ATWOOD OCEANICS INC - FORM 8-K - EX-99.1 - FINANCIAL STATEMENTS

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8-K - 2ND QUARTER FY14 EARNINGS - ATWOOD OCEANICS INC	atw-201403318xk.htm

EXHIBIT 99.1

Houston, Texas

April 30, 2014

FOR IMMEDIATE RELEASE - EARNINGS

ATWOOD OCEANICS, INC., announced today that the Company earned net income of $73.3 million or $1.13 per diluted share, on revenues of $273.1 million for the quarter ended March 31, 2014 compared to net income of $83.4 million or $1.28 per diluted share on revenues of $284.7 million for the quarter ended December 31, 2013 and compared to net income of $85.5 million or $1.28 per diluted share, on revenues of $253.2 million for the quarter ended March 31, 2013. For the six months ended March 31, 2014, the Company earned net income of $156.7 million or $2.41 per diluted share, on revenues of $557.8 million compared to net income of $158.4 million or $2.39 per diluted share, on revenues of $498.3 million for the six months ended March 31, 2013.

Rob Saltiel, President and CEO, commented, “Our second quarter financial results were affected negatively by start-up issues with the Atwood Advantage that resulted in 22 zero-rate days in March. The remainder of our rig fleet performed well in the quarter, partially offsetting this lost revenue.”



	For the Three Months Ended
				(Unaudited)
(In thousands, except per share amounts)	March 31, 2014			December 31, 2013			March 31, 2013
Revenues	$	273,097		$	284,706		$	253,161
Income before Income Taxes	97,283			94,260			97,432
Provision for Income Taxes	(23,983		)	(10,863		)	(11,913		)
Net Income	$	73,300		$	83,397		$	85,519

Earnings per Common Share -
Basic	$	1.14		$	1.30		$	1.30
Diluted	$	1.13		$	1.28		$	1.28



	For the Six Months Ended
				(Unaudited)
(In thousands, except per share amounts)	March 31, 2014				March 31, 2013
Revenues	$	557,803			$	498,254
Income before Income Taxes	191,543				181,519
Provision for Income Taxes	(34,846		)		(23,169		)
Net Income	$	156,697			$	158,350

Earnings per Common Share -
Basic	$	2.44			$	2.41
Diluted	$	2.41			$	2.39

ATWOOD OCEANICS, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS



	Three Months Ended March 31,						Six Months Ended March 31,
(In thousands, except per share amounts)	2014			2013			2014			2013
REVENUES:
Contract drilling	$	260,062		$	242,321		$	533,619		$	477,115
Revenues related to reimbursable expenses	13,035			10,840			24,184			21,139
Total revenues	273,097			253,161			557,803			498,254

COSTS AND EXPENSES:
Contract drilling	136,966			98,561			260,128			204,499
Reimbursable expenses	9,188			8,912			17,602			14,890
Depreciation	37,231			28,482			69,775			56,060
General and administrative	15,022			13,268			34,844			30,489
Gain on sale of equipment	(34,443		)	—			(34,079		)	—
Other, net	399			(20		)	(1,602		)	(13		)
	164,363			149,203			346,668			305,925

OPERATING INCOME	$	108,734		$	103,958		$	211,135		$	192,329

OTHER INCOME (EXPENSE)
Interest expense, net of capitalized interest	(11,502		)	(6,547		)	(19,713		)	(10,955		)
Interest Income	51			21			121			145
	(11,451		)	(6,526		)	(19,592		)	(10,810		)

INCOME BEFORE INCOME TAXES	97,283			97,432			191,543			181,519
PROVISION FOR INCOME TAXES	23,983			11,913			34,846			23,169
NET INCOME	$	73,300		$	85,519		$	156,697		$	158,350

EARNINGS PER COMMON SHARE:
Basic	$	1.14		$	1.30		$	2.44		$	2.41
Diluted	$	1.13		$	1.28		$	2.41		$	2.39
WEIGHTED AVERAGE COMMON SHARES OUTSTANDING:
Basic	64,238			65,733			64,175			65,631
Diluted	65,031			66,589			65,028			66,341

ATWOOD OCEANICS, INC. AND SUBSIDIARIES

UNAUDITED ANALYSIS OF REVENUES AND DRILLING COSTS



	REVENUES
	Three Months Ended						Six Months Ended
(In millions)	March 31, 2014		December 31, 2013		March 31, 2013		March 31, 2014		March 31, 2013
Ultra-Deepwater	$	119.9	$	87.2	$	76.2	$	207.1	$	159.0
Deepwater	64.0		107.6		104.0		171.6		204.0
Jackups	76.2		78.8		62.1		154.9		114.1
Reimbursable	13.0		11.1		10.9		24.2		21.2
	273.1		284.7		253.2		557.8		498.3



	DRILLING COSTS
	Three Months Ended						Six Months Ended
(In millions)	March 31, 2014		December 31, 2013		March 31, 2013		March 31, 2014		March 31, 2013
Ultra-Deepwater	$	45.9	$	35.2	$	30.0	$	81.1	$	59.7
Deepwater	56.6		48.8		38.7		105.4		84.4
Jackups	33.3		36.6		29.8		69.9		58.1
Reimbursable	9.2		8.4		8.9		17.6		14.9
Other	1.2		2.6		0.1		3.7		2.3
	$	146.2	$	131.6	$	107.5	$	277.7	$	219.4

