the year-over-year revenue change, on the strength of increased units sold in both the DuraBase(TM) and Bravo(TM) product lines. Segment operating contribution improved from $182,000 in the 2004 quarter to $2.0 million in the recent period, principally from mat sales operations. Total mat rental installations in the quarter amounted to 3.6 million square feet, with average pricing at $0.98 per square foot. Cole commented: "As in the third quarter, fourth quarter operating results were impaired by the effects of severe tropical weather affecting our Gulf Coast rental market. We expect earnings from the segment to improve in 2006, led by an expected 25% increase in mat rental pricing and improved volume as market conditions return to normal, coupled with completion of our cost reduction program now fully in place. Finally, we anticipate that 2006 will demonstrate growth of non-oilfield rentals, principally to the utility industry, which declined in the second half of last year in the wake of tropical weather in the Gulf." NEWPARK RESOURCES, INC. - 4Q AND FY 2005 EARNINGS RELEASE ISSUED MARCH 6, 2006 - PAGE 3 OF 7 BALANCE SHEET DATA - ------------------ Newpark ended the year with $8.0 million in cash and borrowings of $32.7 million outstanding under its bank credit facility. Working capital increased by $19.0 million during the year, principally due to the need to carry increased levels of accounts receivable due to the increase in revenue during the period. Cash used for capital expenditures within the existing operating units totaled $18.3 million for the year, net of $4.7 million of financed additions and $1.5 million of asset sales. In addition, the Company invested $11.2 million implementing the new water treatment technology during the period. INVESTOR CONFERENCE CALL - ------------------------ Newpark will host a conference call at 10:00 AM EST, Tuesday, March 7. Investors may access the call by dialing 800-862-9098; the access code is Newpark. The call will be webcast live and can be accessed from the Investor Relations page of the Company's web site at "www. newpark.com." Newpark Resources, Inc. provides integrated fluids management, environmental and oilfield services to the exploration and production industry. THREE PAGES OF FINANCIAL DATA FOLLOW For further information contact: Matthew W. Hardey Vice President of Finance Newpark Resources, Inc. 3850 N. Causeway, Suite 1770 Metairie, Louisiana 70002 (504) 838-8222 The foregoing discussion contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. There are risks and uncertainties that could cause future events and results to differ materially from those anticipated by management in the forward-looking statements included in this press release. For further information regarding these and other factors, risks and uncertainties affecting Newpark, we refer you to the risk factors set forth in the Prospectus included in Newpark's Registration Statement on Form S-3 filed on May 8, 2002 (File No. 333-87840), to the section entitled "Forward Looking Statements" on page 17 of that Prospectus and to our periodic reports filed with the Securities and Exchange Commission, including our Report on Form 10-K for the year ended December 31, 2004. In particular, as described on page 9 of that Prospectus, any material decline in the level of oil and gas exploration and production activity could result in fewer opportunities being available for the service industry in general and Newpark in particular, and may adversely affect the demand for our services. In addition, as described on page 13 of that Prospectus, rescission or relaxation of governmental regulations, including in the discharge regulations recently implemented, could reduce the demand for Newpark's services and reduce Newpark's revenues and income. We strongly urge you