EX-99.1 3 d10012exv99w1.txt PRESS RELEASE EXHIBIT 99.1 FOR IMMEDIATE RELEASE Contact: John E. Vollmer III SVP-Corporate Development Patterson-UTI Energy, Inc. (214) 360-7800 PATTERSON-UTI ENERGY ANNOUNCES THIRD QUARTER RESULTS NET INCOME UP 42 PERCENT OVER PRIOR QUARTER SNYDER, TEXAS - OCTOBER 29, 2003 - PATTERSON-UTI ENERGY, INC. (NASDAQ: PTEN), today announced financial results for the three and nine months ended September 30, 2003. The Company reported net income of $17.1 million, or $0.21 per share, for the three-month period, compared to net income of $249,000, or $0.00 per share, for the comparable three months in 2002. Revenues for the quarter were $207.0 million, versus $133.5 million for the three months ended September 30, 2002. Net income for the nine months ended September 30, 2003 was $34.9 million, or $0.43 per share, compared to net income of $339,000, or $0.00 per share, for the nine months ended September 30, 2002. Revenues for the nine months totaled $567.9 million, compared to $387.1 million for the comparable nine-month period in 2002. Cloyce A. Talbott, Patterson-UTI's Chief Executive Officer, commented, "While demand for drilling rigs has remained relatively stable over the past several months, we have increased average revenues and margin per drilling day. Compared to the second quarter of 2003, our average revenue per drilling day increased by $340 to $9,580 and our average margin per drilling day increased by $370 to $2,600. "During the third quarter of 2003, we had an average of 192 rigs operating, including 11 in Canada. While we are beginning to see an increase in the demand for drilling services, recent activity has been impacted by wet conditions in Texas, which have caused delays in preparing drilling locations and moving rigs. We estimate that our rig count will average 188 rigs operating for October, including 12 in Canada, and expect our rig count to increase as the negative effect of the wet conditions diminishes," Talbott added. Mark S. Siegel, Chairman of Patterson-UTI Energy, stated, "Our results again demonstrate the earnings leverage that we are able to achieve as daily drilling margins improve. Net income for the quarter increased 42% compared to the second quarter on a 6% increase in revenues. "Looking ahead, we expect the demand for drilling rigs to increase in the coming months as producers seek to overcome natural gas production declines and to profit from the strong commodity prices," he added. The results for the nine-month period in 2003 include income in the amount of $2.5 million ($1.6 million after tax) from the collection of a disputed receivable acquired in the 1999 merger with Norton Drilling Services, Inc., as well as a net of tax charge of $469,000 resulting from a change in the accounting rules (SFAS No.143) pertaining to the Company's exploration and production activities. The results for the 2002 nine-month period include a pretax charge of $4.7 million ($2.8 million after tax) due to the financial failure of a workers' compensation insurance carrier that had provided coverage for the Company between 1992 and March of 2001. All references to "earnings per share" in this press release are diluted earnings per share as defined within the Statement of Financial Accounting Standards No. 128. The Company will hold its quarterly conference call to discuss third quarter results today at 11:00 a.m. Eastern (10:00 a.m. Central and 8:00 a.m. Pacific). This call is being Webcast and can be accessed through Patterson-UTI's Web site at www.patenergy.com or at www.streetevents.com in the Individual Investor Center. Replay of the conference call Webcast will be available at these same sites until Wednesday, November 12, 2003. ABOUT PATTERSON-UTI Patterson-UTI Energy, Inc. provides onshore contract drilling services to exploration and production companies in North America. The Company owns 340 land-based drilling rigs that operate primarily in the oil and natural gas producing regions of Texas, New Mexico, Oklahoma, Utah, Louisiana, Mississippi and western Canada. Patterson-UTI Energy, Inc. is also engaged in the businesses of pressure pumping services and drilling and completion fluid services. Additionally, the Company has a small exploration and production business that is based in Texas. Statements made in this press release which state the Company's or management's intentions, beliefs, expectations or predictions for the future are forward-looking statements. It is important to note that actual results could differ materially from those discussed in such forward-looking statements. Important factors that could cause actual results to differ materially include, but are not limited to, declines in oil and natural gas prices that could adversely affect demand for the Company's services, and their associated effect on day rates, rig utilization and planned capital expenditures, adverse industry conditions, difficulty in integrating acquisitions, demand for oil and natural gas, and ability to retain management and field personnel. Additional information concerning factors that could cause actual results to differ materially from those in the forward-looking statements is contained from time to time in the Company's SEC filings. Copies of these filings may be obtained by contacting the Company or the SEC. PATTERSON-UTI ENERGY, INC. Condensed Consolidated Statements of Income (Unaudited) (in thousands, except per share data)
