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Superior Energy Services, Inc. Announces First Quarter 2010 Results

NEW ORLEANS, April 28, 2010 /PRNewswire via COMTEX/ --Superior Energy Services, Inc. (NYSE: SPN) today announced net income of $21.5 million and diluted earnings per share of $0.27 on revenue of $364.5 million for the first quarter of 2010, as compared with net income of $56.8 million, or $0.72 diluted earnings per share on revenue of $437.1 million for the first quarter of 2009.

Terence Hall, Chairman and CEO of Superior, commented, "While our earnings are below year-ago levels, our financial and operational results are much improved from the fourth quarter of 2009, which is encouraging, especially since the first quarter is typically a seasonally weak period. The biggest factors driving the results were increased utilization of production-related services in the domestic land markets and higher demand for drilling products and services in the Gulf of Mexico, domestic land and international market areas."

The Company also reaffirms its previously announced full-year 2010 earnings guidance of $1.50 to $1.70 earnings per share.

Geographic Breakdown

For the first quarter of 2010, Gulf of Mexico revenue was approximately $162.7 million, a 56% increase from the fourth quarter of 2009 ("sequential"); domestic land revenue was approximately $92.6 million, a sequential increase of 27%; and international revenue was approximately $109.2 million, a sequential increase of 25%.

Subsea and Well Enhancement Segment

First quarter revenue for the Subsea and Well Enhancement Segment was $232.8 million, a 19% decrease from the first quarter of 2009 ("year-over-year") and a 60% increase sequentially. The first quarter of 2010 included $19.7 million in revenue from the recently acquired Hallin Marine and from oil and gas production and production-handling fees from the recently acquired Bullwinkle platform and related oil and gas assets. Revenue in the fourth quarter of 2009 was reduced by $68.7 million due to the cost adjustments related to the wreck removal project.

Segment revenue benefitted sequentially from increased demand for coiled tubing and cased hole wireline in the domestic land and Gulf of Mexico market areas, increased revenue from the wreck removal project and increased demand for hydraulic workover and snubbing services in international markets.

Income from operations was $23.7 million, or 10% of segment revenue as compared with $61.7 million, or 21% of segment revenue, in the first quarter of 2009, and a loss from operations of $176.6 million in the fourth quarter of 2009. The fourth quarter loss from operations includes $125.0 million in special charges and $68.7 million for total cost adjustments made to the wreck removal project. Excluding those charges, fourth quarter of 2009 income from operations would have been $17.1 million, or 8% of adjusted segment revenue.

Drilling Products and Services Segment

First quarter revenue for the Drilling Products and Services Segment was $114.3 million, 9% lower year-over-year and 17% higher sequentially. Income from operations was $23.9 million, or 21% of segment revenue, as compared with $35.3 million, or 28% of segment revenue in the first quarter of 2009, and $13.8 million, or 14% of segment revenue in the fourth quarter of 2009. The primary factors driving the higher sequential revenue were increased rentals of specialty tubulars and accommodations in the Gulf of Mexico, increased rentals of accommodations and stabilization equipment in the domestic land markets, and increased demand for drill pipe, specialty tubulars and ancillary equipment internationally in Brazil, the North Sea and Colombia.

Marine Segment

Marine Segment revenue was $17.5 million, a 24% decrease year-over-year and an 18% decrease sequentially. Loss from operations was $4.0 million, as compared with income from operations of $2.8 million, or 12% of segment revenue in the first quarter of 2009, and a loss from operations of $2.9 million in the fourth quarter of 2009.

The Company was without the services of both of its 265-foot class liftboats during the period. In addition, dayrates across most liftboat classes decreased sequentially. Average daily revenue in the first quarter was approximately $194,000, inclusive of subsistence revenue, as compared with approximately $257,000 per day in the first quarter of 2009 and approximately $230,000 in the fourth quarter of 2009. The decline was primarily due to the absence of the Company's 265-foot class liftboats which earn the highest dayrates in the fleet. Average fleet utilization was 47% as compared with 48% in the first quarter of 2009 and 45% in the fourth quarter of 2009.