to review these filings for a more detailed discussion of these risks and uncertainties. Newpark's SEC filings can be obtained at no charge at http://www.sec.gov , as well as through our website http://www.newpark.com . NEWPARK RESOURCES, INC. - 4Q AND FY 2005 EARNINGS RELEASE ISSUED MARCH 6, 2006 - PAGE 4 OF 7 NEWPARK RESOURCES, INC. FOURTH QUARTER COMPARISON (Unaudited) QUARTER ENDED DECEMBER 31, - --------------------------------------------- --------------------------- (In thousands, except per share data) 2005 2004 ------------ ------------ Segment revenues Fluids sales and engineering $ 103,668 $ 76,895 E&P waste disposal 16,439 16,858 Mat and integrated services 27,239 19,936 ------------ ------------ Total Segment Revenues 147,346 113,689 Segment operating income Fluids sales and engineering 11,578 8,059 E&P waste disposal 2,791 2,543 Mat and integrated services 1,958 182 ------------ ------------ Total Segment Operating Income 16,327 10,784 General and administrative expenses 2,357 2,391 Provision for uncollectible accounts (189) 800 Impairment of long-lived assets - 3,399 ------------ ------------ Operating income 14,159 4,194 Foreign currency exchange (gain) loss (178) (518) Interest and other (income) expense 92 (90) Interest expense 3,757 3,912 ------------ ------------ Income before income taxes 10,488 890 Provision for income taxes 3,562 139 ------------ ------------ Net income 6,926 751 Less: Preferred stock dividends - 225 ------------ ------------ Net income applicable to common shares $ 6,926 $ 526 ============ ============ Weighted average common shares outstanding (diluted) 88,966 84,194 ============ ============ Net income per common share (diluted) $ 0.08 $ 0.01 ============ ============ EBITDA Pretax income $ 10,488 $ 890 Depreciation and amortization 6,823 5,461 Interest expense 3,757 3,912 Other non-cash charges: Provision for uncollectible accounts (189) 800 Impairment of long-lived assets - 3,399 ------------ ------------ Total $ 20,879 $ 14,462 ============ ============ % of Revenue 14.2% 12.7% DRILLING FLUIDS DATA Average rigs - Newpark's domestic market 1,079 929 Average rigs serviced 210 175 Rig share 19.5% 18.8% Annualized revenue per rig (000's) $ 1,568 $ 1,441 WASTE DATA (in thousands, except per barrel amounts) Gulf Coast E&P waste volume (000's) 803 872 Gulf Coast average revenue per barrel $ 12.95 $ 11.59 Gulf Coast E&P revenue $ 10.4 $ 10.5 NORM 0.9 1.0 Industrial 0.7 0.9 ------------ ------------ Total Gulf Coast market 12.0 12.4 Non-Gulf Coast markets 4.4 4.5 ------------ ------------ Total revenue $ 16.4 $ 16.9 ============ ============ MAT RENTAL DATA - Gulf Coast (dollars in millions, except per square foot amounts) Installation $ 3.5 $ 3.6 Re-rental 1.4 2.0 ------------ ------------ Total U.S. oilfield mat rental $ 4.9 $ 5.6 Non-oilfield mat rental 0.7 1.7 Integrated services and other 12.8 10.5 Canadian operations 0.4 0.2 Composite mats 8.4 1.9 Total revenue $ 27.2 $ 19.9 Average price per square foot $ 0.98 $ 1.05 Square feet installed (MM) 3.6 3.4 NEWPARK RESOURCES, INC. - 4Q AND FY 2005 EARNINGS RELEASE ISSUED MARCH 6, 2006 - PAGE 5 OF 7 NEWPARK RESOURCES, INC. FISCAL YEAR COMPARISON (Unaudited) YEAR ENDED DECEMBER 31, - --------------------------------------------- --------------------------- (In thousands, except per share data) 2005 2004 ------------ ------------ Segment revenues Fluids sales and engineering $ 386,228 $ 272,937 E&P waste disposal 61,285 64,477 Mat and integrated services 109,525 96,008 ------------ ------------ Total Segment Revenues 557,038 433,422 Segment operating income Fluids sales and engineering 41,427 21,837 E&P waste disposal 6,350 8,156 Mat and integrated services 11,080 4,414 ------------ ------------ Total Segment Operating Income 58,857 34,407 General and administrative expenses 9,537 9,384 