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Superior Energy Services, Inc. Announces First Quarter 2004 Results

HARVEY, La.--(BUSINESS WIRE)--April 29, 2004--Superior Energy Services, Inc. (NYSE: SPN) today announced results for the first quarter ended March 31, 2004. For the quarter, revenues were $116.5 million resulting in net income of $3.6 million or $0.05 diluted earnings per share, as compared to revenues of $123.2 million and net income of $7.5 million or $0.10 diluted earnings per share for the first quarter of 2003.

President and CEO Terry Hall Comments

President and CEO Terry Hall commented, "Gulf of Mexico activity levels through much of the first quarter remained weak before bottoming in late February. In March, however, we benefited significantly from employing our bundled services concept to abandon wells owned by SPN Resources and from an improving production-related services market. Our average liftboat utilization rebounded in March to its highest level since this past October, with utilization of more than 70% for the month. Also, in rental tools, we again set a quarterly record for revenue as deepwater projects and increased land drilling drove demand for drill pipe and stabilizers.

"Clearly, we are entering the second quarter on much stronger footing than we experienced for most of the first quarter. Well intervention activity and tool rentals are higher in April as compared to March. Although the liftboat market still remains highly competitive, we are experiencing longer-term projects for some of our liftboats, which should help utilization in certain classes."

Well Intervention Group Segment

First quarter revenues for the Well Intervention Group were $44.3 million, an 11% decrease from the fourth quarter of 2003. On a sequential basis, activity decreased for most production-related services, with the exception of mechanical wireline services, which benefited from several high pressure projects.

Rental Tools Segment

Revenues for the Rental Tools segment were a record $38.7 million, 11% higher than the fourth quarter of 2003, and 6% higher than the prior record of $36.4 million established in the second quarter of 2003. Rentals of stabilizers, drill pipe and accessories to customers in the U.S. land and Gulf of Mexico deepwater markets steadily increased throughout the quarter. The company rented its first drill pipe and handling tools in the West Africa market area. In addition, demand increased for rentals and services associated with refinery and plant projects, including bolting, torque services and on-site machining.

Marine Segment

Superior's marine revenues were $13.6 million, a 15% decrease as compared to the fourth quarter of 2003. Average fleet utilization was 64% as compared to 66% for the fourth quarter of 2003. Liftboat utilization showed improvement beginning in mid-February and increased for the remainder of the quarter. Average liftboat dayrates decreased approximately 5% as compared to the fourth quarter of 2003.

        Liftboat Average Dayrates and Utilization by Class Size
                   Three Months Ended March 31, 2004
                              ($ actual)

    Class           Liftboats       Average Dayrate     Utilization
    -----           ---------       ---------------     -----------
  105'                    6             $ 2,708           49.8%
  120-135'                8               3,384           67.0%
  145-155'               11               4,190           67.8%
  160'-175'               6               5,739           61.9%
  200'                    2               8,957           60.4%
  230'-245'               3              11,318           72.8%
  250'                    2              16,105           78.0%

Other Oilfield Services Segment

Revenues in this segment were $19.9 million, a 3% increase as compared to the fourth quarter of 2003. The sequential improvement was due primarily to increased activity for waste disposal, dockside cleaning and other environmental services.

The Company will host a conference call at 10 a.m. Central Time on Friday, April 30. The call can be accessed from Superior's website at, or by telephone at 800-763-5557. The replay telephone number is 800-642-1687 and the replay passcode is 6854774. The replay is available beginning two hours after the call and ending May 7, 2004.

Superior Energy Services, Inc. provides a broad range of specialized oilfield services and equipment primarily to major and independent oil and gas companies engaged in the exploration, production and development of oil and natural gas properties offshore in the Gulf of Mexico and throughout the Gulf Coast region. These services and equipment include the rental of liftboats, rental of specialized oilfield equipment, electric and mechanical wireline services, well plug and abandonment services, well control, hydraulic workover, coiled tubing services and engineering services. Additional services provided include contract operating and supplemental labor, offshore and dockside environmental cleaning services, the manufacture and sale of drilling instrumentation and the manufacture and sale of oil spill containment equipment.

