Attached files
| file | filename |
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| 8-K - FORM 8-K - Willbros Group, Inc.\NEW\ | c04691e8vk.htm |
| EX-99.2 - EXHIBIT 99.2 - Willbros Group, Inc.\NEW\ | c04691exv99w2.htm |
Exhibit 99.1
| PRESS RELEASE |  |
FOR IMMEDIATE RELEASE
Willbros Reports Second Quarter 2010 Results
| • | Operating income from continuing operations of $16.4 million, $0.23 per basic and
diluted share |
||
| • | Adjusted EBITDA of $29.3 million |
HOUSTON, TX, AUGUST 4, 2010 — Willbros Group, Inc. (NYSE: WG) announced results for the second
quarter 2010. For the second quarter of 2010, Willbros reported earnings from continuing
operations of $9.1 million, or $0.23 per basic and diluted share, on revenue of $248.1 million.
Second quarter results were favorably impacted by increased activity in the Upstream Oil & Gas
segment including additional work assignments in the Company’s Upstream Engineering unit. Willbros
also reported that second quarter net income was partially offset by costs of approximately $1.1
million associated with the transaction to acquire InfrastruX Group, Inc. and other charges of
approximately $800 thousand associated with headcount reductions and change in estimate on one
lease abandonment.
Randy Harl, President and Chief Executive Officer, commented, “The investments we have made in our
systems and procedures have enabled us to continue to improve project execution to meet demanding
productivity and schedule requirements. With high confidence in our project execution, we are
seeing a resultant increase in bookings as we focus and hone our sales and marketing activities.
We believe our recent awards in Canada and growth in our Upstream Engineering backlog are positive
indications of improvement in both the Upstream segment business environment and our processes and
execution. Our Downstream segment continues to face margin pressure and we are adjusting our
strategy to align our cost structure to meet the challenges in this business segment. However, we
are beginning to see a modest improvement in Downstream Engineering and we are encouraged by
increasing Engineering and EPC inquiries. We view increased engineering activity in our Upstream
and Downstream segments as precursors to a more robust construction environment.
“With the completion of the InfrastruX acquisition in early July, our short term focus is on
integrating and optimizing this expansion of our service offerings and market access.”
Segment Operating Results
The Upstream Oil & Gas segment reported operating income for the second quarter of $22.8 million on
revenue of $186.6 million. Operating results were driven by full utilization of two spreads of
personnel and equipment deployed on large diameter pipeline construction in the United States and
increased activity in the Upstream Engineering unit, including increased levels of work under
alliance agreements. We believe the increase in our Upstream Engineering backlog is a precursor to
increased construction
activity and we have already begun to see inquiries rise for both small and large diameter pipeline
projects. Positive performance in Oman also contributed to Upstream results, despite margin
pressure in the region.
WILLBROS
|
1 of 5 | |||
| CONTACT: | ||||
| Michael W. Collier | Connie Dever | |||
| Vice President Investor Relations | Director Strategic Planning | |||
| Sales & Marketing | Willbros | |||
| Willbros | 713-403-8035 | |||
| 713-403-8038 |
| PRESS RELEASE | |
The Downstream Oil & Gas segment reported an operating loss of $6.4 million on revenue of $61.5
million. The Downstream segment continues to experience delays to previously booked maintenance
activities and an absence of capital projects for its specialty construction services. However,
increased inquiries for our Downstream Engineering services in the first quarter are now beginning
to result in new awards. In the second quarter, the Company appointed a new management team in the
Downstream segment to bolster its competitive position in this market.
Backlog(3)
At June 30, 2010, Willbros reported backlog from continuing operations of $433.4 million compared
to $391.7 million at December 31, 2009. Approximately 54.5 percent of backlog was attributable to
recurring services contracts.
InfrastruX Acquisition
On July 1, 2010, the Company completed the acquisition of 100 percent of the outstanding stock of
InfrastruX Group, Inc. (“InfrastruX”) for a purchase price of approximately $418 million before
working capital and other transaction adjustments. The Company paid approximately $360 million in
cash, a portion of which was used to retire InfrastruX indebtedness and pay InfrastruX transaction
expenses, and issued approximately 7.9 million shares of the Company’s common stock to the
shareholders of InfrastruX. Cash paid was comprised of $60.0 million in operating cash and $300.0
million provided from a newly issued term loan facility. The acquisition was completed pursuant to
an Agreement and Plan of Merger, dated March 11, 2010.
Liquidity
At June 30, 2010, Willbros had liquidity of $282.6 million, comprised of $227.3 million in cash,
short-term investments of $5.3 million, and $50.0 million unutilized borrowing capacity under our
2007 Credit Facility. The company paid approximately $60.0 million in cash to fund a portion of the
transaction to acquire InfrastruX on July 1, 2010.
