EX-99 2 h22281exv99.txt PRESS RELEASE DATED FEBRUARY 8, 2005 FOR IMMEDIATE RELEASE Investor Contact: David Tucker 281-406-2370 Media Contact: Marianne Gooch 281-406-2212 Parker Drilling Reports Fourth Quarter Results Houston, February 8, 2005 - Parker Drilling Company (NYSE: PKD) today reported fourth quarter revenues of $109.8 million and a net loss of $5.3 million or $0.06 per share, compared to a net loss of $12.4 million or $0.13 per share, on revenues of $91.6 million for the fourth quarter of 2003. The fourth quarter loss from continuing operations was $2.2 million, or $0.03 per share, compared to a loss of $15.2 million, or $0.16 per share, for the fourth quarter a year ago. The fourth quarter of 2004 included a number of non-routine items which negatively impacted earnings by $8.3 million or $0.09 per share, of which $4.2 million, or $0.05 per share, was attributable to continuing operations. Absent the $4.2 million of non-routine items, income from continuing operations would have been a positive $2.0 million, or $0.02 per share. The $4.2 million of non-routine items for continuing operations includes a $6.5 million provision primarily related to reduction in the carrying value of four international land rigs and two U.S. barge rigs partially offset by a $2.3 million gain on disposition of assets primarily related to barge rig 74 in Nigeria. Discontinued operations reflect a $4.1 million loss on jackup rig 25 which was sold in January 2005. Excluding this loss, results from discontinued operations would have reflected income of $1.0 million, or $0.01 per share. (See attached reconciliation, non- routine items) For 2004, Parker Drilling reported revenues of $376.5 million and a net loss of $47.1 million, or $0.50 per share. This compares to revenues of $338.7 million and a net loss of $109.7 million, or $1.17 per share, for 2003 which included an impairment for assets held for sale of $54.0 million, or $0.58 per share. The loss from continuing operations for 2004 was $50.6 million, or $0.54 per share compared to a loss from continuing operations of $52.4 million, or $0.56 per share, for 2003. Excluding non-routine items, the Company's 2004 loss would have been $18.2 million, or $0.20 per share. Non-routine items in 2004 reduced earnings $28.9 million, or $0.30 per share, including $24.8 million, or $0.26 per share, attributable to continuing operations and $4.1 million, or $0.04 per share, attributable to discontinued operations. The non-routine items include: $8.3 million in the fourth quarter detailed above; an $8.2 million loss from extinguishing $80 million of 10.125% Senior Notes and $70 million of a Term Loan with proceeds from issuing $150 million of Senior Floating Rate Notes; $6.6 million provision for reduction in carrying value of certain assets, which includes reclassifying Latin American operations from discontinued to continuing operations and an adjustment to a life insurance policy; $2.3 million for an additional value added tax assessment in Nigeria; $2.1 million for taxes assessed by the Mangistau Customs Control in connection with the temporary import status of barge rig 257 in the Caspian Sea and $1.4 million relating to severance costs. (See attached reconciliation, non-routine items) Fourth quarter average rig utilization, before and after the reduction of seven rigs to the marketable rig count, is reflected in the following table:
Utilization After Reduction Utilization Before Reduction ------------------------------------- --------------------------------------- 2004 2004 ------------------------------------- --------------------------------------- Marketable 4th 3rd Marketable 4th 3rd Rigs Qtr. Qtr. Current Rigs Qtr. Qtr. Current ---------- ---- ---- ------- ---------- ---- ---- ------- International Land 38 58% 54% 61% 34 65% 61% 68% International Offshore 6 45% 33% 67% 5 54% 40% 80% Gulf of Mexico 20 71% 66% 70% 18 79% 74% 78% ---------- ---------- TOTAL 64 61% 56% 64% 57 68% 63% 72% ========== ==========
