0001140361-15-016172.txt : 20150423 0001140361-15-016172.hdr.sgml : 20150423 20150423074701 ACCESSION NUMBER: 0001140361-15-016172 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20150423 ITEM INFORMATION: Results of Operations and Financial Condition ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20150423 DATE AS OF CHANGE: 20150423 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CAMERON INTERNATIONAL CORP CENTRAL INDEX KEY: 0000941548 STANDARD INDUSTRIAL CLASSIFICATION: OIL & GAS FILED MACHINERY & EQUIPMENT [3533] IRS NUMBER: 760451843 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-13884 FILM NUMBER: 15786908 BUSINESS ADDRESS: STREET 1: 1333 WEST LOOP SOUTH STREET 2: STE 1700 CITY: HOUSTON STATE: TX ZIP: 77027 BUSINESS PHONE: 7135133322 MAIL ADDRESS: STREET 1: 1333 WEST LOOP SOUTH STREET 2: STE 1700 CITY: HOUSTON STATE: TX ZIP: 77027 FORMER COMPANY: FORMER CONFORMED NAME: COOPER CAMERON CORP DATE OF NAME CHANGE: 19950315 8-K 1 form8k.htm CAMERON INTERNATIONAL CORP 8-K 4-23-2015
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):
April 23, 2015
 
Cameron International Corporation
______________________________________________
(Exact Name of Registrant as Specified in its Charter)
 
Delaware
___________________
(State or other
jurisdiction of
incorporation)
1-13884
_________________
(Commission
File Number)
76-0451843
___________________
 (I.R.S. Employer
Identification No.)

1333 West Loop South, Suite 1700,
Houston, Texas
________________________________________
77027
 
_______________
(Address of Principal Executive Offices)
(Zip Code)

Registrant’s telephone number, including area code:
(713) 513-3300

Not Applicable
_______________________________________________________________________
(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:
 
o
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4 (c))
 
Item 2.02
Results of Operations and Financial Condition

On April 23, 2015 Cameron International Corporation (“Cameron”) issued a press release announcing its results for the first quarter ended March 31, 2015.  The press release is attached hereto as Exhibit 99.1 and is incorporated by reference into this item.
 
Item 9.01
Financial Statements and Exhibits.
 
(d)  Exhibits.
 
    The following is being furnished as an exhibit to this report:

Exhibit
Number
  
 
Exhibit Title or Description
Exhibit 99.1
  
Press Release of Cameron International Corporation, dated April 23, 2015 – Cameron First Quarter Earnings.
 
Exhibit 99.1 to this report contains a “non-GAAP financial measure” as defined in Item 10 of Regulation S-K of the Securities Exchange Act of 1934, as amended. The non-GAAP financial measure reflects adjusted EPS.  A reconciliation of adjusted EPS to the most directly comparable financial measures calculated and presented in accordance with Generally Accepted Accounting Principles in the United States (“GAAP”) is included as an attachment to the press release.  The Company believes the presentation of adjusted EPS is useful to the Company’s investors because adjusted EPS can be used in analyzing the company’s on-going earnings potential and understanding certain significant items impacting the comparability of our results.  In addition, adjusted EPS is a widely used benchmark in the investment community.
 
The presentation of this additional information is not meant to be considered in isolation or as a substitute for the Company’s financial results prepared in accordance with GAAP.
SIGNATURE

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.


 
CAMERON INTERNATIONAL CORPORATION
 
By:         /s/    Charles M. Sledge                                    
 
       Charles M. Sledge
 
      Senior Vice President and Chief Financial Officer
 
Date: April 23, 2015
Cameron International Corporation
Current Report on Form 8-K
Dated April 23, 2015
EXHIBIT INDEX
 
Exhibit
Number
  
Exhibit Title or Description
 
Press Release of Cameron International Corporation, dated April 23, 2015 – Cameron First Quarter Earnings.

EX-99.1 2 ex99_1.htm EXHIBIT 99.1
EXHIBIT 99.1

Contact:   Scott Lamb
Vice President, Investor Relations
 (713) 513-3344

CAMERON ANNOUNCES RESULTS FOR FIRST QUARTER OF 2015

· $0.91 fully diluted earnings per share excluding income from discontinued operations, asset impairment charges and other costs
· Strong execution and cost control drive quarterly results
· Subsea orders up compared to year-ago quarter and compared to Q4 of 2014

HOUSTON, April 23,  2015 -- Cameron (NYSE: CAM) today reported fully diluted earnings per share, excluding income from discontinued operations, asset impairment charges and other costs, of  $0.91 for the first quarter of 2015, compared to $0.70 for the same period of 2014.