Guidance
Van Welch, Chief Financial Officer, updated earnings guidance for 2010: “To reflect the full effect
of the acquisition of InfrastruX, including purchase price accounting estimates, and the continued
volatility of the markets we serve, we are adjusting our annual guidance for continuing operations
for the combined companies, with the inclusion of InfrastruX from July 1 — December 31, 2010, to
range from a loss of $(0.20) to breakeven or $0.00 per diluted share on revenue of $1.2 to $1.3
billion.” The Company will provide details of the change in guidance on its August 5, 2010
conference call.
WILLBROS
|
2 of 5 | |||
| CONTACT: | ||||
| Michael W. Collier | Connie Dever | |||
| Vice President Investor Relations | Director Strategic Planning | |||
| Sales & Marketing | Willbros | |||
| Willbros | 713-403-8035 | |||
| 713-403-8038 |
| PRESS RELEASE | |
Conference Call
In conjunction with this release, Willbros has scheduled a conference call, which will be broadcast
live over the Internet on Thursday, August 5, 2010, at 9:00 a.m. Eastern Time (8:00 a.m. Central).
What:
|
Willbros Group, Inc. Second Quarter 2010 Earnings Conference Call | |
When:
|
Thursday, August 5, 2010 — 9:00 a.m. Eastern Time | |
Where:
|
Live via phone by dialing 888-713-4515 or 913-312-1513, passcode 8451428, and asking for the Willbros call at least 10 minutes prior to the start time. | |
Where:
|
Live over the Internet by logging onto www.willbros.com on the home page under Events. |
A telephonic replay of the conference call will be available through August 19, 2010 and may be
accessed by calling 888-203-1112 or 719-457-0820 and using the passcode 8451428. Also, an archive
of the webcast will be available shortly after the call on www.willbros.com for a period of
12 months.
Willbros Group, Inc. is an independent contractor serving the oil, gas, power, refining and
petrochemical industries, providing engineering, construction, turnaround, maintenance, life-cycle
extension services and facilities development and operations services to industry and government
entities worldwide. For more information on Willbros, please visit our web site at
www.willbros.com.
This announcement contains forward-looking statements. All statements, other than statements of
historical facts, which address activities, events or developments the Company expects or
anticipates will or may occur in the future, are forward-looking statements. A number of risks and
uncertainties could cause actual results to differ materially from these statements, including the
potential for additional investigations; the disruptions to the global credit markets; the current
global recession; fines and penalties by government agencies; new legislation or regulations
detrimental to the economic operation of refining capacity in the United States; the identification
of one or more other issues that require restatement of one or more prior period financial
statements; contract and billing disputes; the integration and operation of InfrastruX; the
possible losses arising from the discontinuation of operations and the sale of the Nigeria assets;
the existence of material weaknesses in internal controls over financial reporting; availability of
quality management; availability and terms of capital; changes in, or the failure to comply with,
government regulations; ability to remain in compliance with, or obtain waivers under, the
Company’s loan agreements and indentures; the promulgation, application, and interpretation of
environmental laws and regulations; future E&P capital expenditures; oil, gas, gas liquids, and
power prices and demand; the amount and location of planned pipelines; the refinery crack spread
and planned refinery outages and upgrades; the effective tax rate of the different countries where
the work is being conducted; development trends of the oil, gas, power, refining and petrochemical
industries and changes in the political and economic environment of the countries in which the
Company has operations; as well as other risk factors described from time to time in the Company’s
documents and reports filed with the SEC. The Company assumes no obligation to update publicly
such forward-looking statements, whether as a result of new information, future events or
otherwise.
TABLE TO FOLLOW
WILLBROS
|
3 of 5 | |||
| CONTACT: | ||||
| Michael W. Collier | Connie Dever | |||
| Vice President Investor Relations | Director Strategic Planning | |||
| Sales & Marketing | Willbros | |||
| Willbros | 713-403-8035 | |||
| 713-403-8038 |
| PRESS RELEASE | |
WILLBROS GROUP, INC.
