-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: keymaster@town.hall.org Originator-Key-Asymmetric: MFkwCgYEVQgBAQICAgADSwAwSAJBALeWW4xDV4i7+b6+UyPn5RtObb1cJ7VkACDq pKb9/DClgTKIm08lCfoilvi9Wl4SODbR1+1waHhiGmeZO8OdgLUCAwEAAQ== MIC-Info: RSA-MD5,RSA, a1YLGdDCVMDVAs+p+y//4SwMxDJUSdDsHAWGPugszLOzejLYxg9XGtZNojXEnRYo JWFFuHvj2TfgdKsGrxVJkg== 0000899243-95-000268.txt : 19950517 0000899243-95-000268.hdr.sgml : 19950516 ACCESSION NUMBER: 0000899243-95-000268 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 19950331 FILED AS OF DATE: 19950512 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: OFFSHORE LOGISTICS INC CENTRAL INDEX KEY: 0000073887 STANDARD INDUSTRIAL CLASSIFICATION: AIR TRANSPORTATION, NONSCHEDULED [4522] IRS NUMBER: 720679819 STATE OF INCORPORATION: DE FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-05232 FILM NUMBER: 95537724 BUSINESS ADDRESS: STREET 1: 224 RUE DE JEAN STREET 2: PO BOX 5C CITY: LAFAYETTE STATE: LA ZIP: 70505 BUSINESS PHONE: 3182331221 MAIL ADDRESS: STREET 1: 224 RUE DE JEAN 70508 STREET 2: PO BOX 5C CITY: LAFAYETTE STATE: LA ZIP: 70505 10-Q 1 FORM 10-Q SECURITIES AND EXCHANGE COMMISSION WASHINGTON, DC 20549 FORM 10-Q [X] Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the quarterly period ended March 31, 1995 Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period to -------- -------- Commission File Number 0-5232 Offshore Logistics, Inc. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in its charter) Delaware 72-0679819 - ---------------------------------------- ------------------------------------ (State or other jurisdiction of (IRS Employer Identification Number) incorporation or organization) 224 Rue de Jean P. O. Box 5C, Lafayette, LA 70505 - ---------------------------------------- ------------------------------------ (Address of principal executive offices) (Zip Code) Registrants telephone number, including area code (318) 233-1221 ------------------------------ - -------------------------------------------------------------------------------- (Former name, former address and former fiscal year, if changed since last report) 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, and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No ------- ------- Indicate the number shares outstanding of each of the issuer's classes of Common Stock, as of March 31, 1995. 19,444,103 shares of Common Stock, $.01 par value - -------------------------------------------------------------------------------- OFFSHORE LOGISTICS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF INCOME (thousands of dollars, except per share amounts)
Three Months Ended Nine Months Ended March 31, March 31, ------------------ ----------------- 1995 1994 1995 1994 ---- ---- ---- ---- GROSS REVENUE Operating revenue $ 36,352 $ 23,134 $ 104,093 $ 67,797 Gain on disposal of equipment 162 2,660 341 3,005 ---------------------------------------------- 36,514 25,794 104,434 70,802 OPERATING EXPENSES Direct Cost 27,359 16,284 74,826 43,853 Depreciation and amortization 2,734 1,983 7,369 5,613 General and administration 2,859 1,601 7,479 5,051 ---------------------------------------------- 32,952 19,868 89,674 54,517 ---------------------------------------------- OPERATING INCOME 3,562 5,926 14,760 16,285 Earnings from unconsolidated entities 1,025 507 3,425 1,514 Interest income 727 430 2,035 1,335 Interest expense 205 258 650 876 ---------------------------------------------- INCOME BEFORE PROVISION FOR INCOME TAXES 5,109 6,605 19,570 18,258 Provision for income taxes 1,480 1,800 5,690 4,926 Minority interest in (income) loss of consolidated subsidiaries 251 _ 238 _ ---------------------------------------------- NET INCOME $ 3,880 $ 4,805 $ 14,118 $ 13,332 ============================================== Earnings per common share and common equivalent share $ 0.20 $ 0.27 $ 0.74 $ 0.74 ============================================== Common shares and common equivalent shares outstanding 19,722,682 17,996,805 19,187,309 18,001,811 ==============================================
2 OFFSHORE LOGISTICS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEET (thousands of dollars)