Results for the first quarter of 2015 included income from discontinued operations of $429 million, or $2.22 per share, primarily associated with a gain on the previously announced sale of the Company’s Centrifugal Compression business; $538 million, or $2.79 per share, of asset impairment charges, primarily related to the impairment of goodwill in the Company’s Process Systems business; and $18 million, or $0.09 per share, of other costs for restructuring costs and mark-to-market impact on currency derivatives.  On a GAAP basis, the Company’s fully diluted earnings per share were $0.25 for the first quarter of 2015, as compared to $0.51 for the first quarter of 2014.

Commenting on the Company’s performance in the first quarter of 2015 relative to the year-ago period, Chairman and Chief Executive Officer Jack B. Moore, said, “Excluding the impact of the items cited above, Cameron delivered strong earnings, driven by sharp increases in operating income in our Subsea and Drilling segments as those businesses continued to successfully execute on their backlogs. Also contributing to the improvement in the Company’s results was the ongoing fundamental change in our cost structure, which resulted in a significant decline in SG&A expense.  Operating income in our Surface segment remained relatively unchanged as cost reduction efforts and excellent execution mitigated the decline in orders for the segment’s shorter-cycle business. Operating income in our Valves and Measurement segment was down considerably, reflecting the impact of weak orders in 2014 and the de-stocking of distributor inventories.”

The company’s effective tax rate for the quarter was 23.5%, excluding the impact of the gain and the asset impairment charges.

Orders and Backlog
Cameron’s new orders and backlog for the first quarter of 2015 declined sequentially and as compared to the year-ago period, reflecting reduced activity levels across the industry.   “Nevertheless,” said Moore, “orders in our Subsea segment were 30% above the year-ago quarter and 8% above the fourth quarter of 2014 due in part to the booking of a sizable subsea systems order for a BP development offshore Egypt.”
 
1
Cash Flow from Operations and Capital Program
Despite the customary increase in working capital during the first quarter, the Company ended the quarter with cash and short-term investments totaling $1.7 billion and a net debt to total capital ratio of 14%.

Cameron’s capital expenditures totaled $89 million in the first quarter of 2015, as compared to $105 million in the first quarter of 2014.

Share Repurchase Activity Continued
The Company acquired almost 4 million shares during the first quarter of 2015. Fully diluted shares outstanding at the end of the first quarter amounted to approximately 192 million.  As of the end of the first quarter of 2015, $298 million remained available under the Company’s existing share purchase authorization.

2015 Outlook
Moore said, “Cameron executed well over the first three months of the year, and that helped to offset the seasonal first-quarter weakness that we had expected.  Additionally, we saw accelerated benefits from our efforts to lower our fundamental cost structure and improve operational efficiency.  Even so, for the balance of the year, the cyclical downturn represents an increasing headwind relative to that experienced in the first quarter.”

Cameron (NYSE: CAM) is a leading provider of flow equipment products, systems and services to worldwide oil and gas industries.

###

Website: www.c-a-m.com

In addition to the historical data contained herein, this document includes forward-looking statements regarding anticipated revenues, operating income and earnings of the Company for 2015, as well as expectations regarding improved execution and cost reduction efforts, made in reliance upon the safe harbor provisions of the Private Securities Litigation Reform Act of 1995.

The Company’s actual results may differ materially from those described in forward-looking statements.  Such statements are based on current expectations of the Company’s performance and are subject to a variety of factors, some of which are not under the control of the Company, which can affect the Company’s results of operations, liquidity or financial condition.  Such factors may include overall demand for, and pricing of, the Company’s products, particularly as affected by North American activity; the size and timing of orders; the Company’s ability to successfully execute the large subsea and drilling systems projects it has been awarded; the possibility of cancellations of orders; the Company’s ability to convert backlog into revenues on a timely and profitable basis; the impact of acquisitions the Company has made or may make; changes in the price of (and demand for) oil and gas in both domestic and international markets; raw material costs and availability; political and social issues affecting the countries in which the Company does business; fluctuations in currency markets worldwide; and variations in global economic activity.  In particular, current and projected oil and gas prices historically have generally directly affected customers’ spending levels and their related purchases of the Company’s products and services.  Additionally, changes in oil and gas price expectations may impact the Company’s financial results due to changes it may make in its cost structure, staffing or spending levels.
 
2
Because the information herein is based solely on data currently available, it is subject to change as a result of changes in conditions over which the Company has no control or influence, and should not therefore be viewed as assurance regarding the Company’s future performance.  Additionally, the Company is not obligated to make public indication of such changes unless required under applicable disclosure rules and regulations.
 