(In thousands, except per share amounts)
(In thousands, except per share amounts)
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30 | June 30 | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
Income Statement |
||||||||||||||||
Contract revenue |
||||||||||||||||
Upstream O&G |
$ | 186,600 | $ | 275,409 | $ | 263,100 | $ | 663,897 | ||||||||
Downstream O&G |
61,529 | 79,074 | 122,025 | 154,511 | ||||||||||||
| 248,129 | 354,483 | 385,125 | 818,408 | |||||||||||||
Operating expenses |
||||||||||||||||
Upstream O&G |
163,802 | 260,157 | 252,141 | 622,407 | ||||||||||||
Downstream O&G |
67,932 | 75,432 | 137,371 | 151,012 | ||||||||||||
| 231,734 | 335,589 | 389,512 | 773,419 | |||||||||||||
Operating income (loss) |
||||||||||||||||
Upstream O&G |
22,798 | 15,252 | 10,959 | 41,490 | ||||||||||||
Downstream O&G |
(6,403 | ) | 3,642 | (15,346 | ) | 3,499 | ||||||||||
Operating income (loss) |
16,395 | 18,894 | (4,387 | ) | 44,989 | |||||||||||
Other expense |
||||||||||||||||
Interest — net |
(2,075 | ) | (2,011 | ) | (4,182 | ) | (4,116 | ) | ||||||||
Other — net |
891 | (217 | ) | 2,862 | 108 | |||||||||||
| (1,184 | ) | (2,228 | ) | (1,320 | ) | (4,008 | ) | |||||||||
Income (loss) from continuing operations before income taxes |
15,211 | 16,666 | (5,707 | ) | 40,981 | |||||||||||
Provision (benefit) for income taxes |
5,753 | 5,675 | (2,387 | ) | 13,915 | |||||||||||
Income (loss) from continuing operations |
9,458 | 10,991 | (3,320 | ) | 27,066 | |||||||||||
Income (loss) from discontinued operations net of provision for income taxes |
(476 | ) | (1,660 | ) | (746 | ) | (1,500 | ) | ||||||||
Net income (loss) |
8,982 | 9,331 | (4,066 | ) | 25,566 | |||||||||||
Less: Income attributable to noncontrolling interest |
(353 | ) | (423 | ) | (609 | ) | (1,171 | ) | ||||||||
Net income (loss) attributable to Willbros Group, Inc. |
$ | 8,629 | $ | 8,908 | $ | (4,675 | ) | $ | 24,395 | |||||||
Reconciliation of net income (loss) attributable to Willbros Group, Inc.
|
||||||||||||||||
Income (loss) from continuing operations |
$ | 9,105 | $ | 10,568 | $ | (3,929 | ) | $ | 25,895 | |||||||
Income (loss) from discontinued operations |
(476 | ) | (1,660 | ) | (746 | ) | (1,500 | ) | ||||||||
Net income (loss) attributable to Willbros Group, Inc. |
$ | 8,629 | $ | 8,908 | $ | (4,675 | ) | $ | 24,395 | |||||||
Basic income (loss) per share attributable to Company shareholders: |
||||||||||||||||
Continuing operations |
$ | 0.23 | $ | 0.27 | $ | (0.10 | ) | $ | 0.67 | |||||||
Discontinued operations |
(0.01 | ) | (0.04 | ) | (0.02 | ) | (0.04 | ) | ||||||||
| $ | 0.22 | $ | 0.23 | $ | (0.12 | ) | $ | 0.63 | ||||||||
Diluted income (loss) per share attributable to Company shareholders: |
||||||||||||||||
Continuing operations |
$ | 0.23 | $ | 0.27 | $ | (0.10 | ) | $ | 0.66 | |||||||
Discontinued operations |
(0.01 | ) | (0.04 | ) | (0.02 | ) | (0.03 | ) | ||||||||
| $ | 0.22 | $ | 0.23 | $ | (0.12 | ) | $ | 0.63 | ||||||||
Cash Flow Data |
||||||||||||||||
Continuing operations |
||||||||||||||||
Cash provided by (used in) |
||||||||||||||||
Operating activities |
$ | 45,886 | $ | 10,864 | $ | 45,631 | $ | 67,967 | ||||||||
Investing activities |
7,338 | 1,552 | 4,226 | (1,558 | ) | |||||||||||
Financing activities |
(14,235 | ) | (22,540 | ) | (19,613 | ) | (29,367 | ) | ||||||||
Foreign exchange effects |
(1,813 | ) | 1,204 | (970 | ) | 565 | ||||||||||
Discontinued operations |
(713 | ) | (1,280 | ) | (746 | ) | (79 | ) | ||||||||
WILLBROS
|
4 of 5 | |||
| CONTACT: | ||||
| Michael W. Collier | Connie Dever | |||
| Vice President Investor Relations | Director Strategic Planning | |||
| Sales & Marketing | Willbros | |||
| Willbros | 713-403-8035 | |||
| 713-403-8038 |
| PRESS RELEASE | |
| Three Months Ended | Six Months Ended | |||||||||||||||
| June 30 | June 30 | |||||||||||||||
| 2010 | 2009 | 2010 | 2009 | |||||||||||||
Other Data (Continuing Operations) |
||||||||||||||||
Weighted average shares outstanding |
||||||||||||||||
Basic |
39,018 | 38,684 | 38,979 | 38,624 | ||||||||||||
Diluted |
42,352 | 43,730 | 38,979 | 43,641 | ||||||||||||
EBITDA(1) |