"Parker Drilling finished a year of transition with the best quarter for operations since 2001," said Robert L. Parker, Jr., president and chief executive officer. "With $135 million of debt paid down including $25 million yesterday, a strong new chief operating officer in Dave Mannon and current utilization of our existing rigs at 72%, Parker is well positioned to be profitable in 2005." Capital expenditures in 2004 totaled $47.3 million. Debt totaled $481.1 million at December 31, 2004, and the Company's cash balance was $44.3 million. Parker Drilling reaffirms its previously released guidance of net income per share of $0.05 to $0.14 for 2005. Parker has scheduled a conference call at 10 a.m. CST (11 a.m. EST) February 8, 2005 to discuss fourth quarter 2004 results. Those interested in participating in the call may dial in at (303) 262-2130. The conference call replay can be accessed from noon CST February 8, 2005 through February 15, 2005, by dialing (303) 590-3000 and using the access code 11021350#. Alternatively, the call can be accessed live through the Parker Web site at http://www.parkerdrilling.com. The archived call will be available on the Web site for 12 months. ### This release contains certain statements that may be deemed to be "forward-looking statements" within the meaning of the Securities Acts. All statements, other than statements of historical facts, that address activities, events or developments that the Company expects, projects, believes or anticipates will or may occur in the future, including the outlook for rig utilization and dayrates, general industry conditions including bidding activity, future operating results of the Company's rigs and rental tool operations, capital expenditures, expansion and growth opportunities, asset sales and other such matters, are forward-looking statements. Although the Company believes that its expectations stated in this release are based on reasonable assumptions, actual results may differ materially from those expressed or implied in the forward-looking statements. For a more detailed discussion of risk factors, please refer to the Company's reports filed with the SEC, and in particular, the report on Form 10-K for the year ended December 31, 2003. Each forward-looking statement speaks only as of the date of this release, and the Company undertakes no obligation to publicly update or revise any forward-looking statement. PARKER DRILLING COMPANY AND SUBSIDIARIES Consolidated Condensed Statements of Operations (Unaudited)
Three Months Ended December 31, Twelve Months Ended December 31, ------------------------------- -------------------------------- 2004 2003 2004 2003 ------------- -------------- -------------- --------------- (Dollars in Thousands) DRILLING AND RENTAL REVENUES U.S. Drilling $ 25,303 $ 17,856 $ 88,512 $ 67,449 International Drilling 64,608 59,473 220,846 216,567 Rental Tools 19,889 14,271 67,167 54,637 ------------- ------------- ------------- ------------- TOTAL DRILLING AND RENTAL REVENUES 109,800 91,600 376,525 338,653 ------------- ------------- ------------- ------------- DRILLING AND RENTAL OPERATING EXPENSES U.S. Drilling 15,530 10,274 54,126 47,740 International Drilling 46,233 40,803 168,451 152,201 Rental Tools 8,154 6,183 28,037 23,051 Depreciation and Amortization 18,642 17,099 69,241 73,679 ------------- ------------- ------------- ------------- TOTAL DRILLING AND RENTAL OPERATING EXPENSES 88,559 74,359 319,855 296,671 ------------- ------------- ------------- ------------- DRILLING AND RENTAL OPERATING INCOME 21,241 17,241 56,670 41,982 ------------- ------------- ------------- ------------- Construction Contract Revenue - - - 7,030 Construction Contract Expense - - - 5,030 ------------- ------------- ------------- ------------- NET CONSTRUCTION CONTRACT OPERATING INCOME - - - 2,000 ------------- ------------- ------------- ------------- General and Administrative Expense (5,455) (4,771) (23,413) (19,256) Provision for Reduction in Carrying Value of Certain Assets (6,562) (6,028) (13,120) (6,028) Gain on Disposition of Assets, Net 2,328 2,885 3,730 4,229 ------------- ------------- ------------- ------------- TOTAL OPERATING INCOME 11,552 9,327 23,867 22,927 ------------- ------------- ------------- ------------- OTHER INCOME AND (EXPENSE) Interest Expense (11,291) (13,889) (50,368) (53,790) Change in Fair Value of Derivative Position 586 - (794) - Loss on Extinguishment of Debt (24) (5,274) (8,753) (5,274) Other Income (Expense) - Net 31 (15) 492 688 ------------- ------------- ------------- ------------- TOTAL OTHER INCOME AND (EXPENSE) (10,698) (19,178) (59,423) (58,376) ------------- ------------- ------------- ------------- INCOME (LOSS) BEFORE INCOME TAXES 854 (9,851) (35,556) (35,449) Income Tax Expense 3,001 5,317 15,009 16,985 ------------- ------------- ------------- ------------- LOSS FROM CONTINUING OPERATIONS (2,147) (15,168) (50,565) (52,434) Discontinued Operations, Net of Taxes (3,104) 2,734 3,482 (57,265) ------------- ------------- ------------- ------------- NET LOSS $ (5,251) $ (12,434) $ (47,083) $ (109,699) ============== ============= ============= ============= EARNINGS (LOSS) PER SHARE - BASIC AND DILUTED Loss From Continuing Operations $ (0.03) $ (0.16) $ (0.54) $ (0.56) Discontinued Operations, Net of Taxes $ (0.03) $ 0.03 $ 0.04 $ (0.61) Net Loss $ (0.06) $ (0.13) $ (0.50) $ (1.17) AVERAGE COMMON SHARES OUTSTANDING Basic and Diluted 94,615,448 94,079,159 94,113,257 93,420,713
PARKER DRILLING COMPANY AND SUBSIDIARIES Consolidated Condensed Balance Sheets (Unaudited)
December 31, 2004 December 31, 2003 ------------------- ------------------- ASSETS (Dollars in Thousands) CURRENT ASSETS Cash and Cash Equivalents $ 44,267 $ 67,765 Accounts and Notes Receivable, Net 99,315 89,050 Rig Materials and Supplies 19,206 13,627 Other Current Assets 19,470 2,466 ------------------- ------------------- TOTAL CURRENT ASSETS 182,258 172,908 ------------------- ------------------- PROPERTY, PLANT AND EQUIPMENT, NET 382,824 387,664 ASSETS HELD FOR SALE 23,665 150,370 OTHER ASSETS Goodwill 107,606 114,398 Other Assets 26,343 22,292 ------------------- ------------------- TOTAL OTHER ASSETS 133,949 136,690 ------------------- ------------------- TOTAL ASSETS $ 722,696 $ 847,632 =================== =================== LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES Current Portion of Long-Term Debt $ 24 $ 60,225 Accounts Payable and Accrued Liabilities 87,329 68,404 ------------------- ------------------- TOTAL CURRENT LIABILITIES 87,353 128,629 ------------------- ------------------- LONG-TERM DEBT 481,039 511,400 DISCONTINUED OPERATIONS - 6,421 OTHER LIABILITIES 5,387 8,379 STOCKHOLDERS' EQUITY 148,917 192,803 ------------------- ------------------- TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 722,696 $ 847,632 =================== =================== Current Ratio 2.09 1.34 Total Long Term Debt as a Percent of Capitalization 76% 73% Book Value Per Common Share $ 1.57 $ 2.05
PARKER DRILLING COMPANY AND SUBSIDIARIES Selected Financial Data (Unaudited)