           Liftboat Average Dayrates and Utilization by
                            Class Size
                Three Months Ended March 31, 2010
                            ($ actual)


                                  Average
      Class        Liftboats      Dayrate    Utilization
      -----        ---------      -------    -----------

    145'-155'        6            $5,740        22.8%
    160'-175'        8             7,357        48.9%
    200'             5            10,200        38.9%
    230'-245'        3            22,554        69.3%
    250'             2            32,031        96.1%
    265'(1)          2                --          --

    1 Out of service for repairs during the quarter.


Conference Call Information

The Company will host a conference call at 9 a.m. Central Time on Thursday, April 29, 2010. The call can be accessed from Superior's website at www.superiorenergy.com, or by telephone at 480-629-9690. For those who cannot listen to the live call, a telephonic replay will be available through Thursday, May 6, 2010 and may be accessed by calling 303-590-3030 and using the pass code 4284277. An archive of the webcast will be available after the call for a period of 60 days on http://www.superiorenergy.com.

Superior Energy Services, Inc. serves the drilling and production-related needs of oil and gas companies worldwide through its brand name drilling products and services and its integrated well enhancement services and tools, supported by an engineering staff who plan and design solutions for customers. Offshore projects are delivered by the Company's fleet of modern marine assets.

This press release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 which involve known and unknown risks, uncertainties and other factors. Among the factors that could cause actual results to differ materially are: volatility of the oil and gas industry, including the level of exploration, production and development activity; risks associated with the uncertainty of macroeconomic and business conditions worldwide, as well as the global credit markets; risks associated with the Company's rapid growth; changes in competitive factors and other material factors that are described from time to time in the Company's filings with the Securities and Exchange Commission. Actual events, circumstances, effects and results may be materially different from the results, performance or achievements expressed or implied by the forward-looking statements. Consequently, the forward-looking statements contained herein should not be regarded as representations by Superior or any other person that the projected outcomes can or will be achieved.



    FOR FURTHER INFORMATION CONTACT:
    Terence Hall, CEO; Robert Taylor, CFO;
    Greg Rosenstein, VP of Investor Relations, (504) 587-7374



              SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
                   Consolidated Statements of Operations
                Three Months Ended March 31, 2010 and 2009
             (in thousands, except earnings per share amounts)
                                (unaudited)

                                                    2010         2009
                                                    ----         ----

    Revenues                                    $364,511     $437,109
                                                --------     --------

    Cost of services (exclusive of items
     shown separately below)                     199,052      222,465
    Depreciation, depletion, amortization
     and accretion                                51,048       49,868
    General and administrative expenses           70,724       64,986
                                                  ------       ------
    Income from operations                        43,687       99,790

    Other income (expense):
      Interest expense, net                      (14,038)     (13,288)
      Earnings from equity-method
       investments, net                            3,985        2,256
                                                   -----        -----
    Income before income taxes                    33,634       88,758

    Income taxes                                  12,108       31,953
                                                  ------       ------

    Net income                                   $21,526      $56,805
                                                 =======      =======


    Basic earnings per share                       $0.27        $0.73
                                                   =====        =====

    Diluted earnings per share                     $0.27        $0.72
                                                   =====        =====

    Weighted average common shares used
      in computing earnings per share:
        Basic                                     78,534       78,032
                                                  ======       ======

        Diluted                                   79,353       78,428
                                                  ======       ======




                SUPERIOR ENERGY SERVICES, INC. AND SUBSIDIARIES
                          CONSOLIDATED BALANCE SHEETS
                      MARCH 31, 2010 AND DECEMBER 31, 2009
                                 (in thousands)


                                                    3/31/2010      12/31/2009
                                                    ---------      ----------
                                                  (Unaudited)      (Audited)