$ | 24,931 | $ | 28,591 | $ | 14,337 | $ | 65,492 | ||||||||
Capital expenditures |
3,139 | 3,474 | 8,944 | 6,659 | ||||||||||||
Reconciliation of Non-GAAP Financial Measure |
||||||||||||||||
EBITDA (1), (2) |
||||||||||||||||
Net income (loss) from continuing operations attributable to Willbros Group, Inc. |
$ | 9,105 | $ | 10,568 | $ | (3,929 | ) | $ | 25,895 | |||||||
Interest — net |
2,075 | 2,011 | 4,182 | 4,116 | ||||||||||||
Provision (benefit) for income taxes |
5,753 | 5,675 | (2,387 | ) | 13,915 | |||||||||||
Depreciation and amortization |
7,998 | 10,337 | 16,471 | 21,566 | ||||||||||||
EBITDA |
24,931 | 28,591 | 14,337 | 65,492 | ||||||||||||
Stock based compensation |
2,286 | 2,319 | 4,297 | 4,917 | ||||||||||||
Restructuring and reorganization costs |
794 | 956 | 613 | 5,790 | ||||||||||||
Acquisition related costs |
1,060 | — | 1,944 | 85 | ||||||||||||
(Gains) losses on sales of equipment |
(79 | ) | (29 | ) | (1,684 | ) | 1,031 | |||||||||
Noncontrolling interest |
353 | 423 | 609 | 1,171 | ||||||||||||
Adjusted EBITDA (2) |
$ | 29,345 | $ | 32,260 | $ | 20,116 | $ | 78,486 | ||||||||
| Balance Sheet Data | 6/30/2010 | 3/31/2010 | 12/31/2009 | |||||||||
Cash and cash equivalents |
$ | 227,302 | $ | 190,839 | $ | 198,774 | ||||||
Working capital |
239,093 | 231,852 | 297,294 | |||||||||
Total assets |
767,828 | 720,317 | 728,378 | |||||||||
Total debt |
109,010 | 112,769 | 104,037 | |||||||||
Stockholders’ equity |
484,269 | 477,808 | 487,196 | |||||||||
Backlog Data (3) |
||||||||||||
By Reporting Segment |
||||||||||||
Upstream O&G |
$ | 328,596 | $ | 351,900 | $ | 245,586 | ||||||
Downstream O&G |
104,842 | 132,483 | 146,156 | |||||||||
| $ | 433,438 | $ | 484,383 | $ | 391,742 | |||||||
By Geographic Area |
||||||||||||
North America |
$ | 383,054 | $ | 436,058 | $ | 368,447 | ||||||
Middle East & North Africa |
50,384 | 48,325 | 23,295 | |||||||||
| $ | 433,438 | $ | 484,383 | $ | 391,742 | |||||||
| (1) | EBITDA is earnings before net interest, income taxes and depreciation and amortization and
intangible asset impairments. EBITDA as presented may not be comparable to other similarly titled
measures reported by other companies. The Company believes EBITDA is a useful measure of evaluating
its financial performance because of its focus on the Company’s results from operations before net
interest, income taxes, depreciation and amortization. EBITDA is not a measure of financial
performance under generally accepted accounting principles. However, EBITDA is a common alternative
measure of operating performance used by investors, financial analysts and rating agencies. A
reconciliation of EBITDA to net income is included in the exhibit to this release. |
|
| (2) | Adjusted EBITDA is defined as earnings before net interest, income taxes and depreciation and
amortization and intangible asset impairments, as adjusted for other items that management
considers to be non-recurring, unusual or not indicative of our core operating performance.
Management uses Adjusted EBITDA for comparing normalized operating results with corresponding
historical periods and with the operational performance of other companies in our industry and
presentations made to our analysts, investment banks and other members of the financing community
who use this information in order to make investing decisions about us. Most of the adjustments
reflected in Adjusted EBITDA are also included in performance metrics under our credit facilities
and other financing arrangements. However, Adjusted EBITDA is not a financial measurement
recognized under U.S. generally accepted accounting principles. Because not all companies use
identical calculations, our presentation of Adjusted EBITDA may not be comparable to similarly
titled measures of other companies. |
|
| (3) | Backlog is anticipated contract revenue from projects for which award is either in hand or
reasonably assured. |
###
WILLBROS
|
5 of 5 | |||
| CONTACT: | ||||
| Michael W. Collier | Connie Dever | |||
| Vice President Investor Relations | Director Strategic Planning | |||
| Sales & Marketing | Willbros | |||
| Willbros | 713-403-8035 | |||
| 713-403-8038 |