Three Months Ended Nine Months Ended September 30, September 30, -------------------------- -------------------------- 2003 2002 2003 2002 ----------- ----------- ----------- ----------- REVENUES $ 207,015 $ 133,495 $ 567,878 $ 387,081 COSTS AND EXPENSES Direct operating costs (excluding depreciation, depletion and amortization) 148,700 103,374 420,917 294,206 Depreciation, depletion and amortization 24,716 23,178 73,825 68,470 Selling, general and administrative 6,853 6,186 20,560 19,139 Bad debt expense 97 165 259 195 Restructuring and other charges -- -- -- 4,700 Other (705) (91) (4,034) (149) ----------- ----------- ----------- ----------- Total Costs and Expenses 179,661 132,812 511,527 386,561 ----------- ----------- ----------- ----------- OPERATING INCOME 27,354 683 56,351 520 ----------- ----------- ----------- ----------- OTHER INCOME (EXPENSE) Interest expense (68) (93) (216) (298) Interest income 263 261 808 754 Other 52 (135) 137 (110) ----------- ----------- ----------- ----------- Total Other Income 247 33 729 346 ----------- ----------- ----------- ----------- INCOME BEFORE INCOME TAXES AND CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE 27,601 716 57,080 866 INCOME TAXES 10,488 467 21,690 527 ----------- ----------- ----------- ----------- INCOME BEFORE CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE 17,113 249 35,390 339 CUMULATIVE EFFECT OF CHANGE IN ACCOUNTING PRINCIPLE, net of $287 income tax -- -- (469) -- ----------- ----------- ----------- ----------- NET INCOME $ 17,113 $ 249 $ 34,921 $ 339 =========== =========== =========== =========== NET INCOME PER COMMON SHARE BASIC: Income before cumulative effect of change in accounting principle $ 0.21 $ 0.00 $ 0.44 $ 0.00 Cumulative effect of change in accounting principle -- -- (0.01) -- ----------- ----------- ----------- ----------- Net Income $ 0.21 $ 0.00 $ 0.43 $ 0.00 =========== =========== =========== =========== DILUTED: Income before cumulative effect of change in accounting principle $ 0.21 $ 0.00 $ 0.43 $ 0.00 Cumulative effect of change in accounting principle -- -- -- -- ----------- ----------- ----------- ----------- Net Income $ 0.21 $ 0.00 $ 0.43 $ 0.00 =========== =========== =========== =========== AVERAGE COMMON SHARES OUTSTANDING Basic 80,904 78,964 80,535 78,378 =========== =========== =========== =========== Diluted 82,191 80,963 82,261 80,782 =========== =========== =========== ===========
PATTERSON-UTI ENERGY, INC. Additional Financial and Operating Data (Unaudited) (dollars in thousands)
Three Months Ended Nine Months Ended September 30, September 30, 2003 2002 2003 2002 ---------- ---------- ---------- ---------- Contract Drilling: Revenues $ 169,077 $ 100,267 $ 468,609 $ 300,668 Direct operating costs (excluding depreciation and amortization) $ 123,156 $ 80,374 $ 353,893 $ 232,129 Selling, general and administrative $ 1,110 $ 918 $ 3,339 $ 3,075 Operating days 17,652 11,656 51,263 33,052 Average revenue per operating day $ 9.58 $ 8.60 $ 9.14 $ 9.09 Average direct operating costs per operating day $ 6.98 $ 6.90 $ 6.90 $ 7.02 Average margin per operating day $ 2.60 $ 1.70 $ 2.24 $ 2.07 Number of owned rigs at end of period 340 324 340 324 Average number of rigs owned during period 340 324 334 322 Average rigs operating 192 127 188 121 Rig utilization percentage 56% 39% 56% 38% Capital expenditures $ 26,598 $ 10,713 $ 67,537 $ 48,979 Drilling and Completion Fluids: Revenues $ 19,580 $ 19,714 $ 51,431 $ 52,049 Direct operating costs (excluding depreciation and amortization) $ 17,180 $ 16,393 $ 45,483 $ 44,965 Selling, general and administrative $ 1,870 $ 1,783 $ 5,418 $ 5,271 Total jobs 459 383 1,460 1,056 Average revenue per job $ 42.66 $ 51.47 $ 35.23 $ 49.29 Average costs per job $ 37.43 $ 42.80 $ 31.15 $ 42.58 Average margin per job $ 5.23 $ 8.67 $ 4.08 $ 6.71 Capital expenditures $ 282 $ 154 $ 559 $ 1,095 Pressure Pumping: Revenues $ 13,198 $ 9,649 $ 31,509 $ 23,691 Direct operating costs (excluding depreciation) $ 7,226 $ 5,618 $ 18,032 $ 14,127 Selling, general and administrative $ 1,375 $ 975 $ 4,131 $ 3,136 Total jobs 1,614 1,137 3,921 2,753 Average revenue per job $ 8.18 $ 8.49 $ 8.04 $ 8.61 Average costs per job $ 4.48 $ 4.94 $ 4.60 $ 5.13 Average margin per job $ 3.70 $ 3.55 $ 3.44 $ 3.48 Capital expenditures $ 2,880 $ 2,018 $ 8,999 $ 4,392 Oil and Natural Gas Production and Exploration: Revenues $ 5,160 $ 3,865 $ 16,329 $ 10,673 Direct operating costs (excluding depreciation and depletion) $ 1,138 $ 989 $ 3,509 $ 2,985 Selling, general and administrative $ 358 $ 301 $ 1,090 $ 1,148 Capital expenditures $ 3,052 $ 1,014 $ 7,368 $ 5,441 Corporate and Other: Selling, general and administrative $ 2,140 $ 2,209 $ 6,582 $ 6,509 Bad debt expense $ 97 $ 165 $ 259 $ 195 Other $ (705) $ (91) $ (4,034) $ 4,551 Capital expenditures $ -- $ 2,528 $ -- $ 2,528 Total capital expenditures, excluding acquisitions $ 32,812 $ 16,427 $ 84,463 $ 62,435
September 30, September 30, 2003 2002 ------------- ------------- Selected Balance Sheet Data: Cash and cash equivalents $ 111,317 $ 63,618 Current assets $ 293,140 $ 216,912 Total assets $ 1,040,847 $ 912,704 Current liabilities $ 111,078 $ 70,690 Long-term debt, less current maturities $ -- $ -- Working capital $ 182,062 $ 146,222