    ASSETS

    Current assets:
      Cash and cash equivalents                       $53,948        $206,505
      Accounts receivable, net                        388,497         337,151
      Income taxes receivable                               -          12,674
      Prepaid expenses                                 26,539          20,209
      Other current assets                            278,471         287,024
                                                      -------         -------

            Total current assets                      747,455         863,563
                                                      -------         -------

    Property, plant and equipment, net              1,263,760       1,058,976
    Goodwill                                          575,183         482,480
    Notes receivable                                   82,300               -
    Equity-method investments                          59,941          60,677
    Intangible and other long-term
     assets, net                                       72,363          50,969
                                                       ------          ------
            Total assets                           $2,801,002      $2,516,665
                                                   ==========      ==========

    LIABILITIES AND STOCKHOLDERS' EQUITY

    Current liabilities:
      Accounts payable                                $75,391         $63,466
      Accrued expenses                                149,640         133,602
      Income taxes payable                              2,315               -
      Current portion of decommissioning
       liabilities                                     18,633               -
      Deferred income taxes                            43,601          30,501
      Current maturities of long-term
       debt                                               810             810
                                                          ---             ---

            Total current liabilities                 290,390         228,379
                                                      -------         -------

    Deferred income taxes                             207,097         209,053
    Decommissioning liabilities                       109,232               -
    Long-term debt, net                               899,711         848,665
    Other long-term liabilities                       102,687          52,523

    Total stockholders' equity                      1,191,885       1,178,045
                                                    ---------       ---------

            Total liabilities and stockholders'
             equity                                $2,801,002      $2,516,665
                                                   ==========      ==========



                Superior Energy Services, Inc. and Subsidiaries
                               Segment Highlights
            Three months ended March 31, 2010, December 31, 2009 and
                                 March 31, 2009
                                  (Unaudited)
                                 (in thousands)


    Revenue                     March 31,     December 31,       March 31,
                                ---------     ------------       ---------
                                   2010           2009             2009
                                   ----           ----             ----

    Subsea and Well
     Enhancement                  $232,766       $145,822        $288,057

    Drilling Products and
     Services                      114,277         97,567         125,944

    Marine                          17,468         21,186          23,108
                                    ------         ------          ------

    Total Revenues                $364,511       $264,575        $437,109
                                  ========       ========        ========




    Gross Profit (1)              March 31,     December 31,       March 31,
                                  ---------     ------------       ---------
                                      2010           2009            2009
                                      ----           ----            ----

    Subsea and Well
     Enhancement                     $89,897         $2,946        $122,568

    Drilling Products and
     Services                         74,182         65,314          83,908

    Marine                             1,380          7,688           8,168
                                       -----          -----           -----

    Total Gross Profit              $165,459        $75,948        $214,644
                                    ========        =======        ========



    Income (Loss) from
     Operations                 March 31,     December 31,     March 31,
                                ---------     -----------      ---------
                                  2010           2009            2009
                                  ----           ----            ----

    Subsea and Well
     Enhancement (2)             $23,697      $(176,585)        $61,700

    Drilling Products and
     Services                     23,947         13,771          35,309

    Marine                        (3,957)        (2,945)          2,781
                                     ---            ---           -----

    Total Income (Loss) from
     Operations                  $43,687      $(165,759)        $99,790
                                 =======      =========         =======

    (1) Gross profit is calculated by subtracting cost of  Services
        (exclusive of depreciation, depletion, amortization and accretion)
        from revenue for each of the Company's segments.

    (2)  Loss from operations in the Subsea and Well Enhancement Segment
         for the three months ended December 31, 2009 includes a reduction
         in value of assets of $119.8 million, adjustments to the estimated
         total cost of the wreck removal project of $68.7 million and other
         special charges mentioned in the fourth quarter 2009 earnings press
         release.



SOURCE Superior Energy Services, Inc.