-----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, EGONFCrsSSxbF6YFT3EdA51ak/MMgukjAsPWcptA9L4aHrxKN975bgQZCL29BTjD 4myirpx3lkyt6JifoeXb3Q== 0000008411-00-000005.txt : 20000214 0000008411-00-000005.hdr.sgml : 20000214 ACCESSION NUMBER: 0000008411-00-000005 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19991231 FILED AS OF DATE: 20000211 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ATWOOD OCEANICS INC CENTRAL INDEX KEY: 0000008411 STANDARD INDUSTRIAL CLASSIFICATION: DRILLING OIL & GAS WELLS [1381] IRS NUMBER: 741611874 STATE OF INCORPORATION: TX FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10-Q SEC ACT: SEC FILE NUMBER: 001-13167 FILM NUMBER: 534019 BUSINESS ADDRESS: STREET 1: 15835 PARK TEN PL DR STREET 2: SUITE 200 CITY: HOUSTON STATE: TX ZIP: 77084 BUSINESS PHONE: 2817497845 MAIL ADDRESS: STREET 1: 15835 PARK TEN PL DR STREET 2: SUITE 200 CITY: HOUSTON STATE: TX ZIP: 77084 10-Q 1 - -------------------------------------------------------------------------------- SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 ---------------- Form 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR QUARTERLY PERIOD ENDED DECEMBER 31, 1999 COMMISSION FILE NUMBER 1-13167 ATWOOD OCEANICS, INC. (Exact name of registrant as specified in its charter) TEXAS 74-1611874 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 15835 Park Ten Place Drive 77084 Houston, Texas (Zip Code) (Address of principal executive offices) Registrant's telephone number, including area code: 281-492-2929 --------------- Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 15 or 15 (d) of the Securities Exchange Act of 1934 during the preceding 12 months and (2) has been subject to such filings requirements for the past 90 days. Yes X No___ Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of December 31, 1999 13,677,701 shares of Common Stock $1 par value - ------------------------------------------------------------------------------ PART I. FINANCIAL INFORMATION ATWOOD OCEANICS, INC. AND SUBSIDIARIES The condensed consolidated financial statements herein have been prepared by the Company pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial reporting. Accordingly, these financial statements and related information have been prepared without audit and certain information and disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted, although management believes that the disclosures are adequate to make the information not misleading. The condensed consolidated financial statements reflect all adjustments which are, in the opinion of management, necessary to present fairly the financial position of the Company as of December 31, 1999 and September 30, 1999, and the results of its operations and cash flows for the three months ended December 31, 1999 and 1998, respectively. All adjustments were of a normal recurring nature. The interim financial results may not be indicative of results that could be expected for a full year. It is suggested these condensed consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Company's September 30, 1999 Annual Report to Shareholders. PART I. ITEM I - FINANCIAL STATEMENTS ATWOOD OCEANICS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In Thousands) December 31, September 30, 1999 1999 ------------ ------------- ASSETS CURRENT ASSETS: Cash and cash equivalents $ 16,948 $ 20,105 Accounts receivable 31,486 18,289 Inventories of materials and supplies, at lower of average cost or market 7,892 8,010 Deferred tax assets 720 720 Prepaid expenses 2,099 3,408 -------- -------- Total Current Assets 59,145 50,532 -------- -------- SECURITIES HELD FOR INVESTMENT: Held-to-maturity, at amortized cost 22,590 22,589 Available-for-sale, at fair value 325 347 -------- -------- 22,915 22,936 -------- -------- PROPERTY AND EQUIPMENT, at cost: Drilling vessels, equipment and drill pipe 369,706 358,372 Other 7,622 7,317 -------- -------- 377,328 365,689 Less-accumulated depreciation 152,879 146,775 -------- -------- Net Property and Equipment 224,449 218,914 -------- -------- DEFERRED COSTS AND OTHER ASSETS 1,187 1,222 -------- -------- $307,696 $293,604 ======== ======== The accompanying notes are an integral part of these consolidated financial statements. PART I. ITEM I - FINANCIAL STATEMENTS ATWOOD OCEANICS, INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (In Thousands) December 31, September 30, 1999 1999 ------------ ------------- (Unaudited) LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 4,561 $ 7,640 Accrued liabilities 11,118 11,373 -------- -------- Total Current Liabilities 15,679 19,013 -------- -------- LONG-TERM DEBT, net of current maturities: 57,000 54,000 -------- -------- DEFERRED CREDITS: Income taxes 8,660 8,168 Other 29,053 20,194 -------- -------- 37,713 28,362 -------- -------- SHAREHOLDERS' EQUITY: Preferred stock, no par value; 1,000,000 shares authorized, none outstanding --- --- Common stock, $1 par value; 20,000,000 shares authorized with 13, 678,000 and 13,675,000 shares issued and outstanding at December 31, 1999 and September 30, 1999, respectively 13,678 13,675 Paid-in capital 52,492 52,458 Accumulated other comprehensive income (loss) (154) (139) Retained earnings 131,288 126,235 -------- -------- 197,304 192,229 -------- -------- $307,696 $293,604 ======== ======== The accompanying notes are an integral part of these consolidated financial statements. PART I. ITEM I - FINANCIAL STATEMENTS ATWOOD OCEANICS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands except per share amounts) Three Months Ended December 31, 1999 1998 ----------- ---------- (Unaudited) REVENUES: Contract drilling $ 30,661 $ 34,252 Contract management 523 725 -------- -------- 31,184 34,977 -------- -------- COSTS AND EXPENSES: Contract drilling 13,966 15,911 Contract management 389 723 Depreciation 6,144 5,327 General and administrative 2,000 2,190 -------- -------- 22,499 24,151 -------- -------- OPERATING INCOME 8,685 10,826 -------- -------- OTHER INCOME (EXPENSE): Interest expense (954) (824) Interest income 537 586 -------- -------- (417) (238) -------- -------- INCOME BEFORE INCOME TAXES 8,268 10,588 PROVISION FOR INCOME TAXES 3,215 3,812 -------- -------- NET INCOME $ 5,053 $ 6,776 ======== ======== EARNINGS PER SHARE: Basic $ .37 $ .50 Diluted $ .36 $ .49 AVERAGE COMMON SHARES OUTSTANDING: Basic 13,676 13,625 Diluted 13,859 13,755 The accompanying notes are an integral part of these consolidated financial statements. . PART I. ITEM I - FINANCIAL STATEMENTS ATWOOD OCEANICS, INC. AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (In Thousands)
Three Months Ended December 31, ------------------------------- 1999 1998 ------- ------- (Unaudited) CASH FLOW FROM OPERATING ACTIVITIES: Net Income $ 5,053 $ 6,776 ------- ------- Adjustments to reconcile net income to net cash provided (used) by operating activities: Depreciation 6,144 5,327 Amortization 214 124 Deferred federal income tax provision 499 --- Changes in assets and liabilities: Increase in accounts receivable (13,197) (2,906) Increase (decrease) in accounts payable and accrued liabilities (2,794) 3,776 Net mobilization fees 8,862 3,357 Other 1,244 223 ------- ------- 972 9,901 ------- ------- Net cash provided by operating activities 6,025 16,677 ------- ------- CASH FLOW FROM INVESTING ACTIVITIES: Capital expenditures (12,219) (28,396) ------- ------- Net cash used by investing activities (12,219) (28,396) ------- ------- CASH FLOW FROM FINANCING ACITIVITES: Proceeds from revolving credit facility 6,000 13,000 Principal payments on long-term debt (3,000) (750) Proceeds from exercises of stock options 37 --- ------- ------- Net cash provided by financing activities 3,037 12,250 ------- ------- NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (3,157) 531 CASH AND CASH EQUIVALENTS, at beginning of period 20,105 11,621 ------- ------- CASH AND CASH EQUIVALENTS, at end of period $16,948 $12,152 ======= ======= Supplemental disclosure of cash flow information: Cash paid during the quarter for domestic and foreign income taxes $ 2,373 $ 1,622 ======= ======= Cash paid during the quarter for interest, net of amounts capitalized $ 1,390 $ 1,769 ======= ======= The accompanying notes are an integral part of these consolidated financial statements.