March 31, June 30, 1995 1994 -------------------- ASSETS CURRENT ASSETS: Cash and cash equivalents $ 38,812 $ 27,225 Investment in marketable securities 19,971 19,950 Accounts receivable 27,194 17,681 Inventories 26,298 21,907 Prepaid expenses 939 500 -------------------- Total current assets 113,214 87,263 Investments in unconsolidated entities 8,829 12,917 Property and equipment - at cost: Land and buildings 2,846 2,772 Aircraft and equipment 126,064 122,759 -------------------- 128,910 125,531 Less: accumulated depreciation and amortization (57,026) (51,614) -------------------- 71,884 73,917 Other assets, primarily goodwill 26,561 148 -------------------- $220,488 $174,245 ==================== LIABILITIES AND STOCKHOLDERS' INVESTMENT CURRENT LIABILITIES: Accounts payable $ 3,808 $ 1,957 Accrued liabilities 9,377 5,210 Current maturities of long-term debt 2,005 3,031 -------------------- Total current liabilities 15,190 10,198 Long-term debt - less current maturities 6,100 2,000 Deferred taxes 18,470 17,980 Deferred credits 625 2,500 Minority interest in consolidated subsidiaries 1,262 - STOCKHOLDERS' INVESTMENT: Common Stock, $.01 par value, authorized 35,000,000 shares; outstanding 19,444,103 and 17,602,379 at March 31 and June 30, respectively (exclusive of 517,550 treasury shares) 194 176 Paid in capital 94,701 71,563 Retained earnings 83,946 69,828 -------------------- 178,841 141,567 -------------------- $220,488 $174,245 ====================
3 OFFSHORE LOGISTICS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENT OF CASH FLOWS (thousands of dollars)
Nine Months Ended March 31, ----------------- 1995 1994 ---- ---- Cash flows from operating activities: Net income $ 14,118 $ 13,332 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 7,369 5,613 Increase in deferred taxes 490 2,282 Gain on asset dispositions (341) (3,005) Equity in earnings from unconsolidated entities (over) under dividends received (41) (13) Minority interest in earnings (238) - Decrease (Increase) in accounts receivable 3,459 (1,459) Increase in inventories (732) (2,196) Increase in prepaid expenses and other 47 (348) Increase in accounts payable 449 510 Increase (Decrease) in accrued liabilities (323) (1,108) Decrease in deferred credits (1,875) (1,520) -------- -------- Net cash provided by operating activities 22,382 12,088 -------- -------- Cash flows from investing activities: Capital expenditures (3,076) (10,956) Proceeds from asset dispositions 2,216 3,475 Additional advances to GPM _ (1,292) GPM acquisition costs, net of cash received (602) - Acquisition of CPS, net of cash received (7,629) - -------- -------- Net cash used in investing activities (9,091) (8,773) -------- -------- Cash flows from financing activities: Repayment of debt (3,730) (4,062) Issue common stock 2,026 401 -------- -------- Net cash used in financing activities (1,704) (3,661) Net increase (decrease) in cash 11,587 (346) Cash and cash equivalents at beginning of year 27,225 27,180 -------- -------- Cash and cash equivalents at end of quarter $ 38,812 $ 26,834 ======== ======== Supplemental disclosure of cash flow information Cash paid during the period for: Interest $ 611 $ 883 Income taxes 3,453 1,771
4 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS MARCH 31, 1995 NOTE A - BASIS OF PRESENTATION The accompanying unaudited consolidated financial statements have been prepared in accordance with the instructions to Form 10-Q and do not include all information and footnotes necessary for a fair presentation of financial position, results of operations, and cash flows in conformity with generally accepted accounting principles. In the opinion of management, any adjustments considered necessary for a fair presentation have been included. Operating results for the nine months ended March 31, 1995, are not necessarily indicative of the results that may be expected for the year ending June 30, 1995. For further information, refer to the consolidated financial statements and footnotes included in the Company's Annual Report on Form 10-K for the year ended June 30, 1994. NOTE B - PRODUCTION MANAGEMENT SERVICES The Company expanded its operations in July 1992 to include production management services. During fiscal 1993 and until October 29, 1993, the Company owned 50% of PPI-Seahawk Services, Inc. ("Seahawk"), a company which provided platform and production management services, offshore medical support services, and temporary personnel to the oil and gas industry. On October 29, 1993, the Company further expanded its interest in production management services by Seahawk merging into Grasso Corporation ("Grasso"). The Company exchanged its 50% investment in Seahawk for a 27.5% interest in Grasso. On September 16, 1994, the Company acquired the remaining 72.5% interest in Grasso by issuing .49 of a share of the Company's common stock for each share of Grasso common stock owned. In addition, holders of Grasso Class B warrants are entitled to receive similar warrants for shares of the Company's common stock. The Merger was treated as a purchase for accounting purposes which resulted in goodwill of approximately $22.6 million after stepping up the assets and liabilities of Grasso. The goodwill will be amortized over a 20 year period. The following summarized income statement data reflects the impact the Grasso merger would have had on the Company's results of operations had the transactions taken place on July 1, 1993:
Proforma Results for the Nine Months Ended March 31, ------------------------ 1995 1994 -------- ------- Gross revenue $113,069 $98,427 ======== ======= Net income $ 13,646 $11,869 ======== ======= Earnings per common share and common equivalent share $ .69 $ .61 ======== =======
5 NOTE C - CATHODIC PROTECTION SERVICES In October 1994, the Company acquired 75% of Cathodic Protection Services Company ("CPS") for $7.5 million. CPS manufactures, installs and maintains cathodic protection systems to arrest corrosion in oil and gas drilling and production facilities, pipelines, oil and gas well casings, hydrocarbon processing plants, and other metal structures. The acquisition was treated as a purchase for accounting purposes which resulted in goodwill of approximately $3.6 million. The goodwill will be amortized over a 20 year period. The proforma effect of this acquisition as though it had been acquired at the beginning of each of the periods presented is not material to the operating results of the Company. 6 MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS A summary of operating results for the applicable periods is as follows:
Three Months Ended Nine Months Ended March 31, March 31, ------------------ ------------------- 1995 1994 1995 1994 ---- ---- ---- ---- Gross revenue $ 36,514 $ 25,794 $104,434 $ 70,802 Operating expenses 32,952 19,868 89,674 54,517 ----------------------------------------- Operating income 3,562 5,926 14,760 16,285 Earnings from unconsolidated entities 1,025 507 3,425 1,514 Interest income 727 430 2,035 1,335 Interest expense 205 258 650 876 ----------------------------------------- Income before provision for income taxes 5,109 6,605 19,570 18,258 Provision for income taxes 1,480 1,800 5,690 4,926 Minority interest in (income) loss of consolidated subsidiaries 251 - 238 - ----------------------------------------- Net income $ 3,880 $ 4,805 $ 14,118 $ 13,332 =========================================
7 RESULTS OF OPERATIONS CONSOLIDATED Consolidated revenues for the three months and nine months ended March 31, 1995 were $36.5 million and $104.4 million, respectively. This represents over a 40% increase from prior year operating revenues of $25.8 million and $70.8 million, respectively, primarily attributable to the consolidation of GPM and CPS. Prior year revenues included $2.7 million of non-recurring gains on disposal of equipment. Consolidated operating expenses for the three months and nine months ended March 31, 1995 were $33.0 million and $89.7 million, respectively. Prior year operating expenses were $19.9 million and $54.5 million, respectively AIR DIVISION Flight hours during the three months ended March 31, 1995 were approximately 25,500, a 10% decrease compared to the same period in the prior year. Nine month flight hours were approximately 85,400, basically even compared to the prior year. The 10% decrease in flight hours for the three months ended March 31, 1995 is primarily due to a reduction in Alaska and International operations. Gulf of Mexico operations were stable compared with prior year. Operating revenues for the Air Division were $20.8 million and $68.5 million for the three months and nine months ended March 31, 1995, a 10% decrease and a 1% increase compared to the prior year. Operating expenses for the Air Division were $16.0 million and $50.8 million for the three and nine months ended March 31, 1995, respectively, a 15% and 2% decrease from the prior year. Gross margins (excluding gains on disposals) for the Air Division were 24% and 26% for the three and nine months ended March 31, 1995, respectively. GPM GPM, the Company's production management services subsidiary, acquired on September 16, 1994, generated $10.4 million and $23.2 million in operating revenues included in the three and nine months ended March 31, 1995, respectively. Operating expenses from GPM were $10.4 and $23.0 million included in the three and nine months