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 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.

                 Consolidated Statements of Operations
              Three Months Ended March 31, 2004 and 2003
           (in thousands, except earnings per share amounts)

                                                      2004      2003
                                                   --------- ---------

Revenues                                           $116,459  $123,195
                                                   --------- ---------

Costs and expenses:
  Cost of services                                   66,705    70,157
  Depreciation, depletion, amortization and
   accretion                                         14,774    11,755
  General and administrative                         24,192    23,689
                                                   --------- ---------

     Total costs and expenses                       105,671   105,601
                                                   --------- ---------

Income from operations                               10,788    17,594

Other income (expense):
  Interest expense                                   (5,550)   (5,603)
  Interest income                                       441        88
  Equity in income of affiliates                         23       127
                                                   --------- ---------

Income before income taxes                            5,702    12,206

Income taxes                                          2,138     4,699
                                                   --------- ---------

Net income                                           $3,564    $7,507
                                                   ========= =========

Basic earnings per share                              $0.05     $0.10
                                                   ========= =========

Diluted earnings per share                            $0.05     $0.10
                                                   ========= =========

Weighted average common shares used
  in computing earnings per share:
    Basic                                            74,213    73,826
                                                   ========= =========
    Diluted                                          74,961    74,595
                                                   ========= =========

                 MARCH 31, 2004 AND DECEMBER 31, 2003
                            (in thousands)

                                                3/31/2004  12/31/2003
                                               (Unaudited)  (Audited)
                                               ----------- -----------

Current assets:
  Cash and cash equivalents                       $15,241     $19,794
  Accounts receivable - net                       118,473     112,775
  Notes receivable                                 16,143      19,212
  Prepaid insurance and other                      15,066      14,059
                                               ----------- -----------

        Total current assets                      164,923     165,840

Property, plant and equipment - net               435,395     427,360
Goodwill - net                                    208,926     204,727
Notes receivable                                   25,817      15,145
Investments in affiliates                          13,246      13,224
Other assets - net                                  6,890       6,567
                                               ----------- -----------

        Total assets                             $855,197    $832,863
                                               =========== ===========


Current liabilities:
  Accounts payable                                $21,895     $20,817
  Accrued expenses                                 49,131      48,949
  Income taxes payable                                189         138
  Current portion of decommissioning
   liabilities                                     18,081      20,097
  Current maturities of long-term debt             14,210      14,210
                                               ----------- -----------

        Total current liabilities                 103,506     104,211
                                               ----------- -----------

Deferred income taxes                              89,576      86,251
Decommissioning liabilities                        32,463      18,756
Long-term debt                                    252,166     255,516

Total stockholders' equity                        377,486     368,129
                                               ----------- -----------

        Total liabilities and stockholders'
         equity                                  $855,197    $832,863
                                               =========== ===========

            Superior Energy Services, Inc. and Subsidiaries
                          Segment Highlights
              Three months ended March 31, 2004 and 2003
                            (in thousands)

Revenue                                        March 2004   March 2003
                                               ----------   ----------
Well Intervention Group                         $ 44,258     $ 41,399
Marine                                            13,611       18,665
Rental Tools                                      38,732       34,600
Other Oilfield Services                           19,858       28,531
                                                --------     ---------
Total                                           $116,459     $123,195

Gross Profit (1)
Well Intervention Group                         $ 18,924     $ 16,645
Marine                                             1,982        5,998
Rental Tools                                      26,119       23,486
Other Oilfield Services                            2,729        6,909
                                                --------     ---------
Total                                           $ 49,754     $ 53,038

(1) Gross profit is calculated by subtracting cost of services from

revenue for each of the Company's four segments.

    CONTACT: Superior Energy Services, Inc., Harvey
             Terence Hall/Robert Taylor/Greg Rosenstein, 504-362-4321

    SOURCE: Superior Energy Services, Inc.