PART I. ITEM 1 - FIANCIAL STATEMENTS ATWOOD OCEANICS, INC. AND SUBSIDIARIES NOTES TO CONSOLIDATED FINANCIAL STATEMENTS 1. UNAUDITED INTERIM INFORMATION The unaudited interim financial statements as of December 31, 1999 and for each of the three month periods ended December 31, 1999 and 1998, included herein, have been prepared by the Company, pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial reporting. Accordingly, these financial statements and related information have been prepared without audit, and certain information and note disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted, although management believes that the note disclosures are adequate to make the information not misleading. For interim periods, the Company records income taxes using the expected effective tax rate for the fiscal year. In the opinion of the Company's management, the unaudited interim financial statements reflect all adjustments (consisting of normal recurring adjustments) considered necessary for a fair presentation of the financial position and results of operations of the Company for the periods presented. The interim financial results may not be indicative of results that could be expected for a full year. 2. EARNINGS PER COMMON SHARE The computation of basic and diluted earnings per share is as follows (in thousands, except per share amounts): Per Share Net Income Shares Amount Three Months Ended - December 31, 1999: Basic earnings per share $ 5,053 13,676 $ .37 Effect of dilutive securities - Stock Options --- 183 (.01) Diluted earnings per share $ 5,053 13,859 $ .36 December 31, 1998: Basic earnings per share $ 6,776 13,625 $ .50 Effect of dilutive securities - Stock Options --- 130 (.01) Diluted earnings per share $ 6,776 13,755 $ .49 3. COMPREHENSIVE INCOME Comprehensive income includes the following (in thousands): First Quarter ---------------------- 1999 1998 ------- ------- Net Income $ 5,053 $ 6,776 Other comprehensive income: Unrealized holding loss on available-for-sale Securities, net of tax benefit of $8 and $48 in 1999 and 1998, respectively (15) (89) ------- ------- Comprehensive income $ 5,038 $ 6,687 ======= ======= PART I. ITEM 2 ATWOOD OCEANICS, INC. AND SUBSIDIARIES MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS All non-historical information set forth herein is based upon expectations and assumptions deemed reasonable by the Company. The Company can give no assurance that such expectations and assumptions will prove to have been correct, and actual results could differ materially from the information presented herein. The Company's periodic reports filed with the Securities and Exchange Commission should be consulted for a description of risk factors associated with an investment in the Company. MARKET OUTLOOK Even though, the price of oil is currently over $25 per barrel, worldwide fleet utilization for mobile offshore drilling units still remains below seventy-five percent. However, there are some encouraging indications that the offshore drilling market environment could improve in the second half of 2000. The Company has 65 percent of its total potential revenue days for 2000 currently committed, with the ATWOOD SOUTHERN CROSS, RIG-200 and RIG-19 being the Company's only drilling units without current contract commitments. Thus, even without market improvements, the Company's contract backlog should provide a high level of revenues and cash flows in fiscal 2000. RESULTS OF OPERATIONS Contract revenues for the three months ended December 31, 1999 decreased 11%, compared to the three months ended December 31, 1998. A comparative analysis of contract revenues is as follows: CONTRACT REVENUES (In millions) ------------------------------------------------ First Quarter First Quarter Fiscal 2000 Fiscal 1999 Variance ------------- -------------- --------- - - ATWOOD FALCON $10.5 $5.4 $5.1 VICKSBURG 3.4 0.4 3.0 ATWOOD HUNTER 8.8 8.7 0.1 ATWOOD SOUTHERN CROSS 0.0 0.0 0.0 SEAHAWK 2.2 2.9 (0.7) RICHMOND 1.5 2.4 (0.9) RIG-19 0.0 1.9 (1.9) RIG-200 0.0 2.1 (2.1) ATWOOD EAGLE 4.3 9.1 (4.8) GOODWYN 'A'/NORTH RANKIN 'A' 0.5 2.1 (1.6) ----- ----- ----- $31.2 $35.0 $(3.8) ===== ===== ===== The increase in revenues for the ATWOOD FALCON and VICKSBURG is due to both rigs working the entire first quarter of fiscal 2000 compared to working a limited number of days during the first quarter of fiscal 1999 due to completing their upgrades. The ATWOOD HUNTER continues to operate under its long-term contract commitment in the United States Gulf of Mexico. The ATWOOD SOUTHERN CROSS has not worked since it completed its last contract in September 1998. The decrease in the SEAHAWK'S revenues is due to the rig receiving a reduced dayrate during its upgrade period. The rig commenced drilling operations following its upgrade in January 2000. The decrease in revenues for the RICHMOND and ATWOOD EAGLE was due to reduced dayrates. When the ATWOOD EAGLE commenced working in the Mediterranean Sea in 1998, its dayrate was $115,000; currently its dayrate is $50,000. RIG-200 and RIG-19 are available for contracts since becoming idle in June and September 1999, respectively. Contract drilling and management costs decreased 13% in the first quarter of fiscal 2000 compared to the first quarter of fiscal 1999. An analysis of contract drilling and management costs by rig is as follows: CONTRACT DRILLING