Provision for uncollectible accounts 843 800 Impairment of long-lived assets - 3,399 ------------ ------------ Operating income 48,477 20,824 Foreign currency exchange (gain) loss (521) (301) Interest and other (income) expense (158) (1,345) Interest expense 16,155 14,797 ------------ ------------ Income (loss) before income taxes 33,001 7,673 Provision for income taxes 10,862 2,717 ------------ ------------ Net income (loss) 22,139 4,956 Less: Preferred stock dividends and accretion 509 938 ------------ ------------ Net income (loss) applicable to common shares $ 21,630 $ 4,018 ============ ============ Weighted average common shares outstanding (diluted) 86,454 83,892 ============ ============ Net income (loss) per common share $ 0.25 $ 0.05 ============ ============ EBITDA Pretax income $ 33,001 $ 7,673 Depreciation and amortization 25,798 20,801 Interest expense 16,155 14,797 Other non-cash charges: Provision for uncollectible accounts 843 800 Impairment of long-lived assets - 3,399 ------------ ------------ Total $ 75,797 $ 47,470 ============ ============ % of Revenue 13.6% 11.0% DRILLING FLUIDS DATA Average rigs - Newpark's domestic market 1,029 899 Average rigs serviced 204 160 Rig share 19.8% 17.8% Annualized revenue per rig (000's) $ 1,537 $ 1,378 WASTE DATA (in thousands, except per barrel amounts) Gulf Coast E&P waste volume (000's) 3,070 3,226 Gulf Coast average revenue per barrel $ 12.96 $ 11.82 Gulf Coast E&P revenue $ 40.6 $ 39.8 NORM 3.5 3.2 Industrial 2.9 2.9 ------------ ------------ Total Gulf Coast market 47.0 45.9 Non-Gulf Coast markets 14.3 18.6 ------------ ------------ Total revenue $ 61.3 $ 64.5 MAT RENTAL DATA - Gulf Coast (dollars in millions, except per square foot amounts) Installation $ 14.6 $ 15.9 Re-rental 8.5 6.4 ------------ ------------ Total U.S. oilfield mat rental $ 23.1 $ 22.3 Non-oilfield mat rental 4.9 4.7 Integrated services and other 46.4 44.2 Canadian operations 9.9 5.1 Composite mats 25.2 19.7 Total revenue 109.5 96.0 Average price per square foot $ 1.08 $ 1.00 Square feet installed (MM) 13.5 15.9 NEWPARK RESOURCES, INC. - 4Q AND FY 2005 EARNINGS RELEASE ISSUED MARCH 6, 2006 - PAGE 6 OF 7 CONSOLIDATED BALANCE SHEETS (Unaudited) DECEMBER 31, DECEMBER 31, (In thousands) 2005 2004 ------------ ------------ ASSETS Current assets: Cash and cash equivalents $ 7,989 $ 7,022 Trade accounts receivable, less allowances 139,194 100,587 Notes and other receivables 12,623 7,321 Inventories 86,299 84,044 Deferred tax asset 16,231 12,501 Prepaid expenses and other current assets 13,448 13,275 ------------ ------------ Total current assets 275,784 224,750 Property, plant and equipment, net 239,774 210,514 Goodwill 116,841 117,414 Deferred tax asset - 4,063 Other intangible assets, net of accumulated amortization 18,199 15,355 Other assets 7,301 18,018 ------------ ------------ $ 657,899 $ 590,114 ============ ============ LIABILITIES AND STOCKHOLDERS' EQUITY Foreign bank lines of credit $ 10,890 $ 8,017 Current maturities of long-term debt 12,696 5,031 Accounts payable 42,984 38,822 Accrued liabilities 44,190 26,875 ------------ ------------ Total current liabilities 110,760 78,745 Long-term debt, less current portion 185,933 186,286 Deferred tax liability 8,031 - Other noncurrent liabilities 2,737 2,118 Preferred Stock - 20,000 Common Stock 884 840 Paid-in capital 428,393 402,248 Unearned restricted stock compensation (235) (472) Accumulated other comprehensive income 7,616 8,199 Retained deficit (86,220) (107,850) ------------ ------------ Total stockholders' equity 350,438 322,965 ------------ ------------ $ 657,899 $ 590,114 ============ ============ Ratio of long term debt to total capital 34.7% 36.6% ### NEWPARK RESOURCES, INC. - 4Q AND FY 2005 EARNINGS RELEASE ISSUED MARCH 6, 2006 - PAGE 7 OF 7 -----END PRIVACY-ENHANCED MESSAGE-----