ATWOOD OCEANICS, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS



(In thousands)	March 31, 2014			September 30, 2013
ASSETS
Cash and cash equivalents	$	59,635		$	88,770
Accounts receivable, net of allowance for doubtful accounts of $679 and $0 at March 31, 2014 and September 30, 2013, respectively	238,569			199,689
Income tax receivable	6,215			4,672
Inventories of materials and supplies	124,416			121,833
Prepaid expenses and deferred costs	28,841			38,796
Total current assets	457,676			453,760

Property and equipment, net	3,575,172			3,164,724

Other receivables	11,831			11,831
Deferred costs and other assets	39,937			26,951
Deferred income taxes	518			—
Total assets	$	4,085,134		$	3,657,266

LIABILITIES AND SHAREHOLDERS' EQUITY
Accounts payable	$	88,585		$	95,827
Accrued liabilities	16,319			17,653
Notes payable	—			8,071
Interest payable	8,278			7,945
Income tax payable	19,645			16,554
Deferred credits	12,653			10,822
Total current liabilities	145,480			156,872

Long-term debt	1,512,685			1,263,232
Deferred income taxes	354			485
Deferred credits	12,305			1,176
Other	41,269			28,130
Total long-term liabilities	1,566,613			1,293,023

Commitments and contingencies

Preferred stock, no par value, 1,000 shares authorized, none outstanding	—			—
Common stock, $1.00 par value, 180,000 shares authorized with 64,253 and 64,057 issued and outstanding at March 31, 2014 and September 30, 2013, respectively	64,253			64,057
Paid-in capital	192,570			183,390
Retained earnings	2,118,102			1,961,405
Accumulated other comprehensive loss	(1,884		)	(1,481		)
Total shareholders' equity	2,373,041			2,207,371
Total liabilities and shareholders' equity	$	4,085,134		$	3,657,266

ATWOOD OCEANICS, INC. AND SUBSIDIARIES

UNAUDITED CONDENSED CONSOLIDATED

STATEMENTS OF CASH FLOWS



	Six Months Ended March 31,
(In thousands)	2014			2013
Cash flows from operating activities:
Net income	$	156,697		$	158,350
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation	69,775			56,060
Amortization of debt issuance costs and bond premium	2,328			2,073
Amortization of deferred items	2,185			1,448
Provision for doubtful accounts	679			1,871
Provision for inventory obsolescence	860			360
Deferred income tax benefit	(649		)	(466		)
Share-based compensation expense	7,725			6,813
Gain on sale of assets	(34,079		)	—
Other, net	2,118			(13		)
Change in assets and liabilities:
Accounts receivable	(39,559		)	24,563
Income tax receivable	(1,543		)	(199		)
Inventory	(8,097		)	(14,106		)
Prepaid expenses	9,524			10,109
Deferred costs and other assets	(26,568		)	(8,084		)
Accounts payable	(8,617		)	(43,864		)
Accrued liabilities	(1,276		)	(5,282		)
Income tax payable	3,091			6,582
Deferred credits and other liabilities	33,910			8,247
Net cash provided by operating activities	168,504			204,462

Cash flows from investing activities:
Capital expenditures	(497,634		)	(372,957		)
Proceeds from sale of assets	56,517			61
Net cash used in investing activities	(441,117		)	(372,896		)

Cash flows from financing activities:
Proceeds from bank credit facilities	340,000			310,000
Principal payments on bank credit facilities	(90,000		)	(100,000		)
Principal payments on notes payable	(8,071		)	(5,148		)
Proceeds from exercise of stock options	1,651			3,418
Debt issuance costs paid	(102		)	—
Net cash provided by financing activities	243,478			208,270
Net increase (decrease) in cash and cash equivalents	$	(29,135	)	$	39,836
Cash and cash equivalents, at beginning of period	$	88,770		$	77,871
Cash and cash equivalents, at end of period	$	59,635		$	117,707
Non-cash activities:
Changes in accounts payable and accrued liabilities related to capital expenditures	$	1,375		$	34,046

Atwood Oceanics is a leading offshore drilling company engaged in the drilling and completion of exploration and development wells for the global oil and gas industry. The company currently owns 12 mobile offshore drilling units and is constructing three ultra-deepwater drillships. The company was founded in 1968 and is headquartered in Houston, Texas. Atwood Oceanics, Inc. common stock is traded on the New York Stock Exchange under the symbol "ATW."

As part of our ongoing commitment to our shareholders, Atwood Oceanics uses a variety of Social Networks sites to disseminate company information. For a full list of the official Social Media pages for Atwood Oceanics, please visit the Social Media Disclaimer page of our IR site at: http://ir.atwd.com/GenPage.aspxIID=4010374&GKP=210376.

Contact: Mark L. Mey

(281) 749-7902

ATWOOD OCEANICS INC - FORM 8-K - EX-99.1 - FINANCIAL STATEMENTS - April 30, 2014

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