AND MANAGEMENT COSTS (In millions) --------------------------------------------- First Quarter First Quarter Fiscal 2000 Fiscal 1999 Variance ------------- ------------- ---------- VICKSBURG $1.5 $0.3 $1.2 ATWOOD FALCON 2.0 1.2 0.8 SEAHAWK 2.2 1.6 0.6 ATWOOD HUNTER 2.8 2.6 0.2 RICHMOND 1.3 1.6 (0.3) ATWOOD SOUTHERN CROSS 1.0 1.5 (0.5) RIG-200 0.0 0.6 (0.6) ATWOOD EAGLE 2.7 3.5 (0.8) RIG-19 0.1 1.4 (1.3) GOODWYN 'A'/NORTH RANKIN 'A' 0.4 1.7 (1.3) OTHER 0.4 0.6 (0.2) ----- ----- ----- $14.4 $16.6 $(2.2) ===== ===== ===== The increase in drilling costs for the VICKSBURG and ATWOOD FALCON is due to both rigs working the entire first quarter of fiscal 2000 while working only a portion of the first quarter of fiscal 1999 due to completing their upgrades during which no operating costs were incurred. The increase in operating costs for the SEAHAWK is due to additional costs incurred in December 1999 to mobilize and prepare the rig for commencement of drilling operation following its required upgrade for its four-year contract extension. The decline in costs for the ATWOOD SOUTHERN CROSS is due to a reduction in personnel costs due to its idle status. Following completion of contracts in fiscal 1999, RIG-200 and RIG-19 have been stacked on land in Australia with very little costs being incurred. Due to a reduction in maintenance and some personnel costs, operating costs for the ATWOOD EAGLE declined 23% during the first quarter of fiscal 2000 compared to the first quarter of fiscal 1999. As a result of reduced drilling operations for the GOODWYN 'A' and NORTH RANKIN 'A' platforms, revenues and costs have declined on these operations. The increase in depreciation expense is primarily due to a complete quarter of depreciation of the ATWOOD FALCON and VICKSBURG in fiscal 2000 compared to a partial quarter of depreciation in fiscal 1999. The Company does not recognize depreciation expense during the period a rig is out of service for a significant upgrade. A summary of the contract status of each of the Company's owned drilling units as of February 10, 2000 is as follows:
NAME OF RIG LOCATION CONTRACT STATUS ATWOOD FALCON Philippines Rig is under long-term contract which terminates in November 2001. ATWOOD HUNTER United States Rig is under long-term contract Gulf of Mexico which terminates in November 2000. ATWOOD EAGLE Mediterranean Sea Rig is currently being transported to Israel to commence short-term drilling program following a one-month water-depth upgrade to enable the rig to drill in up to 3,300 feet of water. Following completion of its drilling program in Israel, the rig will be moved to Egypt for a drilling program which should keep the rig employed for the remainder of fiscal 2000. VICKSBURG India Rig is under term contract which terminates in December 2000. SEAHAWK Malaysia The rig has commenced drilling in January 2000 under a four-year contract extension following its required upgrade. RICHMOND United States Rig is under contract until March 2000, Gulf of Mexico with ongoing discussions for additional work. ATWOOD SOUTHERN CROSS Australia Rig is available for contract since it became idle at the end of September 1998. RIG-19 and RIG-200 Australia Rigs are available for contract since they became idle at the end of June and September 1999, respectively.
LIQUIDITY AND CAPITAL RESOURCES During the first quarter of fiscal 2000, operating cash flow (before changes in working capital and other assets and liabilities) was $11.9 million compared to $12.2 million for the first quarter of fiscal 1999. During the first quarter of fiscal 2000, the Company utilized internally generated funds plus an additional net $3 million borrowed under its revolving credit facility to invest approximately $10.1 million in the upgrades of the SEAHAWK and ATWOOD EAGLE, and to fund approximately $2.1 million in other capital expenditures. In early February 2000, the Company completed an approximate $7 million water-depth upgrade of the ATWOOD EAGLE to enable the rig to drill in up to 3,300 feet of water. The Company is planning to perform in April/May 2000 a minor $3 million enhancement to the RICHMOND and is planning an additional $50 to $55 million future upgrade to the ATWOOD EAGLE to enable the rig to work in water depths of 4,500 to 5,000 feet. Subsequent to December 31, 1999, the Company reduced its outstanding debt to $55 million. The Company is currently ahead of its required debt repayment schedule. Depending upon additional capital investment opportunities, the Company will adjust planned capital expenditures, debt repayments and financing requirements in light of current market conditions. ATWOOD OCEANICS, INC. AND SUBSIDIARIES PART II. OTHER INFORMATION ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) Exhibits None (b) Reports on Form 8-K None 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. ATWOOD OCEANICS, INC. (Registrant) Date: February 10, 2000 s/JAMES M. HOLLAND______ James M. Holland Senior Vice President and Chief Accounting Officer EX-27 2
5 (Replace this text with the legend) 0000008411 Atwood Oceanics, Inc. 1,000 USD Year Sep-30-2000 Oct-01-1999 Dec-31-1999 1 16,948 22,915 31,486 0 7,892 59,145 377,328 152,879 307,696 15,679 57,000 0 0 13,678 52,338 307,696 31,184 31,184 16,355 22,499 0 0 954 8,268 3,215 5,053 0 0 0 5,053 .37 .36
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