3
Cameron
Unaudited Consolidated Condensed Results of Operations
($ and shares in millions except per share data)

   
Three Months Ended
March 31,
  
   
2015
    
2014
  
         
Revenues
  
$
2,273
    
$
2,329
  
                 
Costs and Expenses:
                
Cost of sales (exclusive of depreciation and amortization shown separately below)
    
1,608
      
1,690
  
Selling and administrative expenses
    
286
      
318
  
Depreciation and amortization
    
89
      
85
  
Interest, net
    
38
      
32
  
Asset impairment charges
    
553
      
40
  
Other costs
    
24
      
9
  
Total costs and expenses
    
2,598
      
2,174
  
                 
Income (loss) from continuing operations before income taxes
    
(325
)
    
155
  
Income tax provision
    
(53
)
    
(45
)
Income (loss) from continuing operations
    
(378
)
    
110
  
Income from discontinued operations, net of income taxes
    
429
      
5
  
Net income
    
51
      
115
  
Less: Net income attributable to noncontrolling interests
    
2
      
4
  
Net income attributable to Cameron stockholders
  
$
49
    
$
111
  
                 
Amounts attributable to Cameron stockholders:
                
Income (loss) from continuing operations
  
$
(380
)
  
$
106
  
Income from discontinued operations
    
429
      
5
  
Net income attributable to Cameron stockholders
  
$
49
    
$
111
  
Earnings (loss) per common share attributable to Cameron stockholders:
                
Basic-
                
Continuing operations
  
$
(1.97
)
  
$
0.49
  
Discontinued operations
    
2.22
      
0.02
  
Basic earnings per share
  
$
0.25
    
$
0.51
  
                 
Diluted-
                
Continuing operations
  
$
(1.97
)
  
$
0.49
  
Discontinued operations
    
2.22
      
0.02
  
Diluted earnings per share
  
$
0.25
    
$
0.51
  
Shares used in computing earnings per common share:
                
Basic
    
193
      
215
  
Diluted
    
193
      
216
  
 
4
Cameron
Consolidated Condensed Balance Sheets
($ millions)

   
March 31,
2015
    
December 31,
2014
  
   
(unaudited)
      
Assets:
        
Cash and cash equivalents
  
$
1,322
    
$
1,513
  
Short-term investments
    
424
      
113
  
Receivables, net
    
2,178
      
2,389
  
Inventories, net
    
2,930
      
2,929
  
Other current assets
    
397
      
391
  
Assets of discontinued operations
    
–
      
217
  
Total current assets
    
7,251
      
7,552
  
                 
Plant and equipment, net
    
1,830
      
1,964
  
Goodwill
    
1,858
      
2,461
  
Intangibles, net
    
679
      
728
  
Other assets
    
187
      
187
  
Total Assets
  
$
11,805
    
$
12,892
  
                 
Liabilities and Stockholders’ Equity:
                
Short-term debt
  
$
31
    
$
263
  
Accounts payable and accrued liabilities
    
3,194
      
3,748
  
Accrued income taxes
    
393
      
168
  
Liabilities of discontinued operations
    
–
      
90
  
Total current liabilities
    
3,618
      
4,269
  
                 
Long-term debt
    
2,813
      
2,819
  
Deferred income taxes
    
179
      
193
  
Other long-term liabilities
    
166
      
167
  
Total liabilities
    
6,776
      
7,448
  
                 
Stockholders’ Equity:
                
Common stock, par value $.01 per share, 400,000,000 shares authorized, 263,111,472 shares issued at March 31, 2015 and December 31, 2014
    
3
      
3
  
Capital in excess of par value
    
3,234
      
3,255
  
Retained earnings
    
5,680
      
5,631
  
Accumulated other elements of comprehensive income (loss)
    
(765
)
    
(540
)
Less:  Treasury stock, 71,543,192 shares at March 31, 2015 (68,139,027 shares at December 31, 2014)
    
(3,949
)
    
(3,794
)
Total Cameron stockholders’ equity
    
4,203
      
4,555
  
Noncontrolling interests
    
826
      
889
  
Total equity
    
5,029
      
5,444
  
                 
Total Liabilities and Stockholders’ Equity
  
$
11,805
    
$
12,892
  
 
5
Cameron
Unaudited Consolidated Condensed Statements of Cash Flows
($ millions)

   
Three Months Ended
March 31,
  
   
2015
    
2014
  
         
Cash flows from operating activities:
        
Net income
  
$
51
    
$
115
  
Adjustments to reconcile net income to net cash used for operating activities:
                
Asset impairment charges
    
553
      
40
  
Pre-tax gain on sale of Centrifugal Compression business
    
(680
)
    
–
  
Depreciation
    
75
      
68
  
Amortization
    
14
      
19
  
Non-cash stock compensation expense
    
10
      
14
  
Deferred income taxes and tax benefit of stock compensation plan transactions
    
(2
)
    