ended March 31, 1995, respectively. Gross margins were at a break even basis during this period. CPS CPS, the Company's 75% owned cathodic protection corrosion control company, was acquired in October, 1994. Operating revenues included in the three and nine months ended March 31, 1995 were $6.3 million and $15.5 million, respectively. Operating expenses included in the three and nine months ended March 31, 1995 were $7.2 million and $16.2 million, respectively. A seasonal downturn in activity at CPS during the current quarter resulted in a negative operating contribution. LIQUIDITY AND CAPITAL RESOURCES Cash and cash equivalents (including marketable securities) were $58.8 million as of March 31, 1995, a $11.6 million increase from fiscal year end 1994. Total debt was $8.1 million as of March 31, 1995. 8 As of March 31, 1995, the Company had $10 million of credit available under an unsecured working capital line of credit from a bank. Management believes that normal operations will provide sufficient working capital and cash flow to meet debt service for the foreseeable future. The effective income tax rates from continuing operations were 29% and 27% for the nine months ended March 31, 1995 and 1994, respectively, and is based on the Company's projected effective tax rate for the fiscal year then ended. The increase in the effective tax rate is due primarily to amortization of goodwill related to GPM acquisition, which is not deductible for tax purposes. The Company has received notices from the United States Environmental Protection Agency that it is one of approximately 160 potentially responsible parties ("PRP") at one Superfund site in Texas, one of over 300 PRPs at two sites in Louisiana, and a PRP at a site in Rhode Island. The Company believes, based on presently available information, that its potential liability for clean-up and other response costs in connection with these sites is not likely to have a material adverse effect on the Company's business or financial condition. 9 PART II Item 6. Exhibits and Reports on Form 8-K - ------- -------------------------------- (a) Listed below are the documents filed as exhibits to this report. Exhibit 11 Computation of Earnings Per Share (b) No reports on Form 8-K were filed during the quarter ended March 31, 1995. 10 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 thereunto duly authorized. OFFSHORE LOGISTICS, INC. BY: /s/ James B. Clement ------------------------------ JAMES B. CLEMENT President Chief Executive Officer DATE: May 12, 1995 BY: /s/ George M. Small ------------------------------ GEORGE M. SMALL Vice President Chief Financial Officer DATE: May 12, 1995 11 EX-11 2 COMPUTATION OF EARNINGS EXHIBIT 11 COMPUTATION OF EARNINGS PER SHARE
Three Months Ended Nine Months Ended March 31, March 31, ------------------ ----------------- 1995 1994 1995 1994 ---- ---- ---- ---- PRIMARY: Weighted average shares outstanding 19,417,742 17,600,957 18,855,639 17,584,180 Net effect of dilutive stock warrants based on the Treasury Stock method using average market price 17,162 84,887 40,947 89,849 Net effect of dilutive stock options based on the Treasury Stock method using average market price 287,778 310,961 290,723 327,782 ---------------------------------------------- 19,722,682 17,996,805 19,187,309 18,001,811 ============================================== FULLY DILUTED: Weighted average shares outstanding 19,417,742 17,600,957 18,855,639 17,584,180 Net effect of dilutive stock warrants based on the Treasury Stock method using end of period market price 18,021 84,887 42,662 95,143 Net effect of dilutive stock options based on the Treasury Stock method using end of period market price 292,524 310,961 297,157 341,563 ---------------------------------------------- 19,728,287 17,996,805 19,195,458 18,020,886 ============================================== (thousands of dollars, except per share data) Net income $ 3,880 $ 4,805 $ 14,118 $ 13,332 ============================================== Per share amount - Primary $ 0.20 $ 0.27 $ 0.74 $ 0.74 ============================================== Per share amount - Fully diluted $ 0.20 $ 0.27 $ 0.74 $ 0.74 ==============================================
EX-27 3 FINANCIAL DATA SCHEDULE
5 1,000 9-MOS JUN-30-1995 JUL-01-1994 MAR-31-1995 38,812 19,971 27,194 0 26,298 113,214 128,910 57,026 220,488 15,190 6,100 194 0 0 178,647 220,488 104,093 104,434 74,826 89,674 0 0 650 19,570 5,690 14,118 0 0 0 14,118 .74 .74
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