Three Months Ended --------------------------------------------------- December 31, September 30, ------------------------------- ------------- 2004 2003 2004 ------------ ------------ ------------ DRILLING AND RENTAL REVENUES (Dollars in Thousands) U.S. Drilling $ 25,303 $ 17,856 $ 22,788 International Land Drilling 56,502 41,417 45,918 International Offshore Drilling 8,106 18,056 3,768 Rental Tools 19,889 14,271 15,471 ------------ ------------ ------------ Total Drilling and Rental Revenues 109,800 91,600 87,945 ------------ ------------ ------------ DRILLING AND RENTAL OPERATING EXPENSES U.S. Drilling 15,530 10,274 13,399 International Land Drilling 40,727 29,172 33,553 International Offshore Drilling 5,506 11,631 10,271 Rental Tools 8,154 6,183 6,558 ------------ ------------ ------------ Drilling and Rental Operating Expenses 69,917 57,260 63,781 ------------ ------------ ------------ DRILLING AND RENTAL OPERATING INCOME U.S. Drilling 9,773 7,582 9,389 International Land Drilling 15,775 12,245 12,365 International Offshore Drilling 2,600 6,425 (6,503) Rental Tools 11,735 8,088 8,913 Depreciation and Amortization (18,642) (17,099) (17,806) ------------ ------------ ------------ Total Drilling and Rental Operating Income 21,241 17,241 6,358 General and Administrative Expense (5,455) (4,771) (4,924) Provision for Reduction in Carrying Value of Certain Assets (6,562) (6,028) -- Gain on Disposition of Assets, Net 2,328 2,885 333 ------------ ------------ ------------ TOTAL OPERATING INCOME $ 11,552 $ 9,327 $ 1,767 ============ ============ ============
Marketable Rig Count Summary As of January 31, 2005
Total ------------ U.S. Gulf of Mexico Barge Rigs Workover 6 Intermediate 4 Deep 8 ------------ Total U.S. Gulf of Mexico Barge Rigs 18 ------------ International Land Rigs Asia Pacific 10 Africa/Middle East 2 Latin America 14 CIS 8 ------------ Total International Land Rigs 34 International Barge Rigs Mexico 1 Nigeria 3 Caspian Sea 1 ------------ Total International Barge Rigs 5 ------------ Total International Rigs 39 ------------ ------------ Total Marketable Rigs 57 ===========
PARKER DRILLING COMPANY AND SUBSIDIARIES Reconciliation, Non-Routine Items (Unaudited)
Three Months Ended ----------------------------------------------- December 31, 2004 ----------------------------------------------- (Dollars in Millions, Except Per Share Amounts) Loss From Continuing Operations, as Reported $ (2.2) $ (0.03) ------------ ------------ Non-Routine Items: Provision for Reduction in Carrying Value of Certain Assets 6.5 0.07 Gain on Disposition of Assets, Net (2.3) (0.02) ------------ ------------ Total Fourth Quarter Non-Routine Items 4.2 0.05 ------------ ------------ Income From Continuing Operations, Excluding Non-Routine Items $ 2.0 $ 0.02 ============ ============ Discontinued Operations, as Reported $ (3.1) $ (0.03) Non-Routine Item: Loss on Disposition of Asset 4.1 0.04 ------------ ------------ Discontinued Operations, Excluding Non-Routine Item $ 1.0 $ 0.01 ============ ============ Net Loss, as Reported $ (5.3) $ (0.06) Total Non-Routine Items 8.3 0.09 ------------ ------------ Net Income, Excluding Non-Routine Items $ 3.0 $ 0.03 ============ ============
Twelve Months Ended ----------------------------------------------- December 31, 2004 ----------------------------------------------- (Dollars in Millions, Except Per Share Amounts) Loss From Continuing Operations, as Reported $ (50.6) $ (0.54) ------------ ------------ Non-Routine Items: Provision for Reduction in Carrying Value of Certain Assets 13.1 0.14 Gain on Disposition of Assets, Net (2.3) (0.02) Extinguishment Costs Related to Debt Refinancing 8.2 0.09 Value Added Tax Assessment - Nigeria 2.3 0.02 Taxes Assessed for Temporary Import Status - Caspian Sea 2.1 0.02 Severance Costs 1.4 0.01 ------------ ------------ Total 2004 Non-Routine Items 24.8 0.26 ------------ ------------ Loss From Continuing Operations, Excluding Non-Routine Items $ (25.8) $ (0.28) ============ ============ Discontinued Operations, as Reported $ 3.5 $ 0.04 Non-Routine Item: Loss on Disposition of Asset 4.1 0.04 ------------ ------------ Discontinued Operations, Excluding Non-Routine Item $ 7.6 $ 0.08 ============ ============ Net Loss, as Reported $ (47.1) $ (0.50) Total Non-Routine Items 28.9 0.30 ------------ ------------ Net Loss, Excluding Non-Routine Items $ (18.2) $ (0.20) ============ ============