(16
)
Changes in assets and liabilities, net of translation and non-cash items:
                
Receivables
    
147
      
(60
)
Inventories
    
(105
)
    
(175
)
Accounts payable and accrued liabilities
    
(471
)
    
(213
)
Other assets and liabilities, net
    
215
      
34
  
Net cash used for operating activities
    
(193
)
    
(174
)
Cash flows from investing activities:
                
Pre-tax net proceeds received from sale of Centrifugal Compression business
    
831
      
–
  
Proceeds from sales and maturities of short-term investments
    
122
      
5
  
Purchases of short-term investments
    
(433
)
    
(5
)
Capital expenditures
    
(89
)
    
(105
)
Proceeds from sales of plant and equipment
    
6
      
6
  
Net cash provided by (used for) investing activities
    
437
      
(99
)
Cash flows from financing activities:
                
Short-term loan borrowings (repayments), net
    
(201
)
    
330
  
Purchase of treasury stock
    
(182
)
    
(902
)
Proceeds from stock option exercises, net of tax payments from stock compensation plan transactions
    
(8
)
    
9
  
Excess tax benefits from stock compensation plan transactions
    
1
      
2
  
Principal payments on capital leases
    
(6
)
    
(3
)
Net cash used for financing activities
    
(396
)
    
(564
)
Effect of translation on cash
    
(39
)
    
(4
)
Decrease in cash and cash equivalents
    
(191
)
    
(841
)
Cash and cash equivalents, beginning of period
    
1,513
      
1,813
  
Cash and cash equivalents, end of period
  
$
1,322
    
$
972
  
 
6
Cameron
Unaudited Supplemental Segment Financial Data
 ($ millions)

   
Three Months Ended
March 31,
  
   
2015
    
2014
  
         
Revenues:
        
Subsea
  
$
631
    
$
681
  
Surface
    
543
      
538
  
Drilling
    
726
      
667
  
Valves and Measurement (V&M)
    
428
      
500
  
Elimination of intersegment revenues
    
(55
)
    
(57
)
Consolidated revenues
  
$
2,273
    
$
2,329
  
                 
Segment operating income before interest and income taxes:
                
Subsea
  
$
57
    
$
29
  
Surface
    
92
      
91
  
Drilling
    
135
      
67
  
V&M
    
45
      
98
  
Elimination of intersegment earnings
    
(16
)
    
(12
)
Segment operating income before interest and income taxes
    
313
      
273
  
                 
Corporate Items:
                
Corporate expense
    
(23
)
    
(37
)
Interest, net
    
(38
)
    
(32
)
Goodwill impairment and other costs
    
(577
)
    
(49
)
Consolidated income (loss) from continuing operations before income taxes
  
$
(325
)
  
$
155
  
                 
Orders:
                
Subsea
  
$
560
    
$
430
  
Surface
    
450
      
635
  
Drilling
    
267
      
817
  
V&M
    
388
      
536
  
Consolidated orders
  
$
1,665
    
$
2,418
  

Backlog (at end of period):
  
March 31,
2015
    
December 31,
2014
    
March 31,
2014
  
Subsea
  
$
4,101
    
$
4,263
    
$
4,805
  
Surface
    
1,009
      
1,025
      
1,063
  
Drilling
    
2,864
      
3,327
      
4,050
  
V&M
    
810
      
921
      
1,057
  
Consolidated backlog
  
$
8,784
    
$
9,536
    
$
10,975
  
 
7
Cameron
Reconciliation of GAAP to Non-GAAP Financial Information
($ millions, except per share amounts)

   
Three Months Ended
March 31, 2015
  
   
After Tax
    
EPS
  
Net loss attributable to Cameron from continuing operations
  
$
(380
)
  
$
(1.97
)
Adjustments:
                
Asset impairment charges (1)
    
538
          
Mark-to-market impact on currency derivatives not designated as accounting hedges(2)
    
9
          
Restructuring and other net costs(2)
    
9
          
Net income attributable to Cameron, excluding charges
  
$
176
    
$
0.91
(3) 

(1)
Majority is non-deductible for tax purposes
(2)
Individual adjustment assumes a 23.5% effective tax rate
(3)
Based on approximately 194 million shares

   
Three Months Ended
March 31, 2014
  
   
After Tax
    
Diluted EPS(2)
  
Net income attributable to Cameron from continuing operations
  
$
106
    
$
0.49
  
Adjustments:
                
Impairment of goodwill(1)
    
40
          
Acquisition, restructuring and other costs
    
6
          
Net income attributable to Cameron, excluding charges
  
$
152
    
$
0.70
  

(1)
Adjustment is non-deductible for tax purposes
(2)
Based on 216 million diluted shares
 
 
8